CRM Fundamentals pdf

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CRM Fundamentals
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Scott Kostojohn
Mathew Johnson
Brian Paulen

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CRM Fundamentals
Copyright © 2011 by Scott Kostojohn, Mathew Johnson, and Brian Paulen
All rights reserved. No part of this work may be reproduced or transmitted in any form or by any means,
electronic or mechanical, including photocopying, recording, or by any information storage or retrieval
system, without the prior written permission of the copyright owner and the publisher.
ISBN-13 (pbk): 978-1-4302-3590-3
ISBN-13 (electronic): 978-1-4302-3591-0
Trademarked names, logos, and images may appear in this book. Rather than use a trademark symbol

with every occurrence of a trademarked name, logo, or image we use the names, logos, and images only
in an editorial fashion and to the benefit of the trademark owner, with no intention of infringement of
the trademark.
The use in this publication of trade names, trademarks, service marks, and similar terms, even if they are
not identified as such, is not to be taken as an expression of opinion as to whether or not they are subject
to proprietary rights.
President and Publisher: Paul Manning
Lead Editor: Jeffrey Pepper
Technical Reviewer: Tom McKinnie
Editorial Board: Steve Anglin, Mark Beckner, Ewan Buckingham, Gary Cornell, Jonathan Gennick,
Jonathan Hassell, Michelle Lowman, James Markham, Matthew Moodie, Jeff Olson, Jeffrey
Pepper, Frank Pohlmann, Douglas Pundick, Ben Renow-Clarke, Dominic Shakeshaft, Matt
Wade, Tom Welsh
Coordinating Editor: Jennifer L. Blackwell
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Contents at a Glance
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About the Authors ix
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About the Technical Reviewer x
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Acknowledgments xi
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Introduction xii
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Chapter 1: Introduction 1
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Chapter 2: Components of CRM Success 11
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Chapter 3: Building a CRM Roadmap 49
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Chapter 4: Evaluating Software and Consultants 65
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Chapter 5: Planning the Initial CRM Implementation 93
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Chapter 6: Executing the Initial CRM Implementation 131
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Chapter 7: Maintaining and Evolving CRM 197
 Index 175
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Contents

About the Authors ix
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About the Technical Reviewer x

Acknowledgments xi

Introduction xii
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Chapter 1: Introduction 1
Defining CRM 1
Purpose of this Book 1
Sources of CRM Value 2
Supporting a Data-Driven, Learning Organization 2
Wringing out Inefficiencies and Increasing Employee Productivity 3
Providing a Better Customer Experience 5
Informing Business Decisions 6
Preparing for CRM 7
Chapter Summary 10

Chapter 2: Components of CRM Success 11
People 11
Process 21
Technology 28
Expectations 38
Pitfalls 40
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Summary 45

Chapter 3: Building a CRM Roadmap 49
Why a Phased Approach to Your CRM Program? 49
It Takes Too Long 50
There Are No Opportunities to Incorporate Feedback 50
Building Your Initial Roadmap 50
Assess Your Current Situation 50
Developing a Roadmap Midstream 63
Summary 64
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Chapter 4: Evaluating Software and Consultants 65
The CRM Software Market 65
Functional Scope: Full CRM Suites and Specialty Applications 65
Deployment Models 66
Application Access 67
Licensing Models 68
Selecting the Right CRM Software 70
Evaluation Criteria for CRM Applications 70
The Software Evaluation Process 75
Selecting the Right Consultants 86
Evaluation Criteria 87
Final Thoughts 90
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Chapter 5: Planning the Initial CRM Implementation 93
Managing CRM Projects 95
Understanding the Phases of a Project 95
Change Management 106
Project Communication 108
Ongoing Project Management 109

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Resource/Vendor Management 117

