• silicon.com
• Technology
• Software

By silicon.com, 27 October 2004 12:10

NEWS 27.10.99 Many customer relationship management (CRM) initiatives in the world's largest companies are at "serious risk of failure", according to research from the Meta Group.

Although 80 per cent of companies polled said they have at least one CRM application up and running, they are failing to benefit fully from them as they are not using data warehouses for in-depth analysis. Few of them are using applications that allow proper collaboration with customers.

While many companies are employing customer-facing applications such as call centres and websites integrated with front, back and mobile offices, Meta estimates the world's largest companies will have to spend as much as $250m over the next two to three years to achieve tangible returns on CRM investments.

Mark Huey, Meta Group senior research analyst, said: "It's often very easy for companies to justify expenditure when there are obvious, short-term returns on investment. But getting it right in the long-term, getting that 360-degree view of your company and its dealings with customers, is harder."

The report advises companies rolling out CRM projects to "take dramatic action to optimise their systems around the customer, or their customer relationship investments will not pay off".

Toby Detter, customer service programme director at Shell, which has implemented a large-scale CRM project, said: "We haven't had problems with the data mining side of CRM but it depends on what you're trying to do. The challenging part of CRM is changing the mindsets of people in established companies and the way they approach CRM. That takes time."

Martin Riddell, European marketing director at CRM vendor GoldMine, added: "CRM isn't a technology, it's a business process. A lot of CRM solutions aren't implemented properly - within enterprises they can take 12 to 18 months, and businesses are likely to change in that time."

For the full story, click here.

27.10.04 Five years on and have organisations made CRM strides? Maybe a few.

When this publication asked a panel of CIOs and other senior users about the measurable return on investment from CRM we heard plenty of negative comments.

There is little doubt that CRM can and does help businesses on a daily basis. Since the above article was written, many organisations have improved their CRM technology and - critically - processes. We have even seen new models of using CRM software, such as renting it over the web.

But - and you knew this was coming - CRM is still too often poorly conceived with no fundamental changes in corporate culture to accompany its widespread use.

The result is that IT and marketing departments - though we suggest the former, more often than the latter - get the flak for investment that is sunk but often considered wasted.

How proficient will we be in the use of CRM in another five years' time?