Creating Institutional Memory: The Key To Customer Relationship Management
When multiple employees within your company interact with the same customer, how well does your system perform?
As a business transforms through the business-life cycle, leaders are faced with challenges of continued revenue growth. This often leads to periodic self-examination and reflection in the hope of uncovering new opportunity areas. Today businesses embrace CRM (customer relationship management) and 1:1 marketing as a potential growth strategy used to achieve and maintain top-line revenue objectives. The rationale for employing these strategies is simple. The value exchange is between the customer and the company. Hence, the key is in customer management, not product management.
The Customer-Focused Organization
A customer-focused organization is a radical departure from product-focused organizational models. It often causes companies to completely re-organize people, process and technology - a difficult task. The objective in such a re-deployment is usually to concatenate the front office and the back office systems to support the collection and application of customer information at critical steps in the customer-life cycle.
The business ontology of today suggests a systems approach to customer management, which fails to recognize the fact that customer information and wielding customer information is the strategic advantage, not the systems used to store, house, or propagate it. Hence, the sufficient condition in moving to a customer-focused organization is developing institutional memory.
Institutional Memory
Different people in the same company will regularly interact with the same customer. At these interaction points both the collection and the use of information are crucial in providing the right mix of value and service in real time, or at some future point in time. Leveraging new or previous information on the customer is critical to that end. This requires creating, developing, and maintaining an institutional memory of the customer.
Institutional memory is best defined as a complete and contextual representation of all dealings with a customer across the organization. In concept, a database is a good example. The reality is that most companies do not have a complete and contextual representation of the customer in a shared database. In fact, most companies evolve multiple representations of the customer resulting in a lack of complete information or history of the customer.
The lack of complete knowledge and history contributes to Institutional Alzheimer's, resulting in symptoms such as inability to remember customers or unnecessary marketing to existing ones. The result is often failure to leverage key interaction points with customers and wasted marketing efforts, respectively.
The Need For Customer Information Management
Contending with the above is no easy task. A strategy needs to be in place. Adopting a CIM (customer information management) approach can enable companies to achieve the type of Institutional Memory necessary to support a customer-focused business model. Information needs to be treated as an asset and a process needs to be in place to effectively manage it.
For CRM to work, a clear information need must be defined and appropriate measures taken to gratify it. Then steps must be taken to align with internal customers and their information needs, which will ultimately determine how and what data should be collected, integrated, and managed.
Once this is complete, the focus should be on better processes to improve the information-value chain and the information-life cycle: from order entry to database to updates. This requires companies to develop a CIM strategy to manage information from the moment it flows into the organization. The result is the right information, at the right time, in the right form, and on the right customer - the key to CRM and 1:1 marketing.