At its core, customer relationship management is a strategic approach to understanding, measuring, and extending the customer-business lifecycle. As much as it involves technological innovation in the way customer transactions are monitored and in the way sales teams perpetuate the use of new data, CRM is typically implemented by mid to upper-level managers whose main concern is profit, which is sometimes treated as an outlying force that is disconnected from the subtle intra-business communications and interactions that make it possible.
Profit is important. But there is something even more essential, more fundamental, to business success than making money–and that is replicability. It could be the replicability of a specific sales process, or of a selling strategy that only proves to be successful among a certain customer base after rigorous testing and empirical data collection. It could be the replicability of a customer acquisition strategy or of an internal feedback loop from sales to product that generates a better, more streamlined experience for customers.
In order to capitalize on the benefits a CRM system, sales leaders need to make absolutely certain that they have a plan in place to measure its effectiveness before the point of implementation. This doesn’t mean only looking at the total number of customers, or the total amount of profit, before and after implementation. It means looking more deeply. It means looking at a tiered ecosystem of factors that will be influencing the amount of sales that a business with a robust CRM solution achieves.
If a sales leader is only looking at profit when a CRM strategy is adopted, how will he or she diagnose a problem if numbers begin to fall? A good CRM system will inevitably come with analytics that allow leaders to look more deeply into the individual performance of specific members of the sales process, but does this information tell a business leader anything about an increase (or decrease) in effectiveness of the overall business as a result of implementation?
Profit is one thing. Efficient profit is an entirely different beast.
Considerations for CRM Efficiency
A few domains to consider for measuring efficiency include:
Is the person making the CRM choices an expert about the effects it will have on the employees using it? Has this individual tested the CRM system themselves? Have they spoken with the employees who will be using it to identify their needs, rather than focusing only on the needs of upper management? Has this individual done everything they can to minimize lack of adoption among a sales team by ensuring that training material is easy to understand, available, and proactively supported? A sales team just isn’t going to adopt a CRM program that requires so much training that it negatively impacts their ability to sell during an extended ramp-up period. Also, new training regimens need to be integrated into future onboarding, so they affect hiring as well.
Departments that don’t share product data are doomed to make avoidable mistakes. Is there a plan in place to measure the effects of more efficient data capture between departments? For example, does an engineering team improve its ability to add features to a product more quickly when it has more active communication from the sales team about what customers need? Does the CRM system make it easier for this communication to happen on the fly, leading to smoother product releases?
Increasing complexity of the sales process
CRM systems that are well thought out and carefully researched should reduce the complexity of the sales process, right? Not necessarily. A company may find that layering a technological CRM solution onto a sales process creates new protocols that change the way a sales team operates. In some cases this change might actually increase the complexity of the sales process in order to make better use of new customer data. Always watch the overall sales pipeline. An increase in complexity is not necessarily bad, and in fact may lead to transformative product alterations that over time generate more money.
Reduction of meeting time
Meetings eat a lot of time among company employees. How much time do people spend in meetings after the CRM is implemented? If there is a significant reduction due to more efficient reporting, where is that saved time actually going?
Are your customers more satisfied as a result of the implementation of a CRM software? Why? Does this increase in customer satisfaction demand nurturing that ultimately costs a company money?