Customer Relationship Portals – Managing Customers in an E-Business World
Market dynamics have dictated the need to elevate CRM to a strategic corporate level. It is clear that consistent, unified customer interaction across all communication channels, all applications, and all business functions is a requisite to satisfying and retaining customers. But the integration of communication channels looms as an important ingredient to achieving this type of success – and a CRM portal may be a key driver.
Preface
The e-business revolution is causing turmoil on many fronts. Web initiatives are creating greater reach, leading to dramatic surges in customer service requests. The Web is removing geographical barriers and making it easier for customers to compare competitive offerings, leading to decreased customer loyalty and, therefore, an imperative to improve service and support.
At the same time, companies are creating disparate silos of customer information for different customer touchpoints, leading to the phenomenon of "corporate amnesia" where a customer is not consistently served, or even recognized, across multiple channels.
In the world prior to e-business, the telephony-based call center was sufficient to the needs of companies' service and support requirements. Then, as new communications channels emerged, the call center evolved into a media-blended contact center. However, simple multi-channel connectivity is not adequate to the new demands of an e-business world. These market dynamics have created a pressing need to elevate CRM to a strategic corporate level. More specifically, this situation entails consistent, unified customer interactions across:
- All communications channels: Web, phone, fax, e-mail, and video
- All applications: front- and back-office
- All business functions: sales, marketing, and customer service.
This need for a strategic approach to CRM is by now clear to all, and it is much discussed. Much less discussed is how this has to be done, given the myriad ways that businesses already interact with their customers, as well as companies' extensive legacy investments in customer business and communications systems. Customers are using new communications channels; now it's time to do the hard work of integrating them. Which approach makes the most sense, given the significant existing infrastructure and high volatility being experienced by most markets? In this white paper, Aberdeen examines the drivers and realities of these issues; discusses the needs that a solution must address; and briefly describes a promising approach that Aspect Communications recently unveiled.
CRM Evolves from Front-Office Applications to Corporate Strategy
"Customer Relationship Management" has recently become a ubiquitous, yet ambiguous, phrase. What does it really mean? The early names associated with the CRM concept were usually application providers such as Siebel, Vantive, and Clarify, most of which began as providers of specific sales force automation (SFA) or support applications and then broadened their offerings to encompass a broader swathe of the front office. More recently, a variety of other software and service suppliers from systems integrators to Internet application providers to computer-telephony integration suppliers and decision support suppliers (DSS) have also laid claim to the CRM moniker.
But these individual applications are really only a subset of what CRM is now as a whole: not so much a specific application or service, as a corporate-level strategy that encompasses all business functions, both front-office and otherwise, that involve the corporation's interaction with its customers. This elevation of CRM to a corporate-level strategy entails much more than strength at single customer touchpoints. Rather, it requires interconnected solutions that span both the company and the various modes of customer communication, enabling consistent customer service over all customer communications channels.
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The New Market Dynamics of E-Business
There are several market developments driving the need for consistent customer interactions across all channels. These developments are being driven by the catalytic and disruptive effect that e-commerce is having on all industries.
The Service Multiplier Effect
In the earliest days of e-business, many companies launched massive online initiatives under the false assumption that customer service requirements would actually decrease as customers employed Web-based self-service applications. But most of these companies have found that the opposite is true namely that the Web creates a multiplier effect that actually increases overall service demands. This multiplier effect has two aspects. First, a significant Web presence creates greater audience reach, resulting in a larger customer or prospect base that is generating service requests over all communication mediums. Second, these customers become more active due to geographic availability and 24x7 Web access. As activity increases, so too do service requirements. The overall result is an imminent need for more robust service capabilities that span multiple communications channels. As companies pour additional resources into expanded e-business initiatives, and companies learn from early mistakes, this need will only become more pronounced.
