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Successful practices in customer relationship management

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Many companies have initiated projects to improve on customer orientation and plan the implementation of cus- tomer relationship management (CRM) systems. Among the desired benefits are increased customer satisfaction and retention by providing personalized products and value added services. Although the potentials of CRM are obvious only a few successful CRM implementations are known in practice. This article describes the results of a cross-industry benchmarking project in which 120 com- panies participated. The results show that there is no 'unique' CRM project and that successful implementa- tions are rarely technical projects. From the research six critical success factors for CRM projects emerged: step- wise evolution, straightforward implementation and long- term project, organizational redesign, integrated system architecture of standard components, change manage- ment, and top management support. The six successful practice companies show examples of how these critical success factors are applied.
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Successful Practices in Customer Relationship Management
Rainer Alt, Thomas Puschmann
Institute of Information Management
University of St. Gallen
St. Gallen, Switzerland
{Prename.Surname}@unisg.ch
Abstract
Many companies have initiated projects to improve on
customer orientation and plan the implementation of cus-
tomer relationship management (CRM) systems. Among
the desired benefits are increased customer satisfaction
and retention by providing personalized products and
value added services. Although the potentials of CRM are
obvious only a few successful CRM implementations are
known in practice. This article describes the results of a
cross-industry benchmarking project in which 120 com-
panies participated. The results show that there is no
‘unique’ CRM project and that successful implementa-
tions are rarely technical projects. From the research six
critical success factors for CRM projects emerged: step-
wise evolution, straightforward implementation and long-
term project, organizational redesign, integrated system
architecture of standard components, change manage-
ment, and top management support. The six successful
practice companies show examples of how these critical
success factors are applied.
1. Introduction
Building and maintaining customer relationships is
neither new nor necessary tied to the use of information
technology. Nonetheless, the use of customer relationship
management (CRM) systems is becoming increasingly
important to improve customer lifetime value [33]. By
providing information on customer data, profiles and his-
tory they support an important area of a company’s core
processes, especially in marketing, sales and service [7],
[15]. In fact, the adoption of CRM systems leads to a re-
design customer oriented processes, similar to the effect
which ERP systems have had on production-oriented
processes. In spite of the wide use of sales force automa-
tion systems in sales [20] a Forrester study [4] observes
significant deficits in today’s marketing, sales and service
processes. It was found that just 22% of the companies
surveyed possess a uniform customer view and only 37%
know which customers are looked after by the individual
business units. A customer profiling concept for customer
selection is used by just 19% of the companies surveyed
and only 20% know whether a customer has visited their
internet portal.
To eliminate weaknesses in customer contact, many
companies are either planning or in the process of imple-
menting CRM systems. According to a Gartner survey [8]
65% of US companies intended to initiate CRM projects
in 2002 (see also [21] and [1]). In Europe, roughly 3% of
companies had fully implemented a CRM project in 2001,
17% had initiated more than one local project and 35%
were developing concepts for the introduction of CRM
[27]. Another 45% have not pursued any CRM activities
to date.
As Wayland/Cole [29] point out, CRM projects have
new implementation qualities which may also be con-
nected with the high number of failed CRM projects [24].
Our research aims to establish an understanding what
businesses are doing in the area of CRM and to identify
factors which determine the success of CRM projects. For
this purpose a consortium was established which per-
formed a benchmarking project consisting of question-
naires, interviews and site visits. Section 2 describes the
research method and the six successful practice compa-
nies. Section 3 provides the results of the CRM bench-
marking project based on five benchmarks. Finally, Sec-
tion 4 derives six generic success factors and presents an
outlook into future CRM developments.
2. Research Method
2.1 Literature Review
The first requirement for the successful implementa-
tion of CRM is clarity regarding CRM terminology. From
the many approaches available, the distinction between
the following three areas has become generally accepted
[6]:
Operational CRM supports front office processes,
e.g. the staff in a call center [28],[17], [5], [9].
Analytical CRM builds on operational CRM and es-
tablishes information on customer segments, behav-
ior and value using statistical methods [18], [19].
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Collaborative CRM concentrates on customer inte-
gration using a coordinated mix of interaction chan-
nels (multi-channel management), e.g. online shops,
and call centers [12].
CRM is therefore understood as a customer-oriented
management approach where information systems pro-
vide information to support operational, analytical and
collaborative CRM processes and thus contribute to cus-
tomer profitability and retention.
