CRM, as a technology, is almost a quarter of a century old. Back when CRM was called "sales force automation"(SFA), the job of the sales professional was to carry information to the customer and bring back an order - both tasks that CRM and SFA supported admirably.
Since then, the basic nature of the business-to-business customer relationship has been changing rapidly. Today’s customers want to drive the relationship, according to Selling Power publisher Gerhard Gschwandtner. "What works today is what might be called ‘cocreation,’ in which sellers and buyers work together to find solutions," he explains. "To be successful in the future, you will need to get your customers involved in the creative process and convince them to become stakeholders in your company."
Unfortunately, CRM as currently defined provides little or no support for cocreation efforts. What’s needed, in addition to CRM, is an entirely new set of tools and an entirely new way of thinking about how sales teams should use technology.
THE COCREATION REVOLUTION
The Internet has utterly changed the way companies buy and sell. "A decade ago, sales reps were in the transportation business," explains Gschwandtner. "They traveled from place to place, carrying boxes of brochures and sales literature and giving informational presentations. Customers saw the sales rep as a valuable resource, because the rep knew and understood the products or services that the customers needed to fulfill their business objectives."
With the Internet, customers can now get product information without consulting a sales rep. More importantly, customers can get that information whenever and wherever they want it, a much more convenient arrangement than having to wait for a sales rep to deliver it by hand. As a result, the role of the sales rep has evolved toward consultative selling, in which the sales rep seeks to become a "trusted advisor."
But customers don’t just want an advisor, according to Patricia B. Seybold, author of Outside Innovation: How Your Customers Will Co-Design Your Company’s Future (Collins, 2006). "Your customers now want and expect to play a major role in defining the evolution of your company," she explains. "They want to see their ideas reflected in your products, they want you to adapt your selling to their way of buying, and they want you to, similarly, take responsibility for key elements of their business."
There are payoffs for both buyer and seller alike in the cocreation model. It not only allows sales professionals to engage high-level customer execs from multiple lines of business and functions, but it also allows customers similar access to the seller’s executive and technical team. The end result is a closer relationship and, ultimately, a larger number of financial transactions. "Your executives gain insights and stories from working with groups of customers to brainstorm better ways to help those customers reach their goals, and these insights spawn strategic conversations around customer-impacting issues and business opportunities," explains Seybold.
WHY CRM IS NO LONGER IN SYNC
Despite the implicit promise that CRM is intended to manage customer relationships, CRM is not playing a primary role in cocreation efforts, according to Seybold. "The action primarily takes place on the Internet using other kinds of technology," she explains. "Vendors get customers and prospects involved in codesign efforts, thereby creating a broad base from which to draw collective market wisdom and, in some cases, actually setting the strategic direction and marketing plans for an entire corporate division."
CRM is out of sync with these activities because it tends to be a vendor-focused technology, as opposed to a customer-focused technology, according to Michael Bosworth, coauthor of CustomerCentric Selling (McGraw-Hill, 2003). He’s repeatedly criticized CRM for discouraging customer-focused behavior, which would presumably include the cocreation activities. As Bosworth sees it, CRM...
- puts the emphasis on internal processes and automating the way companies would like to sell, rather than the way customers would like to buy;
- injects unnecessary technology into the work environment, creating additional complexity that focuses sales reps away from selling and toward the care and feeding of the CRM system;
- forces sales reps to ignore or subvert the CRM system in order to meet customer needs, thereby creating confusion and draining sales productivity.
Gschwandtner agrees, saying, "CRM is an internal ecosystem that allows salespeople to track customers and sales managers to track salespeople. But we’ve now shifted to a (continued on page 2)