Focus on Organizational Structure

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Carol Smalley
Managing Editor, CRMGuru
Member

Posted 11-Mar-2003 08:35 AM
[Keith Voss asks:] I am looking for some case studies/examples of how companies set up their organizational structures to support CRM strategy. I’ve heard some companies form a CCO (Customer Care Officer) position, while with others the function resides in a central marketing function. We do not have a central marketing function. Each of our four businesses has its own customers, data, sales and marketing teams. Any examples or writings on this subject would be appreciated.

[Guru panelist Bill Brendler responds:] I think the key is looking at how customers get their problems solved. In many companies, the business units designed to serve customers rarely interact whether they’re serving the same customers or not. This is a big disadvantage because of the missed learning and potential cross-selling possibilities. If this is done poorly, it could mean lost customers.

Even though you say—”Each of our four businesses has its own customers, data, sales and marketing teams”—they cannot continue to function in a vacuum. Why is it you need four different departments?

No matter what your answer is to this question, I strongly believe that companies must reward cross-functional communication no matter how they’re organized. Some assign customer accounts to teams from various areas where contact with customers is paramount—for example, product design, marketing, sales and accounts receivable. A single company contact might have the responsibility for all inquiries regarding credit, billing, collection and even order fulfillment.

Eliminating the layers of bureaucracy between customers and those employees best equipped to solve their problems is the first step in the sub-process of building cross-functional cooperation.

World-class companies have discovered that the best way to streamline customer contact is to provide cross-functional training so that employees understand the entire customer cycle in all cases. So, if you’re thinking of organizing, I would not put another management level in (CCO). One thing that would ensure cross-functional cooperation happens is to have these teams report to the top—the COO or CEO. By doing this, you put your commitment to retain customers at the top of the list.

Bill Brendler
http://www.brendler.com


Carol Smalley
Managing Editor, CRMGuru
Member

Posted 17-Mar-2003 07:35 AM
NOTE: Posted by Editor Carol Smalley on behalf of Dominique Foucart[[email protected]] during discussion forum test phase.

We just reorganised our company in order to better focus it on its customers.

Our former organization was fairly classical with Marketing, Sales B2C, Sales B2B, R&D, IT, Customer Support & Services as main operating entities. What we did is to creat 3 groups of activities: “Technical Customer Solutions” (Product Marketing, R&D, IT development), “Customer Services Operations” (Customer Support & Services, Technical Operations, IT Operations), leaving aside the pure Distribution Network Management, Corporate Sales and Market Marketing activities.

The expected benefit lies mainly in the complete integration of the Customer Support & Services activities with the Production Chain; this requires a complete redesign of the processes, since the reorganization also includes a new definition of the Customer that prevent any usage of the former “internal customer” logic. All business processes are currently reviewed from the perspective of the Customer. As an example, in the former organization, trouble management was scattered between the Customer Assistance Desk and the Technical Operations, leading to up to 5 versions of the same “trouble ticket”, depending of who was handling it (Customer Hotline, Operations Control, Technical Back-Office, IT 3rd level or R&D 3rd level. In the new organization, we can ensure that a Customer Problem will be visible and followed up through one single line of action.

Whether this will work or not is still unknown, but we are convinced this is a clear step toward a more Customer Centric organization.

Dominique Foucart
Head of C/PRM Business Domain
http://www.mobistar.be


Graham Hill
Guru
Member

Posted 24-Mar-2003 02:08 AM
Although some organizations need radical surgery to get closer to customers, not all do. And you don’t need to start everything with an organization reengineering project that would have a high probability of failure if the whole business wasn’t reengineered at the same time. You can start by getting the marketing, sales and service people to talk to each other more frequently. This could be through encouraging individual staff to leverage their own personal networks to share information with ‘official’ support. If that works well, you can develop cross-functional work teams across the divisions to move things to the next step. The key thing is sharing information to the right people in a timely manner and starting to develop a collaboration mind-set. Research has shown that just sharing information alone doesn’t provide any business advantages in the long-run. That only occurs when groups start to collaborate together to develop a way forward that meets the organisation’s goals. There are a number of further organizational development steps that you can take that are set out in Jay Galbraith’s excellent book on Redesigning Multinational Corporations.

