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DSC Tech Library

Customer Relationship Management

CRM Customer Relationship Management This section of our technical library presents information and documentation relating to CRM Solutions and customer relationship management software and products. Providing timely customer service information is vital to maintaining a successful business. Accurate information provided in an organized and thoughtful manner is key to business success.

TELEMATION, our CRM and contact center software, was originally built on this foundation. The ability to modify Customer Relationship Management software is important in this ever changing business environment.

Telemation Customer Relationship Management solution and contact center software is ideally suited for call centers throughout the world.

Customer Relationship Management: Practical Tips for Successful Implementation

Article published in DM Direct Newsletter
July 12, 2002 Issue

By Arvind D. Shah

From the business and international catastrophes of the past two years, a new information technology initiative has arisen. It is called customer relationship management (CRM) and it is dedicated to improving through automated, especially Internet-driven, means the entire arena of customer service and interaction. If the amount of print space, conference literature and position advertisements devoted to a topic is a criterion for importance, CRM is a hot button for the IT industry as well as the entire business world. In reality, customer-driven applications have been in existence for years. Successful sales and marketing organizations have always used the principles which CRM now formalizes. So it is important that the CRM starts with an organization vision and mission, which should become part of the mind-set of employees. The objective of CRM is to give customers satisfactory and pleasant experiences in doing business with an organization. Such experiences will result in more profitable business. CRM technology enables the organization to apply sound relationship development and maintenance principles on a larger scale within the organization. In the application of CRM technology, techniques used by successful sales and marketing people become available to all employees. However, the employees must be trained and incentivised to take advantage of this powerful tool.

The advent of the Internet, personal computers, sophisticated database management systems capable of handling very large volumes of data efficiently, hand-held technologies, GUI-based workstations, data distribution and access facilities have made the CRM concept workable and have significantly raised management's expectations.

Enabling technologies and the thrust toward a customer-centric business focus have brought CRM applications to the forefront as a viable approach for increased competitiveness and profitability. Unfortunately, the success rate in realizing potential benefits from CRM projects is still lower than expected and, in fact, many projects fail even before a first phase is completed.

In the rush to implement a CRM application, many potential problems and pitfalls are being overlooked. Some involve the same considerations and principles that have been important for years, but many of these have a new twist. This article walks through a number of major potential problem areas and their impact on the success of a CRM project. For each problem, solutions are suggested.

Several broad categories of problems exist: conceptual, managerial and technical. However, the most important underlying theme of these problems is that they involve everyone, from senior business executives, sales and marketing management, customer representatives to IT technical personnel. The best way to solve problems is, of course, to anticipate them pro-actively and not let them become problems.

Problem #1 – Many Misunderstandings about CRM Exist

The most significant problem is the perception that CRM is a magic bullet, a panacea for all customer support problems. This is simply not true. This perception and the expectations that follow from it are potentially catastrophic. Overselling something as "new and hot" as CRM is likely to occur and have serious consequences for the next new and hot project. Any future CRM effort could be seriously compromised, not to mention the reputation of the IS department. This, in turn, will continue to deprive the organization of the benefits that should accrue from CRM

Another conceptual pitfall is management does not understand the consequences of not having access to integrated, cleansed and consistent data, which is the technical goal. The issue of stewardship vs. ownership will surface very quickly, opening up potential political issues that have long been dormant or which have been avoided by costly manual compilation of data.

Because CRM provides answers to queries of internal as well as external customers, the entire process of creating CRM is subject to misunderstanding. The CRM application is an enabler, not a substitute for human relationship. Failure to distinguish between the availability of value- added data and the users’ ability to use the data for better customer service cause an expectation gap.

In addition, the amount of time required to be spent with management and users who understand real customer relationship needs is almost always underestimated. Some tasks, such as vision development, analysis and requirements definition for CRM, should be carried out differently than with traditional IT system development.

Solution #1

The best solution to heading off problems is systematic education and communication with all levels of the organization, especially the executive sponsor, the project team, key users and data stewards. The education must clearly communicate that in CRM, technology contributes only 20 percent of the total effort. Having the quality data is another 20 percent. The rest is requirement analysis, system design, training the users and assuring that this application does, in fact, improve customer relationships.

