CRM White Paper: 10 Stupid Reasons Companies Give for Not Buying CRM

Poll 100 managers of IT, Sales, Marketing and Customer Service and you will get 99 reasons why they can�t, won�t, or shouldn�t invest in a CRM solution for their company. The 100^th individual will say, "This is a no-brainer!" and buy the CRM software.

Why? Because they don�t understand!

Read on to see the ten most common reasons that companies give for not considering a Customer Relationship Management (CRM) solution. I understand the variety of well-intentioned reasons for not listening to a CRM sales call or for tossing a CRM direct mail piece into your circular file. But, so often companies don�t know what�s good for them!

Consider a personal example: If a financial consultant calls your home to present his services, should you listen? I am very glad I did! I was trying to manage my own retirement planning with my limited knowledge and no time to develop expertise on the financial markets where I should invest.

The service I signed up with got me into more secure real estate investments, better mutual funds and reduced my investment expenses. I am much more confident that I�m headed down the right path to retirement, and it�s not costing me a dime out of my pocket! The firm works off investment commissions and has done a great job!

Is there a CRM solution out there that will allow you to cut costs and grow your portfolio? I bet there is! If you aren�t willing to listen because you don�t have the money to buy new software or the people to install it, etc., etc., etc. . . Then you may be making a very shortsighted decision.

It could be compared to a car that is nickel and "dime-ing" you to death, but you haven�t stopped to add up the costs. Maybe a new (or later model used) car would actually perform better and save you money! With a little bit of research, you can determine if the timing is right for CRM, or if you�re better off doing it the way you do now.

Let�s look at the Top 10 Reasons companies give most frequently:

1. We don�t have a budget for CRM.

While budgeting is an important part of planning for a company�s future needs and allocating resources to the right priorities, who knows on the day the budgets are approved, that the chosen expenditures have the greatest impact on the bottom line. Things change! In two, or six months, solutions become available to solve problems you never dreamed of!
If a CRM solution could pay for itself in three months, who needs a budget? I would hope your management could find away to fund this, even if they need to finance it. If they can�t, why not? Does the controller needs to get involved to educate the management team on the future payoff of a solution that can pay for itself in three months?
Is someone in charge of looking for technology solutions that can grow your business? Empower someone and let him or her find solutions and put those solutions in the budget! What do you have to lose?

2. Our IT staff is too busy with other projects to work on a CRM project.

Who is setting priorities here? Are decisions based on the impact on revenue or how much time and money the project will save? Do you even know how much time or money it will save? How will a CRM project contribute to the sales growth that your company desperately needs? Priorities are key to the growth of your business!
Some CRM solutions can be installed with very little help from your in-house IT staff. If little IT staff time is needed, this is a weak excuse. Sometimes it takes very little additional money to have more of the installation and integration done by outsiders or the CRM vendor, while actually saving time, money, and frustration in the long run. Weigh all the options before using this excuse.

3. We have no need for a CRM.

This has got to be the stupidest response! OK, I understand that you don�t like salespeople calling you and asking questions, but how does your own company sell its products? If they sell by phone, then cut these poor CRM salespeople some slack! If you�re the right contact, listen to the caller for 30 seconds before hanging up. If you're not the right person, refer them to the appropriate co-worker (or one who deserves a practical joke.)
If you truly think your company has no need for CRM, then you must understand all of the facts around the following:

1. Software applications currently used by sales personnel
2. Sales activities, documentation, communication and coordination with other departments

3. Understand all of the interactions between sales and other departments: Accounting, Customer Service, Production, Inventory Control, Management, HR, Legal, Contracts, Strategic Alliances, etc.

4. Understand the sales process and sales cycle intimately, so you can judge which processes waste customer time, salesperson time and the time spent by all other departments in support of the sales effort.

5. Salesperson turnover rates, what companies they ultimately leave your company to work for, and security procedures and policies in place at your company for current and departing employees to keep your customer records out of competitors� hands.

6. Ordering procedures of inside and outside sales people, when and how salespeople place orders for products for their customers, as well as the ability for the salesperson to advise the customer on status, delivery, back orders, etc. to keep and grow customer loyalty.

