The CRM Dilemma - Basic Research Paper

In order to assist the many readers of this blog, this post contains the basic elements of the CRM Dilemma and the PACT solution in one document. Additional information is found in my other posts. Each frame is this post can be opened by clicking on it.

"The train wreck you can't look away from."

There has been a great deal of discussion about the contents of this blog. One individual complimented my site and my research, but likened it to "A train wreck that you can't look away from." He is experiencing the same response that I did when I discovered "The CRM Dilemma."

Once I discovered the existence of the CRM Dilemma, I knew the CRM implementation I was leading, would fail. Not because we were focusing on activity controls, but because we weren't focusing on removing all activity controls. At that moment, I knew I was looking at an impending train wreck, unless I could explain the CRM Dilemma so convincingly, that we would change the focus of our implementation. It didn't work! Thus the warning I provide about the danger of presenting "The CRM Dilemma" too early.

I have told friends that the moment I finished the presentation of my research, I knew I was finished.

If you believe this research, it becomes very difficult to look at an impending CRM implementation the same way. If "The CRM Dilemma" really is the answer to the CRM failure question, it means that I am a genius, that has discovered that which we really didn't want to know in the first place.

My discovery means that the CRM failure rate for sales reps could be far higher than has ever been reported.

I really look forward to implementing a PACT solution to prove or disprove the value I believe it can bring to a company. I know that removing activity controls from the equation, resolves the CRM Dilemma.

I continue to be amazed how many people are visiting this blog and I thank you for your emails. Please continue to share this blog with your collegues.

Best Regards
Arne Huse

24) 100% CRM Compliance

I discovered a web site www.cohon.com where Charles Cohon claims to have 100% compliance in CRM usage by his sales reps. He says he accomplished this through a number of methods including all CRM input being done over the telephone, which is transcript by someone and entered into CRM. He also said he promised his reps, that NOTHING they enter, would ever be used against them.

I find this an interesting story as it really goes to what I have been saying about The CRM Dilemma. If Mr. Cohon has indeed achieved 100% compliance, I think it is much more about the promise of impunity, than the methodology. What I am advocating is to remove "Low Card" activities, which is what he must have done as well. There is little sense in gathering data you never intend to use. If you ask a rep to record how many calls they are making, why bother if you can never tell that person they aren't making enough calls?

The promise without action is useless to overcome "The CRM Dilemma," as I discovered in my own CRM implementation. I was employed by a company that did not in any way have a culture of accountability. The implementation of CRM was in no way designed to bring more accountability to our sales force. And yet, the moment sales reps saw "Activity type" drop downs and various "Tick boxes," they surmised (With good reason) that higher accountability was on the way with CRM.

Fortunately for them, they were very quickly able to abandon CRM and go on with their own private systems once again.

I can only assume that Mr. Cohon has a very small sales force with no other managers to louse up his promise of impunity. This is not the case at most companies and all it takes is one manager holding performance data, (that a sales rep has provided) up to the face of that sales rep. The news spreads like wildfire and the gaming would begin in earnest. Of course "The CRM Dilemma" rarely lets it get this far because there is no "Trust before distrust" when it comes to activity controls.

23) The user view versus the company view

I came across a very interesting website for a GPS tracking system for vehicles called GPSMate.

This company has two products for sale. The first product is for individuals, the second is for companies. I am going to paste the details of each and then discuss the specific language used to target each audience. Both products are designed for the reporting of driving activities. I will change the font on the points for discussion to Bold Red.



What is GpsGate.com BuddyTracker?


GpsGate.com BuddyTracker is an online service for GPS tracking and position sharing. GpsGate.com offers buddy tracking and vehicle tracking services and many integrations to third party applications.
BuddyTracker
With GpsGate.com BuddyTracker you can follow people and objects that have a GPS with an Internet connection. You can also share your own position by connecting your GPS to GpsGate.com.



Note: You are always in control as you decide if you want to be seen, and who you are visible to!



Product number 2 for companies



GpsGate.com VehicleTracker
GpsGate VehicleTracker is a web based vehicle tracking application. It is available both as a hosted solution at GpsGate.com and as a server product. If you are looking for your own vehicle tracker installation have a look at our GpsGate Server here.


