CRM Welcome to the Engagement Age

In fact, governments should start thinking beyond current transformation models for service delivery and begin thinking about transforming the very nature of their businesses in ways that make sense to citizens. Engaging stakeholders – the citizenry – is the logical next step to connecting citizens. Governments that resist organizational and strategic imperatives for engagement will find themselves becoming increasingly irrelevant – and worse, all their e-government ingenuity will be wasted. Modern comptrollership and performance measurement strategies will be difficult to attain and implement. Client (or Customer) Relationship Management (CRM) is the vehicle with which government will journey into this new Engagement Age; CRM is what will sustain e-government initiatives like Government On-Line (GOL) beyond its original mandate.

CRM is not a technology as much as it is a business strategy, a service commitment, a business process mode, and a new organizational paradigm. As a catalyst for the Engagement Age, CRM is poised to take electronic service delivery to a new level – a customer-led plane that enables true government, and indeed, true democracy. In fact, CRM has already begun to advance government organizations into the Engagement Age.


For years we’ve only thought of CRM as a commercial application tied to sales force automation, call centres and data warehouses. However, a look at recent leading e-government initiatives around the world reveals the key characteristics of CRM: personalization tools, horizontal support, integrated services, portals, clusters and gateways, and multi-channel 24/7 support. At the dawn of the Engagement Age, we now see that the CRM techniques that have been working for larger commercial organizations also work for governments. Canada is at the forefront of CRM public sector applications, as is the United States and Singapore. Many of the projects launched under the later part of Canada’s GOL initiative have had a distinct CRM slant as the government finds new ways to break down departmental information silos. The Canada Site, its three “gateways” (for Canadians, non-Canadians and Canadian businesses) and their many Web cluster sites are examples where the federal government has attempted to customize information in ways that are useful to citizens. Personalization tools such as those created for and others are a further step toward the CRM goal of meeting and/or exceeding client expectations.


Relationships are of course intangible and as such cannot fit into the kind of metrics required by project directors. In CRM practice, there is debate over the role of tangible and intangible metrics. There are two schools of thought on whether the tangible return on investment (ROI) or the intangible return on relationship (ROR) is a more suitable indicator of success. Both, in fact, must be considered because while government executives measure the ROI of projects, citizens are more preoccupied by ROR. To citizens, the core of ROR thinking pertains to how much value they feel they are getting out of their e-government experience. It is distressing to think that fewer than 48 per cent of Canadians bother to browse government Web sites despite the investment in e-government. Perhaps few Canadians perceive value in their government’s on-line services complement. A high rate of ROR, although not tangible, is nevertheless quite achievable, and the key tenets of customer relationship management can ensure that governments receive a high rate of return on their relationship with citizens and businesses.

CRM – Critical Success Factors

The truth about CRM is that it is expensive, time-consuming and difficult to implement. Moreover, up to 70 per cent of CRM projects do not produce measurable business benefits. What is the main reason for CRM failure? The short answer is that most organizations find it difficult to make the organizational changes required to become customer-centric. They need to address a series of critical success factors (CSFs) for CRM projects:

CSF 1 Developing an Organization-Wide Strategic Plan

A strategic plan should provide direction for the organization, describe its goals and priorities and identify prospective strategic projects. As a strategic initiative, CRM should fit and have the capacity to affect corporate-wide strategic direction. Implementing CRM solutions on an enterprise-wide level can take anywhere from 6 to 12 months depending on the organization’s size, processes, customer data and resources, among other variables. Therefore, it is better to start a CRM program by initiating small, consecutive projects with short-term cycles within a larger strategy for long-term implementation. Establishing quick successes will ensure management buy-in and support, accelerate learning throughout the organization and establish a solid base for CRM implementation on a large scale.

CSF 2 Understanding Business Processes

On one hand, CRM is about data integration from various information sources into one common solution. On the other, it is defined as a service and business transformation process. The common denominator of CRM processes is that they should be designed around business systems and processes that reflect customer requirements with the ultimate goal of improving the customer experience. As such, assessment, evaluation and understanding of current business processes are all essential to CRM project success. A CRM project will be more successful if the CRM desired features are mapped to the business requirements.

