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Potential barriers to the implementation of computer-aided direct marketing systems.

Potential Barriers to the Implementation of Computer-Aided Direct Marketing Systems

Summary

Many firms have started to introduce computer-aided direct marketing systems to reduce costs of selling to the small customers, small accounts, or regular customers re-ordering their products or services. This article reviews a series of problems that occur in installing these kinds of systems. It is based on both formal interviews and first hand knowledge of 15 firms presently engaged in either testing or fully utilizing such systems.

This article provides, first, a framework for classifying problems which arise during installation of new systems. Three major categories of potential barriers to successful introduction are identified in increasing degree of difficulty and importance: technological, human, and organizational. Second, the article discusses the contexts in which these problems occur. Third, it proposes how best to address each of them.

Surprisingly, such traditional indicators of the future behavior of a firm as its industry, size, and style of doing business do not add to the ability to forecast which of the potential problems will occur, at what time, and with what intensity within a given firm. The other consistent finding revealed that some of the problems would in fact occur, and, more importantly, once they had occurred they must be dealt with expeditiously. If the problem festered, the entire system implementation might be jeopardized.

The article concludes by stating that the only direct path to successful implementation of computer-aided direct marketing systems lies in clarity of purpose.

Introduction

When Davetta Bills, a director of direct marketing at a major telephone company, signed the order for her first computer-aided marketing system, she had high hopes. She and her management were confident that the system would pay for itself within six months and that the promise of higher productivity would translate into immediate increased profitability and a significant increase in the size of their direct marketing center. In addition, she expected that by linking her system to the remainder of the company's billing and order entry systems, she would significantly decrease problems in customer relations which seemed to have become a perennial issue. Furthermore, there was a significant public relations value to the new system. Installing it would demonstrate to customers and the company's own regulators the marketing department's commitment to progress, not a small benefit given the losses the company had incurred in recent years.

Bills signed the order three years ago. Today, however, her attitude has changed dramatically. The new system has not improved productivity as well as expected, and it has become in the opinion of many an expensive way to write orders and put them into "the overall company system." Furthermore, everyone in her marketing department has a different reason to explain what went wrong.

This story is not an isolated case of a computer system gone bad, or of poor implementation. It illustrates more broadly a far more significant point. Many companies have installed new computer-aided marketing systems, but few have realized the benefits promised by vendors of those systems. At the same time, vendors point out that customers must also share responsibility for failures. On closer inspection, it becomes obvious that companies need to overcome a number of potential barriers to implementation before these innovations are successfully introduced. Until successful adoption of this kind of innovation becomes much more the rule than the exception, as it seems to be today, companies will continue to be reluctant to adopt it.

The basic premise of computer-aided direct marketing is that it aids in telemarketing; that is, selling over the telephone. It assists in the selling process on two basic levels. First, it helps the salesperson who almost always uses the telephone as a means of reaching the customer to facilitate delivery of the basic message about the product or service, handle customer questions and objections, and record sales. In these kinds of tasks, computers are simply faster and more consistent than the manual mode. Second, computer-aided direct marketing helps the manager obtain information that, in the manual mode, he or she either could not get at all, or only could get with a great deal of difficulty. This includes such tactical parameters as efficiency and effectiveness of different direct mail pieces, sales messages, campaigns, products and services, sales representatives, and groups of sales representatives, evaluated by nearly any managerial criterion such as time, SIC and zip codes. It also includes strategic parameters such as channel effectiveness and product voids. Analyses of this kind of information often lead the manager to a broader understanding of the marketing forces operating in a given environment.

Our research consists of two to four interviews with 15 companies that have either completely implemented or undergone the initial phases of implementation of computer-aided direct marketing systems. Over the course of these observations, the author interviewed and worked closely with over 40 managers, and discussed their problems in implementation.

the size of our sample calls for a word of caution. Although the findings reported below are based upon a sound methodological foundation, these findings represent an assessment by a small, volunteer sample. Given these limitations, the findings should not be projected onto the entire market. Nonetheless, the reports provided by the respondents may be viewed as an extremely useful directional tool.

