From our research, we have found no one single element is sufficient to
significantly improve the chance of a very successful CRM implementation; to reach a solid return on investment; companies must do a good job on
several fronts. The difference between success and failure of a CRM system project is not a roll of the dice, but rather a result of the way a organization approaches the effort. The
secret to success lays in the knowledge and talent you and your implementation team takes to the project. If you know what genuine obstacles you are aiming to solve, what
likely mistakes you can make and how to avoid them, what technological innovations can and cannot do to help you, you are much more likely to be successful.
A CRM implementation's dissatisfaction to achieve a few targets may constitute a general
failure in some people's estimates, when as a whole, the implementation works as planned. The lesson here is clear: When developing the goals of a CRM package, firms need to be
realistic with a phased approach. Companies also need to prioritize their CRM objectives so that the essential functions truly get completed.
Another important factor by far is the new Customer Relationship Management system
lacking a customer-focused CRM system approach. Pick up almost any business, sales, or technical publication today and it is easy to see that there is a Customer Relationship
Management system mad dash. And well it should be. In virtually every single industry, companies who are centering on maximizing their sales process are realizing the substantial
advantages of doing so. They are outselling their competitors by 60% or more, they are cutting their selling cycle time by as much as half, there sales methods are becoming more
customer oriented processes, there sales teams are performing more effectively across inter-enterprise and intra-enterprise boundaries, and they are doing all this at a substantially lower cost.
CRM implementations consist of dozens of interrelated goals and projects under a single
umbrella term. Some CRM solution projects incline to consider the customer as yet another transaction. Most CRM system failures are the consequence of very poor implementations
rather than a problem with the technology or the concepts that support the Customer Relationship Management initiative. Some of the direct components connected to CRM
implementation failures included a deficiency of constant project management during the implementation, lack of executive sponsorship, opposition to change including hidden
agendas, immature product solutions and a failure to clearly define the project objectives, business requirements and critical success components.
In the modern business environment, business managers when making decisions about the
direction of their company, have a lot more requirements because of the hi-tech world we live in. The inspiration for making new strategy of investments in their organization is to
hold on to that advantage they have over the competitor. As a result, some choices may be rushed into which, actually, may become inadequate decisions. That's precisely what
may happen when rushing to put a new Web-based Contact Management Software system in place. So how do you prevent the wrong decision from being made? It's easy; ask your
customer what "they" need in your new CRM system before you purchase.
Up front, an evident divide for many companies is a tendency to over-focus on "what and
how" they want to sell. To get the new Customer Relationship
Management system correct, they really need to build up a closer comprehension of "what, why and how" their customers want to work with them, and even more important, how they what to buy from them.
So how do you prevent the wrong decision from being made? It's easy; ask your customer what
"they" need in your new Customer Relationship Management system before you buy.
What is needed is a deep understanding of your customers' buying process and in turn
your group should build the new CRM system to fit your customer's declared needs.
Develop a customer-centric mindset: "The company's focus ought to be to have a better
understanding of the gap connecting their customer's/prospect's current state of how they do business with us and their preferred expected state of how they want to do business with us."
Building a vendor-client partnership is based on working together with our customers
toward the common goal of committing to them the support they need to better serve their customers. We do this by helping them to deliver higher-quality products and services, faster and more cost-effectively than their completion.
The clear relevance of the state of affairs is the customer is paying for the new CRM
system, so the unmistakable end result is; build the new Customer Relationship Management system to fit the customer's requirements.
Below is a list of the most common elements why CRM projects fail:
Top Failure Cause # 1 - Under time and effort commitment by upper managers and all
concerned - If upper management managers do not essentially believe that successfully redesigning the sales process is one of the top strategic challenges their company faces,
then don't even start a CRM project. The biggest single mistake businesses make is to under commit to their CRM project by senior management and all others involved.
Symptoms of under commitment include:
Lack of senior executive attention - Process restructure inescapably crosses functional
operation areas within a company, so no mid-level manager will have the clout required to secure that modifications are produced.
