I often think back to my days in banking, especially when the topic of strategic planning comes up. Every time they felt they needed to become more efficient, they would hire a team of consultants. I would never suggest that approach for a middle market company.
Back when I worked in banking, I was with one of the largest bank holding companies around. I participated in a number of strategic processes like due diligence review of potential acquisitions. Between the attempts at stealth, the compressed time frames, the lack of sleep and the poor coordination, the outcome was a crap shoot. Maybe the scarier thing was the money they wasted on internal strategic improvements. I was a part of one such effort, managed by external consultants, where the stated goal was to improve the efficiency ratio. A year after I left, the ratio was the same or worse.
My primary responsibilities were projects designed to integrate a myriad of credit cultures gained from acquisition activity. However, our leaders were more interested in quick fixes that affected short term stock prices. So, the would willing spend millions on consulting that addressed important trimming around the edge issues like free coffee and requiring each manager to cut x percent of their staff. This was in response to the losses of the last real estate crisis (yes, it's happened before). Essentially, the focus was on everything but the real problem.
So, my experience with a strategic planning process leads me to see shallow opportunities to cut costs, when the real problems are deeper and elsewhere. I respect consultants that work in this field. Especially the creative ones. The problem is that too often, the pressure on everyone is short term in nature, like the stock price. Tell me, what is strategic about short term improvements?
The strategic planning process for CRM is about creating better long term relationships with your customers. Developing a CRM strategy is critical form CRM success. So don't let the fact that the typical strategic planning process is ripe with failure deter you from developing the plan you need for a successful CRM initiative. Follow some simple steps and you will have great success.
Develop Your CRM Plan - If you don't have a plan, you have no way to guide your company towards customer centricity. This plan will also determine what technology you will need to support it.
Perform a CRM Analysis - You need to start by understanding where your company is today. To do this you need to throw out the baggage and be realistic or you won't be doing your company and favors.
Understand the Benefits - You will learn new things about your customers in this process and you need to understand how it's application will change your business and the loyalty of your customers.
Why Quantify the Benefits? - Because you can't spend millions to get a small payback. You need to set priorities for your investment and quantifying the economic benefit will help you justify the money and time you're about to spend.
The Costs of CRM - You know the financial benefits, now you need to pair that up with the costs. Your CFO is more likely to approve a project that has a clear return on investment.
Risk Must Be Managed - CRM is an investment. Investments imply risk and reward. To get the reward you have to mitigate the risk by identifying it and managing the outcome. It will be difficult to justify a project if you haven't addressed the downside.
CRM Implementation - The last thing you must address is how you plan to implement your CRM strategy. I'm not just talking about implementing the software! Their is a human process that factors into a successful CRM initiative as well. Actually, it's bigger than the software in my opinion.
CRM Metrics - A high level view of CRM metrics that will help you better understand success or failure and also areas for opportunity going forward
Back when I worked in banking, I was with one of the largest bank holding companies around. I participated in a number of strategic processes like due diligence review of potential acquisitions. Between the attempts at stealth, the compressed time frames, the lack of sleep and the poor coordination, the outcome was a crap shoot. Maybe the scarier thing was the money they wasted on internal strategic improvements. I was a part of one such effort, managed by external consultants, where the stated goal was to improve the efficiency ratio. A year after I left, the ratio was the same or worse.
My primary responsibilities were projects designed to integrate a myriad of credit cultures gained from acquisition activity. However, our leaders were more interested in quick fixes that affected short term stock prices. So, the would willing spend millions on consulting that addressed important trimming around the edge issues like free coffee and requiring each manager to cut x percent of their staff. This was in response to the losses of the last real estate crisis (yes, it's happened before). Essentially, the focus was on everything but the real problem.
So, my experience with a strategic planning process leads me to see shallow opportunities to cut costs, when the real problems are deeper and elsewhere. I respect consultants that work in this field. Especially the creative ones. The problem is that too often, the pressure on everyone is short term in nature, like the stock price. Tell me, what is strategic about short term improvements?
The strategic planning process for CRM is about creating better long term relationships with your customers. Developing a CRM strategy is critical form CRM success. So don't let the fact that the typical strategic planning process is ripe with failure deter you from developing the plan you need for a successful CRM initiative. Follow some simple steps and you will have great success.
Develop Your CRM Plan - If you don't have a plan, you have no way to guide your company towards customer centricity. This plan will also determine what technology you will need to support it.
Perform a CRM Analysis - You need to start by understanding where your company is today. To do this you need to throw out the baggage and be realistic or you won't be doing your company and favors.
Understand the Benefits - You will learn new things about your customers in this process and you need to understand how it's application will change your business and the loyalty of your customers.
Why Quantify the Benefits? - Because you can't spend millions to get a small payback. You need to set priorities for your investment and quantifying the economic benefit will help you justify the money and time you're about to spend.
The Costs of CRM - You know the financial benefits, now you need to pair that up with the costs. Your CFO is more likely to approve a project that has a clear return on investment.
Risk Must Be Managed - CRM is an investment. Investments imply risk and reward. To get the reward you have to mitigate the risk by identifying it and managing the outcome. It will be difficult to justify a project if you haven't addressed the downside.
CRM Implementation - The last thing you must address is how you plan to implement your CRM strategy. I'm not just talking about implementing the software! Their is a human process that factors into a successful CRM initiative as well. Actually, it's bigger than the software in my opinion.
CRM Metrics - A high level view of CRM metrics that will help you better understand success or failure and also areas for opportunity going forward
About the Author:
Mike Boysen is an experienced CRM consulting and creator of Effective CRM Consulting. You can learn more about the strategic planning process at his website/blog
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