What Can We Learn from CRM Failures?

By Robert Moskowitz

According to a recent survey of hundreds of managers involved in a CRM initiative that failed to meets its initial goals, such a failure need not be a “career-limiting move.”

It appears that even a failed CRM program gives a manager valuable experience that often translates into broader capabilities and an enhanced career trajectory.

For example, many organizations launch several projects related to CRM at essentially the same time. This stretches the managerial and financial resources available to support these initiatives very thinly. The result: One or more of the CRM programs may fall flat.

But managers involved in such simultaneous CRM projects generally learn an important lesson: Enterprise-wide coordination is central to the success of CRM. Managers see firsthand that people from many different divisions with many different functional responsibilities must meet together often enough to prevent individual projects from undermining other projects, and to optimize the allocation of resources and the setting of priorities. Frequently, this kind of solid coordination helps hidden synergies to emerge and the whole CRM effort begins to accelerate.

In other situations, organizations fail to recognize that CRM requires changes in behavior among many – if not all – of the employees who interact with customers. Managers involved in these less-than-successful CRM projects usually come to recognize that installing new information technology is only one aspect of getting good results from CRM. It’s also vital to get a broad-based “buy in” from the people who must put CRM into action.

Since most organizations deal with a broad variety of channels, market segments and products or services, the simple act of managing and coordinating day-to-day customer relationships usually becomes exceedingly complex. Looking back on what may be a bitter experience, managers from failed CRM initiatives often discover that changing compensation and incentive programs to reflect the new behavioral goals and priorities is a key element of CRM success. These managers also recognize that successful CRM programs depend on high-quality training, long-term motivation, and management’s willingness to listen to and learn from front-line employees.