Many organizations find out after they implement a CRM system that it doesn’t automatically cause their sales force to become more efficient. CRM systems assist organizations with managing customer interaction, organizing sales activity, tracking opportunities, and increasing revenue.
Even though they have invested in CRM software, some organizations will still face issues such as missed follow-ups, inaccurate sales projections, long administrative tasks, and poor communication with their customers. Managers will continue to find it difficult to pull accurate reports from the CRM software to understand what is happening within their business, while salespeople will continue to spend a majority of their time updating records rather than talking to potential buyers.
The failures of CRM systems to enhance sales productivity raise a critical issue: What causes CRM systems to fail to enhance sales productivity?
Poor planning, poor user adoption, unconnected business systems, lack of quality in the data used to feed the system, and sales process workflows that don’t reflect how actual sales are made are all factors that will cause a CRM implementation to fail to deliver on its promise.
The purpose of this article is to examine why so many CRM implementations fail; the impact that such failures have on sales performance; and what practical steps organizations may take to develop a CRM system that actually works for their sales team.
CRM implementation is the process of implementing a Customer Relationship Management (CRM) software within an organization. The process includes the collection of employee/customer data, the creation of sales workflow(s), the establishment of user permissions/roles, the integration of other business-related software applications into the CRM software, the education of employees regarding how to utilize the CRM software, and the development of reporting procedures.
A properly implemented Customer Relationship Management (CRM) system will provide sales representatives with tools for lead management, opportunity tracking, follow-up prioritization, and maintaining current customer records. A CRM system will additionally provide sales management with improved insight into the performance of the sales pipeline and revenue forecasting.
However, merely having a CRM system is insufficient. It must align with the organization’s overall sales strategy and day-to-day business processes.
An example of this would be if a company were to use Salesforce to combine all customer data in one location. However, if sales reps continue to create their own spreadsheets and management continues to ask for manual reports, then the company will most likely have more administrative work than they did prior to the implementation of Salesforce.
The actual goal of CRM (customer relationship management) system implementation is to enhance the way that individuals sell, communicate with customers, and make business-related decisions. It is not just about bringing in a new software program.
The reason many CRM implementations fail is due to low user adoption. While a CRM system may have sophisticated features, these features will have very little benefit if the sales representatives do not use them on a regular basis.
Employees may resist using the new system due to its complexity, the perception that it creates more work for them, and/or lack of understanding regarding how the new system will improve their job performance.
In some companies, sales teams will use spreadsheets, emails, and/or personal notes instead of CRM systems since they are what the team members are used to. Therefore, the data that is collected from customers can be found in many different places, and managers can’t depend on reports generated by the CRM system.
How to fix it
Businesses should include their sales staff when implementing a CRM system, as opposed to implementing the system and then including the sales staff.
Ask your staff about the types of jobs that are the biggest time wasters for them, what knowledge is required of them when communicating with customers, and what current methods cause them the greatest amount of stress.
Provide hands-on training that is relevant to what your employees will do each day. Rather than teaching employees everything they can do with a CRM, demonstrate how employees can use the CRM to complete daily tasks (e.g., update an opportunity, set up a follow-up, view customer history).
Organizations should also track how many people use a particular feature by tracking metrics such as employee usage and employee feedback. If you find that employees do not like a feature, it would be wise to find out why employees may not want to use that feature prior to concluding that the employees are simply resistant to change.
A CRM system is most useful when employees view it as a productivity enhancement tool for selling, and not as a bureaucratic requirement.
Another major CRM implementation challenge is excessive process complexity.
Businesses sometimes add too many mandatory fields, approval processes, record updates, and manual steps into their systems. These requirements may be put in place to help collect better data and create controls, but they can unnecessarily complicate the simple tasks required for sales professionals.
For instance, when a salesperson is writing up a proposal, they will have to fill out many different CRM fields prior to advancing the opportunity to the next level. If there are several fields that are not relevant to that specific deal, then the process has created more work but has not improved the quality of the sales decision.
CRM workflow design will lead to employees spending more time keeping their records up-to-date and less time interacting with customers.