7. Understand the functional areas and contacts within each prospect and client company as well as interrelationships between companies and their parent companies, subsidiaries and branches.

I think you get the idea . . . if you don�t fully understand the selling process and the people, processes, systems, and information involved, how can you be in a position to judge whether a solution is needed or not?

4. We�re waiting for economy to turn around.

What? Don�t let the President hear you say this! Any employee that is waiting for the economy to turn around better tune up their resume! If you�re waiting versus trying to find new ways to increase market share and earn more business from existing customers, you may want to rethink your strategy.

I would venture that you are not considering technology solutions, such as CRM that can steer salespeople to new prospects and educate all sales personnel about opportunities for cross-selling and up-selling that your company is missing right now! And the payback could be very short, from a few weeks to a few months. But how do you know, if you�re not looking?
Someone is still getting the business in your industry . . . Why shouldn�t it be you? Do you want to let your competitor keep his share of the business and you keep yours? Why can�t you try to earn a bigger share of the customer�s purchasing dollar by providing better service, being more aggressive or cross-selling other products?

Could it be because you or your salespeople don�t have the right information to understand these opportunities? If you don�t have the right CRM solution in place, it is VERY likely you are missing many opportunities!
How do you know that some of your customers aren�t buying more, from your competitors? Are your salespeople aware of their customer�s "share of wallet" with each of their accounts? How do they communicate this to the inside sales people or customer service reps? How? Is it on a computer screen in front of them? Could it be? What value would this have to all employees who deal with customers? Could they help address opportunities and win incremental business?

5. We don't have traditional customers.

So, does this mean that they will like you no matter what you do? Or that if their salesperson (at your company) for 10 years moves to your competition, that they will still buy from you? I doubt it!
CRM helps you keep control of your customer information, and track opportunities and activities with customers to better service them from all fronts — sales, marketing, customer service, etc. It doesn�t matter whether they buy once a year, over the Internet, or with orders written on a napkin, it pays to store all customer activity records in one place and where all of your employees can better service your customers with knowledge of who they are, what they want, and when, where, and how they want to get it.
Show me an untraditional customer who does not want to be serviced well, and I�ll show you a company that is losing market share to its competitors and doesn�t even know it! We hear from companies like this every week.

6. We�re looking for an NT solution not one for the AS/400. That's "old" technology.

Now this is an interesting posture . . . some companies like to have software installed on a bunch of PCs running on the most insecure, virus-ridden platform in computer history. They have an IT staff that spends much of their time upgrading, troubleshooting and servicing hardware and software just to keep the company functioning. A CRM package doesn�t have to work this way.
There is an alternative. You can have a CRM solution that runs on the most secure, stable, virus-free, and hacker-free platform in computer history — and it's accessed over the Internet to eliminate maintenance and upgrading issues, and streamline manpower allocation! In addition, it can web-enable your existing green-screen and AS/400 applications, plus integrate back-end legacy, homegrown or ERP data and applications.

7. ERP is the top priority at the moment.

ERP systems are important. They can help you organize your business from operations to accounting, save money and help your organization be more efficient. But you need to ask yourself, given all the IT projects you could undertake, which one is going to have the quickest impact on the bottom line?

If this economy is causing your sales to be a little slow, what would boost your revenues most right now? For about the cost of a single IT staff person for one year, you can install a CRM package that will be up in running in 30-60 days, will help you locate sales opportunities, will cut marketing expenses plus earn the loyalty of customers on the verge of finding your competition.
What is most important to your firm today? Ask President Bush. Ask your CEO. Ask the controller. The decisions you make now are key to the culture you create for the future. Do you want your company to be accounting oriented? Operations oriented? These are ERP drivers! If you want the firm to be customer-oriented, you had better start to organize your processes and culture around your customers' needs! This, my friend, is the future — the one-to-one enterprise!

Recently, an article in CIO magazine cited that CRM technology accounts for only 20 percent of the benefit of a CRM program. 80 percent of the benefit comes from the new business processes that result from the cultural change, the article states. The moral? What tool should drive your business processes? An analogy: If you overhaul your car, should you replace all the wiring (ERP) or simply tune up the engine that controls whether the car goes or not (sales/CRM)?

