The 360 degree customer view is dead

I've never been entirely comfortable with the phrase "360 degree customer view". I remember hearing it for the first time in a Siebel sales pitch. The sales guy put up a slide with a customer on one side and a series of connectors - like spokes of an umbrella - connecting to all of the different silos of customer data - the call centre, the field sales force, the finance department and so on. The assertion that followed was the Siebel would connect all the silos of customer data allowing anyone who interacted with the customer to have a complete history of the customer. It was argued that greater customer insight, in turn, could be used to build stronger, more profitable customer relationships.

Thinking back to my early days as a CRM practitioner, I also remember the first CRM training course I attended, run by Francis Buttle. One module of the course described the inability of many organisations to understand their customers and think from their customer's perspective. The training course gave a case study of a Swiss bank who had launched a new savings product designed for pensioners. Now two caveats... firstly, I have no idea if the case study was a true story and secondly, I'll probably do it an injustice as I’m sure I don’t remember all the details. But if I remember correctly the jist of the story was that the Swiss bank had completed a market research exercise that suggested that pensioners in rural locations represented a large untapped market for savings products. They designed a new product, specifically designed for pensioners and they employed a marketing agency to come up with a tailored campaign to target pensioners. To ensure that bank staff would execute on the anticipated success of the campaign, the bank initiated a training program to teach their staff how to interact effectively with pensioners. They built booths in some of their branches and put on coffee and biscuits for their potential new clients. The new product launch was an unmitigated disaster. Despite the research that showed that Swiss pensioners had savings funds stashed under their mattresses and despite the large investments, the bank barely signed up any new customers. In desperation they undertook a research program to try and find out what went wrong. They travelled to villages in Switzerland and ran focus groups with pensioners. When they asked them why they were reluctant to take out the new savings products of the bank one theme emerged above all others - the pensioners were scared of getting mugged on the way to the city banks. With that insight the bank overhauled it's branch model and used large mobile banking vans to visit the local villages to interact with their potential clients on their terms. Knowing that security was an issue they also introduced an insurance policy to offer unlimited protection on savings funds stored with the bank. Again, I have no idea whether that story is true, I suspect some of it was embellished to make a key point of thinking outside-in from the customer’s perspective, but the story stuck with me.

So back to the "360 degree customer view", my unease with the term comes from that fact that although it may be possible to build a transactional view of all of a customer's interactions, orders, complaints etc with your company, those transactions only represent a tiny fraction of a true "360 customer view". A consolidated list of transactions with one company tells us nothing about how a customer is thinking or feeling at any given point in time (this changes constantly based on a whole range of factors that are entirely outside of our control). For example, a transaction that tells me that a customer had broadband installed, probably doesn't tell me that the engineer was late, rude and left a mess in the customer's living room. An inside-out list of transactions tells us nothing about a customer's dealings with competitors, their pain points, their value drivers and more importantly how these change, chameleon-like, according to the situation the customer is in.

Now before you ask, social media is not the panacea. Social media is not the missing link in the 360 degree view. Yes, of course you can supplement CRM data with social data and yes, this can sometimes give you more of an indication as to who the customer really is and what they really think. But, one of the dangers I see with adding social data to CRM is that it can make marketers act like kids in a candy store and it can perpetuate inside-out thinking. With so much data to slice and dice, it becomes even easier to perform a segmentation and blast more and more inside-out offers at customers (people aged 21-25, living in NYC, who wrote a product review of an MP3 player in the last month, who clicked on an add must surely want a targeted email offer for a pair of headphones so let’s keep spamming them???).

A harder position to take, but in my view, one that can yield better results (in the form of long terms profitable, win-win relationships) is one that seeks first to understand the things customers value, the journeys they go through and the critical moments of truth within those journeys. Second, to acknowledge that you can't control how a customer thinks, feels, buys, complains but you can give customers tools to help them create value for themselves and you can sense, respond and fix things when they go wrong. When I first heard the story of the Swiss bank all those years ago the simplicity of listening to customers, rather then making assumptions about them stuck with me. Today, we are awash with data, the challenge is in how we use it.

