After two years, the majority of companies implementing CRM systems saw benefits across key areas like faster transactions, improved financial management, and better decision making. However, simply installing software was not enough - companies had to make CRM a core part of their operations to achieve substantial value. Additionally, good customer service was the top factor in customer loyalty, while poor call center experiences would cause over half of customers to stop doing business with a company. Finally, personalizing websites did not effectively increase sales and often deterred customers due to privacy concerns.

1. IOMA’S REPORT ON CUSTOMER RELATIONSHIP MANAGEMENT DECEMBER 2003
ICRM news briefs
l All things come to those who wait—including results from a CRM implementation! That, in a
nutshell, is the remarkable conclusion of an Accenture (Bermuda; www.accenture.com) Institute for
Strategic Change study of 163 businesses in North America, Europe, and Australia, as reported in the CIO
Magazine (www.cio.com) article, “Enterprise Systems Show Results,” by Lorraine Cosgrove Ware. Key
finding: After two years, the majority of respondents implementing enterprise (ERP and CRM) systems
saw payback in just about every area of hoped-for result. Sample results:
Benefits Achieved From CRM or ERP
Percentage of Respondents Seeing Results in:
One to
Benefit One Year Two Years Four Years
Faster information transactions 78% 89% 94%
Improved financial management 70 90 97
Better managerial decisionmaking 58 80 90
Cycle time reduction 57 78 88
Improved inventory and asset management 50 70 82
Ease of expansion/growth and increased flexibility 48 68 79
Improved customer service and retention 46 68 79
Headcount reduction 5 55 70
Increased revenue 29 49 62
Of course, the companies enjoying these benefits didn’t just install software and sit back. As
Accenture consultant Tom Davenport put it, “We now have evidence that getting value from enterprise
systems (ES) is not a project, but a way of life.” In other words: If the ES project ends when the software
goes live, “it’s unlikely that substantial value will be achieved.” For more pointers on patiently reaping
CRM rewards, see the CIO article.
l What makes customers loyal to a company? Good service. At least that’s the answer given by 56%
of the 2,367 consumers surveyed by Genesys (Daly City, Calif.; www.genesyslab.com) for its Global
Consumer Survey: Examining the Impact of Customer Service. The firm polled consumers across the
world about their views on customer service and call centers, and the results are well worth your while
to download from the Genesys site. Other factors that affected loyalty:
Good product 28%
Good price 7
Other 6
Trusted brand name 3
More findings of note: 76% of respondents would buy from a company based on a good call center
experience, while 85% would stop doing business based on a poor one—in fact, 56% of the people
surveyed reported having stopped doing business with a company because of a poor call center
experience.
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2. IOMA’S REPORT ON CUSTOMER RELATIONSHIP MANAGEMENT DECEMBER 2003
l Web personalization doesn’t appear to pay, warns the Jupiter Research report, Beyond the
Personalization Myth, according to the CNET News.com (news.com.com/2100-1038-5090716.html)
article, “Report Slams Web Personalization,” by Paul Festa. “Companies trying to get personal with their
Web site visitors in hopes of increasing sales are wasting more money than they’re earning,” observes
Festa. For one thing, it costs about four times as much to “personalize” a site than to run a “comparable
dynamic site.” Worse yet, Jupiter’s study found that personalizing a site “was more than twice as likely
to result in finding visitors who would never pay for anything as it was to attract paying customers.” Why?
For one reason, about 25% of customers surveyed resist Web site customization attempts for fear of
misuse of their personal information by marketers. What to do? Make your site easier to use, concludes
Jupiter. “Given flexible, usable navigation and search, Web site visitors will be more satisfied with their
experiences and will find fewer barriers to the profitable behavior sought by site operators,” Jupiter
concludes. “In fact, good navigation can replace personalization in most cases.”
l The State of CRM Software 2003-2004: “Buyer’s Guide” Ratings of CRM Software; Key Trends;
Core Issues, by Dick Lee and David Mangen, Ph.D. The guide includes: more than 1,000 customer
assessments of CRM software; customer satisfaction ratings of the top 14 systems; customer ratings of
system effectiveness supporting marketing analysis, marketing campaign management, sales force
automation, call center sales and service, field service, e-service, and more; customer feedback on CRM
consultants and analysts, and research-based reporting of CRM industry trends and issues—all in a mere
124 pages. While ICRM has had no opportunity as yet to review this “kitchen sink” of a CRM software
guide, we have found other publications on CRM by Lee refreshingly frank and helpful. To order: Go to
the CRMGuru.com store (www.crmguru.com/store/hym002.html). Cost: $195.
l Customer service and CRM not on the chopping block—yet. “Companies may have been hit hard
by the lingering recession, but customer-facing applications and customer service haven’t lost their
luster,” concludes InformationWeek’s (www.informationweek.com) Helen D’Antoni (hdantoni@cmp.
com) in her article, “Changes Afoot For Customer Service.” In 2002, the U.S. “was the dominant market
for [CRM] tools and products, accounting for $7.1 billion, or approximately half of worldwide sales.” She
adds that the Aberdeen Group (Boston; www.aberdeen.com) expects this market share to “hold steady
into 2006.” Information Week Research’s own “Evolving IT Priorities” series backs this up, finding that
90% of managers surveyed say “improving customer service is a primary concern.” In fact, D’Antoni
reports that the research showed that “customer-service initiatives were immune even to the cost-cutting
and budget-crunching efforts that were so prevalent a year ago, when many companies faced more dire
circumstances. Of the 300 sites surveyed last year about fourth-quarter objectives, 91% were committed
to improving their customer service.”
l Good news on the credibility front? Maybe, considering a study by LRN (www.lrn.com), a provider
of legal, compliance, and business ethics management and education services. Key finding: Based on
responses from 1,001 Americans, the study found “corporations still may lack general credibility among
the rank and file, [but] the majority of employees have strong trust in their supervisors.” Specifically, when
asked, “How much trust do you have in your boss?” respondents answered: “a lot” (63%); “some” (17%);
“very little” (8%); “none” (4%); “don’t have a boss” (8%).
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