Research on success factors is an area that has already
received some attention in the IS literature. Among the
examples is the general taxonomy of Wil-
liams/Ramaprasad [31] and the increasing interest in fac-
tors that determine the success of E-Commerce or Web-
presences [26]. Although CRM is often conceived as part
of E-Commerce [23], Wilson et al. [32] report success
factors which are specific to CRM projects. Using the
induction method they discovered the need for project
approval procedures, the need to leverage best practices,
the importance of prototyping new processes, and the
need to manage for the delivery of the intended benefits.
Based on the work of Wells et al. [30], Bose [2] describes
more specific critical issues that need to be addressed
during the CRM development life-cycle. Among the rec-
ommendations are to conduct a complete business analy-
sis since CRM implies changes along interaction points
with customers, to ensure long-term commitment of sen-
ior level management, to consider a stage-wise implemen-
tation of the CRM-modules, and to carefully address
‘people problems’ during the implementation process. In
a study of 96 organizations, Yu [34] reports that corporate
culture and process and technology improvement were the
“best predictors of CRM success”.
2.2 Benchmarking Procedure
To investigate the use of CRM in organizations and to
identify successful practices the criteria provided by exist-
ing research were applied in a benchmarking procedure.
This approach has proved suitable for obtaining informa-
tion on current practices and results [16]. Benchmarking
which foresees the systematic comparison of and learning
from other organizations may differ in many dimensions,
such as internal/external and qualitative/quantitative de-
sign [3]. The external and qualitative consortium bench-
marking approach adopted here comprised customer rela-
tionship executives from 12 organizations and 4 research-
ers. Due to the chosen research methodology – a mix of
questionnaire and case study approach – this research
presents a broad and in-depth picture of CRM. Four
phases were completed within the timeframe May through
September 2001 (see Figure 1):
Preparation and kick-off meeting. The research team
outlined the topic and goals of the benchmarking pro-
ject and established the consortium. Based on litera-
ture introduction project, CRM organization and
processes, system architecture, efficiency, and culture
have been selected as benchmarks and refined as cri-
teria during the kick-off meeting (see Table 1).
Benchmarks Criteria
Introduction
project
High level of implementation
Running CRM system (> 6 months)
Organization
and customer
process
Customer process thinking
Analytical CRM (customer segmentation)
Customer centred organization structures
System
architecture
Centralized customer database
Integration of CRM applications
Integration of Internet portals
Efficiency Quantification of CRM effects
Availability of measurement system
Culture CRM as corporate philosophy
Availability of change management
Table 1. Benchmarks and criteria
Screening phase. The research team identified 200
potential successful practice organizations of which
120 received questionnaires structured according to
the benchmarking criteria defined in the kick-off
meeting. Out of the 55 returned questionnaires 13
structured telephone interviews and 10 in-depth case
studies were selected.
Review meeting. At the second consortium meeting
the research team presented the questionnaire results
and the case studies on an anonymous basis. These
were then analyzed and evaluated by the consortium
members who finally selected 6 companies as suc-
cessful practices.
Company visits and final conference. The research
team and the consortium members visited the suc-
cessful practice organizations, spending one day at
each company. The results of the evaluation were
presented to the consortium at the final conference.
The design of the research project provided two data
sources for evaluation purposes: 1) the 55 questionnaires
returned, which originated primarily from European com-
panies (59%) with over 50,000 employees (48%), and 2)
the six comprehensive case studies recorded on site at the
successful practice organizations. Both sources are de-
scribed in detail in the following sections.
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• Benchmarks defined by the resear ch team based on lite rature
• Criteria ag reed and prioritiz ed by the consortium m embers
Preparation and Kick-Off Meeting
• 200 potenti al successful pract ice organizations ide ntified
• 120 questio nnaires sent out, of which 55 were retur ned
• 13 phone int erviews and 10 case st udies conducted
Screening Phase
• 10 case studi es analyzed, evalua ted and presented anonymou sly
• 6 successful prac tice organizations selecte d by consortium
Review Meeting
• Data evaluat ed and analyzed
• General conc epts and critical fa ctors derived
Company Visits and Final Conference
Database
searches
Database
searches
AC
B
E
D
1
23
4
51
2
3
54
Criteria
Bench-
marks
Fallstudie
Fallstudie
Fallstudie
Fallstudie
Fallstudie
Fallstudie
Fallstudie
Fallstudie
Fallstudie
Fallstudie
6
Fallstudie Fallstudie
Figure 1. Steps in the CRM consortium
benchmarking
2.3 Successful Practice Organizations
The successful practice organizations which were se-
lected during the review meeting consisted of the follow-
ing:
Alta Resources Corp. in Neenah (WI), USA, a ser-
vice provider in the area of call centers and customer
interaction (e.g. complaint management, lead genera-
tion). As early as 1995 Alta Resources implemented a
Vantive system for managing the customer contacts
of all clients by telephone, e-mail, letter and internet
portals.