The CRM project team must consist of successful salespeople, customer reps, knowledgeable users, data analysts and the CRM package expert. The team must be aware of what can and can’t be done with CRM, and what its problems are.

Management must be appropriately educated on what to expect and not to expect. They must be made aware of their commitment. Time spent in education is never wasted.

Problem #2 – The Scope of the CRM Project is Inappropriate

While the proper choice of scope is critical to all projects, doubtless dating from the very earliest systems, the correct CRM focus should be based on customer expectations, which could vary with the customer segments in your industry. For example, the needs of a retail customer are significantly different than a wholesale or institutional customer. If you combine both segments in one project phase and try to fit in one straightjacket, you could have serious problems.

In the case of one state government, the scope of a major CRM project included all member departments. The definition of information delivery and data architecture to enable CRM simply proved to be too much for the group. This, coupled with the lack of strong executive management , caused the project to fail.

In addition, if the definition of scope is too large, the analysis and implementation becomes complex, takes too long and people lose interest.

Solution #2

A sound solution to the scope issue is based on the understanding that the organization is on a learning curve in applying CRM. Try starting small, following the KISS (keep it simple, silly) rule. This is an old but successful approach technique to dealing with new things. The scope for CRM implementation could be one customer segment where users are receptive, knowledgeable and are available to work with you, and quality data is easily available. Any area you select must in any case have a committed executive sponsor.

The use of time-boxing techniques can also help control the project scope. For instance, limit the analysis to no more than four weeks and design and implementation to four weeks. Allow adequate time for piloting and field testing which should be another four weeks. This will leave adequate time for attending to infrastructure requirements and can still provide a usable facility as soon as practicable. It will also reinforce the value of the starting-small approach.

Problem #3 – The CRM Project has No Committed Executive Sponsor

The most serious – and usually fatal – problem is lack of an executive sponsor with an absolutely burning desire to see the project through. Without the blessing of strong sponsorship, any project can fail. A conflict in scope may develop, the right resources may not be available and user participation may be inadequate. However, some of the subtle pitfalls in dealing with data that must be consistent across enterprise components can also cause unanticipated difficulties. It is quite common, for instance, for groups, even small ones, to be unable to agree on common definitions of data and delivery mechanisms. Moreover, when the attempt is made to define requirements for several disparate customer segments together, this phenomenon can become more pronounced. As companies move to a greater degree of customer focus, these types of problems will surface with increasing frequency and severity.

Last, but not the least, is the need for data quality. At times the effort and commitment required to assure adequate data quality for CRM is much more than anticipated. The effect of not having the right executive sponsor to make the appropriate commitment can cause a project to bog down beyond help.

Solution #3

The solution to this problem is clear and obvious; the sponsor of the project must be an executive with sufficient clout as well as having a need for CRM. This person should have a track record sufficient to devote the adequate resources to the project. In addition, he or she should have the authority to make final decisions on the myriad issues of data definition, delivery mechanism and quality metrics that will inevitably arise in a CRM project.

In one chemical company, for instance, the inability of groups to agree on a common definition of terms such as "head count" and "net sales" caused an impasse. The issue was resolved promptly and decisively by the controller, keeping the project on schedule. Sponsorship by an executive with a burning desire and with budgets, stature and the ability to make prompt and final decisions will see a project through to success in most cases.

Problem #4 – The CRM Project Team May Lack Skills and Experience

Foremost among technical problems is lack of skills and experience in all stages of the CRM project. The application of traditional techniques in definition of requirements, for instance, will not work. Using a structured approach with its reliance on data and process models will lead only up a blind alley, since modern CRM techniques are concerned with answering customer questions, solving customer problems and giving customers pleasant experiences in doing business with your organization. Analysis to define these needs, aside from standard reports and customer communications, may be a highly iterative process, continuing even after the CRM system is populated with data. Not knowing this in advance may cause serious underestimation of project costs and time to complete.

Traditional modeling techniques will not be able to determine how many different ways data may be summarized or sorted. Not understanding the level of detail required by queries can also cause having either too much detailed data, or too little. Another shortcoming of traditional modeling techniques is that they do not address well data that may be highly summarized or derived. Not understanding this may result in data structures that are inadequate.

