NETTING IT OUT

We’ve heard over and over again that 80 percent of CRM projects fail. We’re not sure that this is the right number, but there’s been a lot of commonality in the reasons for this failure. So much so that we’ve identified the top 10 reasons for those failures.

1. Expecting software to “do” CRM for you

2. Project scope too big

3. Project scope too small

4. Mistaking sales force automation for CRM

5. “Not so suite” part 1 (limited cross-channel support)

6. “Not so suite” part 2 (technology potpourris)

7. Cost of integration

8. Cost of customization

9. Inconsistent and incomplete analysis

10. Incomplete customer data

We want your CRM projects to succeed. We want you to avoid the mistakes that caused these failures. Take this medicine for successful CRM projects:

* Become a customer-centric organization by making it easy for your customers to do business with you.

* Start small and grow with CRM. Take a service-oriented approach to extend your CRM foothold.

* Understand your customers’ behavior through data warehousing-based analysis.

* Harness all of your customer data to create a complete and consistent view of your customers.

80 PERCENT OF CRM PROJECTS FAIL

We’re not sure about the origins of the metric that 80 percent of CRM projects fail. We don’t know who cited it first, but we’ve certainly heard it and read it many, many times--from the press, from other analysts, from CRM suppliers, from business-to-consumer and business-to-business companies, and even from customers. We’re not sure that it’s accurate. But, “80 percent of CRM projects fail” has taken on a life of its own. It’s been the angle of many news stories and analyst reports. It’s been the theme of all sorts of keynote presentations. Most significantly, it’s too often become the insurmountable objection voiced by decision makers in companies considering CRM projects.

That’s too bad. CRM applications are the mechanisms that you can use to help you become customer-centric, enabling you to build stronger relationships with your customers. Stronger relationships lead directly to improved satisfaction and loyalty. And improved satisfaction means improved profitability. So, CRM projects success can translate directly to bottom-line business success.

The Top 10 Reasons that CRM Projects Fail

Obviously, we can’t deny that there have been failures in CRM projects. We’ve witnessed a few first-hand. But understanding why CRM projects fail can help make your next CRM projects succeed. So, based on our experience and on our continuing customer-focused research, here are the top 10 reasons that we’ve seen for the failure of CRM projects:

1. Expecting software to “do” CRM for you

2. Project scope too big

3. Project scope too small

4. Mistaking sales force automation for CRM

5. “No so suite” part 1 (limited cross-channel support)

6. “Not so suite” part 2 (technology potpourris)

7. Cost of integration

8. Cost of customization

9. Inconsistent and incomplete analysis

10. Incomplete customer data

Expecting Software to “Do” CRM for You

CRM is not just a technology category. Indeed, CRM software applications merely automate the processes and policies of a committed customer-centric philosophy and strategy. It is this strategy that is truly customer relationship management (CRM). Effective CRM requires your organization to take a customer perspective for all your business processes by letting your customers’ actions drive them and the applications that implement them. Further, a well-defined CRM strategy requires knowing who your most profitable customers are and ..