Management | Technology : Think before you buy

CRM, or customer relationship management system, is a software system that is designed to allow a firm to get the most out of the relationship they have with their clients by careful manipulation of the data they have, and can collect, as business develops. Many industries, such as the retail industry, thrive on this type of software as they recognise the value in understanding their customers.

Law firms have used CRM systems for a number of years now, but a recent report suggests that the vast majority of law firms with CRM systems are not getting the best out of them. The report, by MPF and The Thriving Company, suggests that it is in the management of these systems that failings occur, and thus reduce the potential leverage they can bring. This is likely to be fairly accurate, but probably does not tell the whole story.

Matching strategic and operational

As with all system purchases, matching '¨the strategic and operational requirements '¨of the firm to the products that are available is critical, but in the case of CRM many '¨firms sidestep this most vital task. This leads to system purchases that are not fit for purpose from day one, thus dooming the project to failure at worst, and at best, '¨limited return on investment. It's not difficult to see how this happens. CRM vendors produce very nice demonstrations of their products (as they would - they are after all marketing types) and this tends to seduce prospective purchasers.

This may be due in part to the general malaise surrounding the will to undertake substantive requirements analyses, or fear that it may add to the cost or duration of the project. Part of it may also be due to the lack of a coordinated strategic approach to marketing, or the firm's inability to follow a strategy once devised. There is a suspicion among industry analysts that far too many firms think that buying a CRM system will solve a problem for them, in a plug-and-play fashion. The reality is somewhat different, in that a CRM requires potentially more on-going maintenance and control than almost any other kind of system, and so requires long-term commitment in terms of both financial investment and resources.

If you have analysed your needs, and '¨are happy to go out to the market to purchase a system, you have a reasonable range of products to choose from. Of course, you may well be able to narrow the choice down significantly by careful comparison with your requirements. Along with the choice of systems, you can elect to buy into cloud-based systems, or server-based systems. There are advantages to each approach, such as the flexibility of the cloud solutions versus the potential programmability and integration offered by the server-based variety.

So far I may have sounded like the harbinger of doom when it comes to CRM, but the reality is that a good system, properly set up, managed, and maintained will more than likely earn its keep, and provide a decent return on the investment in it. CRM systems can provide a range of advantages from ease of sending information to clients through to delivering streamlined and specific personal service. The advantages they bring are likely to allow you to maintain competitive differentiators, or open up new markets and attract more clients. We all take for granted that when we call a large utility, service or retail company, they seem to know an awful lot about us, and that makes the experience of interacting with them much more straightforward. Law firms are not utility companies, but there is still a lot to be gained by being able to present '¨a knowledgeable front when clients call.

Challenge yourself

When considering what CRM product '¨to buy, or even whether to buy or not, '¨there are several factors that should be taken into consideration, once you have gone through the process of identifying '¨internal requirements.

Data handling is a key issue for CRM systems. Any new implementation will require data from existing resources, normally a mixture of whatever is held in the firm's practice management system, and the various Outlook contacts lists throughout the firm. The ability to ingest data is critical and going forward, the ability to talk to existing data is likely to be required. This sounds simplistic, but really does need thinking about. We are used to having simple notions about our use and storage of data internally, but CRM has a tendency to challenge '¨these notions.

Consideration will need to be given to what type and style of information you want to pull out of a CRM system. This may sound obvious, but many implementations are stymied by the fact that users cannot extract what they want from them, and subsequently avoid using them to input or output information.

Other items such as training, the ability to customise the product, the security of the data and how you achieve a high adoption rate, which incidentally is a crucial to success, need to be factored in carefully. As with all large scale technology projects, the care and effort that is put into the selection and configuration of a product will be reflected in the return you get from it.