With the dog days of August upon us, I find myself with a little extra time on my hands. Translation: everyone on my team is on vacation except me, so I’m taking the opportunity to relax and “only” work a normal 40 hour per week schedule. As a result, I’m having much more “soak time” than usual – time to let ideas marinate and absorb feedback. As a result, I've had time to soak on an idea which I introduced last month around IT transformation and IT organizations more “customer centric.” I'd like to expand on that a bit this month.

In the past, I would have argued that this meant getting closer to customers of the company, rather than internal customers of IT. However I’ve come to the realization that it is impossible for IT to get closer to customers unless they are perceived as being integral to the business just the way any other business unit is integral to the business.

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The impact of this month’s theme, “Using Technology to Power-up Customer Management,” on IT organizations is not trivial. While it’s all well and good to plan a CRM technology “ecosystem” (a reference architecture to us technologists), the fact remains that CRM is just one of many priorities challenging the IT agenda. Indeed CRM is a challenge, but it’s not the biggest challenge in IT today. That award goes to the general category called “the business value of IT.”

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Jane Doe is in the market for a new vehicle. She's technology savvy and is using the Internet for research. She usually leases her vehicles (every two to three years) from the same dealer. While she's not unhappy with the dealer, she's not particularly loyal, either.

Consider the cross-channel "Richter Scale" in the graphic below that illustrates Jane's process for purchasing a vehicle. The green line represents her activity from the perspective of the dealer's web site, while the red line represents all activity from the consumer's point of view. Jane shows up to the dealer as Consumer ID ABC123, though of course, the dealer doesn't know it's Jane.

If you were the dealer, you could see from this data only that Jane has been spending a fair amount of time looking at economy cars and SUVs. But you couldn't tell how long she has been actively engaged in new vehicle research or what else she's been doing.

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I think most of us would agree that a customer strategy often involves technology enablement. The thing is, the urban legends around CRM technology failures persist. Sure, most technologists will tell you that CRM projects have some risk not present in other back-office oriented projects (e.g., customer exposure, needing to herd sales and marketing cats). But CRM projects are not THAT different from other large scale enterprise implementations in terms of the required blocking and tackling. Us pundits tend to have lots of ideas about how to risk-proof CRM technology projects, but I don’t hear a lot of advice relative what, to me, is the most important risk-mitigating element: how the (often virtual) program team works together.

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The CRM end-game is improved economics between buyers and sellers. Discrete activities, such as great customer service, segment marketing and product cocreation are simply means to that holistic end. So, for CRM economics to work, you must optimize for the integrated CRM system—the customer lifecycle—rather than for a single discipline, such as marketing.

If you, instead, optimize the economic performance of individual CRM silos (such as sales, marketing and service), you may inadvertently sub-optimize the whole. What marketing department, for example, wouldn't consider its brand-new online marketing implementation wildly successful if it increased the number of leads passed to sales by 150 percent? None I know of. But what if the upshot to the entire CRM system was that all the additional leads, qualified though they might be, over-taxed the sales organization to the point where prospects who opted in to the online campaign never received a sales follow-up? And what if the prospects ended up thinking that this company didn't have its act together? So, in that case, optimizing that one marketing silo would turn out to be not so successful after all. Not to mention very expensive.

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If we want to create employee fans who will then “sell” to end customers, then we need to make actually turn those employees into fans! And that’s not so easy when it comes to IT.

It’s a fact (at least in my mind) that IT projects with good project management get better results than projects with poor or no project management. Can we say the same for CRM? In other words, if IT projects employ CRM techniques, will there be a better outcome? I say YES!

We need to recognize that most IT projects support many types of “customers” ranging from the external customer to internal users, and not the least of which is the company itself. Further, if we believe that CRM is a business strategy where the customer — not a particular technology, business unit, department or function — is the focal point, then we must embed CRM strategies into our project plans. My experience repeatedly demonstrates that applying CRM principles to projects yields far superior results. To this end, I offer two sets of activities that IT organizations can use to orchestrate their project efforts.

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I think 2008 will be a year of profound technology change insofar as enterprise CRM early adopters are starting to feel real pain around legacy applications – which is to say anything that’s been in production for more than 5 minutes. Said pain stems from a variety of places, but it includes the impedance mismatch between application modernization initiatives (with which the Global 2000 will be rife in 2008 due to fundamental shifts in application architecture) and the vast amount of customization applied to packaged CRM applications when they were implemented. CIOs are stuck between the proverbial rock and a hard place when it comes to modernization: re-implement major customization to support indoctrinated but perhaps not business-differentiating processes or implement vanilla, possibly at the expense of competitive advantage. Making these tough design choices is as much about an organization’s culture as anything else. As such, I posit that CIOs must add “change agent” to their repertoire of personas.

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When clients ask me about global CRM, it's almost always in the context of software: Which applications support "internationalization," with features such as double-byte character sets, UI translations, on-demand workflow and flexible currency tables? Sometimes a client will even go so far as to wonder about the data implications of global CRM, especially when the goal is to have a global customer master. While these are all good questions, they're not the right questions to successfully enable global CRM.

I recently worked with an insurance industry trade group whose membership consisted of insurance companies around the world. Its member companies in China had requested some education on CRM, and this group, based in the United States, engaged me to review a "CRM in the insurance industry" training program. I tried to help the group understand that its educational concepts needed to reach beyond "CRM in the insurance industry" to examine "CRM in the insurance industry in China." In other words, its program needed to apply a "customers in China" lens on top of its insurance industry lens to really help its Chinese member companies get CRM right. Apply this notion to any multinational company and the argument goes that "CRM in Industry A" must be supplanted with "CRM in Industry A in Country 1," "CRM in Industry A in Country 2," etc.

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It was a cool, crisp New England autumn day when I got word from my client (John, the senior vice president of sales at a midsize professional services company) that he was finally ready to address his underutilized, much maligned $4.8 million sales automation application. I remember the details of the weather so clearly because we had been in an offsite leadership meeting where I was brought in to help the leadership team conceptualize a customer strategy.

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A client I hadn't worked with for several years recently emailed me, asking me to review his organization's CRM strategy. The client (let's call him Bill), the chief architect at a large California utility, said that, while the company would not replace its existing customer databases (very expensive customer information systems), it would be evaluating new user-facing applications. Bill mentioned two popular customer service applications and asked which one I'd recommend.

After convincing myself that this must be a trick question—anyone who's ever worked with me knows I don't buy into the "because they're household names, one must be right for you" game—I called Bill and asked (nicely, I swear) if he'd forgotten everything I'd ever taught him. Turns out that, no, he hadn't forgotten completely. He just needed a little "reminder" about the right way to provision CRM technology. Where "reminder" equals a stern but loving lecture.

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