ASPE RESOURCE SERIES Best Practices for Planning and Deploying a Salesforce.com Solution Prepared for ASPE-IT by PEAK Sales Consulting's Russ Lombardo Real Skills. Real Results. Real IT.
BEST PRACTICES FOR PLANNING AND DEPLOYING A SALESFORCE.COM SOLUTION Russ Lombardo PEAK Sales Consulting russ@peaksalesconsulting.com www.peaksalesconsulting.com Licensed to ASPE for Distribution All Other Rights Reserved - 1 - ASPE-IT a
The CRM Challenge Let s first review why Customer Relationship Management (CRM) implementations tend to fail more often than they need to. There are several misconceptions about sales automation that should be clarified. First, the mere introduction of CRM solutions will not guarantee increased sales nor solve internal company problems or mismanagement. Second, if not properly planned for, the introduction of a CRM system will not necessarily improve sales performance. It will only allow a poor salesperson to accomplish poor habits more quickly. So, if CRM projects are so difficult, then why automate at all. Well, to begin with customers are more demanding today than ever before. They require better service and support more quickly and more reliably than they did just a few years ago, and the sales force needs to be better equipped to respond as a result. We are also looking to improve the productivity of sales reps, not to mention increase their effectiveness. Improving the information flow for management and customers is another reason why automating a sales force is important. Not only should management have quicker, better and more accurate information about sales opportunities and the pipeline, but customers benefit from your organization knowing important information about them, their purchase history, technical support issues or payment status. Sales people in the field have a wealth of knowledge about the market, competitors, industry trends and more. Therefore, marketing feedback is another reason why automating the sales force is important. When sales reps can provide important information about the market, customers, industries and the like, then Marketing can do a better job of targeting their messages to the right customer profile as well as executing more effective campaigns to find those prospects. Finally, better analysis and comprehensive, easy reporting are the results of wellimplemented and fully utilized CRM systems. Management can get a better handle on the productivity of the sales organization as well as analyze the effectiveness of the sales processes in place. In spite of all these reasons to automate your sales force, why do so many of these efforts fail, or at best turn out to be ineffective? And by fail, I mean that the release was late, it went over budget and/or it was released to the users with less functionality than originally intended. The first reason for these failures is user resistance. If it doesn t help sales reps sell, then they won t use it. Many high-end CRM products are overly complex and not intuitive, thereby causing too much work on the part of the sales reps to learn and use. Second, the CRM projects take too long to implement. This is usually the result of product technology -- the product chosen requires customizations to the core product, thereby taking a lot of time and money to tailor to the customer s needs. With more elegant solutions such as Salesforce, the customizations are saved within the database structure and released to the users automatically instead of having to recompile code and send new product modules out to each user every time new features are added. - 2 - ASPE-IT a
Another cause for failure of CRM projects is overkill. Management tries to get the sales force to use all the features of the system immediately. Typically, with many systems, users can initially absorb perhaps only 20% of its features, but management expects them to use dozens of features right from the start. As a result, instead of learning and using a little at a time and increasing the utilization over an extended period, they don t use any of it. If, for example, the system was initially rolled out with a simple, clean interface for entering Account and Contact information, as seen in Figure 1 of a Salesforce Account screen, then there would be improved user acceptance and a faster learning curve. Figure 1 Another cause of failure is lack of support from management. Without management fully supporting a project of this magnitude, there s little chance for success. Management support includes the funding and commitment for adequate equipment, training time, planning and acceptance of lost productivity while the sales force is getting up to speed with the new system and processes. - 3 - ASPE-IT a
The Path to Success Building The Team A CRM project is a major undertaking that needs to be handled and planned properly. So what will it take to successfully implement your Salesforce solution? First, build a team. The members of this team should include everyone who will use, or may use, the system either initially or eventually. Include members from sales, marketing, customer support, customer service, management, IS, finance and perhaps more. The team should be committed to making the vision a reality. They must also understand the business issues of the project, as well as the workgroup, political and human issues. A key member of the team could also include an external individual (consultant) who is experienced with implementing, installing and executing Salesforce solutions. Having an outsider s view will also give you a different perspective of your business and its