This article talks about some of the reasons CRM projects may fail. That doesn t mean our own projects fail! In fact, a common situation we find is where a new Sales Director has inherited an old, legacy CRM system. The existing system is not used consistently across the sales and marketing teams, with many users having reverted back to their own individual spreadsheets. The data within the current system is full of duplicates and omissions and may be at risk if the support contract has lapsed. Overall, the existing system is providing limited value to the business. So, how did this situation arise? Most likely, it stretches right back to the selection process for the original system. 1. No clear business case for the CRM project Looking back through the conversations we ve had, the most common reason quoted for implementing a new CRM is to get control. Whilst these intentions are good, it doesn t necessarily give you any tangible business goals that you can measure the results of your project by. If you weren t clear why you bought a product in the first place, then how will you know if the project was a success? Think through your reasons for implementing a new CRM and ask yourself what results you hope to achieve. Try where possible to put some real numbers to these thoughts. If you don t already have a CRM system then it may be difficult to provide exact numbers, so your best guess will do for now. As an example: You want to get control because you feel that a percentage of sales leads generated are not being properly followed up by the sales team. They tend to cherry-pick the good leads and dismiss the rest as junk. This frustrates the
marketing team and is a waste of the marketing budget. More importantly, however, it is a waste of potential sales revenue. The numbers might look like this: A. Leads generated per month: 100 B. Cost of lead generation per month: 4,000 C. Average cost per lead (B/A): 40 D. Leads not progressed (best guess): 20% E. Wasted marketing budget per month (B*D): 800 = 9,600 per year. F. Average number of leads required to make a sale: 5 G. Average value of a sale: 5,000 H. Estimated lost revenue ((A*D/F)*G) = 20,000 = 240,000 per year Even if you only realise half of the desired improvement then you still have a business case for spending, say, 5,000 per year on a new CRM system. This would be based on a potential revenue increase of 120,000 per year. The question is then, how might a CRM help you achieve those goals and will you stay focused on those goals? 2. Losing sight of your goals As you start to evaluate potential CRM systems you may lose sight of why you were investing in a new product in the first place. Every product has its own bells and whistles that can easily distract you from your original objectives. To ensure success you should stay focused on your original goals and ensure all the must-haves are
addressed. To help keep track of your goals you could draw up a list of requirements. An example of a CRM requirements document is available on the WorksIQ website. In the previous example, we identified that leads were not being followed up properly. Some common reasons for this are: A percentage of sales leads never get logged in the CRM Some sales leads are left unassigned and lack ownership Some leads are too easily dismissed as junk or deemed no opportunity Manually entering junk leads into a system is time-consuming and is of no apparent value to a busy sales person who is looking to meet their quota. The problem is, however, that unless you feed information back to your marketing department about the quality of leads, then nothing will change and your sales team will continue to receive poor quality leads. To address the problem you need to close the loop and make sure everything is logged and fed back to the marketing team. We call this closed-loop marketing. So the questions to ask might be: Can sales leads be automatically created from emails and web forms? Can unassigned leads be easily identified? Can users easily log their own leads manually? Does the system encourage users to progress leads properly? Can marketing easily drill down into leads and outcomes?
From the vendor s website or marketing information, the answers to all of the above may be yes, however, you need proof. This leads us to another crucial element of product selection; namely testing. 3. Lack of evaluation In many cases, CRM projects that fail tend to do so because there was a gap between the say-so of the CRM sales person and the assumptions made by the buyer. Most CRM vendors offer a free trial system. You should take time to have a thorough evaluation of the product. It is not sufficient to just log in and have a quick click around. Neither is it sufficient to just sit your team in front of a slick sales presentation and assume that the product will work well on a day-to-day basis. When evaluating, you should log and progress some real-life leads in the system. Ask yourself the following: How do leads enter the system? If leads are generated by web forms or email then can they be automatically logged into the system? If so, will users be alerted when a new lead arrives? Do I have the right fields to log all the information I need? If you are not sure then ask the vendor if the system can be customised. Can I progress a lead from start to finish? Think about the various stages of the lead, including how leads are assigned, responded to and closed off. Do I have the reports I need? Can I easily get sales forecasts? Can I see activity levels, such as the number of appointments set by a user? Can marketing identify which lead sources are working best?
