CRM On The Cheap: 5 Strategies That Backfire

Your company knows that it wants a serious CRM system. But the CFO, nervous about the costs, starts to suggest strategies that could keep things under control.

Meanwhile, you know the implementation team has some ideas that go in a completely different direction.

How can you manage executive expectations that may be based on misinformation? This two-part article will cover common traps that you should avoid, followed by advice on the best ways to save some real money. Although the article focuses on Salesforce.com, nearly all of the advice applies to any modern SaaS CRM or SFA system.

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Your company knows that it wants a serious CRM system. But the CFO, nervous about the costs, starts to suggest strategies that could keep things under control.

Meanwhile, you know the implementation team has some ideas that go in a completely different direction.

How can you manage executive expectations that may be based on misinformation? This two-part article will cover common traps that you should avoid, followed by advice on the best ways to save some real money. Although the article focuses on Salesforce.com, nearly all of the advice applies to any modern SaaS CRM or SFA system.

Bad Strategy #1: Believe the Illusion of Forever In your computer science studies, the focus was on building industrial strength systems that would stand the test of time. This perspective is totally inappropriate for a CRM system and leads to a series of progressively expensive mistakes.

The reason: the business requirements for a CRM system are likely to change so radically over time that the system design life will be less than 5 years. In some industries, the tenure of a VP of Sales or a CMO is only 18 months, and even a CEO change is likely every few years. With each new leadership change will come shifts in market strategy, sales tactics, and product line emphasis. New regulations come into play, and new partnerships become important (or not).

Everything you "designed in" the system at the outset is likely to become irrelevant or counterproductive years later. Even if you were to stay with the same CRM platform over time, there are good reasons to re-implement the system from scratch after 5 years.

This short design life means you need to get the business payoff out of the system quickly. The payback for the investment should be less than 18 months in most cases-and any benefits projected beyond 5 years should be discounted almost entirely.

Of course, you don't want to have a throw-away system that is too fragile to survive the inevitable revisions. But it's a big mistake to over-engineer your CRM system, the scope of data to be imported, and the range of external system integrations. Perfectionism doesn't pay.

Bad Strategy #2: Too Many Goals When you're an IT pro selling the organization on the need for the potential benefits of a CRM system, it's easy to fall into the trap of "happy ears." Everyone hears what they want to, and the expectations for the system ratchet skyward. Even if you could delver on all the individual expectations, the total cost of the project will be laden with waste.

The problem here is a cacophony of goals-unprioritized, politicized, often contradictory or even impossible-that leads to a project that is ill-defined and hard to execute. Expensive areas of the project aren't well enough defined in terms of business process or business champion, so the project team flounders. Other areas of the project may not be well enough defined in terms of the economic payoff, so there's nothing in the numerator of the benefit-to-cost ratio.

Better to have a very small number of goals for the system, each with a clear owner, metric of success, and deadline. Every goal should be prioritized, with no ties. After you've registered some quick wins that demonstrate results and get users committed to the system, add the next one or two goals as you build the system out incrementally.