The statistics could discourage even as sunny a soul as Pollyanna: Studies show that a high percentage of Customer Relationship Management (CRM) systems have failed to meet company expectations. In 2009, Forrester announced a failure rate of 47%.
That's not to say the projects were complete failures. Most often, a project delivered some expected benefit, but still left users unsatisfied.
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What went wrong? Among the oft-cited reasons:
- Lack of planning
- Lack of buy-in from users
- Misdirected focus on customer relationship management as a technology rather than a business strategy
- Inadequate training
- Selecting the wrong system
1. Lack of Planning
Failure to develop a business strategy that includes clear, concrete and measurable goals -- including measurable payback from the CRM software investment
- Know what your goals are -- and which hold the highest priority. When you know your goals, you can establish metrics to calculate return on investment (ROI). For example, if you want to increase average deal size by selling solutions instead of individual products, the metrics could be average deal size and average revenue per sales rep.
Failure to reconfigure business processes that deal directly with the customer.
- To make CRM work, you have to be prepared to change processes that affect customers. The way you do things now may not integrate smoothly with the software system you select.
Failure to put customer satisfaction -- not profits -- first.
- You have to think of your strategy as a way to serve customers better. So define the customer experience and determine how customers should be handled at all touch points. The reward will be loyal customers who feel cared for by your company.
2. Lack of Buy-In From All the Stakeholders
This includes top management, the sales staff and other customer-facing employees. If your people refuse to use the system, you've wasted your investment.
- Listen to your stakeholders; then select a system that takes everyone's needs into account.
- Include stakeholders on the evaluation team. If people feel they have been involved and allowed input into the decision-making process, they will feel more attached to its success.
3. Approaching CRM strategy as a Software Project
Remember: Software is simply a tool to achieve your customer relationship goals.
4. Inadequate Training and Support
This includes both prior to and post-implementation. Identify the employees who need to use the system, and make sure they get the training required to operate it properly. If necessary, institute ongoing training to accommodate changes and updates in the system.
5. Choosing the Wrong System
Each CRM system is different. Select a system and a vendor that meet your unique requirements.
Know exactly what you're buying. Is everything included in the base price, or are some things chargeable add-ons? In addition, make sure you choose a system that can expand along with your business. Finally, include the costs of maintenance and upgrades in your budget.
There are plenty of CRM systems to choose from, many designed specifically for small business Plan strategically, encourage buy-in from all stakeholders, insist on adequate training -- and make sure your IT team isn't the only deciding force. That way, your implementation is less likely to become a disappointing statistic.
Bio: Megan Totka is the Chief Editor for ChamberofCommerce.com. She specializes on the topic of small business tips and resources. ChamberofCommerce.com helps small businesses grow their business on the web and facilitates connectivity between local businesses and more than 7,000 Chambers of Commerce worldwide.