Many technical people with data modeling or database experience may think they know how to design for CRM. But without firsthand experience some of the problems unique to CRM analysis and design, the project timeline will run longer than planned. At worst it could end up as a major failure. Either way it could easily disappoint executive sponsors and other clientele, running the risk of jeopardizing future CRM efforts.

Solution #4

The most effective solution is to have an experienced high-level individual who can lead, staff, educate and who is available throughout the initial project from start to finish. This will not only insure project success but will also instill in the organization the necessary level of confidence to continue with expansion of CRM. Having experience in using a particular set of tools is necessary but not sufficient. More critical is having experience in implementing a successful CRM environment with satisfied customers.

In addition, specialized training in the form of in-house workshops for the project team will pay off both in the short and long run. Initially the team’s learning curve will be reduced and many wrong turns prevented. And for the long term, the entire organization will benefit sooner from the increased credibility that a first success will bring.

The following steps are recommended for planning and analysis in order to plan the system implementation.


The team must consist of users as well as business area experts. A steering committee comprised of senior executives including the Sponsor is necessary to communicate the vision, set a direction and make crucial decisions on desired quality metrics. The time line, as a general rule, should not be more than for four months (at the most six months) for first phase.

Requirement Analysis

  • Define market/customer segmentation. The analysis should treat each segment separately if necessary.
  • Set short-term and long-term goals along with the metrics to be used.
  • Identify key stakeholders internal as well as external.
  • Define the interaction (touch) points with the customer for the whole life cycle of the customer interaction.
  • For each segment, define customer expectations for the quality service.
  • For each segment, define the expectations of the internal user.
  • For each segment, define decisions to be made, problems to be solved, questions to be answered and reports to be made.
  • Define the trend and promotional analysis needs.
  • Define data needs with timeliness, summarization, historical period and naming and formatting for the users.
  • Identify the sources of data.
  • Define data quality and the cleansing required.
  • Define privacy/security constraints.


If you are making drastic changes in the current environment, you should prototype deliverables for the user’s understanding and proof of concept.

Once the system developed or tailored you should pilot it with a small subset of the users. At this time you would develop manuals and training material for users.

Problem #5 – Risks Inherent in Using New Technology May Increase

The risk of using new technology, like other problems outlined in this article, is always a critical factor in IS projects. However, in the case of CRM, which is conceptually different and may have a large user base, the usual risks of pioneering are increased. Most of the salespeople have their own way of managing their relationships and oftentimes resist the discipline as well as constraints of an automated system. The technology can be new both to the parent organization and to its users as well. Coupled with a lack of organizational experience, the results can be devastating and expensive. Mixing vendors, especially in the emerging Internet market, could also be catastrophic.

Some CRM technology is, and probably will be for some time, in a state of flux. Since most of the CRM users are less proficient in computer skills, the bells and whistles so attractive to IT professionals in new technology could be at best underutilized and at worst wasted. In addition, the presence of bugs, which are known to crop up in new technology, could turn users off very easily following on the heels of a lengthy gestation period for CRM. Remember, as with all new things, idiosyncrasies in new technology may surface at inopportune moments, since Murphy’s Law has not yet been repealed for CRM.

Another aspect of the risk in employing new technology is not knowing what additional requirements or restrictions it may impose. If it is necessary to acquire and learn new technology, the time and effort required can detract from the most important part of the CRM effort, analysis and requirements definition. A result of this may be a misallocation of project resources and the attendant loss of time as well as a depletion of customer and management resources.

Solution #5

Wherever possible use existing, tried- and-proven technology, preferably that with which the organization has some experience. If tool interfaces are needed, it may not be worth the trouble to create them. Vendors are very sensitive to what is saleable, and it is predictable that technology capable of performing needed functions will be plentifully available in the future.

For management and lesser-skilled customers, you must select technology which is simple, sturdy, bug-free and well proven in the field. The tools selected must be made easy to learn and easy to use if they are not that way to start with.