The managers from 15 companies identified many barriers to successful adoption of new technology which have been classified into three categories. The first category consists of technological barriers; that is, issues related to hardware, software, the interaction between the two, and communications with other systems. The second type may be labeled human barriers. These arise from interpersonal communication, including perceptions imposed by the employer, as well as those held by employees. The final category includes organizational barriers such as organizational structure, functional departments, planning traditions, measurements of performance, and risk-reward structures within the company.

Our paper will proceed by discussing these three types of barriers point by point. Each discussion will also include possible solutions to problems from the point of view of the managers involved in the process.

Potential Technological Barriers

Of the three categories of potential barriers, technology (i.e., lack of system compatibility) is easiest to resolve. As Min Clarkie, the manager of a start-up computer company, puts it, "In general, technical problems are easier to solve than people problems." This truism is consistent with observations used as the basis for this analysis as well as with all comments made by middle and upper managers involved in the 15 firms surveyed.

This barrier usually manifests itself as a combination of incompatibilities in software, hardware, and/or networks. As Davetta Bills observes of her company, "Our computer systems use incompatible software, sit on incompatible hardware platforms, and talk to each other only by accident." Another barrier also presents itself, which in our present computer age is surprising. In our sample of 15 companies, there are but few exceptions to the rule that at some point in any given system at least one link will consist of manual re-entry of data. For one technical reason or another, data cannot be transmitted automatically.

The major source of problems in computer systems stems from the classic conflict of two departments within most firms: the actual users of the system and the managers of MIS (Management Information Systems). Users often base their decisions about computer systems on functionality. MIS managers, on the other hand, are concerned with such issues as integrating new marketing software into the firm's existing systems. Conflicts between these two groups give rise, in turn, to two broad types of issues: genuine technical problems or potential problems, and the use of technical issues by the MIS department to maintain their control of all computer systems. Technical issues will be dealt with in this section. Problems relating to management of personnel will be considered later.

Technical problems usually arise because of the conflict between the independent development of three areas--software, hardware, and networks--and the need for these three systems to be synchronized. Such problems usually manifest themselves in confusion about names and functions of components. Generally, the solution lies in the selection of compatible software, hardware, and networks. The best computer applications for a specific job are not necessarily the best systems for the company as a whole. It is our conclusion that those systems which are adequate for a given task but compatible with the rest of the firm's networks represent the best choice. Such systems might mean higher initial costs, but the long term savings in subsequent upgrading, training of personnel and general efficiency justify the expense.

Software. A number of confusions arise in the software field. The most frequent one, however, is the simple confusion about names and functions of components. An application, for example, may be written in a third generation language such as C or Fortran. Its data base, on the other hand, will typically be implemented in fourth generation language such as Ingres or Oracle. In our sample, the vendor and the firm consistently had very different views on the preferred third and fourth generation languages as implementation environments for a particular set of applications. Consequently, maintenance of the new marketing software and its interfaces with other applications in the firm becomes an immediate problem.

The overall maintenance of the system is typically done by the vendor. Nonetheless, the day-to-day maintenance typified by in-house changes of input/output screens is a constant problem. Solutions to this problem range from "user friendly" changes in the input/output screens implemented by the vendor to the development of in-house experts on the vendor's software executed by the firm's MIS department. As Bill Stark, a direct marketing manager with a major regional bank who is fond of computers, puts it, "Either way you'll get fried; all you can do is choose your own favorite way."

Interface with other systems is usually described as "problems in file transfer." The "inexpensive" answer to this type of barrier lies in developing a neutral file system for communication. When software systems use different languages, as in the examples cited above, one can develop a third language, the "neutral" language, and still maintain communications. Such a solution usually works well with two different languages, but it often breaks down after four. In a large company, the ability to speak to four languages may not be sufficient. In addition, the "neutral languages" do not change with the changes in the languages that they provide a link for, thus they become in time their own problem. The best answer in such cases lies in translating new applications into the company's data base. It is our conclusion that the ability to communicate among all applications, and the hours of frustrations saved, will ultimately outweigh the cost of such initial translations.

Hardware. A number of issues confront the company which wishes to purchase new hardware; nonetheless, two frequently become barriers. First, one must choose from among five basic hardware platform alternatives: (1) be part of a mainframe system, (2) purchase a mini-computer, (3) opt for workstations, (4) be part of the company's existing PC network, or (5) develop a new PC network. Second, one must choose the operating system to use.

