The Sales Enabler - Jeff Ernst - Sales Enablement Best Practices

Measuring CRM success (or failure) rates

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.

Sales reps will never use SFA, so stop beating them over the head

I hear it at least 10 times a week.  Every sales or marketing manager I talk to about Sales Force Automation (SFA) says that their company has to beat their sales reps over the head to get them to use it.  Here's how one of my clients describes their SFA experience:

“We spent almost half a million dollars to roll out our SFA system back in 2005, because we wanted more visibility into our pipeline so we could get better sales forecasts. We tried everything to get the reps to enter data. First we offered incentives, but that didn’t work. Then we started sending emails to the sales managers when their reps hadn’t logged in. That didn’t work either.  Now we're threatening to withhold commission checks if they don’t update their deals. So the reps wait until the night before their sales manager's meeting with the VP to make update their deals. We don't have much confidence in the data, but at least we’re getting the salespeople to log in.”

I wish I had a dime for every time I’ve heard someone tell a story like this about their SFA adoption struggles.

You can't blame the salespeople.  They want to be out selling, but we're asking them to be bookkeepers.  As Joe Galvin from SiriusDecisions puts it, "SFA really stands for Sales Force Accounting, since it provides management with visibility into sales but does little to help people sell." 

It's no wonder it takes a stick to get them to use it.  Stop beating them over the head.

What would your reps say if you asked:

• Has the SFA system helped you be better prepared for the dialog you need to have on sales calls?
• When was the last time you won a deal because of your SFA?
• Do you get more value out of the SFA than you put in?

The last question is the kicker.  The value meter is way out of whack.  Reps are being asked to put a lot of data in, but they're not getting an equal amount of value out.  So they stick to using the tools they value...their Blackberries and iPhones.

While an SFA system has become an absolute necessity for the management of a sales team, it has been implemented as a tool of control rather than a tool of sales enablement. Traditional SFA systems are intended to collect data about sales activities for the benefit of managers, so they can get their pipeline and forecast reports, but are not built to help a sales person sell better.

If you want people to use your SFA and keep their opportunity records updated, give them a reason to go in.  As you're discovering the messages, tools, and conversations that are proving to work for your best reps, make sure these are delivered to your sales team through the SFA.  Put your sales playbooks into the SFA.  Turn your SFA into an SEA... Sales Enablement Automation.  More on this next week.

What is SFA usage like in your company?  And what have you done to get reps to use SFA?