Creating a good CRM

The term CRM is overused as misused as “In the cloud” and “Big Data”. However, the hype of it has sold lots of technology. Now don’t get me wrong, I strongly believe in understanding and tracking your customer’s transactional behavior with your company as well as thoroughly knowing their preferences. The main point is that it is not all about technology. If you just want to use the data to offer targeted marketing and special offers then that is relatively easy and slightly effective. The real power of the data is using what you’ve learned about your customers, to enhance loyalty with your company as well as deliver an improved level of service. 

In order for CRM data to be effectively used the team members closest to the customer have to be enabled to use the data to make a difference

The way to get this right is to ensure that the data is used closet to the customer. One of the key ways to accomplish this is to ensure your “CRM” is actually part of your transactional system that is either directly used by your customers (such as your website) or used by your team members that directly service your customers. In a hotel environment it does no good for your CRM data to only be used by your marketing department. It needs to be fully integrated into your property management, reservations and point of sale systems. Once that is done then the operation teams need to fully utilize the information drive service. Let me give you a simple example. I’ve seen a hotel check in a guest who has stayed there about 50 times and the front desk agent asked them if this was their first time staying. The agent should have welcomed them back and done something special for being such a loyal customer. If you are going to gather or ask your customers for their preferences, then you really should use them in a meaningful way. I am a very frequent flyer and I think the airlines are the worst at this. As I said, in order for CRM data to be effectively used the team members closest to the customer have to be enabled to use the data to make a difference. There are few boutique hotel companies that do this well. Amazon and Zappos do it the best from a pure e-commerce stand point.

We work hard to recognize our customers. We have completely integrated technology but at the end of the day it really comes down to how well it is utilized. So with all that said, make sure that your use of customer data “CRM” is well defined with clear business goals and objectives. Make sure the entire business is aligned with those goals and prepared to use the information to drive revenue, customer loyalty and customer satisfaction.

Role as a CIO

I have learned that significance of the role of the CIO depends on where in the organization the position reports and to whom. The position needs to report to the most senior position in the organization such as the Chief Executive Officer. In addition the CEO and the board must believe and support that technology is an integral part in the success of the organization. During the past 15 years as a CIO, I have reported to the CEO. In one organization the importance of the CIO role dramatically changed when one technologically minded CEO left and was replaced with one that did not see the value that technology could play in driving the business forward. I’ve also observed from other organization that when the role reports to the CFO or other functional C level leader technology does not have play as significant role in the organization. Now with that said, it is the CIO responsibility to ensure that he/she and the technology department are viewed as business partners to the organization that bring value. If they are just viewed and / or operate as the department that fixes the computers then they will not be an integral part of the business.

The hospitality industry went through some very difficult times during the banking crisis of 2008 / 2009. It was imperative for companies to ensure they managed their costs in orders to sustain the down turn. While we, like many other companies, reduced unnecessary expenses and maintained an optimal cost structure yet we never lost focus of the importance of using technology drive revenue and maximize efficiency. During the downturn my role expanded to not only manage technology but also to manage the marketing efforts. Effectively for the second half of 2009 and all of 2010 I was the CIO and the CMO. In January 2011, we began to execute a significant growth strategy and I again refocused just on technology to facilitate our many acquisitions during the coming years. All throughout that time technology played a key role in the organization.