Getting down to business

Doug Miles of infor:swan asks what the letters CRM actually stand for in manufacturing today.

For many of us in manufacturing, a Customer Relationship Management system, which will help us know all there is to know about our customers sounds a little too intimate.

All very well for those kind folk in the financial sector who write to us every day offering to lend us money or wanting us to flourish their distinctive looking credit card, but not really matched to the frequently turbulent world of UK manufacturing.

The previous IT offering called Sales Force Automation initially seemed more desirable with its suggestion of bringing some regulation to that undisciplined bunch in Sales. Unfortunately, the initials of SFA seemed to describe what many of the early adopters actually achieved.

The problem we all have is that CRM is seen as a sales tool, because after all, customers belong to Sales. Well it’s perfectly true that the sales and marketing team are responsible for finding potential customers, and persuading them in their kindly and gentle way to become actual customers and spend big money. But from the point of arrival of the first order, others in the company become involved. Let’s just consider some of the reasons why a customer might phone or mail in to our company.

First they may have an enquiry regarding the order acknowledgement which doesn’t seem to match the quotation that our trustworthy salesperson gave them. Then they may ring in to modify the order in the light of reality. Quite soon they will start to chase deliveries, and when the delivery finally arrives, start to chase the items that weren’t in the box. Then they find it’s the wrong part, or it doesn’t work, or they don’t know how to make it work, or they need to send it back for repair. Meanwhile, the invoice will have been sent and it turns out customer has a problem with it, or he may pretend that he has when our friendly credit-collector rings to chase payment.

Meanwhile, fresh from the success of the first order, our dutiful salesperson is about to visit the customer again for a follow up order. Now in a small company, the tortuous dealings with the customer since the salesperson’s last contact may have taken place in his earshot and he knows what is happening. Once a company is over a certain size, or if the salesperson works remotely, the likelihood is that he will walk confidently into the customer only to be completely taken aback to find that there are major problems with the product, the delivery and the payment.

Worse still, the customer will probably complain that in trying to sort things out he has been passed around on the phone, fobbed off with promises, and frequently ignored. ‘I have to explain over and over again who I am and what the problem is. Then nothing happens.’ In summary, our management of response to the customer is in need of a big improvement.

So now we have it, Customer Response Management. Making sure that all those customer-facing staff in the chain are fully informed of what our history with this customer is, what exchanges and conversations have been had, and what issues are outstanding. Sales, Despatch, Help Desk, Service, Accounts and Credit Collection must all have access to this important data, and must be in a position to respond quickly and diligently to it.

What characteristics of an IT system can help? The customer relationship has been described here around a transaction, and its related issues. Transactions take place in the ERP system, which knows all about sales history, product deliveries, product histories, payment patterns, and credit limits. First, we must make this information available to all customer-facing staff quickly and simply. Then we must record actions, follow-ups and escalation procedures. The CRM system must be intimately linked to the ERP system – as it will be if we buy both from the same supplier.

Engineers can take it one step further. If we are doing nothing to measure customer response, then we cannot control it. In other words: Based on Customer Response Measurement, we can take steps to improve Customer Relationship Management.