Guidelines and Resources: Customer Relationship Management

Sections of this topic

    Customer Relationship Management: Guidelines and Resources

    © Copyright Carter
    McNamara, MBA, PhD, Authenticity Consulting, LLC

    Although there is a conventional difference between the terms “customer”
    and “client,” this topic refers to “customers” as meaning
    both. Also, although a product is a tangible offering and a service is an intangible
    offering, this topic often refers to “products” as meaning both. The
    activities of customer relationship management apply to any type and size of
    organization, so the term “organization” refers to that wide variety,
    as well. Before reading this topic, you might read about the Relationship
    Between Managing Supply Chain, Operations, Quality, Customer Relationships and
    Customer Service

    Sections of This Topic Include


    Suggested Pre-Reading
    You Are Probably Doing Some CRM Now, But …
    What is a CRM System?
    What Are the Main Benefits of a CRM?
    Types of CRM Functions
    Types of CRM Systems

    Planning Your CRM System

    1. Clarify Organizational Goals and Measures
    2. Align CRM Goals With Organizational Goals
    3. Clarify How Customers Will Be Treated Differently
    4. Decide What Organizational Design Changes Are
    5. Select the Best CRM Software

    Developing Your CRM System

    Redesign Your Organization As Needed for CRM
    Start Cultivating a CRM Culture
    Delegate CRM Goals to Teams and Employees
    Train Employees About CRM

    Managing Your CRM System

    Manage Your CRM Teams and Employees
    Manage Your CRM Software
    Evaluate Your CRM System

    General Resources


    Also consider
    Service Management
    Quality Management
    Chain Management

    Related Library Topics


    Suggested Pre-Reading

    Customer Relationship Management (CRM) ensures that the ongoing relationship
    between your organization and its customers is always very valuable to everyone
    involved. That was easier to do in the past when an organization was expected
    to provide a product or service, and the rest was up to the customer.

    That has changed dramatically. Today, customers can instantly access opinions
    about your organization and its products. Also, they can instantly order products
    and services from anyone else around the world.

    So before reading the following guidelines and resources in this topic about
    CRM, it would be very useful for you to first get some understanding of the
    proactive, systematic, high-quality process required to ensure ongoing, great
    customer service today.
    All About Customer
    Service: Overview and Numerous Resources

    You Are Probably Doing Some CRM Now, But …

    If you work in an organization, then you are probably already involved in some
    form of CRM now. This is true whether your organization serves customers who
    are internal or external to your organization, or both.

    What do you do now to ensure a great ongoing relationships with your various
    customers? For example, how do you keep track of information about them? Highlights
    from your conversations? Their feedback about your services? Your plans about
    serving them into the future? Schedules of when to contact them and what to

    For example, do you have a central database that organizes that information?
    Do you use spreadsheets with customer information? Do you resort to using the
    contacts list in your phones? Are there multiple people involved in serving
    customers? If so, then how do you all ensure you are effectively sharing the
    right information at the right times? How are you reminded of when to contact
    certain customers and for what purpose?

    The answers to those kinds of questions comprise some of your activities in
    CRM. CRMs can be implemented and utilized in a rather informal, sporadic and
    reactive approach. Or, they can be implemented in a proactively planned and
    highly integrated approach. If your organization plans to grow and develop to
    the next life
    , then you are far better off to use the latter approach. Fortunately,
    there are many highly practical and affordable guidelines and tools that can
    help you.

    What is a CRM System?

    A system is a recurring cycle of activities, including:

    1. Planning to determine goals and how they can be achieved, and
    2. Then developing and managing resources and activities to achieve those goals,
    3. Then evaluating whether the goals have been achieved or not, and
    4. Then using the learning from the evaluation to improve the quality of the
      next round of planning.

    Thus, a system is a recurring loop of components — in a continuous cycle of
    improvement. Customer relationship management is best done as a system; otherwise,
    the management tends to be highly reactive and sporadic, often resulting in
    a patchwork of disconnected and ineffective activities.

