How To Measure CRM?

Afsheen Chitnis
Member

Posted 05-Jul-2006 04:30 PM
Hi

One of the most important issues in management is measurement. How can we measure the strategic CRM such as culture change in an organization?

Regards
Afsheen Chitnis

David Rance
Guru
Member

Posted 06-Jul-2006 09:45 AM
This is a good question. There are a lot of capabilities around CRM that cannot be measured in traditional ways. Culture is certainly one of these and is critical to the success of any CRM program. I think there are two answers to your question: Firstly you need to understand all the components of complex topics such as culture and how each one impacts on the CRM program. For example data analytics and propensity analysis can provide customer-facing people with suggested best pricing packages and product offerings that they can discuss with the customer. Agents can also be supported by dynamic treatments and processes that create unique experiences for each customer. If this is the case it is essential that the customer-facing people have the knowledge, skills, training, information, insight, decision-making authority and flexibility required to deal with all these options—not to mention the time required to spend on a call with the customer to find a resolution, the team leader style that coaches and supports them rather than controls them and of course a reward & recognition system that promotes the right behaviors. Secondly, as managers do seem obsessed with measurement, it is important that whatever measures are used they are all applied consistently across the organization and that they support the goal of the CRM program and not hinder its execution—as is often the case. Check out an article on www.CRMGuru.com called ‘The madness of metrics’. It may be of help.

David is a specialist in customer centricity—helping companies put customers at the heart of their business.

Vladimir Dimitroff
Member

Posted 06-Jul-2006 03:15 PM
I agree with David that "...you need to understand all the components of complex topics such as culture...".

Further to the familiar saying "If you don't measure it, you can't manage it" I often like to say "You cannot measure it if you don't define it". Any measurement approach/technique starts with a definition of the attribute to be measured.

What is culture? Which critical components (culture can be quite a complex 'thing') provide differentiation from other organisations (and from your own state in different time periods)?

If you adopt the view (shared by most gurus and members here) that CRM involves a progressive evolution of organisational behaviour ('journey'), then measurement can be made easier by examining benchmark capabilities of organisations at different stages in their journey. With a good definition of culture you may look at how those critical components are manifested at the more customer-centric companies, and what they look like in a more basic, product/efficiency focused business.

And you don't have to invent the wheel—such benchmarks have been researched, frameworks established and even tools created to measure various aspects of customer centricity—including Culture.

Just ask the guru Smile

Vladimir Dimitroff
PRISM Consulting (UK)
vdimitroff@prism-gb.com

Graham Hill
Guru
Member

Posted 16-Jul-2006 11:48 PM
Afsheen

This is a complex and difficult question.

I agree with David that as many of the drivers of CRM success as possible and their inter-relationships should be understood if CRM is to be successful.

But I am increasingly wary of overly simplistic approaches to measurement and management. For example, I have seen a number of recent implementations of Kaplan & Norton's Balanced Scorecard that did not work as too much time was spent on developing "sacred metrics" to be measured, managed and worshipped, rather than on understanding how the business really worked and using this systemic understanding to develop the handful of measures actually required by the business. Paradoxically, it is to develop this systematic, long-term view of how business works that Kaplan & Norton developed their Strategy Maps approach in the first place. It is just management's ungainly rush to be seen to be measuring something, anything almost, NOW, that derails the whole thing.

The things that can be measured are not always the most useful measures. And the most useful measures are not always the easiest to measure.

Culture falls into the latter of these categories. Whatever "culture" is?

Graham Hill
Independent CRM Consultant

David Jackson
Member

Posted 19-Jul-2006 01:19 AM
Afsheen

Culture is an outcome of the myriad things that organisations do and as such cannot be 'measured'. David is right to point out that you have to break it down into consitutent parts and look at those. There are numerous tools for measuring culture, we have helped customers implement climate surveys that track these. Look at the work of Geert Hofstede and Ed Schein for a coupel of examples.

Regards

Dave J
clicktools.com

Graham Hill
Guru
Member

Posted 19-Jul-2006 04:03 AM
David

You are right to suggest that culture is an emergent phenomenon that results out of the myriad way things are done in a company.

But I do not think you are right when you suggest that you cannot measure culture and that you have to settle with looking at the constituent parts instead. Sure it is tough, but if culture IS an emergent phenomenon, then it must be more than the sum of its constituent parts. Ergo, culture must be measured at the resulting culture AND the constituent parts levels.

Clearly, putting your finger on what culture is in a robust, repeatable, measurable way is tough, but Kotter & Heskett showed that it could be crudely done in their 1992 book "Corporate Culture & Performance".

The challenge is to understand the constituent parts, how culture emerges from their interactions and then to identify appropriate measures.

Graham Hill
Independent Management Consultant