If the need to use new technology persists, it would be best to create a small pilot project. In this way some organizational learning will take place, and success is better assured. In such cases it is highly recommended to bring in outside expertise, which will be available for at least a pilot project. Although this appears more costly in the short run, the results will include a finished project and increased confidence in the technology employed. It will also allow proper allocation of resources so that existing personnel can capitalize on their current knowledge while learning a new tool.

Problem #6 – Excessive Reliance on Tools

Excessive reliance on tools – any tools – is caused by technophiles usually within the IT department. Somehow, an expectation that tools are magic is never far from peoples’ minds, especially those of technical professionals. This is not to say that tools are not needed. Developing CRM does require some functions on a large scale. For instance, the back-end integration of data, cleansing or scrubbing data, bulk movement of data as well as user-friendly GUI interfaces for data delivery are demanding technical issues even with the best tools.

Unfortunately the level of integration among products of various vendors is still not high. The result is that the project team could become fixated on the tools issues and, as a result, get nothing done while waiting for the right tool or use up valuable resources in making the tool work. The team may also try to collect data and do everything the tool demands without even understanding why. This could lead to imposing a tool's limitations on the CRM solution.

Solution #6

Put the entire tool issue in perspective by not building the CRM project around tools. Establish a sound methodology and tailor it to the scope and deliverables of the project. Let the methodology guide the use of the tool, not the other way around

Then, either look for appropriate tools or use tools available within the organization that are known, well proven and serviceable. Capitalize on the strength of the tool and work around its weaknesses. Remember that the most important activities are the up-front analysis tasks, which may not require the most sophisticated tools. These tasks involve understanding customer needs, defining data architecture, educating users and obtaining their buy-in. If necessary, build extra time into the project schedule to allow for the use of "archaic" tools.

Remember: "A fool with a tool is still a fool."

Problem #7 – The CRM Team May Underestimate the Need for Data Quality

Underestimation of the complexities in integrating CRM data from disparate sources is very common. More challenging is the quality issue. Most of the legacy systems suffer from poor quality and when you try to integrate them across systems and databases, the problem is compounded severely. A majority of business intelligence and CRM projects that have failed did so because of the lack of data quality and inability to improve it.

If current systems, which may feed the CRM project, are not documented properly, or if a lack of expertise exists in extracting data from these operational systems, the difficulties of transformation and scrubbing data may be grossly underestimated. Oftentimes, customer and product codes used within different systems may not be common or compatible.

In addition, extracting, transforming and scrubbing data from proprietary software can be a time bomb. Not fully understanding the architecture of an accounting package, for instance, can easily cause a delay. Proprietary packages may also cause other unforeseen problems. One small CRM project, for instance, was bogged down for months simply for lack of a data extraction facility from a simple package with a proprietary architecture.

A more subtle type of problem is identifying data that is required by the CRM project but does not currently exist in any automated or legacy data source within the organization. Such data must be acquired from the outside and may be very difficult or expensive to find.

Solution #7

Detailed knowledge of the systems feeding the CRM project is essential to avoiding undesired effects in loading data. If adequate systems documentation does not exist, then allow extra time during the analysis phase to create documentation. In addition, it is important also to analyze the data very carefully to anticipate the nature and level of scrubbing that will be necessary. A simple case involves date formats. The CRM project must present dates that are consistent even if the dates come from different sources. If your organization has not standardized on a single date format for all systems, you must take this into account in planning the project and designing the extraction process.

The solution to potential problems raised by proprietary software is simply to know its architecture and limitations. If documentation or in-house knowledge is not sufficient, it will be necessary to work with the vendor to determine whether data may be extracted, exactly how it appears when extracted and what is necessary to perform extraction. This will avoid unpleasant surprises and additional work during the design and implementation of scrubbing, transforming and loading procedures.

These activities should be part of up-front planning when considering a CRM project. Indeed, if you are considering purchasing a package and at the same time implementing CRM, it is imperative that these questions be answered during package evaluation and selection. It is essential, for instance, to assess the degree of compatibility involved in the data interface between the legacy systems and the CRM project. The cost of building and maintaining such an interface should be included in package evaluation criteria.