Graham Hill
Independent CRM Consultant


benish mahmood
June 30, 2007
where do i place CRM in the organizational structure

The company i am working i am formulating this strategy for is currently working on a line structure with all the departments including sales, supply chain, marketing, finance and all the brand managers for differnt divisions reporting to the CEO. i feel they need to incorporate a CRM system but do not know where to place it in the organizatinal structure. Should it be a subet of the marketing diviaion or should it be a seperate division also reporting to the CEO, or should it form a matrix structure in line with other divisions while also leaving room for each division to seperately report to the CEO.


Jay Cirry
July 2, 2007
Why not make a “Customer

Why not make a “Customer Division” and put all custopmer care/service/marketing and sales functions in that Division?
/


John Holland
July 2, 2007
CRM Structure

The different areas you are trying to coordinate are Marketing, Brand Managers, Sales, Supply Chain, Finance and the CEO. Sellers’ interpretations of the outcomes of sales calls is the input to a CRM system. The sales forecast (after massaging?) is the input to Supply Chain to support the volume of business anticipated. Falling short of a sales forecast hurts in three ways: Top line revenue is lower than anticipated, Supply Chain expenses are higher and therefore earnings suffer.

A top-down structure (with senior executive commitment) for each division might give the best chance for successful implementation. The interdependence of these groups can be viewed in the following manner:

Marketing/Brand Managers should be supporting Sales
Sales’ forecasts affect Supply Chain orders for material
Sales’ forecasts affect the CFO’s earnings projections (top line, but also expense as relates to Supply Chain expenditures)
The CFO’s earnings projections become the CEO’s message to investors


bruce_culbert
July 2, 2007
Bruce Culbert It sounds as

Bruce Culbert

It sounds as if this is a new idea for the company and if I read between the lines correctly the department structures are pretty well set. If the goal is to get everyone in the company on the same page in delivering an optimal and profitable customer experience regardless of role then the effort will require the visability and support at the CEO level. That does not mean I’d recommend a seperate organization structure however. Most organizations can not afford a seperate structure that could potentially increase overhead and create yet another silo operation. The best bet is to have a small but strong “project office” responsible for the overall strategy as well as mesuring and monitoring the progress of the initiaitives commited to across the organization. This project office would hold senior status, be staffed by the most approriate executives and report to the CEO. Each department would have representation in the “project office” so that all areas are fairly represented and understood and that their is buy in from the department heads. Then each department will be responsible for implementation of the strategy, tactics, process, people and technology, etc… in a coordinated effort as it relates to their role in the overall business/customer strategy for the company. If this company is a midsize to larger enterprise then this hybrid approach seems to work best for gaining necessary focus and commitment with propper buy-in from the departmental level.


Jeanne Bliss
July 5, 2007
Customer Leadership – Organization Question

Okay, here we go.

This is the tough question – which is the window to commitment inside your organization for customers. However, let me caveat this by saying that there is not one “right” solution here – it depends on your organization, the people in it, and the maturity of your organization in its ability to focus on customers and integrate cross-company work into the DNA of your business.

The actual goal (in my opinion) is that over time, someone like a CCO or customer leader actually works their way out of a job over time as the company becomes adept at working together on across-company solutions to customer experience challenges.

That said, here’s some food for thought…based on having the key customer job and reporting to CEOs most of my career in that capacity.

Option 1: Report to the CEO

Yes, this is the best option…usually. If your CEO is clear and has the band width to meet with the customer leader and has the stamina and passion to drive a new kind of accountability and be involved in changing the metrics of the business – best place in the world to be. However, if you are in a complex business with multiple vertical businesses, there may be a better place to position the customer work initially. I say this because the name of the game initially is about getting traction…

Option 2: Find the zealots – report there.

