Service provider LexisNexis´ acquisition of CRM specialist Interface Software in late 2004 was an important bellwether: CRM will now be heavily marketed to professional service companies. Firms with a large client base should take notice, while firms servicing a small client base must beware technology overkill.
LexisNexis and CRM
LexisNexis has become the predominant information service in the professional services industry. In the past two years, the company has focused on developing products that can help its clients find, attain, and retain customers. These products include Martindale-Hubbell, which is a directory of information on lawyers and law firms, and CourtLink, which enables attorneys to access court docket information, sometimes before their clients even know they´re the subjects of litigation.
Given the company´s recent focus, the integration of a CRM solution into its product offering is not a surprise. By combining the relationship intelligence capabilities of the Interface CRM platform InterAction with LexisNexis content, the company can deliver customized client development solutions. Armed with this information, a relationship-based firm can enhance client service and differentiate itself from the competition by:
- Increased knowledge worker productivity. Revenue earners have easy access to the information they need to focus on client retention and satisfaction.
- Improved marketing initiatives. Drawing client information from a centralized source will enable marketing teams to manage the firm´s new business development efforts more efficiently.
- Faster data entry with improved data quality. Administrative personnel have an easy-to-use interface that enables easy data entry and maintenance.
Analysis
LexisNexis is the market-leading information service provider in several professional service verticals. We expect the company to leverage its traction and attempt to push its CRM solution into both small- to mid-sized firms as well as large firms.
Although professional service firms do not generate the high-volume transactions that typically warrant a CRM implementation, they do depend on up-to-date, comprehensive client information that is quick and easy to find.
Recommendations
1. Small firms planning limited growth: ignore the hype. For most professional service firms in the small- to mid-sized enterprise (SME) market, the benefits of a CRM system will not justify the costs of implementation. In all but the most extreme cases, firms with less than 10 partners and associates will not have the IT infrastructure or the client base to warrant a CRM implementation.
2.SMEs forecasting client growth: find the tipping point. For organizations with 10 to 30 partners or associates and a growing client base, the benefits mentioned above may justify the expense of a CRM system. Find the number where the benefits of increased productivity, improved marketing, and faster data entry outweigh the substantial license and implementation costs.
3. Medium to large firms: start planning a CRM implementation. With many of the top firms in the U.S. and the U.K. implementing CRM and using it as a competitive weapon, any firm with over 30 billing partners and associates should be developing a business case. Use the Info-Tech research report Customer Relationship Management: A Return on Investment Strategy to help build the plan.
Bottom Line
Get ready for LexisNexis sales representatives to pull their new CRM system out of the carpetbag. Although CRM is not for small firms with a limited IT infrastructure, for larger firms there is an opportunity to enhance existing business issues with CRM.
