Think long-term on CRM, users told

IT directors should justify customer relationship management roll-outs on the basis of long-term business growth rather than short-term cost savings, analyst group Gartner said last week.

IT directors should justify customer relationship management roll-outs on the basis of long-term business growth rather than short-term cost savings, analyst group Gartner said last week.

Gartner's analysts also told delegates at the firm's annual CRM conference that there was likely to be a new wave of build-your-own CRM projects undertaken this year, because less than 60% of current packaged applications met the specific requirements of companies.

"Once an enterprise implements packaged applications, it often finds that the processes it has modelled have become rigid and inflexible," said John Radcliffe, research vice-president at Gartner.

"Improving business processes can be made difficult once an off-the-shelf application is installed."

But Gartner's headline warning was that funding for CRM initiatives is regularly only approved for projects with payback periods of less than 12 months, with the emphasis on cutting operational costs rather than on improving customer loyalty to boost long-term prospects.

It said that CRM implementations were often treated as pure software roll-outs, without sufficient attention paid to making business processes more customer-centred.

"Most firms say 'we've done CRM,' but it is not just installing a box," said Scott Nelson, managing vice-president at Gartner. "Organisations need to do more than claim that they are customer-centric to achieve this aim."

Nelson added that consumer power would need to be leveraged into CRM systems, and the inclusion of social networks and communities into CRM plans would soon climb the agenda.

Related article: CRM helps EIC increase contract wins


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