CIOs, ERP And Furthering The Customer Experience

CIOs And ERP

Chief information officers want a seat at the top table and experts expect that it won’t be long before they get there. In its CIO 20/20 report, HP predicted that over the next six years the role of the CIO will be “transformed from the technology expert of yesteryear to that of a business engineer who is pivotal to the strategic growth of the enterprise”. However, CIOs haven’t cemented their place on the board just yet and many are still occupying an operational position, despite the rising value of technology to the modern business.

So how do professionals get to where they want to be? CIOs need to think long-term, add value and be able to help their business expand if they’re to operate at a strategic board level. A crucial part of this for CIOs is making the priorities of the board their priorities. With 51 per cent of chief executive officers telling PwC in the ‘Dealing with disruption: Adapting to survive and thrive’ report that the customer will be in their top three investment priorities for the coming year, it’s clear CIOs need to be able to contribute to the customer experience if they are to demonstrate their strategic worth.

Adopting the right enterprise resource planning (ERP) system can help CIOs have a positive impact on the customer journey and growth. While ERP hasn’t traditionally been seen as a front-office piece of software, innovative IT professionals are identifying ways to find new uses for the technology and freeing it from the back office.

An IBM study recently found that more and more CIOs are being guided by the customer. Indeed, over 60 per cent claim they will focus more heavily on improving the customer experience and getting closer to the consumer. More than 80 per cent said that they are putting a greater emphasis on the front office and are investing in new technologies to gain deeper insights into customer data.

Getting Value From Data

Aberdeen Group’s ‘Customer Service Analytics: Exploit Data to Improve the Customer Experience’ report showed that companies that have customer service analytics have superior annual improvements across key performance measures.

Those with analytics had 72 per cent greater year-over-year customer retention growth rates, compared to non-users. Additionally, service organisations with customer service analytics had 19.7 per cent annual improvement rates when it came to win-backs. This all translates to improved financial performance. “Customer service analytics users enjoy far greater year-over-year gains in key financial measures, such as cross-sell and up-sell revenue and customer lifetime value,” Aberdeen Group explained in their report.

Using an ERP system, it is possible to mine structured feedback (data that is organised in a pre-defined way) and unstructured feedback (data that does not follow a pre-defined structure, such as social media). This business intelligence can be embedded in the system to improve decision making.

Among customer analytics users, 72 per cent use this data to design or enhance customer-centric products and services. IBM research suggests this may become more popular, with two-thirds of CIOs now exploring how to collaborate with customers using cloud computing and social networking hubs. This will create masses of unstructured data, which will need to be run through an ERP system and analysed.

Supporting Commerce

ERP systems can also help support the transaction process. CIOs can manage customer service portals, supporting customers when placing orders, viewing stock, managing accounts, tracking orders, raising issues and updating information online. This helps to enhance the customer service experience, especially when it comes to e-commerce. With more and more transactions taking place online, CIOs that can help to grow this side of a business will be able to demonstrate their ability to add value in the changing business environment.

Improving Payments

ERP systems can be used to improve payments by integrating the back and front office and setting up alerts to ensure money is taken on time. Aberdeen Group explained in its ‘Grab the low-hanging fruit’ report that 63 per cent of best-in-class companies have integrated their front and back offices using ERP systems. Deloitte claims that, by taking advantage of new payment systems, bottomline savings of up to 7┬áper cent can be achieved.

Solving The Board’s Problems

In order to be seen as strategic and drivers of growth, CIOs need to demonstrate that they can solve the problems of the board. ‘ERP in retail: A one-stop shop for customer satisfaction’ explained that 45 per cent of companies are suddenly suffering from inadequate business systems, while 31 per cent have an inability to collaborate with the extended enterprise.

By implementing the right ERP system, CIOs can make this a thing of the past by ensuring robust IT infrastructure is in place that runs everything through one system. This helps to drive efficiency and allow cross-organisational collaboration. Aberdeen Group observed that leading retailers are 50 per cent more likely to have the ability to share and integrate data with the extended enterprise. CIOs that can address the pain points and simultaneously grow the customer base will likely find they soon get a place at the top table.

Jayne Archbold (smaller file)

Jayne Archbold is CEO of Mid Market Europe and CEO of Sage ERP X3 worldwide. Jayne has been at Sage since 1997 and has held senior positions in all Sage UKI divisions: SSB, SMB, Accountants' and Mid-Market. Prior to joining the Sage Mid-Market Europe, initally leading Strategy and Corporate Communications, Jayne held the position of MD for Sage Mid-Market.