DSC Tech Library
Customer Relationship Management
This section of our technical library presents information and documentation relating to CRM Solutions and customer relationship management software and products.
Providing timely customer service information is vital to maintaining a successful business. Accurate information provided in an organized and thoughtful manner is key to business success.
TELEMATION, our CRM and contact center software, was originally built on this foundation. The ability to modify Customer Relationship Management software is important in this ever changing business environment.
Telemation Customer Relationship Management solution and contact center software is ideally suited for call centers throughout the world.
Does CRM = Sales Effectiveness or Sales Ineffectiveness?
By Jim Dickie
As soon as we released our Sales Effectiveness Insights 2004 State of the Marketplace Review report, Barry Trailer and I started getting phone calls and e-mails from a variety of people; reporters, stock analysts, sales and marketing executives, CRM software vendors, etc., all looking to explore the same issue. Is CRM helping or hurting sales performance?
As part of the study, we surveyed 1,337 companies worldwide, analyzing in detail the sales challenges these organizations were facing, why those problems existed, and lastly how they were dealing with those issues (successfully or unsuccessfully). One of the 83 metrics we examined was what role was CRM playing in the sales effectiveness plans of these sales forces.
The statistic that seems to be generating a lot of attention is the fact that, of the companies surveyed who implemented CRM systems to support their sales forces, only 25.7 percent reported that they are seeing significant improvements in performance as a result of that investment. Numbers like this always spark the debate over whether the glass is half empty or half full (or in this case three-quarters empty, one-quarter full).
In taking a deeper look at a cross section of the firms that were achieving significant results, some world-class performances surfaced. We found such improvements as revenue increases of 54 percent per sales rep, lead generation rate increases of 310 percent, decreases in the time required to get new sales people productive of over 27 percent, cross-selling/up-selling improvements of 102 percent, cost of sales decreases of 31 percent, and more.
When we have reviewed these case studies with sales executives and their teams the interest level in the room skyrockets. But then the reality sets in. While these are impressive numbers, why is only one in four projects achieving these types of improvement in performance?
In reviewing projects that achieved minor or no improvements at all, as a result of their CRM investments a number of factors were identified, but one surfaced much more often than any other. When projects do not achieve significant results most often an underlying cause is that the company implemented a solution and then went in search of a problem, versus starting with a problem and then implementing a solution.
Let me clarify what I mean by that. Bear with me for a moment, and envision a huge box of tools used for construction; everything from basic wrenches and screwdrivers all the way up to high performance band saws, drill presses, etc. Any builder will tell you that you need to use the right tool for the right job. If you need to nail something you use a hammer, not a blow torch.
Now let's equate this to CRM. A colleague of mine showed me a product map that he received from one of the major CRM vendors which listed all the tools contained in their system; contact manager, opportunity manager, marketing encyclopedia, pipeline manager, help desk manager, etc. I didn’t count them all, but there were easily over 100 functions described on this document. So, just as in the construction tools example, with CRM we also have a large tool chest at our disposal. But the logic of right tool/right job often falls by the way side.
For example, we reviewed the sales effectiveness initiative of one firm that had a huge order entry problem in sales. When they started their CRM efforts, they initially implemented a contact/opportunity manager. While this is a fine tool, it was virtually useless for dealing with the job of eliminating the order error problem that was crippling their sales rep effectiveness. Had they implemented a product configurator first, they could have solved the key problem at hand, and they would have seen CRM in a whole different light.
I am a firm believer that CRM works. It definitely can help solve all the sales and marketing challenges we face, if we approach the projects the right way. To help more companies migrate into the "significant improvements" column, every other month over the next year we will be profiling a successful CRM initiative. We will highlight how the team surfaced the problem worth solving, what components of CRM they used to deal with that sales effectiveness challenge, and finally we’ll profile the results they achieved. Hopefully by seeing how our peers have applied the right tool to the right problem, we will all gain useful insights into how to address the sales effectiveness challenges we each face.