Introduction of the company
This research paper analyses the case of
Indigo and the implementation and effects of Customer Relationship management
(CRM) tools in the organisation. Indigo was started in 1977 as a first mover in
the market, providing high quality digital printing press and the organisation
remains as one of the leading innovators in the digital printing solutions
industry.
Hewlett Packard acquired indigo in March
2002 and the company now operates as an independent division in the larger
organisation, by the name of Indigo Digital Press.
Indigo is an international company
employing over 150 direct sales representatives spread over a global territory.
The primary products offered by Indigo are high quality digital printing
presses distributed chiefly in markets across Europe and America. The
organisation also deals in proprietary ink (consumed majorly by commercial
print shops); industrial solutions such as packaging, plastic cards and labels
among others. Operating in over 40 countries, Indigo sells products like
commercial printers, personal use quick printers, packaging and labelling
plants.
The subject of this paper is concerned with
the implementation of CRM in the organisation prior to its acquisition by
Hewlett Packard.
Pre CRM state analysis of the company
Indigo already had in place, an application
to support its manufacturing, logistics and supply chain operations; however,
the organisation had a serious support technology issue in the marketing and
sales department.
The year 1998 brought forward an increasing
concern for monitoring and increasing the productivity and effectiveness of the
organisation’s sales force. The company faced a plethora of obstacles and
challenges such as the ones under mentioned:
1. The organisation lacked any capability to monitor its sales
processes and was thus incapable of identifying various barriers and
bottlenecks in the process. This stifled all efforts to shorten the sales cycle
and close sales faster. Hence, long time taken to close sales was a serious
issue at the time.
2. As already briefed Indigo is an organisation that has had a wide
geographical spread over countless global territories. This lead to another
major problem; sales managers couldn’t clearly monitor the actions of their
subordinates and gauge whether the
sales force was investing time wisely in the correct prospects or not.
3. The management noted that sales representatives were being forced to
waste time in gathering information (much of which was irrelevant) from the
front office; hence, a need was felt to provide condensed relevant information
and tools to the work force in order to increase its productivity.
4. Indigo was a company fast expanding into new markets. This required
the recruitment of new people in the organisation. However, the company’s
existing training and orientation programme was so slow that it made
impossible, the quick transfer of leads to the new representative quickly.
5. The lack of a system prompted sales representatives to keep sales
logs, forecasts and leads on excel sheets or hand written notes. These notes
were then passed on to the sales manager over phone or email; who in turn
communicated the same to the higher management. This system was more or less
like a Chinese whisper leading to a lot of discrepancies in the information
communicated. There was an urgent need to keep an organised consolidated record
of leads and sales forecasts in order to expedite marketing and sales
operations.
All these challenges combined, prompted the
top management of Indigo, to integrate an automated tool which could streamline
marketing and sales function thus, increasing organisational efficiency and
profitability.
SWOT Analysis
Given the above brief of Indigo’s scenario,
the SWOT facing Indigo at the time can be summed up as under:
Strengths
1.
As a fast expanding company,
Indigo possessed the resources and the base that enabled it to better its sales
and marketing programs.
2.
Given Indigo’s experience with
CRM applications in the field of manufacturing, logistic and supply chain
management, the organisation already possessed relative comfort and experience
in implementing such automated applications.
Weaknesses
1.
The cost of implementing such a
system could have been a major hindrance.
2.
Reluctance of parties involved
in using the new system could have lead to a failure of the operation.
Opportunities
1.
Increasing sales figure and
market dominance provided a ready platform for the company to improvise on the
existing systems.
2.
Availability of various CRM software
applications from various companies, meant healthy competition in the software
industry; thus enabling procurement of the best fit technology at competitive
prices.
Threats
1.
Use of similar mechanisms by
competitors was a major threat to Indigo; this could seriously jeopardise the
market leadership Indigo had secured.
2.
Failure to implement the system
in accordance with the requirement of the organisation and non compliance by
the user staff.
CRM program objectives
Gauging from the Pre CRM tool
implementation state, managers at Indigo had the following objectives in mind
regarding the CRM program:
1.