With GpsGate.com VehicleTracker operators can follow their vehicles in real-time and display historical track information for selected vehicles. Track data can be exported in KML and CSV (Excel) formats for further processing.Access rights are defined for each operator for a set of vehicles and each operator has a personal account for security and flexibility reasons.You can also get read access to your database, the possibility to translate and re-brand your user interface as an option.



Fascinating language

I think this web site has done an excellent job of defining the view of CRM, from the perspective of the user and the company.



User Language: The term "Buddy" is a friendly term containing no element of threat. You can "Share your position" infers you have complete choice over this decision to again lower the threat level of this product. In case you don't quite believe this, there is a final, separate point, highlighted by an exclamation, that provides comfort in knowing that you can always turn the system off, and decide who sees where you are.



Company Language: We aren't tracking our "Buddies" (People) anymore, now we are tracking "Our vehicles".

For "Security and flexibility reasons", our company can deny access to the the system by operators of our vehicles. The "Comfort language" here, is that we can keep people from turning off the ability to track our vehicles, or see the information we are recording.



Now, I know that GPS transmitters are used in trucks all over the world and these systems offer huge benefits. If I was a driver, on a highway, with a load of plasma TVs, it would also be comforting to know that my company knew where I was. I am also sure that in today's tight labor market, companies spend little time harassing drivers over frequent bathroom breaks. In companies that have chosen to monitor human behavior with GPS tracking, I wonder if drivers have employed "Gaming" techniques, but I have no concept of what they might be.



Users want to be able to avoid tracking, and companies are seen as wanting to enforce tracking, because users want to be able to avoid tracking.

22) Oh, what a tattered web we weave...

As I have written before, my discovery of "The CRM Dilemma" did not come from CRM. I was simply seeking answers on why my fellow sales people had lied to me, when they said they would use CRM. Because I am an INTJ, I knew the answer must be outside the boundaries of what I was being told.

As I said in my research, I began to discover the secret hidden within the aversion to activity controls (Knowing the steps someone takes to achieve a known outcome). I looked at sports stars, chess players, taxi drivers, doctors, and many other groups, to determine the lengths that people will go, in order to have their activities not be controlled.

Because I also ultimately want CRM to work because I believe in it, I looked at possible ways to force CRM users, to get past "The CRM Dilemma" and use it, despite their fears. Once again, to find the answer we look outside the realm of CRM itself.


As I considered my last post, I began to think about the amount of time and energy it would have taken, for my contractor friend to hide his activities and mistakes from our reporting capabilities. I would also like to consider methods that could be used to ensure accurate reporting by our contractor. Remember, although we know the true reason for the resistance to this reporting, it will never be stated by him. I would also like you to consider the amount of time, energy, and money, spent on each step.

Remember: The goal of the system deployed to this contractor is to increase efficiency and profits for both him and us. No where is it stated in our goal, that we wish to bring punitive actions against him, for inefficiency, or using too much lumber.

What the contractor would do:
First line of defense - Excuses

• "It takes too long to record each cut"
• "The laptop is impossible to keep clean in a construction environment"
• "The software is too complicated"
• "The software is too slow"

Our response:
Address the concerns and provide solutions

• Move to a weatherproof, handheld device
• "Always on" software
• Provide additional training and job site support

Contractor step 2: Promise to try the new tools and provide feedback.

Contractor step 3: Let the gaming begin!
The contractor has convinced himself, that despite our assurances of the system being to his benefit, what we are really looking for are ways to measure HIM. He has arranged with another contractor friend on the same system, that they will share lumber when required, in order to improve "Their numbers." They have also figured out that if they buy a few boards with their own money, they can improve their odds of winning the yearly prize for the "Most efficient contractor." The award will more than compensate them for any lumber purchased. They have also agreed to split the prize money.
They are now maintaining a spread sheet to keep track of the lumber, but it is becoming more difficult to keep it all straight.

The reports aren't making any sense
We are finding discrepancies in the amount of cuts reported, versus the amount of lumber being used. Because we require accurate information in order to achieve or efficiency goals, we look for additional tools to ensure more accurate reporting of lumber and cuts.

