Can’t Talk Cream and Use Skim Milk
Best of the Season to all. I truly enjoy this time of year as it relates to family gatherings conjuring up memories of Christmas past and social get-togethers sharing the pure spirit of the Season. It is also the time of year a few dealerships come to dread because of a precursor to lower unit sales and a party atmosphere offering a complacency of work ethics. For years the automobile business has aligned this time of year with a negative attitude thus, “expecting the worse” thinking has settled into a paradigm. Psychologists and others have proven time and time again that ‘you become what you believe’ so if you think you are going to have an off month, you will. Conversely, if you set the tone in your store that the month of December is going to be a good time to develop some good relationships, learning new methods training and processes in order to be prepared for and affecting better unit sales, service and gross profits then you become what you (and your people) believe. The truth of the matter is there are some stores that do quite well during this period because they take this different attitude and develop their team members toward enhanced improvement. They also take this time to develop good practices and analyze what processes will take them to the next level of business.
The single process that often becomes crippled by managerial obligations and distractions is managing (or should I say Leading) the team to respect and prosecute the essential CRM elements to their fullest.
Of course we all know this acronym represents; Customer Relationship Management. But that is where it ends because we could line up 20 people and ask them to actually define what Customer Relationship Management means and we would most likely receive 20 different answers. Why? I would presume it is partially attributable to what one’s responsibilities are.
The DMS tech person would probably go after the customer data content for definition,
The Internet Manager might look to data as well revolving around lead management information, and their ability to contact the prospective buyers,
Sales consultants might think pre-printed customer cards and letters and daily marketing plans,
Call center folks might lean towards customer oriented phone skills and handling objections,
The Dealer Principal might see it as Owner Base customer retention,
Service Department looks to appointments for the department and mailing ads to customers,
And, on it goes. The interesting thing here is they are all correct in their definition of what CRM means to THEM. What the dealership needs to do however is define CRM in terms of what it means to the “entire” store.
Customer Relationship Management should be a business strategy built around the concept of being totally customer-focused. The main goals are to optimize revenue through improved customer satisfaction via improved interactions at every customer touch point. This can be accomplished by a better understanding of customers, based on their purchasing patterns and demographics, and better information empowerment at all customer touch points, whether with employees or other media interfaces. CRM entails all aspects of interaction a company has with its customers, whether it be sales, service or support related. This is a means to gain trust from customers by meeting the needs of each customer in a more personalized way in order to increase sales.
When you remove common sense from CRM, the extra, new ingredient is the ability to store and retrieve accurate customer information so you have a new way to do business in a way that improves customer service. In an ideal world, this customer information will be integrated with operational processes to give a seamless customer interface from inquiry to delivery of products or services. CRM is therefore based on the idea of tailoring your response to each customer’s profile using information collected about that customer.
Recently I met with several Dealers and asked about their CRM efforts. They all responded basically the same way – “We really don’t use the capabilities properly”. I asked why? The response again was similar – “The company that installed it came here and trained us on using it but not really HOW to use it with the processes required like phone skills”. Phone skills are the new cornerstone for success in this business climate. It represents 80% of all opportunities to do business. If you are not training in the new phone skill development strategies you are flat missing the boat. If you want a few ideas here on how to get going, shoot me an email.
Perhaps the following information could provide a springboard for your store in developing a sort of CRM Mission Statement so everyone has a clear understanding of their individual mission and what CRM represents to your overall dealership. There is power in perspective so don’t be locked in the past.
- Implementing total “Customer-Focused” business strategies;
Everything we do has to have the customer’s best interest in mind. We’re having so much trouble defining CRM for one simple reason: so many of us are determined to define CRM as something less than it is. Why? Because it’s easier to “implement” that way. Hey, if we can cut it down to a couple of simple steps, even one, we can slam it in quicker. Unfortunately, the only thing that gets “slammed” using this abbreviated approach is us. So let’s define CRM for all it is: a complex, four-step process with far-reaching effects on the very way we conduct business.
Starting with developing customer-focused business strategies—also known as the step we most want to avoid, because it’s all about planning. Who has the time and patience for planning? Any dealership that wants to be successful.
The object of planning customer-focused business strategies is to find win-win opportunities with customers. Do more that benefits them so they’ll do more that benefits us—like buy more from us and stay with us. The “customer relationship” planning approach is relatively simple. Put yourself in your customers’ shoes. See through their eyes. Discover what they want and how they wish to be treated. Even anticipate what they don’t want yet, but will. And when you’ve done that, you’ll be ready to identify the best mutual opportunities for your customers and your company. Then you can prioritize these opportunities, pick the best and put them into play. Obviously there’s a little more to it than that, but that’s the gist of it.
Very important to understanding customer relationship planning and how it’s done is recognizing these significant departures from traditional market planning:
- You plan everything around customer wants, not company goals.
- You focus on listening to customers, rather than forcing them to listen to you.
- You relegate promotional marketing communication—including database marketing, e-database marketing, e-marketing, etc.—to a secondary role, operating in the shadow of the more important informed, informational dialog with customers.
