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Go Digital or Die - CRM Evolution 2016

Fri, 27 May 2016 17:06:12 -0400

CRM Evolution 2016 - Conference at a Glance

CRM Evolution 2016 revolved around two main topics

customer experience, customer engagement
digital transformation

As part of these three main topics many speakers were about how to get there, which includes thinking and talking about machine learning, predictive analytics, and, of course, the Internet of Things. The CRM Evolution 2016 conference, organised by David Myron and chaired by CRM guru Paul Greenberg once more had an impressive lineup of speakers, starting with two highly impressive keynotes, held by Dennis Snow, formerly of Disney on Monday, and Brian Solis from Altimeter Group on Tuesday. As before it was co-located with SpeechTek and Customer Service experience, the latter chaired by Esteban Kolski. This combination guarantees a lot of high caliber attendance and a lot of networking opportunity, something that Paul Greenberg very strongly and actively supports. It is virtually impossible to not network … According to colleague Scott Rogers, although the conference appeared to be bigger than the years before it all seemed more intimate, but not crowded, which probably can get attributed to a good choice of venue. The event being vendor independent is only the icing on the cake. In my eyes this is the one CRM related conference that one must not miss. In contrast to last year I attended CRM Evolution only, which in retrospective was a mistake. But let’s have a look at the conference themes.

There is no CRM without Customer Engagement and good Customer Experiences

In the opening key note Dennis Snow told us about the Disney way of creating great customer experiences, which basically follows three simple rules

Design your processes with the customer in mind, not with internal/operational priorities; look through the lens of the customer
Pay attention to details
Create little “Wow Moments”. These add up to a lasting great experience and are easier to achieve than single “big” experiences.

To me the most important message that Dennis conveyed is that the simple things and consistency are what matters. Consistently provide little experiences throughout the customer life cycle. He underpinned this with some examples from the ‘ordeal’ of getting out of the park and back into the hotel. Everybody is exhausted, kids may be edgy, riding the bus is usually not fun. What about the bus driver singing some songs or doing a little trivia? The rooms showing some little surprise, like specially folded towels? Another of his core messages was that a company gets loyalty and advocacy only by creating those “wow” moments mentioned above. For this to be effective, however, it must not fail at base priorities. Customer expectations can get mapped to a pyramid. Every customer expects accuracy and availability. These are just the baseline, however. If a company fails at these then there will not be a good customer experience. There is also no chance to create wow moments in these layers – only negative ones. Opportunities for wow moments lie at the top of the pyramid, where a company can become a partner or ultimately become a trusted advisor. The latter was also emphasized upon by other speakers and during the panels; e.g. when it comes to selling it is now paramount to become a part of the customer’s network of trust. Michael Fauscette provided some survey data showing that vendor sales professionals are about the last ones to be influential to purchasing decisions and they nearly 2/3 of all surveyed companies agree that they engage with a sales person only to seal the deal after the decision has been taken. On the other hand, even more would appreciate being engaged by sales persons with relevant and contextual information. This currently does not come from vendors. Denis Pombriant had some good words to say about this from a loyalty angle. He started off with the observation that due to poorly implemented loyalty programs around 6.2 trillion dollar get wasted per annum due to customer churn etc. His basic conclusion was that a company cannot buy customer loyalty anymore but needs to earn it via superior engagement and providing a superior customer experience.

Go Digital or Die

The second big topic was digital transformation. Digital transformation can be defined as ‘the realignment of, or new investment in, technology, business models, and processes to drive new value for customers and employees and more effectively compete in an ever-changing digital economy”. The consensus opinion can be summed up as ‘go digital or die’. This message was hammered home in his usual refreshing style by Ray Wang and, from a more organisational maturity point of view by Brian Solis during his day 2 keynote. Brian Solis looked at digital transformation from organisational maturity and people points of view. He started off stating that one is on the wrong end of innovation when waiting for someone else to tell what needs to get done. Innovation, also digital innovation and innovation in customer experience, starts from within: Observe, believe in it, act! Similar to Dennis Snow the day before Brian Solis makes it a strong point that innovation in customer experience is about making the company “conform to expectations and aspirations of people instead of making them conform to assumptions or legacy investments and processes”. If people look for shortcuts, then the designed experience is wrong. Ray Wang stated that digital disruption is not about a technology shift but that it is about transforming business models and how businesses engage with their customers. In his opinion products and services will become less and less important. Business models will shift to sell outcomes or customer experiences, which are fed by data that is converted to insights. This will also allow for developing business models that couldn’t be imagined before. He provided a few examples like Symmons Industries who built a business model around sensor driven shower heads. These shower heads help hotels mitigating a derailer of the experiences they provide while allowing Symmons Industries to move competitors’ parts and services out of hotels that use their shower heads.

