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How Do You 'Can' a Jedi Master?


© November 2003 Joe McKendrick
Web Site: https://www.mckendrickresearch.com

A couple of years back, I had the opportunity to talk with Allan Frank, chief technology officer for AnswerThink Consulting Group Atlanta and formerly national partner-in-charge of enabling technologies for KPMG Peat Marwick LLP, about approaches to building knowledge management systems. "How do you can a Jedi master?" he asked. "How do you store the collective learnings of the organization? Why did we win that sale? What have we built somewhere else before? What did that design look like? We can take a relational database, slice it, dice it, and cut it, rotate those cubes, and do data mining. But in the end, the difference is what really animates an organization is a human being."

Companies have attempted to can institutional knowledge, spending millions of dollars on CRM systems. Management guru Tom Peters hit the nail on the head a while back when he declared that most businesses don't know squat about customer relationships. The ones that do have a sliver of common sense stand out like shining beacons. That still holds true today. The difference is that we are now trying to automate our way to customer-driven excellence. However, when you automate poor service, you get automated poor service.

That's a shame, because while many large businesses are spending as much as $30 million to $90 million over a three-year period on CRM systems, they still may be underestimating the costs of CRM projects by as much as 40% to 75%, according to Gartner Inc.

What are we trying to accomplish with CRM management? For one, self-service, which mainly means shifting data entry to the customer. Make the customer do the work. Tom Peters must be having a field day with that one.

Second, after years of trying, we're still trying to persuade salespeople to put what they know into databases and share their knowledge. I'm sure every good salesperson out there is only too happy to divulge his or her contacts and techniques.

Third, it means cutting down on mass marketing, which means less junk mail sent to every man, woman, child and dog across the land. I'm all for that one.

What's troubling about CRM is that it's being presented as a techno-fix to customer relationship management problems. Those companies that are already good at customer relations are enhancing their capabilities with CRM systems. Those that need to work on customer relations, however, need to address the root causes, rather than throw technology at the problem.

Ultimately, the way a company treats its employees reflects directly on the way it treats its customers. The companies that succeed with customers invest not only in technology, but also invest heavily in employee training and development. "The companies that don't do very well in establishing a good relationship with their people are also the same companies that don't do a real good job of establishing a good relationship with their customers," says Bill Brendler, author and frequent speaker on CRM issues. "These companies tend to be internally focused, 'thing'-oriented, and back-office focused. To shift to relationship management, you have to build a relationship with your employees to make that relationship happen with your customers. That's the complicated part."

Many CRM projects fail because of a lack of focus, without a vision, as well as a lack of attention to the human dynamics. To be effective at CRM, a company needs to be willing to change the way it does business. You can always sense when you're dealing with an operation with high employee turnover, versus a well-run shop.

What's also troubling about CRM is that it's rapidly converging with a related initiative called "knowledge management." In essence, information about customer relationships is institutionalized into some type of system, just as knowledge management attempts to capture all scraps of structured and unstructured data to preserve for future organizational endeavors.

This is probably effective for mass-marketing organizations. For example, a bank may be able to track when a customer's auto lease is up, and go to that customer just before the lease expires with a financing deal to purchase the car, or renew with a new vehicle. That history is maintained for all future customer representatives to see.

Business-to-business relationships, on the other hand, rely much more heavily on personal contact, and are often driven by serendipity. Repeat business is golden. Relationships - the old-fashioned person-to-person variety -- are a competitive advantage. If your sales director knew that your best customer's daughter just had a baby, you know to send some kind of gift. Likewise, if you had insight into a new acquisition your customer was planning to make, you could be there to lend support and reap new business.

Some companies recognize the value of serendipity. One company built a three-story headquarters building, but instead of elevators, they purposely put escalators in the center of the building, a big open space. Because studies show that people talk, and you can enable that serendipitous communication on escalators much more effectively than on elevators. The company wanted to encourage employees to bump into one another. The facility's planners knew that this was a good medium of information exchange.

Likewise, trade shows owe their existence to their promotion of serendipity. Can we automate and institutionalize this? Should we?


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More Articles by © Joe McKendrick


"What's troubling about CRM is that it's being presented as a techno-fix to customer relationship management problems."

What's even more troubling is that today's crop of business managers think that technology can fix everything, not just customer relations. "Data mining" is a classic example: what today's young turks call "data mining" is what us old guys used to refer to as learning from history. You don't need a computer to tell you about what happened in the past. Just talk to your customers and they'll be all too happy to fill you in on the things you'd rather forget.

"One company built a three-story headquarters building, but instead of elevators, they purposely put escalators in the center of the building, a big open space. Because studies show that people talk, and you can enable that serendipitous communication on escalators much more effectively than on elevators."

Elevators are the least likely of places where two or more individuals will talk. If anything, such forced close proximity virtually guarantees silence. <Smile> The escalator idea would be a good one if the consideration of 60 or 80 story office buildings didn't have to get into the picture. Wide open aisles often help too, as does a cheerful employee cafeteria.

"Likewise, trade shows owe their existence to their promotion of serendipity. Can we automate and institutionalize this? Should we?"

Serendipitous events do more to shape human activities than almost anything else. Why would we want to mess with something that has so much to do with why we are successful? This is definitely a case where the technology should remain unplugged and people should engage in old-fashioned face to face conversation.

--BigDumbDinosaur

But people die, move on to other jobs, aren't available right this minute, forget, mis-remember..

People also talk about things you don't need to know, are confused, etc.

It all does originate with people, of course, but tucking it away isn't a bad idea: one of the reasons we keep minutes of meetings, write books, etc. Tech is just another way of recording what people know or said they knew.

--TonyLawrence


I agree that anything of importance ought to be recorded for posterity. I'm just saying that we should not be using technology in lieu of face-to-face communication. Technology can store and retrieve information but cannot store and retrieve body language, vocal nuances and general context.

--BigDumbDinosaur

Well, it COULD :-)

--




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