The Top 4 CRM Pitfalls and How to Avoid Them

CRM (Client Relationship Management) can be defined as, “The strategy upon which companies plan, manage and analyze interactions across their customer’s lifecycle to acquire, grow and retain customers.”

That’s at least what CRM is supposed to be. Instead, what we usually hear from clients about CRM are comments like: 

• “It’s a mess”
• “We use it badly”
• “We bought it for reporting but since nobody uses it. It adds no value”

For a tool that is so expensive, time-consuming, and promises to ease salespeople’s’ jobs, it’s surprising that many struggle to receive full return on their CRM investments. Why is it so difficult?

We outlined the top reasons why CRM implementations fail. Those reasons include:

• A lack of a strong vision and business case for change, resulting in little to no leader advocacy
• Excessive emphasis on technology, with little understanding of sales and service business processes
• Inadequate focus on sales skills and behaviors, meaning little capability to leverage the data and insights CRM delivers
• Treating CRM as a project, leading employees to believe the launch of the CRM is a “one-time event”, not a tool that should be constantly used to drive and sustain customer relationships

Over the last several years, we have helped organizations address the challenge of re-implementing CRMs (e.g., Salesforce) with the goal of unwinding a botched first implementation and the resulting poor user adoption.

There are four ways to approach this challenge well:

1. Develop the CRM Business Case and Change Vision

At the start of CRM-related projects, we work closely with the company’s leadership team to understand the vision for their sales and service organization. We help implement the use of their supporting CRM technology. This step is so important. It gives the company something to anchor to when inevitable skeptics challenge CRM during implementation and launch phases. Also, with involvement from the leadership team from the beginning, leaders are automatically clued in on key decisions.

2. Define Capability Building Blocks

Once a vision is set for the CRM, it is critical to define what we call the “building blocks” of the sales and service organization. By that, we mean the core foundational components of the CRM that will support usage of the tool. Often, companies define key building blocks like Accounts, Contacts, Opportunities, and Activities, and their respective supporting sub-categories. The key building blocks can and will vary by company depending on industry, geographic reach, and growth strategy. Aligning on the building blocks is critical. It allows everyone in the company to use CRM in the same way across various geographies, business segments, or roles.

3. Ground in Business Process

As mentioned above, one of the biggest reasons why CRM implementations fail is because of the lack of understanding of business process. Too often, the Technology or Marketing department will implement CRM with great intentions, but not great understanding. Building on the concept of defining building blocks in #2, to implement CRM well, there must be a strong understanding. The understanding must include how the sales and service organization manages objects like Accounts, Contacts, Opportunities, and Activities in the “real world”. At this stage, we typically help organizations align on a global sales process. One that incorporates how a sales or client service professional works with Accounts and Contacts in their territory, manages an Opportunity through pipeline, or generates the right Activities to achieve revenue goals. Thorough understanding of business process underpins any successful sales transformation roll-out.

4. Manage the Change

One of the most difficult ways we work with clients is by helping work through change management. Change management across any aspect of sales is challenging but is especially challenging when it comes to CRM. This is because of the various departments that the change cuts across: Sales & Service, Technology, Marketing, HR/Leaders, Frontline Users, etc. Actively managing the change should be a number one priority from the very start of a CRM re-implementation. Key tip: there must be executive sponsorship, a central governing body, and user champions. Without these elements, it is difficult to get frontline managers and users to prioritize time to learn and utilize CRM.

There are several reasons why companies re-assess the value of their CRM tool. Some common reasons include:

• A shift in strategy to grow specific customer segments
• Geographic expansion
• Implementing integration with another workforce
• An increase in WFH (work-from-home) policies
• High employee turnover
• The need for better prospect and client documentation
• Pressure from investors for better predictability of sales outcomes

Contact us to discuss CRM pitfalls, including ways to avoid them in a fast changing sales environment.