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Barriers to Entry
A WSG survey uncovers the primary roadblocks companies face when implementing CRM.
For the rest of the March 2002 issue of CRM magazine please click here
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CRM may be all about creating barriers to exit, so customers stay customers. But CRM itself sometimes faces significant barriers to entry. That is, companies wanting to implement CRM often hit numerous roadblocks. In fact, a recent in-depth survey of high-level sales and marketing executives from 20 Fortune 1,000 companies conducted by marketing research firm The Willard & Schullman Group Ltd. (WSG), based in Greenwich, Conn., uncovered eight primary barriers to organizations embracing CRM. The study examines management's understanding and use of enterprisewide CRM. WSG learned that many CRM projects fail because they start from the view of how a company can improve productivity or efficiency, rather than how it can solve customers' problems and fulfill their needs. This company-focused view is a primary source of the eight barriers that once adjusted can help pave the way to circumventing them. For CRM to succeed companies need to start everything from the customers' point of view, says Bob Shullman, president of WSG. But according to the study's findings, CRM initiatives usually are created from the company's point of view. "Companies have preconceived notions of what they want CRM to do. If you ask them, ‘What about what the customer wants?' They'll say, ‘What customer?'" Shullman says. "Or they'll say, ‘We don't have to go to the customer, because we know what they want.' And if you ask how they know, they'll reply, ‘We just know.'" Indeed, most companies implement CRM to reduce costs and increase productivity, the study finds. Too few firms are truly committed to making improvements for the direct benefit of the customer. "Companies pay lip service to CRM," says Rebecca Margulies, executive vice president of WSG. "They say, ‘This is what the customer wants,' but they're not going to the customers to really find out.'" If a company is truly committed to listening to the customer, then some of the eight barriers to CRM will go away, Shullman says. But that's just the beginning. Companies also need high-level executive involvement--from the start. Without these two, any CRM initiative is doomed to fail. "Companies need to have both for CRM to work," Shullman says. "Executive involvement and customer input are the two linchpins to successful CRM. Get them done and the company will have a fighting chance to get a system that will indeed reduce costs and increase productivity."
In other words, as the study uncovered, it's time to start using CRM systems to solve customer problems, not company problems. --Ginger Conlon
8 Barriers to Successfully Implementing CRM 1. Lack of a consistent definition of CRM. Some individuals or groups within companies believe that they are doing CRM, when in fact they are not. They are using a tool to automate day-to-day tasks, instead of using CRM strategically. 2. Employees are comfortable with the current ways they are conducting business, so management finds it difficult to get those employees to buy in to change. 3. Silo mentalities still exist in many organizations. Either departments hesitate to share information, or their back-end technology does not enable them to readily do so. 4. It can be difficult to get all employees to work in the same manner and embrace one business philosophy, especially in large, complex organizations. 5. Unless companies create specific numeric metrics with which to track CRM, it can be difficult or impossible to quantify its results. 6. Salespeople who feel they own their customers and don't want to share that customer information within the enterprise can be difficult to win over to accepting CRM. 7. Marketing people who want cast a wide net to reach as many customers and prospects as possible, rather than employ target marketing, may resist using CRM. 8. Companies that work from a number of databases may find it challenging to either create one comprehensive, new database or find the right technology to effectively link the existing databases. --G.C.
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