Bertelsmann AG in Gütersloh, Germany, whose Di-
rect Group is responsible for the relationships to
approx. 20 million book club and online customers
worldwide. With its subsidiary Syskoplan the com-
pany set up a ‘Market Intelligence Organization’ in
1996 and implemented an integrated SAP system
with the modules CRM, APO, BW and PS.
Consors Discount-Broker AG in Nuremberg, Ger-
many, a financial services provider focusing on inter-
net-based securities transactions. Consors handles in-
teractions to its 450,000 customers primarily via their
call center and internet portal. In October 2000 the
company began with the introduction of an integrated
Clarify system.
Heidelberger Druckmaschinen AG in Heidelberg,
Germany, an international supplier of printing solu-
tions who aimed to improve the contact and direct
sales to their 100’000 customers worldwide. Starting
in 1996 Heidelberg designed a CRM strategy which
also includes the implementation of a centralized
Clarify system.
Swisscom AG in Zurich, Switzerland, reorganized its
customer contacts in 1998. With a Direct Marketing
Center (DMC) the company has created two corpo-
rate areas which have been supported by a Vantive
system for customer contact management since 1999.
It handles 6 million telephone calls per annum, 1.5
million incoming and 2 million outgoing letters.
Unisys (Schweiz) AG in Thalwil, Switzerland, a sub-
sidiary of the Unisys Corporation in Blue Bell, Phila-
delphia, USA, supplies IT-services to about 220 cus-
tomers. Following a reorganization of its sales struc-
ture at the end of the 1990s, the company introduced
a Siebel system which provides uniform customer
data for sales, reporting and forecasting at a global
level.
3. Benchmarking Results
3.1 Introduction Project
Almost all of the 55 companies who returned the ques-
tionnaires mentioned a similar set of motivations for the
initiation of their CRM activities. Among the examples
are improved customer selection, the targeted use of
channels for customer contact, enhanced customer value
through cross-and up-selling opportunities and increased
transparency in CRM processes. Only 11% of the compa-
nies stated efficiency as a major motivator for CRM.
The strategic nature of CRM is also reflected in the
implementation projects which typically begin with coor-
dination between the areas marketing, sales/distribution
and IT, and the definition of common goals. In 80% of the
organizations surveyed, an overall concept formed the
starting point for the introduction of CRM, which in 64%
of cases was coordinated with an E-business strategy and
the reorganization of business processes (44%). At Hei-
delberg CRM was part of a corporate eBusiness project
called e-Forum which defined transformation maps and
standards for R&D, finance and production, administra-
tion and marketing, sales and after sales. In the latter,
CRM comprised 10 customer focused projects which
were offered as pre-configured solutions to the country
organizations.
An important part of the introduction projects was the
implementation of the CRM-system. This phase was com-
pleted in an average of 7 months and included the defini-
tion of evaluation criteria, the software selection, custom-
izing, pilot and roll-out. 67% of all companies imple-
mented a pilot application before rolling out the system.
Similar evaluation criteria were used in each case: in ad-
dition to manufacturer-related criteria such as manufac-
turer’s vision, support and globality, importance was at-
tached above all to product-related characteristics such as
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functionality, product maturity, integration capability and
modularity of the solution.
In all the organizations considered, project coordina-
tion was handled centrally, while less than one third of
CRM projects were in the responsibility of the IT depart-
ment. As Figure 2 shows, marketing, sales/distribution
and management were frequently involved in the projects.
010 20 30 40 50 60
Marketing
IT
Management
Sales/Distr.
