Don't Let Bad Data Ruin Your CRM
A database with no data has no value. The data we enter into it makes it valuable—even vital—to the whole business, as it transforms the database from an empty shell to an asset.
While this may seem obvious, it's important to make the point, because customer relationship management software operates on the same principle. When implemented, it is a shell with no form or function. Its real worth comes when it is populated with data: customer details, social media interactions, and vital demographic clues as to the business' customer base.
As data specialists, one of the big risk factors we see is neglected data. In the rush and excitement of implementing a CRM system, decision makers may forget something vital: The implementation is just the start of the journey, and the data needs just as much attention as the solution does itself.
Failure Rates for CRM Projects
Trying to find a precise rate of failure for CRM projects is difficult. It very much depends on the industry the clients are in, as well as the size of the implementation and the age of the data imported into the CRM system at the start.
But no matter the industry, the implementation size, or the age of the data, research shows that one thing is clear: There has been no discernible drop in CRM failure rates.
- Gartner reported an estimated 50 percent failure rate in 2006.
- Merkle Group reported a 63 percent failure rate in 2013.
- C5 Insight claimed a failure rate of 30 percent to 60 percent in a 2014 report.
As you skim these figures, remember that CRM adoption is growing, partly thanks to an explosion in the uptake of cloud computing. (According to Gartner, the industry was worth $16 billion in 2011, $18 billion in 2012, and $20.4 billion in 2013.)
So while there are seemingly small increases in failure rates in our random sample above, these tiny increments could, nonetheless, represent exponentially larger numbers of failed CRM implementations.
The Hidden Problem
Bill Band, a principal analyst at Forrester Research, asked 150 companies why their CRM was so problematic. Eighteen percent said they had trouble deploying and planning the solution; 22 percent found staff unwilling—or struggling—to adopt or use it; 27 percent said business processes were poorly integrated; and 33 percent felt they did not have the right technology.
While these reasons give us great insight into the way businesses adopt CRM solutions, they do not accurately pinpoint the hidden result of the chaos—dirty data. Here's why:
- If your CRM solution is not deployed in a way that meets requirements, you will not be able to capture the data that each department needs.
- If staff don't know how to use the solution, or reject it from day one, they'll probably develop their own data capture methods and workarounds, leaving the CRM system polluted and incomplete.
- If business processes are not properly integrated, the CRM solution cannot support staff in their work.
- If the CRM system is seen as deficient, defective, cumbersome, and slow, people won't see any reason to use it—and they certainly won't feel a responsibility to use it properly.
According to Forrester Research, the last point, a refusal to adopt, is a massive problem for businesses. The firm estimates that up to 70 percent of CRM implementations fail for this reason.
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