CRM is all about the customer.
Today, 91% of businesses with over 11 employees use CRM*, Customer Relationship Management.
Since its early adoption in the late 90's, package software companies are offering CRM functionality, either as part of their ERP package (Oracle, SAP, etc) or in a standalone system solution (Salesforce, Microsoft, Adobe, etc).
The concept of CRM arises (at least for B2B) from the idea that acquiring and managing customers should be systematized in order to capture and leverage customer data: contacts, opportunities, spend values, etc.
CRM is all about the customer.
But what happened before CRM?
So what makes sales and marketing teams contact one customer vs. another?
Typically, businesses aim at growing market segments where they see long term benefits for their shareholders and stakeholders, whatever the market segment : product, service, end-use market, channels, geography etc., it is logical to think that they choose market segments which are optimally aligned with their ability to deliver long term returns.
So at what point before the CRM activity kicks-in, are decisions made to choose a direction? Which customer or set of customers should be targeted ? or in simple terms, where to go?
Where to go? what is the destination?
This is where companies think...STRATEGY
Executive teams in charge of Strategy will set the destination, where they believe the company is and/or should be (‘Where to play - How to win’!); it is called strategy design. The challenge with strategy design is that most of the time, companies don’t know what to design, consequently picking a general direction based on summary market data and then jumping into commercial activation, therefore into CRM.
Planning for strategy should always starts where Product and Market are brought together to form generic strategy, a combination of business data, knowledge and actions.
Connecting business strategy to CRM
When Business Strategies are connecting to CRM, then activities are driven from strategy design. This makes the strategy more tangible so that product/service offerings and market/customer needs are brought together to form a more effective generic strategy. Generic strategies and customer data leads to customer specific strategies which focus commercial activity to deliver optimal results, revenue growth.
Specifically, generic strategy provide the framework content of product/service offering into market segment; value based mapping of trading partners, vision of future evolution of market position, SWOT and Roadmap. By aligning customer spend, organization structure and responsibility to generic strategy, customer commercial activity become embedded into the framework content; consequently activity become standard CRM execution.
Generic strategy aligned with customer data (responsibility, spend, structure) create the foundation to enable successful commercial activity and business win.
Connecting CRM back to business strategy
Either is through revenue loss, unsuccessful opportunity development, low probability of success, lack of contact qualifications, inability to obtain relevant customer data; all these may derive from the simple fact that business strategy (Product / Market) is unclear, unknown or even not available to business leaders.
Business strategy should recognise that target customers have different needs, wants, desires, capabilities and resources. The business strategy if unclear will not reflect this but CRM should enable this reflection to be done during the process of strategy development and post strategy implementation to gauge whether the strategy is ‘fit for purpose’ and capable in delivering the planned results. CRM enables ‘real-time ‘ review of strategy effectiveness which can lead to faster strategy amendment or abandonment if required.
CRM contribute to the strategy design process.
Understand that CRM is all about the customer so it drives customer specific strategy. What happen before CRM is all about Product and Market brought together to form generic strategy. This is the most optimal way to enable and deliver long term continuous growth.
Source: * GetBase 91% of companies with more than 11 employees use a CRM system, compared with 50% of companies employing fewer than 10 people (GetBase).