Executive Support 123
Summary 125
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Chapter 6: Executing the Initial CRM Implementation 131
The Design Stage 131
“As Is” Process Definition 131
“To Be” Process Definition 133
Rules and Escalations 134
Use Case Definition 134
Functional Specification Development 139
Custom Development 140
Managing Custom Development As Part of Your CRM Project 141
Technical Specification Documentation 142
Integration 143
Provide a More Complete Customer Picture 144
Automate Business Processes 144
Types of Integration 145
Integration Tools 146
Managing Data-Level Integration in CRM Projects 146
Developing the Integration 148
Integration Testing 148
Managing User Interface Integration in CRM Projects 148
Linking Data Between Systems 148
Reporting 149
What Makes an Effective Report? 150

The Metric Is Specific 151
The Metric Is Clearly Owned by a Given Department or Group 152
The Metric Is Measurable 152
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The Metric Can Be Produced in a Timely Manner 153

The Quantity of KPIs Must Be Limited to a Manageable Few Items for a Given Scorecard 153
KPIs Must Have Targets 154
KPIs Must Be Aligned with Overall Organizational Goals 154
Report Sources 154
Reporting Tools 155
Designing Reports 156
Report Training 157
Data Migration 158
Do You Need Data Migration for Your Project? 159
Assessing Data Sources 159
Designing the Data Migration 161
Data Migration Tools 166
Testing the Data Migration: The Mock Migration 167
Planning the Actual Data Migration 169
Data Migration Summary and Key Lessons 170
Implementation Testing 170
Types of CRM Application Testing 170
Developing Test Plans 172
Implementation Training 175
Launching the Solution 182
Cutover 182
Initial Application Management 186

Driving Adoption 186
Change Management 187
People Management: New Job Functions 187
Pulling It All Together: Sample CRM Implementation Project Plan 187
Common Project Issues and How to Avoid Them 188
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Over-scoping 188

Overly Complicated Design 189
Software-Driven Projects 189
Lack of Executive Support 190
Managing Differing Priorities 190
Application Adoption 190
Summary 191
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Chapter 7: Maintaining and Evolving CRM 197
Role of the Steering Committee 197
Maintaining CRM 201
Supporting Employees and Gathering Feedback 201
Enhancing CRM 207
Change Control Process 207
Roadmap Development and Execution 211
Managing Large Application Enhancements 212
New Application Versions and Upgrades 217
Monitoring the Vendor Ecosystem 219
Conferences 220
New Independent Software Vendors (ISVs) 220
User Groups 220

Blogs and Newsletters 220
Consultants 221
Final Thoughts on Maintaining and Evolving CRM 221
Conclusion 222
 Index 223
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About the Authors


Scott Kostojohn, Principal
Scott acts as sales director and CRM architect for Madrona Solutions
Group, a leading Seattle, Washington, CRM consulting firm. Scott
leverages his significant experience with various CRM platforms to support
Madrona’s clients during complex implementations. Prior to joining
Madrona, Scott worked for Microsoft in a variety of roles, including
product strategy with the Microsoft Dynamics CRM product development
team. Before that, he was a CRM consultant at Equarius (now EMC) helping clients around the
country implement CRM software solutions. Scott has a bachelor’s of science degree in
mechanical engineering from Cornell University.

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Mathew Johnson, CRM Practice Director
Mathew joined Madrona Solutions Group in 2007 and currently oversees
its CRM practice. He brings a deep understanding of CRM fundamentals
and their application to the marketplace, and he works with the rest of the
leadership team to ensure that Madrona offers an exciting and challenging
environment for its employees. Prior to joining Madrona, Mathew led and
delivered business-process improvement and CRM initiatives for Acetta,
often using the Microsoft Dynamics CRM and Salesforce.com product platforms. Before

Acetta, he was a senior consultant at Onyx Software, implementing sales, marketing, and
customer service solutions. Mathew has degrees in business administration (information
systems) and communications from the University of Washington.
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Brian Paulen, Principal
Brian cofounded Madrona Solutions Group in July 2005. He has overall
responsibility for the firm’s growing business and for managing client and
partner relationships. Brian has extensive project and program
management experience and is an expert in delivering strategic sales and
marketing solutions on various platforms. Prior to founding Madrona,
Brian directed the CRM practice at Slalom Consulting. Earlier, he was a
member of the CRM team at Equarius (now EMC), working primarily with clients in the
Pacific Northwest. His career began at Accenture (formerly Andersen Consulting), working
out of its New York office. Brian has bachelor’s of art degrees in political science and
international business from Lehigh University.
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About the Technical Reviewer