operations. Second, market the project internally. Give it as much exposure and hype as possible so the entire organization is aware of the project and will accept it as a positive effort that will benefit the company and its customers. It s important that the team understands the technical and field support issues as well. Additionally, it would be useful if the team had political clout within the company to help get buy-in and internal support if needed. This can be accomplished by picking the right members for the team those with the right amount of influence within their organization and the company. Also, as mentioned previously, having the right management support for the project right from the start will be critical to ensure the teams success. The team should establish and adhere to written project goals that are realistic and achievable, and they should agree to what they are trying to attain. Remember this project will affect human behavior and will change the way your company does business and operates. Therefore, senior management and the team members should coordinate their efforts and plans. There should be ownership of this project and it must include all members of the team. It will be futile if any one member/department is not committed to making this succeed, so all members of the team must have a sense of ownership of this project. The team should also plan for a simple, initial deployment of your Salesforce rollout. Start out with minimum core competencies, and then plan for modular growth, expansion and improvements. - 4 - ASPE-IT a
Finally, the team must insist that the adoption of Salesforce be made mandatory everyone must use it. However, don t underestimate the tremendous impact on the way your sales force does business. Plan for all rollout costs including spare equipment, travel and training costs, support costs, lost sales time during the rollout, productivity loss during the initial stages and more. If you don t plan for these costs and allow for these accommodations, you increase the probability that people won t fully use the system, or at all. Business Case and Planning Make sure your Salesforce project has a business case focus. In other words, make sure there is a clear understanding that this project has a direct contribution to the company s bottom line, that there is a return on investment that is definable and understood, and that this is not just a project for technology sake. - 5 - ASPE-IT a
When determining a business case for a project like this, it helps to tie it to productivity and results. If, for instance, you are asking your sales people to submit their weekly forecasts using spreadsheets, there s a good chance they are spending a least an hour per week preparing this document. Multiply that times the number of sales people you have. Then add the amount of time it takes sales management to consolidate those individual spreadsheets into a single document, which is often times another couple hours. Add all these hours together and multiply by the cost per hour of each sales person and manager. The cost per sales person can also be tied to lost opportunity time since they are not out there selling when they are preparing spreadsheets with their forecasts. You ll find that this number alone will be pretty substantial, especially when you carry it out over a year. You can do the same calculations for weekly status reports. You know, the ones where the sales people have to say what they did for the week; such as how many calls they made, customer meetings they held, presentations and demos they gave, emails they sent, and the like. This adds another hour per week per sales rep to the costs. Again, you ll find this too adds up to some substantial costs over the year. Once you have collected all these costs, you can then show how using a powerful tool such as Salesforce can reduce this extra work for each sales person by automatically generating forecast and activity reports. All the sales team has to do is use the system to log their activities using Salesforce s simple calendar system (and since all sales people use a calendar system anyway, this is something they do as a matter of course and not an extra step) and track their opportunities using Salesforce s powerful yet easy-to-use forecasting system. Since Salesforce will generate consolidated reports for management, the costs of having your sales team do this extra work every week will diminish and you ll have a strong ROI to use in your business case. Salesforce is a powerful sales tool that helps sales people become more efficient and effective, thus increasing productivity and reducing the sales cycle, which have a direct relationship to closing more business. This factor alone can show a huge benefit to the project and will help your business case, albeit a bit challenging to try to put an exact number to the increase in revenue. However, if you conservatively estimate that sales will improve 5-10% as a result of more efficiency, effectiveness and productivity of your sales team, then that equates to increased revenue, which also goes into your business case. By considering the cost savings and revenue impacts just described, you can more easily come up with realistic ROI numbers for your business case to sell to upper management. Fortunately, since Salesforce has a low cost-of-entry and is virtually usable out of the box with little or no upfront customization costs, this will help balance the cost versus savings and revenue increase numbers for a more favorable business case. Since it s all about the bottom line, make it easy for management to see how your Salesforce project will pay for itself. - 6 - ASPE-IT a