Ext. Offices
Controlling
Customers
Others
(N = 55)
Number of Companies
Figure 2. Departments involved in CRM
implementation projects
3.2 CRM Organization and Processes
The benchmarking showed that CRM involves signifi-
cant changes regarding the organization of marketing,
sales and service activities. Most companies reorganized
internal processes and implemented them on a cross-
functional and cross-organizational basis (see Figure 2).
Remarkably, only 30% involved the customers them-
selves in the design process. More information in redesign
efforts were provided by the six successful practice com-
panies:
Customer life cycle models. Customer relationships
are divided in various phases and individual services
are offered to the customer in each phase. For exam-
ple, customers in the service phase at Heidelberg may
obtain information and spare parts through their
online shop. Companies such as Consors and Swiss-
com link analytical CRM processes to the operational
activities. The life cycle is used to predict customer
behavior, e.g. when a customer can be addressed via
a campaign, when he or she is likely to cancel a rela-
tionship etc. Customers are assigned based on past
purchases, volumes, and socio-demographic or geo-
graphical data.
Customer segmentation. Responsibility for customers
has been redesigned on the basis of customer and/or
market segments. For example, a board member at
Consors has responsibility for large volume custom-
ers (‘heavy traders’) across the company’s entire
product portfolio. Unisys (Switzerland), is now or-
ganized according to ‘Financial Industries’ and
Swisscom according to ‘Fixnet’ and ‘Mobile’ cus-
tomers.
Centralized organization units. Responsibility for
CRM activities is usually organized in new organiza-
tional units which act as internal service providers.
Heidelberg covers local markets with 85 Sales and
Service Units (SSU) who provide the business areas
with marketing tools, know-how and experience. A
new department ‘Marketing Intelligence & CRM’
(MI-M) coordinates marketing activities and utilizes
synergies on a corporate basis. Bertelsmann, Swiss-
com, and Consors have also established corporate
centers which offer specialist skills and know-how in
the area of analytical CRM (e.g. churn analyses, data
mining).
Link to forecasting. Information from operational
CRM processes is used in predicting sales volumes
and supply chain planning. Unisys implemented a
fortnightly evaluation of opportunities which led to a
maximum sales forecasting variance of +/- 2%.
Bertelsmann uses the planned campaign successes for
requirements planning in the supply chain to their
book stores, e.g. a campaign success of 15% leads to
an equivalent increase in the demand of books.
Centralization of CRM responsibility proved important
for achieving the necessary standardization of CRM ac-
tivities. Unisys (Switzerland) had already adapted a global
standardized sales process which ensured a uniform un-
derstanding of the terms ‘lead’, ‘opportunity’, ‘quotation’,
etc. Standardized interfaces between complaints and ser-
vice management enabled the integration of two formerly
separate processes. Heidelberg’s service engineers, for
example, now know when a production manager is plan-
ning to buy a new machine.
20 10 0 10 20 30 40
Number of Companies
1 Customers were involved in the
process design
2 Internal customer processes were
re-engineered
3 Processes were implemented on a
cross-functionaland cross-organizational basis
(N = 55)
30
Strongly
disagree
Disagree Agree Strongly
agree
Figure 2. Process design at the benchmarked
companies
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3.3 System Architecture
CRM systems usually replace isolated solutions which
support specific activities in marketing, sales, and service.
A centralized database provides a uniform view of cus-
tomers and support for standardized processes. Although
58% of all companies said they had a CRM system in
operation, less than half of them used it on a cross-
organizational basis. As Figure 3 shows, almost all com-
panies pursue a best-of-breed approach, i.e. specialized
systems from Siebel, Vantive, Update or Clarify comple-
ment existing ERP systems. Four companies, including
Bertelsmann, use SAP CRM linked with other SAP com-
ponents. Although similar in their basic functionalities,
the system decisions reflect each vendors strengths: sales
force support at Siebel, service and call center support at
Vantive and Clarify, and integrated processes at SAP.
Most companies customized the selected systems to suit
their individual requirements. At Heidelberg the MI-M
department defined three reference models for a global
standard functionality together with the local SSUs and
customized roughly 20% at local level. This ratio was also
observed at the other successful practice organizations
(20-30%).
02468101214
Other
Own devt.