The issue of dealing with business changes lies at the heart of systems maintenance. The CRM project too must be maintained, but the question is more critical, since the data is historical. During analysis and requirements definition, it is very important to ascertain how sensitive each type of data may be to business changes, and what acceptable limits are for responses to queries for changed data. At this point, it may be necessary to communicate to management some of the limitations in dealing with historical data and possible costs that would be incurred in a conversion mechanism.

In the case of data that is required but does not exist, it is first necessary to ascertain that this is the case, which, again, will be done by careful analysis of the sources of data required by CRM users. At that point, it may be necessary to design a mechanism or possibly even a system to introduce that data into the CRM project at the appropriate time and in the appropriate format. For instance, if your organization purchases competitive sales data from external sources but desires to compare this data with your sales districts, it will be necessary to create a mechanism, perhaps using ZIP codes, that does the necessary mapping and integrates the two kinds of data. Or, it may be quite possible to pay your source vendors for this service and simply transmit data to them via a simple spreadsheet.

Problem #8 – The CRM Project May be Implemented in One Big Step

If a sound project methodology, especially involving phasing, is not followed, many of the problems noted elsewhere in this article would be magnified out of proportion. For instance, the size and physical design of a CRM database, which are major factors in performance, cannot possibly be known until the types of queries have been thoroughly defined and the level of summarization determined. Lack of experience in integrating different kinds of data could also cause dislocations in a project schedule.

Solution #8

Many of the management issues – and technical problems as well – can be addressed and minimized by phasing the project based on the type of data required.

Manageable phases in a typical CRM project are outlined below. You can pick, choose or combine, according to your needs and management priority.

1. Bring into the CRM project relatively stable, less- volatile customer master data for all customer entities.

2. Load more volatile data, but that which is easily scrubbed or requires less effort to define and create consistency (e.g., financial, sales)

3. Populate with data that is more problematic or less clearly defined, that may require significant scrubbing and transformation (e.g., planning, forecasting)

4. Implement with data that does not exist in legacy systems, and may need to be created in order to respond to CRM needs (e.g., customer demographics).

5. Incorporate externally supplied data, for instance news services from commercial sources, such as business partners.

It will not always be easy to proceed in this manner. However, recognition that some kinds of data will be easier to work with than others can serve as a guide in planning the project. In this way the risk is minimized during the initial stages and credibility is established. In addition, adequate time can be allocated for dealing with more difficult or problematic data at a later stages once a basic system is implemented and in use.

Problem #9 – The CRM Project Team May Neglect Security Issues

Finally, you must remember that the CRM project is an open facility – normally a Web-based system – that will store and deliver customer- sensitive data potentially open to many employees and customers. What is your exposure in storing this kind of data in the CRM project? Is the CRM project accessible via a public or private network? As the CRM project grows and becomes more visible and important as a corporate asset, this concern could grow. Standard security controls or tools, particularly in a distributed environment, may not provide sufficient protection without precautions. In an operational system, security to the user may be affected via a transaction code or at the terminal or workstation level. However, in the CRM project, data in one column of a table not only can have a different source from the next column, it can also have a different security requirement. Customer’s personal, medical, family and income oriented data calls for the highest level of privacy. One major global pharmaceutical firm released to Internet public their customers’ private data by one wrong stroke of key. You can imagine the damage caused by one error by one employee.

Solution #9

Do not omit security from planning and implementation considerations. If necessary use a security specialist and try to use tools that provide column and value-level security. If a public network of any kind is used, consider encryption. In addition, a special program of security education will pay dividends. In the age of globalization and the magic of the Internet, it is too easy for users to forget that an open facility has another side to it, and a few extra reminders on security issues and procedures will minimize the risk of data going to unintended and unauthorized destinations. The security should be implemented both within as well as without the automated system. Employees must be trained in the over all security system.

Problem #10 – The CRM Project May Lack Ongoing Post- Implementation Follow-Up

To be of best use CRM must respond to continually changing customer service. Lack of a mechanism for addressing changes will rapidly cause the CRM project to stagnate and lose its utility.

Just because the CRM project exists does not mean everyone will rush to use it, despite advance publicity and a strong sponsor. This will undercut the ultimate potential of the CRM project as a profitability tool.

