Putting the C back into CRM

What have you and your clients gained from your expenditure on CRM? Paul Denvir looks at how a firm can get more from these programmes.

How much has your firm invested in CRM over the years? If you add together the direct and indirect (time) costs associated with technology purchase and development, process improvement, culture change, training and skills development what is the total cost?

And what have your clients gained as a result? What demonstrable extra value have they received as a result of your investment? For some of the organisations we know this added client value is significant, demonstrable, measured and clearly recognised by their clients. In these organisations, too, the effects on their own bottom lines are clear. By adding value to their clients’ businesses they have reaped the rewards in increased loyalty and retention, improved reputation and thereby improved new business figures and more, and better, business from their clients. They have achieved a return on the money and time spent on CRM because their clients have.

This is especially true in a world where the Procurement Department is taking more and more interest in the purchase of professional services. Procurement professionals want to see demonstrable value. They may not insist on lowest cost, but generic platitudes about ‘the value in the relationship’ will not wash. Client value can be generated by many things but if investing in CRM does not contribute, why invest? Why indeed?

The stated aims of one multi-million pound CRM initiative we observed included helping the organisation to:

  • Achieve a greater “share of its clients’ wallets”
  • Cross-sell the range of its services to its Key Clients
  • Improve the efficiency of its delivery and hence to increase profitability by x%
  • Manage the contacts between the firm and its clients so that all fee income could be measured against the costs of managing the relationship
  • Make more efficient the communication between the firm and its clients
  • Tie the client into the firm rather than to an individual partner.

These are all very interesting aims but where is the client in all of this? What will the client gain? If the design and implementation of a way of managing client relationships is focused too narrowly on the firm’s interests, and client benefits are not at the top of the list of priorities, it will be very obvious to all of that firm’s clients. As it happens a recent survey by Nisus Consulting into the purchase of legal services by FTSE 100 companies provides evidence that clients are seeing little or no benefit to them or their organisations from all the investment in this area over the last few years.

Putting the C back into CRM means suspending your own firm’s interests (for a short time!), focusing on designing a way of working (and, perhaps, a system) that will generate significant benefits for your (key) clients and then planning to derive the greatest benefits to your organisation from the increased satisfaction and loyalty of those clients. In this way the specification for the priority elements of a CRM programme (in all areas – values, culture, skills, process and IT) begins with the firm’s clients.

The stated aims of such a programme might include helping clients to:

  • cut their costs by x% over a period without sacrificing the quality of the advice they receive;
  • improve the capability of their key staff in key areas to enable them to take over more of the work currently done by outside advisers;
  • manage their budgets more effectively;
  • increase the speed at which they can access outside expertise;
  • access innovative ideas and new areas of expertise; and
  • understand more quickly when and where external advice is necessary.

As a marketing professional in a professional services firm I am sure you could think up a whole lot more. But, then again, why should you? Rather than second guessing the key areas of value desired by clients the best course would obviously be to ask your clients. You probably engage in a number of ways of understanding the priorities of the key people in your client organisations. Do you then take this insight and feed it into the firm’s CRM plans and investments so that these investments reflect those priorities? Are you also part of the minority that check regularly that their clients are gaining the value commensurate with the investments in money and time you are making? If you are then we believe that you are ahead of the game. And yet! There may still be more to do.

At point A one of our excellent partners or associates starts to work with the client on a significant piece of work and over the next few weeks manages to give the client a fantastic experience of our firm. By point B the relationship between the client and our colleague is as strong as it could possibly be. Everything has been delivered to time, the client has been delighted by the extra value they have received throughout the project and everyone on the client’s side has really enjoyed working with the firm. At point B the piece of work is finished and the client has no further need of our services for a number of months. Our colleague’s memory of the high esteem in which he is now held is, however, engraved on his soul!

The partner/associate now goes off and does a similar super job for another client and then another and then another. Meanwhile our first client’s life goes on. Perhaps he reorganises his team, has to deal with a crisis in one of his factories, has to withstand a takeover bid, survives his PA leaving and suffers his wife running off with the milkman! Whatever the details his memory of the wonderful work we have done is rather less fresh than our own. The ‘enthusiasm curve’ declines to point C.

For the firms that do not manage client relationships between assignments the next contact might occur at point C, perhaps when the client is understood to need more advice. In that case our partner might be surprised by the lack of warmth in response to his phone call. And yet from the client’s viewpoint there is a contrast between our protestations of genuine interest in him and his business and the fact that we only seem to get in touch when he has work to give out. Obviously none of us is money-grabbing by design, it is just that we have been too busy to demonstrate how much we care. The problem is that clients cannot read our intentions, they can only judge us by our actions. As the curve declines towards point C a client who would not have entertained the advances of rival firms at point B may start to become more interested in seeing “what else is available in the marketplace”. Clearly one of the major functions of any CRM process would be ensuring this decline does not happen.

Yet another danger now looms. Our fee earners know they need to keep in touch, they know the CRM system allows the firm to communicate with their clients when they are not fully involved with them, but they are busy and it is difficult for them to invest time in this on a regular basis. So they make sure the client’s name is on a marketing database and ask for the marketing department to ensure they receive “all relevant mailings”.

Rather than stop the decline we seem to have made the curve steeper! This is because anything the client receives that is not positive is not neutral – it has a negative effect on the client’s perception of the firm. The client can’t understand why, when he has invested time in ensuring we understand him and his business our firm insists on sending irrelevant information through. With the best of intentions we are continually giving him the impression we don’t understand him or, at least, we don’t care enough to make sure he only receives information that is valuable to him.

Too often (even the best of) CRM systems seem to encourage blanket marketing – “we do it because now it is easy to do!” If our clients are to receive value from our CRM effort it must be designed to facilitate one-to-one marketing – at the very least for our designated key clients. Client relationship partners cannot abdicate responsibility to the marketing department. They must know their clients well enough to ensure that they know what should be sent, and what not, and then must take the responsibility for making sure the right things are done at the right time. In that way the client’s enthusiasm can be maintained and improved.

At points C to G our investment in CRM has helped to enable, direct and motivate actions that add real value to this particular client – he is getting a real return on our investment. Our (firm’s) return comes from the actions he takes as a result of his continued high enthusiasm for us and for what we do.


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