How to fix it
Before you configure your CRM workflow, you will need to review your current sales process. At that point, you should identify what data is necessary for your sales process, what parts of your sales process can be automated using technology, and what steps in your approval process can be simplified.
Selectively use required fields in your sales process, and make sure that every sales stage has a well-defined purpose. When possible, automate record updates, creating follow-up actions and notifying applicable employees.
The goal is to reduce unnecessary manual work while maintaining the information needed for effective sales management.
CRM systems require accurate and consistently maintained customer data. Sales reps will be unable to rely on the data provided to them if there is a problem with the quality of that data (i.e., duplicate contact records; old telephone numbers; missing company profile information; and/or incorrect lead status).
CRM data quality impacts the ability of sales reps to perform efficiently. For example, a rep may call on a single prospect more than once; forget a customer’s past purchases and interactions with your company; or spend too much time checking out details that are likely already contained within the system.
For example, a business can create two or more entries for the same customer within their CRM system. One salesperson may enter the customer as a brand new lead, while another salesperson enters the customer’s contact information as a previously existing opportunity but with a different variation of the customer’s name. As a result, there are multiple disconnected entries for the customer in the CRM system, making it very difficult to obtain a comprehensive view of the entire customer relationship.
How to fix it
Before importing data into the new CRM system, conduct an audit on the current database and delete irrelevant records, eliminate duplicate entries, and fix inconsistencies within fields.
Create a set of standards for how company names, contact information, where leads come from, and what stage an opportunity is at will be represented. To avoid repeating issues with the same types of errors, use validation rules and appropriate tools to help manage duplicate records.
Responsibility for ensuring record data quality should be assigned. Periodic reviews of records that have not been modified during a specified timeframe should occur.
When you have clean customer data, your sales reports will be more reliable. Also, your representatives will need to spend less time looking up information.
Many sales groups will utilize a variety of applications, such as marketing automation tools, emails, accounting software, customer support, and proposal management.
When the different systems function separately, employees need to manually share data across them. This results in double work, greater opportunity for mistakes, and does not allow for a single perspective of every client.
For instance, if a marketing department generates a good prospect with a promotion and that data does not automatically populate into the CRM, a salesperson will probably get the lead late and/or not have enough background on it to conduct a quality conversation.
How to fix it
The next step is to determine what other applications require exchanging data with the Customer Relationship Management (CRM) system, and also how this data will flow from one system to another.
CRM integration allows for synchronization of customer records, marketing activities (campaigns), sales opportunities, and other relevant information. The type of integration used will depend on the technical requirements of the organization, with options including APIs, prebuilt connectors, middleware, or custom development.
Businesses need to establish who owns what types of data. When there is no clarity on who has ownership of the different kinds of data, it will lead to conflicts when using various types of systems that update the same data. It may even destroy correct data.
Effective CRM integration allows for a reduction in the amount of time data is entered into the system. It also provides sales professionals with the appropriate information required to provide rapid responses to potential customers.
A failure in a CRM implementation occurs if the setup reflects a perfect model of a business process, as opposed to how your sales force operates.
Organizations often use standard pipeline stages without taking into account how they sell, what types of customers they serve, how those customers make purchasing decisions, and/or who needs to approve each sale.
An example of this would be if you were a business that sells enterprise-level software. This would likely require multiple discovery sessions, technical review, security assessment, and finally some sort of negotiation before closing the deal. If your generic pipeline was only made up of three stages, you would not be able to adequately track how well you are doing in each stage.
Conversely, an uncomplicated sales process will become excessively complex if there is an excessive number of steps and conditions added.
How to fix it
Map out your current sales process before creating a CRM workflow. Determine what actions, decisions, and data are necessary for each step of your sales process.
Stages create opportunities for significant advances in deal progression.
Defining clear entry/exit criteria will allow sales representatives to determine if a deal has progressed sufficiently to advance to the next stage.
Create stages for the sake of making reporting more detailed. Each stage should be used by the business to provide understanding about where deals are at, what risks exist, or what steps need to be taken next.
A CRM system that supports the sales process used by the organization provides better insight into the sales pipeline and assists sales professionals in prioritizing their work.
Sales reps often complete the same types of tasks regularly. These may include: sending follow-up emails; making updates to the field of opportunities; creating scheduled reminders; and generating routine reports.
