Questions to Ask CRM. Questions to Ask - CRM Compare Business Products
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1 Questions to Ask CRM Questions to Ask - CRM Compare Business Products
2 Contents Introduction... 3 What Functionality is Needed?... 4 What Integration is Needed, if Any?... 6 Cloud or In-House?... 6 What is the Budget?... 7 What Support Will We Get?... 9 Is the System User-Friendly? What Reporting is Offered? Does the Vendor Have References? References Questions to Ask - CRM Compare Business Products
3 Introduction Purchasing a Customer Relationship Management (CRM) solution is a big investment and many CRM implementations fail. Forrester reported that as many as 47 percent of CRM implementations fail, which is one in two implementations. CRM solutions were found to not be meeting expectations, as per the figure below: Figure: Forrester Research Into Business Results of CRM (Krigsman, 2009) As can be seen, in less than 50 percent of cases did customers agree with the concept that business results anticipated from CRM implementations were either met or exceeded. Part of the problem is that organizations do not ask the right questions when they buy CRM solutions. This means that the CRM system that they select may not meet their needs. In some cases organizations do not even really consider the specifics of their needs at the outset. To prevent your organization from becoming yet another negative statistic there are certain questions that you can ask regarding CRM. These will help you to clarify that you are making the right choice for the right reasons. Questions to Ask - CRM Compare Business Products
4 What Functionality is Needed? One of the first questions to ask about your CRM solution is what functionality is needed. CRM is growing and developing in scale and scope all of the time. This means that there are lots of choices and that can be overwhelming. It can be easy to get dazzled by an amazing system that is designed to impress, but it is important to stick to what it is that you really need, while making sure that you are also anticipating your possible requirements in the near to medium term future. This requires preparing business requirements before setting out on the quest to find the perfect system. In doing this, gathering the input of the potential users of the system will be helpful. These potential users may be found in the customer services team, in marketing, in sales and in management, among others. In making sure to speak with all of the possible stakeholders that will end up using the system you will save yourself from making a mistake and failing to include some area of functionality that might later turn out to be critical to making the solution a success. These end users of the system will understand the kinds of activities that the system needs to be able to perform and can also provide input on future functionality too, by advising on what works well or poorly at the current time. Gathering user requirements also helps to win employees over towards using the new system which is another important reason for taking this step. In particular there are three areas that are worth considering: Anticipate your possible requirements in the near to medium term Mobile what functionality is offered here? Social is Social CRM provided in this system? Customer experience management to what degree does this system support customer experience management? These areas are covered in greater depth in the table below: Questions to Ask - CRM Compare Business Products
5 Area of Functionality What It Does and Why Include It Mobile Social Customer Experience Management The concept of Mobile CRM is that companies can manage interactions with both current and potential customers or clients using mobile applications on mobile devices either cell phones or tablets. Organizations are able to use Mobile CRM to add, edit and manage customer relationships via different kinds of mobile devices. In many cases Mobile CRM has the same sorts of features that regular CRM has. Gartner research shows that the number of Mobile CRM apps that will be available in app stores by 2014 will be more than 1,200. This is a growth of approximately 500 percent compared with projected figures for According to Gartner, Social CRM is a strategy that includes marketing, sales and customer services to actively involve customers in an internet channel to encourage participation in the business. The difference between this and regular CRM is that Social CRM allows organizations to understand relationships and conversations, rather than just data. It creates opportunities to engage with customers or potential customers that are conversing about the organization on these websites. Many organizations have already implemented Social CRM. Gartner defines customer experience management (CEM) as being the practice of designing and reacting to customer interactions to meet or exceed customer expectations and, thus, increase customer satisfaction, loyalty and advocacy. Gartner considers CEM to be a business strategy that is undertaken which requires both technology and process change to fully support it. There is a sense with customer experience management that the customer as an individual is being considered, rather than the customers in large segments only. Questions to Ask - CRM Compare Business Products