The Project Plan One of the most important aspects of successfully implementing a Salesforce solution is to plan for a phased rollout. Sales people are busy selling. If you give them too much to learn and use too quickly, they simply won t use it. So feed them small pieces at a time. The initial rollout should require some core competencies; perhaps just some contact management and scheduling. The second phase can introduce additional functionality, such as opportunity management and forecasting. The next phase could include integrating email and custom letters and reporting. And so on. A little at a time works a lot better than all at once. Training Personnel Training is critical to the success of your Salesforce project. It s inconceivable to just throw a sophisticated product at an individual and expect them to start using it productively and successfully without some formal training, while they re trying to do their job at the same time. The training should include content for how to use the new system (e.g., what buttons to push) as well as how do I use it for the way we operate our business (e.g., reflect your sales process). The scope of your Salesforce training program will depend on the specifics of your implementation. In general you should expect to launch a training initiative that addresses the following job roles/functions: Application Administrators This group will include any IT professionals and other personnel who have responsibility for configuring, administering and handling maintenance on your company s Salesforce deployment. Developers This group will include any professional charged with handling the development of applications that will integrate with Salesforce, integration with other programs and data sets, as well as customization of the Salesforce deployment. End Users This group includes any personnel who will be using Salesforce once it is deployed to your organization. Salesforce is widely used from entry level staff all the way up to Executives. Don t just provide training, but also allow for the individuals to be out-of-pocket and nonproductive for the brief time that s required to learn the new system. It is also useful to allow for a learning curve over time. For instance, once they go through classroom training, they ll still need time to acclimate themselves to the new system and use it in their day-to-day operations. Benchmarking and Measuring Success Finally, the path to success will include a benchmarking phase. You ll need to establish milestones to measure against and audit your results. Without measuring how you re doing, - 7 - ASPE-IT a
you ll never know if you get there. Of course, you first have to know where you want to be, so be sure to figure that out as well. Establishing your criteria for success may seem obvious, but it is often times overlooked based on the assumption that the system must be better, therefore it has to be good. This usually doesn t fly with upper management, including the CFO who needs a justification for the expense of implementing this solution. Therefore, set the measurements for success right from the outset. What are your business performance targets? What are your technical performance targets? How will this system help improve your business? How will it enhance the relationship between your company and your customers? How can you measure satisfaction of your organization, workgroups and customers? If you cannot answer these questions, then how will you answer senior management when they ask you what this expenditure did for the company? Use all these measurements as focal points throughout the implementation process. And don t forget to continuously solicit feedback from the participants and team members. These benchmark results are necessary to measure against, but they should also be definable. The questions you need to ask yourself that were just mentioned are important, but you also should include specific measurable results. These are just some of the measurable benchmarks to consider: Sales Revenue Cost per Sale Average profit margin Market share Units sold Increased qualified leads Number of calls/visits per day Shorter transaction times Customer satisfaction criteria Increased revenue, profits, ROI, etc. Rolling it Out The first thing that should be remembered is that this may not be packaged software you re dealing with and may need initial customizations to work for your environment. So you may need to get specialized assistance from an outside organization or consulting firm who is experienced with implementing your CRM system. Fortunately, Salesforce is useable right out of the box and can be rolled out relatively quickly. What should be done initially, however, is to configure it around your specific sales process and methodologies so your team is using it in a manner that best fits your business. This is a simple process with Salesforce. - 8 - ASPE-IT a