The choice of the platform is mostly a cost decision, as Mike Farland, a vice president of MIS in a major manufacturing firm, says, "I am looking for performance that will make my users happy without bankrupting my budget." Our sample agrees, however, that the trend is toward a cluster of work stations.

The choice of the operating system can turn into a major confrontation. Mike Farland calls it "a religious war," especially if anyone in an IBM shop asks the question, "Should we use Unix?"

There are no simple, clear-cut answers to these issues. Nevertheless, compatibility within the company is an imperative. In general, main frame systems should be avoided due mostly to two factors: load and expense. Inevitably, a company's computer load grows over time. Despite increasing demand, the company's order on the time-sharing list remains the same. Computer time may reach a ceiling which cannot accommodate a company's full needs. In shouldering the expense of a main frame computer system, all subscribers are liable for the cost of software, whether that software is used by individual subscribers or not. Inevitably, main frame subscribers end up paying for unused products.

If the long term, "happiness" of the middle manager who runs the direct marketing department is an acceptable criterion. The consensus of our sample calls for the department to have its own system, but to "leave all the other technical issues with MIS--they get paid to live with them."

Networks. Potential barriers in this area arise from the fact that a lack of standards in the computer networks industry makes compatibility between geographical areas difficult. There is no guarantee that within the same firm a direct marketing center in Boston will be able to communicate with an order entry system in Seattle.

There is no real solution to this dilemma except to follow the company's own standard networking system. Choices made early on must be accommodated despite the frustrations of intra-company incompatibility. Switching to a new system to conform to a customer or partner carries its own obvious penalties. "I spent hours hearing about the advantages of the Open Systems Interconnect model," Bill Stark recalls, "only to be told that my MIS group could not connect me with the computer which maintains the files on credit-risk customers because I wanted a 'dumb feature.'"

Potential Human Barriers

Human barriers arise from psychological factors that occur on either the individual, intragroup, or intergroup level and are especially apparent in a period of significant change.

Individual Level. The most frequent potential human barrier encountered on the individual level is risk avoidance. Human beings do not fear or resist change itself, so much as the change associated with uncertain or possibly detrimental outcomes. This is particularly true during a major change such as the implementation of new technologies. Often almost every level of an organization must deal with unknown outcomes; as Machiavelli said, the more uncertain the outcome, the more unlikely the success of the enterprise becomes.

At the senior level, uncertainty about the outcome translates into reluctance to take a chance on a new technology, especially in cases where senior management is not technically oriented. In these cases, senior management must rely on middle management experts or vendors, all of whom might be biased in their advice. Senior managers also rely on competitors' activities and on the experience of similar companies recounted in industry association meetings or through other informal networks. If news from these sources is positive, then managers are more disposed to experiment. As Buth Madigan, a senior vice president of marketing operations with a leading retailer, observes, "If the other guy is doing it, at the very least I have to try it, especially since he claims he is successful." If the news is discouraging, most managers will not take a chance.

For some senior managers, the initial adoption decision is based on either imitation of others or intuition. Another approach is strategic; this requires much thought, self-education, and effort. Senior managers who are either too timid to take the intuitive approach, or too concerned with other priorities to take a strategic approach will probably do little.

At the middle of management and operating levels, uncertainty centers on mastering, and needless to say being evaluated on, new tools and new ways of doing business. The 15 companies in our survey almost split in half between those where the middle management was nonexistent and those where middle managers pushed enthusiastically for new technologies. These latter companies, needless to say, ultimately succeed in their implementation.

In those companies without enthusiastic middle managers, automated marketing was not successfully implemented. In those companies which did have enthusiastic middle managers but automated marketing failed anyway, the enthusiastic managers left.

People at the operating levels of companies often spell the difference between success and failure of the implementation process. Most workers take up the innovation with enthusiasm; some, however, will not. Nonetheless, a cohesive group at the operating level can overcome such initial lethargy. As Lummie Burt, a supervisor in a major telephone company, reports, "If I like it, I'll make it happen, even if it doesn't work, because I make things happen here." If such group spirit does not exist and the enthusiasm for the new technology wanes, the breakdown of the entire innovation program will probably start at this level.

