Developing a CRM Strategy in Your Firm: Size Up Clients to Build a Competitive Advantage

Abstract

EXECUTIVE SUMMARY * When a customer relationship management (CRM) strategy is integrated with a firm's overall strategic plan, it helps the firm perceive and respond to business and economic trends. * CRM strategy starts with an understanding of a firm's clients that is derived by collecting client data and converting data to usable intelligence about your clients, their industries and the markets you have the potential to serve. * A successful CRM strategy requires a supportive organizational infrastructure, a client-centric culture and formalized business processes. CRM implementation must be marketed internally to ensure that all functional personnel use and regularly update client information. * The CRM strategy supports the overall business objective by building and leveraging client relationships for a sustained competitive advantage. * A CRM initiative that is supported from the top and has implementation champions with power in the trenches will result in improved revenue and profitability and move your firm toward its strategic vision. ********** CPA firms are witnessing firm-changing trends like consolidation, globalization and outsourcing, staff shortages, and the explosion of niche practices that are contributing to the need for effective customer relationship management (CRM) systems. CRM is not simply a software application for tracking client data and activities. It is a strategic tool firms can use to leverage proprietary information to identify cross-selling opportunities, new prospects, and potential conflicts of interest or independence issues. By developing a deeper understanding of your clients--their industries, markets and relationships--through CRM, your firm can gain a sustainable competitive advantage in challenging times. [ILLUSTRATION OMITTED] This article explains how a successful CRM approach builds on a strategic vision that integrates people and processes with technology to maximize a firm's investment. When companies design their business processes to accomplish their strategic goals, and identify how and where CRM technology will be used to add value to the practice, employee buy-in is more likely and CRM is viewed as more than just another administrative task or software application. WHAT IS CRM? CRM gained recognition in the mid-1990s as an information technology tool used to collect and share client information. However, success in implementing CRM seemed to elude companies that employed it solely for those purposes. According to many CRM researchers, the main reason companies failed to implement CRM was their inability to develop and effectively implement a strategy for relating to clients. A CRM initiative must provide a firm with the decision-support tools needed to be strategic--whether in identifying new clients, more profitable existing clients, or new services. Strategic CRM looks at what client information means and how it can be useful for developing a better business. It requires a customer-focused culture that promotes customer satisfaction, the sharing of customer information and its conversion into useful knowledge. [ILLUSTRATION OMITTED] CRM Is STRATEGY, NOT JUST DATA A key goal of CRM is to develop a view of the client from all angles or areas of the company. This means continually learning about your clients. Data obtained from each client interaction must be electronically stored so it can be shared among employees within your firm. This can be a challenge when there are high numbers of clients or industries, the business is seasonal, and/or many employees access the same records. Before considering CRM technology, accounting firms should identify the client information they need and how it will be used to manage customer-related activities. The simplest form of client data is contact data. This includes full names and addresses, as well as each person's position and role in the decision-making process within the client's business, such as buyer, influencer, approver or gatekeeper. …