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How to read a CRM Proposal

Mai 5

Gepostet von David Duncan in CRM Projects | Keine Kommentare

Reading a proposal for a CRM solution may sound easier than it is. Suppliers may supply visually attractive documents loaded with text or limit their offer to a bare description of the project steps and prices. Of the two extremes, the second has distinct advantages. Long texts may look good, or may even make interesting reading, but have the tendency to hide the really important facts amongst the many trees in the wood. The shorter texts are easier to read and have less danger of embedded pits.

No proposal can contain a full description of a standard product, the information can be found anyway in product documentation which should be supplied or form part of the proposal. The document must contain a full description of the project steps, all costs related to the project, and what happens if parameters change during the project. If the standard product is to be customized, then a detailed description of the modifications must as a separate document be identified.

Many companies underestimate their requirements. Functions are either overseen because they are part of everyday routine or because it is assumed that they are naturally part of a standard solution. This makes life easy for suppliers to make a low bid, well knowing that there will be no difficulty in changing the terms of the contract later when the hidden processes are unveiled.

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Preparing a Request for Proposal

Apr 20

Gepostet von David Duncan in CRM Projects, CRM Software | Keine Kommentare

In the past few years, I have been responsible for evaluating an immense number of RFPs for CRM systems of all shapes and sizes, a necessary but often frustrating task. Why frustrating? The RFP must be constructed in such a way that product differences really become visible. This is very often not the case. Several approaches are recognizable.

  • The RFP has been prepared by external consultants who have a clear interest in a particular product, but need to make their recommendation appear objective (frustration level high)
  • Consultants have been involved who do not have vested interests in a product but prefer a solution which enables them to continue consulting while the product runs (frustration level medium)
  • Consultants have been involved who are assisting the company to find the best fit solution as objectively as possible (excellent but seldom, no frustration)
  • Listing all possible CRM functions in order to choose the product with the most functionality (frustration level high, since most suppliers can tick the boxes with a little imagination)
  • Describing the current situation and asking for suggestions (frustration level low, but usually difficult due to lack of adequate information)

This sounds hard on consultants, but to be fair, the selection task is not easy. Recommending a product without product experience is risky, but at the same time experience cannot cover all products available and will limit the choice to a small number of major suppliers. Most suppliers will form an opinion regarding the type of RFP and will invest effort accordingly. In order to receive a maximum of information, the RFP must not be weighted towards a specific solution and must allow comparative strengths and weaknesses of suppliers and products to appear.

 A good RFP will contain a clear statement of the current position, the reasons for the introduction of a new and will ask for information on

  • Technology
  • Functionality
  • Interfaces
  • The manufacturer
  • The project partner
  • Project methodology

In each section questions are separated into “must have”, “should have” and “nice to have” questions. This is not so easy as it sounds, since most products allow customization which makes it difficult to make a yes/no answer possible. A “must have” could be for example an interface to Lotus Notes. The above list will be extended in much more detail in later posts.

Better than a list of functions is a list of business processes with a brief description. This enables suppliers to take a clear position. Take care to ensure that each step in a process is simple enough to allow a simple answer. Details follow in the next posts!

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CRM Selection – after the Project Brief

Apr 13

Gepostet von David Duncan in CRM Projects, CRM Software | Keine Kommentare

The project brief should clearly state the aims and the focus of the CRM Project. It will be designed for internal use and will not be a basis for the pre-selection of possible suppliers and may not even provide “Make or Buy” guidelines. Admittedly, no-one today seriously attempts to go for a “Make”, so this is more theoretical.

Where does this piece of string start? Is it a good idea to look at available products and  see what may be of use, or is it better to examine the user requirements in relation to the project brief? Though it can be helpful to have a rough idea of what CRM-Suppliers have to offer, there is for me no question that the starting point is the requirements analysis.

Most suppliers will offer lists of functions. Not surprisingly, these lists will be very similar, allowing only the distinction between “smaller” solutions (cobra CRM PLUS, CAS Genesys World) and “larger” solutions (Oracle, SAP, Pivotal, Microsoft, Salesforce). Within a group of similar products, what really differentiates the products is the ability to realize and support specific business processes. A seemingly simple requirement, such as the need to have different data entry masks for company data depending on user login, can put some players off the screen. These differences only become visible, when the required processes are known and defined.

The starting point must be the definition of the required processes in adequate detail to reflect the way in which users will work. There is no need to fear that this will result in requirements which no supplier can fulfill. Sales, marketing and support processes are common to most companies. The way in which these processes are implemented is however very different from company to company and is absolutely critical for the future application. These differences make companies individual.

