Companies burn so much money on CRM software. In our experience working with B2B firms, we have seen how resistance from the sales team forced a company to shut down a majority of the modules and look for a replacement. One company couldn’t spec the software to its existing processes and let its contract expire. Another abandoned a project after two years of significant misalignments with its needs. So what went wrong, and how can other companies ensure they succeed with their software investments?
Why do CRM software attempts fail?
The reason is clear: The companies mentioned above tried to implement the software without clarifying their commercial strategy, processes, and needs. The long history of failures with CRM offers some insights into why this happens and how to avoid it. Originally started in order to grow the business, most CRM projects ended up creating an additional administrative burden that slowed down sales activities massively.
What should software specification and implementation look like?
CRM is supposed to bring major improvements in lead generation and conversion by providing sales with better and more reliable information. But a company cannot gain this advantage unless it fully understands its current ways of working. What information sources do individual stakeholders in the sales process currently rely on, and how do they access them? Improvement will only be possible if the additional data sources or advanced analytical tools put sales teams in a significantly better position. User centricity is key when setting up the CRM solution.
CRM is also supposed to increase customer loyalty by creating a more consistent and seamless customer journey along the different touchpoints. This requires a full understanding of the existing touchpoints, which typically extend beyond the sales organization. Marketing, logistics, finance, or production might also interact with the customer on a day-to-day basis, and the CRM software needs to take these interactions into account. The pandemic and its aftermath make this challenge more acute: how did all these interactions change during the pandemic, and how will the customer journey develop post-pandemic? Customer centricity needs to be the driving force to dynamically adjust the CRM support to these new realities and reflect the new, specific requirements of customers and sales.
Finally, CRM software should lead to higher sales efficiency. An integrated system should provide salespeople with comprehensive customer information and help them make better decisions. But the lives of salespeople will only get easier if they consistently receive the right information in the right place at the right time. Picking the best digital support tools and devices requires a proper, comprehensive, and well-connected data architecture and a deeper look at sales processes. What is the set-up for customer meetings? What is the agenda? Which data does sales need for preparation? Advanced analytics with focused outputs help prioritize and filter information and prevent information overload. Here individual success stories support even large organizations on their transformation journey. Agile development of the solution and dedicated change management is required to secure sustainable success with the CRM.
So, what do you need to make your CRM software work effectively?
We see five success factors:
• Be crystal clear about what you want: Strategies and processes need to guide software specification and implementation. Identify and quantify your improvement levers. Have a detailed look into your current ways of working. Describe the target set-up and quantify the resulting improvements, then define the key performance indicators (KPIs) to measure success.
• Prepare your processes: Outline the targeted customer journeys and align internal processes to provide optimal support. This means defining the support requirements based on all customer interactions in close cooperation with the sales teams. Both customer centricity and user centricity are required here.
• Find the best digital support: Select the providers and tools that best match your requirements, with a clear focus on achieving a competitive advantage. Make the necessary adaptations to get a solution that truly fits your needs. If you haven’t clearly defined and harmonized your commercial processes, you may end up digitalizing complex and dysfunctional processes and spoil the system. Sometimes the management team underestimates that risk.
• Apply an agile approach: Specifically when it comes to CRM implementations, driving a waterfall approach and expecting a 100% perfectly fitted system at go-live tends to produce month over month of development work and dissatisfied stakeholders all over the company. Agile development is per definition designed to cope with the complexity of software projects. Go for the North Star but start with the minimum viable CRM system that you need. Don’t plan out every detailed requirement in much depth in the beginning, rather apply an agile approach and include the individual customer requirements for the solution in incremental, interactive cycles over time.
• Getting the transformation process right: The impact of buy-in of the sales teams on the sustainability of change cannot be overestimated. Tailoring actions to business specifics, mobilizing for change of status quo, and strengthening a "hands-on" mentality helps. If there is no buy-in, it will collapse.
These success factors address the two biggest pitfalls in a typical implementation process: starting a project before defining and clarifying the business needs, and failing to translate those business needs into exact technology and software requirements. Success depends on three factors: a deep understanding of the business, knowledge of latest software and technology to support it, and people who can talk to and unite both sides of that business-technology equation. The business knows its processes, challenges, and needs, but lacks IT expertise. IT consultants have knowledge of software types and vendors and know how software development works. They are the natural partner for the IT departments. But they lack a deeper understanding of the business specifics. Successful software implementation bridges these gaps.
“There are no secrets to success. It is the result of preparation, hard work and learning from failure.” – Colin Powell