• May 14, 2002
  • By David Myron, Editorial Director, CRM and Speech Technology magazines and SmartCustomerService.com

Analysts Feud Over CRM Failure

In a recent report from New York-based research firm, Datamonitor, called "Great Expectations But Not-So-Great Implementation: CRM in the Pharmaceutical Industry," the firm states "44 percent of pharmaceutical CRM projects either fail to meet implementation timescales or result in total project failure, a trend that is set to continue." The report cites organizational resistance and cost as the greatest barriers to successful CRM implementation. However, other industry pundits disagree. CRM consultants claim those that fail at implementing CRM do so because they fail to set predefined metrics in place that can be used to measure success and failure during the life of the project. The most common problem is most companies implementing CRM do not "apply good project management skills" and do not "set metrics that can help them define success or failure," says Scott Nelson, vice president and research director for Gartner Group. Without a predefined set of metrics each employee involved with the CRM implementation will have separate expectation levels, and therefore, the opinions are subjective. Barton Goldenberg, president of Information Systems Marketing, a Bethesda, MD-based CRM consultancy, who has performed more than 300 CRM implementations with a success rating of over 90 percent asks, "Who's to say that the research firms' definition of failure applies to each company and each person within that company? I have one customer that is implementing a sales and marketing CRM project involving over 3,000 people. When asked if it was successful, the marketing people said for marketing purposes the global customer profiles was a raving success. The CIO, however, said it was a dismal failure because 84 databases were not properly integrated into one holistic data structure." That is why consultants agree that all parties involved in a CRM implementation from the chief executive down to the salesperson using it, as well as the CRM software vendor and the integrator, should all establish a set of metrics before they buy the CRM software to measure the success of the implementation. "People aren't realistic. The biggest reason for failure is the day they write the purchase order with several million ahead of them, too many things change within the timeframe to spend millions - new releases come out, companies merge, a sponsor leaves or looses interest, or other parts of the company wants a piece of the action," says Sue Handman, CRM solutions director at RCG Information Technology, a consulting firm based in Edison, NJ. "Where we all fail is in trying to measure something that is too big."
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