Build Collaborative Relationships that Deliver Value
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Build Collaborative Relationships that Deliver Value
February 13, 2003
Atlanta, Georgia, USA
Bob ThompsonCEO, CustomerThink Corporation
Founder, CRMGuru.com
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Competing for Scarce Customers
Supply
Demand
Time
ScarceProducts
ScarceCustomers
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“Be distinct or be extinct”
Tom Peters
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“ It’s incredibly arrogant for a company to believe it can deliver the same sort of product that its rivals do and actually do better for very long. That’s especially true today, when the flow of information and capital is incredibly fast.”
Michael Porter Fast Company
ProductLeadership
OperationalExcellence
CustomerIntimacy
CRM
Great Relationships = Differentiation
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Loyalty Leaders Grow Faster, Spend Less
Average LoyaltyLeader
100%85%
0
50
100
150
200
250%
Costs
Average LoyaltyLeader
100%
220%
0
50
100
150
200
250%
Growth
Source: Reichheld
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CRM is Not New…Or is It?
"The true business of every company is to make and keep
customers.” -- Peter Drucker
“CRM = being so obsessed with your customer’s satisfaction that
you change the way you do business.” -- Dr. Jon Anton
CRM Confusion!
• 360-degree view of the customer
• Improving quality of customer interaction
• New software tools and technologies
• Getting right data to right employee
• Shift from product to customer orientation
• Buzzword and management fad!
Source: META Group/IMT Strategies
“CRM means creating mutual wins with customers and all company
stakeholders.” -- Bob Thompson
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“CRM is 90% half mental”Yogi Berra, CRM Consultant
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Customers Define a Great Relationship
“Service and value just for me”
“Personal”
“Responsive and proactive”
“Win/Win”
“Asks questions”
“A good deal for the money”
“Quality, consistent performance over time”
“Expertise”
“A history of working together”
“Easy to do business with”
Source: CRMGuru.com
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The New 4 Ps
Relationship Drivers• Passion• People• Process• Performance
“ Marketing Mix”
Product
Place
Promotion
Price
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CRMGuru Study: CRM Works!
Payback Period
Benefits(Percent of Projects)
• Increase customer satisfaction (51%)
• Increase customer acquisition rate (50%)
• Increase share-of-customer (48%)
• Decrease customer defection rate (37%)
• Decrease front office staffing costs (33%)
Investment • 33% -- less than $50,000• 24% -- $50,000 to $250,000• 28% -- $250,000 to $2.5 Million• 15% -- over $2.5 Million
Source: CRMGuru.com
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Key Drivers of Success• Customer-centric strategy: using customer
satisfaction and attrition data, getting customers involved in planning
• Front line training and support: explaining value of CRM, providing training for new skills required
• Organizational change: workflow design, changing roles and responsibilities
• Metrics: goals measured statistically (80% don’t)
Source: CRMGuru.com study “The Blueprint for CRM Success”
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Three-Year “Overnight” Success
• Objectives: Serve channel partners better, sell more, spend less
• Solution: Allegis eBusiness (PRM)– Saved $375,000 in communication costs– Increased revenue $1 million with better lead management– Improved partner and employee satisfaction
• Lessons Learned:– Understand your users, deliver clear value to them– Plan carefully, build a team, phase the implementation– Establish baseline metrics and measurement process– Communicate, communicate, communicate!
Source: Lexmark
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Are You Listening?
“ If you’re constantly getting feedback from your customers …and you’re willing to listen, you can make the most of the opportunities implicit in those needs.”
Michael Dell, in Direct From Dell
“ Businesses survive or decline based on their employees’ ability to listen. Hire the smartest, best people you can get, orient them to customer satisfaction at the expense of all else, then get out of their way and let them work.”
