OPINION

5 Things That Kill CRM ROI Dead

Back in the old days — like around 2003 — the rate of what was termed “CRMfailure” was unacceptably high. You often heard it bandied about that 70 percentof implementations were failures. That was an estimate — companies were notcoming forward to confess their CRM disasters, so building a scientific sample wasimpossible. Still, the number reflected the general dissatisfaction businesses had withthat generation of CRM.

A decade later, things are better. CRM vendors have focused on areas that usersidentified as sticking points, and users are coming to CRM better equippedto internalize the ideas of CRM so their own actions don’t lead to failure.

Yet there are still things that businesses do that sabotage CRM — or at least preventthem from capitalizing fully on the information CRM collects and makes available to sales, marketing and support.

Here, in no particular order, are the five worst offenders.

1. Replacing Information Silos With CRM Silos

One of the big selling points for CRM was that it could expose information aboutcustomers to every part of your organization that could use it. For example, knowing a customer’s recent experience with your service organization could benefit sales; accessing information about recent new customers could help marketing refine its lead-generation activities.

Many organizations fail to get that deep — CRM is brought in because of a major sales or support fail, and it’s set up to serve that organization. Integrations with other applications may be neglected; worse yet, training may be limited to solving current problems.

After a while, you’ve merely shifted your customer data from one siloed system to another one. When it eventually occurs to someone that the information should be available to everyone who needs it, processes will need to be unraveled and a new silo must be broken down.

2. Sales and Marketing Infighting

You can have the most effective CRM system in the world and see it squanderedby the classic “misalignment” problem. CRM data can be used to evaluate whatqualified leads look like; which marketing campaigns lead to closed sales; or whichcustomer interactions signal an opportunity for an upsell.

However, a lot of businessesnever get to the analysis that delivers these insights because they require input fromboth sales and marketing — not input into CRM, but input into discussions about howto work together and then use that CRM data. Without these discussions, there’sno thought about these insights; thus they go undiscovered.

The solution is to getsales and marketing in a room to discuss the goals they have in common; if you canfocus on sales and marketing’s shared objectives, the two sides are likely to find thatthe answers to their shared questions are available within your CRM application.

3. Generating Reports Just to Generate Reports

A good CRM application can present data in preformatted reports and keepmanagers updated on a regular basis. The key analysis is done automatically andit’s right there, ready to be read, understood and acted upon. Unfortunately, likeso many things in this technology-driven business world of ours, these reportsare often taken for granted and ignored.

The classic is the weekly report that amanager demands from an underling, which typically makes two stops in its lifetime:on the manager’s desk; then straight into the recycling bin, unopened, severaldays later.

Reports are not generated simply to enhance your relationship with yourtoner supplier; there’s a lot of great data inside them, organized to make it easy andquick to understand what’s going on and what new opportunities exist for you. If you don’t read them, reports are as helpful as a concrete life preserver.

4. Using Social Media as a Broadcasting Medium

We’ve all seen businesses that grasp social media’s potential for reaching vastnumbers of customer prospects — and who then abuse that potential. Thesebusinesses are missing more than a simple sense of etiquette. By being completelyfocused on blasting their message out through social media, they’re not listeningfor the valuable insights their customers could be sharing in return.

The culpritsin most such cases are old-school marketers who think they can still control theconversation. When they try to overload social media channels with their messages,they shut down conversation and deprive their businesses of the intelligence thatcan be gleaned from intelligent conversations with customers. If you want to takeadvantage of the ideas of social CRM, you need to first understand the two-waynature of social media.

5. Creating ‘Relationships’ That Don’t Extend to the Customer

Businesses often view what’s going on with customer relationships in the contextof the business. They have a good idea of what they’re doing to foster relationships,and those things correlate to what experts say are the best practices for CRM.

However,instead of corroborating this with the most important people in this mix — thecustomers — businesses make the assumption that all is well and they are livingin the best of all possible worlds. It’s unpleasant to have your reality upended, soit’s easy to tell yourself that your business is doing a great job of understanding itscustomers and building relationships with them.

Your customers mayhave a different view of this, though. Even if things are hunky-dory now, customers evolveand change, and assuring yourself that all is well prevents you from evolving withthem.

CRM Buyer columnist Chris Bucholtz is a speaker, writer and consultant on topics surrounding buyer-seller relationships. He has been a technology journalist for 17 years and has immersed himself in the world of CRM since 2006. When he's not wearing his business and technology geek hat, he's wearing his airplane geek hat; he's written three books on World War II aviation.

1 Comment

  • "A decade later, things are better." Might I ask, in what way? Estimates for the last 10 years have still fluctuated between 70 and 50% adoption failure, and that’s probably being kind. To be honest, the problem hasn’t been solved because CRM companies in general haven’t actually solved it. Poor adoption is the symptom of a disease in the industry. The problem is that the industry keeps treating the problem with the wrong meds.

    They keep buying and acquiring, they keep building higher and higher. Instead, and what is pointed out in this article: http://www.jobnimbus.com/how-to-solve-crms-abysmally-low-adoption-rate/ is they have to take a step back and try to understand that the disease comes from poor UI and UX.

    All of these points you mention in your article are helpful to the CRM user, but the greater issue that will be most helpful towards successful CRM adoption is finding one of the few CRM software out there that is simple to learn and use. Once you’ve found something you can actually learn, then move on to the next steps provided in this article.

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