    The purpose of a CRM system is to take a recurring, comprehensive and systematic
    approach to ensuring a mutually fulfilling relationship between your organization
    and all of its customers. The system works with any type and size of organization
    that has customers, whether internal, external or both. Here are two additional

    • “Customer relationship management (CRM) is the combination of practices,
      strategies and technologies that companies use to manage and analyze customer
      interactions and data throughout the customer lifecycle, with the goal of
      improving customer service relationships and assisting in customer retention
      and driving sales growth.” SearchCustomerExperience
    • “Customer Relationship Management (CRM) in a very broad way can be
      defined as the efforts made towards creating, developing, and maintaining
      a healthy and long-lasting relationship with the customers using technology.”
    • “CRM is an organizational strategy, not a software tool — although
      software can be used to help the CRM system to work toward its purpose.”
      Carter McNamara

    The CRM guides and supports customers through the various phases of the customer
    relationship phases, as well as the phases in the sales pipeline.
    The Three
    Phases of CRM

    Customer Relationship Stages for Full Engagement

    What Are the Main Benefits of a CRM?

    The more you understand your customers — their types
    and needs,
    what they value,
    their activities with your organization — then the more likely they will remain
    loyal to your organization. Here is a list of some of the overall benefits of
    a CRM system:

    • You can easily access comprehensive and integrated customer-related information
      in one place, rather than sorting through a variety of different channels
      and people.
    • It improves customer communications because you know how they prefer to
      communicate, the most recent status of communications with them, and what
      their current priorities are.
    • It increases efficiencies and team work in operations, helping organizations
      to evolve through the necessary organizational life cycles.
    • Overall, you can increase customer satisfaction, loyalty and retention —
      ultimately, increasing profits for businesses and community impact for nonprofits.

    If yours is a small or medium-sized organization, then you might be mistakenly
    thinking that a CRM system is much too complex and expensive for your organization.
    If so, then you might benefit from reading this article.
    Five Myths About CRM Debunked

    Types of CRM Functions

    The CRM system works by pulling together information about your customers from
    a variety of different sources that you specify in order to automate:

    • Marketing, for example, organizing information about each
      different group of customers, and then tailoring sales and marketing campaigns
      to each (see Marketing)
    • Sales, for example, analyzing information about each customer
      to help them to evolve through the sales pipeline, as well as using CRM for
      account and contract management (see Sales)
    • Customer service, for example, recognizing your different
      types of customers, the needs of each and what they value, as well as noticing
      their complaints and what has worked to resolve them (see Customer
    • Analytics, for example, generating forecasts of likely
      demands for certain types of goods and services, as well as what might be
      the best pricing structures for them (see Business
      Data Analysis
    • Collaboration, for example, sharing calendars and project
      plans, as well as coordinating common communications across different stakeholders
      (see Team Building)

    By automating these functions with CRM software, you can organize information
    from your documents, notes, phone calls, emails, chats and forums. You can program
    some CRM software to monitor certain social media tools to notice comments regarding
    your organization and its products and services.

    Thus, CRM systems can give you a clear picture of each of your customers to
    help you cultivate a strong relationship with each as you support them through
    the customer
    life cycle

    Types of CRM Systems

    When considering which type of CRM system might be best for your organization,
    it helps to consider from among three main types including the following. You
    will notice that they correspond closely to the above-mentioned types of CRM

    1. Operational – This type focuses especially on activities
      in sales, marketing and customer service. It also organizes information about
      customers, including each individual customer, as well as different groups
      of customers. It is the most popular type.
    2. Analytic – This type analyzes information to suggest, for
      example, buying patterns of each group of customers as well as their spending
      patterns and timing to convert leads to contracts.
    3. Collaborative – This type coordinates the sharing of up-to-date
      information among different key personnel and teams, as well as among different
      groups of stakeholders, including, for example, suppliers, distributors and

    Analytical, Collaborative
    An Introduction
    to Different Types of CRM Systems
    is CRM? 3 Types of Customer Relationship Management



    Understand Problems and Pitfalls to Avoid
    in Implementation

    Now, before you plan and implement your CRM system, is the best time to consider
    the types of problems that can occur — not later on when you are in the middle
    of trying to operate the system, while also trying to resolve problems in how
    it is operating.
    Why CRM Fails
    Top 5 CRM
    Software Pitfalls
    Avoid the
    Four Perils of CRM
    CRM Projects Fail & How To Avoid These Pitfalls
    10 CRM Implementation Pitfalls

