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Through my consulting career I have had to ask myself what, if anything, each new acronym offers. With respect to CRM it occurred to me (slower than I would like to confess) that there was something simple yet powerful about this shiny new acronym - the word 'customer'.

All the acronyms we have worked with to date and their underlying philosophies are aimed at improving performance within the organisation. Helping organisations to do what they were already doing but more efficiently and/or effectively. Yet working with organisations to improve what they did and helping them do it faster and more cheaply never really put the customer at the core of the work. We did not consciously consider if the right things were being done, for the right people or groups of people, in the right way and at the right time.

The starting point for CRM, has to be consider what the word customer and the term CRM itself means for your organisation. For a charity, the customers are the beneficiaries, donors, sponsors, associated organisations, the public, the media and members. Traditionally the word customer was almost an expletive in the voluntary sector. However increasingly the term is gaining acceptance as the sector is prepared to learn, with appropriate adaptions, from the experience of the private sector.

So what is CRM? Is it really so shiny and new? No. CRM is about taking 20 years or more of organisational theory and practise and making it customer-focused. It is about taking a 'customer centric' approach, to strategy, business process, organisational culture and structure, IT specification and selection, leadership and everything else your organisation does. Well before CRM was born, Tom Peters in 'In search of Excellence' (1982) spoke of excellent companies having a 'seemingly unjustifiable obsession' with some form of service, reliability or quality throughout the organisation, not just within the sales team. An organisation with effective customer relationship management would have every member of staff, and indeed volunteer, being able to answer the following question for everything they do - who is my customer and what am I providing to them that is of value?

It is also useful to consider what CRM is not. CRM is not about information technology any more than marriage is about a wedding. You cannot just slap in some technology and hope the lifetime of the relationships with all your customers will be perfect. Equally neither is it about simply establishing a call centre or something similar.

Laying out a general recommendation as to how you might approach CRM is not rocket science. Making it work for you and successfully implementing it, on the other hand, is arguably a mixture of both fine art and rocket science.

The place to start is with what your organisation is aiming to achieve: vision, mission, core purpose - whatever jargon works for your culture. Whatever it is, the core purpose must be at the core of any CRM initiative. Following this, and only following this, you need to get clear on your customers requirements, answering such questions as: Who are they? How are they grouped or segmented? How do their needs differ? What are their relationships with each other and with your organisation? In the voluntary sector these relationships can be very complex.

A company provides goods or services to a customer who provides money in return. However, in the charity sector donors give money to the charity which in turn uses it to research, fund projects or supply goods and services to beneficiaries. Of course some or all of the money may come from government grants or contracts.

This leaves voluntary organisations often caught between different expectations of funders and service users. These 'customer' relationships are further complicated by the fact that individuals, organisations or groups may be all at once service users and funders.

It is exactly due to these complexities that CRM is crucial to the voluntary sector. Fundraisers tend to focus their energy entirely on donors, seeing them as the main customers. Operations on the other hand focus their efforts on beneficiaries as the main customers.

The result is an organisation that's almost literally being pulled in two directions. So in answer to the question what has it got to do with fundraisers, the answer is loads.

Considering donors as customers, looking at how they are segmented and what are their needs and values is the bread and butter of fundraising. CRM takes a larger view and considers donors as one group of customers of the entire organisation, not just the fundraising department. It looks at managing their needs along side those of beneficiaries and other customers. Nine times out of ten, adopting a CRM philosophy will result in clearer organisation-wide definitions of customer and a focus on improved cross-functional working.

Once you have established who your customers are and what are their needs, it is time to think about how you are going to measure your ability to provide for all those needs. Measures or key performance indicators, or however you wish to label them, are some of the most poorly used business tools.

Once particularly bad example for measuring the success of a call centre was the number of calls taken per hour - which does not actually indicate much at all about the success of the centre.

It is crucial to define measures which actually track what you are trying to achieve as an organisation and how your improvement initiatives have helped or hindered this.

Only once you are clear on where the organisation is going, what the customers require and how this might be measured, can you begin to think about the implications for the organisation - what do you need to change to achieve the vision in the most effective and efficient way? What this means will differ largely from organisation to organisation.

For some organisations it may be that a cultural shift is required, moving to a customer focused culture from a culture of "I am just doing my job". For another organisation changes may be required in many other areas, such as business processes, organisational structure, leadership, communication mechanisms, training and staff development and information technology.

Following the introduction of appropriate organisational changes, you should rest on your laurels and congratulate yourself for a job well done! Or not. CRM is a business philosophy, not a piece of technology, training course or new call centre. Hence although there may be a definable end point to a CRM project, the philosophy should be ongoing. The measures established during the project should be constantly reviewed and updated, the dialogue with customers should always remain open.

Head to the search engine www.google.com and type in 'CRM failures'. For this you will need several days and a few packed lunches to plough through all the information you are bombarded with. By following some of the links you will notice that the failure statistics seem to range upwards from 50 per cent.

Why are there so many failures and if there are why are we still doing it? Look a little deeper and between the lines, many of the reports and case studies are actually talking about implementation of information technology that has been branded a CRM project. This is asking for failure.

Another very common, but avoidable, mistake is not getting clear on what you are trying to achieve from day one - "what do you want, what do you really really want" from CRM.

Many reasons why CRM initiatives fail are similar to those for projects from any of the fads in the last 20 years.

Mostly people do not like change. People especially dislike change when they are not involved in the process and cannot fathom how it will benefit them. Involve staff and customers in the process; manage their expectations and concerns.

Politics, especially between departments and around who owns the customer, should be factored into to any CRM initiative. Implementing new systems or culture change and ignoring existing inefficient business processes will also increase the risk of failure.

If your initiative requires new technology to enable it, this must be carefully chosen. Get clear on your requirements before approaching suppliers. The danger if you don't is you will be sold to rather than being an informed customer who can select a system based on its match with your culture and detailed business requirements.

So yes, CRM is big, very big. It is an entire philosophy. It is constantly asking how do you move to doing everything that you do, everywhere in your organisation in the best possible interests of our customers.

Get started, get a cross-functional team together and talk about it. Consider what CRM could mean for you. Ask where you would like to be with respect to your customer relationships. Get help if you need it. Remember customer relationship management is not synonymous with information technology anymore than sitting at your desk is synonymous with working productively.

Rachel Percy is a consultant with Horwath Consulting.

This article first appeared in Professional Fundraising (October 2002).