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The CRM Project Brief

Apr 12

Gepostet von David Duncan in CRM Projects, CRM Software | Keine Kommentare

It is frequently stated that a large percentage of CRM projects fail. That is something which I cannot confirm in my own experience, but I have found that very few projects have clearly defined aims. This places the Project Manager and the Steering Committee in a tricky position as there is no way of setting realistic milestones and checkpoints. This could be the subject of a book, but to keep this post readable on this blog, here is simply of list of quantifiable and controllable possible goals for a CRM Project, assuming that the scope of the project and the resources available are also defined. This list relates to B2B projects.

Internal Considerations

  • Leads
    • Decreasing the cost of lead generation by improved marketing efficiency
    • Reducing the time and effort required to qualify leads
    • Improving the qualifying process and the conversion rate of leads to opportunities
  • Sales
    • Reducing the time sales persons require for administrative tasks (activity planning, writing visit reports, producing proposals etc.) and information searches
    • Improving the communication between internal and field sales
    • Reducing the effort required to organize or re-organize sales areas, sales teams
  • Activity Management
    • Individual users will not directly benefit from CRM Activity Management, the advantages are in team work and communication. The advantages to be defined relate to improved communication and reduced overhead.
  • Opportunities
    • The value of opportunity management is frequently overrated, but there are efficiency gains to be made for sales management.
    • The use of sales strategies (Target Account Selling, Miller Heimann) can be supported by a well designed CRM System. However, more important than the creation of data entry forms is the way in which the strategy is lived by the sales force. CRM can only support this process by reducing the administrative overhead (see “Sales”)
  • Marketing
    • Operational Marketing (I would like to patent this term) can be simplified using CRM Software for Mailings, Event Organization (Invitations etc.) and by linking campaign and lead generation processes. This needs to be carefully designed.

External considerations – the real CRM objective

All of the above relates only to internal improvements. Most important though is that customers should feel the effects of a new CRM System. They should find well informed contacts and be impressed by the ease with which staff deal with any kind of situation. In my opinion this should be the real reason for installing or improving a CRM System. Here quantifiable goals could include service quality, customer satisfaction, speed of delivery and customer retention.

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The CRM Business Case

Mrz 30

Gepostet von David Duncan in CRM Projects, CRM Software, ROI | Keine Kommentare

When replying to an RFP, I used to ask for a statement of the business case in order to supply more accurate, customized data. Why did I stop? Because I never got an answer. It seems that many companies interested in CRM tend to look for the CRM product which has the most functions for the money the company intends to spend. That this completely disregards the costs of customization is a basis for a later post, here the question is, “what should a business case statement contain?”.

Two groups can benefit from the introduction or replacement of a CRM solution, customers and users. Users can gain by increased personal and team efficiency, while customers should benefit by improved and smarter service, leading to reduced costs in the first case and higher sales in the second.

It is never easy to quantify the benefits, but not impossible. In the case of users, the possible benefits differ according to the user role.

Sales person

A good sales person will have organized his/her work with his own methods or tools. Do not look for monetary benefits in this area.

Sales Teams and Sales Channels

Whereas sales persons can organize their own work, they often are not good at sharing information with other team members. By improving the information flow within a team, selling time can be increased. The saving will depend on the specific situation, but could well be around 10%. Time saved does not always result in more sales activity, so this needs to be analyzed.

Marketing

Major savings can be made by reducing the effort required for serial letter or e-mail campaigns. This can lead to time savings of up to 25% leaving capacity for other tasks or for more intensive campaign work

Management

A well set-up CRM system will allow managers to analyze and guide sales activities and will provide data for strategic planning. Managers must estimate the worth of information for their individual situation.

Customers

Customers should experience higher service levels after introduction of a CRM System leading to higher satisfaction. Sales income is dependent on a number of factors so the effect of CRM activities on turnover cannot be directly measured. Customer satisfaction levels should be measured before and after the introduction of a CRM System. A more satisfied customer may or may not purchase more, but an estimate should be made on the basis of historical information.

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How to find the right CRM software

Mrz 29

Gepostet von David Duncan in CRM, CRM Projects, CRM Software | Keine Kommentare

 The process of selecting CRM software has been discussed and described many times and in great detail. My recent experience has been however, that there are some basic and simple guidelines which are often ignored. Projects do not necessarily fail as a result of this, but many projects are much more costly than they need be and user satisfaction is often not as good as it might be. My next posts will handle these topics.

  • The business case: Can my company benefit from a first or replacement CRM system?
  • The project brief: What must the project achieve?
  • Project organization: Who should be involved in the project?
  • Researching the market
  • Preparing a RFP, defining the requirements
  • Working with consultants
  • Creating a short list
  • The final choice
  • Design and Programming Specification

Keep watching!

