KNOW thy CUSTOMER - Company Operations

Industry Standard, The, Nov 6, 2000 by Michelle V. Rafter

Building a comprehensive CRM program doesn't happen overnight. It requires careful consideration of a company's goals, planning for the processes and technologies needed, and most important, cash. To succeed, management and employees have to get behind the effort. But if everything comes together, companies might find that the customer information they've been sitting on all along really is a gold mine.

THE POWER OF INFORMATION

How a struggling travel agency turned itself around by understanding its corporate customers.

In 1997, International Tours of Kansas City, Mo., was a, typical midsize travel agency, with 44 offices, 180 agents, and -- thanks to dwindling airline commissions and' the rise of Internet travel agents -- an all-but-certain death sentence.

Today, reborn as an, online-only corporate travel agency, and renamed iTravel, the company has quadrupled its client base since January to more than 800 small and medium-size companies representing tens of thousands of business travelers.

The company made a turnaround with help from investors and new leadership, who vowed to revive the company using the Net and to capitalize on its No. I asset -- customer information -- to improve sales and service.

Getting from then to now was no small task. Client information was lost inside a hodgepodge, of unintegrated computer and paper systems the company used to track flights, transfer payments to airlines, prepare bills and handle customer service. Bookings through the Web site were minimal. The company clocked how long it took customer-service reps to answer a call, but it didn't monitor how many times a' client called to book a plane ticket, a key indicator of how much a transaction costs.

Knowing he couldn't survive on airline commissions alone, current IT President Steve Harmon asked clients what services they'd pay for in exchange for travel discounts. The answer: more detailed reports on how employees use travel services and how iTravel saves them money.

To get there, Harmon zeroed in on improving customer relationship management processes and the technology needed to carry them out. Over 18 months, he spent $5 million reworking the company's individual computer applications into a group of integrated components connected to a Siebel-based customer database. These included an accounting system that also produces client activity reports, and a Microsoft Exchange-based customer support center that lets the same rep handle questions from phone calls, e-mail and the Web site.

Overall, Travel's CRM initiatives helped the company eliminate two of the three phone calls it usually took to book a ticket. Today, iTravel, delivers 92 percent of its travel bookings electronically, compared with an industry average of 46 percent. Electronic "smart agents" keep track of business travelers' preferences, upgrade them automatically and send e-mail notices. And thanks to the new data-mining system integrated with the Web site, officials at iTravel learned to identify the new customers who needed the most help and to head off a more expensive phone call to a rep with online customer service.