Who to Blame When CRM Fails

Companies considering CRM systems often view them as a way to improve customer satisfaction and retention, boost sales and accelerate employee productivity. However, as with many technology-enabled business process, success is a complicated and interdependent proposition.

When companies are winning — demonstrating growth and gaining market share — the “if it ain’t broke, don’t fix it” mentality can breed complacency. Conversely, when sales are sluggish and customer churn is high, CRM solutions are often the first thing in management’s sights.

This is typically the point when a lot of companies fall into the trap of believing that a stalled or failed CRM initiative is the result of either the technology itself, the inability to prioritize customer needs, or a misunderstanding about the role that a CRM system plays in supporting their business.

After all, it stands to reason that success or failure hinges upon a system’s ability to scale to meet increasing market demands, integrate with existing IT investments, and offer a wide variety of functionality to accommodate various customer scenarios.

Look Inward

As IT and business teams re-evaluate a CRM system to identify and address the technology potholes that are stalling growth and profitability, there can be a ripple effect throughout the organization. This is due to the fact that many CRM systems, or at least parts of their functionality, extend to various other applications, such as enterprise resource planning (ERP), sales force automation (SFA) and supply chain management (SCM).

Given the overlaps and the time that’s spent on unraveling the source (or sources) of technology issues, it’s nearly impossible to determine who is responsible for a failed CRM effort. Nearly.

While any number of elements can and do contribute to the success or failure of a CRM effort, one of the biggest and most often overlooked stumbling blocks to CRM success is the company itself. All too often, an inordinate amount of time is spent assessing technology investments, and not enough time is spent understanding the importance of human capital.

More specifically, companies should look inward at their culture to understand how CRM was prioritized, introduced, sustained and evaluated before they point to external variables, existing technology or separate teams such as IT, customer service or the call center.

Intersection Gaps

At Panasonic Computer Solutions Company (PCSC), more commonly known as the Toughbook mobile computing division, we were experiencing high customer satisfaction and strong market share and demand. However, we weren’t aware of the toll that our existing CRM system was taking on our employees. Small gaps in productivity were impacting our bottom line and affecting employee satisfaction.

For example, reviewing and updating 20-30 critical spreadsheets per month took upwards of three days per employee. Also, because many employees were not properly trained on the system, we never fully overcame what was initially promised as a three-month learning curve.

These factors contributed to inaccurate forecasts, errors in the supply chain, and employee turnover. Even though our business was strong, we realized that these issues could, over time, erode our profitability.

After a careful evaluation, we determined that we, like so many companies, were the victim of gaps in the intersections of people, processes and technology. Rather than invest in an entirely new CRM system, however, we stepped back to take a holistic look at our CRM processes, which yielded some key learnings:

Socialize CRM from the highest levels of the organization. If you’ve ever worked on an IT project that failed, chances are good that the implementation work began before consensus was built.

By getting executive buy-in before purchasing decisions are made or when a revamp is necessary, you can start to socialize the business value of the effort from the highest levels, and that will make its way throughout the organization.

Share responsibility and ownership across the company. Create a cross-section of project leaders across the company representing various functions that will either be directly involved in CRM or will see it intersect with their responsibilities. This way, you can establish more realistic expectations, raise the profile and the value of CRM across the company, and identify and address many of the potential issues before the full rollout.

Invest in training and development. Dedicate resources to mastering CRM. While the system may seem intuitive or straightforward to many users, there is a big difference between knowledge and mastery.

Peer-to-peer training can be helpful once the system is in place, though outside expertise at the onset of the project is ideal. There are many CRM service providers, such as Accenture, Capgemini, and Deloitte, that can decrease the learning curve and accelerate the deployment based on technology expertise as well as in-depth industry knowledge.

At Panasonic, we opted for Infinity Info Systems, based on its experience in the manufacturing and distribution industry.

Continued assessment and feedback. Any CRM system should evolve to reflect the needs of a company. For example, we shaped our system to reflect overseas manufacturing, a sales force that doubled in two years, and a growing distribution channel.

Without continuously monitoring and evaluating how the CRM system was keeping pace with changes within our organization, the resources allocated to its success would have been wasted.

Additionally, when you continue to analyze the system against predetermined metrics, you can more effectively illustrate its value to the entire organization.

Through a more employee-centric approach to CRM that emphasized the human aspects of the effort, PCSC is able to share its best practices as other divisions look to emulate the project’s success.