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CRM failure: The top six reasons CRM programs fail

Lior Arussy gives the top six reasons CRM programs fail in this expert tip.

I have heard that there are technology-driven and customer-driven reasons that CRM programs fail. Can you expand...

on this a bit? What are some examples of technology-driven and customer-driven CRM program failures?

CRM programs often fail because companies rush to buy CRM technology without fully planning for the strategic and operational changes required. Organizations think that the technology will do the work; when in reality, the technology is just a tool. If you know what to do with it, you will see great results, and if not, it will just be an expense.

Other reasons for CRM failure include:

1. Lack of change management – The company does not plan for change management, including the changes in user behavior required to adapt to the new tools.

2. Lack of executive leadership – CRM is sometimes passed off to middle management, and without active senior executive sponsorship, it does not take off.

3. Shortcuts mentality – The company does not plan for a long journey but rushes and stays at the "quick wins" level.

4. Inadequate user buy-in – The company does not adequately prepare users for CRM.

5. Unstructured relationship – The company does not clearly define what is expected from customers as part of the new CRM program.

6. Failure to operate the CRM program – The company does not turn goals into measurable actions and institute them across the organization.

This was last published in June 2008

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