Closing Sales/ Customer
Acquisition- Managers at Indigo required a tool that could shorten the total
time involved in the sales process. A CRM tool was needed that could help in
shortening the total time involved in closing a sale thus increasing the sales
turnover of the organisation.
2.
Monitoring team efforts- The
management at Indigo also wanted to establish an automated tool that could help
sales managers to monitor the activities of the workforce assigned to them and
enabling them to guide the sales force in the right direction.
3.
Processing information/
Customer Retention- The CRM to be established by Indigo was to be dexterous
enough to summarise and condense information relevant for the marketing and
sales people helping to save precious time that can be employed in turning over
a profitable sales.
4.
Expediting training- The CRM
was also aimed at establishing a quick training and orientation schedule that
could minimise loss of information and leads, in the process of transferring
them to the new recruit.
5.
Forecasting- The CRM would also
help in consolidating records and figures to punch out forecasts prepared by
the help of expert monitoring from the select group of specialists appointed on
the system.
CRM Vendor Product
Selecting a CRM tool vis-à-vis other options available
While managers at Indigo were planning to
implement a CRM system in the organisation a variety of options were available
to the company to choose from. The top management appointed a small vendor
selection task force to shortlist or suggest, from prospective vendors, an
optimal CRM solution.
One of the prime options available to
Indigo was lotus notes since, it was the cheapest option given the company had
already paid for the purchase of the software two years ago. However, the
software needed heavy customisation to fit the organisational needs with regard
to marketing and sales.
Research conducted by the Gartner group and
Forrester research had arrived at the conclusion that Siebel was the market
leader in the CRM solution provider industry; the vendor selection task force
was quick in assimilating this information and began weighing Siebel as a
strong prospect vis-à-vis lotus notes.
The task force arrived at the following
understandings by evaluating the systems provided by Siebel:
1.
The license costs of Siebel
software were comparable with other software in the market.
2.
The Siebel software
specifically provided focuses support to sales functions.
3.
The software provided had a
richer user interface making it easily operable.
4.
Unlike lotus notes (which
needed heavy customisation), Siebel systems were a precise fit to the
organisation’s needs.
Given the above mentioned learning,
managers at Indigo were quick in accepting Siebel as a better and more
adaptable Customer Relationship Management system fitting Indigo’s sales and
marketing needs due to its top end functionality, and an up to date, easy to
use, intuitive user interface.
The Team
The top management at Indigo set up a
committee, which included senior management from the marketing, sales and IT
departments (the focus areas for the CRM projects). Additionally the team
recruited Director of Marketing (Europe) as the project leader; and Ronnie Ben
Zion as the IT project manager and analyst for the software implementation. In
the US and the European market, the team appointed two marketing professionals
for training activities; also a database administrator was hired to administer
CRM database. In addition to this team Siebel extended a helping hand by
offering the services of a technical account manager, who helped in the
actuation of Siebel’s Rapid Action Deployment (RAD) methodology.
Implementation
The team outlined an approach to implement
the new CRM system and undertake the change management process. The
implementation was a step by step process, explained under:
1.
The team focused on keeping the
CRM application easy and simple to use; this was done to reach at desired
results faster and ensure that concerned people accept the system readily. This
was extremely crucial to gain acceptance from users who were not very keen on
sharing information, or weren’t tech savvy or couldn’t perceive the benefits of
the application.
2. The team also resolved on minimising customisation in order to make
the application easily manageable and keep it upgrade friendly in the future.
This in turn also helped in keeping within budget (by utilising what is already
there rather than customising) and timelines.
3. The project team also decided against an all at once implementation
strategy; rather they opted for a phased approach in order to minimise the
risks involved in implementation and making the task manageable (by not letting
all the pressure come at once). It was agreed to that the new system would be
rolled out region by region; starting with North America and proceeding to
Europe. This helped in building a checkpoint where the new system could be
tested and results assessed and verified before proceeding on to investing more
in the software’s license fees.
4. The team also decided on an inclusive approach to involve all the
users in the actuation of the implementation process. The team regularly
consulted sales representatives and managers to secure their feedback in order
to ensure that the system was functioning as per the requirements of the job it
is set to service. This also helped in the application gaining easy acceptance
by its target users.
5.
