CRM failure

CRM Failure – The Dirty Secret That’s Holding You Back

In my last corporate role, I ran the Australian region for one of world’s biggest CRM software companies. It was my final role in a twenty-five year career working in the technology sector. Everywhere I worked I was always a ‘true believer’ in what I was selling – you have to be, to be successful. But now, with two years under my belt on the outside of the corporate world as a management consultant, I’ve got a different perspective.

I’m seeing a common theme working with clients … CRM is a dirty word. That’s because CRM failure rates are high – as bad, if not worse, than that of ERP back in the Y2K stampede. It’s also because sales people tend not to embrace the technology (regarding it as an overhead that doesn’t directly help them sell) and management doesn’t trust the reports it generates. I remember when Siebel was all the rage… the next big thing after ERP in 2000. Tom Siebel ran his company very much with a command and control philosophy; and that was how the software worked. The results were less than ideal – massive enterprise software license deals that were implemented as ‘manage-up’ reporting tools and the majority of licenses languishing as unused shelf-ware.

CRM software has evolved since the client/server era where Siebel exploded onto the scene. Oracle acquired Siebel and have done a great job in modernizing and moving CRM into the cloud along with other leading providers including Salesforce, Microsoft, SugarCRM and many others. Cloud computing means that the vendor shares in the risk of successful deployment. This shared-risk / shared-reward business model has transformed many software segments. If you want a CRM initiative to be successful, I’ve got some important rules to follow, but first, why does CRM fail and where are the risks in implementation? How do you overcome the negativity and also secure the right level of funding from the CEO?

I’m not a CRM basher. I passionately believe that you have absolutely no chance of being customer-centric and creating a single source of the truth about prospects and customers without one. CRM software is the best platform to manage customer life-cycle and automate customer processes – every business should have one, but no more than one.

But here is the first big problem. The term, Customer Relationship Management has been hijacked by CRM software technology and success or failure has little to do with the tech and everything to do with how it’s implemented. Customer Relationship Management should be a strategy, then a process, then a suite of enabling technologies that place customers at the heart of everything you do.

Dr Michael Hammer coined the term, ‘business process re-engineering’, and he says: “The technology stuff is the easy stuff.” He researched why ERP implementations failed but that’s a topic for another time. Selecting the wrong CRM technology guarantees failure but choosing the right products and solutions does not guarantee success – change management is key. Here are the main reasons CRM implementations fail:

  • Failure to define your customer experience strategy
  • Failure to design with sales, service and support staff being the primary internal ‘customers’ and users
  • Failure to integrate social selling and marketing automation
  • Failure to embed sales methodology and sales process.
  • Failure to configure to be a deal management and sales coaching platform.
  • Failure to integrate as the single source of truth for the entire customer lifecycle

The antithesis of this list obviously gets you on the path to CRM success but how do you secure the essential support of the CEO for the right level of funding and executive commitment? You must be able to answer his or her three big questions: 1) What is this about? 2) Why is it important? 3) What will this do for us? In talking with my clients, here are my recommendations for framing the conversation with the board, CEO, or executive leadership team.

Never use the term 'CRM'. Instead talk about ‘customer experience’, ‘customer lifecycle’, and ‘single source of the truth’. Executives understand these three terms and like them.

Focus on customer relationship management as a strategy and then a process. Define a sales methodology that drives your specific sales process so that reps can be coached to ensure that tactics and actions are linked to strategy. This approach delivers best practice and accountability in the sales team.

It’s important because it costs up to five times more to acquire a new customer than to upsell an existing one, and increasing customer value (upsell) is the best retention strategy. Yet placing customers at the heart of a business is just a cliche for most who allow finance systems to reign supreme. To be customer-centric you must have an effective CRM strategy supported by the right (Customer Relationship Management) system.

