Monday, January 21, 2008

1) The true killer of what should be a great tool for companies and their customers.

About Me
I have been a sales rep for various companies for over twenty years. Since I got my first 486 laptop, and took my first (And only) computer course called "How To Turn It On" (I am not joking), I have been using CRM. I have (of my own accord and expense), purchased and used almost every contact management program, owned six Palm Pilots, two Pocket PC's and a Blackberry. All of this has been in search of the best way to manage my customer relationships.
In this I have been very successful, and have always maintained an exceptional sales record. I am very much a "Go to guy" for computer and software related issues, despite my lack of formal training in IT.

Three years ago, I was asked to lead the Canadian CRM implementation for my company, as well as continue my role as sales rep. After completion of the roll out, I was asked to lead the North American CRM project full time.

I have conducted two full research studies on CRM failures. The first study was in university, the second was on my own, in an attempt to understand why the same employees that told me CRM was going to be a "Great Tool" for them to use, weren't using it at all.

My research paper "The CRM Dilemma" has been validated by many people in sales and sales management from companies where CRM has been implemented, and has failed. My presentation of this research to my company that had not yet fully implemented CRM, ended my career with them. I continue to be passionate about providing a tool that employees will actually use, rather than neglecting and conducting mutiny against something that will help them because of one element of CRM.

The CRM Dilemma

Let me caution that if you have not yet implemented CRM at your company, you should probably not continue reading this blog. If like me, you implemented CRM to great fanfare, using all best practices available, only to find no one is using it, you may be very interested in this research.

My wife speaks of the day I discovered the CRM Dilemma and how shocked and depressed I was. I really believed that I had chosen the wrong career path in moving from sales to CRM. Although my findings have been validated time and time again, they are hard to accept.

After presenting my research, the IT Project Manager said "If I was considering CRM and heard your research findings, I would probably recommend we don't even try implementing, and save the money." Usually, the problem is easy, but the solution is hard. In this case, the problem is much harder to accept than the solution.

To follow I will list the six most commonly held best practices for lessening the odds of failure in your CRM implementation. These are directly from my group university research project "Avoiding the Pitfalls - A framework for Successful CRM Implementation" (We got an A+)

  1. Have a clear CRM vision and communicate it often from the executive level
  2. Focus on your customer strategy
  3. Focus on collaboration with all stakeholders
  4. Evaluate all business processes (Don't automate a bad process)
  5. Use proper training and follow up with users
  6. Ensure data quality

Your list may vary slightly, but it has been said that your odds of successful CRM increase substantially if you achieve all these steps. Because these steps are so difficult to achieve, it is easy to believe your CRM failure was because you didn't have enough_____(Fill in blank from above list)

On this blog, I will begin to lay out my research that proves traditional CRM will fail, even if all these steps are followed, because of The CRM Dilemma. With the exception of compliance-regulated industries (Financial, Legal, etc) which I will address separately, the definition of the CRM that will almost always fail can be taken from the "What Is CRM?" line from any CRM company. An example from Sales

"The simplest, broadest definition can be found in the name: CRM is a comprehensive way to manage the relationship with your customers — including potential customers — for long-lasting and mutual benefit. More specifically, modern CRM systems enable you to capture information surrounding customer interactions and integrate it with every customer-related function and data point. The resulting information mosaic is then used to create and automate a variety of processes that identify, and describe, valuable customers. Most important, these processes help you personalize new and ongoing interactions to cost-effectively acquire, stay close to, and retain these "good" customers."

This sounds like something every company needs and should be striving for. It would quite frankly be career suicide to stand up at a meeting, and say that what is described above would be bad for your company. Nor can an employee stand up and say they do not want CRM and they will do everything they can to sabotage it, and make it go away.

On this blog, I will conduct a staged argument of my research that involves a very diverse group of subjects, from Chess Masters to New York City Taxi Drivers. I have no doubt that many will disagree with my research findings. I welcome the opportunity for someone to prove my research wrong.

If I am wrong, I can become a successful CRM Implementation Consultant. If I am right, I will be able to help extract value for companies that have CRM systems in place that employees aren't using, by changing what CRM is used for. This change by the way, has nothing to do with words or promises to CRM users about what CRM information is to be used for.

CRM needs to removed from our vernacular. There needs to be a fundamental shift in our understanding of how users view these programs, and most importantly, what lengths they will go to as a group to get rid of the threat of CRM.


There are true CRM success stories (To a point). CRM can work when the intent is to record strictly what the customer is saying. Typically, call centers and web forms work in this fashion. As mentioned before, in highly regulated industries, a minimum standard of record keeping is required for oversight compliance. In some companies, commission sales reps are told "If it isn't in CRM, it didn't happen" meaning that commission payment is contingent upon a minimum standard of record keeping. None of these examples really fits the definition of "True CRM" but they are held up by the CRM industry because for the most part that is all they have.

On my next entry, I will address Game Theory in relation to CRM.

Best Regards

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