Introduction

Making a decision for a CRM implementation software is possibly one of the most strategic decisions an organization can take. When implemented and managed well, a CRM implementation can add wings to help organizations soar, grow and prosper.

This decision involves a lot of time, money, and commitment from all stakeholders, particularly from the business leaders. Many analyst reports show how an unbalanced and myopic approach to this initiative can jeopardize the success rates of CRM implementations.

One of the reports from Gartner stated that almost 50% of CRM implementations fail. Similarly, as per Forrester, 49% of CRM projects fail. Some businesses have failed even two to three times after implementing a new CRM. These statistics are the cause for some much-needed risk analysis and mitigating measures.

All these may seem overwhelming. But many companies do succeed with their CRM implementation. The key here is to learn from other’s mistakes and take the right approach as you embark on this strategic journey.

11 Most-common Reasons for CRM Failure

Inadequate management commitment

Many times, business leaders feel that their responsibility ends after selecting a CRM software. The reality is that it does not end there.  On the contrary, leaders play an important role after that.

One of the main reasons for CRM failure is when leaders expect it to automatically generate revenue, and deliver results. Instead, they need to “walk-the-talk” and start using the CRM themselves. Team members need to see how their managers regularly use CRM for managing their work and business objectives. Managers should not review business performance outside the CRM in some excel or google sheets.

It is important for managers and leaders to set an example. They need to  constantly demonstrate and coach their team members on the best practices, and its benefits. Learning through active observation is much more powerful than just someone preaching!

Misplaced CRM philosophy – Micro-management v/s Empowerment

CRM initiative is a very strategic decision that has the power to help organisations grow and drive predictable business results. It is critical that your team understands the project vision and this core purpose from the leaders.

Your team members should understand that the objective of the initiative is to empower them and make them successful. They should not perceive this like yet another process for managers to monitor their activities and micro-manage them. They should get a feeling that the initiative will add value to their individual performance and productivity, and give them more time and ammunition to excel in their work.

It goes a long way to encourage and motivate your team members to use the CRM software effectively to start seeing results. Leaders need to create ample positivity around CRM usage to make it work favourably.

Measuring Wrong Metrics

Peter Drucker said, “you can’t improve what you can’t measure”. This is true in the case of a CRM initiative as well. It goes a long way when you put together a cadence mechanism to measure your team’s KPIs (key performance indicators) using the CRM.

The ideal KPIs that you may want to measure could include revenue growth, deal progress, sales velocity, pipeline and weighted pipeline, deal conversion rates, sales cycle time, customer retention etc. That way your team will be able to appreciate the business value that a CRM adds. You will have a better buy-in from them that will also help you drive CRM adoption and usage across the board.

However, if you use your CRM to only measure the number of team activities, customer visits, their attendance, working hours etc., it might dilute the very purpose of the initiative. It could even be detrimental to your team’s morale and overall productivity.

Poor Planning

According to MIT Sloan, CRM failure occurs for those businesses that don’t do a prior CRM implementation plan before making the investment. These businesses don’t spend time trying to evaluate their own business needs and  analyse the pain points they wish to solve by using a CRM.

They experience CRM failure not because of the limitations of CRM capabilities but due to their own lack of understanding and planning.

Resistance To Use

Resistance to change is another factor for CRM implementation failure.  People are used to the traditional methods and might be quite reluctant to move to a new way of life. Forcing a new method or software may cause resistance among users to abandon their old familiar methods. Human resistance has a big impact on a system’s effectiveness.

Other reasons for resistance might be due to lack of  training and a clear understanding of the software. This might have an impact on team productivity; eventually leading to frustration among users.

Complexity in Usage

Complexity of the software is another major factor for CRM implementation failure. While your business might  need a  CRM software with a simple interface, there are chances that you might land up  choosing a complex CRM. Because of its wide functionality and features, a CRM system can sometimes be complex to use. Users who are unfamiliar with CRM systems and who prefer to use a simpler interface can get overwhelmed with this complexity. For instance navigating through many screens just for one feature can be time consuming and frustrating.

