Forget CRM, think MCR

Nov 10 2015 by Andy Hanselman Print This Article

I meet many business leaders who tell me they’ve got a real ‘CRM focus’ in their organisations. They’ve invested heavily in IT systems and spent a lot of time and money in training and developing people. They’re ready to take on the world!

But the reality is that all they’ve really got is a database with a lot of names in it, while their staff spend all their time filling in forms to feed this beast. Maintaining and keeping customers is becoming an increasingly tough job, but this approach simply won’t work.

So forget fancy CRM systems. It’s time to turn your thinking round and focus on MCR - that’s Maximizing Customer Relationships. In other words, proactively developing relationships that give the best to, and get the best from, the customers you want.

This isn’t about databases, it’s about relationships. Of course, I’m not knocking databases, but it’s what you do with the stuff that’s in them that counts.

Here’s a simple model to help you look at your relationships (Remember, this can include ‘internal’ customers too!)

How do your relationships measure up? To help you see where you are, here are some simple descriptions. Clearly they are ‘different’ for each type of business, sector or customer, but hopefully they give you a ‘feel’ for what they look like. Your challenge is to work out what these relationships look like for your business, and crucially, for your customers!

Giving Relationship: The customer is doing very well out of this relationship, but you’re not! Perhaps it’s the customer who constantly asks ‘can you just?’, consistently receives discounts, or regularly plays you off against your competitors. Are you giving too much away, or not charging for things you could or should?

A couple of key questions to consider: Is the relationship like this because you’ve allowed it to get this way or because you’ve been pushed into it? If it’s the former, what can you do to educate your customer, and try to get things on a better footing for you - if they value what you do, you may be pleasantly surprised what they’ll pay for!

If it’s the latter, which way is this relationship going? At what point are you prepared to say ‘no’ or ‘enough’s enough’? Because if you don’t you could be heading for a.....

Losing Relationship: Neither of you are winning, but guess who the customer blames (and tells others about)? What can you do to get out of this type of relationship (or maybe out of the relationship itself?)

Taking Relationship: In the short term, this looks good - it works for you until the customer finds out! Are there more things that you could / should be doing for your customer to ‘maximize’ the relationship?

This could mean educating the customer about your full range of products and services so that they can get the best from you (this might result in more business!) and move towards becoming a...

Maximized Relationship: This is the win-win. It could be a very simple transaction - you’re easy to do business with, the customer gets what they want and they pay you (on time!). Equally, it could be an in-depth, trusted and ongoing relationship, maybe even a partnership or joint venture! Again, it’s defined by you and crucially, your customer!

Maximized relationships are the goal and very rarely just happen. They are all about understanding your customer’s goals and objectives, and working hard to help them achieve them. Obviously, it’s about you achieving yours too, whether that means sales and profit margins, customer loyalty, levels of repeat business, or other specified targets specific to your business. The critical bit is ensuring that you do actually know what you want to achieve, and so does everyone in your business!

So, seven questions that you might want to consider:

  1. Do you have a clear picture of what you want from your customer relationships?
  2. Whereabouts on this grid are your key customer relationships?
  3. How do you actually know? (Hint: ask your customers!)
  4. What can you do to find out? (Hint: see above!)
  5. Which way are those relationships heading?
  6. What are you doing / need to do to get them where you want them?
  7. What do other members of your team / business think? (Hint: ask them!)

Maximizing customer relationships doesn’t just happen by chance. It’s a proactive process and needs to involve everyone in the business. Your challenge is to work out what Maximized Customer Relationships means for you and what you can do to create them. It’s then about creating your own recipe for success.

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About The Author

Andy Hanselman
Andy Hanselman

Andy Hanselman helps businesses and their people think in 3D. That means being Dramatically and Demonstrably Different. An expert on business competitiveness, he has spent well over 20 years researching, working with, and learning from, successful fast growth businesses. His latest book, The 7 Characteristics of 3D Businesses, reveals how businesses can get ahead, and stay ahead of their competitors.