The three big challenges facing organisations investing in CRM today

There was a time when the main challenge facing an organisation investing in CRM was the amount of discount they could negotiate on their Siebel licences. That was a time, when for many companies, CRM was all about technology. A time when the original definitions of CRM like “building mutually beneficial customer relationships” were ignored in favour of technology bells and whistles. Today the market has matured. CRM buyers are pretty savvy – many were burnt by investing in CRM the first time round and are still suffering from the hangover. I’m often asked by clients who got things wrong with CRM a decade or so ago, how they can ensure that they get things right today. I see three big challenges that need to be addressed to ensure CRM success.

The first challenge I see is that “failed CRM” was all about value to management. People invested in sales force automation solutions in order to get better visibility over their sales reps, which in turn enabled better forecasting, better alignment of resources to priority accounts (in the current quarter) and in theory a reduction in the loss of account knowledge when a sales rep left the company. Alternatively, within Customer Service management attempted to enforce call scripts, the measurement of everything (like average call handle time), scripted cross-selling in every call, or enforced channel shift to reduce costs (instead of “your call is important to us” read “you may want to speak to an agent but our CRM system will push you to an IVR (which in turn will advise you to go online) because it’s cheaper for us”). To be successful CRM investments need to unlock value to a balanced group of stakeholders. At a minimum this includes management, front line users who interact with the customer and of course, let’s not forget customers! Unless you have a clear picture of how your CRM investments will help unlock value to those stakeholders (particularly customers!) you are simply pumping money into the CRM technology slot machine and hoping to win. Most sales people I speak to hate “failed CRM” because all it did for them was create 2-3 hours admin on a Friday afternoon. Most customer service people I speak to hate “failed CRM” because they felt uncomfortable reading the script, or having to cross-sell to an angry customer. But critically, most end customers I speak to hate “failed CRM” because all they wanted to do was speak to someone about their problem. Transitioning to an outside-in, customer-centric mindset and balancing your understanding of value is the first challenge.

Once you have a balanced view of stakeholder value, the second challenge you need to think about is the full range of capabilities that need to be improved in order to unlock that value. I frequently come across CRM business cases that show a clear and direct linkage between a technology investment and a business outcome with no consideration to the inter-connected capabilities that might get in the way. For example, making an assumption that investing in XYZ technology will reduce sales force admin time is fine, but assuming that sales people will use that time to open up new accounts may be questionable. For that to happen it may well be that incentives need to be changed, that new business development or solution selling skills need to be improved, or that the sales organisation is simply structured in the wrong way. Without addressing those broader but dependant capabilities, you simply cannot guarantee that CRM investments will release value.

Finally, most people I speak to these days about CRM face a delivery problem. “Failed CRM” was monolithic and big-bang. Implementations took many months or even years before users saw anything. On the whole, clients I speak to today want to embrace a more iterative, agile way of implementing but that’s not as simple as flicking a switch and becoming “Agile” (and certainly not as simple as buying a cloud-base solution). I’ve seen several Agile programs that started with the best of intentions but ended up in tricky situations as maybe the business didn’t quite understand the level active participation and involvement that would be required, priorities across different business stakeholders and technology were not properly aligned, the technology simply wasn’t particularly suited to an agile implementation, or the technology solution evolved into SaaS best of breed Hell (see Ray Wang's latest from CRM Evolution 2012 http://blog.softwareinsider.org/2012/08/14/event-report-crm-evolution-2012/. Agile done well is a delight – expectations are aligned through constant communication and progress is visible for all to see. Agile done badly is a pretty dangerous delivery approach – at its worst used to justify taking unnecessary short-cuts or avoid any planning. Transitioning to an agile delivery approach is the third challenge.

The three challenges are not exhaustive but I certainly see them repeated across a number of different clients and industries. What do you think is missing?

CRM Strategy interview transcript

Below is a rough transcript of an interview I gave to Chuck Schaeffer, CEO of Vantive Media, for CRMsearch.com You can download the interview as a podcast from iTunes here.

 

CS - Before we talk about designing and implementing CRM strategy, let’s start with a clear understanding of what we mean by CRM strategy. Can you define or explain what you mean when you reference CRM strategy?

LB - Let's start with defining CRM. For me the oldest and simplest definitions of CRM are still the best. There are 2 that I like: one is "treat different customers differently" and the second is "CRM is a business approach that aims to build long term, mutually beneficial relationships with customers" 

So CRM strategy for me is about forming a vision of where you want to get to with CRM, evaluating your current state and the strengths and weaknesses of your capabilities and then defining the path to achieve your goals. Typically a CRM strategy would look at improving a range of capabilities required to enable your vision (from technology to people to process) and then forming a prioritized roadmap for implementation.

