Question: I bought the Deluxe Ab Assassin two months ago and have used it every day since then.  But I still can’t see my toes.  Why don’t I look like the ripped model in the ad? 

Answer: Because the model is not on a first name basis with the Krispy Kreme counter lady. 

Like a sophisticated exercise machine, customer relationship management (CRM) software is only one piece of the “sales fitness” equation. The healthiest people have the best habits, not necessarily the most expensive equipment.  But hope persists and CRM continues to suffer the highest failure rate of any enterprise software.  Why?  To answer this question we need to consider the original ideas behind the technology and explore some mundane but critical implementation constraints.   

The Promise 

Back in the old days, business-to-business selling meant establishing and nurturing a personal relationship between your sales rep (usually in the field) and a buyer or other decision maker in the customer’s organization.  But increasing margin pressure, more sophisticated inventory management practices, proliferating logistics options and the emergence of new sales channels turned this cozy world upside down.  To quote the title of a famous 2003 Harvard Business Review article, “The Customer Has Escaped” from the one-size-fits-all sales model.  Sophisticated buyers have powerful new sourcing tools and are no longer willing to pay for services they don’t need.  Relationships alone are no longer enough.   

CRM was created to address these challenges.  It promised to help companies become “customer centric” organizations that could quickly identify and respond to changing needs.  The software would provide a seamless view of each customer, tracking all interactions whether in person, over the phone or via the website.  By collecting and analyzing this information, CRM would help a company segment its customers, allowing it to fine-tune pricing and service levels, thus maximizing profitability.   At a tactical level, the software would drive corporate priorities, such as major leads or marketing campaigns, into daily sales activities through integrated reporting and workflow tools.   
 

The Reality 

All this crunching and routing of customer data is certainly impressive.  Unfortunately though, the most powerful bits of information do not reside in any computer system.  They lie firmly between the ears of the sales rep (or maybe on scraps of paper in his glove box).  The type of customer data that is computerized is mostly transactional in nature, because this is what the legacy business systems require to process orders.  It’s easy to extract a customer billing address or number of web page visits, but next to impossible to find the owner’s personal buying triggers or a competitor’s share of their purchases.    

The technologists’ solution is to get the sales force to feed the system.  Executives quickly agree because they consider data centralization to be an important benefit of the CRM project; a way for the company to claim its proper ownership over the customer relationship.  But this approach usually leads to reactions ranging from subtle sabotage to outright insurrection by the sales force.  They object to the data entry time, which eats into precious customer facing activities. Less legitimately, they also fear that divulging critical customer information will make them easier to replace and threaten their commissions by opening their accounts up to alternative channels.  Finally, the CRM screens often seem purposely designed to irritate the less-than-computer-savvy sales rep, with their convoluted screen navigation, geeky nomenclature and functional overkill.  At best, a rep gets a pretty color chart that summarizes all his manually entered data and provides little new insight.   

The net result is a vicious cycle.  Reps don’t use the new system because the data is incomplete, so it’s easier to continue working with the old data sources, such as the enterprise resource planning (ERP) system, personal contact lists or paper records.  As long as everyone continues working with the old files, the new CRM system doesn’t get updated, the data inadequacy continues and the vicious cycle is perpetuated.   
 

The Tragedy 

Assuming you manage to overcome these obstacles, another trap awaits in the flow of data between different systems.  In purely technical terms, it is now relatively easy for top tier CRM packages to interface with the more common ERP, email and contact management systems.  However, the business processes for managing these data flows are very thorny and rarely well thought out.  For example, what happens when a new lead is closed and becomes an actual order?  If the lead is downloaded from the CRM system into the ERP system you will end up replicating the order entry function on the CRM system, which lacks product, price, credit and inventory information.  Keying it directly into the ERP means double entry and no easy way to ensure that the CRM is updated to reflect the lead “win.”  There is generally no way to tie the lead reference number on the CRM with the order number on the ERP.   

These kinds of data landmines litter the CRM landscape.  For every data element that flows between systems, clear rules must be established as to who is allowed to enter and update it, how it is validated, how it propagates to different systems and what happens when there is a version conflict.  Failure to pay close attention to these issues can be worse than an ineffective implementation: it can jeopardize the integrity of the data needed to run the business.   
 

The Hope 

So, how do you ensure that your CRM implementation is one of the 30% that actually succeed?  For a start, recognize that sales performance improvement is not about technology.  Most companies make the fundamental mistake of starting with a software selection decision (aka a vendor bake-off) and treating sales processes as a mere “configuration” issue.  This is precisely backwards.  Modern CRM packages have more functionality than most companies will ever be able to discover, much less use on a daily basis.  There may be functional differentiators that are relevant to a specific company, but they can’t be identified until after sales processes have been clearly defined.  The real challenge is developing effective sales practices, not selecting software features.   

The following guidelines will greatly improve your chances of success:

• Strategy and structure.  Before even investigating CRM you should verify that you have a clear sales strategy and that your sales force structure is aligned with it.  Strategic sales issues are chronically mis-diagnosed.  Tactical solutions, such as fixing the pay plan, sending everyone out for more training or throwing money at technology won’t work if the sales force is fundamentally misaligned.  If every rep can’t recite your strategy in his sleep, fix this first.   
• Process first, automation second.  Automating dumb things just enables you to do dumb things faster.  If selling is still a craft in your company, rather than a set of defined processes, your CRM prospects are bleak.  Start with a Sales Effectiveness Process to establish best practices in time management, account targeting, pipeline management, territory reviews, etc.  Once the processes are right, you will find that a little automation goes a long way. 
• Bottom up, not top down.  Everyone except a wet baby resists change.  Your sales force will be especially leery of any sales management system and may suspect that it is nothing more than computer-enhanced micro-management.  To mitigate this risk, create a project team comprised primarily of sales reps and managers, rather than the usual techies.  Think about assigning the most vocal CRM critic in your company to the team and challenging him to come up with solutions instead of just problems.  Consider sales force buy-in and ownership to be the single more critical factor in success of a CRM implementation. 
• Give more than you take.  Start by implementing the functionality that is most important to the daily users of the CRM system.  Sell it as a tool to make their lives easier rather than a new rulebook that demands compliance.  Reps will find things like scorecards (everyone wants to know how they are doing); call budgeting tools (not call reports!); target account growth data; and online information libraries to be truly useful.  As usage expands and deepens, the data to support market analysis and other corporate objectives will build up naturally.  
• Executive commitment. A visible, consistent and long-term commitment by senior executives is essential.  The entire company must be convinced that there is no turning back and that the CRM is not just the latest gimmick, to be superseded next year by another new program.  

We’d all like to get back in shape for $69.99 plus shipping.  It’s just as tempting to hope that a $50,000 software license fee will bring our sales force into the 21^st Century.  Unfortunately, modern equipment alone will not win this game.  The evolution of sales from a personal relationship craft to repeatable, scalable and strategically aligned processes requires modern management techniques, not more donuts.   
 

Steve Deist ( This e-mail address is being protected from spam bots, you need JavaScript enabled to view it ) is a sales management specialist at the Indian River Consulting Group. IRCG is an experienced based firm specializing in sales execution and marketing channel optimization. Started in 1987 by J. Michael Marks, IRCG has specialists who consult with distributors and suppliers to make the changes necessary to maintain competitive advantage. You can contact them by calling 321-956-8617, or visit www.ircg.com for more information.