Tying it Together

The connection between customer engagement and customer experience on one hand and digital transformation on the other hand is insight. Insight is data converted to actionable knowledge. In so far predictive analytics, machine learning, and Internet of Things are the glue. The ability to meaningfully engage with relevant, timely, contextual information (at every touch point, if it is allowed to add yet another buzz word) requires data and the ability to do real-time predictive or, in the words of Ray Wang ‘anticipatory’, analytics. Ray Wang defines anticipatory analytics as predictive analytics plus machine learning. Personally I’d rather think that this is an unnecessary distinction that probably will vanish soon. Predictive analytics will embrace machine learning instead of relying on static models. The necessary data comes from all types of sources, traditional ones as well as from an increasing number of sensors – the Internet of Things. How to strategically put all this together was covered by various speakers, including Barton Goldenberg, who places the CRM system as the hub of a number of systems that jointly implement a coherent strategy. Sheryl Kingstone looked deeper into how to use especially predictive analytics to achieve better customer engagement by delivering contextualised and personalised experiences consistently across channels. Volker Hildebrand from SAP succinctly said that “marketing has become a weapon of mass distraction” and that companies need to deliver reliable, contextually relevant, and timely information in a way that is convenient for their customers – or else they face the risk of getting out of business. A path of getting step-by-step to a very consistent and successful customer engagement in the retail world that combines online- and offline behaviour was also presented using the CRM approach of General Mills as an example. I found this one very impressive. Amy Halford and Molly Hjelm who presented also emphasised that “CRM is responsibility”, meaning that CRM is not only about getting customer data but also about giving back to customers, which nicely ties into Denis Pombriant’s findings that customer loyalty needs to be earned. They also put an emphasis on one theme that I haven’t heard much about in other tracks: Data Quality! Data needs to be invested into in terms of quality and tagging in order to be really useful for CRM processes.

CRM Evolution - Some not so random Thoughts

Fri, 21 Aug 2015 22:07:47 -0400

CRM Evolution 2015 was a very vibrant conference with lots of discussion that included a number of high profile industry influencers. For me as a first time attendee it was amazing how approachable many of these people are. But then this might come with the territory.

To understand these takeaways it is important to know that my reason for attending was getting into closer touch with what is going on in the CRM world outside SAP - and New Zealand. So, these are purely notes and thoughts that result from sessions, discussions with influencers, speakers and other conference attendees, and not learnings from vendor briefings. Also, this event was split into three separate conferences:

CRM Evolution
Customer Service Experience
Speechtek

I nearly exclusively concentrated on CRMEvolution and one session from the Customer Service Experience.

First things first: Was it worthwhile coming all the way from NZ? This is very clearly a yes. Paul Greenberg and the team did an amazing job in lining up interesting speakers.

What now are the topics that currently seem to move the industry in random order?

Customer engagement (CEM), customer experience (CEX), customer journey (CJ) and how these topics relate to CRM
Big Data, with a view on the Internet of Things IoT, and related to it: Predictive analytics
How to do things CRM right
Not surprisingly: The Future of CRM (technology as well as industry)

Also not surprisingly these are all interrelated.

CEM, CEX, CJ and CRM

The intersection of these three topics is extremely interesting. These are also controversially discussed topics. Paul Greenberg recently, in another “stake in the ground” article, gave current definitions of CRM, CEX, CRM, together with good rationales. I would like to not dive too deep into this topic for the moment and think that I will write down some more thoughts of my own soon. Only so much: A good customer experience and positive customer engagement rely heavily on relevancy. Relevancy is increased by addressing a customer/prospect with the right communication at the right time, using the right communication channel as well as the ability to consistently do it across all channels. I would call this channel agnostic, rather than omni channel.

Customer Journeys and their mapping are topics that still evolve, both from a vendor point of view but also looking at what analysts say. Of course customer journeys are handled differently in B2B and B2C scenarios. Mitch Lieberman presented the Sugar CRM implementation in a B2B scenario, which reminded me of the cross of a buying centre with an action plan, including predefined actions and communications channels for these actions that suit the corresponding stakeholder and the information. The idea is that a customer engagement happens best using the touch points suiting the customer representative best.

On the B2C side things are quite similar. Ray Wang sees customer journeys being mapped “intent driven”. This does basically mean to use all available data (i.e. Big Data, to use the buzz word) to figure out a user’s intentions and to construct touch points in a way that these intentions are already taken into account. This sounds like magic but is started to be put in place, e.g. in support scenarios. An example that came up in a later session is a telco that uses data as different as that gathered through a user’s web search activity, the status of her web router, browser, other users’ experiences, etc, to prioritise and suggest solutions - and this consistently through the diverse support channels.

This directly brings us to the next group of topics.

Big Data, Internet of Things, and Predictive Analytics

Big Data is probably last year’s big thing but the term still brings a point across. All of us are generating incredible amounts of data, structured as well as unstructured. One of my customers for example, a not so big retailer, sits on several tera byte of sales data, a treasure trove for targeted marketing. The amount of data is growing fast and thanks to this year’s buzzword: Internet of Things, which describes connected sensors that interact with each other, we with them and they with us, the pace of this growth will even explode. This amount and growth of data continues to be a challenge, although technology meanwhile allows intelligent near real time analysis of huge amounts of data. The good news is that IoT is creating structured data, but then all data that is generated via social media, including sentiments, is unstructured.