Vantive
Clarify
SAP
Update.com
Siebel
Number of Compan ies (N=55)
Results from Questionnaires Successful Pract ices
Unisys
Bertelsmann
Consors, Heidelberg
Alta Resources, Swi sscom
Figure 3: CRM systems used by benchmarking
participants
Many companies had a centralized system architecture.
Globally operating companies, such as Bertelsmann, Hei-
delberg, and Unisys, had local systems with periodically
replicating customer databases. These architectures also
provided integration across different CRM dimensions:
Operational CRM. Operational integration points
exist to human resource systems for user data and
ERP systems for transferring order information
which was captured e.g. from a call center represen-
tative. Integration to supply chain systems is illus-
trated by Bertelsmann: Campaign data from SAP
CRM is sent to SAP SD for the calculation of sales
plan data, and then routed to SAP MRP for require-
ments and procurement planning. ‘Anomalies’, i.e.
products where inventories remain significantly
above or below demand, are shown in the SAP APO
Alert Monitor.
Analytical CRM. For management and evaluation
purposes, the operational customer data are integrated
with a centralized data warehouse which consolidated
data based on certain criteria (e.g. sales, profits) in a
uniform data model. Consors, for example, has stored
all 30 million transactions performed to date. A cus-
tomer’s transactions can be analyzed over time, e.g.
all customers who opened a securities account in
1997/98 and since then have only carried out 1-5
transactions. The data mining tool analyzes defined
dimensions, e.g. compares the characteristics of one
building loan customer with another, leading to the
determination of a customer segment with an ‘affin-
ity’ for building loans and thus providing the basis
for a targeted marketing campaign.
Collaborative CRM. Approximately 60% of the com-
panies surveyed use internet portals in their customer
communication (see Figure 4) for selected or suitable
activities. Heidelberg, for example, offers the sale of
some consumer goods (e.g. printing cartridges) and
service management. At Alta Resources a green light
in the Vantive system alerts the call center represen-
tative that personal data has been entered in a cus-
tomer’s portal and that the customer requires further
information on a specific product. Consors also has a
distinctive collaborative CRM system which handles
customer transactions both through the call center
and via the portal. The latter also features comple-
mentary services such as insurance.
-30-20-10 0 1020304050
Number of Companies
Strongly
disagree
Disagree Agreee Strongly
agree
CRM is optimally integrated into the existing
system landscape
We use internet portals f or customer interaction
The view of customer data is uniform
We use mobile devices in our personal contacts
with customers
We use a cross-organizational CRM system
We have a customer profiling co ncept for acquiring,
recordingand utilizing customer data
(N=55)
Figure 4. Questionnaire results on system
architecture
3.4 Operational Efficiency
Implementing a CRM system is not mainly driven by
the possible savings. 55% of the benchmarked companies
agreed that strategic or qualitative goals have been the
main drivers for introducing CRM. Among the effects are
improved process and data transparency, better customer
retention, higher consultancy quality, more targeted cus-
tomer communication or proactive customer management.
Only 38% have proved the operational efficiency com-
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pared to 50% which reported difficulty in measuring
CRM effects. Figure 5 summarizes the most frequently
used benefit arguments.
Among the successful practices, Swisscom performed
an operational efficiency analysis composed of direct ef-
fects (savings relating to operational processes in direct
marketing and data maintenance), indirect effects (fewer
misses, greater productivity in sales), increased sales vol-
ume and additional business which led to a ROI of 2.9
years for the CRM project. At Consors, qualitative goals
such as improved customer service were the clear priority,
but have been supported by a thorough control of time-
frame and budget, as well as by process savings of 30%
and increased revenues of 40%. Both figures were de-
tailed, e.g. process savings with reduced postage costs due
to more focused mailings (from 500,000 to 1,000 letters
per mass mailing).
Heidelberg calculated a positive net present value
which also included the corporate standardization of
CRM systems (cost-effective rollout, release change,
etc.). Bertelsmann expects improved customer care for
their 20 million club customers and is trying to increase
the success rate of campaigns through more targeted cus-
tomer communication. Purely qualitative arguments were
mentioned at Unisys, e.g. the strategic necessity of sys-
tematic opportunity management with key accounts.