Tactical plan orientation - Rather than vesting the time essential to prepare a
comprehensive sales process reengineering vision, a temptation occurs to look at creating a series of small, tactical modifications. Dramatic improvements require that you develop
an enterprise-wide insight of how things actually work.
 Part-time attitude - No one has free time nowadays. A part-time approach will not generate part-time gains, it will generate no results. A CRM initiative is a major project, demanding the full-time assignment of
individuals for the length of the project. Very Successful CRM projects are ones that are taken extremely seriously. The major components of a program are - active management participation, an
enterprise-wide shared vision, full-time dedication of staff, accountability for outcomes, and a process-driven budget.
Leading Failure Reason # 2 - Huge dreams for the Web-based Contact Management
System but small budgets to make it happen - Aiming to implement a Customer Relationship Management system as cheaply as feasible is another mistake organizations come to
regret. Funding for Customer Relationship Management initiatives is often not included in the budget when companies start their effort. It is therefore tempting to take a low-cost
approach to the job, so as not to cause any waves in the current fiscal year plan.
This plan of attack is indeed prone to failure. Slow hardware reaction time can turn users
off to the point where they decline to use the system. Part-time computer programming projects typically never get done. Purchasing the lowest cost technology choice may work
in a mature marketplace like spreadsheet software, but it rarely results in the right choice in an developing market like CRM, where you have 500+ sellers each approaching the problem from a distinct perspective.
Price should never be the first thing you focus on in your Customer Relationship
Management initiative, business benefits should. The revenue increases and cost savings you can generate though your CRM systems can be tremendous. But they don't come free.
If you haven't budgeted for a CRM system, then don't kickoff the venture yet. Figure out what you want to achieve, discover what it will cost to get there, compare the benefits to the costs, and decide if it is a good investment.
Top Failure Reason # 3 - Setting forth and trying to take too much on up front - A leading
mistake that is simple to make is requiring too much out of CRM technology. When you hear about hefty gains from implementing CRM systems you may end up assigning too much importance to the technology components that were used.
Time and again, executives mourn about how they started focusing on technology too
soon in the process. The key to CRM system success requires optimizing an effective sales process with the intelligent use of technology. If your company's procedures are
fundamentally flawed, technology may give you a little advance, but more likely it will end up facilitating you to do inefficient or ineffective things faster than ever before. So before
you start looking at CRM tools, give heavy thought to what you want to do with them.
Leading Failure Reason # 4 - Creating a department by department solution: Productive
Web-based Contact Management systems demand an enterprise-wide orientation.
If you grant each of your departments attempt to deal with their component of the sales
process independently, you may create a configuration that even your best computer technician couldn't figure out.
If you take the department aimed solution strategy to designing a CRM system, you may
put together a CRM system where the tools my end up not talking to each other. If you go down this course of action, what you may end up with is a CRM system where you are
inserting and keeping the same information about a customer in many different places. While you may start your Customer Relationship Management initiative in a single area, you
have to take the time up front to set some overall architectural parameters that all agrees to work with. Otherwise, somewhere down the road you will end up with a number of
conflicting point solutions that will eventually force you to rebuild at least part of your Customer Relationship Management system.
Your CRM system is only as effective as the specifics it contains - Implementing a CRM
system is a strategy, Customer Relationship Management solutions are part of a organization approach to raise client experience, client loyalty and customer retention,
increase employee productiveness, and streamline business processes, advance gross revenue and earnings.
Top Failure Reason # 5 - Setting Forth by selecting the wrong technology associates:
With over 500+ CRM-oriented vendors to pick from, you should really be able to find a vendor that meets your specific sales process performance demands. But a word of
warning: don't establish your vendor choice on product capabilities alone. Several firms we interviewed said that in retrospect,
while they implemented a satisfying functionality decision when they selected their Contact Management Software vendor, it ended up being a very poor business choice.