New tools are required
We discover that a company has produced a new saw that will automatically records cuts made, and upload the information each day to our database . By adding RFID chips to all the lumber, we can get an accurate picture and decrease the effort by our contractors in providing the information. The new saws are purchased, our suppliers have agreed to add RFID chips to lumber, and our contractors are trained on the new system. The contractors say they like the fact that less effort is required to record the information.

The contractors have to step up their gaming efforts
The contractors continue their lumber swapping and side purchasing of lumber. Several of the contractors have been reporting problems with the new saws and have said they have to keep their old saws around, because they are reliable and trusted. One saw per job simply isn't enough anyways. With the new saws reporting cuts and the old ones not, reporting is now becoming even more eratic. The contractors have demanded they receive additional and better quality saws that they can rely on.

It isn't difficult to determine what is going to be the end result in this hypothetical situation. The bottom line it seems, is there is not a snowball's chance in hell that the contractors are going to provide the information we are looking for. Each move by us will receive an effective counter-move by the contractors.

• We will receive no pay back or benefit
• The contractors will receive no benefit from the tools
• From day one, the contractors had decided the new system was never designed to benefit them and it had to be defeated
• Distrust on both sides will increase
• An incredible amount of energy will be spent instead of focusing on building houses and making money
• A huge amount of money will be spent by us, to address objections that were not really at the heart of the problem

In my last post, my contractor friend had said that if we could provide him with an effective Planning and Communication Tool, (PACT) it would be of true benefit to him. Since our original goal of efficiency and profits could be achieved, without monitoring lumber cuts, why would we not take activity controls out altogether?

21) Explaining my research to someone that has never heard of CRM

Last night, a friend of mine asked me to explain my research into "The CRM Dilemma." My friend builds houses for a living, rarely uses a computer, and has never heard of CRM. I used the following analogy:

We want to know how many cuts you are making each day, to ensure you are building houses efficiently. By understanding how many cuts you are making, we will be able to help you streamline some of the processes and help you make more profit by reducing waste.
Please begin to record each cut, the size of wood, and where the board is going.

"What if I make a mistake in cutting a board?" he asked.

I told him he should record that too, so we can help him minimize those mistakes in the future.

Then I asked my friend what he thought would happen.
Interestingly, he didn't talk about the time it would take to record each cut and how that would interfere with the amount of time he spent, actually building.

He was more concerned that he would feel very uncomfortable with having efficiency reports run on his activities. Although my friend is one of the most honest people I know, he said he would probably not record most errors he made. He said he would use the boards cut in error in other places (As he does now) but find ways to report it in such a way, that we wouldn't know it was actually a bad cut. I explained that this would mean the reports would not be valid and we would not be able to help him improve if he didn't tell the truth. He said he simply wasn't going to tell us every mistake he made, or every detail, so that we could figure out how many mistakes he made.
I had turned my highly skilled, honest friend into a gamer and a liar.

My friend now understands "The CRM Dilemma" perfectly!

PACT explained to my friend using the same analogy:
Instead of recording each cut, we want to help you plan your cuts, before you build a house. You can select from various reports that will provide each suggested cut, and also suggest where the end piece can be used. If a mistake cut is made, the software will allow you to search for the best place to put the board, without registering it as a bad cut. At the end of the project, you can evaluate how using this model improved your profit.

The software will also allow you to quickly pass "Next steps" onto your sub contractors so everyone will know what they need to do to complete the job.

My friend thought this was much better than monitoring his cuts and he said the second system is one he would actually use.

19) What is said - How They read it

To follow, I will copy key benefits of CRM noted on two software-provider web sites. Following each key benefit, I will list what needs to happen to accomplish each benefit, and what your sales force is reading into these statements. If your CRM system sits unused, look to what is NOT being said as the true culprit.
I am in no way saying your company does not have the right to ask or require this information from your sales reps. I am trying to show how "The CRM Dilemma" causes reps to do everything in their power to defeat or circumvent CRM. To date, sales reps have been exceptional at avoiding "carrying the stick with which they are to be beaten."

MS CRM (What they say)

"Improve field-service performance"
"Microsoft tools for field service management allow you to track the activity and results of individual field representatives or teams, identify any issues, and increase performance. When managed with the help of Microsoft solutions, the delivery of field service, maintenance, or sales might yield even better results, and drive more income, than it does today."

