It's the Customer St*p*d!

Hi Glen

True to my promise on Twitter and in Quaker fashion, I am compelled to respond to your post.

For all the discussions and arguments about what CRM is, it is pretty clear what it should not be. It should not be about technology, although CRM benefits from the right enabling technology. It should not be about outright management of customers, as customers increasingly wield the balance of power. And it should not be about relationships either, as Wim said, customers simply don't want them with the vast majority of companies. AT&T might want to build relationships with its customers, but its customers don't want to be friends with AT&T. Many of them don't even want to be customers of AT&T, but the pleasure of the iPhone is sufficient to put up with the pain of AT&T.

The key thing about real relationships is that they are two-sided. AT&T might want one with its customers, but if its customers don't reciprocate, the 'relationship' is an entirely spurious one. Research by Liljander & Roos suggests that only a small per cent of customers have any semblance of real relationship with the vast majority of companies, and where they do, it is generally with someone they know in the company.

Rather than wasting time on building spurious relationships, companies like AT&T should focus on understanding customers needs, in developing their capabilities do meet them and in doing so in a way that co-creates value for both. It is only by doing this exceedingly well that companies can ever hope to build the mutual trust and commitment that leads to the hope of a real relationship.

As the British Economist John Kay wrote about in his new book ?Obliquity?, the key to many things in life is not to focus directly on the goal you want to achieve but on all the little things that together allow the goal to be achieved. This is as true for real relationships as it is for anything else. Companies are well advised to forget about building relationships with their customers and to focus on delivering a fantastic customer experience instead. Those that do this really well, companies like Disney, Lego and Harley Davidson, have just the faintest of chances of building relationships with their customers.

Graham Hill
Customer-centric Innovator
@grahamhill ...

Thanks for your comment, Spiro ...

Well, as you can see from my post, I believe it's about the relationship. My organization, like nearly all others, has limited resources to deploy in engaging customers. We must seek the most efficient, effective ways for us to meet our customers' needs. We find it much more efficient and effective to establish relationships as opposed to focusing on transactions. For us, relationship management is a force multiplier.

I appreciate both Wim and you chiming in on this topic. Wim, I hope my tone in my reply to your comment wasn't too hard. I was rushing to complete another task at the time.

Glenn ...

How about a chicken omlet ...

CRM can't focus on it's customers, because it's focusing on the relationship. and if CRM is focusing on the relationship, then CRM itself is focusing on the needs and wants of a management system that compliments the needs and wants trying to be delivered by the customer.

but if CRM and agreeing with all the points Wim has mentioned is about focusing on the customers. it's the relationship aspect of customer's not the actual customer.

My point is, relationships in itself need to be managed, but without knowing what the needs of that relationship are, how will customers deliver the needs if really there is no relationship to manage them correctly.

The question then becomes is CRM about the customer, or is it about the relationship?

...

Thanks For A Great Comment, Wim ...

Always glad to inspire a blog post in someone:-) At the risk of channeling former President Clinton by responding, "That depends on what the definition of "Is" is," I don't believe what you described is CRM. It's something else. (I agree with your first four points.)

If you don't focus on the relationships, call it something other than CRM or be prepared for a lack of success.

Can't wait for your blog post.

Glenn

...

chicken or egg?

Hi Glenn,

Provoking last statement.. I do not agree with you in full though.

There are many ways to understand your Customer's needs without having a relationship. Most market research is conducted without there being any relationship at all. You can call, visit, observe etc etc many people when solving the challenges they have with performing a certain job they need/want to do, without having any relationship at all.

One can collect feedback from Customers these days by just listening to the conversations that take place in the "social web". No relationship needed (unless you define buying and using a product as having a relationship).

Furthermore I don't think that Customers desire a relationship. Having access to information on how to best use a product or service, or how they can benefit from other offerings your Company has, is what is valued. Not the relationship. Moreover Customers turn to peers in their networks to obtain this information. And this information is valued higher than the information a company provides.

Customers do not value a relationship, they value the product or service because that's what they use to solve their problems/challenges/desires for them.

Customers do not value interactions with your company, they value the information they need (which may be derived from an interaction with your company) to be able to derive as much value as they need from the product or service they use.

And that's why a focus on Customer needs is more important than a focus on your Customer's relationship with the company. Furthermore one needs to focus on the information a Customer needs to better meet their needs.

Hence, in the era of the Social Customer it may well be that, after understanding your Customers' needs, you may want to better understand how your Customers leverage ALL their relationships to obtain the information they need to increase the value they get from the products and services they use.

Alas.. this is turning into a post itself, and that's exactly what I'll be doing next ;)

Thx for the inspiration Glenn!