This can happen for a mixed bag of reasons, including:
Be careful that you don't find your group getting packaged into a "technology is the
solution" corner - It is critical to project not just what a CRM system does, but how it does it. Some vendors have developed unique technologies around their products. While
their products may have the elements you need, the product architecture can negatively impact your ability to easily expand or enhance the system to meet expected demands.
Buying the latest computer software package innovations vs. sound sales process
improvement knowledge - How well does your vendor translate the problem you are attempting to work out? A vendor's limited knowledge and awareness of the underlying
business problem you are aiming to clear can negatively bear upon your project.
Top Failure Reason # 6 - When the Contact Management Software Project Champion is
trying to be too diplomatic: Essentially, your CRM initiative has to succeed or your firm's extended future may be in jeopardy. While you want to motivate people to change, there
are some errors companies have reported creating as a consequence of aiming to be too diplomatic in their Web-based Contact Management systems. Some of these mistakes include:
Not securing complete executive level buy-in! - Customer Relationship Management system implementations need to have the full backing and endorsement of each and every member of the executive team. Inter-departmental turf-wars
can erupt if staff don't see that their upper managers are behind the plan.
As your firm moves forward with the implementation receiving
less than 100% user buy-in is not an option - Make it clear that using the Customer Relationship Management system is not a choice; it is a requirement of employment. As soon as
you let a single person get away with not using the system the foundation for your project will begin to weaken.
Seeking to back off the implementation at the earliest sign of problems - No matter how
much thought you and your group has put into establishing a sound strategy for the new Web-based Contact Management system, you and your group can count on running into
unanticipated problems when you implement it fully. Backing off at the first sign of problems will cause doubt, and in due course chaos if it happens too frequently.
Top Failure Reason # 7 - As the new CRM system is promoted early-on throughout the
company, the overall message is the implementation process will be simple - Beginning out with the assumption that automating your sales process will be similar to automating
manufacturing or finance can be a huge misstep. The degree of complexity in implementing a CRM system is dramatically higher than other process improvement examples. The
fundamental reason is the issue of standardization. Other department processes have been standardized by theory and rules. Where are the standards in sales? The answer is there
aren't any. Very few companies sell exactly the same way, so each CRM initiative will have its own unique requirements.
All associated in the project needs to understand this factor up in advance. No
sophisticated CRM product will work right out of the package. Regardless of which vendor you select, you have to build into the project plan the expectation of time necessary to
adjust that product to your group's internal business procedures. Avoid the enticement to try to retrofit your operations to fit the tool you have bought. Instead, position the
products you have purchased as enabling technology, and modify them to cope with your unique sales process specifications.
Top Failure Reason # 8 - Avoiding the people side of the equation: A critical ingredient to
avoid is concentrating too much on process and technology, and not enough on the people who will be using the new Customer Relationship Management system. You can develop
the best sales process in the world, and back it with the latest and greatest technology; but if your staff doesn't buy into the project, it won't work. This is perhaps one of the
most notable project failure factors during the implementation process.
The fear-of-change pattern - Your firm will most likely already have a seasoned sales
process in place. It may be based on printed reports, paper clips, and post-it notes, but it does work to some extent and people are familiar with it. Reengineering requires change,
which most people instinctively withstand. This fear of change needs to be dealt with early on, or the very people the system is projected to help, will be the ones to see that it fails.
Top Failure Reason # 9 - Assuming that once the software is installed the project is done:
You may have clearly defined your project plan, involved all the right people in turning the vision into a reality, done a superb job of rolling the program out across the enterprise, but
if you stop there your program can still fail for a variety of reasons including:
No prescribed training for new employees - Make sure you are preparing for new workers
requiring the same level of training as your existing staff.
Weak CRM system support - Customer Relationship Management systems need a significant
amount of system support. If you are asking your sales teams to commit to managing their sell cycles through a Web-based Contact Management system, then you have to give them a fast, easy way to get answers to system questions.
No Planned Enhancement/Upgrade Process in place - Sales reengineering is not a single
event; it is an ongoing process. You will always continue to enhance the way your sales teams sell over time, so your CRM system will need to be enhanced accordingly. Remember to budget for this now!
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