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As a corollary to the experience of brick-and-mortars, dot.coms are experiencing their own service challenges. Many of the early pure-play Web leaders initially poured their resources into marketing initiatives, sales (e.g., transaction processing), and fulfillment. What they ignored in their rush to gain market share was the need this would precipitate for multi-channel service and support capabilities. Now, even the most successful dot.coms must act quickly to integrate these capabilities in order to keep the customers they have fought so hard to acquire and to slow the onslaught of traditional brick-and-mortar companies into the e-business space.
This imperative goes beyond less tangible issues such as customer satisfaction and loyalty to encompass quantifiable revenue generation. Indeed, numerous studies have found that a considerable percentage of potential Web sales are abandoned in mid-course due to the fact that many pure-play e-commerce sites have little, if any, service and support capabilities to overcome purchase hurdles.
Customer Information Silos: The Lack of Integration
While rushing to participate in the e-business gold rush, many brick-and-mortar companies have treated the Web as a completely separate, disconnected entity rather than an interrelated medium that must be fully integrated with existing communications channels. Not only are Web applications not integrated with front and back office applications, but they are also disconnected from legacy call center infrastructure. This departmentalized approach has led to the creation of disparate customer contact silos, one for traditional channels such as call centers, and the other for the new Web medium. This approach leads to a "corporate amnesia" effect i.e., the company's inability to remember and consistently track a customer's needs or activities from application to application or medium to medium.
For example, under this silo approach, a customer entering a service request via the Web site or e-mail is often unable to trace the status of that request by contacting a customer service representative (CSR) in a traditional call center environment. Anyone who has dealt with current Web-based service requests knows that this scenario, far from being unusual, is in fact the norm.
The Fickle E-Customer: Increased Need for Consistency and Personalization
Why does Disney charge more for admission at the gate than it does through travel agents? Because, once at the gate, the prospect is locked in and cannot compare prices and features against competitive offerings. In the Web environment, competitors, as well as price and feature comparisons, are never more than a mouse-click away. To counteract customers' lower switching costs and increased information availability, companies functioning in the e-commerce world must offer strong personalization and consistency of service across communications channels. These two attributes of next-generation CRM personalization and consistency are therefore quickly evolving from "nice-to-have" capabilities to mission-critical core competencies.
To date, many personalization efforts have relied on incomplete customer data, often from a single communication channel such as the Web. For example, many early "personalized" Web marketing initiatives were built solely upon data gathered from that customer's Web interactions, completely disregarding interactions through other media such as the call center. This is ineffective in that it only leverages a small segment of the information a company has on its customers. In the near future, companies that are able to personalize efforts based on all of a customer's interactions, regardless of channel, will be at a considerable competitive advantage over those companies that are only sporadically drawing from disparate silos of customer information as the basis for their personalization efforts.
How to Solve the Dilemma: The Crucial Elements
To solve these problems, several elements, all working together, are needed. Front and back office applications from companies such as Siebel, Clarify, SAP, and Oracle will need to be sufficiently integrated both among them and with the customer contact center. In addition to these primary business applications, a further set of systems and applications are needed to elevate CRM to the strategic level. These systems and applications comprise integrated business rules and workflow, the extension of
ACD functionality to e-mail, Web page responses, packet telephony, and integrated decision support.
A CRM Nerve Center: Business Rules and Workflow
To meet the needs of an e-commerce world, the traditional framework for CRM the call center for handling customer calls over the public switched telephone network (PSTN) is no longer sufficient in and of itself. What is needed is an overarching customer relationship nerve center, which continually manages and applies the rules that a company defines for applying resources to customer interactions. This amounts to a business rules and workflow engine that spans a company's entire CRM operation, including communications channels, applications, and business functions. Further, in order to adapt to the quickly changing requirements of an e-commerce customer environment, the business rules engine must be easily modifiable by the personnel closest to the various processes. Simply put, this capability requires software tools that simplify the process of adjusting business rules in a rapid and effective manner.
Extended ACD Functionality
The ability to route all customer communications to the appropriate people, using the business rules applied by the CRM nerve center, is essential to a strategic CRM implementation. Advanced Automatic Call Distribution (ACD) functionality must now be extended beyond PSTN phone and fax to e-mail, Web page, and packet telephony communications. By extending the ACD paradigm to include new communications channels, all customer communications can be "queued" for call center representatives or anyone else in the organization, as business rules dictate, just as with the legacy ACD system.
