Selecting a CRM System

Engaging IT people to choose a CRM application is like engaging a mechanic to choose your new car.  What's under the bonnet may be important; but there are far more fundamental considerations which must first be addressed.

So many companies have purchased the equivalent of a Ferrari without yet having a driver's license, or even knowing where they plan to go with their new vehicle.  Maybe they should have opted for a 4-Wheel-Drive, or even a bicycle?

Gil Thew, the principal of Wolken Technology Management, says that "about half of the CRM systems bought by Australian companies over the past 2-3 years are now disconnected, because of problems in implementing them."

You certainly don't want to be in the wrong half of those statistics.

Brett Kennedy, the Australian manager of e-Business and CRM for the software company Oracle, has said … "Some organisations believe that simply deploying technology is enough to get the organisation to take advantage of the investment.  But many of these CRM implementations have been failing because the cultural change has not happened inside the organisation.  The equation really has to be IT plus business process plus change management plus training."

We think he is right … except the equation runs the other way around.

The world-wide research company Gartner says that "about 50% of the CRM systems around the world are now regarded as failures by the companies that bought them."

Make that 'expensive failures', since Gartner estimates that "a CRM application costs $30-60 million for an average sized listed company.  Small and medium-size companies may pay less; but they can experience similar problems."

Several research studies in the US claim that about 70% of CRM projects fail and are abandoned.

Tony Lucas, CRM practice leader at Deloitte Consulting, says that … "one reason for CRM projects failing has been their isolation from the rest of an organisation's business objectives.  Also, companies were trying to build long-term, larger projects as opposed to short-term ones that deliver results."

Jill Dyche, the author of 'The CRM Handbook' recently told CIO magazine … "Many companies underestimated the magnitude of CRM.  They treated it just like another application or technology.  But CRM is a strategic initiative that touches all areas of the company, if it is done right."

By now you are probably wondering whether you really want a CRM application at all.  In fact, Edensilk is a great proponent of CRM; but you don't want to go about it the way everyone else is.  Let's now look at the bright side …

One company that is happy with its CRM program is Westpac.  Peter Hanlon (the bank's GM Group Marketing) began discussions about CRM years ago.  We like what he says best of all … "At that time our customer contact involved writing letters, inserting brochures with them, and trying to get customers to buy something.  Then we changed our focus to identifying customer benefits.  For example, if we found that a customer had a large amount in a transaction account, we would contact them by mail or phone and suggest they move it to a high-interest account.  This is CRM, and it is these kinds of processes that we have automated using technology.  However, it is important to have a company culture that wants to operate this way, because if you just install the technology without getting the culture right, you won't succeed."

The relationship management services executive at AMP Financial Services, Peter Lalor, is a fan of CRM, if it is implemented correctly.  "CRM is not rocket science or new.  It is about re-emphasising the need to manage customer relationships, and technology is now available to make this easier.  We spent a long time thinking through what we wanted to achieve and what could be improved."

So how are you going to go about implementing CRM in your business?

Edensilk will help you put the 'C' back into CRM by focusing on the customer rather than the technology.  We'll help you, and all affected staff, to clarify your mind set, strategies, tactics, and processes - well before you go shopping for anything that pretends to be a 'silver bullet'.

Paul Curtis, one of our consultants, has been personally involved in the use, sale and implementation of several CRM applications including Siebel, Pivotal, Microsoft, Goldmine and ACT.

We can help you do the necessary preparation for a successful CRM implementation.  Once you know exactly what you want from the technology, and why - it's easy to choose the appropriate CRM technology to support your intentions.

Without our help, why not just flip a coin?  Your chances of success are about 50/50 whatever application you choose; because it's not about the software, it's about you and your organisation.

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