Depending on which statistics you choose to believe, up to 70% of CRM implementations fail. I wrote a post titled 'Simplify sales before we reimagine it' and in it I discusses the need to simplify all we do including CRM. The days of monolithic legacy architectures for most software systems are coming to an end.
Yes, we need a single source of the truth about customers and a large enterprise has no chance of being trusted and customer centric without a well conceived CRM strategy underpinned with the right technology. But the term 'Customer Relationship Management' has been hijacked by software companies.
Without doubt we are entering the era of mash-ups as savvy leaders obsessively focus on creating compelling customer experience, both on-line, mobile and in the physical world with real human selling and service. I asked some people I respect about what's wrong with CRM today and where the future is going. I received some interesting opinions. Buckle-up and then let me know what you think.
Grace Schroeder is CEO of idea2 and she's an expert in working with Application Program Interfaces (APIs) to bring systems together for awesome user experience. Here are her thoughts on what's broken with the way people decide and buy, as well with the current approach of CRM solutions.
Technology decision-making is broken. All over the world, IT executives are making poor decisions wrapped in comfortable RFP processes, consensus, and default thinking. Unknown to themselves and their CEO's, they are signing away their companies' souls by locking them into legacy technologies that will not support the changing business dynamics already underway and locking them OUT of technology innovations that could accelerate and transform them.
Kill the Traditional Software Deployment Model. Technology innovation is creating a wake of capital destruction with the power to capsize entire markets. Established software companies, sense that something strange is happening, and too many of them are reacting instead of acting. They are playing it safe. They are forgetting how to take the risks that brought them their power in the first place, and their best hope is that they regain some courage before their revenues run straight over a cliff.
Naturally aggregating the cloud. Cloud services are like potato chips. No one eats just one. Since it became possible to log into a software solution, decision making has gradually transitioned from IT to (mostly departmental) users. A group of people decide amongst themselves that certain online subscription services make work lives easier and deliver better results to the company. This is great. However, in order to see the results of these efforts, people need a login. No login - no access to the brilliance that is enjoyed by the users. Someone is making reports, someone is asking for reports, things stop being real time. If people could only KNOW the glory of what is happening in these silos, sales would happen faster, better customer profiles would exist, decisions would be made around real time facts and customer interactions.
A sane approach to software decision making. There's a better way, an adaptive team-based model that brings stakeholders together as partners. Together, we will study the problems you need to solve and work with you to form a technology vision to support the knowns, unknowns, and even the unknown unknowns of your business. The sane approach solves problems quickly, iteratively, with minimal disruption. It doesn't just "control risks" - it turns problems into possibilities, in real time. ??Your product will be better. Your costs will be lower. Your grandchildren will admire you.?
The sane approach involves deep, clear discussions about trade-offs to make sure that short term and long term objectives are prioritized against business impact. You'll understand when and why requirements change. You'll disentangle yourself. Decisions should be ongoing and ever-evolving discussions - not a list of assumptions made by someone who doesn't know your users, long-term business goals, competitors, or technical competency.
Consider these executive personas and how they drive the dysfunction.
Chief Suspicion Officer. Despite respectable financial results, they feel the gap between their leadership using the right words and the existence of a rational technology strategy. They see the same processes, the same vendors, and the same contracts sprinkled with cloud words. They don't have the words to challenge it. They keep hearing that their company needs an integration strategy, but they don't know what that means.
Canary in the Coal Mine. You're working in a company of great people. The business is growing. You have not been getting support from internal IT, because your projects aren't deemed core to the business, and IT is too busy for you. Luckily, being a cloud guru, you have organized your department with some great technologies that your people have found. You are making it all work together. Problem is, you can't get the data to others in the organization without adding a new role: Captain of the Swivel Chair Department. Now, you're right popular - everyone wants to know what you know. So the company decides that it needs a comprehensive cloud strategy. They gave a guy in another department the title, and he's going to figure it out for the entire company. ?He's been going to conferences for a year, and submitting white papers till hell won't have it any more. Meanwhile, you're getting more and more steeped in the tools that you are using, and you're afraid that you will be forced to rip them out and start over.
The Ostrich. 'It will all go away - security is a problem and we have spreadsheets'. They ask lots of red herring questions to fend-off discussions about cloud:
- 'My mentor told me to always buy out of the box and that's the rule I follow'.
- 'My guys tell me we have all that covered'.
- 'Do you know where we can get a Microsoft Access developer do you?'
- 'Have you heard of FoxPro?'
- 'Do you have something I can read?'
