C Stands for Citizen

Forget the airlines and casinos. By 2006, the largest purchasers of CRM technology will be governments offering health and welfare services.

That prediction, made in March by Gartner Inc.'s John Kost, is based on the fact that stuffy government bureaucracies are increasingly using call centers to offer greater convenience to their constituents.

In 1999, for example, Chicago consolidated 150 city government phone numbers into one 311 number, according to a special report by American City and County, a sister publication of Direct. The 311 call center has a staff of 55 service representatives and handles 3.5 million non-emergency calls per year.

What's the benefit?

“Our initial goal was to consolidate phone numbers and to take some of the volume from the 911 center,” Chicago's chief information officer Christopher O'Brien told American City and County. But the city soon realized that it was “building an enterprisewide work-order management system.”

Baltimore also started up a 311 number that year, and several other municipalities are in some stage of filtering incoming calls through a triage process and practicing what Mark Amtower, partner in consultancy Amtower & Co., refers to as “citizen relationship management.”

The trend started with Al Gore's report on national performance in 1993. The last election, in which 24 new governors were elected, will only hasten the process, according to Kost.

“Suddenly a whole bunch of politicians just came in for the first time,” he said, speaking recently at Gartner's spring CRM Summit. “They got billion-dollar deficits, citizens are pissed off. The question they ask themselves is, how do I improve service in an environment where I have no money?”

Why call centers and not Web sites? Because many government CRM users are involved in case management.

“They're protecting the poor, disabled, elderly and illiterate and those who are plain clueless, to be perfectly crass,” said Kost. Internet penetration in those groups is less than 10%, he added.

But CRM isn't only being embraced by social welfare agencies. According to press reports, the U.S. Postal Service awarded Convergys Corp. a $255 million contract to outsource its customer contact network. And the IRS is making a major effort to show a friendlier face to taxpayers.

Kost suggested that agencies use a tiered approach for handling calls, referring the more complicated ones to specialists. “As volume goes down, complexity goes up,” he said.

But where does it go from here? Kost suggests that governments pool resources and set up one number for everyone. For example, the IRS and state tax agencies are increasingly sharing data. And the states and feds cooperate on law enforcement.

“There's enough commonalities in these verticals to look at doing things differently,” he said. “With one number you could handle all case management, from Social Security to welfare, and through all jurisdictions of government. And it would be a heck of a lot easier than trying to do it horizontally.”

But Amtower disputes that. “There are 80,000 governments in the United States,” he said. “One phone call ain't gonna do it. (He added, “Wouldn't you love to be the telemarketing firm that gets that account?”)

And there are several other problems, one being that governments at all levels are strapped for cash. Many are taking halting first steps at best.

Moreover, Amtower, whose company helps B-to-B firms market to the government, questions Gartner's findings on spending levels. “This year, the government will probably spend more on CRM because nobody else is spending anything,” he remarked.

Finally, critics wonder whether citizens really want multiple governments sharing data on them.

“That's the most commonly asked question I get,” said Kost. “Frankly, there isn't an easy answer. Even if you've solved the technical problem, have you solved it in a political sense? It's an education process.”

He added that security and privacy seem to be less of a concern on the local level.

And American City and County reported that cities are providing better and faster service thanks to their 311 numbers. Take Dallas: “By picking up the phone and dialing 311, residents can report a pothole in the city, find out where to vote or even get help with a business license.”

Amtower concluded, “It's been going on for 10 years, so I guess it's a trend, not a fad.”