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 Government CRM Questions | FAQs

Government CRM Questions and Answers

What is Government CRM?: Executives’ Top 5 Q&As

1. What is Government CRM?

Customer Relationship Management (CRM) systems have been used widely in the private sector for several years, and until about five years ago were thought to be a poor fit for government. However, since then things have changed dramatically. Moving their products away from the sales model to a customer-service/service delivery focus, CRM software vendors have developed systems specifically targeting government activities and most have renamed these products Constituent Relationship Management (CRM) systems.

World-wide, thousands of local, state and federal agencies have adopted CRM, which has had particularly notable success in Singapore and Europe overseas, the Commerce Department in Washington, and dozens of major American cities like Baltimore, Chicago, and LA. In the US, the 2007 government share of the CRM sector was at a healthy 6% and projected to grow by 5.5% annually.

2. How does CRM work?

CRM requires the integration of existing agency databases related to constituents into a single interface available to the relevant public-facing staff, and across agencies, if appropriate. That interface’s content, appearance and capabilities are tailored to the agencies’ needs. A common user interface is designed to record and display constituent contacts from any communication channel, such as telephone, fax, email, or face to face contact. Therefore, any staffer in communicating with the citizen will see all interactions across agencies and channels and be able to address issues with a holistic view of the government-constituent relationship.

Through advanced analysis and reporting functions, CRM also allows agency officials to better analyze trends in areas such as services requested and response times. Taking a cue from the private sector, CRM facilitates marketing campaigns that can proactively reach out to constituents who request regularized information or for conducting satisfaction surveys.

3. How does CRM improve service delivery and reduce costs?

CRM systems tailored for state, local, and federal government offices, which include both a managerial strategy as well as an IT component, are designed specifically to increase levels of service delivery in the following ways:

  • Boosting Labor Efficiencies - Service improvements are facilitated by creating efficiencies in business processes, such as time on phones, processing payments, and reducing paperwork.
  • Reduced Transaction Costs – Greater efficiencies also reduce transaction costs.
  • Improved Information Capture – CRM is designed to capture the information relevant to the work of your office AND other government or business offices that you partner with in the performance of your mission and display it in one constituent account. Moreover, these systems are designed to integrate communications via email, phone, fax, and in-person.
  • Information Integration – By sharing relevant data with your government partners, public-facing staff in all offices will know what other arms of the government are doing in regard to your constituents, thus providing better customer service and delivery through single-point access to information.
  • Reduced IT Headaches – Some CRM services are web-based and hosted off-site from your office. That means no additional IT support staff time, software, hardware or memory requirements.

As government executives and agencies are generally evaluated on their performance targets and those targets are increasingly tied to improved customer satisfaction and service delivery, CRM is seen as a very practical, smart and cost-effective tool for use in government.

4. Are Some CRM systems better than others for government?

Absolutely. Government executives should be wary of vendors with little or no experience in the public sector CRM realm. Products originally tailored to business that are then lightly modified for government or remain as "commercial off-the-shelf" (COTS) will unlikely capture unique government business processes, accommodate government information security mandates (such as NIST C&A, FIPS 199) or satisfy mandatory Section 508 requirements for disabled or impaired staffers. Go with a vendor with proven government experience and certifications.

Another important area to consider is that there are two CRM delivery methods: Client-based software, loaded onto local networks and individual computers, and web-based software. Client CRM software is still abound, but it is becoming increasingly clear that the best fit for government is through a delivery method called "Software-as-a-Service," or SaaS. Also referred to as "On-Demand" or "hosted," SaaS technology is delivered over the internet, and can be accessed from any location with internet service. Experts predict that within the next decade, the majority of software for government, business, and individual users will be hosted.

Although not always true, government is now seeing more On-Demand vendors with modules tailored to its needs. For example, both Oracle and Aplicor have been innovators in providing customized government CRM solutions and helping agencies improve their management of constituents using this technology. Much more than a change in software technology, SaaS has brought fundamental changes in the procurement, implementation, delivery, management, maintenance, support, and user adoption of CRM systems in the following ways:

  • Procurement is based on a monthly subscription for as long as the system is used and away from a front-end capital expenditure.
  • With no need for new hardware or software, implementations are accelerated, cheaper and easier on the agency or organization.
  • Interface delivery is over the Internet offering "anytime, anywhere" access "on demand" by the user (hence the nickname).
  • Software management and support is out-sourced as part of the subscription fee, thereby requiring no in-house resources. Hosted systems provide instant system upgrades, eliminating the need to make changes on individual computers. User adoption is easier as staff are readily familiar its with Internet-like navigation.

5. What are the Costs and Savings Associated with CRM?

Initially, there can be start up costs surrounding the customization of the functionalities and interface to the business processes of the agency, as well as training of staff. Once functional, agencies generally pay an annual licensing fee that is based on the number of users (i.e. the more licenses purchased, the cheaper the user "seat cost") Decision makers enjoy the flexibility of renting the host’s IT infrastructure, software application and technical support on a pay-as-you-go basis.

Beyond the savings accrued from increased productivity and decreased transaction costs, the use of a hosted system provides the next level of savings. SaaS systems eliminate the need for advanced hardware planning and expense and provide virtually unlimited growth potential and on-demand "scalability." In other words, hosted solutions allow immediate expansion as your agency needs it through the purchase of additional licenses, and eliminate the need for advance investment in hardware and bandwidth. Further, there is no need to continually upgrade and rotate hardware as new computing power makes old hardware outdated and obsolete. Potentially variable and unpredictable expenses become predictable fixed monthly expenditures. Hence, budgeting is easier and more flexible and the associated potential cost-savings are obvious.

 Government Customer Relationship Management Software