Dears,
There’s been a lot of bad media propaganda about customer relationship management (CRM) technology over the years. While a lot has been made about CRM failures, the reality is that only a very small proportion of implementations actually fail in the sense that the system doesn’t go live. Remember Artificial Intelligence (AI), one of the biggest buzz - words of the 80’s? How about Computer Aided Software Engineering (CASE)? These technologies rarely got implemented even though companies spent hundreds of thousands of dollars attempting to do so. At the time, industry analysts had us all believing that these technologies were as important as the coming of the Messiah, yet all that remains of them are distant memories.
There may be several causes for the high failure rate in enterprise type implementations, but two primary reasons seem to surface to the top with small to mid-size companies. First, implementation of a comprehensive CRM solution often requires a fundamental change in the policies and procedures of how a company sells and supports its customers. Changing to a customer-centric business model, meaning always placing the customer first can be very difficult to implement. Employees have a tendency to cling to old policies and focus on better ways to manage their business rather than creating a better customer experience. This type of change requires strong commitment from senior management and must permeate throughout the organization. You can’t just speak it, document it in your brochures or place it on the back of your mission statement. You must execute it with passion. Without this commitment, even the simplest of CRM solutions will fail.
Where CRM has commonly failed is in its ability to positively impact the bottom line. As a thirteen year veteran of the CRM industry I’d estimate that 80% of CRM systems seriously under-perform their potential, with the majority generating very marginal, and in many cases negative value for their owners. Most systems are limited in scope, and usage tends to be occasional and unstructured. So how did we get into this state? Two reasons I suspect:
Firstly, CRM vendors are, in general, first and foremost motivated and equipped to sell software, as opposed to deliver benefits. They may truly believe their software delivers value, but there is a big gap between raw technology and an implemented system that generates operational benefit. In particular vendors have failed to appreciate the importance of analyzing and encompassing their clients’ business processes, and have struggled with user adoption. Secondly, for those systems that do bridge the gap, many have failed to remain relevant over time. This is often because there has been insufficient maintenance of the system, or the business and changed and the system hasn’t adapted.
While businesses may be able to overlook the fact that their CRM technology isn’t delivering on its promise in the good times, the tougher economic environment means that these systems are letting them down just when they need them most. The need to attract and retain customers has never been more pressing. The good news is that it’s often relatively easy to turn a CRM system round, and with the investment already made, this can often be achieved without significant additional expenditure.
Incidentally, if you aren’t sure whether your CRM system is performing or not, one quick check is to review the reports generated by the software. If you can’t find any useful, comprehensive, or accurate data about the running of your business you can safely assume your system isn’t doing a lot for you.
Back to Basics
There are massive benefits to using CRM technology to control your key customer facing processes. Not only does it facilitate a host of operational efficiencies, but utilising the notion that you can’t manage what you can’t measure, one of the key benefits is being able to continue to improve over time. Your CRM system may not be doing much to help you today, but getting things back on track might prove the difference between prospering and failing in difficult times.
If you look back at some of the most successful products in the past decade, you will find that hey were point solutions, providing narrowly focused capabilities such as contact management, product &pricing management and opportunity management. They were easy to implement, easy to use and provided immediate value to the user. This resulted in strong user acceptance. I began to ask myself why CRM solutions could not be implemented the same way, as point solutions. Who mandated that companies must tackle the implementation of marketing campaign management, sales management and customer support functionality all at once? Why does back office integration have to be completed at the same time? Add to this the changes in policies and procedures required to transform to a customer-centric business model and it’s no wonder that we are seeing so many failures in the CRM space. We are simply asking people to do too much all at once. It’s time we get back to basics and this resulted in the creation of my own simple methodology S.T.E.P, the Successful Technology Enablement Process.
S.T.E.P. takes a modular approach to your CRM initiative using a best practice guide to insure the successful implementation of one department at a time. S.T.E.P. recommends that you begin with the sales organization, automating the sales process first, and then move on to marketing, campaign management or the customer support functions. S.T.E.P. allows you to start small and break down the implementation process into pieces that are attainable, based on the customer’s requirements and resource availability. S.T.E.P. allows management’s commitment and involvement in each phase of the implementation. Management will help to facilitate workplace productivity, discuss the reasons for moving to a customer-centric business model and assist in maintaining complete control over the project. This is critical as the implementation begins to spread through the different departments.
S.T.E.P. Consists of Five Phases:
Step I Needs Analysis
During this phase of the implementation we document the strategic and tactical objectives of the department. We determine the process, workflow and functional requirements and identify areas where information needs to be tracked, shared and integrated.
Step II Project Planning
A formal departmental implementation plan will be created, and finalized during this phase. A system administrator will be selected to coordinate with members of the department as well the system integrator or consultant(s) managing the implementation.
Step III Installation & Implementation
Installation of the software, workflow policies and procedures will be implemented during this phase. System configuration, privileges, preferences and security will be determined.
Step IV Testing & Quality Assurance
An operational prototype of the departmental application is up and running at this time. Operational issues are identified and resolved, and basic modifications are made.
Step V Deployment & Training
The application is now completely operational. There are no additional installation activities. Training begins for departmental management and end users. Ongoing support is provided by the system administrator with telephone assistance from the system integrator or solution provider. Once the first department is operational, we will follow similar steps again for the next department. The specific details of each phase of the S.T.E.P. program, tasks and time frames are worked out with each customer. Using the S.T.E.P. approach, a typical installation of the sales system for a team of 10 to 20 sales representatives only takes 3 to 5 days.
The implementation of any CRM solution takes time and proper planning. The S.T.E.P. program is unique, providing customers with the ability to focus on specific components of CRM and insure their successful implementation before moving ahead and automating additional areas. Clearly, the real value of CRM comes from the integration and sharing of customer information while insuring that the solution works in concert with the rest of the organization. You can realize significant value and maximize return on your investment if you take it one S.T.E.P at a time.
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