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How we could turn centralisation on its head

“How do we fix CRM?” is a dull-sounding question to which the interesting answer is “By turning it on its head.” I had an fascinating and challenging encounter last week in London with a group exploring Doc Searls’ Harvard project called “vendor relationship management” (VRM).

Don’t worry about the VRM name for now, but consider the “Ideal Government implications of the idea (here’s a transcript of my rough notes).

VRM is a service, accessible to all participating people. I choose to call them agents, since they’re active, not supine, and I want to avoid words like customer, citizen, subject, prisoner etc. I’m not talking about “them”, but about “us”.

VRM helps us agents make better decisions and implement them better. It lets us harness tools and the power of the contemporary net (that which we shall not call Web 2.x)* to manage our lives better. We use it to share information about suppliers and service providers and invite or (as our confidence grows) tell them how to meet our needs better. And we use it to make the transaction, disclosing the bare minimum necessary of the credentials we lodge with it.

It cuts the cost, hassle and intrusion of making and of implementing transaction decisions (whether it’s buying flights frmo the travel agent or changing address).

Sounds good, but the implication for our service providers is huge.

This was explained to me by a group including Adriana, Alan Mitchell and Iain Henderson.

VRM, they explain to me, can be described as added-value buying services, or as “solution assembly” either for ongoing processes (like managing my house, finances, car, or personal mobility) or major events (my partner dies, I move house etc).

The top-down centralisers who bought CRM (or wrote Transformational Government for that matter) can take solace in the idea this whole thing is not anti-CRM, but a way to fix CRM. CRM suggested “Make life easier for customers and they’ll buy more from us” But then it was implemented a a cost reduction, so customers get junk mailed and are held in tedious call-centre queues.

VRM opens up all sorts of new markets as people articulate their requirements. The long tail finds its voice and states its needs. It’s counter-intuitive model, and a fundamental shift in how they do business.

A good CRM system needs perhaps 700 data items about a client to do a proper job, reckons Iain, but in truth holds 300 and patchily at that. (The benighted ID System holds a more modest 60 or so). But the typical person needs perhaps 3500 data items about themselves to get through life. As ever, the people with highest need have least power and least tools. VRM lets them manage and disclose these data items in the manner that best suits them.

People fret about aggregation of data. But aggregation isnt the start point; it’s the end game.

Like “quality”, perhaps mass self-service individualisation will turn out to be cheap and profitable. Averaging out what you provide is wasteful, whether you over-provide or under-provide. Catering to individuals creates larger and more creative markets.

It supports, for example, the concept of the problem-solving community (which we would in public services call co-governance). People at a critical juncture have a finite number of issues they have to deal with. The way to develop the individualised service is to let people ask the question.

Bureaucracy 1.0 stifles the questions. But the FAQ-based approach is being piloted in education under the Teaching Development AgencyTDA with head teachers (grateful for a ref). Head teachers phone up with a problem (bullying, budgets, staff etc). Researchers give them an expensive bespoke answer, which is then available free to others.

The information generated by an individual in the course of their life is the oil of the new economy. You can’t invade the individual like you can invade Iraq.

But government still seems to think it can. If that’s the case, data and services will migrate to countries that are respectful: Canada, New Zealand, Scandinavia.

VRM is therefore an ugly TLA label for a fundamental relationship change which can encompass almost everything. it certainly encompasses public services and government, and effectively turns the assumptions underlying Transformation Government on their head (which is where those assumptions belong).

The two likeliest areas to start, Iain reckons, are health management and wealth management. But these are the two most sensitive also. In the case of health, if Connecting for Health is a sort of Stalinist CRM, then the new Healthvault (ironically form the same Microsoft that we blame for dreaming up CfH on Tony Blair’s sofa in the first place) is the VRM version: it supports the agent in managing the information and resources connected to their own healthcare management.

Other examples are the Wesabi credit checking service, garlik, or the Pledgebank which unites agents in a common cause without any central entity.

Phew. It’s a very different way of looking at the future; a technology architecture that supports the dignity and integrity of the individual agent in his or her transactions with the world. Go, Doc! Thanks Adriana!

Published by William Heath on 25/10/07 at 3:23pm

Comments

1. A writes

   The best way to approach this is find ways to empower individuals...now let’s do it with tools, stronger network and some understanding of how the people behave online.

   Reply by  on  10/26/07  at  10:54 am

2. Very interesting piece - many thanks William. Whatever VRM looks like I think that Patient Opinion - or something like it - will be a part of the action. And VRM is a very handy ‘upside-down’ way of looking at what we do.

   Reply by Paul Hodgkin  on  11/14/07  at  10:07 pm

3. Increasingly complex problem require decentralization instead of centralization.
   The rule of thumb is, pick the best guy in a field, leave him alone and let him do his best.

   Reply by Healthy guy  on  05/05/08  at  6:48 pm

Ideal Government

Let's say what we want from e-enabled government. Let's observe government first-hand. Let's say "Wouldn't It Be Better If" (WIBBI). Become an ethnographer of bureaucracy today! It beats getting frustrated with public services.

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• "What do we want?"
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