The Big Business of Customer Relations
The concept of customer relations being an integrated process built around flow charts and spanning industries is turning into a fast-growing multi-billion-dollar software business.
In Mike Judge's wicked 1999 satire of corporate culture, Office Space, there's a delightful character named Milton.
Poor Milton. He's all but invisible. No one likes him, no one talks to him, and coworkers are forever stealing his stapler. Management doesn't notice him enough to fire him.
Instead, Milton is shunted from desk to desk, each time losing more of that precious commodity denoted by the film's title, until he finally winds up alone in the basement, where he plots the delicious revenge he'll take on the company.
In times past, customer relations staffs were where the Miltons of the world most likely landed. If you couldn't do anything else, you could probably listen to phone complaints all day. No one wanted to, but somebody had to do it. And so they did, until they went mad from boredom or frustration.
That was then. Today, there's a new shine on customer relations departments, and the field has earned itself a fresh, glossy title and a widely recognized abbreviation: customer relations management, or CRM. And it's become an integral part of the SaaS (software as a service) industry.
The Rearview Mirror
But first turn back the clock to the 1970s, before the real blossoming of the computer revolution.
In that era, most companies—especially those in the Fortune 500—paid little attention to customers, who were largely forgotten after they'd ordered something. Big company execs, knowing they had enormous resources at their disposal along with a major market presence, had the attitude that they could always replace customers if necessary.
Then came the dawn of the Information Age, with ever more powerful business computers and personal machines that began to proliferate in buyers' homes. Now people could make more informed decisions about whom they wanted to buy from. Globalization eased the task of switching suppliers if they were unsatisfied with someone's customer service.
At the same time, businesses had rapidly increasing computing power at their fingertips. The confluence of these two factors led directly to the beginnings of CRM in the 1980s.
At first, with the rise of sophisticated database creation and maintenance technology, it was referred to as "database marketing." Databases were employed to create focus groups to communicate with customers, particularly the most valued. Problem was, data was gathered primarily through repetitive and inefficient surveys, and in the end, surveys don't yield a great deal of useful information.
There were processing and analysis hurdles, as well. No task-specific software yet existed that could take all the data being amassed and spit something actionable out the other end. Eventually, companies came to realize that what they needed was to compile simple information they could make plans around: what the customer was purchasing, in what quantity, how often, how much was being spent, and what was done with the products purchased.
Copyright 2011 Minyanville Media, Inc. All Rights Reserved.