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Summary
For years Ventana Research has advocated that companies take steps to ensure they maximize the value of their most prized asset: their customers. Unfortunately our benchmark research shows that few companies have yet taken effective steps to put their customers first. Too many rely on traditional customer relationship management (CRM) as the solution, despite the fact that it has widely been found to be wanting. We believe CRM still has an important role to play in customer management, but it is not the panacea that users (and vendors) hoped it would be. Customer performance management is the management as an integrated whole of all customer-related activities to achieve desired business goals, and of which CRM is but one component. We believe that companies that embrace customer performance management and begin to implement systems to support it will ultimately be the most successful in acquiring and retaining customers.

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Customer performance management involves all business groups and activities that deal with customers, and it requires alignment of people, processes, information and technology involved with customers to the overall business objectives. Only when this occurs can an organization call itself “customer-centric.” We have identified five key components of customer performance management: customer information management, customer interaction management, customer relationship management, customer and call center business intelligence (BI) and analytics, and customer experience management.

Customer information management is concerned with creating a single source of customer data so that various groups within an organization can access customer information in forms appropriate to their processes and systems on the safe assumption that everyone across the organization using the data is drawing it from the same source. Ventana Research’s benchmark research shows that this is no easy task as companies can have as many as 20 different types of systems that contain customer data and can have multiple versions of the same type of system, and few are able to synchronize data between systems.

Customer interaction management involves managing all the different touch points at which an organization interacts with customers, as well as the resources required to handle those interactions. This means managing technology to handle telephone calls, e-mail, fax, Web-based transactions, instant messages and mobile text messages, as well as the workforces that handle interactions: call center agents and supervisors, knowledge workers located in other offices, field staff and home-based workers.

Customer relationship management is concerned with managing the internal marketing, sales and customer service functions such as enterprise marketing automation (EMA) and sales force automation (SFA). Although the processes within these functions eventually affect the customer, the majority are inwardly focused and so have little impact on the customer’s experience during an interaction.

Customer analytics and BI provide reports, dashboards, scorecards and analysis about customers and analysis of areas like the call center, which is the primary point of interaction with customers. Our benchmark research shows that collecting and supplying this information is the single biggest issue facing organizations as they try to become more customer-centric. Many diverse systems contain relevant data, and users need information in different forms appropriate for their roles.

Customer experience management is concerned with managing interaction as it happens. Its purview is the handling of customer calls, visits to the Web site and several forms of text-based interactions: e-mail, postal mail, fax, instant message dialogues and mobile text messages. Its primary goal is to ensure that every interaction is a positive experience for the customer and results in the desired business outcome. The technologies that have the most impact here are the agent’s desktop, Web-based self-service and customer feedback management.

Assessment
Ventana Research’s benchmark research show that despite all the talk about the importance of customers, few companies have taken real action to make them the center of the business. Most still operate as disconnected business units that focus on their own internal issues rather than the customer. Customer data remains spread across multiple unsynchronized systems. Companies use key performance indicators (KPIs) that are not focused on customers to drive performance, and most still rely on spreadsheets to produce those KPIs. The outcome is that most customers are dissatisfied with their interactions with companies.

Nevertheless, the talk about the importance of customers is right, and in today’s intensely competitive business environment, companies cannot continue to underserve them. Therefore, they must consider customer performance management. As companies start to take customer management seriously, they should realize that no single process or product will suddenly deliver more satisfied customers who remain loyal and buy more. Ventana Research asserts that companies that successfully implement processes and technologies and address people and information issues that span the five areas of customer management will be most successful in managing their performance to achieve the desired outcomes.