0 1020304050
Increased profits thanks to CRM
Reduction in the number of complaints
Increase in customer satisfaction
Exploitation of customer potential
Higher efficiency in sales operations
Reduction in throughput time
Number of Companies
None Low Average High
(N=55)
Figure 5. Potentials of CRM projects
3.5 Culture
Involving as many potential system users as possible is
vital to the adoption of CRM within an organization. This
not only refers to establish the necessary skills for operat-
ing the system but also to convince staff that the system
will be beneficial. In all benchmarked companies man-
agement played an active role in the decision-making
process and the implementation of CRM (see Figure 6).
Other departments involved included marketing, customer
contact centers, finance and/or accounting, sales and tech-
nical service, and seldom logistics and production.
Although most CRM projects were within time and
budget, the effort to obtain adoption varied. In call center
implementations (Swisscom, Consors, Alta Resources,
Bertelsmann) employee acceptance largely existed. At
Bertelsmann, the call center staff were involved in the
CRM design and were able to relate to the goals of CRM
(better call center support, no loss of jobs) from the out-
set. Heidelberg and Unisys used a similar strategy to con-
vince field sales force who consider their knowledge of
customers and markets to be personal advantages and
therefore find it difficult to share it throughout the com-
pany. Heidelberg’s goal was to shape an understanding
that CRM is about ‘a transparent customer, not about
transparent salesmen’. At Unisys all staff were trained
and obliged to use the system. Despite organizational
rules (no budget without system entry) motivated users,
some users had to be ‘motivated’ with pressure and some
non-users were observed after two years. Unisys and Hei-
delberg estimate a minimum of two years for filling the
database with the customer data. Use of the systems by
management was considered as a motivating boundary
condition.
0 5 10 15 20 25 30 35
Management
Countries (decentral)
Marketing
IT
Others
Number of Companies (N=55)
Figure 6. Organizational units responsible
for CRM
4. Success Factors and Outlook
4.1 Success Factors in CRM
The benchmarking consortium detailed and prioritized
measurements for each benchmark identified in the kick-
off meeting (see Table 1) and guided the entire selection
of successful practices. Our analysis led to the formula-
tion of six success factors (see Table 2). They support
existing findings regarding non-technical factors in IT
adoption (e.g. [2], [14], [15], [22], [32], [34]). Although
the implementation of a CRM system often marks the
start of a company’s reorganization in marketing, sales
and service, the success is mainly determined on organ-
izational and cultural turf:
Evolution path. As a first step, most companies im-
plemented a system for operational CRM, e.g. call
center or sales force processes. This corresponds to
existing research which considers a centralized data-
base providing consistent and up-to-date information
as a prerequisite for CRM [15]. Analytical CRM rests
upon this foundation and covers data mining and
churn analysis functionality. Only little use was made
of collaborative CRM which indicates an evolution
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path from operational, analytical to collaborative
CRM and a stepwise implementation of CRM.
Timeframe. Most successful practice organizations
have gone through a rapid system evaluation phase
and completed the system introduction phase within
approximately 7 months. However, filling the data-
base with meaningful information and achieving
adoption in the areas of marketing, sales, and service
was considered to take a minimum of 2 years. This
supports the average timeframe of four years reported
by [34]. Successful companies split these long-term
CRM projects into manageable subprojects lasting a
maximum of 6 months.
Organizational redesign. Prior to the introduction of
a CRM system all successful practices established
CRM concepts for the definition of processes and or-
ganizational structures. The former includes the iden-
tification of interaction points along customer life cy-
cles which are also established in literature (e.g. [11])
and the definition of uniform customer data and pro-
cedures across various interaction channels. This re-
fers to the business analysis mentioned by Bose [2].
However, organizational redesign also needs to con-
sider structural issues, i.e. to establish a centralized
responsibility and authority for defining cross-
functional standards. Contrary to centralized organi-
zations, highly decentralized organizations leave the
implementation lead to country organizations and
prevent conflicts with the existing culture.
System architecture. Virtually all the CRM systems
in the benchmarking were standard packages, while
no system offered a comprehensive operational, ana-
lytical and collaborative CRM functionality. Ad-
vanced CRM companies integrated specialized sys-
tems for operational, analytical, and collaborative
CRM into a best-of-breed architecture. Following the
evolution path described above, mature CRM con-
cepts also required an integration architecture for
seamlessly exchanging information. A restrictive atti-
tude was observed concerning the change requests
collected among CRM users. All successful practice
representatives agreed that customization of standard
packages was disproportionate to the achieved bene-
fits.
