by Dale Hagemeyer

Benefits of CRM Rooted in Strategy

Sep 01, 20032 mins
CRM Systems

The striking thing about Procter & Gamble’s approach to CRM is that it is rooted in a strategy. Fully half of the user organizations I encounter can’t articulate how CRM—a business strategy—is part of their overall company strategy. Consumer goods companies embark on CRM as a tactical response to a need, such as managing trade promotions. P&G, on the other hand, has an articulated CRM strategy and a phased, multifaceted approach. Its IT executives clearly see themselves as business strategy co-owners; they talk not about the technology but about enabling business processes to strengthen customer relationships. Bottom line: Have a strategy and make sure everyone understands it.

The business processes of the consumer goods industry have not changed in decades: Understand the opportunities through analysis, plan the product and promotional mix at the geographic and customer levels, link the product demand requirements to supply chain, monitor execution and competition at the store level, and settle with the customer for merchandising activities. P&G understands how those processes interrelate and has a strategy for enabling them in a way that will better address customers’ needs. Bottom line: Focus on the processes that meet customer needs.

P&G has walked a fine line between over-customizing applications and leaving them too generic. To have a global standard and a single view of the customer globally, there must be some provision for changes in business practice. Many consumer goods companies have tried to force a single standard on all operating units only to have them revolt and choose their own tool. Conversely, going overboard with customization becomes a support nightmare and endangers the project by drawing it out, making stakeholders impatient. Bottom line: Develop a strategy and focus on customer-facing processes first. Then choose a vendor whose capabilities closely map to your approach and let you capture local nuances.