When you re planning for Phase One of the implementation, start out small and grow gradually over time. Be flexible and responsive to the users when they have problems or when they ask for more features and changes. A good way to begin Phase One of the rollout is with a pilot program. Carefully select a pilot group from mixed experience levels, from veterans to newbies. Next, determine a pilot end date -- say for 30 days. Otherwise the pilot will last indefinitely with no specific milestones. You should also provide an outlet for comments and recommendations about the pilot program. The pilot serves as more than just a proof of concept. It s not a prototype. The difference is that the pilot is with actual users who use the system for real with live data, not just as a test. Think of the pilot program as a mini-phase One Rollout, just to get things kicked off. Most important, get your sales people hooked with quick wins they ll easily use right away. For instance, get them using the easy calendar system built into Salesforce. If your users insist on using Outlook for scheduling, that s not a problem because Salesforce allows for an easy and transparent synchronization with Outlook. This way, even if users enter calendar events (meetings, calls, to-do s, etc.) in Outlook, they will still be recorded in Salesforce s calendar system and can easily be tracked and reported on within the system. Another quick win is using the Account and Contact functions to track all their prospect and customer information. Salesforce has a very simple interface for entering and searching on this important information. And going back to the Outlook integration, Salesforce can pull in emails from Outlook and associate them with the appropriate Contact so users can track all emails within the History log for each Contact and Account. This will not only help your sales reps keep better track of their sales cycle, but management reports will be more meaningful and useful with this sort of data tracking. Once the users see how Salesforce can benefit them and help with their selling efforts during the pilot, you ll get buy-in from the rest of the sales organization. Make sure you solicit their inputs. Ask them what they want more information, better communication, improved quality of life. Then address their needs. Don t just provide for training; do it off-site so they are not interrupted by their normal work activities, and so they feel that you and your company are committed to this project. Also, provide for a central point of information for help, suggestions and guidance. It s important that they are not left to feel deserted and abandoned. Phase One should focus on basic implementations specific to your core requirements. This will include primary contact management functions, contact/account specific information, scheduling, standard reports, and other fundamental requirements without over complicating the initial rollout. Concentrate on quick win and high-impact functionality and priority requirements. There s always time to add more functionality as you move forward, but don t get tempted to do everything at one time, otherwise you can overwhelm your sales organization and turn them off to the entire project. Phase Two, and beyond, can include forecasting and opportunity management, workflow automation, mail merge using simple email and letter templates, quota tracking, more advanced reporting, and additional features aimed at productivity improvements. Following that, you can - 9 - ASPE-IT a
focus on Marketing requirements, such as marketing campaigns, lead tracking, drip marketing, and more. Salesforce is very effective at adding functionality in incremental stages. And since it is a hosted solution, as you roll out additional phases you do not have to do updates for each individual user nor to their PCs. It gets updated in one location and everyone has access to those changes when you are ready to roll out the next phase. Major Components Your Salesforce rollout should be broken down into six discreet components. Discovery Configuration Installation Administration Training Benchmarking 1. Discovery. This is where you take the requirements you identified in your planning process and start setting up the system to capture the proper information and determine how it should be presented and/or reported, whom should see what information, what the maintenance procedures will be, how to distribute technical updates, and more. With Salesforce, the tools and functionality included make it easier to focus on the requirements rather than how to apply them. 2. Configuration. This is where the database structure is tailored to your exact and initial needs -- fields are added, forms designed, reports customized, etc. which are all a rather simple process with Salesforce. 3. Installation. This is the step where you prepare your environment for the new system security, remote connectivity, hardware, etc. This is also when you clean, convert and import your existing database(s), if any, into your new system. Since Salesforce is a hosted solution (SaaS), you don t have to worry about installing any software or components on local PCs. Access is virtually from anywhere you have Internet access and can be through your browser or smart phone. Given the powerful and flexible importing capabilities of Salesforce, converting legacy data is usually a straightforward process. 4. Administration. This is where the system and user security is set up, menus are tailored to meet specific user needs, your sales process steps are reflected in the system, views are created to capture relevant information, the user and group hierarchy is established for record access, and more. As previously discussed, Salesforce provides for simple, yet powerful, configuring so these administrative functions allow businesses to set up the menu systems, sales processes, forms, user security and more, without doing any programming or system customizations. 5. Training. The amount of information that should be included in the training course should be limited to the core competencies that are required to get the individual users productive as quickly and easily as possible. Try not to overwhelm them with too much information it won t be retained nor remembered, even for a user-friendly system such as Salesforce. The training should not only include features, but also how the product should be used within your organization how your sales process works within the system, how opportunities should be entered and tracked, what probabilities to assign to forecasts based on levels of activities with the account, what codes need to be entered in order to track particular - 10 - ASPE-IT a
