6 High Impact CRM Center of Excellence Best Practices


  • The CRM Center of Excellence (CoE) maximizes scarce resources with deep skills by centralizing their efforts and disseminating their insights, knowledge, best practices and reusable assets throughout the company.
  • The CRM CoE accelerates time to value, reach, and impact with Customer Relationship Management technologies and programs that would otherwise be out of reach. It further standardizes best practices, business processes and the consistent delivery of customer experiences.
  • CRM Center of Excellence Best Practices facilitate these benefits by sharing lessons that save time, reduce risk and improve results. They show what actions deliver results and which don't, and that helps prioritize what to do and is equally helpful in determining what not to do.
Johnny Grow Revenue Growth Consulting

Best Practices for CRM Centers of Excellence

There is no one way to create an effective Customer Relationship Management (CRM) Center of Excellence (CoE). But there are best practices that share valuable lessons of what works, what doesn't and how to maximize your results.

We catalogue Best Practices by category, and we've pulled from several categories for this post.


Start with a clear definition

If you cannot define something you are unlikely to achieve it. But there is no consensus definition for a CRM CoE so you will need to consider a few sources and adapt them to your needs.

Gartner defines a CRM CoE as "concentrating existing expertise and resources in a discipline or capability to attain and sustain world-class performance and value."

Carnegie Mellon's Software Engineering Institute defines a CoE as "A premier organization providing an exceptional product or service in an assigned sphere of expertise."

Both definitions focus on specialized resources delivering expert services.

Our own definition is a bit more specific and defines a CoE as a virtual or physical team focused on specific CRM competencies or areas of expertise to increase user, customer, and company performance results.

The point here is to define your CoE on your terms so that others don't define it for you.


Not just for big companies

CoEs are more prevalent at big companies, but the benefits and payback are no less important or available to smaller companies.

Larger companies in regulated industries often use their CoE for regulatory compliance in addition to improved application performance.

Our experience with clients is that when companies reach about $30M in revenues they can achieve significant cost and revenue improvements with a CoE. The one difference is that smaller companies may not initially staff the CoE as an autonomous business unit, and instead position it as part of an existing department or line of business.

Certain industries such as technology and professional services, and B2B companies in general, more frequently adopt CoEs. But again, the benefits and payback are no less relevant in other sectors or for B2C companies. The primary difference is that consumer industry companies place less emphasis in the sales force automation and much more emphasis in the marketing cloud.

The bottom line is that CoEs apply to companies of all sizes and industries.

Rather than focus on firmographics, the case for a CoE is better identified by the need to apply specialized resources with deep skills to achieve significantly improved technology performance that is otherwise out of reach.


The operating model defines the breadth and depth of your success

A CoE operating model defines a structure for people. There are many CRM CoE operating models. Each has its advantages and disadvantages. But comparing them in an effort to select the best one is not really the point.

That's because CRM Center of Excellence research shows that the top performers adopt different models over an extended period and in a progressive sequence where each new model delivers higher revenue contribution and technology ROI.

Center of Excellence Operating Models

Companies normally begin with a centralized model. It requires less budget and it is simpler and faster to stand up.

After experiencing initial success, CoEs seeking increased results advance to a hybrid model. That leaves strategy, foundational services and governance with the central CoE but begins to push expert skills closer to the marketing, sales or customer service business units where they can be applied. And that improves the business unit's performance results.

The final move is to a federated model which continues to exercise centralized control but replicates many or all specialized skills within all or most of the business units for the maximum impact.

Selecting the best CoE operating model is a point in time decision that shifts with maturity.


Talent management functions are imperative

Recruiting, developing and retaining technical talent is no easy task, but is critical to success.

CRM software experts are in high demand, so they are difficult to find, costly to hire and require continued investment for learning and development. They are often approached by headhunters and other companies so that investment will be lost if they leave.

Even small increases in CoE staff turnover will result in big expenses that can ruin your ROI.

Active coaching, continued training, stimulating challenges, diverse projects and frequent recognition are your top staff retention tools.

Retention can also be improved by seeding the team with tenured staff from other parts of the company who demonstrate enthusiasm for the role and a propensity to learn.

Some of our clients perform periodic rotations of sales, marketing or customer service staff into the CoE. That broadens their skills and sometimes identifies strong candidates for permanent positions.

We have other clients that perform periodic competitions whereby they assign problems and invite interested candidates to present solutions. Some of those candidates may be offered part-time or full-time roles in the CoE.

It is also a good idea to maintain a skills inventory. This tracks existing skills to help assign the right resource to the right task and is also used to schedule the most relevant learning and development programs. It can also be used to forecast the future skills needed to pursue planned business objectives.

The best practice here is to work with your Human Resource department to adopt the formal talent management practices that will improve recruiting decisions, increase employee engagement, lengthen staff tenure and achieve high performance results.


The CRM CoE should be the change champion

Charles Darwin first discovered that, "It is not the strongest or the most intelligent who survive, but those who can best manage change." That’s a valuable lesson for the CoE.

Adapting to changing customer behaviors, leveraging new technologies, outpacing nimble competitors, or shifting to a growth culture all reinforce that business change is constant, and therefore can and should be planned for.

But many times, CoEs believe the mandate for change stems from elsewhere in the company. That’s a missed strategic opportunity.

Change can be followed or led. If followed, challenges from change come as a surprise. They are often initially discounted or dismissed. But change resides within your users and customers and these people don't like to be discounted or dismissed. That will not make the challenges go away.

The challenges grow, deteriorate the CRM mission and ultimately take time and resources away from the mission.

If led, change is proactively addressed with business agility, software extensibility and a change management program. Challenges still occur, but they are addressed early and remedied before they consume time and resources and negatively impact the mission.

The best practice here is for the CoE to lead change. That means embracing and leveraging new user and customer behaviors, market shifts or changes in the way work gets done.


Define your governance

Most people understand that governance is needed to maintain the right course and demonstrate accountability. Fewer people understand how to structure an effective CRM CoE governance program. It's a 3-step approach.

First, define your constituencies. That's often a 3-tier model consisting of a steering committee of cross functional stakeholders, a CoE management or leadership team, and CoE constituent representatives from the broader user community. You can then define responsibilities for each group.

CRM CoE Governance Hierarchy

For example, the Steering Committee ensures the governance model is working and reviews the performance reporting which links investments to payback. Their primary interest is to make sure that the CoE program and CRM software are evolving in concert with the company’s business strategies and in a way that continuously applies technology to drive the most important user, customer and business outcomes.

The members of the user community are often a representational peer group that act as proxy to the wider user community. They provide a channel for users to be heard. They are responsible for continuous improvement of the application.

To do that, they bring forward community feedback in the forms of ideas, process improvements, new capabilities, software customization requests, integration requests or additions of third-party software. They generally catalogue their ideas and those with the highest value are submitted to the CoE.

Sometimes members of the CoE team and user community consist of a mix of permanent and rotating members. Other times, one of these two groups may also act as a Change Control Review Committee which evaluates certain high impact actions or projects proposed to the CoE.

The second step is to create a meeting cadence for each constituent group. You will want to meet more frequently in the early days and can then relax the meeting rhythm as things stabilize.

And third, define the information reporting for each group. This will include a combination of agile artifacts, performance metrics and financial measures.

It's important that reports to the steering committee are not based on application activities as the steering committee is looking for direct line of sight between the CRM CoE investment and financial results.