Systems Implementation: How CRM Is Different

I have read many articles over the past 12 months that focused on the critical success factors for a CRM software implementation. In every case I have finished an article thinking, "While I agree with nearly everything suggested in the article, the article is completely wrong." How can this be? The authors usually include lists of critical success factors, such as obtain executive level buy-in and active support for the project, use metrics to establish baseline performance and desired postproject activity levels, incorporate users into the project team, regularly communicate status and issues up and down the project-team chain of command, and do upfront project planning and update plans as you go. Although these are critical for project success, they are not unique to CRM projects. Executive support and the other generic factors are also important in ERP, supply chain management, data warehousing, and other types of projects. But I believe there are unique factors. The considerations specific to CRM projects fall into two groups: those things you must do, and those things you must avoid. Both groups are important. Things You Must Do
1) Any company implementing a CRM system needs to first have a CRM strategy. Becoming more customer-centric will probably require changes in processes and organization structure. With CRM you have to know what the company is trying to do. That will determine which features and functions to configure, and which might be disabled. If, for example, improved customer service is the focus of the CRM strategy, then you would not be worried about the ability to upsell and cross-sell out of the contact center; you would focus on responding to customer questions and complaints. The complexity, functionality, training, integration, and other aspects of the implementation are driven by the strategy. 2) Develop an ROI calculation for each CRM module and use that information to help prioritize implementation order. Each CRM application module has the ability to lower costs, increase revenue, or both. The payback is usually relatively quick. ERP modules, say a general ledger or HR, often do not by themselves have the same financial impact as CRM modules. 3) Speak with your customers when developing your CRM requirements. Customer focus groups and individual conversations are critical for understanding how to organize processes and systems. Other types of systems implementations are internally focused more than 90 percent of the time. Some people argue that there are internal customers for a CRM system, but they should by definition be a minority of customers; indeed, the opposite argument is that all real customers are external to your company. 4) Historically companies have organized themselves around the product or service they sell. But CRM is customer-centric and you need to have the ability to relate everything to a customer. Any employee working with a customer needs to have a complete view of that customer's relationship to the company. Business processes and systems integration should enable this capability. Implications of this concept include broad customer access for all employees, multifunctional employee roles and data relationships in which "everything is related to everything." Being able to see sales, marketing, field service, and customer service transactions related to a customer is vital to servicing that customer. 5) Those of us who have been doing systems implementations for a long time habitually look for ways in which a system can reduce costs. We analyze whether transactions can be handled in less time or more transactions handled in the same amount of time. But CRM modules offer the potential to generate additional revenue by more tightly targeting marketing, providing quicker and more complete data for the salesperson, and providing more convenient sales channels. With CRM you need to think more about revenue generation; this is where the huge upside resides. 6) Because so much of CRM is external facing and accessible, you must be clear on data definitions. Some of my most satisfying moments in consulting have come when untying data knots. One company's management team, for example, disagreed constantly about operational numbers because finance, marketing, sales, and operations unknowingly had separate definitions of customer. Once we understood the problem and explained the different interpretations, past disagreements melted away and corrective actions were quickly implemented. Customers ordering online, or performing other self-help tasks, must also be clear on the meaning of the data they see. And the data must also be accurate--confusing or inaccurate data will not improve customer satisfaction. 7) The employee using a CRM computer application cannot rely on a predetermined transaction sequence to solve customer queries, problems, or complaints. Transaction processing needs to include some analytical thinking on the employee's part. All of us have probably contacted a software support center with a problem. How often is that problem resolved in the first contact? Even with a knowledge base, keyword search, and other analytic tools, first-contact resolution is still highly dependent on the experience and thinking of the customer service representative (CSR). Responding to two identical complaints can also elicit variable CSR responses, depending on the customer's value, influence, and other factors. CRM contact center system users need to be selected for their analytic capacity and trained to further improve that ability. 8) A related point is the importance of artificial intelligence, knowledge bases, business intelligence, and self-learning within CRM. With ERP applications you traditionally perform many transactions and then use information stored in the data warehouse to create analytic reports. With CRM you may be using information from the knowledge base or data warehouse to execute individual transactions. For example, pricing may be variable depending on data warehouse information on competitors' pricing in a given geography or current versus expected sales rates. Companies need to take advantage of these complex capabilities, whether supplied or configurable, within the application software. Things You Must Avoid 1) Unless salespeople have been crawling into management's offices begging for a new system, do not start with sales, even if it is a key component of the CRM strategy. The oft-cited high failure rate for CRM implementations is related to companies starting with the sales module. Many salespeople fail to see any personal benefit in using a system that "forces me to enter data so management can micromanage me." Unlike other functions, salespeople have leverage within a company that management often has trouble dealing with. Trying to force people to give up their personal-contact management system often leads to project failure and strained employee relations. 2) Do not immediately throw all the system functionality at the users, who may then feel overwhelmed. User acceptance can be obtained or enhanced by disabling marginal features and functionality. 3) Do not expect customer self-help to be a panacea. Some clients think that by populating a knowledge base customers would be able to solve more than 80 percent of their questions and problems. Something approaching that number is possible, especially if your customer base is small and highly knowledgeable with your products. But companies with large numbers of customers are unlikely to see such a large reduction in contact center activity. 4) Do not expect your contact center to drive your CRM revenue generation strategy successfully--unless you fundamentally change the way management typically looks at contact centers. Too many companies enamored with the idea of turning the contact center into a profit center fail to look at the people skills required. Do you really want project success to hinge on a group of less-experienced, $8/hour, possibly contracted-out employees with high turnover? Just as the best mechanic is not always the best foreman, existing CSRs may not be the selling machines you are hoping for. About the Author Greg Anicich is an independent consultant focusing on business performance improvement through ERP and CRM implementations. In a 25-year professional career Mr. Anicich has spent 14 years with one of the Big 5, three years as VP of ERP & CRM with a closely held consultancy, and the past several years on his own. He lives in Northern California and can be reached at
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