CRM's gone bad and is getting worse!

Friday, July 31 2009

Here’s a recent contribution I made at ModernSelling.com

As sales systems have evolved down the years, they have become cumbersome and over-complex. Richard Nolan advocates a return to basics but using the advantages of ‘the cloud’ if we’re ever to get our sales teams to love technology.

I have been involved with sales since the early 1980s where almost every year I had to meet or exceed pretty aggressive sales targets. This has meant working in a highly structured manner along with using the best tools available to help me achieve my goals, and yes it did mean moving away from my Rolodex!

Technology timeline
By the late 1980s we saw the introduction of some very exciting contact managers to help us better manage our prospects and customers; the original DOS version of Sage Telemagic was the one that stood out for me. These were very simple to use (even for those of us with fat fingers) and allowed us to enter our contact details and notes quickly and easily. With word-processing and mail-merge facilities it meant that we could also produce personalised, professional-looking sales letters and quotes, again, quickly and easily; something that we all take for granted today.

By the late 1990s, we began to see the take-up of customer relationship management (CRM) systems targeted at big corporates (SAP, Oracle, Siebel). These early systems were typically developed as ‘bolt-ons’ to established accounts and enterprise resource planning (ERP) systems, and were not noted as being particularly easy to use.

By the early 2000s we started to see take-up of these CRM systems into the mid-market. Although they were now much more integrated, these systems still could not be described as easy or intuitive. For example, many customers found the systems to be very laborious in setting something as simple as a recall date (and time) with far too many unnecessary mouse clicks (ie ‘OK’ requesters).

Cumbersome
As a result, the perception of many is that CRM is overly complex and cumbersome and tends to have a de-motivating effect on sales teams. This situation is not helped when the system is imposed on them by the business owner, IT or marketing department. In many cases, this leads to internal conflict and resentment and a general downward spiral where sales professionals come to the opinion that their CRM system isn’t serving them, so why bother taking the time to enter the details.

It’s not uncommon for sales professionals who ‘use’ CRM systems to only enter 40% of their contacts, so the majority of their work is not recorded in the system. Having taken the time and effort to contact the lead, they could at least enter their name and email address so that there’s a chance of gaining their attention at some point in the future.

Also, due to the complexities of using CRM, as many as 46% of licensed users don’t actually use their system, according to research!*

Many sales professionals also see CRM as ‘Big Brother’ keeping an eye on them, checking they are performing their basic duties (ie making the necessary number of follow-up and cold calls) and so, to keep motivation levels high, it is very important to explain how any CRM system is there to make their lives easier, along with giving them new tools to achieve even better results. It is not there to measure them.

Scorecard
So here’s the final scorecard on CRM: almost half of ‘users’ don’t use it; those who do, don’t use it consistently; many users even resent it. Despite these issues, CRM is still promoted as a valuable sales solution.

Contact managers like ACT (Telemagic was superseded when Sage took over ACT) and GoldMine that were once quick and easy, appear to have lost their way in recent years. Is this because they saw the growth in the CRM market and wanted to be part of it, or that they lost sight of what their customers were doing in the market? I believe it’s both.

All the major vendors of contact managers appear to have become CRM companies. They seem to be confused about their own product offerings as their desktop-based contact managers have become CRM systems, whilst they also have separate on-line CRM systems with a completely different user-interface. What’s more, they claim that their system ‘integrates’ with all the major emailing packages, yet the vast majority of their customers continue to use their email package of choice (typically Microsoft Outlook) separately. This means that contact details are ‘managed’ in more than one place which can lead to omissions and duplication.

How many times have you run a campaign to your prospects and customers (newsletter, open house etc) only to find:
• you have to spend a great deal of time carefully collating all the contact details from contact manager, email system, spreadsheets, and other databases?

• key prospects/customers were not included in your campaign because you only sent contacts from the contact manager and not the email system they were actually held in (and vice versa)?

• quality prospects ask you to remove them from your lists because they received the information twice, or more (because they were included in the contact manager and email system and another list)? and

• when importing data into the CRM system (eg updated data being returned from a telemarketing exercise) you find that the data has been imported incorrectly making your contact information a mess? In most cases, people no longer import data back into their CRM because of this.

Many of the leading CRM systems (SalesForce and Microsoft Dynamics) have fantastic websites and are able to give great demo’s of their products in action, but what they don’t show you is all the background work that has gone in to making the system function smoothly. Whatever system you decide on, be sure to undergo a thorough evaluation period before you buy to be confident that the system you do finally choose actually meets your requirements.

Sales forecasting, lead qualification and lead assessment
CRM’s not all bad, of course. Two areas that have proved particularly successful for sales teams are sales forecasting and lead qualification. These features are valuable because sales forecasting coupled with lead qualification can be quite a contentious subject: one person’s lead is another person’s suspect (when is a lead not a lead?) and can really help identify key players within the prospect organisation.

What percentage of your sales team delivers reliable forecasts consistently? Good sales forecasting tools can be very powerful and deliver significant time savings when put in the hands of sales professionals who are able to submit reliable forecasts. For instance, have you ever asked how much time your sales manager spends collating and checking all the information necessary to deliver an accurate sales forecast?

Some CRM systems have made a name for themselves (Siebel Systems now part of Oracle’s empire) in going a step further by delivering very powerful, but easy to use lead assessment tools. These help to ensure that the prospect is qualified, that there is a strong connection for the product or service being offered with the prospect, that there’s a good chance of winning the sale and that the sale is actually worth winning!

Any good system should allow you to constantly test and measure your key performance indicators (KPIs), so that you can see at a glance how well your organisation is performing. A good example is lead conversion rate, which is the number of incoming sales leads that are successfully turned into customers. Do you know the lead conversion rate for your company? What affect on your bottom line could increasing your lead conversion rate by 15% have?

There has to be a better way: it’s back to basics
What’s really required is contact management, and not CRM, that works across the ‘cloud’ (web) and is as quick and easy as the early contact managers (mentioned at the beginning of this article), but that gives you all the sales forecasting and lead assessment tools found in leading CRM systems.

Sales is one of the key markets to benefit from the advances in cloud-based computing in a number of respects. Cloud computing allows companies to work leaner than ever before; there’s no need for top-heavy IT and marketing departments (that’s a very bold statement – Ed!) as cloud technology allows you to outsource this to specialists in their field, reducing costs significantly.

There’s no longer the need for complex and costly network installations for remote, home or field sales workers; everything can be accessed from the Web, and all you need is a web browser with a good internet connection (most people now have a 2Mbps or better connection, even at home).

We are now starting to see smart phones becoming more and more viable, with high-resolution screens (640 X 400) and providers bundling in significant internet minutes on standard contracts. The Blackberry led the way and the iPHONE, with its amazing touch-screen interface, has helped to change everything. How long will it be before the smart phone replaces the laptop as the accessory of choice for the sales professional? (This won’t happen until the network providers can improve data traffic speeds as recent surveys have reported almost universal disappointment with this aspect of their service – Ed.)

It’s fair to say that’s there’s a big difference between successful and unsuccessful organisations; the main difference being that the successful ones have the necessary tools in place to track, adapt and respond quickly to market trends.

Most of today’s successful business management tools are based on cloud computing technology. For a long time, CRM has promised a lot and delivered very little. What if there was something available that could actually fulfil this promise?

Is there a system out there that’s endorsed by sales teams, which can be seen as an ally to sales professionals? A system that the sales team actually want to use, that’s easy, and has such powerful sales forecasting and lead assessment tools that it’s endorsed by upper management too?

virtualCONTACT has been designed by sales professionals for sales professionals. The first contact manager to be designed and built from the ground up on Microsoft’s SQL Server 2008. This not only helps to make it very simple, fast and secure, but you’re assured of seamless integration with Microsoft Office (Outlook, Access, Excel and Word). virtualCONTACT is an excellent partner for Microsoft’s new On-Line Services (cloud) products.

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