Monday, August 14, 2006

CRM: A Flawed Model?

CIO claims that up to 70% of customer relationship management projects (CRM) fail.

So, why is it that I receive regular calls from vendors trying to get Pano Cap to consider investing in another CRM package? Those calls are fairly simple to field since we already have a CRM module which is well integrated with our ERP (enterprise resource planning) software from IQMS - Enterprise IQ.

One of the major reasons why companies fail with CRM projects is because they don't implement it correctly. As some of us have experienced in consulting other companies in the region, very often software projects do little more than automate broken or incomplete manual procedures .Obviously, if a company has not carefully reviewed its policies and procedures in regards to the customer experience, automating the process only means that the company can make the same mistakes faster than ever before.

The same business problems that drive companies to adopt a CRM project are the problems that must be resolved before a CRM project is conceived. Sure, CRM software has technology features that excite the imagination. But instead of letting technology features drive the process, companies need to concentrate on the business problems they face in the marketplace. Once the problems are identified, a corporate strategy must be formulated and implemented in the existing manual processes before considering automation.

Let me say it again, "CRM is not about technology. It is about business processes that promote positive customer relationships."

Ouch! IT Managers don't often have to confess that information technology is not about the technology; it's about business objectives and appropriate strategy.

Currently, CRM is a flawed model. CRM technology solutions are about building repositories of information about transactions with customers. But ask any of your sales persons and he/she will tell you that creating positive customer experiences isn't about how much information you have recorded about the customer and your interactions with that customer. Positive customer experiences are all about building trust, being dependable, keeping promises, admitting mistakes and immediately fixing them, and honest and regular communication. Personally, I don't know any software that can deliver those features.

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