8. We�re happy with our current system.

What does "happy" have to do with anything? If I�m the CEO or a major shareholder of your company, sure I want you to be happy! But if you�re happy just because your job is familiar to you and you don�t want to try new methods of servicing customers and increasing revenue, then it�s resume time again!
Why are you "happy" with it? What results are you getting from your current customer management or contact management system? Is it incorporating and displaying data from your ERP system or accounting software, pointing the way to new sales opportunities? Does it allow all customer-facing employees to know what�s going on with each and every account?

Or are your salespeople closing orders with accounts that are on credit hold? Do sales and collections call the same account on the same day? Or do two salespeople from your company ever call the same customer on the same day? Do you even know what is going on? Maybe it�s time to find out!
What is your current system? Is it integrated with important financial data? Does it provide access to remote users? Is it updated in real-time? Is it easily customizable? Does it fit your industry? Is it flexible? Is it economical?

9. We only have a few "select" customers that are easy to track.

This implies that your customers, while few, aren�t worth tracking your interactions with. I would think these few, large and vital relationships would be far more important than they would for the company who has thousands of customers, where the loss of dissatisfaction of one, will not affect the big picture that much. Correct?
I would want to very carefully manage how we interact with a few, important customers. Who in our company calls them? What is offered and discussed? How they are being serviced and what are our response times?

If I�m the CEO of a company and write-off a tool like CRM, because I think my VP of sales knows each and every account, then what happens if he quits or gets hit by a car? Or Heaven forbid, he dies. Who knows about these key accounts now? What happened to the relationship with that account that the VP nurtured for 10 years? You better know what has transpired, who likes who, and how these accounts want to do business with you! A few slip ups with a few key accounts could cost you big-time!

10. We want to build our own CRM system in-house.

Okay. Where will you start? If you wanted a customized car, wouldn�t it be easier to buy the chassis and frame with engine, transmission, electrical, etc, and everything running well, and just customize the parts that don�t fit you now? Isn�t that your issue? That you think parts of a CRM software need to be customized to fit your particular business?
Some CRM packages are highly customizable and easily fit into your business model and business processes. This makes it simple to get the functionality that other programmers have spent years developing, without needing to reinvent the wheel. Can you afford to wait years for development? Will it be worth the wait?

For the price of the licenses you need, you would probably spend many times that in the salaries of the developers alone, and they would never have the experience creating the functionality you need. Suggestion: find other things for the idle programmers to do (i.e. improve the order tracking system or production control, develop portals and custom web content on demand.)
Do you make your dishwasher? Toaster? Build your own bicycle? Then don�t try to make your own CRM solution either. If need be, buy one already made and customize it yourself! Look for simple "drag-and-drop" customization and features tailored to your industry.

Conclusion:

We all want to feel that we are in control of our department�s destiny and helping to shape our company�s future through our contributions. However, we often make shortsighted decisions because we don�t take time to understand our options. One of Steven Covey�s Seven Habits of Highly Effective People is: "Seek first to understand, then to be understood." The mistake most of us make is to listen with the intent to reply. The first thing we want to do is to state what we want to do or what our position is, rather than listening for the benefit to us. I�m glad I listened to the financial planner who called me several years ago. Will you be glad you listened to the next CRM rep who calls you?

There are many excellent CRM solutions available to fit many different needs and industries. Wintouch eCRM is an enterprise-wide customer service, sales force automation, marketing automation and partner relationship management suite for the IBM iSeries AS/400 Platform. Wintouch eCRM software has a Java-powered, Web-browser front-end. Server software is native AS/400 RPG code, which protects your investment in IBM iSeries hardware, while web-enabling your existing green screen applications!

Wintouch eCRM is robust, economical, and specifically designed for the AS/400. Contact Touchtone Corporation today by email or call (714) 755-2810 from 8:00 a.m. to 5:00 p.m. PST.

By Rich Hall
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10 Stupid Reasons Companies Give for Not Buying CRM