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Gartner analyst details CRM process problems

At Garner's CRM summit, analyst Scott Nelson cited a laundry list of reasons why organizations are missing the mark when it comes to putting the CRM process in place.

CHICAGO -- You can see why Gartner analyst Scott Nelson was once labeled "the man who killed CRM" by a business publication.

Delivering his keynote address at Stamford, Conn.-based Gartner's CRM Summit Fall, Nelson cited a laundry list of reasons why businesses can't seem to get the CRM process right.

To illustrate CRM's shortcomings, he even mentioned his own customer frustrations while trying to buy out his car lease.

"You read about auto companies getting stuck with acres of off-lease cars. Even though I wanted to do so, I didn't end up buying my car because of poor CRM process," Nelson said. "The current state of CRM is that many companies have taken their old ways, layered in technology, and subsequently become able to tick off their customers even faster."

Nelson got ticked off when his buyout offer arrived in the mail without the appropriate paperwork. He had to chase down the leasing company's CIO to get the right form, which then arrived without an address where it should be sent back.

But don't consider Nelson the ultimate CRM naysayer.

Despite the challenges in implementing applications, he does think CRM will determine whether organizations are successful in the 21st century. Still, Nelson estimates that half of all U.S. businesses still have no real CRM strategy in place whatsoever.

Nelson said leading causes of continued CRM failure include politics and the internal organizational debate over who owns customer data. He went on to advocate a series of fundamental CRM building blocks including vision, organizational collaboration and a customer-centric shift in business process.

Relating to CRM applications vendors, Nelson said products must emerge that offer a more unified view of customer and supplier data, greater insight into customers, more effective interactions, and increased customer access.

"The classic error made by organizations is to attempt to address too many objectives at once," he said. "These often contradictive efforts must be more tightly tied together."

Nelson went on to say that organizations involved in CRM need to create diverse customer metrics, like how customer data relates to spending or their interaction with the company in terms of service, to serve as "key levers" for change in business process. The analyst said successful adoption of these concepts would spell the eventual end of CRM and the emergence of a two-dimensional philosophy in which customer value and financial value exist at the sweet spot of all internal business investments.

Show-goers, for the most part, seemed to agree with the analyst's conclusions and recommendations. Howard Karp, a help desk manager at United Parcel Service Inc., Atlanta, one of the companies Nelson poked fun at during his speech, related to the idea that CRM strategy and applications often exist toward different ends.

"It's a real struggle to balance long-term goals with ongoing initiatives, and the idea of finding an internal champion for CRM remains key," Karp said. "As a manager it is still hard for me to understand just how far we've actually come in getting to know our customers."

At least one senior executive on-hand from an applications development company maintained that his organization is attempting to take its products in the direction Nelson advocated. Dror Pockard, president of San Jose, Calif.-based Clarify, blamed vendors for creating hype that has damaged CRM as a whole. He promised that software improvements are coming.

"We understand now that process management must serve as the foundation from an applications perspective," Pockard said. "Functionality such as stronger front- and back-end integration, more clear order management process, and improved analytics are what customers are asking us for."

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