CS - Has it been your experience that CRM strategy is changing or evolving?

  

That's an interesting question - on one hand, if you go back to the definitions of CRM that I previously gave then CRM as a topic has changed very little.

 

The problem is that for the first 15 or so years of the CRM market people approached CRM in a technology-centric way and an extremely inside out way. So a typical CRM strategy was about defining a future state that was a static destination 5 years in the future, enabled by a monolithic technology program. The over-riding ethos was one of command and control - CRM initiatives tried to control all customer facing data, processes and customer facing employees e.g. forcing them through a script or forcing them to enter their contacts into a database. CRM initiatives even tried to control customers (defining when customers bought e.g. end of quarter, and what service channels they used).

 

As understanding in the market has improved, the original definitions of CRM have really come back into fashion and so CRM strategy has evolved. I think people are going back to basics and are thinking if we really want to build “mutually beneficial customer relationships" then we need to focus on more the customer, rather than the technology and understand what the customer values from a relationship, what jobs the customer is trying to do when they interact with us and how we can help the customer do those jobs better than the competition. So I think what's changed in CRM strategy is an increasing importance of customer experience.

 

The second thing I think has changed is technology - both the technology that enables CRM systems (cloud-based services, flexible, modular) but also the technology that customers use to interact with organizations (over the last 10 years we've seen the rise of social media, mobile devices, apps). This trend makes it increasingly difficult to try and define a static destination as a CRM vision - the reality is that both consumer and enterprise technology is constantly changing so a CRM strategy needs to reflect that and really design for change from the outset

 

CS - How do you recommend business leaders go about designing and implementing their CRM strategy?

 

LB - 1. Create a compelling need for change - people have got to want the change. This could be a competitive threat, customer numbers on the decline, or an opportunity that excites people, but we need something that galvanizes people.

 

2. Get customer-centric, outside-in thinking into the definition of your vision. A good way of doing this is through customer journey mapping - looking through the lens of the customer at the jobs they are trying to do and the moments of truth they face in their journeys.

 

3.Clearly articulate that vision (which again, may not be a static destination) it may be a set of principles, but key is that people understand and buy into them.

 

4. Evaluate your existing capabilities (tech, people, process)

 

5. Form a prioritized delivery plan of which capabilities you need to improve (of course acknowledging that many are interlinked)

 

6. Start small, iterate and iterate and iterate!

 

CS - Is it necessary to first build a business case to support implementing a new or revised CRM strategy – and if so, what should that business case include?

 

LB - For me, CRM should be linked to an organizations corporate strategy. If the corporate strategy is to compete in the market with a differentiated service experience then CRM should be about enabling that and the business case should in turn be directly linked to those corporate objectives.

 

The types of benefits you would look for in CRM usually related to improved revenue and profitability from doing more business with existing customers for longer. But of course some CRM projects are justified with cost savings derived from channel shift or process efficiencies.

 

Ideally, when you think about benefits you should also think about value to everyone in the chain e.g. employees, customers, suppliers etc

 

CS - Do you find that implementing a CRM strategy often entails a cultural change in the business?

 

LB - Without question and that's the hardest challenge.

 

If you look at the rise of social media and big data - everyone is obsessed by the technology challenge of filtering through vast quantities of data, but to me the biggest challenge is an operating model challenge. I've seen countless organizations struggle with social media because it challenges their silos, their speed, their command and control mindset

 

CS - Do you find that there’s often a mismatch between what businesses think they do well and what they really do well - or between how businesses believe there customer relationships are as opposed to how customers would rate those relationships?

 

LB - yes - frequently.

 

One Pharma client I worked with was shocked to discover that their sales people were spending over 50% of their time on activities that their clients valued as low or insignificant. The top things that clients valued accounted for less than 10% of total sales activities

 

CS - if so, why the mismatch? And what do about it?  

 

LB - It's a difficult challenge.

 

First – you need to make people aware - in the example I've just given the CEO and sales director were shocked and that created a need for change.

 

But realistically many of these behaviors are ingrained in an organization - most sales people are still taught that the most important customers are the ones who are going to place an order this quarter and are measured ruthlessly in closing the deal before quarter end. It's a big shift in culture to prioritize long-term relationships and to do the right thing by the customer - both senior management and front line employees have to believe that it's the right thing to do

 

CS - When developing a CRM strategy, how and when does CRM software fit into the process?

