A CRM Key Performance Indicator (KPI) is a standard measurement used to evaluate the process of delivering satisfaction to all of the customer needs from your organization. KPIs can be set up across key activities that are critical to the satisfaction of the customer. When performance falls below a required level, management can begin the process of analyzing the cause and taking corrective action. Since the customer decides who to do business with, these KPIs become imperative to retaining the customer.
Customer Satisfaction – The Most Important KPI
Customer satisfaction is the ultimate measurement of the success of your business. Without the customer there are no revenues and no reason for your business. Your purpose is to provide a product or service that the customer values beyond that of your competitors.
Flying Blind is Not the Answer
A business that does not measure its success in each aspect of its customer deliverables is just asking to fail. You may have a vision of excellent customer service, but one rude customer support agent, or a botched product installation can mean the end of a lifetime relationship. And if you don’t even know where the customer disappointment occurs, the problems will never be solved.
How to Define a KPI
• Define what information will be needed
• Define who will gather it
• Define the process to obtain it
• Define where it will come from
• Establish the frequency that it is needed
• Define who will receive it
Voice of the Customer
Another important aspect of customer satisfaction lies in capturing the qualitative success of the activity. In other words, your team may be performing to a high quantitative level, but still may be failing in the eyes of the customer. As an example, your customer service may be responding to each call in 3 minutes or less, but failing miserably in the customers eyes because they are not solving the exact customer perceived problem.
A good KPI program needs to include the voice of the customer in order to discern whether the program is actually working and if the KPI metrics you have in place really correspond to customer satisfaction. Sometimes, management’s perception of good customer service can vary widely from that of the actual customer. Building feedback loops into the process can be critical to real success of the programs. These feedback loops can take the form of on call questions, immediate post call surveys, and other follow-up techniques.
Some Examples of CRM KPIs
One of the most important aspects of KPIs is creating measurements that are critical to your own business. Each business is uniquely different, and the measurements that lead to customer satisfaction are also unique. KPIs need to be relevant to performance necessary for each touch point that the customer makes. The number of KPIs also needs to be adequate enough to achieve the performance, and yet minimal enough to avoid confusion and administrative burden. Here are a few examples that some businesses have used:
• Monthly number of unconverted leads
• Number of lost opportunities
• Email response rate
• Email click-through rate
• Funnel drop off rates
• Sales conversions to leads
• Average collection period
• On-time delivery
• Installation problems per unit sales
• Number of complaints per month
• Cost per call
• Time to first call response
• Average time to problem resolution
• Time to complete problem resolution
• Call length
• Volume of calls handled
• Number of escalations
• Customer ratings of service
• Number of customer complaints
• Average time to last follow-up (sales)
• Average customer life time value
• Customer attrition rate
• Average customer retention period
• Post sales per unit sold
• Survey ratings
• Upsell revenues
• Average profit per customer
CRM helps keeps track of all your touchpoints with the customer, and KPIs are measurement benchmarks you can use to assure your service delivery is high quality and consistent. The process begins with a CRM tool that covers all aspects of your business, and not just sales and marketing. There is a wide variety of types of CRM products, but only a few cover the whole business, and at one low price. Beware of per user pricing that escalates as each business area is added. Some products can cost upward of $250 per user, when everything is in place. If your goal is to provide consistent, repetitive service to your customer needs, then CRM with relevant KPIs can be the framework you need to get there.
WorkWise is a leading developer in both CRM and ERP software, along with comprehensive implementation and support services. Our software is designed to help make daily business processes such as finance, marketing and sales in a wide range of industries easier to handle. Our OnContact CRM software is customizable, easy to implement and features integrations including, QuickBooks Online and QuickBooks Desktop. The cost effective software features your option of either CRM in the Cloud or On-Premise. WorkWise’s OnContact CRM software can help keep track of KPIs through the information that is stored inside of the software. Listing information such as customer complaints, tracking deliveries and response rates to emails will help CRM users improve their performance in the future.