Especially in companies that are large and have strong vertical operations with basically a CEO running each – this is ideal. It is likely that one of those operations is run by a zealot who is personally passionate about customer experience and the impact a diffferentiated experience will have on company profits. They will put in the time, make the changes, and go through the pain and provide a customer role with the personal air cover to make the changes in the buinsess. In one company, it was the leader of small business, in a software company, it was the leader of one line of business. If you don’t have the CEO helping and supporting the cross-company traction, then find a smaller version of the world and practice and hone the cross-company concepts here. Get some wins, prove the dollar pay-out then make the case to report up higher. This works.

Option 3: A tag team with the CFO and CEO and Marketing or Operations.

Getting the CFO involved early as a leadership advocate and supporter is critical. This is because you need to make the conversation of the business to be about managing customers as the asset of your business. Create a leadership consortium with the CFO and CEO and one other strong leader who advocates, pushes and helps to gain traction. This way the CEO is involved, but has an operations person involved where the ideas can be practically implemented. Because what you must do is to take the work from conceptual to practical implementation as soon as possible. But consider this – if you are layering the work on marketing or another operating area – do it only after there is strong conversation about how the customer work involved additional skills and expertise than what classically exists within these vertical disciplines. Marketing classically doesn’t consider its work to be as broad as including process management, change, organizational alignment and accountability, for example. But this is the new work that will be layered on if the chief executive advocoate resides in marketing. Make sure that this is laid out, and that you are sure there is an appetite for this additional work before you push the “start” button.

Hope this helps. Safe travels in your journey.

Jeanne


Michael Lowenstein
July 9, 2007
CRM in the Organizational Structure

To my way of thinking, this should be organized under a Chief Customer Officer, reporting directly to the senior corporate exec. This function is responsible for customer profiling, with inside and outside (demographic/psychographic/firmographic) data, plus customer support and marketing research. There is a great deal of rationale, and practical organizational structuring and culture management, for this. Jeanne Bliss has nicely defined how this should be done in her investigations and writing.


Benish
July 14, 2007
Thank you all for your

Thank you all for your input. I really appreciate it and this helped me alot. Thanks again all!


Alan J. Zell
January 21, 2008
Changing the organizational chart

Some 10 or 12 years ago, I heard John Nortstrom talk about the organizational chart they used and it struck me that it was so logical that using it would change other businesses’ outlook on how they looked at customers. His format would make it easy to see just where CRM fits in.

In the usual organizational chart called a “Pyramid Form”, the top management is at the top of the triangle and all the other positions, departments, etc. are somewhere between the top and the baseling. Oh, but find, if you can, the job of “customer” on the chart. Can you?

Well, Mr. Norstrom held up a triange, the point on the bottom. At the point were the names of the Nordstroms. At the very top was the word “CUSTOMER” and just underneath that was “Salesperson.” He then had 4 vertical divisions — Management, Finance, Operations, Sales Support. He held the triangle by the top and said, and I believe this quote was right, “The customers hold us up.” He also said that the 4 divisions have to be balanced because if any one gets too large, since the organization chart sits on a point, things will fall over and spill out.

So, my challenge to you is to take your current organization chart of the wall, turn it topsy-turvy, put “CUSTOMER” at the very top and it will become evident where CRM fits in. Oh yes, that all the other jobs are standing on their head, when they change themselves to upright, the culture of the business will change.

If any of you would like a pdf file of the chart, please let me know and I’ll be happy to forwward it to you.

Alan
Alan J. Zell, Ambassador Of Selling, Attitudes for Selling
[email protected] www.sellingselling.com
Awarded the 1992 Murray Award for Marketing Excellence
Member, PNW Sales & Marketing Group
Member, Institute of Management Consultants
Member, International Speakers Network


Salim Ahmed
March 21, 2011
Client Relations

I am working as a client relations Executive and would like to change the name of my section to something more modernized and more meaningful as we not only manager customer service but also do many things beyond.

Appreciate your assistance on the subject

Sincerely
Salim

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