Chapter 2. CRM: A Working Definition

Defining Customer Relationship Management (CRM) is not an easy task. Coined in the mid-1990s and heavily promoted during in the late-1990s, the term CRM still means different things to different people. While ISM is convinced that there is no one correct definition of CRM, and that the definition of CRM will evolve and change over time, here is our definition for this year's Guide:

“CRM” integrates people, process, and technology to maximize relationships with all customers. CRM is a comprehensive approach that provides seamless coordination between all customer-facing functions. CRM increasingly leverages the Internet.

ISM can't stress enough the importance of the people, process, and technology integration for a successful CRM initiative. While important, all too often the technology component takes on a disproportionate emphasis within a CRM initiative to the detriment of the overall success of the initiative. Keeping this warning in mind, let us now turn to the possible components of a CRM automation system.

ISM feels that through December 2002, CRM automation will consist of 10 components as described below. Each of these 10 components consists of subcomponents (with each subcomponent equating to specific software modules offered by CRM software vendors). This means that your initial CRM automation system is likely to consist of one or more of these components—based on your prioritized CRM business functional needs—and is likely to grow over time to include additional components from this list, as well as new components that will emerge as the CRM industry matures. A word of caution: it is unreasonable to assume that any initial CRM automation system would consist of all 10 of these components, as this would be the equivalent of swallowing an elephant. As you review the 10 components of CRM, and their subcomponents, ask yourself which of these components seem to make sense for your company's CRM initiative and in what order you would incorporate these components.