Change management. Convincing employees of the
benefits of CRM methods and systems is regarded as
an important success factor reported in literature [2].
The benchmarking presents a more specific picture,
since convincing call center staff proved to be not as
difficult as to obtain the buy in within the sales force.
Among the instruments observed were early in-
volvement in the introduction project and the creation
ment in the introduction project and the creation of
incentives to use the system on a daily basis.
Top management support. For establishing customer
orientation on a corporate level (board members with
customer responsibility), implementing inter-
organizational process and system standards, and for
supporting the adoption of the CRM systems within
the organization (penalizing non-use, setting an ex-
ample) top management support was a key require-
ment. Top management sponsors also ensure that
short-term setbacks in the CRM project can be over-
come. This is especially important since unlike other
IT projects (e.g. eProcurement projects), the introduc-
tion of CRM projects is not motivated by quantitative
efficiencies but legitimized out of strategic motiva-
tions (e.g. strategic necessity, customer retention).
Although this supports existing findings [13], the
benchmarking emphasizes the importance of measur-
ing whether time and budget goals have been met as
well as to balance CRM investments with direct and
indirect benefits.
Benchmarks Criteria Critical success factors
Introduction
project
High level of imple-
mentation
Running CRM sys-
tem (> 6 months)
Start with operational CRM and
enhance with analytical and
collaborative CRM
Rapid evaluation of CRM in-
formation systems
Medium-term projects which
need to be broken down in
manageable sub-projects
Organization
and customer
process
Customer process
thinking
Analytical CRM
(customer segmenta-
tion)
Customer centred
organization struc-
tures
Redesign of customer interac-
tion points and orientation on
customer process activities
Centralized organization unit
for standardization
Involvement of top manage-
ment
System archi-
tecture
Centralized customer
database
Integration of CRM
applications
Integration of Internet
portals
Select CRM system depending
on CRM focus
Use standard CRM software
with minimal customization
Integrate systems for analytical
and collaborative CRM with
operational CRM system
Efficiency Quantification of
CRM effects
Availability of meas-
urement system
Management of projects ‘in
time’ and ‘in budget’
Measurement of small quantifi-
able benefits
Culture CRM as corporate
philosophy
Availability of
change management
Involve users in early stage and
communicate CRM goals
CRM should not conflict with
established organization culture
Ensure use of CRM on man-
agement level
Table 2. Summary of benchmarks, criteria and
success factors
Proceedings of the 37th Hawaii International Conference on System Sciences - 2004
0-7695-2056-1/04 $17.00 (C) 2004 IEEE 7
4.2 Outlook
None of the benchmarked companies had a fully im-
plemented CRM concept. Although the initial modules
existed in the form of a customer database, data ware-
house and portals, CRM continues to be of strategic im-
portance and is being leveraged by technological poten-
tials. The stated areas include:
Communities give rise to horizontal communication
between customers, businesses and suppliers. With
online chat rooms, online seminars or FAQ forums
[10] additional possibilities were mentioned for sup-
porting the customer process and promoting customer
retention.
Following the Bertelsmann example, several compa-
nies are planning to integrate CRM and supply chain
systems. Standard software vendors such as SAP are
already positioning their CRM systems as a leading
system for customer interaction and envisage various
integration scenarios with other modules. The inter-
faces are provided by data warehouse and middle-
ware systems.
Mobile technologies create additional possibilities for
customer contact [25]. While field sales staff already
work with mobile terminals, companies are investi-
gating which services can be offered to customers via
smart devices (e.g. patient monitoring, off-board
navigation).
With predictive customer care companies try to iden-
tify customer requirements and behavior in advance.
They expand their analytical CRM tools and try to
analyze customers not only statically at a particular
point in time but also cyclically over the complete
life cycle.
Strategies to intensify the integration of business
partners (collaboration). This can mean opening up
internal systems to customers on the one hand and in-
tegrating the services of external providers on the
other. Consors, for example, is opening up its internal
transaction system for customers.
The aim of this exploratory study was to describe the
use of CRM and to identify success factors for CRM pro-
jects. It shows that CRM is still at an early stage regarding
the adoption in practice as well as regarding the under-
standing of success factors on a detailed level. Further
research is needed to derive empirically testable hypothe-
ses as suggested by Romano [23] and to embed the suc-
cess factors in a methodology which guides companies in
successful CRM implementations.
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