David Harkins

David Harkins

Dr. David L. Harkins is a social scientist researching the human experience in systems and culture. He is an experienced executive coach and consultant, passionate educator, and keynote speaker. Through his teachings, inspiration, and guidance, he helps individuals and organizations identify and connect with their potential to make a meaningful difference in their communities.

Preparing for trouble with CRM

Customer Relationship Marketing (CRM) is one of the most prevalent and vital initiatives corporations undertake, both large and small. Industry experts claim that nearly five out of every ten CRM initiatives fail. What’s the difference between those that succeed and those that fail? What does it take to implement CRM successfully?

My observations from successful CRM initiatives suggest that success can be partly attributed to the ability to strategically manage the various aspects of CRM within the context of your organization’s broader business direction. Based on our experiences, we suggest organizations consider the following points when developing and deploying a CRM initiative:

  • Create a strategic CRM vision. Buying the latest and greatest CRM software application or developing the slickest e-commerce site will not solve your CRM challenges. While technology certainly plays a significant role in supporting the success of CRM, CRM is a strategic initiative. It’s a way of doing business, not just a way of managing information. As such, a CRM initiative will be most successful if an organization has a clear vision for how it wants to deliver value to its customers.

A robust CRM vision is critical because it helps ensure that the decisions made in selecting technology will be based on the company’s goals and not be driven or limited by the functionality or capability a particular software application may provide. Remember that technology should support the vision of CRM, not drive it.

  • Avoid the cookie-cutter technology approach to CRM. Every business has a unique way of dealing with its customers, and while many technological CRM solutions are designed for your particular industry, virtually all will need customization to address your specific organizational needs to build loyalty with your customers. The goal of CRM is to differentiate your business from your competitors. If everyone uses the same technology or software application without customization, there’s no significant competitive differentiation, and you’ve gained little from your investment. Make sure the application purchased meets the needs of the organization.
  • Manage the number of cooks in the kitchen. The complexities of CRM may require working with multiple vendors on various aspects of the initiative. The vendors’ efforts are often uncoordinated and result in “finger-pointing,” which inevitably occurs when something goes wrong. For example, depending on the organization’s needs, there may be a systems integrator, a contact management or sales force automation software vendor, a campaign management software vendor, and maybe an analytical software vendor. Each vendor will have specific needs, such as particular data structures, data and system processes, and data needs for implementation, but how can an organization ensure that these needs are aligned to effectively and efficiently enable the CRM initiative?

Best practices suggest that the way to ensure success with multiple vendors is to:

  • Identify and hire a prime contractor as the lead project manager. One of the vendors should be charged with the primary responsibility for ensuring that all of the applications work together correctly. In some cases, the prime contractor could be a consultant; in others, it could be a systems integrator. However, it’s often best to hire an independent, neutral party to serve as the prime contractor or project manager to manage and coordinate the overall project.
  • Develop an integrated project plan. A project plan, which incorporates all vendors’ critical tasks and milestones, is necessary. Significant dependencies between vendors may often go unchecked if not combined with the overall plan.
  • Engage all vendors in the system design and implementation process. Proper engagement should help prevent one or more vendors from moving in a direction that may be optimal for their product or service but may render another vendor’s product or service inoperable as planned.
  • Engage all vendors in ongoing communication. All vendors involved in the project should receive weekly project status reports and participate in weekly team meets. Overcommunicating will help avoid miscommunication as the project progresses.
  • Bind the vendors contractually. An excellent way to minimize these disputes is to bind the vendors contractually and enforce mutual warranties of performance for each vendor involved. In other words, each vendor would warrant that its work or applications will operate free of defects with the products and services of the other vendors on the project.

There are many challenges and issues to address when managing a CRM initiative. Addressing the factors here alone may not ensure success. However, if you keep these at the forefront of your initiative, you will have the ammunition you need to overcome many significant contributors to CRM failure.

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