What has to happen: Activities and results cannot be "Tracked" unless they are first recorded by field personnel. "Issues" cannot be identified unless the information is accurately provided.

What your sales people read but do not say:
Microsoft tools for field service management allow you to track my activities and my results. Identify any areas where I am not doing my job, and increase my performance through closer scrutiny . When I am managed with the help of Microsoft solutions, my delivery of field service, maintenance, or sales might yield even better results, and drive more income, than it does today. "If I don't provide the information about my activities, my activities can't be tracked."

"Are you neglecting any customers? Run a report to find out"
"To build lasting relationships, you must check in with leads, opportunities, and customers regularly. You can use the Neglected Accounts, Neglected Leads, and Neglected Cases default reports in Microsoft Dynamics CRM 3.0 to identify contacts, or you can create your own report using Microsoft Office Excel 2003."

What your sales people read, but do not say: If I am neglecting any customers, you can run a report in CRM to find out. "If I don't provide the information, these reports cannot be run against me."

SalesForce.com (What they say)

Territory management. With the territory management capabilities in Salesforce, you can easily define,
administer, analyze, and change sales territories to match your sales organization, no matter how complex it is or
how frequently it evolves.

What your sales people read, but do not say: If you want to strike fear in the hearts of your sales force, just mention the words "Territory realignment." "The CRM Dilemma" is epitomized in the words "administer, analyze, track, change, and define."


Opportunity management. Opportunity management enables sales teams to work together to close deals faster
by providing a single place for updating deal information, tracking opportunity milestones, and recording all
opportunity-related interactions. Salesforce can be customized to fit your internal sales methodologies and
processes, making it easier for your managers to monitor their sales pipelines.

All these items are required to be recorded by the sales reps themselves. They do not just "Appear" in reports unless sales reps feel secure in entering the information. Since most of these points would be considered "Low Cards" by sales reps, the fear of providing this information overrides any perceived benefit in doing so.

18) Contact Management to CRM - Harder than you think!

I purchased my first computer back in 1994. It was a lightening fast, Toshiba 486 laptop. I believe I paid more for that Toshiba, than the Dell XPS 1330 I am typing this post on today.

I bought my laptop back in 1994 for one reason; to manage my customer relationships. I remember the day I spent loading Maximizer, using the nine floppy disks that I paid a small fortune for. I spent quite a bit of time entering all my customers into my Maximizer database. I installed Winfax, bought my first Palm Pilot and I was all set. Imagine, I could write a newsletter to my customers, push a button, and each of them would receive a personalized fax, with the newsletter. I became the star of the sales department and then I was asked to take over a senior territory. My sales manager, knowing that I had been keeping a database, asked me to share it with the new sales rep moving into my position. You'd have thought that he was asking for a kidney! This was my database, on my laptop. Of course I did the right thing, I printed a copy of my database, with the last five customer notes - Mr. Generous!



The CRM Champion

When a company is rolling out CRM, they will often look for their "CRM champions" in those reps that have been using contact management effectively. From an organizational change perspective, it would seem to make sense that those that are used to entering customer notes into ACT, or Goldmine, should have no problem transitioning to CRM.

I can tell you from personal experience; It was the ACT and Goldmine users I looked for to be super users for the CRM implementation. These users of course said it was "Great" that we could use Scribe to import their databases into CRM. Once again, "The CRM Dilemma" had a huge hand to play in the minds of these technologically advanced sales reps. I now know the planning had begun for these reps to defeat CRM. The clues were provided in their statements and questions:

• "CRM needs to be as easy to use, as my ACT system."
• "Can I make notes in CRM private?"
• "I have many customized fields in ACT that I need."
• "Who is going to be able to see what I put into CRM?"
• "I will probably keep my Goldmine database in case CRM goes down."
• "I need offline access to my information."

These are very natural things for people in this situation to say. Because we are confident in the superior technology of CRM, we promise that all these needs will be met.

While contact managers can be set up for the information to be shared in a small group, they are primarily designed for single-client use.

