3-D CRM: More Than A 360° View

With the evolution of CRM, there has evolved three specific dimensions: operational, collaborative, and analytical. Vendors in the operational area offer solutions that automate different tasks, such as sales force automation and customer service. Those in the collaborative sector enable companies to get closer to the customer via such tools as telephony and Web chats. Lastly, those vendors participating in the analytical arena offer applications with trend analysis, personalization, prediction, and data mining functionality.

A New Dimension To CRM - 3-D
There was a time when finding a complete CRM solution meant finding a way to look at your customer from all touch points within your business - having a 360-degree view. (Usually this could be done by choosing a solution from one of the above three dimensions.) Now, companies are taking a step back and evaluating CRM. Vendors are partnering and crossing lines. Now, complete CRM has come to mean a fully integrated solution, touching all three specific dimensions - otherwise known as 3-D CRM.

Jacob Lamm, Senior VP at Computer Associates, responsible primarily for CRM and business intelligence explained, "If you look at first-generation CRM, it really had its roots in operational areas." At that time, there was an increase in e-business initiatives and companies realized how important it was to focus on e-business customers (now that the competition was only a mouse click away). "In those days," adds Lamm. "Companies were throwing their money at anything that said CRM on it." Recently however, there was a change in the way companies purchase CRM applications. As Joe Sanda, president & CEO of Astute Solutions explains, "Customers are becoming a little more savvy and expecting better explanations in terms of ROI." Lamm agrees. "Companies are asking themselves, 'what really is the return on this investment?' The answer they most often find is 'a closer look at a happier customer.'" Thus, companies have begun to move toward more collaborative CRM tools and vendors have begun to partner up and/or embed these collaborative tools into operational applications.

More recently, companies have grown even savvier. "Companies are tired of making a multimillion dollar investment in a collaborative/operational system and not seeing the kind of ROI they expected," adds Sanda. Because of this, companies have begun to ask themselves not just, 'where is ROI?' but 'how do you measure ROI?' They've also asked themselves, 'who exactly are my customers?' and 'what is the measurement of customer loyalty?' Unfortunately, operational CRM tools don't answer these questions. "Operational and collaborative tools automate processes, sometimes reduce costs, and increase efficiencies," illustrates Lamm. "But to see ROI in a CRM solution, you need to step into the analytical CRM space." Analytical CRM can be anything from real-time analytics, historical trend analysis, and predictive CRM to proactive customer management and the personalization of customer interactions. These are things that can help companies not only measure customer loyalty, but also measure the solution.

As with most markets, there are a lot of commodity products available today. The key to picking a quality solution is a.) Check references and b.) Look at integration capabilities. "I'm amazed at how many times customers buy into a vendor's pitch without checking references to see what kind of work they've done," advises Sanda. "I'm as equally amazed at how many times companies underestimate the value of having an integrated solution."

Integrate Your CRM Solutions
We've discussed the importance to implementing a CRM strategy that will address all three areas of CRM, but what good is the strategy if all three components are not fully integrated? "Integration adds value because it adds consistency for customers," explains Sanda. "It also adds consistency in terms of reporting and management. For example, some companies might have an e-mail management solution that has its own reporting. They also might have a telephony solution that has its own reporting. But these companies don't have a consistent view of the customer or customer service until they integrate both solutions." Lamm agrees. "One reason why CRM systems fail is because of the lack of integration - either the system can't integrate data, integrate with other systems, or integrate with partner applications. Sure, you can view the customer from all touch points, but it's not three-dimensional - and it's not complete CRM."