Why So Many CRM Systems Fail

“To gain enthusiastic compliance, a system should provide the user with 3x the information and utility that they personally put into the system.”

In the mid to late ’90s, Customer Relationship Management (CRM) and Sales Force Automation (SFA) applications were the rage. Companies like Siebel, Clarify, and Vantive sold thousands of applications to willing executive buyers. Salesforce.com then went down the same path with incredible success and continues that onward march, seemingly for the next decade. Yet ..when you have the opportunity to dig deeper into the sales process (even if from the Pre-Sales Engineer side) at hundreds of companies, there is massive room for improvement.

The #1 complaint for the last twenty-five years? Too much shelfware. Rarely does the application meet its promises, users (especially salespeople) offer minimal data entry compliance, and executives never really gain faster and better insights into their pipeline or customer satisfaction. The not-so-secret cause was that users didn’t feel they gained sufficient value back from the system in return for the data (and time) they invested. The amount of wasted capability, licenses, and monthly spending are staggering and shameful.

( Scary Fact: A few years ago Harvard Business Review reported that around 90% of executives say that CRM is NOT helping their business to grow)

In 1997 I came up with the 3:1 rule and started sharing it with clients. It switched the implementation focus from data entry and process compliance to answering the “What’s In It For Me?” question the users (aka salespeople) always asked. For example, we had a customer whose SFA installation was limping along – in dire need of a helping hand. The biggest complaint of the sales and sales engineering team at the time was that it was a “pure” sales system – so no one outside of the sales force was using the application. So we at once suggested that they add legal, finance, revenue recognition, and product management into the sales process and made them accountable for their part of the approval process. Suddenly sales got more out of the system than they entered, and the system took off and became a major hit.

        "There is no such thing as the perfect sales process"        

I see the same thing happening today with other sales processes and sales engineering systems. My biggest question is always, “what do the users get out of this in return?” There is no such thing as the perfect sales process. Companies spend millions of dollars/pounds/euros searching for this elusive unicorn. What matters is that you choose one that is good enough and then commit to it. That provides discipline, repeatability, and valuable data which can turn into wisdom and knowledge. Maybe it will help you focus more on the buying process rather than your selling process.

So ask yourself – what do the sales and sales engineering team get out of the CRM system – and what incentives are there for more than basic compliance? For sales, it means finding a way to remove friction from the pipeline, progress deals faster, and find the right people and solutions to apply to each qualified opportunity. It is the same thing for the SE community – how to optimize their time to maximize revenue and customer satisfaction with minimal effort. ?

When was the last time someone got excited about entering data into their salesforce instance? Can you genuinely point to a set of deals you won because your sales process was better than your competition?

Three to One. What are your three??Let me know in the comments..