The time consumed by these manually-driven processes is time which would otherwise have been used for developing customer relationships and closing sales.
For instance, a salesperson could potentially neglect to reach out to a potential client following a demonstration of the company’s product if there has been no scheduled follow-up on the part of the sales representative. While the CRM contains the required details for a successful follow-up, the lack of timely reminders can result in loss of sales opportunities.
How to fix it
You can automate those repetitive tasks that have a predictable pattern and are safe to automate.
The ability to create automated follow-up reminders, task assignments, lead assignments, notifications, and updates to specific records is determined by each CRM system. One such system, Salesforce Flow, is capable of automating numerous forms of declarative workflows.
Automation is a tool that supports the sales process. Automation does not increase the number of notifications sent out to users, nor does it create extra work for users. Evaluate how each automated task affects the overall workflow. Ensure employees are aware of how the system functions.
The best CRM automation takes away some of the day-to-day hassles and lets salespeople spend time doing things that will help generate more money for the company.
A single training program is unlikely to prepare your staff to use a CRM system effectively across multiple scenarios.
Sales reps have some knowledge of how to use the system; however, they are often unable to manage opportunities, create reports, adhere to standard procedures for entering data, and utilize more advanced features. Without employee support to help them learn these systems, employees will begin to develop inconsistent methods for using the system, which can eventually lead to the loss of reliability in the CRM.
Business introduction of new features without providing an explanation of how these features may alter current business processes makes this issue even more severe.
How to fix it
Create a formal customer relationship management (CRM) employee education plan based upon an individual employee’s job function and experience level.
Salespeople must be trained to handle leads, update opportunity status, make appointments for follow-up, and obtain customer data. Sales management should receive further training regarding sales forecasting, analyzing the sales pipeline, and reporting performance results. System administrators require training on how to configure the system, assign permissions to users, and troubleshoot issues.
Provide short reference guides, practical demonstrations, and a clear process for reporting issues.
Implement continuous feedback collection after implementing the system and provide refresher training as your workflow changes. Continuous support will help keep your CRM usage consistent as your company continues to grow.
The purpose of a CRM system is to provide sales management with a clear view of the entire sales process. However, if there are issues with the quality of data, poor design of your dashboard, or inconsistencies in how you define each stage of your sales process, your reports may not be accurate.
When managers don’t believe that CRM analytics can be trusted, they will either use spreadsheets to manually track data or base their decisions on partial information.
For example, although a sales dashboard may indicate a large amount of potential revenue (a healthy pipeline), many potential customers may not have received an update on their accounts for several months. Therefore, while the dashboard appears positive, it does not provide accurate insight into the probability of creating new business.
How to fix it
Before you begin developing your CRM dashboards, identify which key performance indicators are important to your organization.
Useful sales productivity metrics may include:
The establishment of clear definitions for each metric used in this process should be done consistently. In addition to establishing consistency among the metrics, the data in the CRM system must be verified as accurate.
Dashboards help managers make better decisions based on the data displayed, rather than just displaying a lot of information. Dashboards allow managers to see what opportunities have stopped moving forward, what areas of the business are having issues converting leads into sales, and if there are any employees who are overwhelmed with work.
An organization may begin a CRM project before it has established what its business goals are.
They will likely choose a software platform, migrate their data to it, and configure its various functions without having first established what “success” would look like. This means that while they could technically complete the implementation, the implementation may not solve the business issues which led them to invest in the software.
For instance, a business can utilize a customer relationship management (CRM) tool to improve how many prospects turn into customers; however, if they do not create a starting point for measuring how many of their prospects currently convert into customers, or understand what causes some prospects to be lost, then there is no way to tell if using the new CRM software has actually increased their conversion rates.
How to fix it
Start with measurable goals for your business. For example, you may want to reduce administrative hours spent on tasks, ensure that you consistently follow up on leads and prospects, increase the percentage of leads converted into sales, and/or improve the accuracy of your sales forecasts.
Document the existing levels of performance, and identify appropriate targets that can be met. Develop an implementation strategy that includes the following elements: Data Migration, Integrations, User Training, Testing, and Post-Launch Support.
