CRM Part 2: Putting in the groundwork

11 May 2004

Customer relationship management (CRM) software promises to deepen your relationship with your customers, increase your revenues and cut your cost. Sounds like a panacea for any organisation, but even the vendors of the software caution that CRM technology is not a silver bullet. Without doing the necessary groundwork any CRM project will fail.

“It’s the processes behind it that make it work. I’ve talked to people who installed CRM software and then expected an automatic increase in revenue — it doesn’t work like that,” says Glynis Elrington of Sage Ireland. “You have to map out every single business process and improve them on paper first. Then you map what you want to do to Sales Logix.”

Sage provides two main CRM products: Sales Logix for mid-tier companies that want to customise the solution; and ACT for smaller organisations that want an off-the-shelf package that provides basic CRM functionality. Whatever product a company chooses Elrington believes that unless the people, processes and customer service ethos are first put in place any CRM project is doomed to failure.

The requirement to get the processes right first also helps explain why industry analysts are reporting a move to smaller granular projects rather than the company-wide ‘big bang’ approach of a couple of years ago. Many of these projects produced mixed results, which resulted in a backlash against CRM with many users saying it was a woolly concept that provided a questionable return on investment.

“With the ‘big bang’ approach there was no understanding of what you were trying to achieve and projects started to take on a life of their own,” says Fiona Walsh, general manager of SAP Ireland. “The most fundamental success factor of CRM is understanding what you are trying to achieve and ensure that’s measurable. If you don’t do that you can’t measure your return on investment.”

Getting buy-in from key management and staff is also essential, something that tries to achieve by offering its CRM service on a 30-day free trial. “A lot of small companies have an enlightened owner or director but there may be others in the company who say we don’t need CRM, we’re doing fine the way we are,” says Fergus Gloster, a director of’s EMEA operations. “With a trial you can let the reluctant people try it themselves.”

Neil Tanner, business manager for Microsoft’s Business Solutions division, also advocates initially biting off a small chunk of your customer interaction problems. “We want people to understand it’s not that complex,” he says. “Companies should pick one area they want to improve, bring in CRM and see the benefits.”

Colin Finlay, sales director for the CRM products at Waterford Technologies, recently acquired from DPD International, goes as far as to say the lack of user acceptance is one of the main reasons for failure of CRM implementations. Waterford’s Gold Inter@ction Suite integrates with Microsoft Outlook and captures all of a company’s electronic correspondence such as faxes and emails. “There’s automated filing of all correspondence with the customer even when a user is not in the application. They can even be using a handheld BlackBerry — once the mail goes through the Exchange server it is tracked,” explains Finlay. “The key is that the mining and organising of information is going on without relying on the user.”

Elrington says that the successful introduction of CRM requires staff that are really interested in customer service. She suggests appointing product champions and super-users who can act as role models for the rest of the organisation and supporting all staff with the necessary training and support. “Fundamentally they [staff] have to understand how it is going to help them help the customer,” she says.

Choosing a software vendor that has particular knowledge of your industry sector and how it does business is another way of helping to ensure the software meets your operational needs. Dublin-headquartered banking and insurance software house Fineos offers CRM as a central part of its technology that enables financial institutions to deal with their customers through a range of channels. “Traditionally the financial industry has used product systems that are focused on a particular area such as mortgages or savings and the customer information is a trailer on the back end,” explains Fineos CEO Michael Kelly. “With Fineos we put the customer on the front end and connect all the product information to that. No matter what channel they are dealing through all the information for that customer is available. It’s about making the right information available in the right place.”

A constant criticism from the specialists is that the large generic CRM packages aren’t flexible enough for the needs of SMEs. “The big CRM systems give benefits to the accounts functions but the usability for salespeople is a nightmare. I’ve talked to salespeople whose companies implemented them and they can’t even give a quote to someone without having to fill out 50 fields first,” says Noel Shannon, managing director of Microsoft CRM partner ProStrategy.

Even such broad-line enterprise vendors as SAP don’t try to push the one-size-fits-all approach. It offers versions of its CRM software tailored to the requirements of particular industry segments to provide what Walsh calls “an accelerated start” to implementations.

Next time: selecting the right CRM software for your business

By John Collins