The UNSPOKEN, and most important differences - Here's what your contact management users aren't saying:

• "Because I alone see what I put into my ACT database, I only record "High Card" activities."
• "I like that I have admin rights over the information I record in Goldmine."
• "I like that if I am asked to share ACT information, I can do so selectively."
• "I like that I decide what to enter about my activities"

Because of "The CRM Dilemma," the spoken will become the database of excuses, for the unspoken.

Challenge: Since you are reading this, I will assume you have CRM in place that few, if any, sales reps are using. Run CRM activity reports on "super users" that were previously using contact management. I am pretty sure you will find very low usage rates among those that were supposed to be your champions. Unfortunately, "The CRM Dilemma" says that the requirement to enter "Low Card" activities, spoiled all the fun for these key users. They have the advantage of determining all their excuses in advance for not using CRM. Send a link to this blog out selectively and ask for opinions on it. You will be amazed (As I was) at the response once the truth about the "Unspoken" is revealed.

The PACT Difference

By removing the fear of "Low Card," quantitative activity reporting, vast new tools can be provided through PACT, for the contact management user.

17) The Sales Manager

Before I discovered the CRM Dilemma
I was working with one of the largest regions in the company. The head of the region was begging for CRM, and had promised that "Our people WILL use CRM." since I knew "Pressure from above" increases CRM adoption, I made them a pilot region. This story involves a general manager, a sales manager, myself, and 30+ sales people. These events all happened before I discovered "The CRM Dilemma." Now that I have completed this research, what happened in this region makes much more sense. I now know that when CRM is implemented in this region, the results will not be what I anticipated at the time.

The General Manager: As far as clients go, "Jim" was a dream come true for this CRM Project Lead. Young, MBA, analytical, information driven, and very hospitable. As a stop-gap measure, "Jim" had instituted and mandated an Access database log of activities be kept by all sales reps. This hadn't worked because "It was too slow." I had noted that "Jim" had tendencies towards micro management which made the sales rep in me cringe. But I wasn't one of the sales reps in his region, I was the CRM Project Lead who was looking for "Executive buy-in," and I had found it! "Jim" had recently instituted a policy that all managers and sales reps had to keep their Outlook calendars populated with appointments. They were also to add notes to the appontment in Outlook after meeting with a customer. "Jim" was having trouble getting "Terry" the sales manager to keep his own calendar populated.

"Jim" was looking for CRM to provide:

• Sales rep activity snapshot reports.
• Understanding about the "Mood" of customers
• Help to "Keep each other in the loop" because multiple people were calling on the same customers.

The Sales Manager: My first meeting with "Terry" went very well I thought. He was responsible for one of the largest sales force in the company. "Terry" is a seasoned veteran and seemed quite laid back and he reminded me of the sales manager I had when I was a rep. My sales manager was, and remains, the best sales "Coach" I have ever encountered. I remember thinking I was a little concerned that "Terry" may not pressure his reps to use CRM, much like my own sales manager hadn't. "Terry" was hoping CRM would:

• Help him communicate better with his sales reps
• Because more employees were now calling on the same customers, they needed a way to communicate with each other so that customers received a consistent message
• Help to provide better customer service

Before I get to the sales force, you need to know about the sales meetings.

Two Sales Meetings - Big Differences

I had the pleasure of being invited to two sales meetings for this region. The first meeting was run by "Terry" the sales manager, without "Jim" in the room because he was out of town. The second sales meeting was run by the general manager "Jim" with "Terry" in the room.

The meeting run by "Terry" was relaxed with a lot of discussion. "Terry" spoke a little on CRM but I was disappointed there wasn't a stronger declaration. Watching "Terry" in action solidified my opinion that his true strength was in being a sales "Coach." The sales reps clearly liked "Terry" and responded well to him. I also became more concerned that "Terry" wasn't going to put enough pressure on his sales reps to use CRM when we rolled it out.

The meeting run by "Jim" was entirely different. There was very little discussion and it was very much lecture-style. "Jim" spent quite some time talking about CRM and the benefits of CRM to the region. "Jim" made it very clear that the sales force would be expected to use CRM and usage reports would be looked at by him. When "Terry" got up to speak, I noticed he was quite different than when "Jim" wasn't in the room at the last meeting. I could tell there was a tension in management styles between the two.

