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Is CRM Realizing its Potential After 3 Decades?

Customer Relationship Management (CRM) offers users the potential to be more disciplined in marketing and selling products and services.  It was embraced early by insurance carriers.  However, after three decades of less than inspiring results,  is there a reason to keep CRM alive?

If at first it looks like success ….

One of the first IT projects I worked on in my insurance technology career was a CRM initiative in a multi-line (P&C and Life) insurer.  The project started out as a tool for the  agents and brokers to access all the data on ‘their’ customers in order to develop sales targets and to develop and monitor sales/marketing programs.

Following the protocols of the time, we  defined data carefully, normalizing our models and mapping back to existing data sources.  We consulted widely with users to develop use cases.

We had some challenges that, with creative coding, allowed us to deliver (at the time) cutting-edge functionality.  We brought policy data together from two different admin systems, filtered the data for the specific agents (and sub-agents), added agent-specific fields, loaded the data into a local system (dBASEIII), and developed protocols to update information.

Pretty cool, we thought.

Cold shower time…

However, when we got to deployment, we severely underestimated what users really needed.  It seemed that everyone had their own idea of what they couldn’t live without.

Despite substantial support from executives, the  project was terminated without a single successful implementation.

Over the next few decades, I kept my ears open and found that in spite of every new technical development, the majority of CRM initiatives hit the same issue I did, with the same results.

So, we should bury CRM?

Possibly, but there is a ray of hope. A recent report from SMA Strategy Meets Action, called “CRM in Insurance: New Visibility and Role in the Digital Age,” notes that:

Customer Relationship Management (CRM) has a new lease on life in insurance. The intense focus on customer experience has resulted in a new appreciation for CRM solutions.

SMA provides data showing that insurers’ interest has grown substantially over that last 4 years, finding that the vast majority of insurers have CRM either installed or in progress.

So what is making the change? 

I think it is a change in focus.

In earlier days, CRM projects were developed to track information about the relationships (# of policies, agent/broker characteristics, profitability, etc.) the company had with its prospects and customers.

The ‘new’ CRM scope has expanded to understand how the customer’s experiences impact the relationships.  Mark Breading, author of the SMA report, writes:

While the original intent of CRM was to gain a more complete understanding of the relationships associated with products and people, the current trend is to incorporate information about interactions/communications, location, social networks, delivery preferences, and other information.

The customer today has more information and more choices.  The selection of one supplier over another will rely on which relationship offers greater value.  And this decision is made with every contact.

CRM is not the answer on its own

But, based on the above,  it’s a really good tool.  SMA surveyed 73 insurance entities to determine the most important technology capabilities for CRM.  The top two are Real-Time Analytics (55%) and Transactional data integration across all sources (48%).

These will then feed other operational tools which will allow other functions.

What do you think?

Does the environment and technology today allow a realization of a new CRM approach?  Are there other approaches?

One Comment


Hi Patrick, Great post to share. Thank you so much for this useful post. A new breed of CRM is quickly becoming a powerful solution for professional services firms

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