InformationWeek
Defining The Business Value Of Technology
September 27, 1999
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Customer At The Core
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But true success comes from ensuring that all employees and business partners who need to use the information have easy access to it. Olsten Corp., a Melville, N.Y., provider of temporary-employee services, is constantly gathering and maintaining a customer history database, providing access to the data from more than 600 field officers.
"Anybody in the organization around the country that deals with a customer has access to that customer data," says Olsten CIO Jim Harding. "They can update the data with the most current information, including any issues or problems that arise, visits we make to the customer, their current hiring activity, new requirements by the customer, and outstanding orders." Olsten has built a 1-terabyte data warehouse, using an Oracle database and a Sun Unix server. Olsten uses a reporting tool from Cognos Inc. to provide detailed reports to customers so they can better track their effectiveness in filling temporary positions.
The temporary-employee services agency also wants to link its databases to the Web, and it hopes to develop a way to profile customers so Web sites can cater to individual needs. For example, according to Harding, if a company often hires IT professionals, then its IT or human-resources department will automatically find information on the Olsten site related to high-technology workers.
"In the staffing business, the only differentiators are your ability to deliver quality people constantly and to use technology to make it easy for customers to deal with you," Harding says. "We want to get information they need from us to help manage their business, so that working with us is a much more valuable partnership, and we're not simply a place where they order temps."
The links between the Web and data warehousing and mining are proliferating in other industries. The Grocery Manufacturers of America trade association aligned itself with a group of major food, beverage, and consumer-goods companies to learn how to make better use of data mining and develop grocery industry standards. The goal: tracking consumer buying trends and improving inventory and product shipping processes. Participants in the project include Anheuser-Busch, Nabisco, Procter & Gamble, and Warner-Lambert.
Indeed, data warehousing is a key strategy of the customer-centric focus. When asked what systems they're using as part of their company's knowledge-management strategy, 93% of the InformationWeek 500 companies said they rely on relational databases, and nearly as many-some 86%-say they are deploying data warehouses. Other key knowledge technologies in place include groupware, text and document search applications, data mining tools, teamware, expert databases and artificial-intelligence tools, group-memory and context-management tools, and expertise profiling.
Managing The Relationship
Many companies are turning to customer-relationship management systems and services to better understand customer wants and needs. CRM applications-often used in combination with data warehousing, E-commerce applications, and call centers-allow companies to gather and access information about customers' buying histories, preferences, complaints, and other data so they can better anticipate what customers will want. The goal is to instill greater customer loyalty.
"We define the relationship as the totality of transactions, accounts, interactions-every way that we come in contact with customers in any of our businesses," says Pete Lacovara, departmental VP in the corporate IT group at Prudential Insurance Co. of America. Lacovara is responsible for developing the CRM strategy at the Roseland, N.J., company.
Prudential is in the midst of a multiyear program to better understand existing and prospective business and consumer customers. This includes customer-relationship applications from vendors such as Siebel Systems Inc. and Clarify Inc.; relational databases such as DB2; an Extensible Markup Language messaging infrastructure linking Web applications to legacy systems; a data warehouse with information on some 20 million customers; and enhancements in communications and call centers.
A major goal of the project is to ensure that all parts of the organization have consistent and completely up-to-date information on customers. "We think identifying the customer in a uniform way across the enterprise is tremendously important," Lacovara says. "We want to make sure the customer has the same consistent service feel whether they're dealing with an agent or brokerage or whether it's for real estate or property and casualty. The customer has to be understood-in terms of attributes and characteristics-the same way in each business. We're creating an encyclopedia of customer knowledge."
At the same time, Lacovara notes, Prudential has to remain sensitive to privacy issues. "We know there are certain pieces of information that we don't share between business lines because we don't feel it would serve the customer well, or because they won't like it," he says.
CRM technology allows Prudential "to capture and remember what a customer did with us," Lacovara says. "If they tell us not to call them, we remember that. Or if they say they need to get auto insurance now but they'll be interested in investment stuff in about a year, we remember that. It's good for us and for them."
Tools such as CRM are increasingly vital to building a customer-centric enterprise. When asked to identify the most important benefits their organization receives from its investment in customer-management tools and applications, technology managers at InformationWeek 500 companies mentioned "customer satisfaction" nine out of 10 times.
Other benefits noted included the ability to provide faster response to customer inquiries, increased efficiency through automation, having a deeper knowledge of customers, getting more marketing or cross-selling opportunities, identifying the most profitable customers, receiving customer feedback that leads to new and improved products or services, doing more one-to-one marketing, and obtaining information that can be shared with the company's business partners.
Only 2% of the managers said their companies weren't receiving any benefits from customer-management systems.
Regardless of the customer-relationship strategy a company takes, one thing is clear: The technology now exists to allow companies to know and serve their customers better than ever.
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