Last week I wrote about the struggle most B2B companies have getting their sales people to adopt their SFA/CRM system. Michael Krigsman's blog post about CRM failure rates: 2001-2009 last week pulled together statistics posed by various research firms over the last 8 years on CRM failure rates, and as you would expect, the numbers were all over the board:
- 2001 Gartner Group: 50%
- 2002 Butler Group: 70%
- 2002 Selling Power, CSO Forum: 69.3%
- 2005 AMR Research: 18%
- 2006 AMR Research: 31%
- 2007 AMR Research: 29%
- 2007 Economist Intelligence Unit: 56%
- 2009 Forrester Research: 47%
What this shows is that the definition of CRM success or failure is not clear.
The AMR data was the most generous, though it only measured “% [of] respondents that have experienced any implementation failures that kept them from ‘going live’." A few of the others were still looking only at the success of the "implementation".
As one commenter accurately pointed out, one reason its so hard to measure success of CRM is because most companies don't set quantifiable goals for what they're trying to achieve with CRM. I've heard of companies that have said "we have to implement a CRM, just like we have to have a phone system."
So how do we measure the success or failure of CRM? If we decompose the name, CRM is about managing relationships with customers. Everyone has seen those CRM vendor marketing diagrams that put the customer in the center with all the CRM modules surrounding the customer.
So the measures of success should be centered around the quality of those relationships. Why not interview customers and ask them if they are more satisfied with their 'relationship' with the company than they were before the CRM went in? Why not measure the ways in which the CRM system has resulted in increased revenue?
Of course, there are internal efficiencies to be gained, such as centralizing all your customer data in one place, and reducing the time it takes for customer-facing employees to access information about a customer. But if that's what companies are focusing on, then we should be calling it Customer Data Management. And all those things should have a positive impact on your relationship with your customers.