Cumbersome Data Entry

Another important reason why many CRMs fail is that the end-users find data-entry very cumbersome and laborious. Sales team members are required to update the CRM regularly, which requires them to devote their time and effort. This may not happen if they find the CRM software interface not very seamless and easy to use. Not using the system to the full potential is one of the main issues in implementing CRM.

Lack of Customization

Few CRM systems might provide just basic functionality and may not be flexible enough to accommodate customization to meet specific client needs. In that case, businesses may not be able to align their CRM initiative with their needs and priorities. This will be a huge impediment to achieve your company goals.

Inadequate Training and Support

The efficient usage of CRM software heavily depends on the training and support provided by the CRM vendor. End users may not use it to its full potential if they lack adequate training support. Without proper ongoing training support,  users might face challenges and it can hinder end-users from effectively using all features in the CRM.

Poor  Fitment

One major cause of CRM failure is the insufficient compatibility of CRM software with the unique requirements of the enterprise. This substantial gap between the softwares capabilities and the organisation’s objectives hampers the installation of the CRM to a great extent.

Selection of Wrong Implementation Partner

There are many CRM projects that have failed not because of the software but by selecting the wrong implementation partner. It is important that the implementation team is well equipped in terms of expertise, domain skills, experience and knowledge required for implementing this software.

Best Practices for CRM Implementation  – Steps To Mitigate Risk of CRM Failure

Now that we have discussed the various challenges in implementing CRM successfully, let us discuss what important steps will help you to mitigate all the risks.

Proper Goal-setting and Planning 

Clearly define your goals and objectives for implementing a CRM software. It is a good idea to make a note of all your pain points that you are planning to solve and the business objectives you want to achieve through this transformation initiative. It is important to have a clear vision of where your company should be after implementing the CRM software. Defining a purpose will serve as a guiding principle to help you at every step during the CRM implementation journey. Try to outline the CRM implementation process, including planning, customization, data migration and training.

Committed Leadership

The commitment from the leadership team plays a pivotal role in making the CRM implementation successful. Shifting from old traditional systems to a modern one needs a lot of commitment and focus. Transitioning to a new CRM will be easy only when everyone in the organization is committed to it and are encouraged to use it. The leadership team has to clearly pass on the message as to why are you implementing this new software. The Whys and Hows have to be clearly communicated to all the stakeholders across the organization.

Buy-in From End-users

Gaining buy-in from end users is very important for successful CRM implementation. This means that all the stakeholders involved and directly affected by the new process comprehend the need for the change. It is necessary to make them understand the benefits and objectives of the proposed change. It is a good idea to take inputs from the end-users while evaluating the right CRM software. This enables  them to feel valued and motivated; and in the process they will willingly participate and cooperate with the new change. This will ensure  increased productivity and overall success of the implementation.

Management Reviews Using CRM

It is very important for managers and leaders to lead by example. Often, they are so used to using Google sheets or excel sheets that they fail to embrace new technologies. It is important that they need to practice and demonstrate the benefits to employees.

The CRM platform should be actively used by managers and leaders for all their reviews and interactions. By doing so, they effectively communicate to their team members that the new system is worthwhile to integrate into their daily workflows.

When managers start actively using the CRM system in team meetings, the team members get inspired and follow suit. They start experiencing the effectiveness of the CRM on how it increases productivity and offers insightful data to help them with their performance.

Consistent Usage Across the Board

Consistent usage across the organisation is one of the important strategies for successful CRM implementation. A CRM can deliver significant benefits only when it is used to its full potential. Therefore it is very important that every stakeholder involved uses it consistently and effectively. It enables cross functional collaboration when individuals from different departments use the CRM to share information.

This helps to a great extent in decision making. With up-to-date information available from all stakeholders, management can use this data to identify trends, track important KPIs and make informed decisions.

Constant Feedback Mechanism

Consistent feedback from the users is one of the best practices for CRM implementation. Getting first-hand information from users in terms of systems usability, software’s ability to meet objectives and its impact on time management etc., helps the management to take proactive steps. This information enables management to make informed decisions before issues escalate.

Consistent feedback helps in improving user experience. Businesses can identify the pain points, usability issues and places where CRM falls short. With this knowledge, they are able to quickly address these issues, improve the system’s usability, and better the user experience as a whole. By addressing these challenges, management demonstrates their commitment and dedication to make the CRM implementation successful and help users have a positive CRM experience.

