Customer relationship management is in need of changes fast. Wrong perceptions and bad execution could take it down a path it doesn’t need to go. Who can we blame? There are the vendors that mistakenly aim their marketing and sales pitches at their potential customers’ CFOs and vice-presidents of IT, then whip customer expectations too high with promises of products they haven’t yet released. How about the systems integrators who make commitments for shorter implementation times and less cost than will actually be necessary?
Then we have the vendor salespeople who, in the name of getting the deal, promise customers technical wizardry that simply can’t be done. And what about user CFOs who want a return on investment in unconscionably short time periods? Or analysts who make their recommendations with far too much emphasis on CRM package functionality?
Finally, we have end users who don’t want to use the newly implemented applications because they’ve been using Excel for years.
These mind-sets lead to CRM’s oft-quoted 55 per cent to 75 per cent failure rate.
If changes on all sides aren’t made, CRM will hit the same walls that ERP hit two years ago. The irony is that many leading CRM vendors are also leading ERP purveyors – particularly PeopleSoft Inc., Oracle Corp. and SAP AG. Painful lessons can be learned from their past two years. Some have taken steps to fix their problems (PeopleSoft), some haven’t (Oracle), and some are just coming into the CRM picture (SAP). These same scenarios also apply to pure CRM companies, such as Siebel Systems Inc. The basic message: Make CRM work now, before it becomes ERP redux.
Don’t get me wrong. CRM is a superb value. The people who make and sell the software are fine human beings. But the rumblings are there, the problems exist, and we need to push for change.
What might those changes be?
First, the obsession with CRM functionality needs to end. If you overlap the major vendors’ applications, you find that most of the functions are identical. How well that functionality works is more important than how much of it there is.
Second, vendors and potential customers should focus on the end users, who should be part of the stakeholders’ team and involved in package selection from the beginning. The natural leaders in departments, those whom staffs look up to, should be the departments’ representatives on the customers’ steering committees. This empowers the end users into becoming evangelists who can excite their colleagues about using the CRM applications.
Third, systems integrators and vendor salespeople should promise just the earth, not the stars. They should remember that they’re not just landing a deal; they’re also striking up an ongoing relationship with a customer that’s expected to satisfy both parties. But at the same time, the customer should remember that vendors and integrators need to make a profit. Fairness, a seemingly elusive goal, does and can exist in these deals.
Fourth, CFOs need to stop trying to get immediate ROI. CRM systems are large and complex. Changes in the corporate culture are required before they will work. CFOs should be thinking strategically, not small.
Fifth, analysts need to use their formidable power wisely. Be less concerned with the CRM vendor’s position in the standings and more with application usability. The functions of a CRM application are less important than how easily and transparently the end user can access that functionality. The regard that users have for the value of CRM applications is more important than a vendor’s rank, despite what vendors or analysts may think.
Finally, to end users: Just use the thing. It’s to your benefit. Whether you’ve been at your company 30 years or three weeks, CRM can provide outstanding results. Spend the necessary time to learn how it works.
If all this happens, CRM can be the blockbuster of 2002.
If it doesn’t happen, it will be 2002’s busted block.
Paul Greenberg is executive vice-president at Live Wire Inc., a CRM-focused consulting firm. He’s also the author of CRM at the Speed of Light (McGraw-Hill, 2001) and is working on its second edition. Contact him atpgreenberg@live-wire.net.