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During a challenging economy, it’s no surprise that organizations are forced to do more with less. Sometimes, cutting costs and streamlining operations are the impetus behind a CRM investment. That was certainly the case for one of this year’s Elite winners, which is now saving roughly $40 million per year thanks to its CRM installation. Conversely, another Elite winner impressed us by generating millions in revenue from the implementation of its global customer database. And others, like the Elite winner on the next page, have even broader aspirations, seeking to cut costs, streamline operations, sell more, gain better insight into product inventory and customer behavior, and improve customer satisfaction. All of these are attainable goals, as this year’s CRM Elite winners have proven.
State of Illinois
Know When to Hold 'Em
The Department of Corrections (DOC) for the State of Illinois is a $1.34 billion operation that houses about 50,000 inmates, and in late 2009 it had a huge problem on its hands.
Contrary to Governor Pat Quinn’s express directives, some violent offenders had been released prematurely under an accelerated-release program that quickly became a source of political embarrassment when an Associated Press report was published before Christmas. Sean Vinck, then the intergovernmental affairs director for the governor’s office and now the state’s CIO, was asked to step in as special administrator to fix the problem.
“What we quickly discovered was that the DOC operated its IT in an absolutely archaic, antiquated fashion,” he recalls. “The number of years a person needed to serve in prison, how much good time credit that person was eligible for, when they would go on parole, and so on, all were being calculated manually on pieces of paper by state employees with little or no legal training.”
The DOC’s research department first reported to the governor in December that 1,718 inmates had been released early, then revised the number to 1,745, then to 1,754. To make matters worse, in the first two estimates, 200 offenders had been misidentified. This mistake became the subject of a New York Times article, titled “Illinois Governor Struggles to Identify Freed Inmates,” on January 23, 2010.
“The Times article asked correctly how we could run a correctional system and not know the history of who we were releasing and what crimes they committed,” Vinck says. “But it’s actually understandable if you know what IT resources, or lack of them, we had.”
As DOC’s CIO, Herbert Quinde, an IT modernization specialist, was assigned to find a solution, one that would enable the department to manage, track, and identify its offender population.
“The challenge was this: We had a mainframe application that had been deployed back in 1988, we had 41 client-server applications, and we had information that was being aggregated manually (on paper),” he says. “Each database reported separate information; no two client-server applications were integrated. As a result, it was very difficult to get real-time—or even near-real-time—authoritative data about anything.”
Initially, Quinde determined the solution would require a corrections application suite, a substantial operational data warehouse, data marts for subject-specific processes, a business intelligence reporting tool, middleware to coordinate the 41 applications, an ETL process, a document management system, and a Web portal for dynamic reporting. But, according to an earlier estimate, the price for such a solution would be at least $100 million. To put that in context, the annual IT budget for the DOC is $13 million.
Instead, he bought licenses for a CRM software solution that would let the DOC combine data from its databases with paper documents, which is the only way the information is provided by other agencies on which the DOC depends. The result would be an electronic master file that combines data and information from paperwork.
After scouring the possibilities, the DOC went with licensing Microsoft Dynamics CRM business software, which cost a little less than $4 million—a considerable savings over the previously quoted $100 million. One additional benefit is that Dynamics CRM would not require hiring a systems integrator.
“We have been able to use our own subject matter experts, who don’t have to be programmers,” Quinde says. “With Dynamics CRM, we’re working with templates, with processes that are well-defined. You don’t have to build a security model or a data model.”
By having a tool that allows development without having to do a lot of coding, Quinde says he could employ DOC personnel, instead of paying tens of millions for a systems integrator who would have to train for months to understand the environment.
“We project cost savings of $40 million per year in terms of hard-dollar savings and operational efficiencies,” Quinde says.