In response to the question of, what will it do for us? ‘It will help us to be customer-centric, grow revenues, reduce customer churn, improve renewals, enable better sales execution, create transparency in pipeline and deal coaching, and improve forecasting accuracy and revenue predictability; and it will provide us with a single source of the truth with a 360 degree view of the customer to support the entire customer lifecycle across all departments interacting with and supporting clients. Now what kind of ‘asleep at the wheel’ manager wouldn't want these things?

If you’re leading a CRM initiative, remember that it must be implemented to serve users rather than as a database for management. CRM should be a strategy and a process, rather than a product and reporting tool. The system should be designed to enable customer experience and support the entire customer lifecycle. The best CRM implementations therefore incorporate sales methodology integrated within an organization's specific sales process so that reps can be coached to ensure that tactics and actions are linked to strategy. This approach delivers best practice and accountability in the sales team. Importantly, ensure you measure the right things – you can't manage revenue in CRM.

Constantly ask the right questions. How can we make ourselves customer-centric and enable our sales and support people to be more efficient and effective? Does this place our customers at the heart of everything we do? When selecting CRM technology, here are some considerations for sorting the wheat from the chaff.

Select software technologies that are easy to use and also offer flexibility for cloud deployment, include strong process workflow, integrate easily and affordably with social media platforms (LinkedIn, etc.), marketing automation and finance systems; include mobility capabilities and integrate with collaboration, enabling you to maintain control of your data. Implementation services also need to be from an expert who understands how to link features and functions to business value to drive increased revenue and reduced costs.

Most importantly, the implemented CRM should serve the users and improve sales productivity by enabling sales processes and deal coaching. This instead of being an imposition on them or merely serving as a database reporting tool. Finally, it must be easy to use and provide a single 360 degree view of each customer (integrated with marketing, finance and other systems) to support the entire customer lifecycle.

So, don't let CRM failure be a dirty secret; make it a risk that needs to be managed. Ensure the proper level of investment and executive commitment rather than mere support.

Dave Stein from ES Research has great insights concerning CRM success and here is a two minute clip from an interview he did with me for Sales and Marketing Management Magazine.

If you valued this article, please hit the ‘like' and ‘share’ buttons below. This article was originally published in LinkedIn here where you can comment. Also follow the award winning LinkedIn blog here or visit Tony’s leadership blog at his keynote speaker website:

Main Image Photo by Flickr: Jordi Sanchez Teruel

Sales Transformation – Don't Do Software Trials!


The most difficult part of an enterprise to transform is the sales organization. Many leaders see their revenue machine as a mystery black box filled with a little bit of science and a lot of art. On this, the allure of sales and marketing software tools (CRM, Methodology Playbooks, LinkedIn Sales Navigator, and social selling platforms) promise to bring increased reach, accelerated results, buyer alignment, consistency in sales execution, transparent pipeline creation, timely opportunity progression and predicable forecasting.

Yet the failure rate of software projects is alarming. ERP implementations fueled by Y2K fears back at the turn of the century had failure rates of 40% (source: Dr Michael Hammer). Hot on the heels of the ERP craze (Enterprise Resource Planning – eg; SAP and Oracle enterprise management systems) was CRM (Customer Relationship Management – eg; Salesforce, Siebel, Oracle, Sugar, Dynamics, etc.) and the statistics are sobering:

  • 73% of companies do not have high confidence in their CRM data. Source: Miller Heiman Research Institute, 2014 Sales Best Practices Study which is an ongoing program with >30,000 participants over 11 years.

  • Up to 70% of CRMs fail in the USA according to Gartner Research in 2012 and they stated that they did not anticipate any improvement through to 2015.

  • 70% of CRMs fail in Europe according to Butler Research and published by Dun and Bradstreet infographic 2013.

I think the failure rates of CRM today are approximately 30% - 40% today based on anecdotal and 'show of hands' surveys when I speak at conferences. But does this mean we should avoid implementing CRM and other sales transformation technologies? ABSOLUTELY NOT!

"You have no chance of being customer-centric and driving effecieint process to create best customer experience unless you have a brilliant CRM"

You also have no chance of improving sales success without embracing social selling, especially LinkedIn's platform.