 

LB - Quite simply technology is one enabling capability within a CRM strategy. It's unfortunate that the terms has become so synonymous with technology because the reality is that most organizations buy far more technology than they actually use and they cannibalize on the complimentary capabilities required to release the value from their investments 

 

CS - Do you find that its still a common scenario whereby companies implement CRM software before they’ve articulated a CRM strategy or defined their customer-facing business processes? Why?

I hope we're through that phase in the market but reality is I think it's still the case that people buy technology first and than 6 weeks / 6 months into a program they start to question why are we doing this? What's in it for customers? How can we prioritize our delivery sprints if don't have a clear picture of what's important.

 

CS - How is developing a CRM strategy influenced by disruptive technologies such as SaaS or the cloud, or social media or social CRM?  

 

LB - To some extend SaaS has made things worse - because it's so much easier for a line of business manager to purchase (outside IT) and get up and running with a siloed technology solution, SaaS can be seen as a silver bullet (which of course it is not!).

 

However, at the same time, SaaS  of course presents a fantastic opportunity to deliver some of the technology capabilities required to enable a vision much faster and in a more flexible way. Let’s be clear though - you still need a vision and strategy – there are no shortcuts here.

 

Social CRM has reinvigorated CRM because it has created a compelling event for most organizations to change. It demands the acknowledgement of customer power and control which in turn demands outside-in, customer experience thinking.

 

CS - When CRM strategies fail, what are the most common reasons they fail?

 

LB - In my experience most tend to blame the technology but technology is rarely to blame. I wrote this piece on “6 ways CRM projects go wrong” which covers reasons for failure like the inside out mindset, “analysis paralysis”, “once bitten twice shy”.

 

CS - If we look ahead a little bit, what changes do you suspect we’ll see in terms of creating, implementing or refining CRM strategies?

 

Actually I think we will see a theme of back to basics thinking on relationships. It’s easy to get caught up in the hype of a new technology but the reality is that people not technology build relationships and healthy relationships are never one sided.

 

The second theme I see is the pressure to try and design for change. It’s clear that product life cycles are getting shorter and shorter and consumers are constantly swarming to the latest device, social network or app. We have unparalleled ability to interact with consumers in new ways and learn vast amounts about them – they challenge is how we apply that insight to the business and how fast we are able to respond.

Fixing Sales Force Automation

For the past 15 years one of the most common causes of Sales Force Automation project failures has been that they have added approximately zero value to users. Most projects prioritized sales management first and sales people a distant second. SFA projects aimed to imprison sales people; tracking their daily activities, forcing them to give up the knowledge, scripting them through a sales process and creating admin for them. Is it any wonder that the majority of users treated these systems with utter contempt? I have spoken to countless sales people who looked upon their SFA systems as 2-3 hours of admin time per week, usually on a Friday afternoon.

Sales people who find themselves the victims of bad SFA implementations typically enter the bare minimum amount of information required to cheat their managers into thinking they were using the system effectively, paying particular attention to working out how best to game and not commit the ultimate sin of over-forecasting a deal. Despite the millions invested in SFA applications rogue pipelines in Microsoft Excel complimented by to-do lists on scraps of paper arguably remain the most widely used SFA platform today. Unfortunately this creates a vicious circle of failure. As soon as management start to mistrust the forecast coming from their SFA reports, they too start finding other ways of improving forecast accuracy. They arrange daily or weekly calls with sales people, drilling down on every aspect of a deal, mentally adjusting their forecast figures up or down.

 

So how do we fix this issue? Most successful CRM projects now adopt an approach of trying to help customers fulfill their needs or wants – in other words the jobs they are trying to do. If we can help customers create value and be successful then we stand a much greater chance of building a mutually beneficial relationship. Exactly the same principle needs to be applied to employee sales people. When embarking on an SFA project we must understand how to create value for a sales person and one of the easiest ways of creating value is through information.