Can I import my existing data into the system? If you are unsure then ask your vendor to import a sample of your data into the system. It is unlikely that you will have no active leads at the start of your CRM project, so these will need to be loaded into the system. Similarly, old sales data will play a big part in account development and old leads may resurface, so again you must ensure this data can be loaded up for future reference. Evaluation is time-consuming but should also be a key part of your selection process. In larger organisations it may even be sensible to procure a small system on a shortterm contract. This would enable you to run a pilot scheme on one team for a number of months. 4. Lack of customisation As part of the evaluation process above, you should identify all the areas of customisation required. Customisation ensures that the correct information can be recorded and the right information extracted. CRM projects sometimes fail when the expected customisations don t work as intended or never actually get implemented. Where necessary, you should obtain written commitments from the vendor that your requirements will be met. Customisation also helps reduce resistance to change. Changing system terminology to match your own and branding the system with your own company logos and colours can give your teams a greater sense of ownership and involvement. 5. Resistance to change Users have got used to the way they do things at the moment and probably don t see a reason to change. If users do not universally adopt your new system from the outset then the chances are that your CRM project will fail in the long run. Users will
revert in part to their old methods and your successor will start the whole buying cycle again. To reduce resistance, consider your stated purpose for the new system. If your reason is to get control then this probably drums up negative thoughts in the minds of your team (e.g. big-brother is watching you). However, if your stated reason is to increase sales revenue by 240,000 per year then your sales team will be more focused on their increased commission levels and you have a much better chance of getting their buy-in. Ideally, the users buy-in should start from day one of your selection process. All too often, a user s first awareness of the product occurs after it has been purchased, resulting in a natural resistance to the change. The downside is that, involving users in the selection process will most likely complicate and delay the decision making process. However, it is far better to identify problems and requirements from the outset than it is to try and shoehorn a system after purchase. 6. Lack of training If users are uncertain about how to use the new system or don t know the significance of certain fields then your CRM project may be heading for failure. Moreover, if you require a significant amount of training or if you need reams of user documentation to operate your new system then you are probably buying the wrong product. CRM systems are supposed to make your life easier, not more complicated. The main learning curve should have already taken place during the evaluation process, not after the sale has been completed. Training, therefore, should ideally be a bespoke, in-situ, process to get your teams up and running quickly. The focus should be on making sure the day to day processes are understood and working as expected. The best way to avoid failure is to involve key users in the evaluation process. The key users should then also be involved in the training sessions to help bridge the gap between the vendor s terminology and your own.
An added bonus of including bespoke, on-site training in the scope of the project is that you increase the buy-in of your vendor. No CRM trainer likes to be thrown-in blindly to a new client, especially if there is a gap between what has been promised and what can be delivered. So, ask the vendor who your trainer will be and try to make contact prior to the event. The trainer will then have a vested interest in making sure that their product is fit for purpose. 7. Lack of measurement After the new CRM system has been adopted you should measure the desired improvements against your original goals. Measurement of results gives you the evidence to determine whether your CRM project has been a success. If you didn t have any hard figures on which to base your goals then it may be necessary to start by base-lining your data first for a period of one to three months. After this, you should measure your results after three and then six months. It is important that you review this data with your vendor, especially if the results are not working out as intended. Some fine tuning to the system or processes may easily rectify the situation and your vendor should be able to advise you on this. Summary To ensure the success of your CRM project, here are the seven suggested guidelines: 1. Set clear goals and objectives for the project 2. Stay focused on your goals and don t be distracted by irrelevant features 3. Thoroughly evaluate your intended solution prior to purchase 4. Ensure the CRM system can be customised to match your requirements
5. Involve key users early in the selection process 6. Include at least some element of bespoke training to increase vendor buy-in 7. Measure the project against your original goals after one, three and six months and review with your vendor. WorksIQ CRM WorksIQ is an easy to use, web based CRM. It allows you to manage sales leads and support enquiries and provides complete visibility of your customers and contacts. We provide a free 30 day trial of our software and since there is no software to install or hardware required, you can be up and running immediately. To make your task easier, we will assist you with your evaluation and can provide a full set of services should you wish to purchase the product. For more details please call 0118 978 6161 or visit our website www.worksiq.com.