    Form a CRM Team

    The planning and implementation of a CRM system requires sufficient time, energy
    and expertise, as well as a variety of different perspectives. That means a
    well-qualified and designed CRM Team of the most suitable members from your organization.
    The CRM Team would make recommendations to management about, for example:

    • Goals for the CRM
    • Metrics to measure progress toward the goals
    • The best approaches to train employees about CRM
    • Criteria to select the best CRM system
    • The best CRM system that meets the criteria

    It is best to draft a job description for the CRM Team to be used when explaining
    the CRM Team’s role to upper management and suggesting who should be on it.
    The description also gives guidance and direction to the CRM Team as it is doing
    its job.

    It is often best, as well, to train the members of the CRM Team about CRM. It might
    be useful to hire an expert to do that training, as well as to being a resource
    to the CRM Team as it does its job.
    to Build the Perfect CRM Implementation Team
    To Structure Your CRM Implementation Team
    5 Important People
    You Absolutely Need for CRM Success

    Also see

    Performance Management

    Understand the CRM Planning

    Here are some excellent articles that can give you and your CRM Team a good impression
    of what is generally involved in planning and developing your CRM system. You
    might read them in this order from general to more specific:
    4 CRM Implementation Considerations
    How to Complete
    a CRM Implementation in 5 Steps
    to Create a CRM Strategy in 7 Steps

    1. Clarify Organizational Goals and

    What are the organization’s overall goals regarding its sales, customers and
    service? For example, are they to increase sales revenue, expand marketshare,
    increase customer retention and/or reduce customer complaints? What is your
    value proposition
    to sell your products and services to different groups
    of customers? What is your unique
    selling proposition
    that separates you from your customers?
    Strategic Planning
    How to Do to Planning
    and Objectives Should Be SMARTER

    2. Align CRM Goals With Organizational Organizational

    Define the CRM goals needed to help achieve the strategic goals. For example,
    should you focus more efforts on various preferred groups of customers, such
    as the most profitable customers, new customers, current customers and/or reducing
    their complaints? As much as possible, associate the necessary SMART
    objectives needed to implement each CRM goal. It is helpful to articulate a
    fictional customer profile, or persona,
    to most easily consider the nature of each group of customers.

    When deciding CRM goals, it is often useful to consider various metrics, or
    measures of progress, for a CRM system. The metrics themselves can become goals
    to achieve.
    CRM Metrics: How to Measure the Performance of CRM
    to Measure CRM Success
    Metrics: What Should You Monitor and Measure?

    Also see
    Planning and Operational Planning

    Action Plans & Alignment

    3.Clarify How Customers Will Be
    Treated Differently

    How can you best evolve each preferred group through the sales pipeline, while
    maintaining strong customer relationships and services? For example, should
    you sell directly to them or use a distributor? For each group, should you start
    or enhance a call center, up-sell or cross-sell, focus on certain types of discounts
    and/or improve quality management? Also, what are the most appropriate communications
    channels for each preferred group?
    All About Sales
    How to Work With Others

    4. Decide What Organizational
    Design Changes Are Needed?

    A conventional rule in deciding the structure of something is “form follows
    function.” In other words, the structure of the organization (its design
    and roles) should be to what is most useful in implementing the organization’s
    functions (its goals and methods to achieve those goals).

    So what departments, teams and employees are now — and should be — involved
    in dealing with customers, for examples, sales, marketing and customer service?
    What roles are now — and should be — involved in using the CRM system, including
    its software? What goals should each department, team and various employees
    have in customer relationship management? What SMART objectives should be associated
    with each goal?
    Structures and Design
    for Successful Organizational Change

    5. Select the Best CRM Software

    What Type of Software Platform is Best?


    In this type, you install the CRM software on your computer system, as well
    as maintaining, troubleshooting and updating the software. You would either
    use one of the free CRM tools (listed later on below) or buy or license a tool
    from a vendor.

    This type of software installation works best if you have available ongoing
    technical skills for installation, troubleshooting and upgrades. You also will
    need considerably more time to install the software as you climb the often steep
    learning curve to understand the software and its installation. You are likely
    to face occasional periods of downtime of the software as problems are solved
    and upgrades are installed.


