Power to the People: Implementing Constituent Relationship Management in the Public Sector.

• Author: Kavanagh, Shayne

Despite rising interest in constituent relationship management (CRM), few governments have implemented these systems. This article draws on the experience of the Michigan Economic Development Corporation to provide a frame work for successful CRM implementation projects.

Constituent Relationship Management (CRM), or Customer Relationship Management, is a class of software designed to provide governments with the ability to manage their citizen relationships consistently and effectively through a variety of channels. CRM has been one of the hottest technologies in the private sector in recent years, and is now sparking interest in the public sector as well. The rubric of CRM encompasses a number of different capabilities designed to automate front-office business processes such as call center management. CRM clearly holds great promise for the public sector, which has as much need to manage constituent relationships as the private sector. However, since CRM is so new and because private-sector CRM applications (e.g., sales automation) do not directly correspond to government, the verdict is still out on the utility of CRM to the public sector. This article explores the value of CRM to the public sector by examining the case of the Michigan Economic Development Corporation (MED C).

About the Michigan Economic Development Corporation

The MEDC is a quasi-state agency whose purpose is to promote the retention and expansion of jobs in Michigan. The agency prides itself on fostering economic development based on traditional principles, while adapting those principles to modern realities. The MEDC's service areas include business development (i.e., attraction and retention), business services (i.e., site location, recruitment, training), emerging business sector development, and marketing. The MEDC has approximately 300 full-time equivalent employees and a total budget of $132 million, most of which ($94 million or 71 percent) is spent on direct program costs such as grants and tourism promotion.

The MEDC seems to fit the prototype for a public-sector organization with a clear imperative to institute CRM. Although the MEDC does not face direct competition in a private-sector sense, it does operate in a competitive environment. For instance, the MEDC's business attraction and retention functions must accomplish their work within the context of economic incentive programs from other states. Businesses have the option of choosing between various localities, and the MEDC must work to ensure that businesses are aware of the advantages of locating in Michigan. And because there is a great deal of overlap between the MEDC's various service areas, it needs an enterprise-wide CRM solution to unify customer information across the organization and to coordinate departmental efforts.

The Genesis of the MEDC EDGE CRM Project

The Economic Development Growth Engine (EDGE) project refers to the MEDC's current efforts to institute a modern, integrated CRM package. Prior to the EDGE project, the MEDC used various homegrown applications designed to emulate basic CRM functionality. The most recent of these systems was the Business Opportunity System (BOS), which was primarily used by the MEDC Business Development Unit.

In fact, the MEDC project did not start out as the drive for a fully integrated, functionally robust CRM package that came to be known as the EDGE project. The MEDC originally began by looking for a "contact center" application to route contacts from various channels to the appropriate parties according to pre-defined rules such as contact volume and expertise. Upon further examination of the CRM market, however, the MEDC discovered the wide range of available functionality and decided to expand the scope of the project. The following four business goals drove the decision to pursue an enterprise CRM system:

1) link all customer touch points to ensure that customers receive the most consistent and effective service possible,

2) consolidate data from disparate databases to reduce duplication of effort and improve operational efficiency,

3) establish workflows (1) to more effectively monitor the progress of economic development opportunities and to more efficiently move work through the organization, and

4) develop greater continuity between business units to better coordinate customer contacts.

Establishing clear business goals for the pursuit of a full-blown CRM solution was critical to the success of this project. Leading CRM software packages possess a vast array of functionality. Organizations that fail to define clear goals for their CRM projects risk capsizing in a sea of functionality. Because no CRM system at the time provided all of the necessary functionality, the MEDC decided to utilize both a contact center application and a separate enterprise CRM suite. (2) The two software firms that were ultimately selected had an established business partnership.

Implementation Structure

The MEDC implementation consisted of three phases, each of which is described below. Interestingly, the MEDC did not originally conceive of this project in phases; it evolved into phases once the complexity and scope of the project became clear. The MEDC's goal was to implement the contact center solution and integrate it with the enterprise CRM solution by the end of its fiscal year--a nine-week timeframe that placed considerable pressure on the implementation team.

Phase 1

The first phase involved setting up the call center application and basic CRM functionality among a core group of workers. This phase involved four front-line employees from the MEDC's Contact Center, nine account managers from the Global Business Unit (a division of the Business Development Unit), and eight specialists from various organizational units who provide direct services to constituents. These groups were selected because they represented an important link between the first contact with potential leads and the mechanism for transforming those leads into concrete results. The groups were also small enough to constitute a manageable pilot project.

This phase served to rationalize contacts by routing them to staff who did not have excessive workloads and who had the necessary skill sets to effectively handle the contacts. The MEDC implemented skills-based routing whereby e-mails and Web chats were directed to employees based on where they originated on the MEDC Web site. For example, if a customer were on the export services section of the MEDC Web site, e-mails, and Web chats from that customer would be routed to an exporting specialist.

Once a contact was routed, it needed to be logged in the enterprise CRM system so that it could be further managed. Accomplishing this task required the development of an interface from the call center application to the enterprise CRM system in order to transfer contact information such as name, phone number, and address. This interface was the major hurdle of Phase 1. The MEDC was able to overcome this hurdle by developing a cut-and-paste feature between the two programs. Although this was not a real-time interface between the two systems, it was sufficient to allow the MEDC's system to function effectively. It also allowed the agency to meet its goal of implementing the contact center and integrating it with enterprise CRM before the end of the fiscal year.

Rolling out basic CRM functionality was also part of Phase 1. This initial rollout was a largely out-of-the-box version of the enterprise CRM solution with a few minor configuration changes. These changes involved changing the names of some fields and adding a workflow to ensure that the agency responds to contacts within 24 hours. This enterprise CRM would eventually replace the MEDC's homegrown CRM system, BOS, throughout the entire organization. The Global Business Unit was to be the vanguard for this transformation. This required a data conversion from BOS to the CRM system. The data conversion proved to be much easier than the call center/CRM interface.

Phase 2

Phase 2 marked the...