While uncertainty cannot be eliminated when a new technology is introduced, it can be counteracted to a large extent. Information, involvement, encouragement, safety nets, and rewards for success are all powerful motivators that can reduce uncertainty and potential failure. Companies which introduced new technology successfully communicated often and in detail with the operating group. Some also sought input from the operating level about equipment selection, modification, and software customization. In these cases the enthusiastic operators felt that they themselves got something good out of the technology, whether more challenging work, personal growth, or the opportunity for more pay and preferred job assignment.

A complicating factor in managing uncertainty at the middle operating level occurs in the relative scarcity of crucial employees. Many managers in our survey complained about the shortage of operators who knew how to program and system supervisors who culd handle a spreadsheet. These kinds of comments suggest the necessity of assuring that employee skills are developed in parallel with the implementation of the new technology.

Intragroup Level. The most frequent potential human barrier on the intragroup level is found in the need for long-term perspective. U.S. managers often like to think of themselves in a fire-fighting mode. When they are not putting out fires, the claim to be victims of stock market shift hysteria. Whatever the self-serving or romantic claims of these self-portraits, they do point to the short-term nature of much U.S. business. It should be no surprise to note that many mistakes in implementation have their origins in haste and lack of planning.

Many managers typically buy the first system they come across, install it, and wait to see what happens. Most managers are very eager to implement a new computer system; in their haste, they neglect to bench-mark the system, and they fail to scrutinize vendors rigorously. Usually, they find a sales demonstration which seems to mimic their current operation. Only after the system is installed do they learn that changes necessary to the operation's efficiency cannot be incorporated.

Companies may train their employees for up to six months before a system installation, only to learn that the operators have forgotten most of what they learned while waiting for the system to arrive. If the system does arrive on time, the company may discover that it does not include necessary, customized support systems. Consequently, productivity gains evaporate. Similarly, top management may force the new system onto a department expecting quick returns. Confused and distressed middle managers may ultimately block successful implementation through no fault of their own. Finally, managers may adopt a complex system, only to find that no once uses all the expensive bells and whistles.

Traditional planning techniques should be incorporated in the selection of computer-aided direct marketing systems. As Mike Farland says, "Even though marketers fly by the seat of their pants all the time, this is really an engineering project with a high degree of uncertainty, and it has to be managed that way." A project manager may be appointed, for example, six months before the equipment arrives. He or she may have a clear charter to become a departmental manager after the implementation. Before the implementation, however, his or her sole responsibility should be to develop an adequate plan. A full understanding of the company's needs and how the new computer system will address those needs should lie at the heart of the planning process. A steering committee, consisting of top MIS personnel, can be of great value in successfully implementing a new system.

Intergroup Level: The most frequent potential human barrier at the intergroup level arises from potential changes in power relationships. When a new technology is successfully introduced, those who own it or use it see their power and status enhanced; those who do not use it experience the reverse. Consequently, some groups resist introduction of new technology, or, failing that, ensure its failure.

When technology becomes the exclusive domain of a single employee group, the mastery of the technology confers special status which can then cause others to be uncooperative and jealous. This separation can be further reinforced by other factors such as age. One large public utility, for example, located a young, enthusiastic direct marketing group operating computers in a building separated from the rest of the marketing department. This physical separation alone fostered resentment and lack of cooperation when managers tried to coordinate their efforts. Joyce Baldwin, a direct marketing manager for the public utility, describes this feeling of alienation as follows: "For them (the rest of the company) we were weirdos." After the young direct marketing group was forcibly reintegrated into the marketing department, they expressed some longing for their previously arrangement; nevertheless, they did admit that the new arrangement was better for the department as a whole. As Joyce Baldwin observes, "We were more efficient as an isolated group, but now we can finally get somewhere within our company."

Frequently, unions attempt to prevent the loss of tasks taken away from those who refuse to accept new technology. One large utility, for example, must maintain a group of ten entry level employees whose only task is to read computer printouts and re-enter them from a DEC computer into an IBM computer. Many errors, needless to say, are created in the process.