activities, and more. How to use Salesforce to enter this information is easy the challenge is in training the users on your business and sales processes when using the system. 6. Benchmarking, or How are we doing. About sixty or ninety days after the initial rollout, you should measure your progress versus your original goals and objectives. This should be repeated after every phase of the rollout program, as well. Review your training. Was it effective? Is more needed? What were the projects successes and mistakes so far? What goals have you hit and which ones have you missed? Define what course of action needs to be taken from here, or what changes need to be made to Salesforce and your processes before proceeding. This is also the point where you discuss and plan your next phase of the project. Budget Appropriately Since a major part of the planning for your Salesforce solution must include costs, this is a critical concern within most companies. But what should the budget include? It s easy to assume that the cost of the software could comprise the majority of the budget, especially in the days of on-premise pricing (pay up-front license fees to own the software). While the software cost could represent a major percentage, depending on what product is chosen for implementation, it typically should be just one of the many pieces that make up the whole. In fact, depending on the company s exact needs, plans and requirements, the software cost could easily be the smaller percentage of the total cost, especially when you consider today s hosted solutions (only pay a monthly fee) such as Salesforce. As it turns out, the software cost is only one piece of the pie. Additional costs include hardware, customization, training and support not to mention other inherent costs associated with lost productivity of the individuals while they re learning to use the system, downtime associated with implementing the system, and other soft costs. Let s take a closer look at each of these items. Hardware It s not enough to say, My sales reps already have laptops, so my hardware expenses are already taken care of. When you consider that the CRM system may require their existing laptops, and even their desktops, to be upgraded with more memory, larger disk drives, faster network access, and more of the latest technologies to ensure their systems are fully functional, then perhaps they are not quite ready after all. Since Salesforce is a hosted solution (SaaS model), the hardware requirements and dependencies are dramatically reduced versus the more tradition, on-premise model. But that doesn t mean you should not consider using more state-of-the-art hardware technologies where needed. For instance, today there are a variety of alternatives for remote users to access the central system and database. For one, the tablet PC has become one of the de facto solutions for the road warrior, specifically the ipad. So this may add to your procurement costs. Access to the Internet for your road warriors may require purchasing wireless network cards for them to access - 11 - ASPE-IT a
Salesforce from anywhere at any time. Additionally, users may want access to their Salesforce data from their smart phones (i.e., iphone, Android). All these issues and requirements may add to your hardware budget as well. Keep these considerations in mind when planning your hardware requirements and budget for it appropriately. Software There may be fifty ways to leave your lover, but there are over 200 ways to automate your sales force. That s how many products, by some counts, are available today that do some sort of sales force automation, CRM or even simple contact management. CRM software products vary dramatically in price and functionality. For on-premise solutions, prices for high quality and fully functional CRM products can range from around $500 to several thousand dollars per user, paid up-front, plus an annual maintenance fee of around 20% of the purchase price. Hosted solutions (or SaaS, Software-as-a-Solution) are paid on a monthly subscription basis. Salesforce is modular and you pay for the components you need, costing from around $65 per user per month for a complete Salesforce system, to around $125 per user per month for an enterprise solution. Add to this the costs for an e-mail system, presentation software, office suites, quotation systems, proposal writers, and more, and you can easily see how a user can carry around $2,000 to $5,000 worth of software on their laptop. Customization Since every organization is different, and every department within an organization is equally diverse, it is imperative for a CRM solution to be tailored to meet the unique requirements of its users. These customizations vary widely depending on the requirements of each department and user as well as the priority of these individual requirements, which dictates when they need to become available. Clearly, it is advisable to roll out changes to the system in reasonable increments over time, thus allowing the individual entities to absorb them, learn them and use them as they become available, without being inundated