Building CRM Business Cases with Real Options

An interesting academic paper was published back in 2005 called “Using Real Options to Help Build the Business Case for CRM Investment” (h/t Graham Hill for sharing it with me a few years back). This is seriously cool stuff and I urge you to follow the link and explore the embedded case study. I’m going to summarize the first part of the piece here so you can get a flavor of it. It’s not going to be easy stuff, if you have no background in this kind of analysis. Nevertheless, it’s a pretty fascinating perspective on building business cases and I recommend anyone in the CRM space (or any space for that matter) to read it a couple of times, and let it sink in.

Just so I don’t mess it up, I’m going to quote the abstract verbatim:

“While CRM (Customer Relationship Management) practices are being adopted widely, research suggests that most CRM programmes fail in their dual objective of creating superior customer value and increasing profits for the firm.

This article questions the basis on wh…