6 What Integration is Needed, if Any? In many cases a CRM system will need to integrate with other organizational systems and tools in order to be effective. This may include linking it with repositories of customer data, or tying it together with other pre-existing or legacy tools. This makes a CRM implementation more complex, but failing to integrate can lead the CRM solution to ultimately fail, or certainly to fail to meet the needs of the users which could end up having the same overall effect. Making sure that systems link together is important for making sure that collaboration between different teams involved with building the customer relationship increases, rather than declines as a result of the CRM system deployment. Before even approaching CRM system vendors it is worth getting together a list of the different systems and tools that the CRM will need to be able to work with, technically. Involving the Information Technology team in this process will be helpful due to the type of information that will be needed. It will include gathering together technical information about how these systems were built and what technologies they use and how. Armed with this information you will be able to go to a CRM provider and find the system that will be able to best link together with your existing technologies. Failing to integrate with existing systems can lead the CRM solution to fail Cloud or In-House? Another important question that decision makers should answer before going out and speaking with vendors about CRM is whether the organization will buy servers and other hardware, or whether these will be leased by working with providers that offer cloud based solutions. Many organizations are opting for cloud based systems, and recent research found that while 50 percent of the companies do not have a preference, of those that do, 96% want a system that is based on a cloud model (Anderson, 2013). The Questions to Ask - CRM Compare Business Products
7 answers to this will probably be based on budget, level of control required, and technical ability of the organization. In terms of cost, the most expensive decision is to support the system in-house by using the organization s own hardware. Deciding on the amount of hardware and the specifications of that hardware will depend on the volume of data and types of data that will be going through the system from the various channels that will be utilized. The organization is in control with this solution, and that is a distinct benefit unless the technical skills in the company are lacking. If the organization s technical skills it may be best to go for a supported cloud based solution. The most effective solution in terms of costs is to opt for cloud data storage. In this scenario the organization will share both bandwidth and technical services with other companies. In most cases with this type of approach companies only pay for what they use. This is really helpful for companies that lack technical ability since they do not have to worry about supporting servers in this instance. At the same time, this type of solution can be is excellent in terms of costs because the company can scale up and down depending on actual need, without purchasing hardware to support peak data storage. The problem with this for some organizations is that a third party organization will have at least some level of control over the organization s data. What is the Budget? CRM systems offer a fine selection of different kinds of functionalities, and can cost anything from nothing through to many thousands of dollars. This is one reason why deciding on actual system requirements up front is so important because if not it can be all too easy to get drawn into purchasing a system that is very expensive and far exceeds the requirements of the business. Once the business requirements are documented they can be divided up into two categories. These are Finding new customers is estimated to cost 7 times more than retaining existing customers. Questions to Ask - CRM Compare Business Products
8 functionalities that the organization absolutely has to have, and those that would simply be nice to have. Doing this will help to research the possible tools that might be available and their relative price ranges. Some systems will deliver both the essentials and the desired requirements as well as much more besides, but these systems are likely to be quite expensive and potentially overkill for a smaller organization. All of this helps to ensure that the company does not buy a CRM system that is really expensive just to meet the needs of one requirement that was just something that was offered up as an afterthought by an executive. Open source CRM systems are available and this can be an option for organizations that have little budget to spend. However, sometimes open source systems can cause frustration because they perhaps do not quite do what the company hoped they might. In that case sometimes organizations try to alter them technically to meet actual business needs, and over time such work can actually end up costing quite a lot. In many cases it is better to get it right first time rather than build something incrementally from a system that was not quite right to start with. This is often a waste of both time and money. Training may be required for various types of end users that interact with the system differently. When considering the budget, likely return on investment should also be reviewed. The purchase of the system should not just be viewed as a cost, since if selected properly it should be able to offer considerably value to the organization. It is worth remembering that finding new customers is estimated to cost seven times more than hanging onto existing ones, and CRM systems are specifically designed for retaining customers. These types of figures are worth building into the calculations because when weighing up these benefits it might be possible to stretch to a bigger budget. It will often be worthwhile to do so. Questions to Ask - CRM Compare Business Products
