Why have I been reading lately that while customer centric behavior is increasing in companies, it’s still more of an inside-out process than outside-in? Having thought about it, I came to the conclusion that one of the reasons is because words matter.
Take the word “management,” as in “customer relationship management” (CRM) or “customer experience management” (CEM); it has meaning and connotations. Several dictionary definitions include “the organizing and controlling of the affairs of a business or a sector of a business,” “the act of handling or controlling something successfully,” and “the skillful handling or use of something such as resources.”
But word connotations are often subjective. For example, “management” connotes, to me, an activity done internally to an organization, something that someone volunteers to be subjected to, and, as one of the definitions suggests, something that is controlled, but in a “I’ve got the responsibility and you don’t” sort of way. The most important connotation I get, though, is that “management” is a set of passive (someone else does the action part) and short term (I manage a project to completion, I manage “putting out a fire,” etc.) activities.
Which brings me to the point of this editorial; CRM and CEM, tools used to help achieve customer centric goals, shouldn’t use the word “management” as part of their descriptions.
Why? Let’s start by looking at the word “relationship.” It means (dictionary) “the connection between two or more people or groups and their involvement with one another.” The connotations I apply are collaboration, work together, share, and have joint interests. In other words, you can’t manage a relationship without the cooperation of both parties who, basically, volunteer to enter into the activity.
Managing the “experience?” The company can manage the experience all it wants, but the customer can opt out at any time during the process. They control whether or not and how they participate in the experience. In essence, they’re doing the management, not the company. Again, both the company and the customer have to cooperate to make the “experience” – using the word I connote with it – positive.
Words matter. When it comes to “customer relationship” and “customer experience,” the word “management” sends the wrong message as to what work needs to be done in the short term and the long term. Furthermore, it implies an internal point of view, i.e. inside-out, biased by “we can control what ‘relationship’ and ‘experience’ we want to provide” and, potentially, leave out the most important reason CRM and CEM exist – the customer!
When “management” is paired with technology solutions, it can lull company individuals in thinking they’re successfully managing relationships and experiences by analyzing the data collected through transactions – which are business deals but not necessarily the “relationship” or the “experience” CRM and CEM have in mind.
Words matter and should be chosen to promote the goal and drive the activities described by them.
So what words would I choose? I favor active words like “building” and “growth.” Not only are they active and accurately describe the work that needs to be done, they also, in the context of a company, connote teamwork, collaboration and trust. “Growth” further connotes the need to take care of, change, and on-going activity. These are words that describe what I need to do to forge “relationships” and provide positive “experiences.” And, since “customer” is a descriptor word, it more than implies that the “raw” material, in the form of knowledge, has to come from the customer – some through transactions but most from collaboration.
Think about it: if you asked your customers “How would like me to manage our relationship?” would you get a different answer than if you asked them “Would you like to help me build and grow our relationship?” The second question is much more customer centric and would, probably, get “yes” as an answer.
What do you think? Do words matter? Are CRM and CEM management activities, as presently practiced, mature enough so “management” includes – promotes – the collaboration and trust needed to build good relationships?
Jonathan
I empathise with your difficulties with some business-speak words. But the word ‘management’ (of a relationship) covers much more than just ‘building and growing’ (a relationship). It also covers founding, maintaining, even closing down and restarting (a relationship). As such, management is a good catch-all for all these activities. Whilst less descriprive than building and growing, it is much more all encompassing and thus much more useful.
Using Occam’s Razor as a guiding principle, I prefer the simple word management.
Graham Hill
Independent CRM Consultant
Interim CRM Manager
Jonathan: I applaud that you question whether the words “Customer Relationship Management,” might be oxymorons. Many people, including myself, have bandied these words without taking a critical view.
