Issue link: https://www.e-digitaleditions.com/i/571132
32 FEDA News & Views The Original Promise Back in the old days, business-to-business selling meant establishing and nurturing a personal relationship between your sales rep (usually in the field) and a buyer or other deci- sion maker in the customer's organization. However, increasing margin pressure, more sophisticated inventory management practices, proliferating logistics options and the emergence of new sales channels turned this cozy world upside down. To quote the title of a famous 2003 Harvard Business Review article, "The Customer Has Escaped" from the one-size-fits-all sales model. Sophisticated buyers have powerful new sourc- ing tools and are no longer willing to pay for ser- vices they do not need. Relationships alone are no longer enough. The promise of Customer Relationship Management (CRM) software was to address these challenges. It prom- ised to help companies become "customer-cen- tric" organizations that could quickly identify and respond to chang- ing needs. The software would provide a seam- less view of each custom- er, tracking all interactions whether in person, over the phone or via the website. By collect- ing and analyzing this information, CRM would help a company segment its customers, and fine-tune pricing and service levels. This, in turn, would improve profit- ability. At a tactical level, the software would use integrated reporting and workflow tools to identify daily sales activities to achieve corporate priorities. Companies could identify major leads and target important marketing campaigns. The Reality All this crunching and steering of customer data using leading edge software is certainly impressive. Unfortunately, the most powerful bits of information do not reside only in a computer data warehouse. They also lie between the ears of the sales rep (or maybe in notes taken by reps during or after customer calls). The type of customer data that is computer- ized is mostly transactional in nature, because this is what the legacy business systems require to process orders. It's easy to extract a customer billing address, the number and types of purchases, the number of web page visits and so on. But with- out an experienced sales rep to interpret the data, it's difficult to ascertain customers buying triggers, a competitor's share of purchases or evolving needs. The software salesperson's solution is to get the sales force to feed the system. Executives quickly agree with this solution because they consider data centralization to be an important benefit of the CRM project, a way for the company to claim its proper ownership over the customer relationship. Many times, however, this approach leads to reactions ranging from subtle sabotage to outright insurrection from the sales force. They object to the time it takes to enter the data into the system, after all this eats into pre- cious customer-facing activities, and doesn't add a dollar of sales rev- enue. Rightly or wrongly, they also fear that divulging criti- cal customer information will make them easier to replace and threaten their commissions. Finally, the CRM software programs, themselves, often seem purposely designed to irritate the less-than-computer- savvy sales rep. In fact, they are often less than user-friendly with their convoluted screen navigation, geeky nomenclature and functional overkill. Many times all reps get is a pretty color chart that summa- rizes all of their manually entered data. At the end of the day, the informa- tion does not provide any new insight, increase sales or make the reps job any easier. The net result of adding poorly implemented or explained CRM software is a vicious cycle. Reps do not use the new sys- tem because the data is incomplete; for most of them, it's eas- ier to continue working with the old data sources, such as the enterprise resource planning (ERP) system, personal contact lists or paper records. As long as everyone continues working ing tools and are no longer - software was to address these challenges. It prom- ised to help companies - ing needs. The software would provide a seam- less view of each custom- er, tracking all interactions whether in person, over the phone or via the website. By collect- ing and analyzing this information, CRM would help a company segment its customers, and fine-tune pricing and service levels. This, in turn, would improve profit- ability. At a tactical level, the software would use integrated reporting and workflow tools to identify daily sales activities to achieve corporate priorities. Companies could identify major leads and target important marketing campaigns. All this crunching and steering of customer data using from subtle sabotage to outright insurrection from the sales force. They object to the time it takes to enter the data into the system, after all this eats into pre cious customer-facing activities, and doesn't add a dollar of sales rev enue. Rightly or wrongly, they also fear that divulging criti cal customer information will make them easier to replace and threaten the less-than-computer- savvy sales rep. In fact, they are often less than user-friendly with their convoluted screen CRM software continues to suffer the highest failure rate of any enterprise software, but there are ways to reduce the risk of failure and increase chances of success. Avoiding the CRM Trap Avoiding the CRM Trap Avoiding the CRM Trap By Steve Deist, Partner Indian River Consulting Group