11 ways to limit CRM implementation risk...

So you’ve been given a CRM project to deliver. How do you manage the risks associated with managing an implementation on time and on budget that also delivers value to your organisation?

Understand there is complexity. A lot of money has been invested by the CRM software industry in promoting the idea that CRM is straightforward. If people didn’t believe implementing CRM systems was easy, they wouldn’t buy much software, and that’s not what the software industry wants. While it’s by no means rocket science, there is considerably more complexity involved than people appreciate. If you get lulled into seeing this just a technology selection issue, you’ll get tripped up.

Write a tight and detailed requirements specification. A tight specification of requirements is the foundation for a well controlled project. The key word here though is detailed. It’s not hard to wander round the building asking people what they want from the system and in the process accumulate a reasonable number of bullet points, but this sort of list is not going to help you manage a project. A requirements document should thoroughly address:

• What problems are we looking to solve?
• What are the business processes required to solve the problems?
• How will the processes work within the technology?
• What are the supporting functional requirements?

Ideally you should be creating a detailed design for the system well in advance of selecting any technology. This enables you to:

• Reduce the risk of purchasing an inappropriate technology
• Get a firm price upfront from potential vendors allowing you to purchase competitively and reduce the likelihood of unexpected costs downstream
• Reduce the risk of ‘scope creep’ where new requirements keep being added during the implementation phase causing delays and budget overruns

Create a sensible project plan. This isn’t as simple as it might seem. It’s human nature that while we may have been contemplating deploying CRM for many years, once the decision is made to progress there’s a desire for instant results. Consequently it’s easy to be hurried into an unrealistic project plan. In principle you should be able to look to the vendors for sensible guidance in this respect, but in 14 years in the industry I’ve seen remarkably few realistic plans. As a rule of thumb take the time-lines the vendor gives you, add 50%, and you shouldn’t be too far away.

Choose your vendor carefully. Technology and vendor selection may not be the most important constituent of a successful project, but it’s still important. Good requirements definition will help you understand what you need from your software, but it’s also important to assess the longevity of the options on offer. There’s plenty of vendors I can think of that I don’t expect to see around in a few years time, either because they are new and will struggle to get traction in the market or because they are at the end of their project lifecycle and are milking the last out of a cash cow product.

The other dimension of this is that many CRM technologies are sold through a network of implementation partners. These tend to be smaller businesses, with an even higher mortality rate, so due diligence here is just as essential. The last thing you want to be doing is abandoning a perfectly good system after eighteen months because your chosen vendor got bought out and the new owner pulled support of the technology, or through some similar doomsday scenario. You can’t remove all risks, but I strongly recommend sticking to established, successful technologies unless there is a compelling reason to do otherwise.

Ensure you have the resources in place. CRM projects are time-consuming. People have day jobs. The two things don’t sit well together. You need to understand the resource intensive aspects of the project. Activities such as project management, data preparation, system configuration, testing, and training are often more resource intensive than people expect. It is also particularly important that senior management have the bandwidth to support the project, because the project is unlikely to succeed without their active backing. By examining the resourcing needs carefully you can head off potential bottlenecks that can considerably delay a project.

11 ways to limit CRM implementation risk is concluded in the next post…

A surprise at 43...

BusinessWeek adopted a rather surprised tone in its commentary on number 43 Amazon in the '100 best global brands' issue. It notes Amazon is both the fastest mover in this year's ranking, yet spends virtually no attention on advertising, preferring to invest in technology and distribution capability.

I think this just reflects the new reality that with the fragmentation of media, and the ease with which views and opinions can be shared across the web, the key battleground is the customer experience. Gone are the days that you can fool people into believing you have a great product by investing heavily in TV advertising. Sadly perhaps for the ad agencies.

Marketing resource management software

Nice piece on Gartner's take on marketing resource managment MRM software in SearchCRM.

Sticking to the knitting...

Many, many years ago, in my pre-CRM days I worked for the incumbent PC supplier to a very large financial services company. One day alarm bells started to ring. Our customer was evaluating another supplier. We knew where: behind locked doors in the basement. But who, was a mystery. Our polite enquiries were stonewalled. But by using some subterfuge or other we eventually gained access to the test facility, and there on the test benches we saw banks of desk-tops and servers, from a company called….what does that logo say? I can’t quite make it out…. D-E-L-L. Who the heck are they?

In the fullness of time we lost the account to Dell, and in the following years I’ve marveled at the ruthless efficiency of their business model. Machines, only available direct, built to order, payment received up front, no need to carry stock, perfect. They went from Michael Dell’s dorm room to dominate an industry. Even I became a loyal customer.

But acquiring Perot Systems? I can see the logic perhaps. The PC industry is slumping and services suddenly look a very attractive area. But the question is when does a unique position in the market become everyday? I can already buy Dell from PC World, and now they are an outsourcing giant as well? I’m not convinced this is going to work. When you start to look like every other global IT company why should I buy from you and not the others? Sometimes it’s better to understand what you do well and stick to it.

The rise of the CRM architect...

Once upon a time when people wanted something built they went to their local builder. At some point in history though, people found this wasn’t working so well. Builders might be great at building, but they weren’t so great at designing buildings and the role of the independent architect was created.

Today, if you want to a new office built, you find a suitable independent architect and they will interpret your needs, create a set of plans which prospective builders can accurately quote against, help you select the right builder, and oversee the project to check your vision is realized on time and on budget. This seems to work well and is the accepted way of running a successful construction project.

I think there’s a close parallel between how the construction industry changed and how the CRM industry will evolve. If we look at the CRM market today it’s apparent we’re still in the pre-architect era. If you want a CRM system, in the main you go to a CRM vendor. This is fine if the approach worked well, but I think realization is setting in that vendors may be pretty good with their technology, but applying it in a way that adds value just isn’t their forte. In tougher markets this situation seems unsustainable.

Independent CRM consultancies like ourselves have been performing the ‘independent architect’ intermediary role for some time, but this approach has been the exception not the rule. I think things are changing though, and that independents specializing in implementation and operational best practices will increasingly sit between the client and the CRM vendor as a means of maximising value from technology. Whether we're still known as CRM consultants I don’t know. If it weren’t for the fact it’s a rather hackneyed IT term, perhaps CRM architects might be a better description, but, whatever the nomenclature ends up being, I think it’s the key to the power of CRM technology getting realized.