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Chuck Schaeffer CRM Software Selection Best and Worst Practices

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  By Chuck Schaeffer

The Best and Worst Ideas in CRM Software Selection Projects

Countless pundits have opined near countless theories about best practices related to software selection, implementation, and management of CRM systems. Based on surveys, studies, and research, there is no lack of expert opinion for those about to embark on a CRM software selection project. However, while theory and generalizations prevail, readers often seek practical and specific recommendations that they can immediately apply to their CRM initiatives. Rather than contribute more of the same to the theoretical mass, this post takes a different approach – I asked CRM software vendors for their most practical advice and best practices with the highest impact. Here's their advice from the real world.

Best Practice: Select For The Long Run But Implement For The Short Run

There was consistent feedback that the most successful adopters planned complete enterprise customer relationship management solutions but sequenced their projects into manageable phases and delivered incremental and measurable progress over time. Most adopters struggle with the amount of change management that comes with new CRM software as invariably processes and culture evolve in conjunction with the technology. Phasing the roll-out by CRM function, business unit, or geographic location provides the implementation team increased focus, manageability and predictability. The key to a successful phased project is to thoroughly understand the larger scope and to link the design and configuration decisions for each phase into the grand strategy. So don't mortgage your future and settle for a system that has near-term fit but does not provide a long term solution. Once you have selected a CRM system, begin the project by thinking about how to phase the roll-out so that you deliver early value and gain continued momentum toward the long-term destination.

Worst Practice: Buying For Features and Not Objectives

Getting enamored with bells, whistles and features you never knew existed during the software selection process is a recipe for veering off track and choosing the wrong customer relationship management application. Some CRM vendors excel at hype and lead their selling efforts with their latest new release, marketing campaign or advertising piece. Some suppliers emphasize their newest features in order to influence or change your decision making criteria in a not so subtle attempt to align with their latest product announcements. This CRM sales approach adds even more confusion and complexity to the already arduous task of selecting the optimal CRM software system which best resolves your biggest pain points, automates your customer facing business processes and aligns to your most strategic customer relationship objectives. Worse yet, force fitting new, never before considered features into an implementation effort may unnecessarily add time, risk and cost - for very little benefit. Focus your CRM software selection on the most important and prioritized criteria uncovered during your internal assessment and using measurable criteria which most directly supports your company's most strategic business objectives.

Best Practice: Understand that SaaS CRM Systems Are Different Than On-Premise CRM Systems

While software-as-a-service (SaaS) or cloud CRM applications may offer advantages in the areas of initial cost reductions, reduced implementation time, any location access, impressive uptime and outsourcing of a non-core competency to third party experts, they can also receive a cool initial reception from IT staff or users who are accustomed to client/server or legacy on-premise customer management systems. This is only natural as these legacy systems encounter no Internet latency, don't leverage web browsers for display and do not extend beyond your network's security to connect to the outside world. Software selection teams need to be prepared for cultural resistance, provide education and be able to offer measurable advantages and disadvantages for both the SaaS CRM and on-premise CRM delivery models.

Worst Practice: Automating Poor Business Processes

Let's face it – few are satisfied that their sales, marketing, and customer service business processes are optimal. Implementing new customer management software does not in and of itself improve existing business processes. The industry's best CRM systems embed an enormous number of operational best practices that you can extend to your business if you're willing to reconsider your processes. Be willing to revisit and upgrade your workflow where it makes sense to do so and resist the temptation to change the CRM software to accommodate business processes that could benefit from reengineering. Let's take opportunity management as an example. Most sales force automation (SFA) applications can systemically manage a sale opportunity through closure and embed some discipline on the sales steps and probability to close thereby improving forecast visibility and accuracy. But what if your company is like so many others that have multiple types of sale opportunities? Or what happens if sale opportunities are closed and realized over multiple periods? It rarely makes sense to force fit sale opportunities into a lowest common denominator tracking mechanism as they move through different steps of the sales process. So, use the CRM system framework to define common processes while at the same time leveraging an application that is flexible enough to accommodate your multiple types of opportunities.

Best Practice: Make Sure Your Project Team is the A Team

There are few things more important than making sure you get the right people on the CRM software selection and deployment teams. Customer relationship management provides the framework for all customer interactions and imposes a degree of process discipline on sales, marketing, and customer service staff so that business processes occur with consistency and predictability. If the customer management strategy and supporting application software are the front line for customer acquisition and retention, it warrants the design and engineering of your most talented staff. While there is also a necessary role for IT representation, whether on premise or SaaS CRM systems, executive sponsorship should normally come from the business side and the design team must be stacked with business people. Seek out people who think systemically and understand the need for process. The sales person who achieves quota every year through the depth of his client relationships may not be someone who will appreciate the need for CRM software and may therefore not be much help in process design. That's not to say we circumvent this sales person, instead we use him in a highly leveraged model where we get his input on the business practices that make him effective and embed those techniques in the CRM system for all to benefit.