Lately, like you, I have questioned why many companies build sales processes that have little relationship to how customers acquire information and buy–while gratuitously proclaiming their marketing and sales organizations as “customer centric.” The gap between sales processes and buying processes has become so large and widespread that my company has created a method for companies to examine and build the pathways to sales transactions by looking from the outside-in, not the other way around. In that process, companies identify resources (money, time, information, human capital) that must be deployed to provide effective value between vendor and consumer. Because these resources are finite for any organization, they must be controlled. From that point of view, I believe the word ‘management’ still fits.
The word “management” can mean a wide continuum from “loosely managed” to “tightly managed,” and neither end of the spectrum is mutually exclusive of customer centricity. Unfortunately, as you point out, many companies have simply paved over “Customer Relationship” on the way to “Customer Relationship Management,” because it’s easier to find managers who can control processes than to find those who can create valuable, sustained customer relationships.
Since nothing in business has ever been permanent or irrefutable (at least in my experience), your article points out that it’s always important to question the words we use in business and to look critically at the behaviors that ensue from those words. Thanks for initiating this provocative idea.
Johnathan, Andrew
I was thinking about how the emphasis of CRM and CEM look from the company and customer perspectives.
italics = weak emphasis, Normal = normal, BOLD = strong.
First CRM from the company’s perspective:
customer Relationship MANAGEMENT
Then from the Customer’s perspective:
Customer relationship MANAGEMENT
And CEM from the company’s perspective:
Customer Experience MANAGEMENT
Then from the Customer’s perspective:
customer Experience MANAGEMENT
What do you think?
Graham Hill
Independent CRM Consultant
Interim CRM Manager
I don’t think “management” is a bad word, whether in the context of CRM, CEM or whatever M. Management is what managers do, so tagging it on the end of something is fine by me.
The key questions are: managing what, and for who’s benefit?
When managers manage, they are trying to accomplish the goals of their organization. In some cases, by also helping customers accomplish their goals (customer-centric), in other cases, not.
Customers manage, too. Supply chain management is the term companies use when they work to get lower prices, higher quality and faster delivery from their suppliers. And all of us consumers are managing (although it’s rarely put that way) when we search online for product reviews, listen to a friend’s advice, or go window shopping.
But in the context of a real “relationship,” managing is a little strange, don’t you think? When people are in a relationship, they don’t think about “managing” each other just to accomplish their selfish goals. Instead, there’s give and take, respect, and a feeling that both should win.
This is a bit much to expect from most business to customer relationships, but worth aspiring to. I think businesses that want real relationships need to find customers that want the same thing, then spend less time managing and more effort collaborating for mutual benefit.
In the meantime, management lives on, because managers need something to do.
Bob Thompson, CustomerThink Corp.
Blog: Unconventional Wisdom
Don’t get me wrong; I believe “management” is an honorable endeavor having done it for many years myself. And Bob and Graham make persuasive arguments for including it in CRM and CEM. I do like Graham’s “perspective emphasis” chart. Sounds right and I believe that CustomerThink, and its gurus, are working to change the emphases outlined to reflect the work that needs to be done by management, but based on collaborative goals rather than the goals of one or the other.
For example, Graham recently wrote aboutflash mobs in a recent blog about what’s next; while I can understand the rationale behind the practice – and the management involved – it’s not even close to customer centric. The seller didn’t seem to cultivate relationship with customers – based on the sole fact that a large portion seemed to think they needed to take the action they did to get the value they wanted. Should the company have developed a strategy to deal with flash mobs – in other words, anticipate and manage this type of relationship? Good question?
But, more importantly, the customers haven’t really “managed” the potential outcome of their behavior. Sure, they have gotten a lower price but at what cost? Would the coerced company be able to stay in business at the “new” margins and for how long? Do the customers care? If not, do they expect another firm to take the “out of business” company’s spot? Why? Will they need the products services that are lost? Did the mob understand the goals of the company and how their goals would affect them? Just a few questions that popped into my mind.
I wrote this opinion piece to point out that “management,” as in CRM and CEM, is more complex than performing the “normal” management activities – developing strategies and tactics, managing budgets, hiring and managing people, making decisions, developing appropriate performance measures, develop feedback, communicating strategies and tactics to all appropriate enterprise entities, and participating in and overseeing initiative planning activities. Hard enough, right?