The Sales Force: This is a very dedicated and diverse group, struggling to meet all their goals in a declining economy. As I interviewed them in groups and individually, I noted that "Terry" was highly respected by them but they didn't like "Jim" very much because of his micro-management style. The sales reps I spoke with had told me they were using their Outlook calendars to record appointments and adding notes. They expressed concern about being micro managed through CRM. We assured them that CRM was being designed as a tool for them. The main frustration they were consitently expressing was that many employees were now calling on "Their customers" and they needed to be kept in the loop on what was being said to customers. In the past, only the sales reps would be calling on customers so this was a huge change for them. They were pleased that CRM could be used to communicate to each other about what needed to be done after a department called on a customer.

Leading Indicators: Now that I understand "The CRM Dilemma," there were several indicators that this CRM pilot will not produce the desired results.

• I thought "Terry" was avoiding me - After our intitial meeting, I was never able to get a follow up meeting with the sales manager. Since I was only there to help him, this puzzled me.
• "Terry" was being pressured by "Jim" to be harder on the sales force and monitor their activities more closely.
• While it is true that sales reps had used the re-occuring appointments feature in Outlook to populate their calendars, not one of them was filling in notes after the customer appointment.
• No call reporting was done by sales reps
• It was clear to me that "Jim" wanted quantifiable data from CRM in order to make business decisions. These decisions would not neccessarily be in the best interest of "Terry" and the sales force.

The REAL story through the lens of "The CRM Dilemma"

I now understand the serious dilemma faced by "Terry" the sales manager in the implementation of CRM. In fact, "Terry" already understands the basics of "The CRM Dilemma," but he can't say anything about it. As the leader and protector of his sales force, he knows they need CRM so they can communicate needed information between each other. "Terry" also knows that with the benefits of CRM comes a huge pack of misery for him and his sales team. In the end, "The CRM Dilemma" will prevail and this CRM initiative will fail:

• "Terry" will not make his reps record their "Low Card" activities, unless he is forced to do so by "Jim"
• If "Terry" forces his reps to record their "Low Card" activities, "Jim" will begin to run reports on the quantifiable, "Low Card"activities of the reps.
• "Terry" will run no such reports because he does not believe in activity control and prefers to coach his reps based on outcomes.
• "Jim" will then go to "Terry" and tell him the changes he needs to implement with the sales force, based on this information
• "Terry" may go to his reps and "Coach" them on what to put into CRM (Gaming) with the purpose of protecting him and his reps from "Jim"
• If reps are entering activities into CRM, but are "Gaming," if "Jim" figures this out, he will either put yet more pressure on "Terry," or he will start going directly to the reps and bypass "Terry."
• The best solution for "Terry" and his sales force is to make CRM go away. If he could just take the "Low Card" activity reports out of CRM, they could all use it as the tool it was intended to be in the first place. This great sales team won't be able to take advantage of the "High Card" communication tools that they really need because "Low Card" activity controls are attached to the system.
• "I know I should be using CRM but.........." will be the refrain heard throughout the sales force.
• If they use CRM just for "High Card" communications, it will negate the excuses they need to use to get rid of CRM.
• CRM will have to die. It will die as long as the entire sales force works together.

To "Terry" and all the other brilliant sales coaches out there, I finally understand what you have been thinking, but not saying. In PACT, I offer a solution that addresses your concerns and allows you to have the tools you really need. There is finally research to prove "The CRM Dilemma" exists and is all too real.

As always, I welcome your comments. In my next post I will share more CRM implementation situations where "The CRM Dilemma" was staring me in the face. I will also admit and share my own story as a sales rep, being asked to share my ACT information, and how "The CRM Dilemma" affected my actions.

16) The dreaded opportunities pipeline

If your company is currently using an opportunities pipeline, you are likely using it for one or both of the following reasons:

1. To understand how many units you will have to manufacture or order to fill the orders in progress


2. To put pressure on your sales force through activity controls

If you are using your pipeline for purpose number one, the system is probably working for you. Because it is used to fulfill sales rep orders, such a system is considered "High Card" by your sales reps (providing it is the only method by which the information is communicated), the reps will regard it as a tool to their advantage.

