Corporations are spending millions on customer relationship management (CRM) software and consulting. Yet, poor quality customer data can render those CRM efforts useless. Companies often mistakenly believe their data are in good shape. We've seen that confidence often is unwarranted. Bad data can assume many forms inside a company's records. Outdated information, for example, such as old addresses and phone numbers, is a common problem. Without continuous maintenance, data quality quickly degenerates. Many industry experts estimate that 2% of a list becomes obsolete each month because of death, divorce, marriage or a move. Some customer data are simply incorrect; in many instances, employees or customers have mistyped information into a form. Often, the more individuals who handle a piece of information, the more susceptible it is to incorrect entry. One misinterpretation of a customer's handwriting on an application can leave a legacy in a CRM system unless it's caught during contact with that customer at some other touch point. Bad data can also arrive incorrectly formatted, which can affect thousands of records at a time. Merging disparate data sources within a company, employees can find phone numbers in a dozen different formats. Worse, an overly conscientious programmer may not allocate enough space in a database field for complete information. I receive information from my mortgage company each month addressed to "Jeremy Bachm." After looking into it, I discovered it's because my full name has too many characters for the amount allotted in the company's database field. Finally, redundant data inside a company can hamper a company's CRM efforts. Multiple records often exist for the same customer inside a company. Joint accounts and the inclusion and exclusion of middle names can create several records for essentially one customer relationship. Directly and indirectly, bad data cost corporations millions of dollars each year. On the surface, companies spend money on unnecessary printing, postage, and staffing. Furthermore, the inability to make sound decisions from the data hampers executives. It's "garbage in, garbage out"-bad data make expensive CRM systems useless. Most important, perhaps, is the erosion of credibility with customers and employees. Customers can sever a relationship if they see that after years of doing business you still do not know who they are. Inside the company, employees will avoid using expensive CRM systems if they believe the information inside is unreliable. What can a company do to solve the data dilemma? EBGroup offers the following tips to get started: Clean up what you have. Start with the information that already exists in the company. Start small, perhaps with a subset to identify larger issues. Look for patterns in technical support requests to your customer service department. Often a few customer complaints may reveal a larger problem that hundreds of customers have not encountered yet. Identify organizational issues that impede data quality. A bank or insurance company might have over 100 systems that gather customer information. In those cases, consolidating the number of databases where possible can reduce the potential for error considerably. Culturally, departments may refuse to share information with each other. Rivalry and fear of overmarketing are two reasons this may happen. Remind departments that the customers view the organization as the provider and may have little to no awareness of departmental distinctions, however prominent they may be within the company. Prevent more bad data from entering company records. Avoid the urge for "open entry" fields on systems, unless necessary. Without a dropdown menu on a screen, for example, California can look like "CA," "Ca," "Calif.," or "Californa" and add many hours to a data cleansing project. Furthermore, data errors and deliberate omissions come from forcing users to register just to find out basic information. This common practice can irritate customers. If they're not ready to tell you about themselves, they'll enter anything just to get to the next screen. A frequent visitor to a lot of Web sites seems to be Mickey Mouse. Validate every minute of every day. At every customer touch point-branch, phone, web, or mail-try to insert naturally the validation or addition of customer information. Confirm a phone number or address. If an email address field is blank, ask if the customer would like to receive product and service information via email.

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