3 CRM Implementation Failures and What We Can Learn from Them
In 2017, CIO magazine reported that one-third of all customer relationship management (CRM) projects fail. Edinger Consulting Group founder and Harvard Business Review blogger Scott Edinger, on the other hand, found that the failure rate for customer relationship management (CRM) implementation may actually be as high as 90%. He found that most companies don’t know how to use these systems, so they are unable to maximize their CRM software for profit.
Poor user adoption is cited as one major cause, rather than the technology itself. So what can be done to ensure the successful, company-wide integration of CRM for a positive ROI? Address the roots of your problem: your objectives were unclear, there were implementation missteps, or the CRM wasn’t nurtured properly.
We’ll look at these three ways CRM implementations fail and the steps to improve your own CRM strategy.
Signs of a Failed CRM Implementation
How do you know if your CRM was not properly implemented? What are the signs you should look out for? We’ve narrowed it down to three major signs: “dirty” data, a lack of involvement, and a failure to disrupt your current system.
Having dirty data means your system is filled with duplicate, incomplete, or flat-out bogus data. In fact, one study suggests that an average US company believes that 25% of their data is inaccurate. An accurate database requires a lot of effort from end users and CRM administrators. However, if they aren’t seeing the value of these business processes, then they are less likely to input the correct data consistently.
Lack of involvement
Lack of involvement from end users can cause your business a lot of problems, such as the one mentioned above. Companies often don’t involve the actual end users until the CRM system is about to be deployed, which makes them adverse to these sudden changes.
Similar problems arise from a lack of involvement with the IT department, when companies fail to include them in the CRM selection and pre-implementation processes. When these stakeholders and their perspectives aren’t consulted with, CRM adoption will encounter more obstacles in integration, customization, upgrades, and support.
Failure to disrupt
An effective CRM can and should disrupt a number of existing activities within your business. If your CRM is not changing the landscape of your business and how your employees operate, then it’s a sign of CRM failure Here are a few things to watch out for:
- Your sales team is more focused on administrative tasks over revenue-generating activities.
- A standard monthly report takes days to create.
- Your data remains disorganized and difficult to find.
- You have recurring customer service issues that take too long to resolve.
- You don’t have a sense of where opportunities are located in the pipeline.
3 Ways CRM Implementation Fails
1. The objectives were not clearly set beforehand.
A CRM’s primary purpose is to manage the relationships and interactions between your business, your customers, and your potential clients. Thus, your objective should be to increase customer acquisition or improve customer retention.
However, what usually happens is that the CRM system becomes a tool for internal inspection, rather than a strategy for improving customer relation services. If your CRM is only there to create reports for management, your sales team won’t see the value in properly recording information or studying interactions. As the end users, your CRM should be helping sales management create a better sales process.
Another problem with a lack of objective is that you will be tempted to buy into a CRM platform that covers a wide range of business functions: marketing, information, accounting, and so on. But this only dilutes the capacity of your CRM to nurture each customer relationship. Before implementing a CRM, it’s important to define your desired outcome so you can choose the features you actually need.
2. There were missteps during implementation.
In Halloween of 1999, candy manufacturer Hershey’s found that there were no orders for their candy, while distributors could not supply for their retailers. The company had invested in a $112 million system to modernize their business practices, and they had an aggressive plan to overhaul their processes. So what went wrong?
The project ran behind schedule because the company had decided to let a massive new piece of infrastructure go live at the same time. This is one example of an implementation misstep. Even well-planned initiatives will face an issue during this stage.
Two common challenges faced during CRM implementations are:
- Inadequately staffed teams:
An inadequately staffed team doesn’t mean a lack of talent, but that there might be too many technical people and not enough end users on the team. A well-balanced team should have skills in technical integration, change management capabilities, and functional business processes. Having a well-balanced team prevents skewed decisions and unclear goals.
- Falling into technology traps:
A technology trap is not a problem with the technology itself. Rather, it may be a lack of a proper plan, sufficient budget, or capable staff. Business decisions may be delayed and force IT teams to rush or make assumptions about how the technology should be implemented. Technological mistakes are time-consuming. Some of these “traps” include:
- Failing to spend time testing the technology
- Utilizing untested technology in critical situations
- Underestimating the cost and complexity of integrating new technology with old systems
- Over customizing the CRM platform so that its installation becomes buggy
3. The CRM was not nurtured after implementation.
If your initial CRM implementation and user adoption efforts were successful, the problem may arise from failing to nurture the system afterwards. CRM implementation is an ongoing process that involves constantly reviewing new approaches. Your business has to invest time in upgrading the platform and its processes.
Unless it becomes ingrained into the management process of your business, you always face CRM failure which will cost you money. Companies have to define what makes their CRM valuable so they can constantly scale the CRM alongside the business.
10 Steps To Help Your CRM Implementation Succeed
With a clearer picture of how CRM implementation fails, you now have to check your weak spots and learn to manage these efficiently. Here are ten steps that can guide you for a successful CRM implementation process.
- Choose the right CRM software for your team: Consider the strengths of each vendor, their experience, as well as customer references. Make sure to find a vendor who can offer you the best CRM software to meet your company’s needs.
- Create a CRM implementation team: Your team members should have strategic roles, or else the project will be a bust. A basic team should include:
- Project manager
- Application analyst
- Application developer
- QA test engineer
- Representatives from key user groups
- Forecast your implementation budget: It’s easy to overspend on a project like this, so take into account all possible costs for your baseline. You can also conduct assessments for risks and payoffs.
- Offer training sessions: Train end users with a mix of face-to-face, online, and practice sessions. By equipping your staff with the know-how, you will be able to boost their confidence in running the system itself.
- Reiterate internal user guidelines: Alongside training, it’s important to remind the end users on what, when, and how needs to be done with the CRM. Without consistency in the basics, it will be impossible to maximize more advanced features.
- Plan and initiate your go-live: A go-live period can be hosted over a number of stages, rather than executing it all in one day. This will allow you to test the system, weed out bugs, and monitor your team’s response. Your go-live will save you time later on, as your work to fix the initial crop of problems.
- Rollout with excitement: Never underestimate internal marketing. Find a special way to celebrate your launch to help build your colleagues’ confidence in the CRM. It doesn’t have to be flashy or expensive, it only needs to motivate your team further.
- Conduct regular testing: Oftentimes, a CRM implementation process fails due to a lack of testing. CRM testing will ensure that:
- Your data is protected
- The information can be saved and retrieved
- Reports and analysis can be generate
- Your CRM software works with other platforms
- Evaluate your performance: With the metrics available for evaluating CRM performance, you can effectively spot problems and coach your team towards improvement.
- Re-think your CRM: Your CRM is not here to fulfill administrative requirements. It’s a strategy that helps your sales team improve as the CRM allows them to access resources, manage territory, and review pipelines with ease. Use the CRM by aligning it with your overall business strategy. A few measurable, ROI-driven goals for CRM may include: increased customer acquisition, shortened sales cycle, increased revenue per customer, or increased customer retention.
Redefine Your Sales Process With Commence CRM
As an award-winning business solution for small to midsize businesses, Commence CRM is a desktop computer software that enables our clients to gather insights about their customers and enable management to make decisions based on what the company needs.
With its state-of-the art customer information database and powerful analytics features, you will be able to manage your sales pipeline, forecast revenue, and provide the best services for your customers. Try our CRM systems today.