If you are using it for purpose number two, or both one and two, I am sure the pipeline is a major source of tension between managers and sales reps. The "CRM Dilemma" is epitomized by the opportunities pipeline by being the ultimate in activities control for your sales force. I would also bet that the following is occuring:

• Your highest performing sales reps use (and are required to use) the pipeline, far less than lower performing reps. This is because the pipeline is not a tool, but an accountability. Your best reps require less accountability because "We already know they are doing the right things."


• Sales reps that use the pipeline the most (If you have any) will not represent your highest performers. This is because the pipeline does not truly provide guidance to your reps - They already know how they are doing in sales by knowing their outcomes.

If your reps don't see personal value in the pipeline, they aren't using it anyway so kill it, kill it dead!

The really important pipeline

While opportunities management in CRM is the antithesis of PACT, PACT can be used as your greatest indicator about the effectiveness of your current strategies. Going back to the new product launch in Post #8, which would be the greatest indicator of the acceptance of your new product by sales reps and customers?:

1. A "hit and miss"report from CRM on which reps have said they would do the presentation, and to whom. Combined with:
2. A report on those reps that have completed the presentation. Combined with:
3. A drop-down report from reps in CRM as to why they did not make the sale after the presentation. Combined with:
4. An ERP report on orders received

OR:

1. A report from PACT on those reps that have scheduled appointments with customers during the sell-in period. Combined with:
2. A report on those reps that have requested the new product sell-in package for those customers. Combined with:
3. Feedback from sales reps and customers regarding what they said about the new product line and the presentation tools. Combined with:
4. An ERP report on orders received.

The key difference is that PACT offers a level of safety tin the minds of sales reps because it focuses on planning and communication that they consider meaningful.

15) Steps to converting an unused CRM system to PACT

If you agree with the premise of my research on "The CRM Dilemma", (Why would you be reading this if you didn't?) It probably means you have implemented CRM to great fanfare and promise, only to have your sales force ignore the tools you have given them. You may have tried various sticks and carrots resulting in no marked improvement in usage, or a move to "Gaming" by your sales force. The challenge then is how to resuscitate the system you have, without falling back into the activity control trap that your sales force rebelled against in the first place. It is my contention that this can be done, but it will require a determination to provide a system that your sales force will really view as a tool, NOT a threat. To follow are some steps you can use to achieve this important conversion in attitude.

