CRM Unplugged: Releasing CRM's Strategic Value
Excerpted with permission from "CRM Unplugged: Releasing CRM'S Strategic Value," by Philip Bligh. Published by John Wiley & Sons, Inc., April 2004, ISBN 0471483045. For more information about this book and similar titles, please visit www.wiley.com.
A Review of CRM Failures
CRM failures have been costly, disruptive, and embarrassing. Red
ink, shareholder losses, upset customers, lost market share, lawsuits, and
career setbacks are all typical outcomes of CRM failures. Several such
failures have been publicly documented as companies have cited CRM
problems for performance shortfalls during earnings announcements.
In this chapter, we have collected some of these stories. Obviously,
few companies are willing to detail failed initiatives but the information
available provides strong indications of patterns of failure. In
addition, the authors have personally seen the aftermath of many situations
where initiatives had gone awry and these experiences,
together with the documented failures, provide an eye-opening dossier
of reasons for failure. Ultimately, the mistakes of the past will help to
set the proper expectations and goals for the future.
The cost of CRM failure is dramatic and can take its toll in many
areas of the business. The following summarizes the typical impacts
by category:
Financial Performance
Market share and operating losses
Failure to achieve a return on investments
Budget overruns
High post-implementation running costs
Customer Service Quality
Customer confusion, frustration, and dissatisfaction
Lower service levels
Slower time to market
Negative brand perception
Sales Effectiveness
Lower sales force productivity
Increased sales force cynicism toward new systems
Increased sales force turnover
Cultural Impacts
Low morale within IT and affected departments
Growing cultural cynicism within the company toward
adopting business change
Company-wide loss of confidence in its ability to enact
change
Lost jobs in the executive suite
Propensity for companies to become overly conservative
with regard to investments in strategic initiatives. This
leads to dampened innovation, a failure to strengthen
advantages, and deferring the update of aging processes
and infrastructure
Read the rest of this excerpt and download Chapter 2: A Review of CRM Failures
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