By Chris Bucholtz
I learned long ago that, for businesses to make significant changes or significant investments, it requires significant pain.
I learned this while covering the telecommunications industry, a collection of enormous corporations that saw change as an opponent of revenue. Back in the 1990s – around 1996, and the signing of the Telecommunications Reform Act, to be precise – a wealth of new technologies promised to re-invent customer service – and which could have conferred competitive advantage upon the first to adopt them. Not one of the major carriers bothered to do so. The pain imposed by customer defections caused by frustration with service issues was not perceived as great enough to move these companies to make an investment in new technology – a theme that continues to this day.
At the same time, however, the major telecoms were scrambling like mad to acquire new customers. The airwaves were flooded with commercials enticing customers to use their newly-granted privilege to shop for a new carrier. Many major telecom providers went so far as to illegally switch customers to their services without those customers’ permission. It was a boom time for customer acquisition.
But those customers were coming from somewhere – other carriers – and they were leaving for some clear reasons. Reason one, as is often the case, was price. But reason two was often frustration with a failed customer service experience
Had one of these very large corporations invested in customer service technology and improved the experiences of its customers, it could have reduced churn, lessened the need for expensive TV ad buys and avoided having to tangle with the FTC over “slamming” (the industry jargon for illegally switching customers). In other words, the technology would have easily paid for itself.
The pain point was there: churn was high, and thus frantic new customer acquisition was required. But, for whatever reason, it was impossible to connect the dots between the cause and the potential cure of the pain.
The telecom industry still hasn’t caught on to this, much to its shame.
Here’s the point, as it relates to CRM: you probably have some pain points within your sales, marketing and service organizations. Are you able to spot them?
If you’re a very small business, you know where the bottlenecks occur and when misfiring processes affect the customer. You actually experience the pain and thus you have the motivation to solve it and a clear roadmap to get to the solution
As businesses get bigger and more hierarchical, spotting the pain points and the things that can fix them can become obfuscated. Larger businesses are more complex systems, and the causes of customer pains may start well upstream. We know that a flawed marketing approach can hamstring sales, or that over-promising by sales can cause headaches for service. But are you able to connect the dots between where the pain happens and where the fix is needed?
More to the point, are the people in the organization capable of acknowledging where those fixes need to be made? For example, is your CMO capable of admitting that the poor performance of the sales team may have been precipitated by a faulty definition of the characteristics of a qualified lead? The CMO may deliver the right number of leads, but the sales team can’t sell to them.
To go deeper, could your product management team accept that the failings in service that are damaging retention are caused by an insufficient knowledge base? Could your organization connect the dots that problems with product delivery were causing an otherwise stellar marketing campaign to sputter? Could your business accept the idea that you may be spending money unnecessarily in one aspect of your operations to cover for the failings of another aspect in a seemingly-unrelated part of the company?
Pain shows up on the bottom line – it’s easy to spot there. But too many times we trot out tired ways of solving those problems (“fire the CMO!” “Can the non-producing sales people!”) that fail to go to the cause of the pain. It’s like taking an aspirin for a brain tumor – you’re treating the symptoms, not the cause, and if you keep treating it that way the outcome is likely to be dire.
Instead, try to think about the chain of activities, interactions and assets that make up your customer relationships and diagnose the real cause of the pain – and fix that. It may require the goring of someone’s ox at a management level; it may be uncomfortable; and it may even require an investment in new technology. But the outcome is going to have long-lasting positive benefits and, if you identify the real reason for the pain, you’ll come out of a more profitable business.