 

Several years ago I worked on an SFA project for a pharmaceutical company in Australia. Their typical profile of a sales rep was a 50-60 year old who travelled vast distances around country Australia, visiting pharmacy customers, whom they had known for many years, selling them over the counter medications. Most of the reps were superb sales people – they had amazing relationships with their customers, knowing every detail about the lives and businesses of the people they were dealing with. Two major problems existed. Firstly the reps had to do quite staggering amounts of admin (mainly faxing orders to wholesalers and chasing orders from wholesalers). Many reps stopped productive sales work at lunchtime and spent each afternoon doing admin. Secondly, the reps had no information about their customers other than that in their head. They had no idea which customers were the most profitable, which had the highest share of wallet, which switched suppliers frequently based on price promotions or what other dealings their customers had with the company e.g. with Finance. Finally, for additional context a significant proportion of the reps (say 20%) had very little IT experience. My advice to them was that they badly needed SFA but that SFA would kill their sales force. Instead of blindly rushing to roll out a laptop based SFA solution that at least 20% of the reps would not have been able to use, we took some time to understand the needs of the reps and how they worked. Of course when we spoke to them (and also their clients) they all wanted to reduce their admin time, they all wanted to be alerted when one of their major clients failed to pay on time, they all wanted to spot new opportunities to upsell additional products to their clients or find new opportunities, they all wanted to manage their time better and spend time on the things the activities that would increase their commission stream. In the end we implemented an SFA solution. But it was a very different SFA solution than you probably have in mind. Sure, it had many of the same features and functions but they were embedded within a simplified solution that added value to the rep and that the rep would actually want to use. For the 20% of reps who had literally never switched on a PC in their lives we set up a sales support desk. They carried on taking orders with pen and paper but before they visited a customer they phoned the sales support desk to get an update on any missing orders or payments. After the visit they phoned back and the sales support clerk typed in the orders as fast as they could speak – no faxes, no re-keying, no admin.

 

Now of course the example above is rather crude. The project won an award for the best CRM implementation in Australia (I think in 2003), but frankly we had a fairly easy opportunity to generate huge benefits given the lack of effectiveness within the sales force. Most sales forces today are far more sophisticated but similar problems still exist around admin time, lack of science in how reps treat different customers and lack of intelligence. Fundamentally reps in more sophisticated sales organizations still want the same things – “make it easier for me to sell”, “reduce my admin burden and help me make my commission targets”. In today’s “big data” world information and insight is key but we cannot expect our sales people to turn into data analysts. We must find ways of blending insight into SFA applications in ways that genuinely add value to sales people. For example our SFA systems should hide complexity of front / back office integration but:

 

• Supplement account knowledge, for example with information gleaned from social networking sites e.g. Fred used to work with Joe at ACME, he writes a blog about financial fraud etc.  Information from social networking sites can be valuable in helping a sales person find and qualify a new opportunity or understand the relationship networks around a target account. Take a look at this whitepaper from InsideView for more information: “Sales 2.0: Tap into Social Media to drive Enterprise Sales Results”.
• Alert sales people to potential new opportunities based on patterns of what other customers are buying or what other successful reps are selling.
• Show sales people how they are doing against targets and model commissions and how these will change based on different levels of quota achievement.
• Predict the revenue and profitability impact of changing focus to a different account or set of activities.
• Show how different competitors are impacting discounting, credits & losses and show how this impacts commission.
• Model the impact of complex pricing changes to help structure deals better for customers, provider and of course sales rep.
•  Alert the sales rep to back office information that could be crucial in structuring a deal e.g. supply chain information that might prevent an order being shipped on time. This ensures that sales people make promises that they can deliver on, which in turn makes them more successful and saves them time and effort in re-visiting bad deals.
• Connect the sales person to internal social networks and knowledge bases to find knowledge experts, peers or content easily. This can be extremely valuable for competitive information or sharing case studies of wins and losses.

 

SFA implementations are tough. Sales people are notoriously protective of their account information and insight and bitterly resistant to admin and control, but information can be a key to unlocking value for both organization and rep.

 

This article was originally written to support SAP’s 21^st Century Sales Warrior Guide. See http://saleswarriorguide.com/

Fixing Sales Force Automation

For the past 15 years one of the most common causes of Sales Force Automation project failures has been that they have added approximately zero value to users. Most projects prioritized sales management first and sales people a distant second. SFA projects aimed to imprison sales people; tracking their daily activities, forcing them to give up the knowledge, scripting them through a sales process and creating admin for them. Is it any wonder that the majority of users treated these systems with utter contempt? I have spoken to countless sales people who looked upon their SFA systems as 2-3 hours of admin time per week, usually on a Friday afternoon.

