Strange as it might sound, customers are human too. So why does the current VM vogue for CRM seem to be manifesting as a dehumanising fad dreamt up to cross and up-sell?

Whilst it's a somewhat depressing thought, it would appear that the regular ebb and flow of 'management fads' is here to stay and the automotive industry appears to be no exception to the rule.

In the last few years we have had: TQM, ISO/BSI, kanban, JIT, re-engineering, downsizing, vendor managed inventory, globalisation, e-commerce, key account management and now CRM - Customer Relationship Management. The process is always the same: they come, they conquer, disappoint and then disappear. Meanwhile academics publish books and add the subject to their MBA courses; publishers run conferences, seminars and launch dedicated trade titles; the major consulting firms suddenly develop 'specialist' divisions devoted to it, and they all push the merry-go-round faster and faster, until it's time to jump off - leaving the adopters alone, in a spin and feeling dizzy!

From the 'religious' zeal with which CRM, and its predecessors, have been accepted and then defended, the ranks of VM management seem to be populated by those sharing a mind-set with those from 'darker' periods of human history. It's almost viewed as heresy to gainsay a vogue in its early stages, however it's equally hard to make a really objective judgement at this stage too. CRM is definitely well on its way to becoming 'the' business fad for the early part of the millennium. The problem is that CRM has its roots in the fields of service quality and customer loyalty, something that the majority of those consultancies and IT businesses leading the CRM charge, have neither experience nor success in designing or implementing within their own organisations, let alone another major business! It's equally obvious that their collective quid pro quo is the sale of software and hardware, good old fashioned product pushing! How ironic that they are so often portrayed as the CRM White Knights galloping to the rescue, panacea in tow.

So it's critical to determine the substance and ignore the smoke and mirrors. Undoubtedly there exists, in the majority of organisations, the need to be more responsive to their customers, so that some form of customised response can be developed. Something that the entire automotive industry could benefit from particularly with recent developments from the UK's Office of Fair Trading!

Indeed in his most recent book Philip Kotler lists this as the major way to compete successfully in the new millennium. I can also personally attest to the fact that this approach works, most recently taking a £2,000 account to £350,000 in two years - based solely on getting 'inside' the customer.

Old segmentation based on geo-demographic means is no longer relevant, a new paradigm is called for. To be effective CRM must turn to behavioural and psychographic segmentation - turning to the techniques long used by those in fast moving consumer goods.

So what are the pointers to ensuring this philosophy pays off?

Well, a whole variety of sources accept a five point, or principle, structure:

1. Relationships involve people and emotions
2. Different people like different types of relationships
3. Be wary of panaceas produced from whiz-bang technology
4. Loyalty comes from trust and value, not bribery
5. You can't be all things to all people

The problem, it seems, is that CRM is being discussed in a 'sterile' environment as a means to 'manipulate' customers - as if it is another programme you switch 'on' with windows on your PC in a morning. As Robert Shaw, visiting Professor of Marketing at Cranfield University recently pointed out, 'technology and information are at best responsible for 25% of your CRM competence'.

Equally a lot of the approaches imply that there is an ideal formula that an IT system can 'Plug and play' into an organisation - sheer fallacy! How can a standard system cope with the nuances of individual buyers, their organisations, their buying cycles, and what happens when all your competitors have a similar, if not identical system? How will it still deliver an advantage to you?

Transactional buyers will always be that, they want to use a service or product in the simplest, most straightforward manner and get on with their life. Often because the product is of 'minor' concern, they buy on the best 'offer' - no IT system will ever change this behaviour. At best you buy a one off hit, at worst you create a price perception that leads to a downward price spiral - just look at the supermarket wars for a salutary lesson!

Customers are human and need to be handled as such, they do not just buy the rational product offer, they buy the emotional offer too - often this is the reason they buy! People buy on emotion then justify their decision with fact. A relationship is a warm two-way communication between human beings, it requires that the desires, needs and values of the customer come first, not IT infrastructure. That's why the crucial aspect of any successful relationship strategy has to be based on the quality of that interface - customer to supplier.

Whether it's a sales force, technical personnel, customer services or anyone else from the supplier, to excel at CRM they have to be adept in a range of skills and techniques, from Neurolinguistic programming, personality profiling, psychographics, information processing and questioning techniques through to report writing, telephone technique and information gathering. They have to know who likes the high-touch and who's hands-off, who likes high-tech and who's in the Stone Age! They have to manage a complex mix of brand, product, service, people and circumstances to generate revenue from increasingly demanding and sophisticated buyers.

CRM systems have their place, they can be a proactive support mechanism, but only when a skilled and focused interface between supplier and customer is present, coupled with a company strategy to deliver service excellence - they cannot compensate for amateurism in this area. That's why you are better off investing in developing the relationship skills of your people; it's an investment that will save you money and heartache, as well as giving you a skilled workforce where it matters - at the coalface!

Andy Whalley
HeadWhay Limited
20, Range Green, Tipner, Portsmouth, PO2 8RE
023 9264 4113 or 07974 188057