Vendors are ultimately responsible for CRM failures

Vendors – not customers – are ultimately responsible for CRM failures. There was so much hype around the technology in the late 1990s that it was almost impossible to meet inflated customer expectations. CRM providers must take responsibility for making ambitious promises that were simply impossible to keep.

Vendors – not customers – are ultimately responsible for CRM failures. There was so much hype around the technology in the late 1990s that it was almost impossible to meet inflated customer expectations. CRM providers must take responsibility for making ambitious promises that were simply impossible to keep.

Exacerbating the situation is the confusion between CRM and sales force automation (SFA). CRM and SFA are categories that have been wrongly lumped together. While SFA is designed to equip a sales force to close deals, it does not influence customer retention, an element that goes to the heart of the CRM agenda. SFA is about acquiring new customers, whereas CRM is concerned with identifying, servicing, retaining and increasing profitable customer relationships.

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This confusion has serious financial consequences. A successful CRM implementation maximizes profitable customer relationships and increases loyalty by transforming the contact center from a resource drain to a profit center. Many vendors ignore this important aspect of maintaining and growing customer relationships when selling CRM software. But the multi-channel contact center represents a major opportunity for extensive reduction of costs and increase in profits. In the contact center, vendors must provide clear action items for agents based on customer insights to achieve high productivity.

Another concern is that many CRM vendors simply throw technology at customers’ problems and walk away. Instead, vendors must use a combination of in-depth vertical knowledge, a sophisticated professional services team and industry-leading software to develop solutions that work. And vendors must commit to customer satisfaction with any CRM implementation – even assuming some of the responsibility.

Companies always will look for ways to make customer relationships as efficient and profitable as possible. It’s not about ERP, SFA or CRM – it’s about a different approach to the market, and customers are demanding it. Vendors must show commitment by seeing implementations through from inception to ongoing ROI calculations.

One of the greatest challenges companies face in this context is the increasingly sophisticated and complex task of integrating and automating business processes. Linking these systems and automating the end-to-end processes that touch customers, employees and external systems is one area in which businesses find the value of CRM investments. What this all boils down to is that vendors are responsible for helping customers achieve a fully integrated enterprise network and solid business results from their CRM implementations.

While it is currently popular to highlight cases where CRM has failed, the most important aspect of fulfilling the promise of CRM lies with the vendor, not with the customer. A higher level of vendor commitment is the missing ingredient.

Pockard is president of the ClarifyCRM division of Amdocs, a billing and CRM software vendor in San Jose. He can be reached at drorpo@amdocs.com.