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The 5 Worst Blunders of CRM-Destroying Execs

By Christopher J. Bucholtz
Sep 9, 2014 6:37 PM PT

One of the CRM secrets to success is executive buy-in. That typically means the support of a high-level executive for the deployment and use of CRM technology. That executive often is a senior vice president of sales, or maybe a chief revenue officer or a CMO.

The 5 Worst Blunders of CRM-Destroying Execs

The support of multiple executive roles is critical to implementing and supporting a CRM strategy. Having the buy-in of one executive is not enough. If you really want to capitalize on CRM to boost the bottom line, your entire leadership must embrace it -- not the technology, but the discipline of CRM.

That means that from the CEO on down, all your executives need to understand why CRM is important, what it really means, and how their part of the organization can improve or impede it.

Unfortunately, because CRM usually finds its way into businesses through the sales department, it's often viewed merely as a tool of sales. That misses the point. In the era of the empowered customer, every part of the business plays a role in building the business's relationship with the customer.

When many executives don't pay attention to CRM and some actively work against it, the business suffers. Following are five ways executives frequently contribute to poor performance of CRM -- and inadvertently weaken their entire company's performance.

1. They stifle CRM innovation through budget starvation.

While "traditional" CRM has become accepted in most companies, the emergence of a more social customer means more opportunities to use new technologies and tools to reach them. Hence, the emergence of the SCRM acronym almost 10 years ago, and a host of new vendors bringing technologies to market to deliver on SCRM's promise.

Every tool costs money, though, and that can grate on executives in charge of budgets (namely, CIOs and CFOs). While spending money prudently is never a bad thing, there's a learning curve that needs to be climbed in order to understand how new CRM technologies can be best used and deliver on their promise.

In many companies, the trial period for these technologies is simply too short to produce conclusive evidence that they do or do not work. A technology can be judged a failure even when its recent poor performance is due to its misapplication by users or other human factors. As a result, investment in these tools -- and other tools that can complement them and improve their performance -- is reduced.

The key for executives here is to understand that new technologies need time to become fully integrated into the way the business works. Making decisions too early can throw all the learning your team has amassed out the window and result in a truly wasted investment.

2. They use CRM to browbeat sales.

This chestnut never seems to go away: After cajoling and urging sales reps to use CRM religiously, executives then turn around and use CRM data to attack sales reps for their performance.

There's nothing wrong about being forceful with poor performers -- that's how sales VPs stay employed, after all. Still, using the nitty-gritty of CRM to do it sends the wrong signals. Put yourself in the sales rep's shoes: Why should you do all the work to input data into CRM every day if at the end of the quarter, you're going to have it used against you?

Sales reps in this situation often do the CRM equivalent of "taking the Fifth." They include positive data but omit negative data, or they don't enter anything in CRM at all. This may get their manager off their back -- or a bigger boss off their manager's back -- but only temporarily.

Executives should not view CRM data not as a gauge of their sales staffs' competence. It's only one factor in determining what's going wrong or right with a company. Other considerations may impact sales for better or worse. It's the sales manager's job to put the data in context. However, pulling data from CRM to browbeat sales is a terrible mistake, and one easily avoided. Instead, use the same data to coach reps and look for improvement.

3. They engage in turf battles over who owns what.

We've all seen it. Instead of joining forces to conquer, the CMO and the SVP of Sales or the CRO instead turn on each other. A battle ensues -- not against the competition, but internally over resources, staff and, ultimately, power within the company.

Those resources may include things like CRM, marketing automation and sales enablement tools. Ideally, these two kingdoms within the business would share the data these systems record and organize, since without it each is flying half-blind. When sales and marketing misalignment get personal, however, the data becomes one more weapon in the petty struggle for dominance.

This calls for a strong CEO who can force a truce on the warring parties. That truce should be predicated on the idea that the real objective should be the success of the company; winning a power struggle but losing the business is not good for one's career.

Unfortunately, in many cases when this battle becomes bitter, the CEO enables it by being too timid to speak up when the first signs of conflict appear, or by showing obvious favoritism to one side or the other and empowering that side to continue its bad behavior.

4. They fail to support CRM concepts outside of sales and marketing.

CRM is understood to be a tool for sales and marketing and, to a lesser extent, support. However, in reality, the ideas of CRM extend far beyond those who use the technology to attract and retain customers. In the social era, all employees play an important role in customer acquisition and retention through the things they do when they come in contact with customers. That extends from billing to product development and even to human resources -- how employees interact with customers can leave a lasting impression.

Executives need to realize that the concept of a customer-centric business -- one that values long relationships with customers -- means that every customer interaction is important. Even if you're not in charge of sales, marketing or support, the people you manage can have an impact on the company's ability to sell and retain customers.

Do they know that? Do you emphasize that? Or do you have the myopic view of days gone by that the parts of the organization that are not "customer facing" have no impact on customers?

5. They create CRM crises that spread to the rest of the company.

The era of the celebrity CEO has brought many business leaders into the public spotlight, but that attention means they must be circumspect in their behavior. While public interest in what a leader does or says can have great value when promoting the business, it can backfire spectacularly when the executive goes off-script and says something insensitive or dumb -- especially in this era of social media.

While CEO gaffes don't directly affect individual customer relationships, they can create fissures in those relationships and require those in contact with customers -- sales reps and marketers, especially -- essentially to apologize or explain on behalf of their bosses.

Not only is this uncomfortable, it's unprofitable. Instead of working to maximize the value of relationships, they're scrambling to prevent those relationships from coming to an end.

Business leaders need to realize that they're no longer insulated from the public, and that the opinions they express -- especially provocative ones -- can be used against their companies. Circumspection and prudence are important Without them, you'll be keeping your employees on clean-up duty and away from their revenue-producing real jobs.


CRM Buyer columnist Chris Bucholtz is content marketing manager for CallidusCloud and a speaker, writer and consultant on topics surrounding buyer-seller relationships. He has been a technology journalist for 17 years, focusing on CRM since 2006. When he's not wearing his business and technology geek hat, he's wearing his airplane geek hat; he's written three books on World War II aviation.


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