 Tom McKinnie is an experienced CRM consultant and project manager who has
held senior positions at Fortune 500 companies including Nextel Communications
and Microsoft Corporation before moving into consulting. His consulting clients
include a wide range of small, medium, and enterprise-level companies in the
advertising, information technology, construction, and manufacturing industries. He
enjoys boating and mountain biking with his family in the beautiful state of
Washington.



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Acknowledgments
I would like to thank my wife, Phoebe, and children, Zoe and Zachary, for giving me
the time and freedom to work on this project. Even though this is my second book, it
took more time than I’d ever imagined. Mathew, it was a pleasure to work with you
and to see the final product. Finally, I would like to thank Scott for coordinating the
entire process and owning a lion’s share of the writing, and Tom for his careful review
and feedback.
—Brian Paulen

I want to first thank Brian and Scott for all of their support and for undertaking the
heavy lifting surrounding this book, and Tom McKinnie for his technical review. This
book is entirely to their credit, and I truly appreciate their efforts. I also want to thank
my wife, Heidi, for all of her support and understanding throughout my career—the
long days, nights, and weekends are tough for any partner to endure, and she has
handled every up and down with unbelievable grace and support. To all of the
colleagues and clients who I have worked with over the years, you have helped me
grow professionally, and I appreciate the amazing people that I have had the pleasure
to work with. Lastly, I want to thank my family for all of their love and support
throughout the years because they have truly made me who I am.
—Mathew Johnson

I want to thank my wife, Vasantha, and boys, Alex and Peter, for their support and
patience over the course of the project. Also, thanks to my coauthors and friends,
Brian and Mathew, for all of their hard work; Tom McKinnie, our technical reviewer,
for his thoughtful comments and suggestions; and the team at Apress for their
guidance.
—Scott Kostojohn
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Introduction
Many of you reading this book are about to embark on the journey of implementing
customer relationship management (CRM) software within your organization; some
of you are completely new to CRM, while others have been through a CRM
implementation with varied success. This book was written to provide business
leaders and stakeholders with a practical playbook that spells out an approach for a
successful CRM project and program.
People often think that success with CRM starts and ends with purchasing the
current popular application in the market; however, no matter the application (even
with all of its cool bells and whistles), you still need to have the hard discussions
about how your organization should be structured, what customer-facing processes
should look like, and how all your processes should translate into the system in such
a way that you effectively leverage all of the application’s great features. CRM is very
easy to do poorly, and many fail to get value from their investment; in fact, when
we’re introduced to a new client that has an existing CRM implementation, the most
common pain points we observe are caused by poor implementation of the software
(not the software itself). Don’t get us wrong—technology is certainly involved and
will impact design considerations, and the software you choose will have certain
advantages and also limitations. But the important thing to remember throughout
this book is that the stakeholders involved, business process discussions, and
modeling and design decisions are as important, if not more so, than the software
itself.
The goal of this book is to help you understand what you are really getting into
when undertaking a CRM initiative: the level of effort needed to be effective and what
you can reasonably hope to accomplish with CRM. This is not a visionary “pie-in-the-
sky” look at CRM programs but rather a “rubber-meets-the-road” guide meant to give
you a realistic approach to create an effective CRM program. Many CRM books focus
on the technical ins and outs of various systems; however, this book is technology
agnostic and focuses on the business components necessary to plan, organize, and
deliver value to your organization by leveraging CRM concepts. You are making a

significant investment in CRM, both financially and with your organization’s time, so
our goal is to help you get the most out of that investment. In the end, you will have
the skills and tools to properly assemble your team, plan your overall program and
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specific iterations, and navigate the ups and downs of a CRM project while keeping
your eyes on the longer-term strategy.
We hope you enjoy this book and are able to leverage many of the techniques
outlined on your way to CRM success!
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