CRM Best Practices Aren't Practiced

Despite a wealth of information on the topic and no shortage of professional services to ease the way, many businesses continue to struggle with adopting and using CRM capabilities. According to Forrester Research's "CRM Best Practices Adoption," a report by William Band, vice president and principal analyst for business process and applications, many of the 260 executives polled rated their companies' performance in 11 key areas to be poor or below average. The survey participants, members of Forrester's CRM research panel, scored themselves against Forrester's framework of 150 best practices and discovered the common thread in weak areas was failure to consider the reason for adoption. "Disappointment with CRM is usually the result of poorly conceived strategies that lack a laser focus on improving a specific set of business capabilities to increase revenues or reduce costs," Band writes. "But adopting CRM best practices is a difficult challenge for many organizations. Our findings spotlight many areas for improvement." The worst-performing area in the survey was marketing, where 37 percent of respondents rated their organization as poor or below average; the best (insofar as it received the fewest negative ratings) was direct sales, with 17 percent. The results, in terms of poor/below-average ratings, are as follows:

• Marketing...............................37 percent
• Customer analytics..................36 percent
• Customer service.....................35 percent
• Indirect sales...........................33 percent
• Customer data management....31 percent
• E-commerce............................30 percent
• Customer strategy...................25 percent
• Technology infrastructure.........23 percent
• Field service.............................22 percent
• People management................20 percent
• Direct sales..............................17 percent

It's important to note that the report also shows bright spots alongside the cautionary ratings. Marketing, for example, rated positive in 55 percent of responses -- 28 percent claimed to be average, and 27 percent above average/outstanding. Still, such a high degree of dissatisfaction indicates a large potential for problems in any organization. Poor strategy and execution in these areas can lead to lack of market insight, lost sales opportunities, customer dissatisfaction, and inability to expand, according to Band. That's just what shouldn't be happening, though. "Organizations continue to spend heavily on [CRM] -- $11 billion annually by 2010 -- to grow the top line, improve the customer experience, and boost the productivity of customer-facing workers," Band writes. To avoid wasting money that should be well spent on CRM, he recommends that executives "compare [their organizations] to CRM best practices, pinpoint the best opportunities for quick wins, and build an action plan to close the gaps." Related articles: Feature: CRM Gets Serious With customer loyalty an ever-more-fleeting commodity, businesses must deliver consistent -- and consistently high-quality -- service. In the five stages that define CRM maturity, is your company among the leaders? Not knowing means you're not there yet. Qualities of a Customer-Centric Business National Retail Federation Convention '08: According to the 97th annual NRF confab, what really matters in today's economy goes far beyond price. How Marketers Use Business Intelligence Intelligently When it comes to deploying BI in marketing, best practices can light the path to "information nirvana." Love, Marriage, and Business Relationships Keeping your customers from breaking up with you.