    In this type, you subscribe or license the software from a vendor that makes
    the software available to one or more people in your organization, depending
    on the licensing agreement. The vendor manages all aspects of the software,
    including installation, testing, training, troubleshooting and upgrades. This
    works if you have a suitable budget. Fortunately, the price of CRM software
    has continued to decrease over the years.

    How to Select the Right CRM Software

    Questions to Consider When Specifying Your Software Requirements

    lists a variety of questions to consider, including:

    1. Is it suitable for your size of organization?
    2. Are there any limitations to the number of users?
    3. Is it easy to use?
    4. Can it be integrated with your other computer systems?
    5. Is it easy to integrate with other customer service solutions that you already
    6. What are its security features against hackers’ attacks?
    7. Is the software affordable and fits in your budget?

    You should also consider:

    1. What type of CRM software do you need? (See Types of CRM
    2. What type of technical support does the vendor provide? How reliable is
    3. Does the vendor provide training?
    4. Does the vendor include a careful manual for implementing the software?
    5. Does the vendor provide demonstrations that your employees can experience?
    6. What are some of its customers saying about the software?

    Specify the Requirements for the Software

    Now you are ready to specify what you want the CRM software to accomplish for
    you. It is best to write a software requirements specification (SRS), while
    focusing now on the needs of your organization, and not on the particular software
    tool that you might already prefer. Later on, you will take your SRS to the
    various CRM software vendors for you to carefully decide if their software will
    indeed meet your organization’s needs.
    to Create an SRS for CRM
    CRM Software
    Requirements for Your Business
    to Define Your CRM Software Requirements

    Requirements Example Document
    Levels of CRM Requirements
    Your CRM Requirements

    Lists of Some CRM Software and Costs to Consider

    Free CRM Software

    7 Best Free and
    Open Source CRM Software Options
    Can You Use Gmail as CRM Tool?
    The Free CRM With Something
    for Everyone
    Best Free CRM Software
    for Business in 2019
    Free CRM for Small Business

    Fee-Based Software

    CRM Software
    Best CRM Software
    2019: Comparison & Reviews
    The 25 Best CRM Apps
    for Every Business
    CRM Tools
    Relationship Management Software

    For Small Organizations

    “Most of the businesses out there will choose a CRM software to measure
    the performance of their strategy. The good news in selecting a CRM Software,
    is most of the complexity has been taken out of the process now. The best CRM
    software solutions include SaaS (software as a service delivered online), and
    innovations in this area improve everyday. This means there is no longer a costly
    need of an in-house IT team and server space. At least this will be the case
    for 97% of all businesses with less than 10 employees.” Thinkaboutcrm

    For Nonprofits

    Nonprofits can also use CRM software, for example, for tracking clients, program
    outcomes, funders, results of fundraising, volunteers, memberships and their
    membership levels.
    How to
    Choose the Best CRM for Your Nonprofit
    Awesome Nonprofit CRM Options for Your Organization
    Nonprofit CRM Software

    Now Select the Best Software For Your Needs

    You are in a great position now to begin working with various vendors to get
    the best software to meet your needs, as specified in your SRS. You might include
    your specification in an overall Request for Proposal (RFP). You also might
    bring the members of your Implementation Team with you when talking to the vendors.
    Definitive CRM Selection Guide and Checklist
    to Choose Customer Relationship Management (CRM) Software
    CRM Software
    Tips for Choosing the Right CRM Software
    Step-By-Step Guide To Selecting The Right CRM Software
    Vendor Evaluation Matrix
    CRM Evaluation Checklist: What Should You Look For?
    CRM RFP Guide and Template for Creating the Perfect Proposal

    Also see
    Reasons Business Contracts Fall Apart
    Business Contracts


    Redesign Your Organization As Needed
    for CRM

    Consider the goals and objectives that you established during the CRM planning
    for each department, team and employee associated with customer relationship
    management. What teams and roles should exist? How should they be integrated
    with each other? For example, which departments, teams and employees should
    be collaborating with each other and how? What organizational design would best
    facilitate that type of involvement and collaboration?
    Understanding Organizational
    Structures and Design
    Design and Job Design

    or Reorganizing an Organization and Its Employees
    How to Know What
    Positions and Jobs Are Needed

    Start Cultivating a CRM Culture

    Research shows that long-lasting, successful change in an organization usually
    requires a change in its culture. Unless the culture begins to change, it does
    not matter how much advice and many tools that the organization gets. A change
    in culture will determine whether they are actually used or not.