But customer centricity needs even more – collaboration, across the board integrated innovation and change management (these are everybody’s responsibilities, not just R&D’s and a CM group’s), alignment with and around customers, “customer focus” strategy development, business process management, and empowerment. As Andrew points out, the word “management” has a wide continuum. It also contains more things to do in that continuum in order to successfully build and maintain both relationships and experiences regardless of where companies and customers are in it. And it needs all the help it can get from all the relationship participants.
Jonathan Narducci
CornerStone Cubed
Building Customer Powered Value
I’d like to share some quotes on “words.”
“Words are not just words. They have moods, climates of their own. When a word settles inside you, it brings a different climate to your mind, a different approach, a different vision.” Osho
“Most of us make unconscious choices in the words that we use; we sleep-walk through the maze of possibilities available to us.” Tony Robbins
It is how we WANT to interpret the meaning of the word, and CHOOSE to ignore the true meaning of the word.
Daryl Choy, the founder of Touchpoint eXperience Management, helps firms make a difference at every touchpoint. Choy can be reached at wisdomboom.blogspot.com.
Jonathan:
Great question and you are dead on right. When words lose meaning, the ability of an organization to execute any program drastically decreases. I was actually going to write a blog on “what is a customer” for some of the same reasons you address.
On your point about relationship and experience – I often argue with some of my peers over the difference between “CRM” and “CEM”. As someone whose grown up in the ranks of sales, a “relationship” has a lot of meaning to me and I fundamentally reject the notion that Starbucks or Exxon have a relationship with me. I argue that the reason I go to Starbucks is for the experience (the taste, the environment, how quickly I can get served, etc). My friends counter by saying that if I am loyal, I have a relationship. So, there is one example of your point.
Another is this. “Customer Relationship Management”. Is it a wonder growth is so hard to achieve in most companies? Where is the mindshare devoted to prospective customers? We have an organizational model we share with our clients. We (my company) actually break down CRM into “acquisition” and “relationship”. The point being is that if you do an audit of most sales and marketing investments in a given company, too much of that investment is focused on existing customers and not enough on prospective ones.
I think there is a fine line between actually questioning meaning and arguing semantics. While your discussion over the true meaning of words is very health, I worry that some might get caught up around the axle over semantics and if that happens, the causal reader might confuse your very important points with just a jargon debate.
I nominate you as our conscious. I invite you to heavily scrutinize the word choice I make on my posts and call me out if you need to.
Good thinking. Please keep it up.
Scott Santucci
Scott, it’s interesting what happens when we take individual words, that each have complex meanings, and string them together into an even more complex idea.
Customer Relationship Management is the result. In addition to the marketing of those with vested interests in positioning the CRM term their way, the underlying words are not precise to begin with.
We all know what a customer is, right? I’ll bet 90% of companies don’t have a precise definition. Is a customer a company or an individual in the company? What about a customer that bought once 10 years ago, but never again? What about would-be customers, AKA “prospects” — aren’t they managed in some CRM applications?
Likewise “relationship” is like art. We know “art” when we see it, but everyone has a different point of view. Personally, I think experiences are a foundation to building a relationship, which means CEM should be part of CRM.
Bob Thompson, CustomerThink Corp.
Blog: Unconventional Wisdom
Bob –
Point one the customer – I completely 100% agree with you that the overwhelming majority of companies today do not have a standard definition of who their customers actually are, and thus – their efforts to be “customer centric” are rudderless. It’s hard enough to steer a battleship, let alone one without a rudder.
On your point about “relationship” – At a high level, I agree with you. Experiences over time form the basis of a relationship.
However, to me the question is this… should all companies seek to form “relationships” with their customers. Keep in mind, I know I have a bias, but – all the time I run into B2B companies who want to be “trusted advisors” to some CXO level position. However, in most cases, what they do doesn’t add value to a person of that level. So, they make huge investments to retool their sales forces trying to get the mindshare of an executive who cannot possibly find strategic value in what they do. A perfect example of this is a systems management company I worked with.
