How to Use CRM as an Innovation Management System


  • Innovation is built by solving customer problems. Building your innovation management system on top of your Customer Relationship Management application creates powerful synergies and simplifies technology.
  • The innovative process is not prescriptive but follows known patterns that can be repeated. It benefits from a framework that applies technology to replicate processes and best practices. CRM software is ideally suited for this purpose.
  • Your ideation and problem solving are only as good as your customer intelligence, which resides in your CRM system. The ability to access, model and manipulate customer intelligence by multiple dimensions will improve your results.
Johnny Grow Revenue Growth Consulting

Innovation is improved with an innovation management system to prioritize ideas, track prototypes, forecast market acceptance and measure program success. You could create a custom system or acquire a third party app, but a better idea is to append your Customer Relationship Management application.

Innovation starts by finding problems that matter, and then improves or creates products or services to resolve them.

The single best source to find the problems that matter is customers. That's why CRM can help. It's the customer system of record. And when correctly implemented, it manages all customer information in a way that can surface data to identify the most important problems that would benefit from innovative solutions.

It also has the tools to engage customers and learn how to create better products and services. We're in the age of the social customer. Customers will tell you what they want, and how to improve your products or services, if you ask them. Companies can use their CRM software to collaborate with customers during product design, manufacturing, distribution, sales, service and returns to create more valuable products and services.

The Johnny Grow Innovation Framework can use CRM software as an innovation management system to help clients build better products and services. It's a replicable process for others. Here is a summary of how we do it.

CRM Innovation Management System

Append the Account Record

We first append the CRM account model for downstream innovation use cases. Customers are not homogenous so they must be grouped into customer segments for precision. We also add fields to bring specificity to buyer personas, the Ideal Customer Profile (ICP) and the 5 types of buyer insights for each persona and segment. This data rolls up so we can display exactly why and when each type of customer chooses to purchase a product; and why and when they don't.

Ideal Customer Profile

The above diagram shows how an ICP can apply data to measure and segment customers by fit. Data can cluster or group customer characteristics, attributes or behaviors to show the highest fit customers and their contribution to the company. You can then bring more precise measurability to things like purchase volume, profitability, customer lifetime value and tenure. These measures will be needed when it comes time to forecast market viability for proposed new products or services.


Enrich Customer Data

Next, we may need to enrich the customer model with data that can be used for ideation purposes. We use CRM tools to continuously gather customer input, problems and feedback. We use CRM software capabilities such as Voice of the Customer (VoC), social listening, crowdsourcing, speech analytics, conversational marketing, conversational intelligence and other tools to automatically capture and route the right data to the account model. Below is example of how we use VoC.

Voice of the Customer Data Transformation

For some clients, we use bots and virtual agents on the website or social channels. These tools can capture data from visitors and prospects who are not customers and thereby greatly expand the data set.

There is no shortage of tools to help acquire, analyze and apply customer data. Based on our experience in working with clients we categorized many of the more useful tools in the below grid.

Voice of the Customer Tools

We also get important insights from CRM transactions. We have built routines that filter and extract transactions such as help desk tickets, campaign conversions and lost sale opportunities. All of these transactions are used to add more customer intelligence to the ideation model.


Make Sense of Customer Intelligence

All this information needs to be easily visible so it can become actionable. To this end, we architect the CRM app to categorize the data, make it available in the places where it can be applied and make it accessible as an innovation management system. When the customer data is easily viewable and accessible, we have Customer Intelligence.

Customer Insights Integration to CRM

And one more thing at this step. Account data for the model must include at least one dimension for monetization. It's needed to calculate profit propensity and market opportunity for solutions that solve customer problems. However, CRM systems generally don't have financial fields such as customer profitability and customer lifetime value (CLV), so you will need to add them.


Create Your Ideation Model

Now we can create a meaningful Ideation Model that surfaces customer problems for solutioning consideration. Many of our clients refer to this as their innovation management system or app. The model can be created in CRM as a custom object and then the customer data that defines problems to be solved can be automatically harvested, tabulated, weighted and prioritized.

The results are improved when using Artificial Intelligence (AI) algorithms to filter, sort and prioritize customer input. AI can re-rank the most appealing opportunities and then calculate an ideation scorecard.


Solution with Design Thinking

The Ideation Model will surface the top ranked problems that are then ready for solutioning. There are a few solutioning options but one that works well is a Design Thinking workshop. Design Thinking is the fastest and most effective method to identify the most important and highest impact customer problems and the new or improved products or services to solve those problems.

Design Thinking Workshop

Design Thinking generally concludes with Hills and Playbacks that are ready for prototyping. Customer intelligence is again used for the customer acceptance measurement scale. You need this scale to know when a prototype is done and ready for market introduction.

In the below example, the prototype is ready for production when it crosses the Chasm marked with the dotted red line. Each of the pyramid layers have a measurable definition that is applied to each prototyping cycle.

Innovation Prototype Chasm

Dashboards & Analytics

Finally, we create dashboards to bring real-time visibility to the most important key performance indicators (KPI) and predictability to the innovation prototyping process. Prototypes must be continuously measured to show quantifiable progress. However, measuring progress in a vacuum and without connection to a calculated commercialization is a fool's errand.

The best innovation dashboards permit real-time predictive modeling to show how changes in customer assumptions, buyer insights, price elasticity, market supply and other key factors impact customer acceptance and market adoption. It's this level of reporting that shifts the dashboard value from delivering bad news too late, to delivering the foresight that prevents bad news.

Innovation Prototype Dashboard

The reason CRM software should not just be your customer system of record but also your innovation management system of record is that the tighter the integration and correlation between customers and innovative solutions, the more likely those solutions will solve the most important problems and achieve the biggest market success.

See how to use CRM software as an innovation management information system to prioritize ideas, track prototypes, forecast market adoption and measure program progress and ROI.

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