Applying CRM to Government

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Applying CRM to Government
Tony Lee tony_at_yescomm.com CEO YESComm., Inc.
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Agenda

• What is CRM?
• CRM Definition
• Relationship Optimization
• What is CRM for?
• CRM Process
• CRM Architecture
• Why Government needs CRM?
• Citizen to Customer Government to Enterprise
• With CRM, Government benefits
• CRM is not only technology

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What is CRM?

• CRM is a company-wide approach to customer
  interaction that uses customer data and
  information technology to take targeted actions
  across the business system that increase the
  values as well as the number of profitable
  business relationships with your customers
• Focused on developing profitable relationship
• Comprehensive set of initiatives across the
  customer lifecycle
• Supported by IT systems data warehouse, data
  mining, and e Busines

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CRM Definition

• A journey of strategic, process, organizational
  and technical change whereby a company seeks to
  better manage their own enterprise around
  customer behaviors. It entails acquiring and
  deploying knowledge about customers and using
  this information across the various touchpoints
  resulting in increased revenue and operational
  efficiencies.

CRM State
CRM Objectives
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Customer Management

• Revenue Enhancing
• Retain more existing customers
• Increase the profitability of existing customers
• Acquire more profitable, new customers
• Cost reducing
• Reduced marketing and acquisition
• campaign expense
• Increased response rates from
• marketing campaigns

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Organization
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Product Management
Process
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Transaction Management
Technology
Product- centric Operational System
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Relationship Optimization
An enterprise sets a major objective of becoming
a team that learns and coverts its strategies,
processes, interactions, measurements, knowledge
and communications into real action. It is a
cycle for long-term success and cohesive
management teamwork.
Analysis Refinement
Knowledge Discovery
Learning
Action
Customer Interaction
Market Planning
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What is CRM for?
Power is Shifting to the Customer
Changes in the marketplace dictate that
companies become more customer centric.
Brand and product focused
Retail and channel focused
Customer focused
Customer driven
Hierarchical
Distributed
Flat
Empowered
Organization
Functional Business Unit Silos
Product-based
Segment-based
Streamlined
Transaction Processing
Management Info. Systems
ERP and Back Office Automation
Front Back Office Integration
Technology
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What is CRM for?
In Out in Marketing
A fundamental paradigm shift occurs in market.
Whats Out!
Whats In!

• Mass Marketing
• Standardized Products
• Market Share
• Present Value
• Program Driven Marketing
• Know Your Products
• Manage Your Products
• Differentiate Products
• Acquisition
• 100 of Market, 10 of Customer

• One-to-One Marketing
• Customized Products
• Share of Wallet
• Life Time Value
• Event Driven Marketing
• Know Your Customers
• Manage Your Customers
• Differentiate Customers
• Cross-sell / Retention
• l0 of Market, l00 of Customer

Source "The One To One Future"by Don Peppers
and Martha Rogers, Ph.D.
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What is CRM for?
Framework
Customer Loyalty is a key source of profitability
Profitability increases as the customer stays
with the company over time
A very satisfied customer is six times more
likely to repurchase your product or service than
a satisfied customer.
apostle
Customer profitability
100 80 60 40 20
The sources of Customer Value
Zone of affection
Price Premium
Referrals
Zone of indifference
Cost Savings
Loyalty (Retention)
Revenue Growth
zone of defection
Base Profit
Development and retention costs
Terrorist
Customer lifetime
Acquisition costs
1 extremely dissatisfied
2 somewhat dissatisfied
3 slightly dissatisfied
4 satisfied
5 very satisfied
Satisfaction Measure
Source From Frederick F. Reichheld "The
Loyalty Effect" - HBSP, 1996
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What is CRM for?
Takeaways
Companys revenues, profits, and market share
and even your salary come ultimately from only
one source YOUR CUSTOMERS!

• Buy more from you even if your prices are
  (somewhat) higher than
• the competitors.

• Recommend you to their colleagues and even
  acquaintances
• For every complaint there are 10 others who
  didnt make the effort
• to tell you of their dissatisfaction.
• And since every dissatisfied customer grips to
  an average of 6 people,
• every complaint represents 60 people who are
  working around with
• a negative image of your company.

A solid base of loyalty customers

• Make you the standard for the organization

• Try out your new goods and help you make it
  better

• Use your such add-ons as training, other
  supports and other facilities.

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CRM Process
Measure Customer Ongoing Value
Embrace CRM Technologies
Build CRM Technologies
Collect customer information as a strategic asset
Identify Customer Expectations
Manage Customer Experiences
Align Strategies with Customer Value and
Expectations
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CRM Architecture
Operational CRM
Analytical CRM
Scope of Work
SCM
Legacy Systems
ERP
Data warehouse
Back Office
Data Analysis Value-added (Data Mining, etc)
CLOSED LOOP
Front Office
Customer service
Marketing Automation
Sales Automation
CRM Data Mart (Customer info, Contact
history, Transaction history, products, etc)
Mobile Office
Mobile Sales
Field Service
Marketing Automation
Campaign Mgmt
Voice (IVR, Agent)
Web Collaboration
CustomerInteraction
Face to Face
e-mail
DM/ Fax
Source Meta Group, June 1999
Collaborative CRM
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Why Government needs CRM?

• Governments around the world are discovering the
  power of the Internet to stream line processes,
  improve services and dramatically reduce costs.
• Web communication has changed citizens
  perception of government services placing
  increased demands on governments everywhere to
  sharpen response times and meet anytime,
  anywhere service expectations.
• Citizen wants a secure, personalized service that
  resolves problems. Also, Government can
  significantly improve constituent satisfaction,
  reduce costs, and provide 24x7 customer service
  availability.

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Citizen to Customer Government to Enterprise
Customer-centric governments achieve nearly 50
more success in providing easier customer access,
increasing service volume, getting better
information on operations, reducing employee
complaints, reducing employee time spent on
non-citizen activities and improving their own
image.
Citizen
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With CRM, Government benefits

• Improved Citizen satisfaction
• provide superior service through timely
  resolution of cases
• Increased internal efficiency
• reduce task times by answering citizen concerns
  in a consistent and coordinated fashion
• Enhanced employee job satisfaction
• provide employees with more time for value-added
  activities by automating mundane administrative
  functions
• Accountability
• drive accountability throughout organization by
  assigning and tracking work efforts
• Enhanced Communication
• provide a universal, customer-centric approach
  that facilitates knowledge sharing
  implementation of best practices

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CRM is not only technology

• CRM must launch with a strategy!!
• A CRM strategy needs to clearly define how
  you will be viewed by and manage all touch points
  with your customers. It should also define how
  you plan achieve this result.
• CRM is not IT project!!
• Customers interact with your company through
  people, processes, electronic media, transactions
  and indirect relationships. They typically will
  not know what language your tools are written in
  or what platform they run on.
• Employees mind must change!!
• The global economy has broken down consumer
  barriers, reducing geographic constraints. As a
  result, quality and service have become driving
  forces behind brand preference, loyalty and
  bottom line results. Be sure to look at your
  company as your customers do. Consider how they
  want to do business with you.

Top 10 reasons why CRM fails!!!

• CRM initiatives launched without a strategy
• The CRM strategy is not integral to the business
  strategy
• The CRM toolset is based on someone elses
  success
• CRM is launched with no regard for enterprise or
  customer interfaces.
• CRM is launched without customer input.
• CRM is considered an IT project not business
  initiatives leveraging technology.
• CRM is launched without defined metrics and
  objectives.
• CRM is considered a one -time event.
• Assume you have a customer-centric culture
  because you have customers time.
• No top down leadership and employee buy-in for CRM