Like all of their peers, they have latched on to the concept on managing IT services like a business. Since “business” is used a lot, many in the organization think they should be trying to sell to business people. This is absurd. The only way that conversation would result in a sale is if they were able to help the business people realize their current IT organization is so bad, that switching providers is the only choice. Unfortunately, this vendor sells software (and not outsourcing services) which is implemented by the IT organization. So, there is no possible way that investments to pursue that targeted stakeholder will ever pan out. This is indicative of what I see all the time.
From my point of view, there are different “relationship levels” that you can shoot for. They fall on a continuum ranging from a “commodity provider” (the lowest form) all the way to “trusted advisor” (the highest form). Each level has strengths and weaknesses, but here is the key point.
YOU SHOULD ONLY CHOOSE THE RELATIONSHIP LEVEL AFTER YOU HAVE A COMPLETE UNDERSTANDING OF YOUR CUSTOMER.
Through this lens, I think that each interaction a B2B sales team has with its customers creates an “experience” and every time people use their product or service also creates an “experience”. However, as you move up the relationship continuum, the greater weigh is placed on people dealing with people.
In a B2C environment, I think the weight is far more on the experience side. I realize that Exxon might have to develop relationships with its franchise owners, but the bulk of their focus must be on the experience I have when I fill up my tank and buy a coffee in their stores. It wouldn’t be economically justifiable for them to try to build a relationship with me, and any effort to do so would seem insincere (aka “Dear Valued Customer” letters). This is why loyalty programs work so well for American Express and United, but you don’t see IBM providing “reward points” for their business customers (that would be silly).
I’d love to know your thoughts on this (and anyone else for that matter).
Scott Santucci
Relationships are not black or white, on or off. To your question…
[quote]However, to me the question is this… should all companies seek to form “relationships” with their customers. [/quote]
…I would say yes, but form an appropriate relationship–one that makes sense for the company and the customer.
Like you, I spent a lot of time in B2B sales, mostly at IBM. So, the word “relationship” has a more personal meaning to me, something between people. But, I don’t think that’s true of everyone. Some might say they have a “relationship” with the Apple brand, because they just love everything about the company and its products. And doesn’t it make sense to cultivate such raving fans if you can?
Perhaps the key is for marketing strategists to develop a spectrum of potential relationships, and then try to match these to the appropriate customers and situations. I have a fairly complicated relationship with my bank, but I don’t want a personal relationship with my ATM or online banking system for routine transactions. But in other cases, personal attention is critical.
This discussion supports my point that we can hardly expect to take three complex words (customer, relationship, and management) and then expect a simple definition and complete agreement on what “CRM” means.
Bob Thompson, CustomerThink Corp.
Blog: Unconventional Wisdom
Of course you are right about relationships not being on or off, but at some point you do cross a threshold where you don’t have a “relationship” any more.
I think I can accept your suggestion of “appropriate” relationship, on first reaction, it ‘feels’ right. I can see where you are coming from about people wanting to identify themselves with a brand. I want to trial it out on a few engagements to get “religion” on it, but it does pass the first blush test.
I completely agree with your point about those three words (customer, relationship, and management).
Perhaps there is a model or framework that we as a community can create that will lead us to more deep understanding. I agree with you about blowing up CRM and starting over. As an old sales person, you will recognize that old solutions selling concept “make like before you make different”. My interest in getting some more precision around “CRM” is so that we can contrast prevailing opinion against what a customer-centered organization really is. I think we might need a grid to settle this (on the top of my head)…
One axis for number of customers (Boeing as few, Coke a lot)
other axis complexity of solution (Jets are very complex, soft drink are no)
This might tell us a lot about what the appropriate relationship level is, and the medium to do it. (Few customers, highly complex – human based) (Many customers, not complex – mass communications). This might help us place web 2.0 too.
What do you think?
Scott Santucci