Companies have historically taken a functional approach to customer relationship management (CRM), to address immediate business pains. Challenged to manage its sales pipeline and forecasts, for example, an organization’s sales department might implement a sales force automation (SFA) application. The same company’s support department, however, might select a call center application from a different vendor to better manage incoming calls and reduce call-handling times.
While these isolated solutions help alleviate immediate departmental pains, they are not architected to support more mature business processes. If the sales department wanted to start enabling its reps to check product pricing and availability, for example, the standalone SFA system might not contain this information. The company would then have to custom-build fairly complex integration to other systems — such as ERP or supply chain management (SCM) systems — to get this information. And this integration challenge could lead the company to lose its business agility.
Realizing the limitations of siloed system approaches, many companies are now seeking solutions that support end-to-end processes spanning all relevant areas of the enterprise. Consider the following case study, which walks through one company’s business challenges and reveals how it adopted SAP’s process-centric solution approach to achieve greater business agility and responsiveness.
A High-Tech Company’s Struggle to Adapt
Over the past few years, Commco, a leader in networking equipment, grew aggressively by acquiring several of its rivals. At the same time, it has been streamlining its production, supply chain, finance, and HR processes to benefit from these acquisitions. But Commco did not alter its go-to-market approach, so its sales force and support center agents are still selling individual products from its different acquisitions rather than selling solutions that leverage complementary products and services across its portfolio.
Commco was aware of this problem, but could not transform its business strategy to take advantage of the market potential. The result was that the company’s margins remained low, it was slowly losing market share to other nimble competitors, and its stock came under tremendous pressure.
Commco’s CEO and executive board knew that transforming the entire company into a customercentric enterprise, an organization that builds and adjusts all processes — from manufacturing to sales to service — to meet customer needs and expectations, would be challenging. So they hired external consultants and invested heavily to achieve this business transformation. While changes in Commco’s business processes and employee behavior were slowly starting to take shape, the company still faced significant challenges in executing this turnaround strategy. Why? As it turned out, the primary hindrance was the chaos in its IT support infrastructure.
Commco grossly underestimated how its existing IT infrastructure would bring this transformation to a halt. Even though Commco and the companies it acquired had invested heavily in tools to support its various departments, it now simply had “too much IT” — an abundance of siloed systems that were each optimized for a specific departmental need, but not for the overall company. Making the smallest change to the smallest business processes required months of impact analysis, planning, execution, and integration — and lots of money and skilled resources.
For example, simply bundling some of its diverse products and services and changing the price of that bundle required months of IT retooling. As a result, Commco could not create effective bundles and cross-promotions quickly enough to increase customer wallet share. Further, Commco could not make available all the right information to its sales and customer service personnel to take advantage of all possible revenue-generating opportunities during customer interactions.
SAP’s Process-Focused Approach to CRM
To deliver superior customer value, companies need a solution that supports complex, end-to-end business processes that span the entire value chain. SAP embraces this process-focused approach.
- When a customer calls a support center, the center’s service agent has complete customer visibility into past service and order history, as well as a full view into the customer’s existing assets and entitlements. This not only enables increased first-call resolution rates, thereby boosting customer satisfaction, but also ensures that service agents never give away free service unless the customer is entitled to it.
- A call center agent can resolve a customer’s issue in real time with access to the right knowledge resources — be they engineers in the field or product development leads, wherever they reside in the organization — and bring them into the resolution process in real time as needed. This, as a result, increases first-call resolution rates.
- In the event a technician needs to be dispatched, intelligent resource optimization ensures that the right technician is sent out with the right parts at the right promised time to complete the customer service order during the first visit. And when the technician has completed his or her work at the customer site, invoices are generated through native integration to financial applications in SAP ERP.
- Returns can be processed efficiently through the seamless management and tracking of products and parts’ reverse logistics. Deep coordination between customer support and product development ensures a reduction in future returns by proactively identifying and resolving critical product issues.
- The company can realize greater customer satisfaction and retention because of the effectiveness of superior customer service.
Using SAP’s process-focused CRM functionality, Commco can now fully realize its market potential. It can cross-sell and up-sell all relevant products and services to its customer base, increase customer retention and loyalty, and thereby grow its revenues and margins.