CRM is one of the hottest management tools being used by the organizations for identifying valuable customers, reducing customer acquisition cost and securing their loyalty through tailor-made offerings. Out of curiosity, I Googled for the failure rate of CRM implementations, and I couldn’t find validated data. After all, every software vendor would like to, of course, trumpet their success stories.
As per a Bain study, CRM ranks in the top 10 Management tools but the Usage Rates for a CRM tool is 48% in USA. CRM ranked in bottom 3 for satisfaction out of 25 popular tools. So, why is it that CRM is not able to live to up to its promise?
We will look at the most common mistakes which companies make while implementing CRM –
Implementing CRM before creating a CRM strategy – Effective customer strategy is based on segmentation analysis and a sound marketing plan.
Assuming CRM technology will take care of the marketing strategy is one of the most common mistakes that the companies make.
To implement CRM without doing proper customer segmentation analysis is like building a house without architectural plan.
Rolling out CRM before creating customer centric organization – This is the most dangerous mistake that a company can commit. It is folly to embark on the CRM path without reconfiguring all processes and systems so they actually fulfill customer needs. Eg: Many companies opt for voice prompt systems that can in the long run drive business away as customers are unable to raise their concerns to a live person.
Not getting CRM requirement right – Many organizations fail to capture the needs of executives, sales rep, and broader business teams during the requirements stage of a CRM project. Too much emphasis laid upon the technical aspects of implementing a software which tends to neglect the simple basic questions as “what do you want to capture in daily reports?” or “what is the use case for your end user of the software module?”
Inadequate CRM training – Rolling out CRM without adequate training to employees is counter-productive. Sufficient tutorials, group sessions must be conducted so that employees know exactly how to operate the software and make the best use out of it.
Assuming that more CRM technology is better – Many executives feel that more technology intensive a CRM software is, the better it will be. Simply relying on a technological solution is a costly mistake which the companies must avoid. To begin, start with low tech alternative first. With this in place, technology can be ramped up slowly. This will allow the managers to test the efficacy of the solution vis-à-vis their customers and know exactly the technical specs of their ideal CRM.
Failure to integrate CRM with other critical systems – It is crucial to integrate the CRM system with other systems like email, ERP etc. This integration creates one true unified system within the entire organization and helps in increasing the sales revenue significantly.
Engagement of internal teams – CRM implementation should not be treated as a standalone project. It should be guided by taking inputs from all teams who are going to work with it. Lack of engagement from the internal stakeholders can lead to low adoption rates after the implementation.
The perils of CRM implementations is hidden as in the treacherous waters of the Everglades.
To draw few parallels,
The Rangers = The Experts in CRM parlance who know the Landscape;
The Environment = The Executive Stakeholder + CRM Users who know the internal CRM system and
The Alligator = Many actors vie to be The alligator!!
A wrong Implementation will eat your organization into a death roll.
It can stifle company’s growth, demoralize the frontline sales team, annoy the finance department in matching the “Actuals” vs. “Budget” between systems, lead to customer churn to cite few examples.
In short, successful CRM implementation depends on the companies’ customer strategy, on how they manage change and train their employees. It is only a facilitator in the process of better customer relationship management, and its employees are the real champions.
At MobiusLogic, the team brings the experience of implementations of Onyx CRM, Siebel CRM, Salesforce.com, Microsoft CRM Dynamics for small, medium and fortune clients. We understand the pain of data quality, data migration, data integration, dashboard, reporting and importantly the usage.