Sales people who find themselves the victims of bad SFA implementations typically enter the bare minimum amount of information required to cheat their managers into thinking they were using the system effectively, paying particular attention to working out how best to game and not commit the ultimate sin of over-forecasting a deal. Despite the millions invested in SFA applications rogue pipelines in Microsoft Excel complimented by to-do lists on scraps of paper arguably remain the most widely used SFA platform today. Unfortunately this creates a vicious circle of failure. As soon as management start to mistrust the forecast coming from their SFA reports, they too start finding other ways of improving forecast accuracy. They arrange daily or weekly calls with sales people, drilling down on every aspect of a deal, mentally adjusting their forecast figures up or down.

 

So how do we fix this issue? Most successful CRM projects now adopt an approach of trying to help customers fulfill their needs or wants – in other words the jobs they are trying to do. If we can help customers create value and be successful then we stand a much greater chance of building a mutually beneficial relationship. Exactly the same principle needs to be applied to employee sales people. When embarking on an SFA project we must understand how to create value for a sales person and one of the easiest ways of creating value is through information.

 

Several years ago I worked on an SFA project for a pharmaceutical company in Australia. Their typical profile of a sales rep was a 50-60 year old who travelled vast distances around country Australia, visiting pharmacy customers, whom they had known for many years, selling them over the counter medications. Most of the reps were superb sales people – they had amazing relationships with their customers, knowing every detail about the lives and businesses of the people they were dealing with. Two major problems existed. Firstly the reps had to do quite staggering amounts of admin (mainly faxing orders to wholesalers and chasing orders from wholesalers). Many reps stopped productive sales work at lunchtime and spent each afternoon doing admin. Secondly, the reps had no information about their customers other than that in their head. They had no idea which customers were the most profitable, which had the highest share of wallet, which switched suppliers frequently based on price promotions or what other dealings their customers had with the company e.g. with Finance. Finally, for additional context a significant proportion of the reps (say 20%) had very little IT experience. My advice to them was that they badly needed SFA but that SFA would kill their sales force. Instead of blindly rushing to roll out a laptop based SFA solution that at least 20% of the reps would not have been able to use, we took some time to understand the needs of the reps and how they worked. Of course when we spoke to them (and also their clients) they all wanted to reduce their admin time, they all wanted to be alerted when one of their major clients failed to pay on time, they all wanted to spot new opportunities to upsell additional products to their clients or find new opportunities, they all wanted to manage their time better and spend time on the things the activities that would increase their commission stream. In the end we implemented an SFA solution. But it was a very different SFA solution than you probably have in mind. Sure, it had many of the same features and functions but they were embedded within a simplified solution that added value to the rep and that the rep would actually want to use. For the 20% of reps who had literally never switched on a PC in their lives we set up a sales support desk. They carried on taking orders with pen and paper but before they visited a customer they phoned the sales support desk to get an update on any missing orders or payments. After the visit they phoned back and the sales support clerk typed in the orders as fast as they could speak – no faxes, no re-keying, no admin.

 

Now of course the example above is rather crude. The project won an award for the best CRM implementation in Australia (I think in 2003), but frankly we had a fairly easy opportunity to generate huge benefits given the lack of effectiveness within the sales force. Most sales forces today are far more sophisticated but similar problems still exist around admin time, lack of science in how reps treat different customers and lack of intelligence. Fundamentally reps in more sophisticated sales organizations still want the same things – “make it easier for me to sell”, “reduce my admin burden and help me make my commission targets”. In today’s “big data” world information and insight is key but we cannot expect our sales people to turn into data analysts. We must find ways of blending insight into SFA applications in ways that genuinely add value to sales people. For example our SFA systems should hide complexity of front / back office integration but:

 

• Supplement account knowledge, for example with information gleaned from social networking sites e.g. Fred used to work with Joe at ACME, he writes a blog about financial fraud etc.  Information from social networking sites can be valuable in helping a sales person find and qualify a new opportunity or understand the relationship networks around a target account. Take a look at this whitepaper from InsideView for more information: “Sales 2.0: Tap into Social Media to drive Enterprise Sales Results”.
• Alert sales people to potential new opportunities based on patterns of what other customers are buying or what other successful reps are selling.
• Show sales people how they are doing against targets and model commissions and how these will change based on different levels of quota achievement.
• Predict the revenue and profitability impact of changing focus to a different account or set of activities.
• Show how different competitors are impacting discounting, credits & losses and show how this impacts commission.
• Model the impact of complex pricing changes to help structure deals better for customers, provider and of course sales rep.
•  Alert the sales rep to back office information that could be crucial in structuring a deal e.g. supply chain information that might prevent an order being shipped on time. This ensures that sales people make promises that they can deliver on, which in turn makes them more successful and saves them time and effort in re-visiting bad deals.
• Connect the sales person to internal social networks and knowledge bases to find knowledge experts, peers or content easily. This can be extremely valuable for competitive information or sharing case studies of wins and losses.

