Reason Why 63% of CRM Initiatives Fail

New CRM initiatives currently have a 63% fail rate, according to a new study by Merkle Group Inc. For anyone considering CRM this is quite a scary statistic, although not surprising, when you consider the number of that barriers that face organisations implementing a new CRM system or updating their current one. These barriers include; Lack of employee buy-in, unclear business objectives, lack of long term strategy, unclear about data requirements and companies often buy systems that are not fit for their specific business requirements. These are just a few examples of barriers that face organisations considering CRM. It is of the utmost importance for companies thinking about investing in CRM to fully understand CRM what it can do and the level of commitment required to make it a success, along with the possible pitfalls and the steps required to avoid them. This article will focus on how a lack of managerial experience, and knowledge of how to approach CRM properly can cause major issues for companies who try to implement CRM without heeding this advice.

Keys to Success

In order for a CRM project to be a success, it is imperative that all levels of the organisation buy into it from the very start. This needs to be a top to bottom process, where top level management illustrate the benefits of implementation to the rest of the organisation, in terms of;
• Why there is a need for CRM in the first place.
• How it will enable the end users to increase their productivity
• How it will helps the organisation as a whole
• How it will remedy current pain points

Areas that require Understanding

When an organisation is implementing a new CRM system or updating their current one, there is a lot of information required before selecting a system that can cater to an organisations specific business needs and data requirements. Managers need to have an in-depth understanding of their customer’s buying cycle, current pain points that end users are experiencing, and the data they need to harvest in order to meet the needs of their customers more effectively.

Lack of Managerial Experience in CRM

When top level management do not have the knowledge required to approach CRM implementation properly, it will be impossible for them illustrate the benefits to the rest of the organisation, which means that they are essentially setting themselves up for failure. Many managers view CRM as a glorified address book, and in order for CRM implementation to be successful this outlook has to change as it will inevitably permeate down through the organisation to the end users. If management approach a CRM initiative without researching the full spectrum of benefits that a correctly tailored, implemented and maintained system with full stakeholder buy-in can provide in relation to their specific business objectives, they will have difficulty achieving a satisfactory ROI in a reasonable timeframe.

Management Need to Understand Customer Buying Cycle

An issue that many managers face is that they do not understand the buying cycle of their customers to the required depth. David Ciccarelli, cofounder and CEO of says “to solve this problem, organizations should sketch out a workflow diagram that depicts the customer life cycle.” This visual tool will aid in not only customizing your CRM but fully taking advantage of its functionality.

Management Need to Understand CRM

It is imperative that management take the time to fully understand CRM and how it can benefit them in terms of achieving their business objectives and their staff in terms of how it makes their life less stressful thus enabling them to increase productivity. The process of acquiring this knowledge may not be as straight forward as some managers’ think. In order to drill down to the necessary depth managers need to engage in an on-going dialogue with front line staff, Chris Fritsch, CRM consultant and owner of CLIENTSFirst Consulting states that “To succeed with CRM, organizations should get end users actively involved before even looking at systems.” This dialogue may take some time to put in place, and significant commitment from staff at all levels to maintain, however it is an integral part of CRM implementation and if done correctly will pay dividends down the line.
Management Need to Understand Front Line Needs Pain points
If an organisation is implementing a new CRM or updating an existing one, it is crucial to understand the areas where their front line staff are experiencing issues or areas where they could be better supported. It is one of the main jobs of an effectively implemented CRM system to enable users to focus 100% on the job at hand, as opposed to getting round the flaws in their current CRM system that is simply not fit for purpose.


There is a lot of legwork that needs to be done before implementing a CRM solution. If this legwork is not done properly, it is likely that you will add to the 63% of companies that fail. However, if the necessary steps are taken to get to grips with what CRM can actually do and how it can be tailored to your organisation, your customers and your staff, it is likely that you will become part of the 37% of companies that enjoy a great ROI, increased staff productivity and customer satisfaction. Microsoft Dynamics CRM is a fantastic tool, which can provide companies with the necessary tools to turn data into profit.