While automation almost always means job changes, it rarely translates into job losses. In some cases, however, it can mean a reduction in the work force. In such cases, workers will naturally resist change.

While these examples may seem obvious, more subtle conflicts are likely to arise between departments which must cooperate to make the new technology a success. An MIS group, for example, may feel threatened by the installation of a computerized system not under its control. It may seek a corporate mandate to control the system, or, failing that, it might withhold its cooperation. Additionally, direct marketing groups can shift some power from advertising to market research, or vice versa, depending on who installs which part of the system first, and therefore, who claims proprietary rights. In such cases other departments may subtly slow the expansion or use of the system, or they may refuse to cooperate completely.

Those companies in our survey most able to overcome the resistance or uncertainty barriers had a strong and persuasive champion who lobbied passionately for new technology. A champion located at the senior management level can best overcome resistance and invidious uncertainty. One such champion was an executive vice-president of marketing. He was able to generate broad support for computer-aided direct marketing and bridge gaps between various departments. Most champions, however, are usually middle managers. Their success in overcoming barriers appears to depend on their expertise and political skills. In some cases a champion's political skills are more necessary than his or her expertise. A corporate mentor who reinforces the champion's efforts with senior management and who protects the project is usually the second-best promoter of new technologies.

Potential Organizational Barriers

Our analysis of organizational barriers follows the basic paradigm of the literature on the organizational development: setting objectives, coordinating to achieve a set of objectives, and measuring to ascertain to what degree these objectives have been attained.

The classification of potential organizational barriers parallels the classification of potential human barriers. It consists of three levels: individual, intragroup, and intergroup. Similarly, organizational barriers are especially apparent in periods of significant change.

First, research focuses on an individual within a group. Risk and reward structures for individual are studied, as well as the process of measurement of managerial individual. It is interesting to note that no firm in our sample used the widely accepted measure of managerial effectiveness, "Return of Management;" that is, the residual which can be attributed to management divided by total cost of management.

Second, researchers define intradepartmental issues. These may be divided into a tripartite process:

*Setting objectives as reflected by the planning tradition

* Coordinating attainment of objectives by the department as reflected by the reporting structure

* Measuring the attainment of objectives of the department.

Third, interdepartmental issues are examined. Their expository structure parallels the discussion of the intradepartmental barriers.

Individual Level. The most frequent potential organizational barrier on individual level is the lack of incentives to innovate. Many of the managers interviewed were evaluated and sometimes rewarded on the basis of financial criteria, results, or ratios. An investment in computer-aided marketing could have a negative impact on a manager's financial evaluation in several ways.

First, computer systems are expensive and a percentage of their cost is allocated yearly against a manager's budget. If he or she purchased such a system then merely maintained the department's annual contribution to profit, such a system would clearly have a negative financial effect. Unfortunately, immediate financial gains are the exception, not the rule. Even if not compensated in this way, a manager might hesitate to invest in a risky new technology and introduce such a system if budgets are tight and expenditures under scrutiny.

Second, in most cases the investment must be justified using net present value; that is, calculations based on projections which are based in turn on increased productivity. Given the fact that such projections are unreliable, a manager must feel either very secure in the organization or believe strongly in the technology before risking pay, promotion, or career. Consequently, the very organizational system that encourages fiscal responsibility may in some cases discourage investments which do not promise short term gains.

Pressure from senior management to show dramatic gains can lead to dysfunctional behavior among threatened middle managers. In some cases, they might try to tamper with post-justification figures in order to force results into line with projections. Many of the managers interviewed admitted that they had on occasion fooled accountants in order to achieve their own ends or present an investment in computers in a more favorable light. Such actions carry risk, of course, that only the committed, the brave, or the foolish may wish to bear. As Lynn Phillips, a manager in a large midwestern bank, puts it, "Only my youth and excitement in my new PC excuse this amount of creativity."

Companies which avoided these pitfalls had decided a technology for a long-term or strategic reason. The decision had generally been made at the top of the organization. These companies recognized that implementation managers faced novel tasks and would need flexible financial and managerial guidelines. As Butch Madigan, the senior vice president of marketing operations with a retailer, notes, "Without Chuck's (the firm's president) statement -- 'we have to do it, but you are expected to fall before you succeed' -- it would have taken us years to get to where we are now."