by too many new features and functions simultaneously. In the world of Salesforce, many, if not most, of the customizations actually involve just configuring rather than customizing, since they don t require changing system coding nor require any programming expertise. It s more a matter of modifying and adjusting parameters and settings within the system. This approach helps reduce the cost of your customizations, but these costs still need to be factored into your budgetary planning. The costs for performing the customizations will vary and will probably continue at some level over time. While this portion of the cost of your system is difficult to estimate, you can limit some of the costs by controlling the amount of customization required initially, and at the same time plan for future changes, thereby spreading the costs over a reasonable period of time. The - 12 - ASPE-IT a
scope of costs for customizations can range from hundreds to thousands of dollars per user. One must be careful to remember that a lot of customizations on the front end not only increases the initial rollout cost, but also can dramatically delay the release of the Salesforce project to the users and increase the training time required before a user can adequately run the system. Keep in mind that exceeding the budget and project delays are two of the top culprits for why many implementations do not meet expectations. Training Good training is required Period, end of story. Anyone who thinks that they can release a powerful system that will automate and streamline their sales and marketing operations and increase the productivity of the users without proper training is fooling themselves and risking a failed project. There are three levels of training that needs to be considered. First, training might be required for basic computer usage, such as Windows, word processing, proposal generators, presentation software and the like. An inventory of the skills of each user needs to be performed and then the appropriate training should be provided to those who need it. Second, there s basic usage of the Salesforce product itself; such as which buttons perform specific functions, navigating the user interface, mail merging, using the calendar, email usage and other basic functions. Third, and most important, is the specific ways in which the product should be used within your business. In other words, how will Salesforce help to execute your sales processes? This includes -- what business processes should be followed, workflow management, document management, opportunity management, how it is applied to your unique forecasting methodology, and task delegation. Basically this is training on how the system should be used to reflect the way your company uniquely wants things done using this new technology. Training costs can range from $500 to $1,000 per user depending on their pre-existing knowledge. Typically, a half-day course on basic system usage for the novice, plus another day on the new product, should cover the basics. Another full day or two may be needed for learning to use the system as your company intends on having it used (i.e. your business and sales processes). Training should not end when the student leaves the initial class. On-going training is essential to reinforcing basic concepts and policies as well as to introduce new functionality that gets added to the system. Sales people especially are too busy to stop and learn a new system, even if you initially only rolled out basic functionality. Therefore, you should expect the rate at which users adopt the system to be slow and to provide additional training opportunities to remind them what they learned in their initial class. As you roll out new features over time, don t forget to train them on those as well. On-going training can be delivered in a classroom environment as well as in a virtual setting (remote training) to help reduce costs. Be sure to factor all this into your budget. - 13 - ASPE-IT a
Support Support and maintenance must be included in your cost estimates. With Salesforce, maintenance is included in your monthly fees, which means the system will automatically be upgraded and updated by the vendor as needed at no additional cost to you. However, you should still consider getting support from the reseller or consultant who helped setup, customize and train your company on the project since you may need to continue some of these services over time, not to mention to have someone to call for technical questions and assistance. You should also factor in the additional costs for your own internal help desk. This would be the individual(s) your users will call back at your headquarters when they need help. Also, loaner equipment for sick hardware, replacement units and similar costs should be included in your estimates, as well. Industry estimates for support tend to run between $1,000 and $1,500 per user per year. Ready to Go By now you should have a good handle on what it will take to implement your Salesforce project. If you re not scared away by now, there s a good chance you re ready to plunge into the joyful world of customer relationship management and benefit from all the productivity gains it can offer. The bottom line is Be committed to your Salesforce project and don t skimp. Form a team, commit the time, spend the money, and plan, plan, plan. And by all means, pick a good, reliable and reputable product, like Salesforce. It will be worth its weight in gold. Russ Lombardo President PEAK Sales Consulting russ@peaksalesconsulting.com www.peaksalesconsulting.com - 14 - ASPE-IT a