CRM Projects Fail Because Users Say “No Thanks”

Nearly one-third of customer relationship management (CRM) software deployments end in failure, according to new research from AMR Research Inc.

The bottom line is that sales representatives and, to a lesser extent, marketing professionals, just aren’t using the technology, and that nonadoption is leading to failure.

The Boston-based research firm recently surveyed 190 IT and line-of-business executives and found that 29% of CRM projects fail. That’s slightly better than the 31% failure rate AMR Research uncovered in 2006, but it’s much worse than the 18% rate discovered in 2005.


Last June Cambridge, Mass.-based Forrester Research Inc. reported that less than 50% of the 94 business and IT executives it surveyed were fully satisfied with their CRM deployments. When Forrester asked those executives to list their best practices for improving their CRM implementation, 66% said promoting user adoption was a top priority.

AMR Senior Research Analyst Robert Bois said that sales and marketing professionals reject CRM mainly because it’s just not easy to use.

“That’s all relative,” Bois said. “What you and I might think of as a fairly simple user interface might not seem as simple to a salesperson who spends as much time as possible on the phone with customers and doesn’t have time to be fooling around with a piece of software.”

Bois said sales representatives also reject CRM because it just doesn’t offer any value to them. CRM and sales force automation systems will ask sales representatives to enter a lot of data, but the technology doesn’t always help them do their jobs better. Instead, much of the data they enter into these systems offers value to only managers who are trying to track and forecast sales activity.

“CRM and sales force automation as discrete software categories were initially designed to appeal to sales management, not the sales user,” Bois said.

Jim Prevo, CIO of Green Mountain Coffee Roasters Inc., said poor user adoption is a symptom of a problem, not the root cause of CRM failure.

“You need to have enough value in the system for end users to make it irresistible for them to use it,” Prevo said. “If you put in a system that is primarily about monitoring their behavior rather than putting in a tool that is about maximizing their behavior, they are not going to see those tools as absolutely essential. Once you do that, you’ll get adoption. And adoption is critical.”

Bois said the CRM market is reacting to this problem by shifting its approach to offer more value to the end user.

“The most common thing you’ll see is they’re starting to put performance metrics in so the salesperson knows how they’re performing against their quota. ‘If I’m gong to close this deal in the next 30 days, what would that mean for my quota?’ Ultimately, it is giving them better visibility into their ability to meet their quota.”

Bois said some vendors are also offering applications such as proposal management for more complex sales cycles. These technologies use a wizard-like interface to ask basic information about sales prospects. Then, in conjunction with marketing, the application creates an automated custom proposal to help them attract the prospect.

Bois said CIOs need to get sales executives more involved in the procurement of CRM technology. And CIOs should resist just accepting the latest CRM offering from their ERP vendors. Instead, they should try a third party for this technology. In fact, they should consider letting the sales executive take the lead. This isn’t such a hard thing to do with the emergence of Software as a Service vendors such as Salesforce.com. The sales executive knows his staff better than the CIO does. The CIO can take on a more consultative role to make sure the implementation and any necessary system and data integration go smoothly.

Quote from http://crmweblog.crmmastery.com/?p=950
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