The Hero: He wants to save the day but he doesn't know how. Who will listen anyway? Who should be the cloud decider? This is a major dilemma in many companies. There are people with titles to suggest that they are the deciders. However, the very nature of the word decision is challenged when it comes to working with differing technology solutions. Almost every business process in the company (including the RFP process) leads to poor decision-making.
The truth of the matter is the perfect human(s) to make these decisions do not exist in every company. The proliferation of solutions has done a great thing - there are point solutions for many more business functions, and they're easier to use than ever. The nature of the solutions add transparency, visibility and accountability into results, and should guide people toward more effective work products.
That said, how do you take an organization that isn't technologically savvy, and begin to introduce solutions in a way that can be easily consumed? If not easily, at least in a way that does not cause people to stick a fork in their leg when they log into their new platform.
Customers have needed trusted advisors more; to help them navigate the conflicting messages and complexity of technology. But customers must themselves also appoint leaders who can bring it all together internally when designing the customer experience they're seeking to create. These people must care the most about success and possess technical curiosity and skills and to enable them to understand the world of the possible. Finally, they must help the best people in their teams be part of the decision process and implementation.
Certainly Grace sees CRM is part of the answer but not the panacea. She is very much all about integration and knows that the best customer experience is created by bringing data and systems together. This approach uses the right tool for the right job and is agile in its approach. Technology today offers low cost web services and modern Application Program Interfaces (APIs) to bring mash-ups to life in an affordable way.
Michael Bonner from Pipeline Manager is someone I respect enormously. He is one of the smartest people I've met and has many years of CRM experience in making systems both usable and valuable in enabling process efficiently and effectively.
First I asked Michael: "What's wrong with CRM?" CRM was designed by IT people. Sales never took a leadership role in designing CRM. Then Marketing and Inside Selling got thrown into the mix - again by a department that was never trained in those professions and with no accountability for outcomes. We see years of research pointing to customers engaging with sales later and later in the cycle. And yet we see no improvements from CRM offering ways to understand that big-picture cycle, let alone view it or proactively control it or the customer's journey. Instead, department silos are reinforced.
Next I asked: "Where do you see the future for CRM?" "First we have to ask: Why would this situation change any time soon? Improved sales has no effect on IT compensation or reviews. Whether a rep takes a minute or quarter of an hour filling out a CRM form, IT has no real reason to care. This problem plays out in countless minor inconveniences, overloaded forms and counterintuitive workflows. The problem compounds itself across inefficiencies throughout the lead-to-repeat-business sales cycle."
The easy way to fix this: put IT/CRM admins as well as everyone involved in generating business on a strict, generous commission. That will keep all the silos laser-focused on coordinated activities that speed up a sale. The entire organization will get very smart about how a rep uses his/her 2000 hours per year. Long IT projects will become a lot shorter. Admins will be anxious to know every best practice out there and will then align CRM to support those practices. Marketing will add to the CRM only those things that are truly critical to driving revenue.
CRM of the future could look like a single source of information that tracks the entire lifecycle of the customer, with emphasis on the processes that make a sale, rather than petabytes of low-value forensic data. The hard truth is that technology can support almost anything that sales can imagine.
Looking at the future of CRM I see a big disconnect between all that CRM could be and the more likely outcome of people protecting turf, undermining change and training, passive resistance to anything that says that people could be doing better.
Despite the phenomenal payoff that any organization would have with a CRM that actually helped them make more money, there may be too many entrenched shibboleths to allow that change to happen. The bigger the organization the more entrenched the old silos and blame games seem to be.
So - CRM as an industry can keep growing at double-digit rates without having to fix any of its systemic nightmares. IT can stay in control of tools that they never have to use while ensuring that user confusion translates to greater job security. Until top management starts feeling some pain, there's no reason to expect a shift that results in a change in the culture, the silos or the software that supports them.
Michael Bonner has delivered many CRM implementations in the real world to transform sales execution but now it's your turn: What's the future of CRM in your eyes. Are mash-ups the future for user experience with CRM the underlying database?
Tony Hughes is ranked as the #1 influencer on professional selling in Asia-Pacific and is a keynote speaker and best selling author. This article was originally published in LinkedIn where you can also follow Tony's award winning blog. Also visit Tony's keynote speaker website at www.TonyHughes.com.au or his sales methodology website at http://www.rsvpselling.com/.
Main Image Photo by Flickr: Steve Jurvetson Jeff Koons' "Michael Jackson and Bubbles" 1988 chilling in front of Hua Yan's summer gatherings in mountain villas 1738.
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