CRM, or customer relationship management, has become one of those must-have technologies that everyone's talking about. But the technology is, in the words of <i>M.A.S.H.</i>'s Colonel Sherman Potter, a real pain in the kiester to implement.
CRM, or customer relationship management, has become one of those must-have technologies that everyone's talking about. But the technology is, in the words of M.A.S.H.
's Colonel Sherman Potter, a real pain in the kiester to implement. Kiester pain No. 1: Customer data's locked up in back-end systems. Kiester pain No. 2: CRM requires cooperation from departments all across the organization. Kiester pain No. 3: Millions of dollars are being spent on CRM, but many companies haven't been able to determine their return on investment (ROI).
The business case for CRM is fairly straightforward. With the rise of e-business and the current crummy state of the economy, there's more pressure on companies to deliver goods and services at a faster rate. The insurance industry is a good illustration. Previously, when a new policy was opened, it sometimes took up to 10 days to underwrite a policy. Now, many agents and customersused to interacting with carriers online and in Internet timeexpect almost instantaneous policy processing.
In situations like this, it's time to get your host systems up to synch with Internet time, explains Jim Sinur, an analyst with Gartner Inc. With mounds of data and years of application development invested, back-end hosts are worth their weight in gold. Corporate decision-makers, however, may be questioning the long-term value of these unseen systems; to them, legacy systems often seem to hold up the works.
The worlds of host integration and CRM are converging, with interesting results. Integration with a Web front end is best accomplished by modeling the original application on a composite middleware platform and running transaction data through this environment, says Sinur. Companies are beginning to learn how to breathe new life into host systems and data to serve a new generation of applications. Because of faster time to market, the process may even result in a decent ROI for CRM.
The insurance industry may be seeing the first confluences between host integration technology and CRM processes. Glenn King, principal with ICICI Infotech, was part of a team that recently deployed an integration server to put the operations of a Massachusetts-based insurance company on a customer service center's intranet. The first implementations sought to speed up a seemingly mundane processcapturing customer address changes. However, this deceptively simple task consumed a large chunk of customer service representatives' (CSRs) time.
That's because the insurance company had three different mainframe-based legacy applications housing customer records. CSRs sometimes spent up to an hour finding appropriate data whenever a client requested an address change. This is typical of call center systems within the insurance industry, which are "stovepipes [that contain] separate systems for insurance, mutual funds and annuities," says King. ICICI installed WRQ's Verastream Host Integrator to create a single, consolidated model of the legacy applications that can be accessed by the call center representatives. Using Visual Basic, the team built an application that invoked the model, King says. Eventually, the teams modeled three legacy applications, with 10 screens, 58 data elements and 25 operations.
The company met its goal of faster data access and average CSR call time per customer shrunk to about five minutes, according to King. Skills development and better communication among various IT teams within the company was a side benefit. "We wanted the legacy and Java/Microsoft folks talking," says King.
Today's economy demands solutions that better leverage existing host systems, rather than creating new systems from scratch. Host integration tools, built on the Web-to-host heritage, enable more highly integrated approaches to initiatives like CRM. "Nobody has just one customer file or just one product file," Gartner's Sinur points out. Integration middleware links disparate applications and data at a single, manageable and more quickly accessible point of contact.
The stakes are significant, since a typical e-service Web site costs between $500,000 and $35 million to deploy, Sinur says, with an additional 40 percent a year in maintenance and support costs. About 34 percent of these costs go to middleware, legacy systems and front-end systems integration, he adds. The success of your e-business enterprise, then, may very well depend on your company's ability to quickly and effectively link to back-end systems.
Joseph McKendrick is an independent consultant and author, specializing in surveys, technology research, and white papers.