Every leader knows that they must drive transformational change. I've been preaching for years that "the way we sell is more important than what we sell" and our ability to leverage technology and create superb customer experience is the biggest point of difference as we go to market.

Using technology and people to create sensational customer experience is the key to dealing with the forces of disruption and commoditization. The best leaders and sales people embrace technology and social platforms to remain relevant and prosper in competitive markets. But how do you manage the implementation risk of CRM, Sales Navigator, Playbook methodologies or social selling tools?

I've been the regional leader for a CRM technology provider and I've also been on the other side as sales Director for a public corporation implementing CRM and LinkedIn. I now work with clients helpingthem navigate the risks in achieving the outcomes they need from investing. Ironically, I see many increasing their risk by sending the message that they are uncommitted in driving the necessary change; and they do so with ill-conceived trials and pilots.

"Doing software trials with sales people is like hitting them on the head with a hammer and then asking them what they think"

The stakes are high in any change management program and that's exactly what's being done when implementing LinkedIn's Sales Navigator, CRM, Playbooks, qualification methodologies or opportunity management tools. Success is not an option when you consider the fact that B2B sellers have somewhere between 40% (Corporate Executive Board research) to almost 70% (TAS Group) of their sales people failing to achieve their revenue numbers!

Here is my candid advice for anyone considering the implementation of CRM or LinkedIn's Sales Navigator.

  • It must be a strategy and process before being about technology.Be crystal clear about what it is you're automating or seeking to enable. CRM, SFA (Sales Force Automation) and Social Selling must be designed for internal and external users including staff, partners and customers.

  • It's a change management program rather than a technology implementation. You're seeking to bring people, process and technology together for transparency and better execution. Bring people along with you on the journey and lead with why it's important before communicating the detail of what, when and how.
  • Don't send mixed messages to your sales people or the inmates will continue to run the asylum. Be committed and don't 'play' with software, process or methodology to see what people think. Do your homework, prepare, plan and fully resource for success. The power of Sales Navigator is in the network effects of having everyone using the platform. The power of CRM is having it used by everyone as the single source of truth about clients.
  • Forget having an 'executive sponsor', you need executive commitment. The leaders of the enterprise must fully understand and use the tools themselves. Everyone should transform their LinkedIn profile away from being an online CV to instead be a personal brand micro-site in harmony with the employer. If a sales person wants resources for opportunity pursuit... the deal must be up to date and well qualified for an approval to be granted. Any time a senior executive is asked to talk with or visit a client, the call plan must be there in CRM.
  • Measure the right things and carefully select the best KPIs.Interestingly, only 17% of metrics being reported in CRM systems can actually be managed.Source: Cracking The Sales Management Code by Jason Jordan and Michelle Vazzana.
"SSI is the new KPI for stategic selling"

Click here to get your LinkedIn SSI score now with links explaining how your score is calculated by LinkedIn


Independent researcher C9 Incsurveyed 36 companies and 9,000 sellers, finding that those who embraced LinkedIn's Sales Navigator tool created 7 times more pipeline and 11 times more revenue. LinkedIn themselves analyzed a cross section of new and existing sellers who increased pipeline by 45% and the probability of achieving their sales targets by 51% simply by improving their social selling index (SSI) scores.

For LinkedIn Sales Navigator or any other sales enablement technology; build your business case, understand user experience, be clear about the problem your solving and the results you expect. Carefully design and communicate KPIs and then drive change with committed leadership. If your considering LinkedIn's Sales Navigator, deploy to the entire organization just like many others have done to realize the network. See case studies here. Avoiddoing small pilots because they achieve nothing but damage momentum and the probability of success.

"The risk is not in the technology, it is in your ability to lead and manage change within your sales team"

If you valued this article, please hit the ‘like' and ‘share’ buttons below. This article was originally published in LinkedIn here where you can comment. Also follow the award winning LinkedIn blog here or visit Tony’s leadership blog at his keynote speaker

Main image photo from Flickr.