The customer user base too is potentially problematic. We are dealing with at best a mixed bag of query formulation skills, possibly general computer skills, which could make individuals a bit shy in taking maximum advantage of the CRM project opportunities. Your salespeople may be on road most of the time. In addition, problems will always crop up with a new facility, and users, particularly high-ranking customer users, can easily become impatient in dealing with them. Some of them will make their unhappiness known, but others may simply not communicate the issues, and they will silently stop using the facility. This could cause the CRM project to die a quiet, gradual death.

Solution #10

The way to avoid long-term difficulties is to treat CRM as a retail business with many customer segments. You should keep in mind that you may have several hundred or thousand users of this centralized system and they may be geographically scattered. CRM must be included as a major item in your business strategy. This may be accomplished by several stratagems.

First, measure customer satisfaction. We are talking about two types of customer, internal as well as external. Internal customers are your employees who deal with employees. Initially measure the satisfaction of internal customers and then expand to the external.

Customer satisfaction surveys should be started within a few weeks of putting the CRM project into production status and should then be carried out on a regular basis. A carefully constructed questionnaire will not only cover results, such as " are you getting the information you need" but also probe into potential problem areas, such as usability of data, ease of access, ease of use of end-user tools or the Web site. The survey should also be accompanied by visits with customers. Breadth and depth of customer satisfaction measurements will assure continuous improvement of the CRM project on a regular basis.

Establish a policy of continuous promotion of the CRM project, along with a mechanism to carry this out. A newsletter, for instance, will apprise customers of additions and changes. And while it is doing this, it will help shape the image of the CRM project as something significant. Speaking at departmental meetings staff meetings and publishing productivity-improvement testimonials about the CRM project are also useful measures.

Establish a routine education program. Education does not stop with the initial introduction of the CRM project. On the contrary, "continuing CRM education" is a major means of keeping the CRM project in the center of the business focus. Education should also not be restricted to concepts and general information. New directions and new tool education should be kept in the forefront, and CRM education should offer help in problem solving to increase the sophistication level of customers.

Offer one-on-one consulting. In working with higher- level managers, this may be the only means of training in query creation, end- user tools and similar facets of the facility. However, making house calls will generate favorable publicity and also provide a feedback mechanism from the customer community.

Establish a help desk hot line. A repository and good meta data will help, but CRM is new and everyone has a learning curve. In addition, new hardware and software requires its own longer learning curve. A separate help desk hot line, especially in the beginning, will help customers get over many of the teething problems that accompany the birth of a new approach.

Create a CRM user group. The more input the CRM project has and the more feedback, the better. Since it requires different type of publicity and a forum for use, the CRM user group can maintain communication and contribute heavily to the development and acceptance of policies, procedures and standards for improved business operations. This is a democratic way of developing and enforcing your standards and practices for CRM.

Establish a change monitoring function. Involve the CRM users group in changes that affect all systems-related activities. This will require creating new administrative loops in such a way that the CRM project has advance notice of major changes, even if they are being planned. The bigger CRM becomes, the more the CRM users group must be involved in technology and systems planning to anticipate the impact of changes. In conjunction with this, establish a coordinating mechanism with planned new development.

Each of these activities is important in its own right. Taken as a whole, however, they will put the CRM project into the business mainstream and keep it there, so that it responds to and changes along with customer needs.


This article has outlined a number of potential problems and pitfalls that could be encountered by those setting out to create a CRM project application. Because of varying degrees of experience and expertise, no one organization will necessarily encounter all of them. The solutions offered, in almost all cases rely on tried-and-true common sense principles. By sticking to them, it will not only be possible to avoid many of the potholes along the way and complete the journey, but also to attain the highest degree of customer satisfaction.

Arvind D. Shah, managing principal of Performance Development Corporation, is an international speaker and authority. Shah has more than 20 years of experience assisting and leading efforts in e-business strategy, planning change management, business reengineering, customer relationship management, information strategy planning, enterprise architecture, data administration, data warehousing and project management for major corporations worldwide. He developed PDC’s approach to blending business reengineering, total quality management and information engineering. You can contact him at