9 What Support Will We Get? Another key question to ask when selecting a CRM system is about the level of support that will needed, and comparing this with what will be provided by different vendors. Depending on the type of system that is being offered some vendors will be very hands on, while others will provide the system and charge more for different types of support. Understanding the organizational needs for different types of support at the outset is important to making sure that expectations are met by vendors. One area in which the organization will likely need support is with training. Training may be required for various types of end users that will interact with the system differently, such as those in customer services, marketing and sales, among others. There may also be a need for the company to get training with regard to system administration, and potentially system support too. The organization should consider what level of support it needs with regard to training and make sure this is included by the different vendors under review. In many cases it is best not to settle for a one-off training arrangement, since users may have questions after the initial training and once they start using the system for real. Clearing up these sorts of questions in advance of selecting a system can save a lot of stress. Is the System User-Friendly? Though it might be hoped that all CRM systems would be user-friendly, some are certainly more so than others. If the system is user-friendly the employees will be more willing to use it. If it is not then productivity and efficiency of teams could plummet. This is likely not one of the goals of a CRM system for any organization. Getting a demo of the system, ideally with one or two critical end users that are open to the idea of a new CRM system is helpful in identifying whether or not Getting a demo of the system can help see if the CRM solution is user-friendly. Questions to Ask - CRM Compare Business Products
10 that CRM solution is quite as user-friendly as the vendors say that it is. If this is not possible, some systems do offer a short free user trial, or a free demonstration on their website. All of these options are worth checking out because the more user-friendly the system is, the greater the chances of implementation success of the CRM system. What Reporting is Offered? Organizations often have quite bespoke reporting requirements that need to be fulfilled by their CRM system, and this can often be an area of disappointment after a system is implemented if the specific details of actual reports that are available are not checked in advance. In many cases if the vendor is aware at the outset of a specific reporting requirement it may be possible to tailor the system to meet this need, bringing the cost of this under the umbrella of the whole project. Discovering that the reporting does not meet the needs of the business after the event of implementation is likely to be costlier to resolve. Confirming with executives as well as marketing, sales and customer services managers among others will help to make sure these needs are met from the beginning. Does the Vendor Have References? A simple question to ask, but one that can also save quite a lot of pain, is asking if the vendor of the CRM system can provide you with any references that you can contact. It is all too easy to bypass this important stage of the process. However, it is recommended that organizations do contact references. References can shed considerable light on how the vendor worked with their team and advise on any potential issues that companies might want to consider in advance. Of course, references are unlikely to say anything deliberately negative because they will have been especially selected by the vendor as an organization that was very happy with the outcome of their CRM system purchase. Nonetheless, that the vendor has a reference or two that is willing to say good things about the vendor organization is certainly a positive sign in and of itself. Contacting references can avoid issues that could easily have been avoided, and it is usually a rapid process, so highly recommendable. Questions to Ask - CRM Compare Business Products
11 References Anderson, J. (2013) 2013 Top CRM Buyer Trends, Info Trust, accessed 11/27/13: Dilworth, D. (2013) Mobile CRM Apps to grow 500% by 2014, Media Bistro, accessed 10/20/13: _b34482 Gartner (2013) Gartner says number of mobile CRM apps downloadable on app stores to grow to over 1,200 by 2014, Gartner, accessed 10/22/13: Krigsman, M. (2009) CRM failure rates: , ZdNet, accessed 11/25/13: Murphy, E. (2013) Enterprises to show CRM the money, CRM Buyer, accessed 11/27/13: Rose Asp, (2013) Cloud CRM trends around the world, accessed 11/25/13: Rothman, D. (2013) Choosing a CRM Solution? 5 Important Questions to Ask Yourself, Bluewolf, accessed 11/25/13: Russell, L. (2013) 3 Crucial Business Trends to Plan for in 2014, Customer Think, accessed 11/26/13: Woods, D. (2013) Why your CRM Implementation is Quietly Failing, Forbes, accessed 11/27/13: Questions to Ask - CRM Compare Business Products
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