Customer Relationship Management (CRM)

The top 4 reasons why CRM systems fail

By Lukas Szczurowski

It is often assumed that a CRM system goes hand in hand with stimulating growth and achieving success. This explains precisely why billions of companies world-wide have sought after finding a CRM solution that’s right for their business. However, according to noted research institute, Gartner Inc., anywhere between 50-80% of CRM implementations fail.

In order to approach this overwhelming statistic, I once again looked to LinkedIn to gain some insight on people’s personal experiences with CRM and why they believe it can fail. In culmination with their thoughts, this blog will highlight the top 4 reasons why over half of CRM adoptions fall short. My hope is that this blog inspires and educates people on how to make CRM an achievement and not a disappointment.

1. Distinguish between a WANT and a NEED

Our last blog addressed how crucial it is for companies to critically assess their requirements and needs before beginning their research on CRM systems. This helps to truly define where the CRM comes into play and what key functionalities companies should look out for. However, many companies are quick to assume that they “need” a CRM solution simply because their industry peers or competitors have one. In other words, these companies don’t understand the true need for the system and instead are jumping on the bandwagon for the sake of wanting to stay up to date.

Being able to distinguish between your want vs. your need for a CRM is half the battle and will ensure that you adopt a system that coincides with your company’s requirements and will therefore be easily picked up by your sales people. Not understanding your needs and not knowing what the CRM is purposed to do will result in the CRM failing at an alarming rate.

2. Management can’t simply buy CRM; they need to buy-into it

The second most common reason why CRM systems fail is because there is a lack of buy-in, especially from management. CRM needs to become part of the company culture and in order to do so, everyone in the organization needs to not only have faith in it but also USE it. On some occasions, the management team quickly adopts a new CRM system for the sake that they recognize a need for it and see the value for their sales team. However, in order for the system to truly have an impact on the organization as a whole, management needs to support and use the system themselves and thus contribute to marking its role within the company.

Top-down support for the CRM initiative has to be present for the adoption to be smooth and successful. Management needs to believe in the CRM and support its benefit to the company, which cannot be accomplished without their unconditional buy-in.

3. Inadequate Training

Another common reason contributing to the high statistic of CRM failure is simply because the users are not trained well enough. Let it be because they didn’t ask the right questions or because they are not technologically-saavy, if the user doesn’t know how to use the system, it is inevitably doomed for failure.

It is crucial for all users to actively take part in becoming an expert with the CRM solution. They need to ensure that their list of needs matches up with the software’s functionality and that they know how to optimize on those features. However, none of this can be accomplished if their CRM vendor does not take the time to efficiently train the users. It is common for people to require far more support and nurturing than training personnel might assume. With that being said, apart from the system’s features, companies should sufficiently research what type and level of support the vendor will provide them with throughout the adoption. Knowing this in advance will help to minimize the risk of lack of use and ultimately, failure.

4. You can’t teach an old dog new tricks

The fourth most common reason for CRM failure is a result of the salespeople not wanting to adopt the system. Once they develop a routine, salespeople are reluctant to adopt new things, especially technology. The issue than steers clears of being a system issue and instead is a result of a people problem. Having the attitude “that’s not the way we like to do things” can cause the CRM system to fail before it even goes live.

Salespeople need to not only be fully informed about the system’s functions and capabilities, but as well its benefits in order for them to understand the value that a CRM solution can provide. They need to see that the CRM is not purposed to change the way they do things, but rather to enhance and simplify things. It is also crucial for the salepeople to be actively involved during the adoption process and provide their feedback so that they see the benefit of implementing the CRM system into their daily routine.

I hope that by outlining the top 4 reasons why CRM systems fail, it will assist companies with not only finding the ideal CRM product for their company but also how to go about gaining support from every member of the organization prior to adopting a solution. If requirements are clear and concise, support is unconditional and training is of great importance, the implementation of a new CRM system should prove to be successful and not detrimental.

About the Author
Lukas Szczurowski is the CEO of Luxor CRM, a web-based CRM vendor, headquartered in Toronto, Canada.

Tags: Customer Relationship Management, online crm, saas crm, web-based crm, Sales, Leads, toronto crm

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