Why CRM/SFA Projects Fail
David Sims, sharpAngle
CSO Forum partner Jim Dickie is known as one of the leading gurus of CRM best practices today. As such he's by definition one of the most knowledgeable on biggest pitfalls. You see as many CRM projects as Jim has (over a thousand and counting) and you see a lot of shrapnel sticking out of charred hulks.
Their loss is your gain, if you wake up and take notice. For the past six years CSO Forum has been keeping score on what causes otherwise smart people to throw up a brick when it comes to CRM. Without further ado:
- They under commit. "If you or your senior management team do not fundamentally believe that successfully redesigning your sales process is one of the top strategic challenges your company faces, then don't even start a CRM project," Dickie says. The biggest single mistake companies make is to under commit to their CRM initiative. Symptoms of under commitment include a lack of senior executive attention, and failing to invest the time required to develop a comprehensive sales process reengineering vision, settling instead for a series of minor, tactical changes.
- They consider the CRM project a part-time project. Look, nobody has spare time today. A part-time approach will not generate part-time results; it will generate no results. A CRM initiative is a major undertaking, requiring the full-time assignment of people for the duration of the project. Successful ones have active executive involvement, an enterprise-wide shared vision, full-time commitment of personnel, accountability for results, and a process-driven budget.
· They try to pave goat paths. This is usually the result of expecting too much out of CRM technology, Dickie says: "Time and again, I have heard executives lament about how they started focusing on technology too soon in the process. If you use 21st century technology to pave a goat path, you will end up with a real smooth goat path. But, it is still a goat path." If your process is fundamentally flawed, technology may give you a little boost, but more likely it will end up helping you do inefficient or ineffective things faster than ever before. So before you start looking at tools, give serious thought to what you want to do with them. - They have champagne tastes and beer budgets. Trying to implement a CRM program as cheaply as possible is another mistake companies come to regret. Funding for CRM initiatives is often not included in the budget when companies kick off their effort. It is therefore tempting to take a low-cost approach to the problem, so as not to cause any waves in the current fiscal year plan. Dickie terms this approach "extremely prone to failure." Slow hardware response time can turn users off to the point where they refuse to use the system. Part-time programming projects rarely get done. Buying the lowest cost technology choice may work in a mature market like spreadsheet software, but it almost never gives you the right choice in an embryonic market like CRM, where you have 500+ vendors angling for your buck. Cost should never be the first thing you focus on in your CRM initiative; benefits should.
- They pick the wrong technology partners. Boy, there's no excuse for this one. With over 500+ CRM-oriented vendors to choose from, you should be able to find a solution that meets your specific sales process functionality needs and get them to wash your car on demand. Mistakes happen when you base your vendor choice on product features alone. Several companies we interviewed said that in retrospect, while they made a solid functionality decision when they selected their CRM vendor, it ended up being a poor business choice.
- They expect to just add water. Assuming that automating your sales process will be similar to automating manufacturing or finance can be a huge mistake. The degree of complexity in implementing a CRM system is significantly higher than the other two examples, Dickie says, due to standardization. Where are the standards in sales? There aren't any -- no two companies sell exactly the same way. And, probably most damning of all.
· They think they're done. Acme Anvils has clearly defined their 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. They're well on their way to tanking their CRM. Why? They haven't counted on any new employees requiring the same level of training as existing personnel, they haven't budgeted for necessary upgrades and they haven't adequately budgeted for ongoing system support. Kiss them goodbye.