Assigning responsibility for the project, as well as involving key players in the organization (i.e., Sales, Marketing, Operations, and IT), is critical to its success.
After your system has been deployed, compare what actually happened to what you originally wanted to happen. By doing this, you will know if the CRM is helping the company save money and what you need to do next to make the CRM work better.
Businesses can enhance their use of Customer Relationship Management (CRM) through the application of a small number of core concepts.
Begin with business requirements. Choose and configure CRM functions based on specific sales issues instead of installing function(s) just because they exist.
Simplify the user experience. Do not include unneeded fields, complex steps, or repeated actions.
Maintain accurate customer records. Create clearly defined standards for how data will be collected and managed, establish who owns each piece of data, create a process to verify that all data collected is correct and up-to-date, and regularly clean up any unnecessary or outdated information.
Incorporate the primary business applications. Minimize manual transfer of data and provide access to all relevant customer information in a single location.
Invest in Employee Adoption. Have employees participate in the design of the product, train them on how to use it, and receive their input.
Measure your company’s performance. Track improvements in sales productivity, the rate at which you convert potential customers into paying ones, the amount of time it takes to complete a single sale from start to finish, and how well you can predict future revenue.
The process of continuously improving is ongoing. It involves reviewing your business processes, automating those processes, integrating with other systems, and reporting on the performance of each of these areas as your business grows.
CRM will be transformed from a data management system to an effective tool for improving the performance of the sales team.
CRM systems do not help sales professionals become more productive if organizations just install the software and do not address the other areas (processes, people, data) that affect how well the system will work.
If there are low numbers of people using the system, the process is too complex to use properly, there is inaccurate information being entered into the system, the different systems aren’t connected to each other, the users aren’t trained well enough to use the system, or the reports generated by the system aren’t reliable then the CRM will not deliver the expected results.
The answer lies in viewing the process of implementing a CRM system as an organization’s business process improvement effort rather than a software installation program. To do this, companies need to make their sales processes less complex, automate routine activities, link key software systems together, keep current employee-customer interaction data available, and offer continuous training to employees.
Businesses need to assess their achievement of goals using relevant metrics (results), which include higher conversion rates on leads, shorter periods of time for follow up, more precise forecasts and less administrative tasks.
When CRM technology matches the requirements of actual sales processes, then sales professionals will find it much easier to track potential deals (opportunities), establish relationships with customers and focus on producing income.
For organizations experiencing ongoing problems with their CRM systems, Salesforce consulting and implementation services can provide assistance in identifying areas where configuration may be lacking, improving existing integration of systems, and creating a CRM solution that will support long term sales productivity.
CRM projects frequently fail due to bad planning, low adoption rates by users, poor-quality data, difficult-to-follow workflows, inadequate training for users, and poor integrations between the CRM project and other software systems used within the company.
A good implementation of a Customer Relationship Management (CRM) system can provide sales representatives with a way to organize their leads, keep track of potential business deals, create a schedule for following up with customers, look up customer data, and automate many of the day-to-day administrative tasks they perform. By providing these tools, sales reps can focus more of their energy on productive sales-related activities.
Sales teams can help increase acceptance of the new CRM by being involved during the implementation process; reducing workflow complexity; providing sales representatives with role-specific training; collecting representatives’ feedback about the new CRM; and showing how the new CRM will support their daily sales activities.
There are many ways to tell when your sales process is broken. These may include employees creating their own spreadsheets, having multiple records for one customer, forgetting to follow up on leads, being unable to rely on reports generated from a system, spending too much time entering data into a computer, and not consistently updating information in your sales funnel.
Yes, the integration of a CRM system will allow for less manual typing of data, while at the same time allowing the company’s systems to communicate with each other so that the most current data is available to all of the departments, such as marketing, accounting/finance, customer service/support, etc. Having up-to-date data available will enable the sales department to answer questions quicker and make better business decisions based on current facts.
Businesses might want to look into CRM consulting if they are having issues with poor adoption, difficulties in keeping up with workflows, repeated integration failures, unreliable reports, or if the system is not supporting their current sales process. A consultant would evaluate the existing system and make suggestions on how to improve it.
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