Doug Allred, SVP Customer Advocacy for Cisco Systems
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Selling Through Complex Channels
Customers
Selling ChannelsDealersMarketplaces OEMsRetailers EtailersReseller
EnterpriseEnable Commerce
With sellingpartners
Visibilityof customer
activity
Influenceover customer
experience
Collaborationwith partner
business processes
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CRM Technology Evolution
CRM Maturity
Po
ten
tial
Co
mp
etit
ive
Ad
van
tag
e
Low High
Automate
Streamline internal sales and service processes.
More of the same, done faster and cheaper.
SFA, Call Center
Single Channel
Collaborate
Engage customers and partners for win/win/win
Enable many-to-many relationship networks
C-Biz Solutions
CollaborativeNetwork
Innovate
Design different, more effective processes
Use new channels and customer touch points
eCRM, PRM
Multi- Channel
High
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“ The Internet as a sales channel represents only a fraction of its potential to
business. The real potential lies in its ability to transform
relationships with the traditional supplier-vendor-
customer chain.”
Michael Dell
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Seller Buyer
CRM
SCM
CollaborativeBusiness
Win/WinPhilosophy
EnablingSystems= +
Collaboration
Collaborative Business: Mutual Benefits
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Now: Point-To-Point Relationships
Supplier Partner CustomerManufacturer
CRM PRM CRM
Relationship Management: “Sell-Side” Focus on Lifetime Value, Customer Experience, Revenue/Profit Growth
SCMSCM SCM
Supplier Management: “Buy-Side” Focus on Cost, Cycle Time, Responsiveness
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Web Services: Enabling xRM Systems
• A New Breed of Web Application– Self-contained, self-describing, modular
applications– Can be published, located, and invoked across
the Web– Performs functions -- simple to complicated
processes– Other applications can discover and invoke
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Web Services: Enabling xRM Systems• The Potential
– Low-cost integration within, and between, enterprises
– Enabling process integration between trading partners
– Improving performance of collaborative networks
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Future: Optimized Value Network
Suppliers Customer
Manufacturer
Partners
Collaborative Relationships: Focus on Mutual Value, Profit, Efficiency, Integrated Processes
GlobalCompetition
Power Shift to Customers
InternetAdoption
Internet StandardsWeb Services
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Types of Collaborative Systems
• People to Systems – CRM/PRM
Portals
• People to People – Groupware
• System to System – E2E CRM
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Evolution to Collaborative NetworksAutomation
Focus
Multi-SystemCRM
Collaborative Commerce
N-Tier ChannelManagement
Work TeamCollaboration
IntegratedPortals
eCRM
CustomerRelationshipManagement
Sell-SideeBusiness
PRM
Enterprise Channels
Sell-SideCollaborative
eBusiness
Relationship Networks
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Complex Support Process
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Collaboration at Your Service
• World’s largest provider of mobile Internet software; Openwave
customers serve more than half of all mobile subscribers worldwide
• Challenge: Developer base growing rapidly (100,000+) and
support volumes increasing 50% per month
• Solution: ePeople Teamwork
– 70% reduction in average time to resolution
– Multiple support providers can work together
– Handle developer growth without increase in staff
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Business Processes Integration
Vendor PartnerProcessConnector
Status
Leads
Vendor PartnerProcessConnector
Status
Opportunities
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Collaborative Commerce Workflow
Vendor Partner
4. Status
2. Order
Customer
1. Research 3. Confirm
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Collaborative CommerceThe Challenge
Create Three Winners• Customers: ability to buy
products on-line• Partners: Leverage
existing relationships• Enterprise: Enhance the
Maytag brand
Source: Comergent
Consumers
Retailers
MaytagCommerce
System
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Group CollaborationNearly 80% of corporate
knowledge is unstructured Information. Gartner Group
Shared Workspace
Customers
PartnersEmployees
Suppliers
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“ There is only one boss: the customer.
And he can fire everybody in the
company, from the chairman on down, by simply spending his money somewhere
else.”Sam Walton
Wal-Mart Founder
Basic Beliefs1. Respect for the Individual
2. Service to Our Customers
3. Strive for Excellence