Where Does CRM Adoption Stand Today?

After nearly three decades in the CRM profession, I am still finding that the No. 1 thing that keeps my clients up at night remains the technology’s adoption—and the implication of what that means to the success of any CRM initiative. The challenges that we face today are much different from what we encountered in the early days. I thought it would be a useful exercise to go back to my roots, to when I earned my stripes in this industry, and talk about CRM adoption then and where many organizations stand with it today.

To assess the current state of CRM adoption, we also need to evaluate CRM’s evolution and how the adoption process has changed over the years. When we crossed the Y2K plateau, CRM was in its infancy with regards to how well it functioned, what these systems were capable of, and how they could serve as platforms. The downside of CRM was its ability to play well with other systems, but the core uses of CRM were focused heavily in sales and service.

The approach in the early days from a project perspective was usually very “waterfall”-intensive—a linear, cascading approach—and it seemed impossible to get any of these large projects off the ground. Adoption in those days was a simple metric of usage and data population. These were probably some of the worst determinants of CRM adoption. What we learned is that turning people into data-entry clerks was high on the adoption scale but low on the productivity scale and even lower on the employee morale scale.

Then the platforms started to evolve and innovate in ways that made CRM more accessible, more feature-rich, and more flexible for extending unique business use cases that were not addressed by other software platforms. We experienced what could be seen as the first big wave of adoption because teams could start using CRM in a way that was purpose-built for specific teams without impacting other CRM users. Adoption increased in those scenarios because people realized that you don’t need to use a high percentage of CRM’s functionality to make people more productive.

Running in parallel with the purpose-built CRM was the evolution of the cloud and an unprecedented marketplace of integrated applications that made data movement easy and enabled people to work without flipping between different applications to complete their day-to-day job requirements. CRM now supported making a person’s day easier, customers happier, and employees more productive. Adoption became more about how to engage more of the organization than a measurement of usage and compliance.

I would argue that this is where we turned the corner on whether CRM was mission-critical. For years, those of us who were CRM practitioners and evangelists had to sell senior leadership on the value proposition, and then all of a sudden we entered a landscape in which no one would dare scale a business without one. From an adoption perspective, we achieved success when B2B companies recognized that CRM was here to stay.

What Does Adoption Mean Now?

Although CRM became a permanent part of the business landscape, the level of “adoption” is all over the place today. What is not up for debate is that adoption can have so many different meanings that there’s no longer a clear-cut definition. I would argue that adoption should be aligned with business value and outcomes related to the strategic direction of the business over data points and usage.

The clear winner in the adoption game has been financial services. The structure of CRM is most closely aligned with the job description of those in this industry. Almost every firm I have worked with in this vertical has clear objectives, alignment with management and users, and a concentration on using CRM to improve the day-to-day work life of users.

Cloud technology providers are a close second, with technology services and product companies finding clear benefits from systems like CPQ (configure, price, quote), subscription management, and project management solutions tightly integrated into or as a part of the CRM platform. The users in these companies also tend to gravitate to and rely on technology, so the mindset tends to be friendlier to adoption.

The laggards in CRM adoption have clearly been service providers. More specifically, I’m referring to professional services—legal, accounting, and consulting organizations continue to struggle with the value proposition of CRM. There are many factors contributing to these challenges. The biggest among them is that in many of these organizations, the users are also the business owners, and as such might have built their business in a more idiosyncratic way than businesses have traditionally been built.

There are obviously many industries and scenarios we don’t have the room to cover here, and that’s without even getting into the B2C world, which in terms of CRM adoption is light years from where it was a decade ago. Those adoption stories are also all over the place, with retail probably leading the way. Whenever there are high sales and service needs that involve direct conversations with customers, multichannel CRM environments are always in play.

Adoption in all its forms will always be evolving. As I told a client recently, “Until you sell the business or close the doors, technology innovation, people and culture, and markets will always be changing.” CRM adoption can be compared to building a house on sand: It’s not impossible, but you sure need a high degree of focus. 

Danny Estrada is partner, chief growth officer, at Rare Karma. Throughout his career Estrada has been a CRM evangelist and expert at leveraging technology platforms to create business value. He has been a senior director at KPMG and a thought leader for Salesforce and Microsoft, and was published in an industry white paper by the Harvard Business Review. He also holds an executive MBA from the W.P. Carey School of Business at Arizona State University.

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