Workflow-Enabled CTI Functionality
The advanced CTI functionality that is part of state-of-the-art enterprise call centers today is more necessary than ever for superior customer service. This functionality, working according to the business and workflow rules already mentioned, provides data access and delivery (including initial Integrated Voice Response [IVR] data) to enable screen and application "pops," which access front and back office applications before and during the live customer interaction, thereby improving the customer experience and making customer service representatives more efficient. In short, CTI (Computer Telephony Integration) functionality, like ACD functionality, must now be extended to other customer communications channels.
Integrated Decision Support
In an e-commerce world, a strategic CRM system needs to have a powerful memory of an organization's interactions with its customers, and the ability to analyze the data preserved in that memory. This is the rationale for integrating a dedicated decision support system, including a centralized data repository, with the CRM systems that conduct customer interactions. Organizations need to be able to perform sophisticated analysis and reporting on the activity of multiple customer interaction centers. Further, they need to use query and reporting tools to improve CRM business rules and to better forecast ongoing workforce and communications system requirements and costs.
Aspect's Credentials
Aspect is one of the first suppliers to bring all these elements together in one integrated package. The company has a significant background in the call center environment, with 14 years of experience and more than 3,500 global implementations as an ACD supplier. The company is also an experienced supplier of CTI, desktop reporting, fax and e-mail integration, and enterprise data access. Finally, Aspect's extensive call center consulting practice has been the proving ground for the Aspect Customer Relationship Portal.
Aberdeen Conclusions
In the emerging e-business-driven world, organizations must move aggressively to create something like a customer relationship portal in Aspect's sense. The Aspect Customer Relationship Portal ties together all of the necessary components a central CRM "nerve center," generalized ACD functionality, CTI capabilities, and integrated decision support required to elevate a corporation's CRM initiative from the specific application level to the corporate strategic level. The integrated combination of these elements is well conceived, and should be highly attractive to user organizations. The Customer Relationship Portal, as Aspect has defined it, is a thoughtful response to the emerging realities of an e-business world.
About the Authors
Donovan Gow, Research Analyst — Customer Relationship Management, covers the CRM market, with an emphasis on sales and marketing automation. Donovan also covers emerging e-marketing applications such as e-business intelligence tools, personalization and recommendation applications, as well as push technologies. He provides analysis and consultation for established market leaders as well as for younger companies seeking to position themselves, gain market awareness, and/or establish credibility. Additionally, Donovan provides analysis and consultation for end-user organizations seeking to leverage these powerful technologies.
Donovan has written on and provided consultation for a number of emerging and established CRM companies including Hewlett-Packard, Magnifi, Andromedia, WebTrends, Eprise, NetPerceptions, eCal, Baan, Siebel Systems, Great Plains, OutReach Technologies, and Renaissance. Prior to joining Aberdeen Group, Donovan was an E-Commerce Market Analyst at GE Information Services where he developed strategic and tactical marketing plans. Before that, Donovan was Program Manager for the Baltimore-Washington Venture Group, a leading forum for bringing emerging companies and the venture capital community together.
He has been quoted in leading publications including InformationWeek and InfoWorld.
Donovan Gow can be reached at gow@aberdeen.com or by calling 617.854.5260.
Bill Hills is Senior Analyst for telecommunications software at Aberdeen Group. He covers carrier telecommunications software, computer telephony, and telephony-based speech recognition applications. He has previous experience as an analyst covering CRM applications in the Enterprise Business Applications group at Aberdeen, and he was a co-author of three reports on CRM. He has authored numerous other Aberdeen Group publications on computer telephony, CRM, and telephony-based speech recognition. He has been quoted in leading publications including InformationWeek and InfoWorld.
Aberdeen Group is located at One Boston Place, Boston, MA 02108. For more information, call 617.723.7890, or visit www.aberdeen.com.