This is where Predictive Analytics, or Intent Analytics, kick in to support businesses in their customer engagement and CRM processes, and providing a satisfactory customer experience, which brings us back to the previous section. The telco in the example above uses the huge amounts of data that are generated via their touch points and applies predictive analytics “algorithms” on them to be able to help customers in case of a problem. This help will be offered via channels that are as different as chat, voice, IVR, the company web site. Of course this help also relies on a very good integration into their internal knowledge base that gets constantly updated so that the relevance of articles can get determined based upon all available data.

Other applications of Big Data- and Predictive Analytics are Oracle’s release of a social analytics engine that helps determining the priority of calls for help on social media (apparently based on the number of followers, e.g, who cries loudest gets better support …) or an energy grid provider’s ability to constantly analyse the status of its network with the ability to predict failures up to 8 days in advance. This is incredible useful for preventive action and the optimal planning of maintenance.

But back to the Internet of Things. We all are starting to carry around an increasing number of sensors. These sensors interact with us, we with them, and increasingly they with each other. It also leads to the development of platforms and APIs between platforms that increase the range of services that businesses can provide. Think of decades old scenarios like the your fridge ordering a refill of butter because butter is going to run short soon, or the current experiment of Amazon Dash, that essentially is a button that gets hooked up to your wifi network and does exactly one action: It orders a set product, which then gets delivered right to your house - maybe via a drone. Just be sure that the button is out of reach of your kids, or else you might get more washing powder than you can use in the next decade.

This interaction of sensors in combination with platform integration will allow the creation of services and experiences that we currently can only partly imagine. But I do not think that anyone has a clear vision of where this will lead, who will benefit of it (except the platform providers), how privacy can get maintained and what regulatory requirements are coming up.

CRM Done Right

This is a kind of eternal topic. Theoretically it is not that difficult to apply a number of seemingly common sense principles. Of course I need to acknowledge that every business and organisation has some constraints. Still it is really surprising - at least for me - how often simple principles like

start with an end in mind
iterate, have goals use small steps
write it down and make it measurable
foster an appropriate corporate culture
get your processes straight
provide the employees with what they need. CRM systems are not only for the management

are not applied. These are only the ones that were referred to most commonly at CRM Evolution but I think they paint a fairly complete picture.

Instead we still seem to see technically driven implementations that are intended to support management with more reporting and control capability and that do not yield positive results and lead to dissatisfaction. I think that this gets increasingly understood as being a problem, by businesses as well as by vendors, which is evidenced by user interfaces of these business systems getting more and more consumer grade and by an increasing ability of the software stacks to support little, targeted applets, either native ones or ones that are plugged in via an integration layer like REST.

The vendors getting their act done leaves the businesses in the hot seat. Without a strategy, a customer focused corporate structure and culture, and an implementation plan that is flexible enough to be regularly adapted to follow changing realities CRM implementations will continue to fail.

At this point let me bang my head against a wall once more: To me it still seems that CRM is a strategy, regardless whether the market has “agreed” upon calling it a technology. Technology doesn’t help. It is a tool, not more.

But now let us have a look into the Glass Ball.

The Future of CRM

CRM was pronounced dead by many pundits - multiple times. But it is still around and it is here to stay.

CRM evolved and it will continue to evolve. But what are the next evolution steps? What are the main drivers?

Main drivers that I see are

an increasing need for real time decision making
the necessity for companies to identify signals in a world with a lot of noise
the necessity for companies to be relevant to their customers, to stand out in a world that has a lot of noise

I think that these will result in some main lines that will govern the next steps of this evolution:

in the shorter term best-of-breed will continue to get stronger; we see it already now with many departmental and point implementations, many of them thanks to the cloud. In this respect we have gone full circle since the beginning of the nineties, from point implementations to suites, and back. This will be followed by
platforms with open APIs, rather than suites. Platforms and ecosystems are already there. What is not yet there is real platform interoperability. This is still project work. In the future this should lead us to a world where business objects and -services that are provided by different providers can get easily combined to assemble end-to-end processes - or, hopefully not, to a world that has only one remaining platform. Hasso Plattner formulated this thought of free combination of business objects to processes at the end of the nineties (OK, limited to SAP products) and had SAP Business by Design built to follow this thought; these days Bob Stutz formulates it fully generic. And he is right. The CxM market is more than big enough.
very, and I mean VERY, strong analytics capabilities that are directly (and automatically) actionable, driven by AI systems. These analytics capabilities support superior customer experience and superior customer engagement, which forms a kind of relationship between customer and business, whether the customer wants it or not. The customer engagement will be pre- and post-sale, always with the intention of making the next sale (the current buzz for this is “service is the new marketing”). It will happen on the “channel” that the customer prefers and have and use enough contextual information to provide relevant information, at the right time and place. To achieve this the analytics engines will be fed by both, structured and unstructured data, fed by numerous sensors and devices of sorts that we can only start to imagine now
customer engagement will first become channel agnostic and then, depending on how IoT develops, device centric. This is where it gets really fuzzy. We just don’t know enough about this yet.