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Making a CRM implementation work for a change

In a recent searchCRM poll, we asked you which topics you would most like to see covered on our site. A majority (57%) said you are looking for information on how to prepare your organization for cultural change before, during and after a CRM implementation. In response to that poll, searchCRM brings you advice from experts on successful change management strategies.

Preparing for a CRM implementation isn't always as easy as it sounds. In addition to selecting the technology and processes, companies need to get their employees behind this change in order for the strategy to be a success.

"The reason there is so much difficulty is because we're dealing with resistance to change," said Bill Brendler, president of Brendler Associates Inc., a firm that specializes in change management.

"Change management needs to address the different levels of the changing technology and help [the employees, customers and partners] use the new system," said Dave Hanaman, executive vice president and co-founder of C3i, Inc., a CRM services company that offers training and support.

"When CRM doesn't work, it's because [the company's management team] hasn't looked at the principles of change management and has tried to slam-dunk technology into the organization, where people are not willing to utilize it correctly," Brendler said. The second reason that change management can fail is because the company itself is not designed to handle the change with the way the employees are set up, he said.

The old organizational model is product-centric, Brendler said. Management makes all the decisions in this organization, while employees and customers alike are frustrated with the inefficiency of this process. Companies have to transform themselves into a customer-centric organization, he said.

Brendler said the philosophy and hierarchy of most of the product-centric organizations is based on the Catholic Church and the military, which doesn't work for an organization that wants to be customer-centric. Representatives dealing with customers on the front lines of the business need to be able to make decisions that affect customers, rather than waiting for upper-level management to hand down a decision, he said.

Brendler was quite candid in using DirecTV's model as an example of a hierarchy that he says does not work. Reaching a human being for customer support takes three-and-a-half days, Brendler said. When the customer calls the support line, the customer ends up in an automated menu that does not lead to a customer service representative, he said.

"As soon as the competitive spirit takes over, DirecTV will be out of business because they have no clue about the customer," Brendler said.

When it's time to change

Organizations need to redesign themselves so that they are team-based, breaking down the boundaries between management levels so that there is no longer the hierarchy, Brendler said. The employees need to be involved in the change management process as well, he said.

To change this inefficient process, management first has to accept a strategy that deals with the change process, including how much has to change, how capable the organization is of changing, and whether or not the organization has the resources to carry the change out, Brendler said. The change strategy should match up with the customer-centric strategy.

"With that goes the mindset," Brendler said. "The CEO of the company has to change first, because when the CEO changes [actions] first, [employees] see how important this is, so the emphasis and priority is on change that person's top management team has to be in that boat too, or the [employees] are not going to believe" that the change is real or important, he said. "People will not believe words; they believe actions."

The next step in the change process is to get the employees to a workshop or conference, Brendler said. In the workshop, the company should involve the employees in the change process, and "by the end of three days, everyone is reading out of the same hymn book about what has to change and what the customer really wants," he said.

"The conference is the key to change management, involving as many people in the process and not telling them what to do, but allowing them to come to conclusions about how to change and deciding what to do about it," Brendler said. "It cuts the time of the change process in half."

The sales, marketing and customer service departments should no longer exist as separate departments and should be brought together as one cross-functional team, Brendler said. Having these separate departments within an organization makes no sense, except to a senior manager that wants power and control, he said.

"This is very simple," Brendler said. "Get your employees involved. It's control and power that we're trying to break down.

Companies that have successfully transformed themselves include: insurance and financial services firm USAA, Sun Microsystems, Cisco Systems, Mercedes-Benz and Marshall Industries, according to Brendler. "Those are all the ones that have done this by using change management as the basis for recreating the company," he said.

"Sears Roebuck eliminated their building in Chicago because it had seven levels of management," Brendler added. While the department store's chances of survival are still tenuous, they are still much more customer-oriented than while they housed seven floors full of management personnel, he said.

Process before technology

Alluding to the popular cartoon character Dilbert, Brendler said, "Management creates this awful thing people work in. If you took the office away from the CEO, he'd sit with his secretary and wouldn't talk to people" in the cubicles, he said.

"One of the things that needs to happen is that companies need to slow down the adoption of new technology and make change happen where the processes are that go out to customers," Brendler said. If the technology is in place before the processes, then the technology will not be enabling a customer-centric strategy, he said.

Change management occurs on three levels, according to C3i's Hanaman: the technology level, the business process level and what he calls the individual user effectiveness level. "Change management has to address all three of those," he said.

"On the business process level, good CRM systems, well-implemented, can radically change the business process for the better," Hanaman said. Companies need to use technology to change that process, within the capabilities and limitations of that technology, he said.

For example, with Web-based technology, doctors can order pharmaceutical samples online from sales representatives, without having a face-to-face interaction, