Before anyone gets any chuckles about how long it has been since my last confession... uh, I meant my last post... it should be noted that the demand for CRM is completely off the charts and we are enjoying our best years ever.
Some people speculate that it's chic to be into your customers or be wrapped all around social media but in reality executives are understanding that need to maximize their labor assets and differentiate. And, when people get around all of the rah, rah and "Big Brother" aspects of CRM, when done correctly, it actually makes a difference.
Now that I have two seconds to stop in between customer visits and strategizing on how my internal team gets better I thought it a great time to make a commitment to getting back to my blogging activity. And what better to talk about than marketing automation.
For those not aware there has been an evolution going on for some time to make a more meaningful bridge between electronic marketing and CRM that is having a much bigger impact than anything I have seen in the past 15 years.
The challenge has always been a kind of chicken and the egg approach to the tradeoffs between marketing and sales and disconnects that always occur. Enter the world of "MA", or marketing automation, and the new realities that this opportunity brings.
In order to really understand the dynamics off marketing automation one really needs to revert all the way back to the way sales and sales engagements have evolved. Back in the day the vendors controlled everything from the sales process to the flow of information.
Today’s world of sales is much, much different and there is a level of control that has been given up to the customer in the age of the Internet. There is more information readily available for consumption and sales teams are trying to figure out where they fit into the customers’ buying process.
As stated in one of the keynotes at a conference I attended today the new world of selling is all about understanding and connecting all of the interactions and putting that in the context of your history and all of your relevant data...
This, my friends, is what many of us having been looking for since getting into the CRM business. We finally have a path to fuel the CRM system and power the right investments into the marketing that will put the right customers at the other end of the sales funnel.
One of the most interesting circumstances that we see in the CRM industry is the level of flexibility in our customer’s project teams and the fluidity of the user constituency in changing objectives and priorities for their CRM projects. There are many causes of this phenomenon and we will discuss a few of them here. More importantly, I will highlight the newest CRM "toys" and give my opinion on those most relevant to the business climate today.
Before we get into which toys and why it's probably just as important for consulting and internal project teams to understand why technology is evolving so quickly in this industry. There is no doubt that capital investment from software publishers and SaaS players, coupled with an explosion of accessibility methods and devices, has been the driver here. Add in the fact that there is now a blend between the personal and business aspects of the social space and now you have essentially the perfect storm for CRM innovation.
As many people know I prefer not to get into product specifics as I have to during countless boardroom sessions but I think it's fair to mention that its not just the CRM providers that are making strides but the ancillary offerings that are also pacing the innovation. With robust market places and constant messaging more and more companies have gone away from concentrating on core business drivers and are focusing on how to "adapt" the newest app or gadget to CRM because they bought in that somehow it equates to competitive advantage.
Let’s dive into five hot capabilities in CRM and give you the skinny on how and where they fit.
Social "Anything" - Just look at almost anything related to CRM and you will see the word social attached to it. This concept is certainly harder for a B2B environment to pull off and the closer you are to dealing with individuals and consumers this has actual value to you. For those in recruiting, consumer goods, fund raising, and retail you have a winner. If you are in another industry and having a hard time visualizing how it applies maybe cool your jets and wait to see a practical application in your industry.
Reputation Management - This capability is also evolving from the "social" sphere and is also labeled social media monitoring. This function can (but does not necessarily) relate to both B2C and B2B but the practical application is probably more in areas where there is heavy investment in brand and where products or services are highly transactional. So if you have a product in grocery stores or retail then it applies but if you are a regional general contractor or technology reseller not so much.
Collaboration - So far we have seen two sides of the coin on this one. There is definite value depending on the situation. If you have a complex, distributed or team selling approach then connecting with team members and sharing intelligence or making split second decisions has value. If you run field sales and service operations there can also be a nice tie in for people to communicate at the central point of concern and resolve customer issues or strategize on managing relationships. If, however, your shop is all about talking and analysis through paralysis some managers have complained that collaboration is just another productivity killer so you have to set rules and boundaries.
Portals - Watch more discussion about portals as one of the catch phrases that will continue to evolve in 2013. The general idea of portals, ecosystems and communities is that there are centralized places for people to work with each other and produce synergies around a common set of objectives. The drawback is that if you can't readily layout a structure and are "pushing" to define a solution you may not be the best candidate.
Mobile - Now here is the real value add in terms of new capabilities that really matter. We have finally come to the point where information should be available anywhere and anytime so that users can consume at a time and place that makes a difference in their ability to produce either revenue or results. We live in a society where everything happens in Internet speed. If we can’t transact the same way that our users or customers expect then they are at risk of finding someone who can. The only caution is that users should temper expectations of pushing full functionality of any desktop system into a mobile experience. The key driver here is the concept of BYOD (Bring Your Own Device).
So, as you head into the Holiday Season and start to eat your body weight in goodies and look at lots of shiny new toys, don’t forget that there is a difference between marketing hype and practical application of technology in your business. If you don’t know how something will fit that a vendor is pushing really hard then just wait until you have a solid business case for deploying new capabilities.
One of the biggest problems that have existed in the world of CRM projects since the day I started working with these technologies is the concept that Customer Relationship Management will “make” sales people better. I would argue that in a best case scenario a properly designed system will expose poor hiring choices. Don’t get me wrong….there is a lot of sales enablement but a CRM system will not change the DNA or the mentality of the person sitting between the chair and the keyboard.
Being stuck in the bowels of internal sales operations for hundreds of companies for the past couple of decades there are usually several “control” issues that will come up and need to be hashed through if a system ever has a shot at getting the proper buy in. If you are a sales manager then you probably already know that your CRM is only as good as your worst user. If you are team selling or have multiple departments dependent upon each other inthe system the problem is much worse.
Before we talk about the ways to address some of the every day issues with technology used by business development people I think we should document what I believe to be some truths about most (not all) sales structures and sales personnel:
Numbers, numbers, and numbers – No one ever got pulled into their boss’s office and was told that they had horrible sales numbers but was getting to stay because they were a mast of the CRM system. At the end of the day production is the scorecard and CRM vendors should keep this in mind during design, implementation,and for ongoing support.
CRM is Infrastructure – More than ever before what CRM provides is the ability to put structure and process around business development. It also enables the rest of the organization (marketing, research and development, operations) to have a “landing place” for critical data to be sourced as needed in order to land more revenue.
Art or Science – Being the son of someone who sold for 35 years I understand the statement that sales people are “born” and not made. I have also taken a number of people over the years and turned people that you would not call sales people into very productive business development people. At this point all I will say is that there are both types that are successful and as a sales manager there is a need to understand what people need to keep them successful.
It’s Business Not Personal – Sales is one of the hardest professions and the people that are successful quickly understand that most sales people are not.There is a lot of ego in sales organizations and there is a fair amount of distrust of management. No matter what you “intended” for your CRM implementation the word on the street from your sales team is probably a much different perception.
Count on Change – However you sell what you sell today it will be different six months from now, next year and the year after that. The keys to successful businesses are the way they adapt to the changing landscape in the marketplace. If you think about this in the way that you design and use your customer facing systems you will create a flexible environment that adapts to the need of the organization over time.
When you go back to the title of this post I hope that you can see why I don’t think a piece of technology can “make” people better. It won’t take away their laziness, insubordination, bending all of your rules, or make them double or triple their numbers. There is no piece of technology that provides a burning desire and the will to succeed.
The problem as CRM implementers is that many times someone pulls the trigger on a project thinking that CRM will somehow do some or all of these things. Bad news…people are people….and until they can invent a machine that other people like to buy from they are the best option we have. Understand that a system that eliminates tedious reporting and provides relevant data without sourcing other people in your organization will createmore selling time.
And, at the end of the day, if you have good products and services that are pitched by sincere and ethical sales people, you will add more top line and bottom line results.
Now the holidays are gone and we have come to the close of another business cycle. It is particularly interesting that there are many new planning sessions going on and people are recounting what has gone right and what has gone wrong and some will even come up with a list of things they will do differently. The reality is that most people might make a few small adjustments but for the most part next year‘s efforts and results will be within a stone’s throw of this year.
What I just wrote can either be potentially sobering or uplifting or neither. So why did I write it? Truthfully, it needed to be said. And why did it need to be said? Hopefully, because someone will read this blog and understand that the way to exponential change is not through incremental thinking. If you want next year to be significantly different then spend the next two weeks ripping through every process you have and question everything that you do and question everyone else on their processes and ask them why they do things a certain way.
The best part of working in the world of CRM and the worst part of working in the world of CRM is the lack of rules and the stringent structure in other business applications. If you approach CRM with the knowledge that everything is up for change then you might have a fighting chance to make this year a game changer. How in the world would you do that? Rather than ranting about process, process, process and change management and twenty other buzz words I will simply start my blog this year with a simple survey that you take as a self assessment to find out whether you will land within a rock's throw of last year's numbers or if you will, in fact, look back at 2010 and say, "Why in the hell didn't we do this sooner?"
1. When was the last time you had a group of your customers sit down in a room together with the "gloves off" to give you a real picture of how they see your organization and just sit and listen to their opinion of the customer experience?
2. Better yet, when was the last time you invited in a group of customers that fired you in the last couple of years to do the same thing?
3. Have you ever taken the approach to manage the different customer "buying processes" rather than trying to figure out the magic pill to the optimal "sales process"?
4. If you locked your top 10 producers in a room and told them that they were only going to be comped if their revenue split between new accounts and existing accounts was 50/50 this year how would they react?
5. Have you actually taken an inventory of how people actually spend their week and then worked backwards through what it would take to remove all of the non-value added activities to worry about only getting them in front of customers and prospects?
6. Did you ever evaluate your bottom 10 percent of your installed base customers and consider firing them based on the lack of profitability to your firm?
7. Do you know exactly how your marketing efforts track back to sales and are you willing to cut certain marketing efforts and put money into others midstream rather than just sinking money into these efforts until their conclusion?
8. Can you identify the deals in your pipeline when they turn against you and decide whether or not you need to bail out or do something drastic to try and change the outcome?
9. Are your producers spending way too much time being overpaid lead qualifiers or do they have a list of target accounts that match the profile of your most profitable customers?
10. The best for last. Will you simply read this blog and go back to your same old routines and reach the same results or will you do something drastically different this year to reach your goals?
Ten years ago when you walked in a room with a projector the size of some small refrigerators and sat down to show a CRM package all everyone wanted to know was “Do you have a sales funnel?” Throw it up on the screen and your CRM package was half way sold. Now we have come full circle and when we sit down with prospects the projector barely comes into focus before the “D Word” comes out. I am not saying that dashboards are bad, but them in context of the bigger picture.
If you start to break down the concept of Dashboards and their purpose then you must also define what a dashboard is versus other components of Business Intelligence. In simple terms Business Intelligence or “Smart Data” is any subset of information provided in a way that accelerates decision making or management of a business.
The traditional methods of Business Intelligence for CRM purposes can be broken down into a few simple buckets. This first category is what I call Informational (like a gauge in your car). The better format is using Key Performance Indicators (KPI’s are have intelligence already built in). And the final category is what I would call Status Indicators (more like the lights that come on in your car when something is wrong).
Like the sales funnel from days gone by the Informational dashboards are cool to look at and they do provide some demographic information like your lead/close breakdown or the different categories for your customer service tickets. The problem is that most of them don’t give you an action to take or a place to go from there without running additional reports to see the devil in the details.
Key Performance Indicators are far and away the best alternative because the data has been pre-screened for exactly the indicators that you are looking for so that additional reports are not necessary. The challenge is knowing your business well enough to know what situations in the database would raise a positive or negative flag that need attention. For instance, if you have a KPI for Activities weekly per Sales Representative it doesn’t tell you the root cause for the issue…just that the issue needs attention.
The Status dashboards are probably the most worthless of all. Using these types of dashboards assumes that all of your processes are outlined and you get to see where things are “stuck” in an assembly line. If you have complicated processes then these types of dashboards have even less relevance. If you have seven different sales processes then looking at one funnel that shows the Stage of Opportunities you have a lot of work to do to get to some valuable data on a given process.
So what is my point in telling you all of this? Well, in all of these scenarios there is a need for the user of the dashboard to have a fair amount of internal savvy regarding the data and what to do in order to find something actionable that is meaningful to him or her in their daily role. I tend to lean towards a different approach when dealing with data.
If you know how you want to run the business and the conditions in your database that require an actionable event then your answer is probably not in the world of dashboards but in the world of workflow and automation. This is a bigger discussion for another blog article so I won’t delve into it here.
At the end of the day we all have more data that we will ever be able to go through and we will all be better served through notifications and alerts tied together with meaningful reports before we go buying a CRM application based on who has the prettiest dashboards.
There is a funny phenomenon that happens when the going gets tough or the economy slows down. Marketing teams get into high gear or seem to shut down when it comes to attacking their marketplace. There doesn’t seem to be a middle ground. As I have talked to many of my customers about their thoughts in this area they seem to concur. One of the biggest surprises that I have found is that many of these teams have universally chosen to attack new customer acquisition.
Thinking about this approach it is a natural tendency to go after attracting more leads and new customers. The cost to land new customers, however, continues to climb higher and higher when there are fewer dollars flowing in the economy. This is why I think those teams that really want to exceed their wildest expectations for this year need to take a different approach.
Lost customers or dormant customers are the quickest and fastest way to prime the proverbial revenue pump in a down economy. There are lots of reasons why. Let’s take a look at why this approach may make the most sense for you and your teams.
1. If you have had a CRM program for customer database for some time you probably have more intelligence about the likes/dislikes of lost customers or those that have been dormant for some time.
2. If you lost a customer there are usually opportunities for you to take advantage of your competitor’s weaknesses or challenges they may be facing in times like this.
3. Inside many organizations there are high turnover rates and the people that chose to sever a relationship or move in a direction may have already moved on and there is little or no history with the people who control the purse strings for that customer today.
4. Access to the right people and the likelihood of reaching lost customers is usually a bigger bang for the buck as far as messaging from marketing initiatives and therefore likely to generate better opportunities.
5. If you assess the opportunities and feedback from old customers you may also find new opportunities with intelligence about their needs that may be more effective in creating even more campaigns to revive lost revenue.
There is definite value in working smart over working hard in times like these and the best advice may be to look before you leap.
It is shocking to me how often I walk into a room and I hear sales executives talking about hosted CRM like it is the only option. While it is easy as someone who offers Software as a Service (SaaS) CRM to just present that option and go with the flow I rarely take that route for several reasons.
There is a HUGE difference between the reason enterprise size organizations and the mid-market organizations I usually deal with decide on whether or not to deploy a on premise or hosted CRM. In the larger organizations SaaS is usually an Information Technology strategy. Conversely, most of the solutions I am involved with usually disclose that SaaS as an option is either a pricing decision or because of lack of knowledge of the other options.
To confirm my findings I decided to fill out a request form on a well known SaaS sight to see what the sales “Pitch” would be once someone called me to promote their solution. The call came in just a few hours after I filled out the form from a call center and decided to play along. I learned some interesting things through my conversation.
The sales person claimed that moving my sales team onto his product would provide a return on my investment in as little as a few days if not weeks. He said that most of his customers were able to setup and import their information in a few days to a week and that my team would be “productive” in no time at all.
I thought it was funny that I had not even explained my needs and my payback would be almost instantly. I told him that I wanted to do some analysis around my sales operations and then make some decisions around how to deploy a CRM product to get his response. He told me that while some “big” companies spend a lot of time doing analysis the majority of his customers did not engage in hiring a consultant. He did offer his company’s professional services if we needed help importing or setting up the program.
Needless to say there are certainly situations where this might be the case but in the last 10 years I have found few companies that can simply setup and go with little or no guidance. Since he brought up the issue of his customers I asked how long he had been giving CRM advice. He avoided the question for a while but then said he had been with the firm for a few months and never worked with CRM before this job. I told him that I would be more comfortable if I could talk to a few of these references who had their payback in just a few weeks.
Once again there was some hesitation and he said that all I could read more about his company and made reference to a few articles on line that I could read about his company and their solution. I told him that I would ask around and do some more reading and get back to him in a couple of weeks. To my surprise he called the very next day with his manager and proceeded to try and convince me to get several people on a trial and that if we were happy with the setup we could do a contract by the end of the month. I mentioned that I did some research and talked to a couple of the other household names in CRM and they were willing to come to my office and meet with me to discuss my needs and demonstrate how the software would meet my needs.
At this point his manager offered to setup a demonstration and said we could talk through my issues at the same time they showed me the software. I asked about having someone come to see me and he said that for the number of users there was no way we could see someone in person and then have a customized demonstration to show a proof of concept.
Things went on for a while and told them that my management made me go in another direction to get the calls to stop.
I am not sure if anyone else has had a similar experience but as a long time CRM evangelist I have a problem with the method to the process for selling CRM in this manner. It’s hard to even begin to go through the iterations of the how and the why selection of CRM isn’t just a couple of calls and a demonstration.
The most important thing that people should know is that if you look at the market share for CRM the hosted applications have not even penetrated 10% of the market. That is hardly a hard shift in the deployment option for most companies. This may very well be the option that you choose but understand several things before you make the leap:
1. By deploying CRM what is it that you are trying to address?
2. If you look at the cost of hosted vs. on premise can you justify the long term costs over a 5 year horizon?
3. Do you need to integrate other on premise systems and what would it cost?
4. Will the users of the system be able to use the system in their typical daily life or do they work disconnected most of the time?
5. Are you really looking to deploy something quickly without looking at or changing your existing processes to better run and manager your business?
6. How important is having a local presence for counsel and advice or are you going to succeed without much guidance?
Remember that fulfilling your mission includes making your user’s lives and productivity better than they were before you deployed CRM. You also don’t get a second bite at the apple when deploying this type of technology.
I just completed the end of another quarter and was running through an analysis of the projects that we successfully acquired and those that went some other direction. I also thought about the discussions in the board room recently and the reasons people are telling me they "need CRM" or need to change the implementation they already have.
First, let's critique my own efforts... Nice wins from very strategic customers. Did those customers buy based on product specifications? No. Did those customers buy based on a lower price? No. Did those customers buy because of the promise for lower consulting rates or time to complete the project? No. Well then why in the world did we win? I will address this at the end of this article.
I am not sure if any of you have ever seen the movie Sliding Doors where you get to see what happens to the same person based on one single event of either boarding/not boarding a train and the results that come out of it. I am going to attempt to recreate that here with one of the sales processes just completed.
In the first scenario we are going to look at the approach a sales person would take if he looked at this sale driven by an internal CRM sales process assuming a complex technology sale. Initially, this sales person would need to find the decision makers and establish a budget. The system would then tell the rep to define the pain points and create documentation and a budget letter explaining the issues and the financial impacts of addressing those issues with a solution (preferably his/hers).
Checking off yet another box when a demonstration has been scheduled the system is telling me the rep that the revenue is projected at 60%. Continuing on down the yellow brick road leads to a proposal following the demonstration, 80%, almost home. A few tweaks to the contract and some revisions to the proposal and a little more negotiation and the Opportunity is won (or it may go the other way based on many, many factors).
That in essence is how most CRM technologies are built and being asked to present this type of solution to my customers five years ago was run of the mill and discussed almost every day of the week. Now let’s walk through the same deal using CRM as a competitive weapon.
The sales person gets the lead and instantly looks up the company which is already in his system. An Opportunity is established and then the first thing the rep does is to look at all associated contacts and accounts (this includes the prospective companies vendors, competitors and consultants) to see if he or she knows anyone with any more insight into this account.
The sales rep skips past the budget field in the CRM tool and moves on to schedule meetings with two or three people that know something about this account. The rep is also able to understand what type of projects have been completed for this specific type of company and learn more from his own team members.
After a few meetings and collecting more data the rep asks to meet with senior people to confirm the issues documented to date. By the time an RFP is created and sent out to various vendors the representative is already in visionary discussions with multiple decision makers in the firm. Because competitors and strategies for those competitors are tied to the opportunity new intelligence from any other sales team member is readily available.
When presentations and proposals are completed the solution is an afterthought because the “sale” has really become about the people involved in helping the prospective customer reach their goals and not the product stack being proposed.
The CRM system is ultimately updated with all of the same information and if you looked at the same opportunity two years down the road you would not see any difference. But, in reality, there is a real difference. In one instance a company is improving performance and execution by using the technology a centralized management tool for all deals and the first company is using CRM in a much more “technical” way according to how the system is configured.
Jumping back to the beginning of the article of why my customers chose me last month…it’s because they want their sales teams to be dynamic and have the flexibility to sell more effectively. They want a person’s life to be better the day they start using CRM than their lives before CRM. Lastly, they have systems that leverage people and their knowledge rather than systems that turn their people into data entry experts.
So if you want to know if your CRM is making your people a commodity ask yourself how many deals you won last month because of your process and how many deals you brought it because of your people…that will tell you what type of solution you have implemented.
Over the past couple of weeks I have noticed that the temperature in the board room is rising. By that statement I mean that it seems like more and more people are coming to the table to discuss Customer Relationship Management with a focus on increasing sales and maximizing revenue. The reality is that some people are starting to experience more and more challenges as companies are scrutinizing spending and profit margins.
When times get tough there is also an opportunity that we don't see very often. Executives are more open to listening to new ideas and people that make their living in sales are also more willing to openly discuss the challenges they face in reaching their goals. I decided to take what I have learned in these discussions and outline how CRM can help an organization excel in a less than stellar economy.
1. Cash is King - If you take a look at macro economics and think about the concept of a recession it just means that there are fewer dollars in play and every sale is that much more important. When you think about the concept of CRM and Sales Process it enables us to solidify discipline in our sales activities. Rather than chasing business outside of your sweet spot each deal you can bring in brings your competitors closer and closer to bankruptcy. With the right CRM deployment you can optimize your sales teams activities on the business you should be focusing on.
2. People Buy From People - There have been many, many challenges with CRM over the years. The number one problem from sales people is the concept of not being able to sell because they have been turned into data entry clerks. By contrast, the modern concepts in CRM are all about freeing up sales people to practice their craft. If you think about how much time they spend on meeting and phone calls sourcing information from internal departments then think about how much sales time you could free up for them if you bring them critical information in a centralized location where they can leverage the information to bring in more business.
3. It's All About Speed - I guess the easiest way to define this is "Selling Darwinism". Whether or not you are a consultative selling organization its hard to sell anything if you can't get time with prospects to pitch your wares. With the Internet customers are buying and making decisions at break neck speed. CRM provides the opportunity to marry sales and marketing so that lead distribution happens in close to real time. If you are first to get to the prospect you have half the battle won.
4. It's Not Rocket Science - Think about what it takes for you to acquire a customer. Then what happens...for many companies not enough. If your sales team and marketing organization have the right approach CRM can help you leverage existing customers and significantly increase revenues from a significantly lower cost of sale. When you add in the right approach to Customer Service you can really ramp up lots of idle revenue waiting to happen.
5. Concentrate On The Pain - If you get involved in a true discussion about how to improve performance on your sales team lots of challenges will come out. The problem is that if you try to address everything at once you are likely to end up worse off than when you started. Prioritize on getting the basics down first and then you will see how quickly things get better in a hurry. Don't write a rigid plan for the ongoing implementation. Instead meet with your teams in the field and continue to concentrate on the "hot" topics.
I could continue to go on but there is enough meat here to sink your teeth into. Remember that those who create value in the most trying of times will reap great benefits when times are good.
OK, so things have been extremely busy but if I am going to take this blog thing seriously I need to be more disciplined. Now that I have admonished myself for not posting last week I want to jump right into something I have been dealing with on several different projects.
As I write this one project I will refer to is a re-implementation (same software package from scratch), another is a brand new implementation of CRM for the first time and the final project is an expansion of a current implementation.
Let's deal with the concept of a company making the decision to stick with the same software package they already use for CRM but wanting to take a fresh approach to start from scratch. The problem they run into is history with both the users and the enhancements and data they have captured.
Here is where the crawl, walk, run approach is effective. First, I counseled them to take a clean the approach that some or all of the data they have collected may have limited value to their fresh look at a CRM deployment. In order to do this we will walk through analysis without regard to what has already been done.
The most practical way to get this done and keep people working in their production system we will upgrade the core system to the "out of the box" current version of the product. We will evaluate custom fields for critical data and place the view of that data in a centralized location on the Account level while we do analysis and decide on new customizations.
This approach will accelerate the speed of moving to the new version of the product and also leave behind any pre-conceved notion of what was deployed in the past. After we "crawl" then we will complete the analysis and deploy the appropriate modificaitons to represent their current business environment and then get feedback from the users on what works well and what needs to be tweaked. In this case we are "walking" when users are up an running on the new deployment and adjustments have been made. Finally, we start "running" when we look to automate processes and create operational efficiency through workflow and alerts.
The second project involves the case of an organization that is deploying CRM for the first time. In this scenario we do analysis of the business and work with the client to prioritize the greatest areas of need. Then we do a first phase deployment to get users adopting to the first version of the system and start "crawling". After we see how the business is adjusting to the system we do a second phase of analysis and prioritize the new results for a second layer of enhancements to start "walking". Lastly, like the first scenario, we then look to apply automation and workflow to optimize operations and beginning "running".
In the final project I want to look at they use CRM in a part of the business but not throughout the organization. We have one group "walking" and the others are not even "crawling". First, we need to do analysis and take each group moving onto the CRM deployment in individual silos. After we cross-reference common needs we adjust existing modificaitons where we can to create synergy and deploy new enhancements for each group specific to their needs and get each team "crawling".
When we regroup to get each group "walking" we need to do anothe round of analysis to see how having the new groups on CRM will impact the group as a whole. We will then make necessary adjustments to the system to account for challenges created through having a company wide system as opposed to one individual department utilizing CRM. Now that we have the entire company "walking" you guessed it...we can automate workflow and alerts to get the solution and its users "running" on all cylinders.
So why write about this topic? Simple, the practical approach to any CRM project is based on some simple principles. First, figure out what's important without taking too much stock on what happened in the past. Next, take a fresh look after all the parts are moving and see what needs adjusting. Then, when all is operational and buy in is complete, figure out how to simplify people's CRM experience by letting technology enhance their ability to execute the company's charter.
I am coming off a week where I spend countless hours in meetings and conversations with a software publisher and various business partners regarding the concept of integration between various CRM and ERP solutions. I figured it was prudent to do my first blog in a couple of weeks to discuss some thoughts in this area.
The first thing I think it's most important to understand are some of the fundamentals regarding the concept of integration and the value derived when you get it right. In the past few years I have done countless implementations of what you would call stand alone systems. And, before the "ink is dry" on the first phase of many of these projects customers begin to see gains in many areas of sales and service operations. These gains are quickly limited by increased bottlenecks when dealing with other departments within the company.
I would like to step back a bit and talk about one of the basic concepts that gave CRM a jump start in the business community to start with. A customer relationship management solution has value over a basic contact management or opportunity tracking system because two other integrations have already been integrated into the core solution. CRM at its basic level bring together marketing, sales and customer service into a centralized environment. If we understand this basic value add then we should also understand that it's impossible to leave these operational units compartmentalized away from the rest of a company's operations.
So the question becomes "How do I approach integration and what should the scope be in order to make my organization more efficient?" The answer is dependent on the type of business you are in and what your highest operational challenges within the firm. If the priorities are not immediately apparent you can conduct a few exercises to reach your conclusions:
1. Analyze the flow of information within the firm.
2. Document any bottlenecks you identify.
3. Assess the level of impact and how many departments are affected by any bottleneck.
4. Document the direction of the flow of data creating the bottleneck.
5. Meet with team members to discuss the analysis and decide on the financial repurcussions of removing each bottle neck.
6. Approach the area of greatest need and limit the scope of your first round of integration to one bottleneck only.
Here is a real world example from one of my customers. The company became very efficient in their selling efforts and began to grow quickly as a result of their CRM implementation. The company came to me and said it was imperative that they integrate to the back office in order free up even more selling time by pushing orders into their ERP system. Before jumping right in to scope the order integration I asked if we could run through the process above. They agreed and this is what we found.
As it turned out the order entry process was the least of their issues. Because the company was a services based company without inventory the order entry process was fairly simple. They needed only to enter a customer into the back office system in preparation for billing of services. There was usually a first invoice necessary for a retainer but new customers usually took only about 30 minutes to enter into the new system. The analysis revealed that customer service was suffering and projects were being impacted by the lack of resources available to complete sold projects.
The company was using a point solution to manage their projects and needed to find a way to push their resource scheduling and availability of personnel to the sales team in order to give visibility on lead times needed for new projects. The company was spending significant dollars outsourcing work in order to meet promises made during the sales cycle. And, due to the complexities of outsourcing, sales and project managers were spending nearly one day a week meeting to discuss scheduling and work through project challenges.
Instead of simply taking the approach to integrate to the back office (which would have taken about six weeks to complete) we recommended that the firm hire a sales operation admin to take on the task of entering new customers and initial invoices into the ERP system. We then focused energies on enhancing the CRM system to provide more detailed quoting capabilities for the resources need to complete the projects being sold. We integrated the quote to convert to a project in the project management system to eliminate duplication of entry. And we created a portal within CRM to show high level resource availability and created a "What If?" analysis tool within CRM to show the impact of deliverable dates when outsourcing was used.
The net effect of integrating the right information between departments created significant value to the firm. More importantly, the 8 hours of weekly meeting time to discuss project and resource challenges was shortened to a one hour weekly status meeting between sales managers and project managers. After all was said and done the company freed up 17.5% more selling time and profitability increased on most projects because the need for outsourcing was minimized.
I like telling this story because it shows how assumptions can lead to bad decisions. Integration affects the entire firm so it's important to take a look at the entire environment when considering bridging internal platforms.
When we finally decided to address the order entry integration we found it cheaper to replace the ERP with a complimentary back office system to the CRM where the publisher's core integration included all of the necessary elements needed by our customer. Had we gone the other way the customer would have paid for an expensive integration and ended up with more disparate systems and the project management intetration would probably never have happened.
It's funny but after working at doing the same thing over and over for years at a time sometimes we forget the little things that make all of the difference in the world. At this point you are probably thinking I have lost it and what does repetitively doing anything have to do with the consumption of pachoderms. Well, nothing to tell you the truth.
The comment about the elephant has to do with the a joke someone told me as a child. "How do you eat an elephant?" Answer, "One bite at a time." I thought of it yesterday as I sat in a meeting with the CEO of a fairly successful medical device manufacturer. The elephant in this instance is actually a CRM implementation and eating the elephant deals with act of successfully coming through a CRM implementation and finding real value on the other side.
I explained to the executive that I had probably skipped a couple of steps in the discussion of how to approach CRM regardless of the industry or focus for the application. Some things are just universal. Here is some of what we discussed:
1. When most companies deploy a new ERP or Accounting system they usually have experience and some level of pretty descriptive needs. In a CRM deployment there is a foundation, set of tools, and your imagination. Even today nearly half of my deployments are not replacing a system but putting one in for the first time. The lesson here is to take small bites at the beginning.
2. Since no one is holding a gun to your head on what you must do take a pragmatic approach to lay out a long term vision and then pick two or three immediate challenges to address. The long term vision helps to make sure that short term decisions will not create heavy costs or dire implications when trying to reach the long term goal in the future.
3. Figure out the political aspects of your project. With those first few objectives outline "wins" for the individual that you are hoping to accomplish and "wins" for the organization. If there is not something for everyone or you don't involve the people that must use the system every day it will be an uphill climb at best.
4. Keep analyzing your business and creating a priority list based on what is happening in the business. This is important because the busienss climate continues to change yet so many projects I have seen fall flat because they lose alignment with business objectives. The project team stays true to their vision from several years ago even though a new vision or new leader may have changed direction for the firm and its goals.
At the end of the day everyone probably realizes that you probably can't eat an entire elephant and certainly not by yourself. In fact, in the past ten years, I have stepped away from the figurative "table" a few times to catch my breath and so have many of my customers. All of this is important but artificial timelines and mandates won't get you any closer to having a system that people understand and embrace.
So, to my CEO friend in New York, open wide and take the first bite. It's an acquired taste but wait till you see where you are a couple of years from now.
Anyone who knows me understands how much I like the sport of baseball and movies about sports. So what does a "Field of Dreams" reference have to do with CRM? Funny enough...everything. If you haven't seen the movie starring Kevin Costner you can consider him your CRM project leader.
His challenge is that he knows the benefit of doing the project in front of him but he cannot quantify the benefits of this project to anyone in his family or those around him. For the sake of argument lets call these people his internal team members. Even so he remains steadfast and eventually brings everyone together to reap the benefits of the completed project (I know, it's a baseball field in the middle of nowhere).
This vision came to me last week when I was sitting in the middle of a meeting an executive of one our existing customers. They have been running CRM for over five years with some success but they have not made the turn with CRM to where it is a competitive weapon. People rely on it and non one argues its relevance but the user community does not embrace it like they can't live without it.
I asked him why he felt like his team was CRM saavy but not CRM evangelists and his answer was very enlightening. He said that his team had always talked about a "dream screen" early in the days of CRM and it never came to fruition. I dug a little deeper and he said the team wanted information from various sources all in one screen. I dug even deeper and asked what that would do for the front line employee.
He thought about the "dream screen" and what it would do for his company. After a while finally responded and said they would give faster service, do more transactions, alleviate internal bottlenecks and process more orders. So, as it turns out, the dream screen was actually a "value" screen that exemplified everything that CRM could do for the operational capabilities within his own firm.
Needless to say as we proceed to the next upgrade of CRM the "fields of dreams" will be on a screen that will take CRM to the next level for my customer and his organization. The lesson learned is that there is always value in listening to your users and the value can be mutually beneficial...not mutually exclusive.
It has been a few days since my last post but I thought I would start off this week discussing a reoccuring theme that keeps coming back year after year. The question revolves around the concept of deciding where the line is between CRM and other systems or departments. Unfortunately, the real answer is that there are no lines.
When I recently attended a software publisher conference in Florida I saw a customer that I first implemented CRM for back in 2003. The customer asked me if I had time to sit for a cup of coffee. Anyone who knows me knows that I would never turn down a cup of joe. So we started talking about the current state of his customer facing systems and how differently they look today than five years ago.
Paraphrasing the beginning of the conversation he began by saying, "Isn't this thing ever going to end?". My rebuttal, "Yes! As soon as you sell the company or close your doors." This phrase was not new to him. I actually spoke those words to his executive team back in 2003 prior to phase one.
The challenge when you start to look at CRM is that many times it's difficult to understand where you are going long term and almost impossible to keep from limiting yourself if you are myopic enough to concentrate on one team. The other part of challenge relates to the consultants or implementers of technologies and their particular approach to your solution.
The best analogy that I can think of without going into some Tiger Woods example is to think of fixing up an old house. So here it goes...
First, you need to assess the environment and decide which enhancements and modifications will add the most value to you. Next, consider the needs of each department like you would the needs of any particular inhabitant of the house. After you know what everyone wants decide if some of the desired capabilities or changes will impact the different people in the house.
If you find that some of the requests impact each other do like you would when working with an architect. Sit in a room and hash it out. Or, decide to disagree and table the changes until more important parts of the project can be completed. Either way you should end up with a master plan and a method to your madness.
The funny thing about the feedback I received when discussing this project is the same thing I still tell people in meetings today. I tell project leaders to be cautious, open minded, and willing to change according to what the market demands. Customers are funny and they will always provide feedback to tell you how to do more business with them.
At the end of the day you will likely end up with more and more people on your CRM system and any lines between people and departments will slowly fade away.
I decided to start this week with the topic of customer/prospect ownership because I was involved in several meetings this past week where we were dealing with the first deployment of CRM for a company and a consolodation of various databases in another company. In the case of both organizations they were dealing with one fundamental question, "Who owns the customer?"
It is not a surprise that both companies I was meeting were involved in various types of brokerage activities. In the case of of company none of their people wanted to enter information into the new system until business was actually transacted and entry was mandatory. In the case of the other the brokers wanted the ability to share information but very selectively. In other words, they wanted a system that was a company-wide system limited to the people that each one of them trusts.
Both of these firms have been struggling with these issues for well over a year as they each have several hundred people in business development roles and they operate in cross-over situations and do not have specified territories. This is a situation that whatever decision made by the company will be 50% right and 50% wrong. Let me explain.
From the stand point of people that are primary business developers there is a sense of "ownership" and possessiveness regarding their book of contacts. In other words, what ever contacts they meet are theirs and whatever leads the company sends them are theirs. Arguments can and have been made that without their personal touch these lists of names have little or no value.
The other point of view comes from the companies that employ these brokers and sales people. There are two contingents inside any particular sales organization. One group are the long time employees that built their book of business with the firm they are with. The remainder of the employee base is usually a set of transitory employees that work at a firm for a few years in search of the best payouts. Both have their reasons for protecting their territory and the issue must be dealt with head on when implementing CRM or consolidating into a single customer database.
Regardless of when your organization makes the decision it must ultimately make a decision to set policy regarding systems and customer data. No matter when the decision is made it will be unpopular. The group of longtime employees will distrust management and suspect lower payouts over time. They will also fear those transitory employees that they don't have long term relationships with and are suspect of their access to large volumes of customer data. Lastly, those people that have moved from job to job are inherently fearful of leaving data in a place where it may be difficult or impossible to remove once entered in a centralized system.
The harsh reality for any and all consolidation of customer data involves the setting of expectations. First, if producers or sales people are W-2 employees it needs to be communicated that the company owns data and all ownership and compensation will be related to the system of record. Next, it is important to remind people that it is impossible to protect their leads and contacts if the company does not know who they are. And finally, there must be a level of trust between employee and employer and this must be constantly reinforced until it becomes your culture.
I have seen more money spent on more systems trying to skirt the issue and satisfy fears and distrust from the front line people that bring in the money. They put in complex security rules and spend more money to revamp them time after time without dealing with the real issue of customer ownership. If dealt with properly you will still lose some people but the people that remain will be much more able to work within your rules and guidelines.