If technology is to change the way an organization manages the sales function, and how it interacts with customers, the technology has to work—otherwise it is both a wasted investment and poses the danger of becoming a detriment to both sales and customer service.
At this point, CRM is used in far more companies than Sales Performance Management or Sales Force Automation technology, which are technologies that typically integrate into the company’s CRM program. Since these programs are most often dependent upon the CRM program as its starting place, whether or not CRM is working is of critical importance as to whether the SPM or SFA program is working as it should.
There are indications that CRM is not doing its job in well over 50% of the companies it has been installed in. And, as you can imagine, the problem doesn’t lie with the technology.
Susanne Obermire on her blog cites a resent article in DM News that indicates that 45% of the companies who have a CRM program believe the program is not effective enough, only 15% of the companies rated themselves ‘extremely good’ at integrating data, and 50% didn’t even have a strategy to utilize the program.
If we assume that 70% of the companies that claim to have a strategy in place to utilize their program are adequate or better at utilizing the system (undoubtedly an extremely aggressive percentage), that leaves 65% of all companies who have invested in the technology with systems that are not getting a reasonable return on their investment.
Furthermore, for those companies who have added an SPM or SFA component to their system, those program’s performance is being negatively impacted by the CRM’s underutilization. Now those companies have two enormous investments that are draining resources from the company.
A corollary to the discussion is found in a CRMA Roundtable discussion held in 2005. During that discussion, Paul Greenberg cited a Strativity study from 2004 of 212 executives regarding their interest in adding a Customer Experience Management (CEM) component to their CRM system. The study found that 58% of the executives surveyed indicated that their companies didn’t deserve to retain their customers and only 31% of executives indicated they even had a commitment to their customers.
The failure of CRM isn’t about the technology. The primary issues are within the companies themselves who purchase the product without having a clear vision of its purpose, how it will be used, what it can and cannot do, and whether the company even cares whether it accomplishes its intended goal.
Before making the investment, companies need to sit down and develop a comprehensive plan of why they are acquiring the system, exactly what it will accomplish for the company, how the system will be introduced to the company and its customers, and how they will train their management, marketing, customer service, and sales staff on how to use the technology. The product developer will be more than happy to help create an overview strategy and to train staff on how to technically use the product. But companies must go beyond that basic strategy and basic tech training—they must bring in outside consultants and trainers if needed to make sure the product is fully integrated with the company’s sales and customer service philosophy, that users understand the ‘what’s in it for me,’ and that managers are thoroughly trained on how to utilize the data the programs generate.
Technology can help transform a company. But without a well thought out plan, thorough training of management and staff, and getting by-in by the users of the system, the technology can do just as much damage as it can good.