Implementation managers faced with unrealistic financial and managerial expectations, on the other hand, might transfer those expectations to the operating level, causing employees to leave. Other employees, fearing layoffs in the face of automation, might slow the implementation process to a snail's pace.

These kinds of situations call for a new evaluation processes for managers. Managers should be evaluated and rewarded for the implementation of a new technology in a way very different from their regular day-to-day activities. Managers who champion a new technology implemented without major or minor catastrophe and who secure the cooperation of many departments should receive special status in the organization.

Intraddepartmental Level. The most frequent potential organizational barrier on an intradepartmental level results from an incomplete view of interdepartmental benefits and costs. In many firms, direct labor costs constitute a small part of the total production costs. In spite of this fact, the investment decision for adapting new technologies often hinges on how much these technologies will increase productivity; or, to put it another way, on how much direct labor costs will decrease. Davetta Bills, for example, based her investment decision on increased productivity and was subsequently disappointed.

Her experience with computer-based direct marketing might have been different had she considered alternative issues such as introducing direct improved quality control and lowering indirect labor costs through reduced hours worked as well as fewer incorrect orders. New technologies may have a marginal impact on direct labor costs, but they can improve overall efficiency, effectiveness, and ability to compete. Many managers who were interviewed stated that computer-aided direct marketing can and should dramatically alter the manner in which a company carries out its tasks. If it merely imitates existing processes, it will remain both expensive and ineffective. This is especially true if the existing process is inefficient. As one manager commented, computerizing under these circumstances will surely create chaos instead of order.

To implement new technology successfully, companies must rethink the way they operate and question such previous assumptions as their focus on direct labor costs and rigid adherence to marketing ratios. This is not to suggest that computer-aided direct marketing cannot reduce the expensive labor component of certain marketing-production processes. It can help. The use of automation, however, will not necessarily generate the greatest savings; valuable benefits also occur in rethinking the entire use of automated marketing.

In our study, managers often stated that computer-aided direct marketing forced them to streamline their inefficient marketing processes. Their approaches varied. One of those interviewed, Bill Stark, observed that many companies would do better to rethink their current marketing flows and systems before investing in expensive automated processes. Another manager, Joyce Baldwin, felt strongly that her company would be forced to improve its sloppy handling of customers after adopting an automated flow. In retrospect, restructuring an inefficient system is usually a good idea; computer automation in and of itself can also act as a catalyst for change. The introduction of new technologies often justifies the change of inefficient, long-established practices held by people in the company who still have vested interests in them.

The best course of action, rarely followed by companies, is to assure that marketing processes are as efficient as possible before automation is considered. The next best option is to rethink the marketing process as computerization is introduced. Many of the companies surveyed chose this option. Disasters occur when inefficiencies that have crept into processes over time are computerized. It is even more disastrous when managers avoid dealing with such inefficiencies, with or without computerization. This is a path to certain death in a competitive environment.

All the companies in the survey sample bought their systems expecting large returns quickly. Some managers anticipated increased productivity from better selling methods on the order of 300 percent. These expectations were not unreasonable given the enthusiasm of articles about computer-aided marketing in trade journals. When these same managers were interviewed after their systems had been installed, however, actual increases averaged between 30 and 50 percent. In most cases this was almost inadequate to fulfill the original net present value calculations.

Several major factors contribute to this disappointment. First, companies forget to allow time necessary to master new technology. In the case of computer-aided marketing, the average time needed to equal manual proficiency is approximately one month. Companies usually begin to realize the full benefits of computer-aided marketing only after three months.

Second, training costs are substantial enough to force managers into an unpleasant trade-off. Inadequate training means of course that employees will take longer to become proficient. Training, on the other hand, takes away from productive time and can be very expensive, especially if salespeople do not receive their customary commissions. Consequently, companies are often tempted to keep training to a minimum.

Most managers agree that call guides and superior descriptions of products and methods for handling objections are essential for facilitating operators' productivity. Nevertheless, creating a library of call guides, products, and objection-handling procedures takes time. One manager estimated that it took six man-months to develop satisfactory procedures while his department was under pressure for production. Such a commitment of time and work hours can ultimately lead to an indefinite postponement of this vital adjunct to implementing computer technology, thus limiting its benefits.