CSF 3 Thinking Critically

CRM decisions should not be based on product demonstrations and terrific sales pitches. Such instant and impulsive decisions can result in a system that does not support organization and client requirements. In fact, corporate strategy and business processes should dictate CRM functionality and this functionality, in turn, should dictate the technology and tool selection. CRM is not a technology process – it is a technology-enabled business process.

CSF 4 Supporting Multiple Channel Delivery

In order to meet clients’ expectations for information delivery, organizations have to employ a variety of methods and channels to reach their clients. In planning the implementation of a CRM solution, a multiple channel delivery unification strategy should be developed. The CRM solution will ensure that no matter what channel a client uses to access information, the information is accurate, reliable and, above all, easy to access. This centralized approach to information delivery will increase clients’ satisfaction and loyalty.

CSF 5 Managing Change

As mentioned earlier, most CRM projects fail because of an organization’s inability to adopt a more client-centric approach to business. Therefore, when developing a strategic plan for a CRM project, change management transition strategies should be in place to ensure that the new business processes are adopted as quickly as possible and that old ways of doing things are phased out quickly.

Getting Started

For the sake of simplicity, our “getting started” steps are limited to only the first five strategic steps.

1) Identify specific business-line relationships – G2C, G2B and G2G – that require managing. These relationships should present the greatest opportunity to both the business line and its citizen-clients-customers.

2) Determine pertinent data sources and data owners and develop an integration strategy that encompasses people, processes and technology.

Develop a case for change and sustainability using requirements analysis, feasibility studies and an assessment of solution enablers for organizational change, process reengineering, and technology.

3) Develop a case for change and sustainability using requirements analysis, feasibility studies and an assessment of solution enablers for organizational change, process reengineering, and technology.

4) Develop measurement criteria from the outset that realistically define project success and demonstrate how well CRM aligns with the organization’s vision, mission and objectives.

5) Identify champions to support the CRM program from strategic development through to operational utilization.

These five strategic steps must then be followed up with a number of additional business transformation, technology implementation and change management strategies that will ensure the success of the initiative.

When governments determine their role in the Engagement Age, they will begin to recognize that, despite all the efforts to break down information stovepipes, vertical and horizontal integration of information remains elusive. It is a fallacy to think that ready access to information or even efficient electronic service delivery is the only measurable outcome of a successful e-government program. Ultimately, the citizen-customer will make the final decision as to whether any e-government program is successful. Therefore, it is not the information or the service that makes an e-government initiative thrive, but rather the relationships that form between government and citizen, business and other governments. These strong relationships can be nurtured through customer-centric and customer-led business processes that break down organizational boundaries. Hence, the role of CRM in e-government is to act as a validity and sustaining agent.

Robert Randall ( and Alexandra Katseva ( alexandrak@intoinfo .com) are e-business strategists with Ottawa consultants intoinfo. Robert specializes in business transformation and change management while Alexandra has focused on business transformation, knowledge management and user requirements analysis.

IT looks different in a government bottle

As governments begin to deliver services through electronic channels, Customer Relationship Management (CRM) may ultimately be renamed – as Citizen or Constituent Relationship Management. But no matter which appellation is on the label, the government vintage of CRM will need to be much more than old wine in new bottles.

Mike Scotten of Accenture, for example, sees significant difficulties around CRM in government. Scotten is responsible for Accentures’s Canadian government CRM practice. And while he and his colleagues around the world have been seeing a lot of uptake in government around the basic concept of CRM for the past two years, he believes some formidable barriers remain, not the least of which are concerns about privacy and security.

“That is a huge issue on their minds,” Scotten said. “If you look at it, you are kind of walking the rooftop: How do I do this stuff in a fairly transparent way . . . but at the same time not violate anyone’s privacy concerns? That is a huge issue for the federal government, for Treasury Board.”

Even CRM terminology can trigger unease among government managers. One of the first principles of the CRM art is to identify customers and sort them into different groups, something that bureaucrats are often loath to do.

“The ‘segmentation’ is one of those terminology barriers that we are finding within government,” said Scotten. “CRM principles, we are finding, apply very well to government, but there is a real terminology barrier. Say CRM to a lot of government executives and they immediately think ‘private sector,’ ‘profit focus,’ ‘this is not for me.'”

Andy Aicklen, managing director of PeopleSoft Canada, agrees that the language of CRM can interfere with perceptions of its adaptability in government service delivery.