    Great customer relationship management is a mindset. It is a way of thinking,
    prioritizing and planning about customer relations in an organization. It guides
    how decisions are made and how problems are solved regarding customer relations.
    When many people in an organization have that mindset, then the organization
    has a CRM culture.
    Culture – How to Bring CRM Culture Successfully?
    Steps to Implementing a CRM Culture in the Organization
    a CRM Culture

    Also see

    Team Building

    Delegate CRM Goals to Teams and Employees

    Consider the CRM goals and associated objectives that you decided during the
    planning. Which goals should be delegated to which teams and employees? Make
    sure that you make the assignments according to the team performance management
    and employee performance management practices that are formally established
    in your personnel policies.
    Setting with Employees — What Should Employees Work On?
    Performance Management: Performance Planning Phase (Assigning Goals

    Also see

    Train Employees About CRM

    It is critical that all employees have a mindset of great customer relationships,
    especially as a result of having great relationships with customers. The relationship
    requires skills customer service, including in building
    , having empathy
    for others, listening,
    asking thoughtful questions
    and sharing feedback.

    Training also includes how to use the CRM software, for example, its purpose,
    how to use it, how it integrates with other computer systems, and where to get
    help. Good CRM software should come with ample documentation about how to use
    it. If you licensed or bought the software, the vendor will very likely have
    time-tested training and materials to use.
    It Simple: Training New Employees on the CRM System
    to Train Your Staff for CRM
    The Importance
    of Training in CRM Success

    Also see
    Training and Development

    Also see

    Team Building


    Manage Your CRM
    Teams and Employees

    You have already done the phases of setting goals and delegating them to the
    appropriate teams and employees. Remaining tasks are to monitor and measure
    progress toward those goals, implement performance improvement methods where
    needed, and reward/compensate teams and employees accordingly.

    For teams:
    Performance Management: Performance Appraisal / Evaluation
    Performance Management: Development (Improvement) Planning Phase

    For employees:
    and Receiving Feedback

    Performance (Performance Appraisals)


    Performance Problems

    Improvement/Development Plans


    Ensure all necessary collaborations are occurring among teams and stakeholders,
    for example, cross-collaboration between marketing, sales and customer service

    Monitor and evaluate the achievement of team and employee CRM-related goals,
    and report the progress toward achieving the organizational and CRM goals.

    Also see
    is Supervision? How Do I Supervise?

    Manage Your CRM

    The management activities specific to the CRM system include, for example to:

    • Develop useful written procedures about managing and using the CRM system.
    • Ensure all necessary employees continue to effectively use the CRM software
      — that is, they are indeed adopting the CRM system.
    • Update the content in the CRM software, for example, adding and modifying
      current contents from the functions of marketing, sales and customer services.
    • Manage the CRM software, for example, doing backups and upgrading the versions
      as necessary.

    Evaluate Your CRM System

    Evaluations should monitor various metrics, or measures, to decide how well
    the CRM system is operating. (Various metrics were listed above in the section
    2. Align CRM Goals With Organizational Goals .)

    Evaluations should especially be in regard to measuring the extent of achievement
    of the CRM goals that you had established for your customer service management

    Be sure to use the learning from your evaluation activities to improve the
    next round of the planning of your CRM system. In that way, you are indeed treating
    your CRM as a recurring system of integrated and tightly aligned activities.

    Also see
    to Design Successful Evaluation and Assessment Plans

    General Resources


    CRM Glossary
    CRM Definitions and Glossary


    Customer Service Institute of America
    International Customer Service Association
    National Customer Service Association
    American Customer Service Management Association
    SOCAP International

    Learn More in the Library’s Blog Related to Customer Service and Satisfaction

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    Customer Service Blog

    For the Category of Customer Service and Satisfaction:

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