PACT = Planning and Communication Tool

1. Admit the problem: This may be the hardest part. I am no longer employed because I did this before the problem was identified in our North American role out (The Canadian implementation had failed because of the "CRM Dilemma".) To state that "Our sales force is not willing to record their activities, because they don't trust that we won't use the information against them" is a very bold step that will be welcomed by the sales force, but may be panned by others. This admission shows that we are virtually powerless to understand the day-to-day activities by sales reps, in a quantifiable fashion. You will be amazed at the audible sigh of relief you will hear from your sales force when you remove this tremendous burden from them.
2. Restate the original goals of CRM for your company: You didn't implement CRM in order to control the activities of your sales force, activity controls are an unintended by-product stemming from the desire to offer better service to your customers. By restating these original goals, you set the stage for a new understanding with your sales force and open the door for a new PACT with them.
3. Do an analysis of current planning practices: There needs to be an admission from the sales force that they could do a better job planning their activities. If I were hired by a company to perform this task, I would spend time travelling with various sales reps to identify gaps in activity planning. There needs to be a level of trust in identification of these gaps that does not single out individuals. Planning practices by department heads and executives must also be evaluated to ensure the messages that are reaching the sales force are clear and consistent. I have personally seen situations where sales reps are confused as to their objectives because different departments are giving them conflicting messages on what priorities they should be focused on.
4. Evaluate the information needs of customers: I have always been a top salesman, not because I was a "close friend" to my customers, but because I was able to identify what they wanted to know. Not just about the products I was selling, but providing them information that they would be interested in, and that would impact their business or their lives. For example: A contractor customer is interested in your products, but provide him or her with a market analysis of their industry, and you become a hero to them. Help them to get more business and they will buy your products.
5. Evaluate the information needs of your internal customers: Yesterday, I spoke with a friend that had a problem because she wasn't able to obtain a particular piece of business information on a consistent basis. I showed her how by creating a simple "Google Alert," she could have this information delivered to her as soon as it was made available. I suspect there are many people like her in most organizations. Now she will be able to plan her activities easily because she will be able to consistently get the information she needs. In previous posts, I outlined some ideas on the types of reports sales reps need in order to effectively plan their activities. Providing these reports is key to a successful PACT with users.
6. Plan to provide all the required information: This is where I get into trouble with my friends in IT because I do not provide a magical application to accomplish this, nor do I offer a solution package. The key is that in order to plan activities, employees need to go to one source to find the information that is customized to the customer.
7. Understand and declare what is and what isn't required to be communicated: For the new PACT to be successful, (Used consistently) "High Card" activities (Information that must be communicated in order to progress the sale, or provide feedback that MUST be acted upon) can be the only recording required in PACT. With the exception of training or disciplinary "One offs" identified previously, departments cannot be permitted to add "Low Card" activity recording to PACT. This may have the same implications identified in step one, so executive champions are required to keep consistency in this message.
8. Remove all "Low Cards" from your current CRM application: As painful as this sounds, the days of the "Tick box fields" need to be over. You don't trust the information anyways, so in order to send a positive message of change, all quantifiable information on "Low Cards" needs to be deleted. You will hear yet another cheer from your sales force when they see this has been done! Please don't assume you can leave the information in and it is enough to say that your sales force no longer needs to populate the fields. Quantifiable data remains a "Threat" as long as it exists.
9. Add "High Card" fields and tags to PACT: This step shouldn't be too difficult assuming your company email system is integrated with your CRM system. If "High Cards" are currently communicated through emails, there simply needs to be a link between the customer and that email. If you open the customer record, you need to be able to see the "High Cards" recorded against that customer. There also needs to be customer feedback fields, suited to your organization, that customer-facing employees can use to provide "High Card" feedback. As mentioned before, the ability for employees to view cumulative feedback is as important as managers viewing it.
10. Conduct a pilot of PACT: CRM training has long been forgotten. Users need to be retrained and reminded what the new PACT is all about. Conduct a pilot study to ensure user understanding and acceptance.
11. Make sure the PACT is being honored: With the removal of "LowCard" activity recording, comes new accountability in using the PACT system to its' fullest. Sales reps cannot assume the company has "Rolled over" but rather is providing new tools that are designed to help them sell, instead of watching and quantifying their individual activities. Users and managers alike must be held accountable for their planning and communication activities on a continual basis. Reports of appointments being recorded against customer records and the planning reports requested will be the key indicators of user acceptance.

In my next post I will continue to provide evidence of the value of the information gathered through the PACT system and tackle the issue of The dreaded pipeline.

14) PACT - Change Management Required

By my definition, PACT stands for Planning and Communication Tool. In the dictionary, a pact is defined as an agreement or treaty. In any agreement or treaty, both parties give up some the things they want, in order to achieve a desired outcome that is adventageous to both parties.
The CRM Dilemma Restated:
The problem with agreements on traditional CRM, between companies and users, is the CRM Dilemma causes users to decide that submitting to activity controls is too high a price to pay. They enter in to these agreements knowing that they will not keep them, and yet they say nothing because doing so would validate the CRM Dilemma for the company. The company enters into the agreement knowing full well that they will use activity controls because quantifiable, "Low Card" activity data, is too valuable to ignore. Yet the company doesn't say this because to do so would validate the CRM Dilemma for users.

A PACT gets the truth "Out on the table" by finally admitting that "Low Card" activity controls are the primary cause behind user mutiny against traditional CRM.

Yet, even with a new PACT, there are elements of change management required. New accountabilities are added to the sales force and to managers with this PACT. Because communication in the PACT only involves "High Cards" (What others need to know in order to progress a desired action), change management is more a functional element that can be addressed in training. Planning on the other hand, is an element that many sales reps and managers have not been held accountable for, on an ongoing basis in the past. In instituting the PACT I have outlined, you may want to consider an incentive program to ease the transition into a focus on effective planning.

In my next post I will present some recommendations on incentives you may want to implement along with the new PACT.