Lastly the project leaders
zeroed in on the objectives of the training; they were to be to educate the
sales representatives, managers and other users about the importance and the
logic of having the CRM application in the organisation rather than merely
training them on how to use it.
Infrastructure
requirements
The implementation of the CRM application
required the establishment of critical knowledge, information and hardware
infrastructure. The project team began with utilising Siebel’s RAD methodology.
Under this method the first task was to establish the scope of the main issues;
the major issues highlighted by such an approach were:
1.
Creating a closed loop sales
process
2.
Enhancing the productivity of
the sales force
3. Obtaining reliable sales forecasts.
A decision was reached to of not adapting
the software system to current sales and marketing processes in the
organisation. This required a complete process re design and re architecture
and establishing a common sales process in territories across the globe.
A major challenge facing infrastructure
modelling at the time was to adapt to a system that uniformly defines sales
territories. Until then all territories were defined by area sales managers;
some were known by city names, other by countries and even some were known by
routes and highway numbers. The project team felt a need that territories be
defined by their zip or postal codes and this be used as a universal reference
while noting in sales records.
The new application infrastructure also
focussed on eliminating irrelevant information from the screen view and
consolidating other useful information which was earlier unwieldy due to being
spread over and being incomprehensible.
Parallel efforts were being made to create
a user manual and a training system that could be used to train the users on
the new sales process system implemented by the CRM application.
After running a brief pilot program in the
October of 1998 and adjusting for minor modification, the team embarked on the
process of data migration. This process was concerned with importing existing
data – accounts, contacts, activities among other data fields. This exercise
revealed data duplication and redundancy in various places hence the need to
employ the services of the software Dataflux was necessitated to identify and
filter out duplicate records.
In the following month of November, phased
roll outs began. The implementation was done for a new branch every week in
order to map branch territories, import data from data sources , installing
application on the user’s computer and individually training the user on the
application making them adept on the operation of the software.
The last part in the creation of the
infrastructure for the implementation of the CRM application was concerned with
creating a conducive environment wherein all members of the organisation
readily accept and promote the new system. The chief operating officer at
Indigo issues the dictat that if data weren’t presented on Siebel, its
existence wouldn’t be considered; hence initially apprehensive members were
also made to experience the system. Along with this, middle management adapted
and expanded to include the new company policies and procedures to motivate the
work force in the organisation.
360 degree program
Along with creating the required
infrastructure the IT team of Indigo worked on consolidating the CRM report
from all the data already available in the pre existing system. This enabled a
360 degree view of the audience of the company. Customer information such as target
audience identity, customer behaviour and identifying varied target segments
and customer profile identity became easier under the new architecture of the
Siebel CRM application.
Thus in all these years of the CRM
application roll out the software has become an integral part of Indigo’s
organisational culture.
Training
The project management’s philosophy
regarding training was that users of the interface should not only learn how to
use the system but also learn the logic and reason behind the system so that
they are aware of its functioning and can fully accept it as a part of their
work life.
The project managers opted for a phased
roll out of the CRM application so that:
1.
Stage wise feedback can be
noted and corrections made as the program was being implemented.
2.
Individual attention was paid
to each user so that complete acceptance could be assured and all doubts could
be resolved.
Establishing a timeline
The project team established a 3-6 months
deadline to implement the Siebel CRM program.
1.
The project planning started in
the mid of 1998.
2.
By October of 1998 the
architecture and designing of the Siebel came in force.
3.
By November of the same year
the project team started rolling out the new CRM application.
Hence, the project managers were able to
keep the project implementation in time thus, keeping within budget too.
Establishing a budget
In this section the researcher has
attempted at making a rough estimate of the budget that would have been
employed in changing to Siebel’s marketing and sales function CRMs.
The cost heads are listed below:
Implementation costs
1.
Consultation costs
2.
Siebel license costs
3.
Data Migration
4.
Training costs
5.
Establishing corporate culture
6.
Dataflux license costs
Recurring/Annual costs
1.
Software maintenance fees
2.
Ongoing training and
orientation program
Estimated total cost per user $1000 per
user per year.
Given that number of users in the first
year was approximately 150; total estimated costs in the first year were
approximately $150,000.
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