Expert offers reasons for CRM

• By Dibya Sarkar
• Jun 06, 2002

While governments are still struggling with the definition of customer relationship

management, they are committed to implementing systems to help improve the

delivery of services and constituent satisfaction, according to a CRM expert.

Citing a recent Input marketing survey, Jill Dyche, who recently wrote

"The CRM Handbook," said the federal government will spend $520 million

in 2006 on CRM systems and services, up from $230 million last year, representing

an 18 percent annual increase.

"That basically means that governments are committed to doing it," said

Dyche, who was keynote speaker at a public-sector CRM conference hosted

by software company SAS Institute Inc. Dyche is partner and co-founder of

Baseline Consulting Group, which specializes in designing, building and

analyzing customer databases.

Dyche said governments should determine why they need such a system

before implementing one. In a small minority of instances, no business cases

can be built for implementing a CRM system, she said.

For example, she said a state transportation agency had wanted to collect

data from vehicles, which were equipped with a transponder that used the

electronic toll collection system on highways. When she asked agency officials

what they were trying to solve, they told her they wanted information about

where drivers were heading and what they were driving.

"They could not answer one question: 'What value will this program provide

your constituent base?' " she said, adding that citizens could perceive

this instance as invasion of privacy. "There has to be a quid pro quo. [People]

have to feel they're getting something in return."

Dyche said the reasons for implementing CRM in government should include:

* More efficient delivery of services, such as automating services (for

example, direct deposit of tax refunds), fewer people handling services

and therefore lower costs, and lower likelihood of human error.

* Improved auditing and fraud detection.

* Higher level of private scrutiny.

* Compliance with the Government Paperwork Elimination Act of 1998.

* Higher constituent satisfaction.

For example, in Michigan, the state Family Independence Agency implemented

a CRM system providing recipients with electronic benefits smart cards instead

of food stamps, she said. That enabled officials to track where recipients

bought groceries and also helped them monitor fraudulent use of cards. Data

was shared across other agencies, as well as counties and school districts,

she said, and added that CRM data provides a "360-degree view" of citizens.

In Des Moines, Iowa, the city automated its call center on the Web so

citizens could ask questions as well as report problems, such as a pothole.

The citizen can get a tracking number for the problem and, in some cases,

the city provides an estimated time when the problem will be resolved, Dyche

said.