Interdepartmental Level. The most frequent potential organizational barrier on the interdepartmental level is the lack of interdepartmental cooperation. Because computer-aided marketing crosses traditional boundaries such as that between sales and marketing, organizational fragmentation can cause a number of problems. Several of the companies surveyed, for example, had isolated computer-aided marketing operators from the rest of the marketing department. While this separation facilitated cohesion and information-sharing among operators, it caused jealousy, lack of cooperation, and confusion in the group as a whole.

Another problem lies in the potential barrier between functional groups. Lynn Phillips complained, for example, that he could not get the information systems department to maintain his system because the department did not own it. The MIS department probably did not perceive itself as uncooperative, but it lacked the expertise in marketing software and the incentive to expand resources to maintain another department's computer.

The largest organizational barrier to implementing a full computer-aided marketing system, however, lies between advertising and marketing. In most companies the orientation, tasks, environment, goals, and reward systems for these two departments are radically different. Competition between the two groups can often be fierce. Nonetheless, the wall between the two must be breached if computer-aided marketing is to reach its full potential. Understandably, managers cannot be faulted for approaching any cooperative venture between these two antagonists with extreme caution.

Epilogue

In retrospect, major findings of this study are often similar to advice which might be given to political candidates. This conclusion is not surprising since the process of implementation of a computer aided direct marketing system is an experience, which for most managers goes beyond mundane intuition. As in politics, issues are not clearly defined but seem an interplay of expectations, illusions, and realities. Marketing managers are called upon to deal with a new technology about which they often know remarkably little. They must confront manifestations of managerial psychology rarely encountered in their daily routine. Finally, they must operate in a new context of organizational issues, a context which can impose a severe strain on organizational structures by the nature of the potential magnitude of its impact.

The first major finding reveals that several of the potential barriers outlined in this study will in fact appear. Nevertheless, it is difficult to predict a priori which ones will appear, when, and with what intensity. As in political campaigns, one can prepare for such difficulties if one knows in advance which perils might surface. Success in overcoming any potential barriers relies to a great extend on the firm's speed of reaction. This observation holds throughout the process of selection and implementation of the computer aided system.

The second major advice is to be true to the fundamental design concept of the firm's direct marketing flow. Success derives from the close parallel between the original flow of operations and its interpretation in the computer system design. Adapting an existing manual system to a turn-key computer system, designed by a vendor no matter how well qualified, leads to long-term problems.

The third major finding derives from an almost common sense observation. When selecting a vendor and adopting its system to the firm's environment, the manager must explicitly deal with the growth of innovation in the computer industry. Computer technology is currently developing in each of its component areas (software, hardware, and networks) faster than it can be reasonably and comfortably adopted. Given its growth, complexity, and interrelatedness, the manager cannot wait for the best technology in any of its components. He or she must develop a system based on what will operate and what the company defines as satisfactory. To pursue the political parallel, the manager, like the candidate, must have a coherent, workable policy on all important issues. Successful implementation relies on simple solutions and methods which have been tested under fire.

The fourth major finding shows that not only are errors the rule in system implementation, but they tend to be much bigger than is customary for project confined solely to either the marketing or MIS arena. Consequently, it is not only prudent, but imperative, to set aside a budget that is much bigger than expected. Furthermore, budget should be taken to include capital, human, and computer resources.

Firms should not introduce computer-aided direct marketing systems for short term gains. A new computer system is a long term policy and strategy decision in and off itself. Like any political campaign, it's effects will not be felt immediately, but in the direction and shape of the future. With a clear purpose managers may even attain those lofty efficiency and effectiveness gains promised by system vendors.

A. Api Ruzdic is Managing Director at Marketing Support Technologies, Inc. in Carlisle, Massachusetts.
COPYRIGHT 1989 St. John's University, College of Business Administration
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Copyright 1989 Gale, Cengage Learning. All rights reserved.

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Author:Ruzdic, A. Api
Publication:Review of Business
Date:Sep 22, 1989
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