Guest Post: Managing Your Customer Reference Program with a Specialized Application or a Spreadsheet

This week, we’re honored to share a guest post from Joshua Horwitz of Boulder Logic:

With tightened budgets all around, this is the most common question we hear: do I need a customer reference application, or will a spreadsheet for my reference program be enough? To help our clients make the decision, we advise them to consider the specifics of their situation and the pros and cons of each approach. Let’s take a look.

We advise starting by jotting down answers to some basic questions. What is the size of your customer base and how many referenceable customers do you realistically foresee? If you really won’t be expanding beyond a couple dozen or so reference customers, the challenge of keeping track of everyone’s activities is more limited. What is the size of your sales force? Organizations with more than a handful of team members, particularly if they are geographically distributed, tend to struggle more when tools and processes are informal. What is your vision for your customer reference program? The complexity of everything increases as you expand the activities you support, serve more stakeholders, or attempt to provide a more consistent experience for your customers and prospects.

While your initial plans may be modest, we recommend thinking several quarters ahead. It’s much harder to build a new IT justification or reset stakeholder expectations down the road. Too often we see customer reference program managers unable to expand and evolve their program because they’ve become hostages to a process filled with manual tasks that didn’t seem overwhelming earlier.

With the points above in mind, let’s look at the pros and cons of spreadsheets compared to a formal customer reference application.

Spreadsheets

A spreadsheet is a simple and affordable way to organize any information. You need no special or expensive technology. You can immediately create columns for tracking information. Changes are also easy. No formal training is required. Individuals familiar with pivot tables and more advanced formulas and functions can set up ways to count, analyze, and create charts for the basic reference program information.

On the downside, spreadsheets are designed for numbers and small amounts of text, and don’t do well with more complex, descriptive data. For example, you can add a row for a customer and information about the multiple products they use, but trying to show information about how they use each product can get complex or require another spreadsheet tab. Over time, spreadsheet complexity and the resources required for maintenance increases exponentially.

Spreadsheets are also not well designed to have multiple contributors, leaving the accuracy and availability of information dependent on a single owner who soon becomes the bottleneck. We frequently hear complaints from the person in this role because their ability to contribute to higher value tasks takes a backseat to trying to keep up with information requests. Ultimately this also affects program growth and adoption.

Spreadsheets provide powerful tools for analytics, but all of the data being analyzed must be entered and maintained manually. If you want to capture details about reference usage, revenue impact, and program adoption, details of each activity must be entered and updated by hand, adding to the overall costs of managing your program.

Customer Reference Applications

A customer reference application is a tool designed to automate a lot of the manual tasks specific to a customer reference program. For instance, some applications allow automated notifications and tracking of workflows that would otherwise require emails, phone calls, and a lot of manual record keeping. This helps everything go faster, improving the experience for your sales people, but also for your prospects and customers.

One of the negatives of an enterprise customer reference application is the additional thought and planning that is necessary for a successful rollout. While good vendors are available to help, delivering training on a new tool is important and should be considered. On the other hand, if your process is not more than an email alias where people send all their requests, then training is less of a factor.

Perhaps the biggest con of a customer reference application, as with any IT investment, is the cost and the effort required to secure approval. It is often an effort to effectively communicate the value of an upfront investment in customer reference management, even when a thoughtful justification shows a short payback period.

Once secured and deployed, other advantages of a customer reference application become evident. A customer reference application is built for collaboration. You can invite a variety of contributors to help in the recruitment effort and self service access can be provided where appropriate. Different groups can be given access and have the ability to interact with the information in different ways. Your program gains credibility as the needs of new stakeholders are satisfied.

Information can be organized more intuitively in a customer reference application. Relationships between forms can be used to collect a complete picture, and a considerable amount of information is tracked as the application is being used without any manual entry. For example, the frequency of requests and duration between each step in the process are recorded without any manual effort.

One of the most important advantages of having an application is the information it provides about the program itself. It can help to identify areas of success and weakness so you can focus efforts appropriately. For instance, you can see the gaps in your portfolio, the time it takes for requests to be fulfilled, and even the criteria your stakeholders use to search for references. This allows the program manager to spend time on the most productive activities.

Conclusion

Revisit the questions posed at the start of this article. Really try to understand your situation today and your goals for the near future. The best approach to your infrastructure is whatever will allow your organization to realize the benefits of a customer reference program. Understanding the best practices of each approach, and knowing the pros and cons of the different technology available will allow you to determine what you need to be successful.

Joshua Horwitz is the founder and president of Boulder Logic, a company that specializes in customer reference management. For more information, go to www.boulderlogic.com, He also blogs at ReferenceSuccess.com and on Twitter at @boulderlogic.