 

SFA implementations are tough. Sales people are notoriously protective of their account information and insight and bitterly resistant to admin and control, but information can be a key to unlocking value for both organization and rep.

 

This article was originally written to support SAP’s 21^st Century Sales Warrior Guide. See http://saleswarriorguide.com/

Moving from tactical social media experiments to social business transformation

The elephant in the social media room at the moment is that most corporate social media initiatives to date have been tactical experiments. Of those, few have generated meaningful business results. Sure, people have built up Facebook Fans and Twitter followers or they have launched the odd viral video on YouTube. They have claimed these as a success, but in reality these metrics should never be the end goal.  The age of tactical experimentation has been characterized by:

• A focus on so-called “engagement metrics” i.e. likes, followers, re-tweets etc. over real business outcomes.
• An obsession with vanity buzz monitoring, with far too little attention given to data accuracy, data integration, insights and, most importantly,  action.
• An explosion of rogue corporate social media accounts, created to support any promotion, product, department or individual employee who wants to add a social element to their portfolio (a recent client had at least 114 disconnected Facebook , Twitter and YouTube accounts a recent Forbes article suggested that organisations with over 1000 employees likely have over 170 social media accounts http://tinyurl.com/6peo9ox
• Silos between corporate social media accounts, silos between social media accounts and enterprise systems and silos between customers, employees, departments and partners.

A relatively small number of companies have pushed things further and achieved real, transformational results. Start-ups like Giffgaff, who have pushed the concept of customer community in control further than anyone else in the Telco industry with tangible results (their customer service costs are an estimated 4 times below industry average and word of mouth acquisitions are around 5-7k per month). Zappos (now owned by Amazon), whose focus on service and experience pioneered an entire movement called Delivering Happiness.  Or large organisations like Proctor & Gamble whose Connect-and-Develop program allows idea co-creation with third parties and enables them to crowd-source solutions to fix some of its most complex R&D issues. Similarly, the Dutch airline KLM, who have embraced social with great success. Their KLM Clubs China & Africa have allowed them to build communities for entrepreneurs travelling to emerging markets with KLM, creating additional value for club members way outside what you would usually expect.  Their campaigns, like “Surprise” and “Meet and Seat” are both innovative and differentiate the airline’s brand in a crowded market place. They are not simply one-off social campaigns, “social” is more widely embedded within KLM’s DNA. 

What ties these companies together is that:

• They are an over-used collection of examples – it’s sad but true; social business success is still not the norm.
• Their success has moved beyond a single social media campaign or departmental initiative – P&G’s success for example relies on connecting Marketing with Product Development, GiffGaff ties together Marketing, Sales & Service - all are led by their community. Zappos pioneered the concept of “everyone is in service”.
• They have not just adopted “social” technologies, but they have embraced a social mindset. One of outside-in, customer-centric thinking 
• Often they have not referred to the things they are doing as “social” – after all, we have always been “social” - rather, they talk about higher-principles like “customer in control” or “delivering happiness”.

Most large enterprise clients I meet acknowledge that the age of social media experimentation is now coming to an end. They want practical advice as to how to move from social media experimentation to social business transformation. Having worked for the last few months with a FTSE 100 client on just such a challenge, I can say with certainty that this is not an easy task. Social can be in direct conflict to many ingrained aspects of a firm, including:

• Business model – the ability to digitize products and distribute them at mass scale or to a micro niche (both enabled by social networks) can radically challenge an existing business model.
• Culture & mindset – one thing that is clear from the failure of many social media experience is that applying an inside-out mindset to social can backfire spectacularly. Think of the way in which some companies have tried to control everything that is being said about them online – deleting negative comments or worse still posting fake reviews. Inevitable this mindset of command and control has not worked in the digital world.
• Technology – The pace of change within social technology is so fast that it places huge pressure on the traditional IT operating model. See my post on “What comes next after Facebook and Twitter. The challenge of keeping up in a constantly changing digital world.”
• Business Operating Model – perhaps the toughest and most under-appreciated challenge of social is to the business-operating model. They way people are incentivized, reporting lines, business objectives, ways of working can be placed under intense pressure by social. I have seen countless scraps between departments trying to “own” social media as well as finger pointing between silos each blaming the other for a failed campaign.

