To print: Click here or Select File and then Print from your browser's menu

This story was printed from silicon.com, located at http://www.silicon.com/

Story URL: http://comment.silicon.com/0,39024711,11032568,00.htm

Ebusiness Despatches: Confusing CRM with great customer service
Gold, silver and bronze? More like dirt, filth and mud...

By René Carayol

Published: Wednesday 10 April 2002

Buying technology won't remedy any amount of shoddy customer service. It's a lesson many organisations must learn, says columnist Rene Carayol...

For a few years now software vendors, integrators and the other usual suspects have been saying customer relationship management (CRM) technology is the key to good customer service. How wrong they are.

This month, I'd like to outline some clear objectives for successful CRM implementations. But first, let me tell you about a recent experience to justify my advice.

I had to give a keynote speech at a sales conference in Nice and was due to fly there with the organisation that I'd be speaking to. My flight was good. It was British Airways business class, costing £540.

There were no hitches, I drank champagne in the lounge, took all the luggage I wanted and even noticed I was served by better-looking staff. (Check this one out next time if you haven't already - it may not be right but it's true.)

The other people attending the event had a different experience. For a start, they flew economy class, at a cost of £250. They had to fight tooth and nail to prevent expensive and essential IT equipment being thrown in the hold, and it was noticeable they were faced with a BA staff shortage. Not good.

Now for the staff's partners, who'd be joining them on the French Riviera. They flew Go!, the budget airline formerly part of BA. Yes - we're talking three tiers of ticket here. They had a good experience. Cheap (£54) but cheerful, on time and certainly in line with expectations.

Clearly, the customers in the middle - those flying BA economy - were the ones who suffered in this tale, the ones who were ghettoised. The starting point to customer service in any organisation must be that everyone gets 'good enough' and only then CRM kicks in, enabling prioritisation.

For a budget airline -a Go! or an easyJet or a Ryanair - I'd question the usefulness of CRM. Providing the basics properly at a value price is key. However, for a flag carrier with various classes CRM is essential.

My £540 must be justified, and it was, but for those paying £250 - still almost five times as much as the budget equivalent - the cost wasn't justified.

The central point is that whatever technology a user may buy, CRM only works in an existing customer-centric organisation.

Here are six ways to get the most out of CRM:

1 Set clear CRM goals and objectives - is it being used to increase profitability or loyalty? Decide early.
2 Build on strong foundations. The essential building block is decent customer service levels for all - then treat others 'obscenely well'.
3 Honesty and openness. Tell customers where they rank from the outset (note, again, the success of the budget carriers). Then feel free to make them aspirational.
4 Consistency is all - same service levels, every time.
5 Personalise service wherever possible. This would include a simple "How was your last trip to Nice?" but not include a quote three weeks before my car insurance comes up from a company I phoned but didn't use last year. That's spam to me.
6 If you embrace CRM, grow fast and promote slow. In other words, don't make a song and dance about segmented service levels until they are bedded down and points 1 to 5 can be checked off.

CRM is the way forward for most customer-facing businesses but only when done properly. Ultimately it is another business process. It isn't a panacea to bad practice.

A company such as BA offers gold, silver and bronze levels of customer service to its business customers. Let's not confuse that with dirt, filth and mud. The only consolation for most companies in this mess is that their competitors are doing even worse. Don't get me started on BMI.