CRM software pitfalls to avoid is a checklist of items to be cognizant of and address while licensing CRM software. Enterprises are embarking on CRM (Customer Relationship Management) transformation programs to take advantage of the new generation technologies, including but not limited to, cloud-based SAAS solutions, data mining and analytics, social engagement, and user experience.

Not all the CRM Software pitfalls will be relevant to each enterprise. It depends on the type of CRM software solution, the type of sales model, customer segments, type of products and services, and related factors.

If an enterprise is not aware of the CRM software pitfalls and address them prior to software selection, and throughout the software implementation and rollout, the millions of dollars of CRM investments will be at risk.

The list of CRM Software Pitfalls to Avoid:

    1. Data Ownership: One of the biggest CRM software pitfalls to avoid is to be clear on who owns the data (applicable mostly to SAAS solutions) and how easy is data migration (both import and export). Establish clarity of data ownership, migration strategies, and secure channels for data transport.
    2. Total Cost of Ownership: TCO (Total cost of ownership) is difficult to establish and is fraught with potential for widely divergent estimates based on certain assumptions. Sometimes, it is not a clear black and white issue, but shades of grey. The feature set, deployment (in-house or SAAS), initial and ongoing price variables,  the total number of users, integration costs, and other considerations drive the total cost of ownership.
    3. Integration with other key systems: CRM cannot live as a silo and will achieve suboptimal results if it is deployed as such. CRM needs to integrate (or have inbuilt functionality) for features such as contracts management, product catalog, pricing and quoting, order management at the very least and in most cases perhaps integration with other ERP systems may be essential. Whether the CRM platform can easily integrate – thru APIs or pre-built adapters – is a critical decision. A siloed CRM system can be a huge pitfall.

If an enterprise is not aware of the CRM software pitfalls and address them prior to software selection, and throughout the software implementation and rollout, the millions of dollars of CRM investments will be at risk.

  1. Ease of Use: It is not enough to just have a checkbox for various features. While feature breadth and functional depth are important, today more than ever, ease of user is a critical value proposition and a significant pitfall toward user adoption.
  2. Contract Terms: There are several contract terms that could become big traps. Who owns the data, which was previously addressed, is one such contract term. Others are the categorization of users – contributors, reviewers et al – and how they are charged such as user/seat count; the terms for upgrade – mandatory versus optional – and the frequency of upgrades; price escalations etc.
  3. Configuration versus Customization: Configuration is good, customization is bad is the adage and there is a lot of truth to it. However, understanding how the CRM software can be modified to the individual needs of an enterprise and the effort/cost involved will help avoid a major pitfall.
  4. Industry Specific Templates: The needs and features needed in different industries vary widely. Hence, having industry specific configurations or templates will do three things: a) establish the credibility of the software vendor in a specific industry, b) reduces the cost and effort of configuration or customization, and c) accelerates time to value.
  5. Global Footprint and Regionalization: If a company has a common language across geographies, language and regionalization may not be important. However, in most firms, these considerations are real and relevant. Hence, a CRM software that does not facilitate language customization and regionalization can be a pitfall that cannot be easily recovered.
  6. Training and User Adoption: The CRM software vendors, who know their software best, should be a key partner and a driving force in training and user adoption programs – at least train the trainer level.
  7. Security and Compliance Considerations: In this era of security breaches, application and data security have become critical considerations. Companies subject to regulations (HIPAA or SARBOX etc.) should consider security protocols as a special consideration.
  8. Next Generation Features: As an enterprise customer, reviewing the CRM software vendor roadmap for next generation features is important as the world of CRM does not stay static.

Are there other CRM software pitfalls to consider and be cognizant of? Please share them with your peers.

Please also review CRM Transformation Resources including the CRM Transformation Framework and the CRM Transformation Toolkit.