A Brief History of SCRM


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Paul Greenberg put the stake in the ground by defining SCRM and said that we needed to grow if from there.

I agree. And it is in that spirit that I want to introduce this post. A little bit longer that most of my posts, but a way to start the conversation on what does SCRM look like once implemented.

A Brief History of CRM

In the first few generations of CRM we saw the basic three pillars (sales, marketing, and customer service), a common data model (probably the best innovation CRM provided to organizations), and common integration points to the existing systems in the organization: ERP, legacy, databases — even partner applications in occasions (look ma, no VAN!). The following picture is a basic representation of what CRM 1.0 looks like.

Traditional CRM Implementation

Traditional CRM Implementation

These implementations collected data across all functions in the front office, store it in a central location and use it. That data was all operational: who did what when, for how long, and what were the results. The promise of a “holistic customer representation” or “360 view of the customer” did not materialize since we were missing the most important item in the equation: what the customer wanted when they came to see us, why did they need that, and what was the result of the interaction. In other words, we had the content but we were missing the context and intent of those interactions.

Later we began to add “components” that complimented what we were missing. Created analytical CRM by adding analytics engines to it. Began to measure customer satisfaction via surveys and inserted that value into the customer records (not always). Became proactive by trying to get what we needed to make good decisions: context and intent. Products were enhanced, better integration added, and more powerful CRM solutions released.

CRM 2.0 was born, but not necessarily an improvement in the search for perfect customer knowledge. Despite collecting the information, and in some cases integrating it with the existing data, we could not mesh all the data, all the insights, and all the processes together. All our actions were reactive, and the customer was not directly involved as part of the decision-making: it was still company-centric in reality albeit the label of customer-centricity.

We began to include the customers perspective and we evolved more by adding EFM engines, predictive analytics (sales, marketing, and customer service), proactive customer service. We wanted to improve the relationship and get to work better with customers as we moved into CRM 3.0. There were some improvements in relationships – but the vast majority of the information we needed was still out of reach. Over 90% of customer feedback is in unstructured feedback: blogs, social networks, private conversations, chat and IM, emails and the like. Not being able to tap this data was limiting as to how much an organization could learn about their customers.

There were early attempts to explore this new world. Collaborative Customer Service (communities and forums), blog-trolling software with speech and tech analytics, different methods for feedback event beyond surveys (e.g. focus groups for customer service) were all attempts to collect and leverage this information. Some of them worked great, some of them not so much. Alas, the basic infrastructure for leveraging the information collected was still missing.

A Brief History of Social CRM (SCRM)

Enter the Groundswell revolution and the advent of Social Media into the enterprise. Organizations start to listen to customers. They acknowledge there is a lot of data about their business but don’t know how to find it or tap into it. We feel empowered by what we are discovering — but we still don’t have a framework to take advantage of this! The tools give some guidelines and insights as to how to proceed, but nothing really in the sense of strategy or what to do with it.

We are entering CRM 4.0 (amazing how Paul Greenberg’s book is also coming on version 4.0 — coincidence? I think not) and we need some guidance.

See the chart below for my proposed framework for SCRM:

Proposed SCRM Framework

Proposed SCRM Framework

A few things you will notice in this chart.

  1. There is nothing new to add here – everything you already have (if you have been following the evolution I described above) is still there. Few things you may need to add if you have not been following along, communities, EFM, integration with the cloud. How much and how? It will vary by your organization’s architecture and needs.
  2. There are two layers of business rules as they apply to social interactions. One tells the organization how to approach each channel, the other what to do with the data collected. If you had a CIH (Customer Interaction Hub (**)) implementation you would not need these (actually, if you had a CIH we would be having a very different conversation since that model already included most of what you need to make SCRM work). What is the CIH? It is a framework that I created that describes how to bring new channels into the organization and leverage them across the enterprise. Email me about it, we can setup some time to talk or I can send you some slides.
  3. Communities come at you from two different fronts: customer communities and partner communities. The new model for Enterprise 2.0 calls for many-to-many relationships between communities, this is simply preparing SCRM to be a part of E2.0.
  4. The cloud becomes a key component of your architecture. You can ask anyone who heard me before, I had forever maintained that organizations would not adopt hosted-CRM, SaaS, or whatever label you want to put on it without secure data transfers. Using SaaS solutions isolated from the rest of the enterprise is not a solution, is creating another problem. Thanks to the cloud (and we are not there yet, I know) we see a glimmer of hope in the near future to actually use SaaS solutions seamlessly integrated into the legacy and back-office systems.
  5. Feedback Management becomes the fourth pillar for CRM. This is the quintessential integration that makes CRM work in a social environment. Most of what we capture from the communities must be considered feedback. The limited operational data we obtain can be easily separated by the business rules and stored in the appropriate places.

A (Very) Brief History of Customer Experience

There is one more thing to talk about: the link between SCRM and Customer Experience. I believe this is where we will see the biggest improvement to organizations adopting SCRM.

Traditional Customer Experience Management relied on three components to do what it does: feedback management, business process management, and CRM . As we move forward into SCRM these components will change – as will the function of CE. See this next chart for a better idea of this change:

Shifts in Customer Experience Management

Shifts in Customer Experience Management

There are two things to note here. First, the number of components and simpler complexity of the architecture . By converting feedback management into the fourth pillar of CRM and taking some of the interactions between components as internal functions of SCRM the model has fewer “moving parts”. This is good from the point of view of implementing simpler solutions and initiatives for customer experience.

The second item to note is that Customer Experience Management has morphed into Social Customer Engagement. As customers discover how to converse with vendors better, and how to work directly within the “grid”, the term management is being replaced by the term engagement. In addition, we see more and more customers gravitate towards communities of one type or another – and while we continue to deal with customers one-on-one, we cannot ignore the influence they receive and the trust they place in it.

More on this shift in Customer Experience in future posts. Just wanted to introduce the concept.

Finally, an acknowledgment. As I was shopping these slides and concepts around I got to talk to Prem Kumar (@prem_k in the #scrm Twitter community). While exchanging ideas and concepts, he pointed me to his slideshare presentation on SCRM. He has a lot of the same concepts with more detail and more technically inclined. Unfortunately I had not see it before, or I would not have done the work I did.

I encourage you to take a look at his presentation (below) for a better idea of how SCRM will grow.

OK, I am done now. Let’s open the floodgates of criticism and praise.

What do you think? What did I miss? What didn’t i miss? Any way you would do it better or different? Please let me know. Leave me a comment and tell me what you think is needed to move this to the next level – or what are we going to continue to support as we move forward.

(**) This is a link to Gartner Research. You must be a client to access it, or you can pay for it if you think it is outstanding.

Esteban Kolsky
ThinkJar, LLC
Esteban Kolsky is the founder of CRM intelligence & strategy where he works with vendors to create go-to market strategies for Customer Service and CRM and with end-users leveraging his results-driven, dynamic Customer Experience Management methodology to earn and retain loyal customers. Previously he was a well-known Gartner analyst and created a strategic consulting practice at eVergance.


  1. Greetings Esteban

    Thank you for publishing your thoughts on social CRM. You’ve put a good deal of thought into it, and I believe that you’ve identified the major question for CRM practitioners, which is this: how can relevant unstructured data be identified, captured, interpreted and distributed throughout an organization so that engaging customer experiences can be delivered or co-produced that meet or exceed customer expectations, thereby promoting high levels of customer retention and enhancing business performance?

    Francis Buttle, PhD
    The Customer Champion


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