You get the picture. And now you get to rush out and put all this into play, right? Well, not exactly, because implementing your new, customer-focused strategies will almost invariably require you to change how you do business. And besides, where’s the software? Can’t do CRM without software, right? But more on these issues in the next three steps.
- CRM which drives redesigning of everyday functional activities.
Redesigning functional activities is otherwise known as the step we forget about altogether. Why? Because we’d rather get ambushed by it, catch a whole quiver of arrows in the chest, then die a dramatic death in the corner service bay. Why? When you change to more customer-focused business strategies, you have to work differently. Otherwise, you’ll do the same stuff you’ve always done. But there is a tendency to “keep on doing things the way we know” while trying to go somewhere else. Ergo, we leave functional activities as they were.
“We have to figure out how to reconfigure our organization so that everything we do is designed to help customers and nothing we do adds unnecessary cost.”
Doesn’t work. Instead, we have to carefully assess the roles of all departments interacting with customers-to see if they’re adding value to customers, or adding cost instead. Then we have to figure out how to reconfigure our organization so that everything we do is designed to help customers and nothing we do adds unnecessary cost.
Reorganizing the organization to act more in accordance with customers can be quite a chore. But so can cleaning up the mess after you try to implement CRM while working at cross-purposes with powerful departments like sales, service, accounting and IT. So you have to take this step if you are going to succeed. You can only take it if senior management wants to develop it badly enough to bite the bullet and do the right thing by customers, which is often a hard thing by the organization. There are new strategies to be employed and you better have them in place. Better plan on some good solid 21st Century CRM training for your people here or you will be tomorrow where you are today.
- CRM which demands re-engineering of work processes;
Now let’s look at the third step, re-engineering work processes. Actually, many CRM implementers try to leap over steps 1 and 2 to start with work processes, almost always resulting in one of two outcomes. The first being they automate work processes instead of placing value on relationship development. The second is… well, imagine moving the lot around with blind folds on your employees. But let’s not let little accidents like these deter us from serious thinking about a very important CRM component. Especially when we have a fierce tendency to do re-engineering without thinking much about what we’re doing.
The function of process re-engineering in CRM is fairly obvious. In order to put the customer in the center of our business circle, we have to change departmental roles and responsibilities. And when that happens, we have to adopt new work processes. Otherwise, we’ll do the same work we’ve always done with the same outcomes yet hoping for a different result. But how should we change work processes? Here’s where things get interesting. We have two basic choices—re-engineering to perform each process step as efficiently as possible or re-engineering to maximize “throughput” from the beginning of the marketing/sales/service process to the end. We normally opt for the former—which might work if marketing, selling and service were factory stuff with predictable work flows. But they’re not. Instead, we have these unpredictable elements called “customers” that refuse to cooperate and do things according to our schedules.
Without drowning in the science of process management, suffice it to say that in conditions of uncertainty, trying to maximize efficiency up and down the process chain is usually an unmitigated disaster. In contrast, maximizing throughput usually gives us a far superior return on our marketing and sales resources. Processes will take you to the next achievement level but you better get some training installed in this area as well or again you will be wondering where you are headed.
- CRM which is supported and facilitated, not driven, by CRM technology.
In this last step we’ll look at selecting the best software that supports or facilitates (but doesn’t drive) new workflow and work processes and your people’s ability to work more productively.
We all know CRM software comes in all shapes, sizes and functions. In fact, the functions span a broad continuum from marketing automation on one side to field service on the other. And, please note, the end-to-end functionalities are so dissimilar that no software package on the market handles every function with better than “check box” proficiency. That’s why it’s so important for you to identify your “sweet spot” needs and compare your focal point to the focal point of every software system you’re considering.
Every system on the market has a sweet spot somewhere on this continuum. And every system is next best at providing the functionality on one side or other (but rarely both). Proficiency then declines with distance from the sweet spot. So don’t let any software sales type sweet talk you into believing that their system “does everything.” You can also over pay for software so do some serious research before you commit long term.
Key Point: Good Leadership is required to get good results. Make sure your team is doing everything possible to add value to your store’s success by instituting solid CRM management strategies in order to grow your business, identify more prospects, create a greater community network, and provide your employees with powerful ways to engage every customer at every touch point.
If you would like a few process ideas please send me an email and I will get some ideas out to you. Keep your vision focused on the possibilities not the problems.
Author: Chuck Barker
CHUCK BARKER is President & Founder of Impact Marketing & Consulting Group, located in Virginia. He has assisted Dealers & Corporations across the country in Sales & Service Development training programs, Management Leadership Workshops and Business Improvement/Analysis Consulting. He is a pioneer in BDC, CRM, Best Processes and Team Member Development since the early ‘90’s. Chuck has held Automobile, Corporate and International Executive positions for over 27 years. Chuck has been a monthly author/contributor for Dealer Magazine for over 11 years. Email: firstname.lastname@example.org.