If executed correctly, CRM can deliver phenomenal perks, from boosting customer satisfaction and generating leads to increasing profits and slashing operating costs. There are, however, plenty of ways to stumble on the path to CRM success. Here are the top five strategies for avoiding the most common CRM mistakes.
1. Start small. According to Tim Hickernell, an Info-Tech Research Group senior research analyst, the biggest mistake companies make when introducing CRM is "trying to bite off more than they can chew." Certainly, most CRM solutions include three primary applications: SFA (Sales Force Automation), marketing and customer service. Many vendors have consolidated their solutions into a single, comprehensive suite that runs the gamut of CRM functions. But that doesn't mean a company has to address every area, from call-center efficiencies to marketing-campaign management, in one fell swoop. Rather, Hickernell recommended adopting a piecemeal approach to CRM and adding new functionalities as the need arises.
2. Don't skimp on an integrator. Don't fool yourself: neglecting to hire a systems integrator when introducing CRM is less about cutting costs than it is about cutting corners. Warned Hickernell, "For larger companies, just given today's integration, deployment and implementation issues, it really is smart to try to have help." More than simply a valuable partner in the implementation process, a systems integrator can also help a company develop a customer master data strategy that determines which systems contain the most accurate and up-to-date information.
3. Hosted isn't the deployment approach. When it comes to rolling out CRM without breaking the bank, many companies assume that a hosted solution is the only way to go. But that's just not the case, according to Hickernell. "People make the mistake of continuing to go with a hosted solution based upon an economic decision of operational savings, which only gets them into trouble," he said. Instead, an on-demand CRM solution allows for a gradual approach on a pay-per-seat, per-monthly basis. What's more, the SaaS (Software as a Solution) model allows for granular — not enterprisewide — technology upgrades at a fraction of the cost.
4. Customize carefully. Unfortunately, many companies don't know when to leave well enough alone. The software-customization craze has prompted many businesses to attempt to tailor a CRM solution right down to the database level without giving any thought to future needs and product life cycles. Cautioned Hickernell, "Resist the temptation to customize at that database level because once you depart from the vendor's actual information architecture, that's what really gets you into trouble." What's more, customization can easily drive up the costs of a CRM solution, minimizing the chances of reaping a prompt return on investment.
5. CRM is not a magic bullet. Your sales department is struggling to organize its leads and your company's marketing executives are working on a hodgepodge of ineffective campaigns. If you're hoping a CRM solution can set things straight, think again. "It's always an indication of potential failure if a company tries to bring in a technology vendor to solve a problem without looking at its organizational and process issues," said Hickernell. While a CRM solution can deliver better customer service and streamline marketing efforts, it's vital for a company to establish a solid foundation beforehand with a series of best practices and processes. In the end, companies need to view CRM as a technology project — not a business strategy.
If you find that your CRM solution is prone to any of these errors, you need to quickly and effectively resolve the issues. Of course, the resolution for each of the mistakes is different and will be unique to your company and its situation. For instance, if your sales force expects CRM to deliver more leads without increased effort on their part, you may need to explain to them why CRM is not a magic bullet and adjust their expectations accordingly. Regardless of the error, it is important to address it as quickly as possible so as to minimize further CRM inefficiencies.
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