Progressive Adoption – Start Small and Then Expand

A proven approach for a successful CRM implementation project is to start small and gradually expand. You may not want to boil the ocean with all the features in the first phase. It is a good idea to focus only on the necessary must-have features that have the highest impact on your business.

This enables businesses to efficiently manage the deployment process, reduce risks and ensure a smooth transition among users.

You may also consider the CRM roll-out for a specific department, and then expand to other departments. That way the early users can share their success stories, offer insightful advice, and assist in addressing any objections or worries from other users. Their positive experiences and feedback can have an impact on the larger user base and help the CRM deployment gain momentum.

Selecting The Right CRM Software

Choosing the right software will help you resolve most of the issues mentioned above and plays the most important role for succeeding in your CRM implementation journey. Following are  few important points to consider when choosing the right CRM software

● Easy to Use

The success of a CRM largely depends on how much the users adopt and use it. Users love to use the CRM only if they find it easy  and simple to use. A user friendly CRM should have a simple and an inherent interface that enables the users to navigate easily through different functions. The data entry should be seamless.  People with less technical knowledge also should find it easy to use. The actions they have to perform should be easy to comprehend without the need of in-depth instructions.

● Customization

First and foremost, try to choose a software vendor who is flexible enough to align with your business objectives for installing a CRM. The vendor should be ready to offer customization so that you are able to align the CRM with your business needs and priorities. The CRM should have the features to address your pain points and meet your future business goals.

● Adequate Training Support

Make sure your CRM provider has an effective internal customer support and training team.   This gives your users the chance to learn the system thoroughly while also receiving excellent hands-on training. This is crucial since the success of the CRM implementation depends on how extensively and effectively the users utilize it. They can completely lose interest in using the CRM if their questions are not promptly answered or if they are not properly trained. Their effectiveness and productivity can be greatly increased with the right training and assistance.

● Intuitive Dashboard

Having a dashboard that shows insights to real time data helps the management to have a quick view of the performance of their team members.  The management should be able to quickly and easily understand the performance of the team members.   Thanks to this real-time visibility, it helps the management team to quickly respond to urgent situations and take proactive steps whenever necessary.

● Pricing

In order to attract customers, few CRM software companies offer a very low Tier 1 pricing with very limited features. As your business grows and when you want to expand the number of users or add more records into the CRM, the pricing might be far more expensive. Choosing a CRM software vendor who offers a comprehensive framework with no hidden costs is a good solution to this.

Choosing The Right Implementation Partner

Choosing the right implementation vendor plays a very important role for a successful CRM journey.  It is advisable to select the right CRM implementation partner along with the CRM software. This will prevent any unexpected surprises and ensure a smooth implementation process. It is also important to evaluate the expertise of the implementation vendor, assess their industry experience and also see if they have a proven track record of successfully implementing CRM systems. Their technical know-how, experience and customer service plays an important role for the success of the CRM implementation.

You should also discuss the project timelines, milestones and cost of implementation to arrive at the overall TCO (total-cost–of-ownership). Knowing the overall TCO enables you to ensure that it aligns well within your budget.

Here is a detailed reference guide to help you choose the right CRM software vendor for your business.

Summary

In summary, customer relationship management software enables you to organise and manage client data in a structured way. Businesses can make wise decisions to increase revenue and boost profitability measured using a CRM.  It provides better visibility and a “single-version-of-truth” across the enterprise.

However, a CRM initiative’s success significantly depends on how the project is approached. In order to optimize the benefits of the implementation, careful planning and execution are essential. Organisations can reduce the risks associated with CRM installation by adhering to the best practices mentioned above. Organisations can realise their full potential and increase sales and profitability indicators with a properly implemented CRM system in place.

When you are knowledgeable about all the barriers, you can overcome them and plan well in advance to grow without boundaries!

Author Bio
Author Name: Navin Nair
Navin is the Founder & CEO of HappSales. He comes with 25+ years of industry experience in sales and key account management. Armed with vast experience, insights and a great team, he is on a mission to help companies and customer-facing teams in getting their jobs done faster & better, while maximizing their happiness quotient!