Strong case in need of proof

`Over 90 per cent of respondents felt unable to obtain a complete picture of customer needs'
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GIVEN the problems that businesses have had in implementing consultants' three-letter acronyms, it is perhaps surprising that managers still give them the time of day, writes Roger Trapp.

Nevertheless, there is another on the block. Stepping up alongside BPR (business process re-engineering), TQM (total quality management) and the like is CRM - customer relationship management.

And it seems that success in this area is elusive as it has been with any of the others. According to a report from SAS Institute, a large software company, there is a "continued gap between desire and reality".

This would not be much of a surprise to all those people who, for example, have had their banks seek to interest them in pensions when they have already taken one out.

But it is probably comforting to an organisation like SAS Institute which claims to be the leading provider of "information delivery software" - or the means of converting raw data into "the meaningful information that is required to support successful decision-making".

A survey of the financial services industry that it carried out with Professor Adrian Payne and Lynette Ryals of the Cranfield School of Management indicates that while CRM is seen as a priority for business success, organisations believe they have some way to go to exploit its potential.

Moreover, lack of effective techniques for measuring payback in this area seems to be hampering further development. Indeed, interviewees had an over-riding desire for a measurement tool that could analyse the success of their data warehousing and CRM schemes. Ms Ryals found some grounds for encouragement in that most boards were quick to understand the benefits of CRM and so helped push it forward. This had an impact on overall business practices, in particular providing "a much-needed bridge between marketing and IT" and evidence that looking at the customer relationship could help to build internal relationships.

However, Linda Saul, product manager with SAS, said the research supported findings from a survey carried out by the Harris Research Centre on behalf of the company and published last year. That survey, which questioned senior marketing executives in 100 UK blue-chip companies, found that nearly two-thirds of organisations had CRM strategies in place and believed it was important that they were able to integrate all the information held on customers.

However, she added, "over 90 per cent of respondents deemed themselves still unable to do this, and therefore unable to obtain a complete picture of the customer's needs, behaviour, attitudes and aspirations".

The results of both surveys showed the need to measure CRM initiatives to prove a business benefit that executives felt was there, Ms Saul said. She added: "In the last 12 months most of the large banks, building societies, insurers and retailers have deployed a data warehousing or CRM initiative.

"What they are now facing internally is payback time."