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Why CRM Fails

While CRM failures are not entirely prescriptive, a relatively small number of contributing factors are cited in the majority of CRM projects gone wrong.

  1. Failure to secure visible, vocal and active executive sponsorship
    Successful CRM projects have active and enthusiastic sponsors. Unsuccessful CRM projects do not. Executive management has to be visibly and vocally committed to CRM success—and the waning or absence of such commitment is clearly associated with CRM failures. Without executive sponsorship, all but the most limited CRM implementations are correlated to failure.

  2. Failing to involve users in the software selection process
    Many failures show a pattern of project managers, IT staff or software selection spearheads making a purchase decision in a vacuum—and without the input or functional requirements important to line staff. This generally results in acquiring CRM software that meets the executives' requirements for information reporting, but not the users' requirements for particular feature sets, ease of use, data entry methods, data management tools and automation capabilities.

  3. Failing to perform an objective software selection project
    This often results in choosing a product that is not best aligned to the business needs. In fact, this is often the result of getting enamored with gadgets, bells and whistles during the software selection process—which is a recipe for a challenged implementation and failed ROI. Some CRM vendors are excellent at the hype and only too proud to boast of their latest marketing award or advertising run. Some emphasize the hype of their newest software features in a guided effort to change your buying criteria to align with their latest product announcements. This dynamic adds even more confusion and complexity to the already arduous task of selecting the optimal CRM software which best aligns to your most strategic objectives and resolves your biggest pain points. Even worse, force fitting new, never before considered software features into an implementation effort may unnecessarily add cost and risk. Focus your software selection on the most salient and concrete criterion gathered during an internal information gathering phase and which most directly correlates your organizations most strategic business objectives.

  4. Approaching CRM as a technology project
    When CRM becomes an IT project, the project is destined to be challenged. One of the most common causes of CRM failure is to approach CRM strategy as a software or technology project. Too many failed implementations begin with the IT department installing the system, getting it running and then wondering why the strategic benefits fail to be realized. Even when the technology installation and integration is flawless, the implementation will fail if the software fails to deliver for its internal customers or the company culture fails to orient itself to the customer's viewpoint.

  5. Choosing CRM software without regard to prior technology investments.
    Choices in CRM technology can have far reaching implications, which if not considered in advance may not be recognized until an implementation is underway. There are a plethora of CRM technology options, such as proprietary or open source CRM, vertical market or horizontal CRM, and on-premise or cloud CRM. Other technology impact factors such as analytics, mobile CRM, consumer technologies and legacy systems can all impact a new software investment. These choices are best made when they consider prior IT investments and the context of the current IT infrastructure. When business users or rogue departments procure cloud CRM systems without IT involvement and IT environmental considerations, these new applications often incur difficulties during integration, customization or support.

  6. Unclear goals
    A failure to failure to define a clear set of measurable business or economic objectives. This also includes trying to go through an implementation without measures and milestones.

  7. Dirty data
    Data quality must be in place for information to be believed, trusted and acted upon. This is why data integrity and data quality measures are critical to CRM software implementations. Many challenged CRM implementations incurred an early project delay because of a failure to survey the data prior to the conversion. This was then followed by the untimely discovery of dirty, duplicate, incomplete and bogus data. This then results in added activities to the project plan for data cleansing routines and puts the project behind relatively early in the project.

  8. Over-customization of the CRM software
    This is often a reaction to choosing the wrong CRM software system. No packaged software will meet all of your functional requirements. More so, it's often the feature sets that support the companies competitive advantages that are more difficult for packaged software. Therefore, software customization is often warranted. But when customization goes beyond the core constructs of the application it inherits great risk of time and budget overrun. And even if and when it is finished it becomes difficult to manage, hard to upgrade and expensive to support.

  9. Failing to anticipate user adoption challenges
    Ah, the dreaded change management. User adoption fails when users apply a grudging acceptance of what management believes is inevitable change. Even though you might believe you are achieving your goal at first glance—simply because users are using the CRM system—if they aren't doing it enthusiastically, you will likely end up failing, albeit more slowly than if they had rejected it from the beginning. Employees who are just going through the motions without the motivation and intent to achieve cited business benefits are simply passing time and delaying the CRM benefits. Force normally doesn't work for the long term and trying to make it work is often like death by a thousand small cuts.

  10. Big bang implementations
    Deploying every CRM module at the same time often injects more business process and culture change than most organizations can accommodate. This big bang or watershed practice often leads to cross-functional chaos that can delay or destroy ROI.

 

 

CRM from Hell

 


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About CRM From Hell

This site examines the top causes and most cited factors that contribute to CRM software failures in order to share mitigating factors and clear strategies that avert failure and capitalize on the promise and potential of Customer Relationship Management.

 

 

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CRM failure rates have always been the Achilles heel of CRM. Too many companies throw a software package into an existing department and "hope for the best." The results are usually pretty dismal."

~ Sandra Eisenberg

 

 

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According to CRM specialist Frederick Newell, the top five reasons for CRM failure are: lack of organisational change (29%), company politics and inertia (22%), lack of CRM understanding (20%), poor planning (12%) and lack of CRM skills (6%).

 

 

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