Structuring the Organization for Customer Success

Carol Smalley
Managing Editor, CRMGuru
Member

Posted 20-Mar-2003 03:45 AM
NOTE: Posted by Editor Carol Smalley on behalf of Keith Voss.

I am looking for some case studies/examples of how companies set up their organizational structures to support CRM strategy. I've heard some companies form a CCO (Customer Care Officer) position, while with others the function resides in a central marketing function. We do not have a central marketing function. Each of our four businesses has its own customers, data, sales and marketing teams.

Any examples or writings on this subject would be appreciated.

Thank you.

Carol Smalley
Managing Editor, CRMGuru
Member

Posted 20-Mar-2003 03:48 AM
NOTE: Posted by Editor Carol Smalley on behalf of Dominique Foucart[dfoucart@mail.mobistar.be]

We just reorganized our company in order to better focus it on its customers.

Our former organization was fairly classical with Marketing, Sales B2C, Sales B2B, R&D, IT, Customer Support & Services as main operating entities. What we did is to create three groups of activities:

"Technical Customer Solutions" (Product Marketing, R&D, IT development),

"Customer Services Operations" (Customer Support & Services, Technical Operations, IT Operations),

leaving aside the pure Distribution Network Management, Corporate Sales and Market Marketing activities.

The expected benefit lies mainly in the complete integration of the Customer Support and Services activities with the Production Chain; this requires a complete redesign of the processes, since the reorganization also includes a new definition of the Customer that prevent any usage of the former "internal customer" logic. All business processes are currently reviewed from the perspective of the Customer. As an example, in the former organization, trouble management was scattered between the Customer Assistance Desk and the Technical Operations, leading to up to five versions of the same "trouble ticket," depending of who was handling it (Customer Hotline, Operations Control, Technical Back-Office, IT 3rd level or R&D 3rd level). In the new organization, we can ensure that a Customer Problem will be visible and followed up through one single line of action.

Whether this will work or not is still unknown, but we are convinced this is a clear step toward a more Customer Centric organization.

Dominique Foucart
Head of C/PRM Business Domain
http://www.mobistar.be

Edwin Setzpfand
Member Council
Member

Posted 20-Mar-2003 06:12 AM
We are not in a similar situation as Keith Voss describes, but referring to the brief description of his situation I think that it is hard to be successfully customer-centric while "each of [the] businesses has its own customers, data, sales and marketing teams".

How can customers really feel themselves at the centre of the companies attention when the "look and feel" can be different, depending on the business they talk to?

I don't know (because there's very little about the actual organisation in the posting) how one could set up a workable co-ordination/synchronisation between businesses to achieve a form of "pseudo" customer-centeredness.

In a way the answer maybe is in the first line of the posting: ".. organizational structures to support CRM strategy."—If the strategic (!) choice has been made to go for "CRM" the organizational structure must follow from that, instead of the other way around. Appointing a CCO then is just a start.

If talking to the customer "with one mouth" lies at the heart of customer-centered CRM (as is described in so many excellent books and reports about CRM) then the rest follows from that, and having one marketing channel to begin with.

Data about the customer (or "parties" when one expands the focus to also include other stakeholders, not only customers, but also suppliers, shareholders, employees, agents, etc.) can reside in several (distributed) databases, but virtually it should be one in the end. In an ideal situation every employee should be able to have the same 360-degree picture of the customer (as far as allowed/applicable for his role/position). This then "mirrors" the situation in which a customer always perceives the same "look and feel" of the company, whatever channel he/she uses, or whether he does it from home or from the office.

To refer to the question at the very beginning of your posting .. I cannot hand complete and applicable case studies, but there are plenty examples in the literature (just browse through CRMguru, for instance).
Furthermore, whatever is in the case studies/examples will be difficult to translate to one's own situation.

My best advice maybe is to contact one of these 5* CRM consultancy firms (or another one, till you really feel that You are truly being treated from a customer-centered approach ...).

Success!

Edwin Setzpfand
The Netherlands

[ESetzpfand-AT-ftnetwork.com]

[This message was edited by Edwin Setzpfand on 27-Mar-2003 at 01:37 AM.]

Bill Brendler
Member

Posted 20-Mar-2003 08:14 AM
The structure that works the best is a cross-functional team-based design. There are a number of examples of this working well. The key to putting this in place is whether you have the right culture to ensure it works.

Bill Brendler

Graham Hill
Guru
Member

Posted 24-Mar-2003 02:04 AM
Dominique

The answer to Keith Voss' question raises a couple of interesting challenges. The first of them is getting beyond the mind-set that re-drawing the organisation structure is the same as reengineering your organization. It isn't. Any organisation is a little bit like an iceberg. The proud bit you see sticking above the waterline (the organization structure) is a lot less important in the bigger picture of things than the much larger unseen bit that sits under the water (the combination of coordination roles, work teams, personal networks, etc, often called the ‘shadow system'). In any organization, it is the shadow system that is responsible for much of the work that gets done and how it gets done.

Keith's organization seems like a traditional case of what is known as a ‘divisionalised corporation'. This type of structure was developed in the 50s at General Motors as a way to take individual automobile brands to market. Head Office was supposed to take care of coordination. Although it was held up then as the ultimate organizational structure, we now know that not to be the case.

Although the organization may need radical surgery, I don't know enough about it to see if integration with production, as you suggest, is the correct answer. Even if it is, you don't need to start everything with an organization reengineering project that would have a high probability of failure if the whole business wasn't reengineered at the same time. You can start by getting the marketing, sales and service people to talk to each other more frequently. This could be through encouraging individual staff to leverage their own personal networks to share information with ‘official' support. If that works well, you can develop cross-functional work teams across the divisions to move things to the next step. The key thing is sharing information to the right people in a timely manner and starting to develop a collaboration mind-set. Research as shown that just sharing information alone doesn't provide any business advantages in the long-run. That only occurs when groups start to collaborate together to develop a way forward that meets the organisation's goals. There are a number of further organizational development steps that you can take that are set out in Jay Galbraith's excellent book on Redesigning Multinational Corporations.

The second challenge is getting people beyond the mind-set that the answer to their problems is simply a customer-centric organization. As over 15 years of research on market-orientation has found out, customer-centricity by itself is a sub-optimal strategy that produces inferior business results compared to a broader market-orientation. Indeed, the wholesale move to a customer-centric organisation structure often introduces other problems just as great as the organisation-centric structure your organisation currently has, or the more common product-centric structures that most organisations still have.

Although it is difficult, a balance has to be struck between customer-centricity, product-centricity and channel-centricity (albeit with a somewhat broader remit than most traditional channel definitions). The issue is how you organise to get the right product offer (product-centricity), to the right customer (customer-centricity), at the right touchpoint (the real level of channel-centricity), at the right time. The same goes for sales and service. Very few organisations have really understood this yet, or the benefits that t can accrue (up to 25% uplift in ROI). It requires an analytically detailed understanding of customer behaviour over a short timespan (6 months to a year depending upon industry) and the organizational flexibility to respond very rapidly to marketing, sales, service and product consumption opportunities.

You are right; this does require integration with production, but that is not the heart of the matter. The real heart of the matter is getting the right product offer to the right customer at the right touchpoint at the right time. And then ensuring that the rest of the sales, service and product consumption touchpoints in the customer experience to work in the same informed way. Everything else flows from these fundamentals.

Graham Hill
Independent CRM Consultant