So how do you progress? Of course every company will be in a slightly different situation, but typically it’s probably worth at least getting a handle on all the tactical experiments you currently have in progress; at the very least understanding who is doing what, what’s working and where the dangers are. Secondly, any transformation requires a compelling need for change; one that is clear, visible and supported at both exec and employee levels. Often the compelling event may be external, for example from customers demanding change, from a new market opportunity that galvanizes action or from the threat of a disruptive competitor. Thirdly, start with people, mindset and culture before tools (most people have over-invested in tools and under-invested in the complimentary capabilities required to obtain value from the tools – I know of a firm with 6 internal collaboration tools who still struggles to collaborate internally). In particular focus on the challenging mindset shift from inside-out to outside-in, starting with the customer. Fourthly test, learn and iterate. – another concept that is much easier said than done in most organizations where short term success is celebrated and failure punished.

The path to social business success is certainly not an easy one, as demonstrated by the lack of end-to-end examples that exist today, but as we move through the social wave of hype I have no doubt we will see more successes and less throw-away experiments.

This post was written to support the Social Business Strategy Summit 31^st May 2012

Why CRM Idol matters to EMEA software companies

Earlier this week Paul Greenberg announced the second season of CRM Idol. This year the competition has gone global with categories in the US, EMEA and Asia / Australasia. I’m delighted to be one of the 4 primary judges in EMEA. Last year was an eye-opening experience both for contestants and judges alike in EMEA. BPMonline, a SaaS vendor combining CRM and BPM, blew the panel of extended judges away with their final presentation and won the competition. To be frank, I’d never heard of BPMonline before CRM Idol 2011, but in my mind that’s the point – I’d been missing out.

Paul Greenberg introduced CRM Idol, in his words, to “give something back to the CRM industry” and to “give up and coming CRM vendors a chance to shine” that they wouldn’t normally get. Paul has given more to the CRM industry than anyone I know, so he really doesn’t need to worry about the first point, but his second point hits the nail on the head. Having spent nearly 15 years working both for and with enterprise CRM software vendors I know full well that much of the innovation that happens in the CRM market happens outside the development labs of the big few. That’s not to say that they don’t innovate, but many have major development challenges to integrate newly acquired products, re-platform their on-premise solutions to SaaS, migrate customers from old versions of their product to the latest release – these initiatives quite rightly suck up vast amounts of development resource and ensure they stay competitive in the market.

By their very nature, start-up software vendors simply don’t have these challenges. They start from a clean sheet of paper, using the latest technology and standards. They are agile in every sense of the word responding to customer and market trends in near real time and often releasing new iterations to their products on a weekly basis. They tap into the latest thinking in open-source communities, launch-pads and co-working facilities. In short, the start-ups have an opportunity to do things that large enterprise software vendors can only dream of. Many create new categories of software and go on to great things, others compliment the eco-systems of the big few providing niche, value-added solutions. But each face a challenge 12 months or so into development – that of getting noticed in a crowded market.

Although the CRM software market has historically be centered around Silicon Valley (Siebel, Salesforce.com, SAP Labs Paolo Alto), Europe is blessed with some real hot-beds of technology innovation. From web developers in Tallinn to semantic scientists in Tel Aviv, to IP Telephony pioneers in Helsinki, EMEA is a great place to be. EMEA also has a thriving Digital heart in London’s Shoreditch around the so-called Silicon Roundabout that has given birth to hundreds of tech start-ups like Tweetdeck, Dopplr and Last.fm. CRM Idol gives those vendors connected with the CRM industry a chance to show their wares to 70 or so of the most influential independents in the CRM / SCRM market – people like Denis Pombriant, Esteban Kolsky, Ray Wang, Michael Fauscette & William Band have been driving thought-leadership in the CRM industry for the best part of 20 years. In addition, there are some valuable prizes to be won like free consulting days, pitches to venture capital firms and free lead-gen webinars.

So if you are a small, innovative vendor in EMEA connected with the CRM market I would encourage you to take a look at the entry criteria for CRM Idol 2012 and register online. What have you got to lose?