“You have to watch the wording,” he said. “If you try to tie it back to e-commerce, I think you’re going down the wrong path. . . . I talk about getting closer to your constituencies and something that everybody is comfortable with now, with a browser on their desk.”


At Vancouver-based Pivotal Corporation, which sells CRM solutions in the mid-market range, Chief Financial Officer Divesh Sisodraker says governments need to create a vision of how they will deliver services electronically long before they begin thinking about the technology they want to install.

“The decision may be made that the best way to accomplish the strategy is with a single package or maybe in some cases multiple packages,” Sisodraker said. “But technology enables strategy, so the vision and the strategy for the government needs to be laid out before you even start having a technology discussion.

“If the strategy isn’t laid out, you end up in an environment where frankly you probably have a number of separate initiatives underway at any given time. And that costs money, more money than it should, if you have to deal with integration issues later, when you start to realize that it makes sense to glue these systems together.”

Accenture’s Scotten says a focus on customer insights means identifying customers and their needs. Once those are clear, he said, program delivery can be adjusted.

“After those two steps, what is the right choice of interaction channels that you have available? Because five or six years ago, you could go talk to someone or phone them or send a piece of mail.

Now there is a whole multitude of channels available and each of them has a different cost, from a couple of cents on the Internet up to $100 or $200 for a face-to-face visit.”

But, Scotten says, there are inherent barriers to effective CRM implementation in the public sector because governments have grown up around program delivery and specific areas of jurisdiction. “You find with CRM, when you do it effectively, that you get it right down to, ‘How am I going to get the right message to the right person, regardless of how I’m organized internally?’ That is the biggest barrier we’re finding to implementing the stuff.”

PeopleSoft’s Aicklen notes however that, despite the perceived barriers, public sector interest in CRM is picking up. “We’re starting to see some dollars come to the table. There has been a lot of tire kicking, but now they are starting to see some value.”

Aicklen believes most CRM initiatives will be in the municipal sector. “What is really interesting is that they are seeing it as a marketing tool, getting community services information out to their citizens on school closures, snow removal, West Nile virus, things like that – and all of a sudden you are seeing a little more value for the taxpayers’ money.”

In Aicklen’s view, the more proactive and better financed governments will be the first movers in CRM technology – “maybe not the ones that are trying to hang on with a deficit type budget.”

Leadership is critical for Aicklen. “A lot of new mayors see the value of technology, but then there’s some that have been in their jobs too long and they think that pencil and paper will work just as well. The infrastructure gets laid (correctly) because somebody at the top says, ‘This is what we’re going to do, to make a difference.’

“It’s not the majority; it’s the leaders that are seeing the value of it. They have to go to their city councils and sell them on it, and that’s a tough job these days, or any day.”

Scotten says Accenture operates off “a concept we call ‘think big.’ Understand who you are going to reach, what are the offerings you are going to send them and how you are going to interact, and then start small and scale fast.”

“Meaningful CRM is not going to happen unless there is some sort of senior executive who is really going to drive it,” Scotten adds. “To do CRM and realize all the benefits is not a bottom-up evolution. If you do bottom-up evolution with this stuff, you end up getting technology half-implemented and sending the wrong messages through different channels. You end up with a disaster on your hands. This has to be top down.”

Pivotal’s Sisodraker said there is a danger of governments being oversold – or overselling themselves – on the benefits of CRM. “I believe that you can say generally that people have very ambitious aims for what they want to get out of a CRM application. Our approach is to help bring them back to reality, ground them and help them understand that the right approach to implementing CRM is to knock off a small phase or a small piece at a time and build some momentum with the application rather than try to do it all at once in kind of a ‘big bang’ mentality.”

Not About technology

Scotten said the fundamental message from industry to government about implementing CRM would be: “It’s not about technology. I think the biggest thing we found in the first survey was that governments are primarily coming at this from a technology focus. It was the same way that uptake originally happened in the private sector.”

Unfortunately, many surveys of private sector executives reveal great dissatisfaction with the results of their CRM projects. In light of those expensive lessons, public sector managers may temper their expecta-tions and tailor their expenditures to meet realistic and achievable goals.

Richard Bray is an Ottawa journalist who specializes in high technology. A former reporter and producer with the CBC, he is also a former editor of Ottawa Computes. He may be reached at