Worst Practice: Demand Fixed Prices Without Fixed Requirements

Negotiating CRM software contracts is fraught with risk – paying too much, not paying for performance, not defining what is to be delivered, phasing in the user licenses as they are needed, escalating software maintenance fees in future years, adequate customer support, vague or unclear Service Level Agreements (SLAs), etc. Most CRM buyers only want to go through this procurement and negotiation exercise one time so they tend to try to lock-in a variety of contractual items in order to avoid revisiting them again later. This puts software vendors and buyers in an awkward position of attempting to lock in fixed efforts and fees to unclear, vague, variable or speculative future conditions. In the end, vendors feel compelled to protect themselves by cushioning their cost estimates to account for unknowns or lack of specificity. When it comes to pricing on-premise or SaaS CRM systems, you will achieve a better purchase and vendor partnership if you have a well-defined scope that vendors understand and that really allows attainment of specific project goals. Invest in a detailed implementation plan before making the software purchase. Make sure all investment costs are linked to the business case and timed relative to the implementation roll-out phases. Then, ensure that you clearly understand the most influential variables that result in the most significant changes to time, cost and risk. If you know your requirements extend beyond common software features, look past the mass market vendors to vertical market CRM systems or those applications that offer a greater degree of feature control through system configuration. Recognizing the timing and measurability for your specific requirements and objectives sets the stage for open and candid discussion where scope and effort are quantitatively identified and pricing risk is reduced for both parties.

Best Practice: Integrate CRM With Back Office Systems

Most SFA and CRM applications 'stop' when a sale opportunity is won. Many would argue that this is the point where the customer relationship actually begins, yet for many SFA and CRM systems this is the point where their system management ends. Surprisingly few CRM systems offer built-in quote management or sales order processing, which is a natural extension into the accounting software or back office ERP system. This lack of front-to-back office system integration further deprives customer facing staff of useful information such as credit limit, credit availability, inventory stock levels, shipping status or a view of a customers purchase history. Clients are then faced with incremental expenses to buy more "add on" software or to incur the time and cost of custom system integration. Still other CRM applications offer robust sales order management and visibility to sales history as part of their core offerings. If back office integration is a must-have requirement, ensure that the front office product you select offers flexibility in configuration and a wide range of views to your customer data so you integrate only what is essential for seamless process flows. For organizations that want to promote up-selling, cross-selling, renewal selling or just arm sales staff with customer purchase visibility, ensuring you extend the sales loop from the sale opportunity to sales order processing will be appreciated by customer facing staff and contribute to a more enthusiastic user adoption.

Worst Practice: Believe The "60 Days To Go Live" Sales Hype

Some in the cloud CRM vendor community have done a disservice to customers by setting unrealistic expectations about the amount of time and investment necessary to achieve a successful cloud CRM software deployment. Real world experience shows the time to go live follows a bell curve where an average of 60 days can be achieved in a phased approach with limited scope, however, at least one third of so called accelerated implementation projects historically take much longer. For simple software implementations, where the company has well-defined sales and support processes and does not require software customization or significant changes to software configuration, on-demand or SaaS CRM deployments can actually be live in as little as a few weeks. But remembering the bell curve, that rate of occurrence is comparable to the number of implementations consuming upward of a year to go live. Further, the go-live event is often little more than putting the software into a production state, often times without regard to accomplishment of specific company objectives. You want a software provider who can team with you in a tailored implementation project that delivers expertise where and when you need it – not where their canned acceleration approach mandates it. And most of all, you want a vendor who aligns with your sense of urgency for the project. Too many CRM vendors are quick to sell application software and slow to get engaged. Most companies agree that getting the implementation right matters far more than getting it done quickly. Set realistic expectations that are grounded in the facts and reality of your firm's operating maturity and business process complexity.

Best Practice: Demand Assured Uptime and Security

Different SaaS CRM vendors have historically achieved varying levels of system availability (uptime) and information security. Many legacy client-server vendors have ported their solutions to pseudo browser-based delivery platforms. While this technology approach may achieve some level of virtual operation in terms of delivering business software over the Web, it often fails to achieve reasonable performance and may require more IT maintenance or troubleshooting - something adopters of SaaS CRM systems are trying to eliminate. Pure-play cloud CRM vendors have built their customer management systems from the ground-up on multi-tenant architectures designed for web-based delivery. However, even among leading on-demand CRM suppliers, some products were built to maximize economy for the vendor by installing upgrades and security patches at inconvenient times and without approval or acknowledgement from customers. If you choose an on-demand CRM solution, insist upon the same or better uptime and security as you would insist from an on premise system. Verify proven assurances and financially-backed SLA guarantees which avoid system downtime or the unpleasant surprise from an audit report or a security breach. Leading SaaS vendors offer fully redundant data centers, high availability fail-over safeguards and annual independent audits to attest their business continuity preparedness.

Worst Practice: Believing That SaaS CRM Systems Administer Themselves

The set it and forget it sales suggestion that once your on-demand CRM is enabled, you relax and begin viewing color coded dashboards that summarize your sales, marketing and customer service operations is not credible. Cloud CRM systems are like any other business software applications in that they require continuous process improvement to achieve sustained business results. No on-premise or on-demand CRM system offers a self-automated response when companies are reorganized, territories are realigned, sales people are reassigned, new products are launched, business processes are reengineered or new information is needed. Similarly, as more data is loaded in your information system, you can begin to leverage powerful business intelligence (BI) tools that are built into several CRM applications to better analyze your operations, construct hypothetical models or perform simple 'what if' analysis. For example, integrated online analytical processing (OLAP) tools allow you to visually detect exceptions, spot trends and make course corrections to improve business performance. End

 

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There is consistent feedback that the most successful CRM software adopters planned complete enterprise customer relationship management solutions but staged their projects into manageable phases and delivered incremental and measurable progress over time.

 

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