Armies of consultants...

I liked Eric Doyle’s article in Computer Weekly earlier this month. It was the most sensible piece I’ve read about on-demand (software that people subscribe to as a hosted service rather than purchase outright and install on site) CRM in some while. Well grounded though it was, there were still some echoes of what I’ll term the ‘armies of consultants’ argument that I’ve seen espoused by on-demand fans in various other less reasoned articles lately.

The ‘armies of consultants’ argument goes along the following lines – and recognise I exaggerate a bit here – why would you Mr small/medium sized business owner purchase on-premise enterprise CRM software, when as a result you will be besieged by legions of consultants, charging millions in fees, who will spend years developing a system, that you will have to house in a data centre of improbable enormity, and which will produce no ultimate business value because by the time it’s delivered your business will have long moved on, when you could have the very same capabilities on-demand for just £50 a month and be up and running by lunch-time.

Ignoring the fact that this line of reasoning grossly exaggerates both the cost and complexity of enterprise CRM implementations, and the ease and speed of on-demand ones, I find it bemusing that the debate seems polarised around just the two options for small and mid-sized CRM customers – bloated expensive old enterprise CRM, or hot and happening, virtually cost free, on-demand CRM. It completely ignores the raft of mid-market CRM vendors offering on-premise solutions (or indeed applications that can be on-demand or on-premise) specifically designed for the needs and budgets of small and mid-sized businesses.

I’m not trying to pitch into the on-demand vs on-premise debate, suffice to say that both approaches have their strengths and weaknesses, and neither is universally superior in all circumstances. But I would just like to remind a few authors and analysts, that in the real world of small and mid-sized businesses, the real-life decisions are between the on-demand and mid-market vendors. The ‘armies of consultants’ story might make good marketing copy, but it doesn’t reflect the realities down in the trenches.

For good and evil...

I signed up with a web-based vendor of mailing lists a few months back. It was one of those stand-out experiences. The web site was slick and easy to use. I could profile the data to my hearts content. And, when I down-loaded my purchase, a customer services rep telephoned me to check everything had gone smoothly. Perhaps I’m just a bit sad, but it was the rare sort of experience you can’t help enthusing about and feel driven to tell others. A seemingly perfect virtuous marketing circle – great product, resulting in enthusiastic customer advocacy.

Fast forward a few weeks and I receive an email from the mailing list vendor with a list of other potential offerings. Nice touch I thought. Here’s a company that really knows its stuff when it comes to marketing. Against each offering in the email was a link to get more information. I clicked. The phone rang. It was the mailing list company. I’m not sure the exact pitch but the conversation went something along the lines of ‘you clicked on the link in our email. What would you like to buy?’. Now I don't know about you but while I had grudging respect for the technology and business processes that make this sort of approach possible, I also feel there’s a fine line between being attentive and stalking. I curtly ended the call and vow never to open another email from them.

Fast forward a few more weeks. I make another purchase. There’s a problem with the data I’ve down-loaded. I call customer support. It’s apparent that they aren’t very interested in resolving the problem. I make a few more abortive attempts to resolve the matter. No joy. I’m no longer an advocate. I’d now crawl ten mile over broken glass just to have the chance to dissuade potential customers from using them. And I’m no longer a customer.

I guess the morals of the story are 1. Be careful how you use technology. It can be used for good as well as evil. 2. Even with the slickest sales and marketing processes the overall customer impression will only be as good as the weakest link.

The world's favourite CRM package...

There’s one package that dominates the CRM space, and it’s not as obvious as you might think. I’ll give you a clue - it’s from Microsoft. No, not Microsoft CRM Dynamics, no, not Outlook, but you are getting warmer, no, the out and out market leader has to be…..wait for it - Excel. Take most organisations and look at the where customer and prospect data is stored and you will often find it’s scattered across a myriad of spreadsheets, on PC’s, lap-tops, and servers throughout the organisation. It can be a real eye opener to tally up exactly how many Excel data sources you have in the business. It’s also a good yardstick as to how well your current CRM system is functioning. It it’s working well, Excel data sources should be minimal, if it’s failing they are probably growing exponentially.

In the long run...

As has been well documented here and elsewhere, the path to a successful CRM project is strewn with traps and pitfalls for the inexperienced and unwary. However for the minority that navigate these successfully there’s one final ‘gotcha’ that seems to trip up more than its fair share of would be successful implementers, and that’s a failure to treat CRM as an ongoing programme, rather than a one off project. What we need to be mindful of, is that the value from the investment in CRM occurs over time, rather than at the point the system goes live. It’s the point from live onwards where the money gets made. Or should be, in reality this is often the point that systems begin a rapid journey towards premature obsolescence.

One of the biggest reasons for this is a failure to accurately budget for the life of the system rather than for the short term cost of the project. They buy the car, but they haven’t the resources to put petrol in it or maintain it. For CRM systems to flourish there are a number of resource hungry things that need to be happening – the system needs to be carefully and diligently administered, new staff need training, existing staff need hand-holding, user adoption needs to be relentlessly monitored, processes will need to change and evolve as the business itself changes and evolves, new features and capabilities will be required, upgrades will need to happen, the system needs to be supported, etc., etc.

These etc., etc’s don’t come cheap. They take time and money, but they are what makes the value flow. Here in the UK there was an ad campaign with the strap line something along the lines of ‘a pet is not just for Christmas’ highlighting the plight of many household pets whose owners had not thought through the time and cost of keeping and feeding them. I doubt it’s going to be a new government campaign, but a lot of organisation could save themselves a lot of trouble if they were mindful that a CRM system isn’t just for Christmas either.