Factfile 37
Define the benefits
The starting point for any successful client focus initiative is developing clarity around what benefits the programme should deliver both to the client and the firm. People often understand different things by client relationship management and may not fully appreciate what it can and cannot achieve.
It is also important to manage expectations around the speed at which measurable financial or other benefits will be apparent. A clear and common view of the benefits will also allow an appropriate set of performance metrics to be developed.
The principal benefits (which are of course inter-related) are likely to include:
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Financial results: increased revenues (both overall and in specific markets or product areas).
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Improved profitability; prompter payment of bills.
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Greater client penetration (products and markets).
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Higher levels of client satisfaction.
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Customer referrals.
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Increased share of the client's spend (and in aggregate of all clients in the programme).
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An improved client base overall.
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A shift in perceptions of the firm and a strengthening of the brand.
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Cultural change within the firm, becoming more client (as opposed to internally) focussed and creating improved teamwork and internal integration.
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A deeper understanding of clients' needs which can assist in developing more effective and relevant products and services.
There are also softer, less measurable benefits, like enabling disagreements or problems to be resolved more quickly.
Analyse the market and client base and segment it
The programme should of course focus on those existing or target clients where the long-term return of such an investment is likely to be greatest.
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This will in part be informed by an analysis of internal financial data, but this needs to be supplemented by additional quantitative and qualitative analysis of clients' (or target clients') potential to deliver the benefits identified.
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Factors to be considered may include: size (for example, market capitalisation or estimated spend in the product/service areas provided by the firm); the extent of the client's presence in key geographic or product areas; product mix; the client's own ambition and financial performance; and the client's receptiveness to a managed approach.
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The firm should consider what kind of segmentation is useful both in terms of measuring progress towards objectives and for structuring and managing the programme.
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Types of segmentation to consider include geographic; industry sector; whether the aim is defending share or business growth; size; the complexity of the client organisation and its structure (and therefore the number and diversity of interfaces with the client); the client's culture and, in particular, their receptiveness to a structured partnership type relationship.
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The segmentation should be used both to help determine appropriate levels of investment for each segment and to shape the content of the programme at different levels.
Identify champions
In a culture where there is often scepticism about new initiatives and discomfort with the unfamiliar, it can be very helpful to identify influential partners who have bought into the CRM concept and who are highly regarded for their own client skills, to act as champions within the firm.
Seek out and listen to the voice of the client
Any client programme should of course be shaped not only by the firm's objectives and requirements but also by a deep understanding of the client's perceptions and priorities.
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Client research and feedback can also be very powerful in persuading sceptical partners of the need for CRM and demonstrating that what they value and what their client?s value can be very different.
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Feedback may need to be obtained at many different levels within the client organisation, and in relation to both the overall relationship and to specific areas of work.
Define and implement the programme
The programme is likely to include the following elements:
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Define roles and responsibilities - For those directly involved in the programme.
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Establish client teams - For each client in the programme whose role it is to manage the relationship with the client (drawing as appropriate on the wider resources of the firm) to set objectives and prepare and implement a business plan.
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Set overall targets and define business measures - It is essential to ensure that management treats this as a real priority and demonstrates commitment through personal involvement, in particular, resolving problems and supporting client teams. It is also essential those involved in the programme are held accountable for delivery against objectives and targets.
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Identify and remove any barriers to the success of the programme - These may include, for example, the availability of resource or the existence of individual or business unit financial targets which are incompatible with investing time in activity which does not generate fees directly.
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Establish a communications programme - so that staff throughout the organisation are aware of the programme and what it is trying to achieve and understand their own role in it.
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Provide training - This may encompass building an understanding of what CRM entails as well as skills training.
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Establish a client research/feedback process - There are many possible models and methods for this. The key is that information is provided to inform the content and focus of the programme, to help direct individual teams and to track progress being made in client satisfaction.
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Set up the necessary infrastructure - This will include systems, management reporting, human resources management, client development and analytical marketing support, as well as, administrative support to the programme overall to the individual client teams.
Define service standards for all staff
The strengthening of client relationships will generally require the delivery of consistently high levels of service, not only by professionals but also by all within the firm whose work affects the client directly or indirectly.
Staff therefore need to understand - and be held to account for meeting - service standards consistent with client expectations and the firm's own objectives.