More than a decade and a half of research on Customer Relationship Management (CRM) systems has churned out consistently troubling failure rates for CRM implementations. Since Gartner’s 2001 study found a 50% CRM failure rate, study after study has reported failure rates between 30% and 70%.

These numbers make a lot of would-be CRM adopters understandably nervous. After all, CRM is not cheap. It’s easy to look at the failure rates and see CRM advocates as hucksters, and CRM implementation as (at best) a gamble rather than an investment.

But CRM failure isn’t simply a bad spin of the wheel. CRM failure is often the result of a fundamental misunderstanding of what CRM is, does, and requires. Too frequently, CRM is treated like a magic wand that will wave away all the problems facing Internet Age business.

Some of that is on CRM advocates. We see the possibilities that CRM can create, and we get (understandably, I hope!) super excited. We see a technology that can help transform a business.

But CRM is not just a technology solution, and it is very definitely not a magic wand. Treating it like one is often why CRM implementations fail.

And they don’t have to fail! In fact, we’ve had only 2 failed projects in more than 300 implementations.

So how do you beat the odds? It starts with understanding what CRM is and does (and isn’t and doesn’t!), learning why so many implementations fail, and then embracing business processes designed to help you avoid the obstacles to CRM success.

 

So what is CRM?

CRM helps you align your business processes with your customers to improve the quality and consistency of your relationships, build loyalty, and increase profitability.

CRM data visibility and analytical tools can help you create effective marketing, manage your sales pipeline, and make more informed business decisions, while CRM automation tools can help you be more responsive to your customers and markets.

CRM helps you implement, optimize, and manage your customer strategies and business processes. It does not replace or create those strategies or processes.

Adopting CRM before creating effective, customer-centered business processes, or before considering what you need from CRM to get the most from those processes, is a recipe for failure.

 

Why do so many CRM implementations fail?

Although there are many reasons why CRM implementations fail, we tend to see three main categories of failed implementations:

 

1.) Process failures

Too many would-be CRM users see CRM as a technology solution when in reality, it’s a business strategy. The technology enables the strategy, but the best tools in the world won’t build a house on their own.

CRM is no different. Without clear, measurable goals attached to strong business processes and a willingness to learn and grow based on your results, your CRM will do little more than collect and store data, or worse, might even help you make the same mistakes faster and with more customers.

At the same time, data quality is critical to making CRM a useful tool. Bad data in means bad data out, and that can cripple your ability to analyze the processes you have in place.

Before adopting CRM, ask yourself these questions:

• What specific, measurable outcomes are we hoping to achieve with our CRM implementation?
• What is our strategy for achieving those goals, and what processes must we implement and optimize to carry out that strategy?
• What do we need our CRM system to do, and which systems do what we need?
• How will a CRM system fit into and enhance our existing business processes?
• How will we measure success?
• How will we manage change based on data-driven analysis?
• How will we ensure data consistency and integrity?

 

2.) Adoption failures

Too often, businesses find their people aren’t using CRM to its full potential (if at all). Their employees may not have bought into CRM, or may not have been adequately trained or incentivized, or there may not be top-down support for CRM adoption and implementation. But the result is often an expensive Rolodex.

Before adopting CRM, ask yourself these questions:

• What does my team need from CRM? What specific benefits will CRM provide to my team? How will I communicate those benefits?
• Who will be the project champion? How will that person ensure successful implementation and adoption?
• How will we ensure and demonstrate executive and management buy-in?
• How will team members be involved in the adoption process?
• How will we train our team to use CRM? How will we keep CRM user-friendly for team members?
• How will we support users who have CRM questions or problems? Will we do this in-house, or with a CRM partner?

3.) Integration failures

Your CRM needs to match your business process and vice versa. If there is no match, then there is no benefit, even if your CRM system is top-of-the-line.

CRM is sometimes disruptive, but it should never be destructive. If you would need to fundamentally change the way you do business in order to implement a CRM system, you need to ask yourself whether the affected processes need changing. If so, then you should do so regardless of any CRM solution. If not, you are likely looking at an incompatible system.

Before adopting CRM, ask yourself these questions:

• How will a CRM system fit into and enhance our existing business processes?
• Which CRM systems would require us to change our business processes to use effectively? Would those changes be benefits, or burdens?
• Which CRM systems do what we need to accomplish our goals? Are they scalable? Customizable? Reputable? Well-supported?
• Which systems would require us to pay more for tools we don’t need and aren’t likely to grow into?
• How will CRM fit into our current IT structure?
• Do we use other technology solutions that require or would benefit from integration with CRM?

 

How do you avoid CRM implementation failure?

Answering the difficult questions before beginning your CRM implementation is critical to your success with CRM. Underestimating the complexity of implementing CRM can doom that implementation, and although no plan is perfect, having no plan is disastrous.

Don’t work with systems or vendors that will force you into one-size-fits-all solutions. You need to find a system and a vendor that will work for you, not the other way around. Don’t ignore the process underlying your practice. Don’t scrimp on training. Don’t assume or underestimate the importance of top-down buy-in.

But above all, don’t fall into the trap of treating CRM as a magic wand. CRM may be exactly what your business needs to take the next step, but it is just a tool. A tremendously useful and valuable tool, yes, but useless without knowledgeable, engaged users and a solid business plan.

 

How will we help you succeed beyond implementation?

We believe CRM done right can transform your business, but we know what often happens when CRM is done wrong, or when a company chooses the wrong system for their needs.

We believe in Microsoft Dynamics 365 for Sales. We have seen what it has done for the businesses we work with, and we have seen the time, effort, and money that Microsoft has poured into improving their CRM solution over the past several years. But we understand that Dynamics 365 for Sales (and CRM in general, for that matter) is not the right fit for every business.

So when you contact us, one of our first tasks is to determine whether Dynamics is a fit for your company. If it’s not, we’ll tell you so, and recommend something that is more likely to fit your needs. We’d much rather send you to one of our partners than sell you a solution that won’t make you any money.

We also know that without proper process and training, too many implementations fail even when you choose the right CRM system.

That’s why we developed the OnTrack CRM Success System. Our OnTrack system is a structured approach to CRM adoption, training, and implementation that is guaranteed to ensure the short-term success and long-term value of your Dynamics 365 CRM system.

OnTrack is a fixed-price subscription service with a full money-back guarantee. We provide a calendar of activities, step-by-step instructions, videos, workbooks, worksheets, coaching calls, deep-dive sessions, custom add-ons and solutions, and ongoing support, all of which are the product of hundreds of successful CRM implementations over the last ten years.

And in that time, only 2 customers have ever asked for their money back. That’s right: while industry experts predict 30-70% failure rates, we’ve had 2 failed CRM implementations out of more than 300 projects.

That kind of success rate isn’t about magic. It’s about the power of proven methodology.

 

Do you want to learn more about how the OnTrack CRM Success System can help you succeed with CRM?

 

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