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CRM and ROI

Mrz 26

Gepostet von David Duncan in CRM Projects, ROI | Keine Kommentare

Hans Thomann, owner and Director of the largest dealer in Europe for musical instruments and just about everything a performer needs says

For me, investment must always have a purpose. We must serve our customers faster or offer more service and help to our customers

This is my free translation of the original German text in the Frankfurter Allgemeine Zeitung of 20th March 2010 and just about sums up what CRM is all about. Unfortunately, many projects are started with only a rough concept of the business aims. Too often, the concentration is on internal communication, which is an means to an end, but not an end in itself.

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Integrating B2B CRM with Social Networks

Mrz 19

Gepostet von David Duncan in CRM Software, Customer Relations, Social CRM | 2 Kommentare

What prospects and customers look for:

  • Information on potential suppliers and their products
  • Relevant comments and reports from other users
  • Supplier independent discussion platforms

What B2B prospects and customers do not want is a sales pitch, for that they can go to the suppliers web site. Many groups in XING have mutated to sales platforms, which is not what social networking is about.

What B2B suppliers want:

  • Background information on persons involved with purchase decisions
  • Visibility resulting from discussions and comments
  • Market background information
  • Real-life contacts resulting from social network activities

These requirements are not incompatible, but there is a numbers problem. While individuals looking for information can research on a specific topic when interested, suppliers need permanently to monitor these activities. Also the number of people gathering information will always be considerably higher than the number of employees available for monitoring social sites. The effort involved in monitoring is immense.

Evidently, there is a need for automating these processes, which is where CRM software comes in. As may be expected. Salesforce as a cloud oriented supplier has announced several functions, most of which are still in development. Other companies, Pivotal for example, have announced plans for integration with twitter, linkedIn and facebook. The solutions offered are oriented towards gathering information, which is fine but is only a time saving function for sales and marketing personnel who would otherwise research the information directly.

After saying that automation is required, there are some major challenges to master. Firstly, the amount of information available is considerable and only a small part of the information available will be relevant. Secondly the behavior of people active in the social web world is changing rapidly and there is no reason to suppose that this will change during the next years. Finally, marketing gurus will say that there must be a dialogue between suppliers and the outside world. All this makes automation more a dream than a realistic aim

Common to B2B and B2C is the aim of steering people to the company web site, assuming of course that the web site offers support,  forums, customer information platforms and order processing. At this level, processes can and should be automated.  The message I am getting to is this. CRM B2B applications may be loosely linked to social sites, the really import interaction is that between the CRM solution and a modern, functional internet presence. 

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Activities and Workflow

Mrz 12

Gepostet von David Duncan in CRM Projects, CRM Software | Keine Kommentare

Sales activities may not require complex workflows, but much time can be saved by standardizing routine tasks such as

  • sending or mailing product information and follow-up
  • creating a proposal, authorization (if required) and follow-up
  • planning a demonstration or presentation and follow-up

These and similar processes have many things in common. They require interaction with others, colleagues and customers, they require some kind of resource and time management and always  require follow-up. The latter is as every sales person knows essential, but also the most difficult to plan.

While all CRM solutions offer activity and appointment planning tools, usually integrated with Microsoft Outlook or other Groupware, not all provide workflow tools. Solutions available are of differing quality.

A good solution will allow tasks to be defined and linked, assigned to users of groups and given start and end times and will preferably have a graphical design tool. Once an instance of a workflow is started, it must be possible to change the planned sequence at any time or to jump from one workflow to another.  A prospect who has received a proposal may for example request a new presentation which may again lead to a new proposal.

Further the workflow solution must allow for multiple alternatives for the display of open tasks, for example by user and date, by customer, by workflow etc.

The processes may appear simple, but practice shows that even these simple processes are always unique to each company and often to groups within the company. This often neglected area can help reduce costs while increasing the efficiency of sales persons and sales organizations.

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Groupware vs. CRM

Mrz 8

Gepostet von David Duncan in CRM Projects | Keine Kommentare

Most users of CRM system use Microsoft Outlook or some other groupware in combination with a smart phone of Blackberry to plan their activities. While some of these activities are directly CRM-relevant, not all are. My wife’s birthday is important to me, but probably not for my colleagues and customers.

Yes, most CRM applications do have good integration with groupware, but this does not entirely solve the problem, because users do not want to clutter their hand-held devices and calendars with activities which are only relevant when in the office. In all the projects I have been involved in, this has been the first issue to be faced when the application goes live. i am not even going to attempt to suggest a solution. However, good solutions will always offer users a number of ways to organize their work, so individuals can work in the way that suits them best.

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