System thinking and CRM
The problem is, that as human beings we think in straight lines – cause and effect – while reality happens in circles. If you are going to truly thrive through these difficult times, then you need to break out of this linear world. Fans of Peter Senge will recognise this as Systems Thinking, and it is one of the themes of the Webinar you can register for at the end of this Blog.
Linear thinking
The problem with thinking in straight lines, is that so often you get exactly what you expect. Along with a lot of businesses, you might think about this period of uncertainty as being about surviving the inevitable downturn in the economy. Your logic might go something like –
“We are in a pandemic and no one is sure what is going to happen. May be the economy will shrink and businesses will struggle, so they will invest less. That means there is risk and I have to make sure my business survives. So the easiest and most obvious way of doing that is to cut discretionary spend and as I expect people to want less the obvious cut I can make is to the marketing budget. For one thing it is much less fixed, than say wages, and I can get it done instantly. But of course, if you cut marketing you will get fewer leads, which means fewer sales and that means declining revenues and a further squeeze on profit – and you will have confirmed exactly what you feared.
Thinking In Circles
The problem with cause and effect and linear – straight line thinking – is that you don’t see the whole picture, however complicated you model these cause and effect relationships – Senge calls this detail complexity. That is because the whole picture in the real world, has to include the way each of these snap shot events impacts on others, creating feedback loops. The other problem is that causes and effects may not be as close in time and space as we would like to believe – Senge calls this delays. Our problem is we don’t really have a language to represent this dynamic complexity and the richness of these relationships. If we did the scales may fall from our eyes, and we could stop reacting and start creating our future.
An example of Circle Thinking – CRM
CRM stands for Client Relationship Management – so straight away this suggests that it is about relationships between you and your clients. It is also about recognising and managing the feedback between what you do and the effect this has on the value of these relationships, by collecting and analysing the data you need to see what’s really going on. So how might you use this to turn a fight for survival into an opportunity to THRIVE.
CRM Principles
To do this we need to go back to what CRM is really about, which isn’t technology. Way back in the 80’s Don Peppers and Martha Rogers were pioneers in CRM long before Salesforce was on the scene. They described these principles of CRM – (1)knowing more about your clients than your competition (2) using what you know to treat them as individual so that (3) you can communicate and listen to what they say and (4) give them what they want every time. in my view these principles hold true to this day.
Circular CRM
If we used these principles and the relationships that they are built on, could we not THRIVE instead of just survive? The CRM strategy for the current pandemic could look something like this:
- The business is focused on building life time value in its client relationships, and captures the information it needs to do this
- It uses this information about why people buy (needs they must satisfy, goals they need to meet or problems they need to solve) to talk to them about how these can be met in times of the pandemic.
- It does this by making it easy for these clients to talk to the business about how they want to meet these needs, goals and problems in the current situation or about the new ones they face.
- From this information the business co creates with them a solution which gives them exactly what they want. And by doing this it also creates a product and service which works for others.
- This co created solution then secures the on going Life Time Value for its clients. But the business also now has an offering that works in these times of Covid, when all its competitors are withdrawing and surviving.
- That way it attracts new clients and grows the value it has in its client base – it THRIVES
Change your mindset with this webinar
Circular Thinking is JUST ONE of the themes in this Webinar on 12th November that will help you not just survive but THRIVE .
