CRM — Not Cutting It for Credit Unions

Credit Union Tech-Talk

June 1, 2005

Many organizations fail to achieve the expected return on investment from customer relationship management (CRM) investments. Why? Because of an inability to produce and share a single version of the truth about their customers/members. Often underestimated in enterprise-wide initiatives such as CRM are data integration, architecture, and ownership issues stemming from decades of silo-based processes, stove-piped applications, conflicting terms, patchwork interfaces, and incongruent business rules.

Research firms Gartner and META have gone so far as to say that anywhere from 50 percent to 80 percent of CRM implementations have not met expectations. What this state of affairs indicates is that there is no technological panacea for managing member relationships.

So given that the tool- and software-only approaches to CRM have proven untenable, what's a member-centered credit union to do? Instead of seeing members as part of a costly support mechanism to be avoided, the best practice is to approach your business processes from the perspective of the member and improve them accordingly. Create an end-to-end view of the member where all touch points — including phone, e-mail, chat, and Web — advance a positive and consistent member experience; an approach we call customer interaction management (CIM). Planned and deployed well, CIM can be the member-centric, process-oriented way to save money, increase revenues and create happier, more loyal members.

Don't worry; CIM does not require starting from scratch with all new technology and systems. It does mean creating a member-centric approach and some level of system integration.

CIM offers credit unions:

• A "360 degree" member view
• The ability to conduct complex transactions — such as transferring money between accounts — via Web services
• Localization of content and member information

The following steps can get your credit union on the path to member interaction management in a way that substantially increases your ability to meet business goals.

Step one: Identify member-level objectives and understand user preferences. Eliminate silos to create a member-centric path to multi-channel support.

Step two: Review your business practices and assess your support channels. How do you do business today? Who are the people that move through your workflow? How is each interaction channel currently used? What are channel capabilities and costs? Technology cannot replace good business practices.

Step three: Align channels and service models. Map common tasks to the preferred channel and related environments for each user type, and then focus on filling gaps.

Step four: Create a transition plan and begin moving users from one channel to another, or shifting the role of MSRs or other member support staff to optimize the member experience. Caveat: remember that members will only transition when they can easily see the value in doing so.

Step five: Design a measurement tool for continuous improvement. Integrate existing systems by adding capabilities incrementally in a "transition to transformation."

Your CIM system isn't just about member service — it's also about the information that you can collect during your members' visits. To take advantage of this data, credit unions need to:

• Identify important business analytics that will be tracked and reported to help make better business decisions — e.g. improving products and identifying new revenue and cost-reduction opportunities
• Apply analytics to monitor user acceptance, track member satisfaction, the effectiveness of various channels, and the "ROI" for each member interaction
• Understand member usage patterns across channels to improve efficiencies and reduce costs
• Drive the right member to the right channels
• Gauge member satisfaction
• Use member feedback to improve products and services

In order to be successful with your CRM efforts, your credit union must embrace CIM — a member and business-process-focused approach designed to turn all member touch points into a positive member experience, increasing both efficiencies and satisfaction rates. Some organizations are clinging, perhaps bitterly, to the initial promises of CRM — but the solution to their problem lies in a new approach.

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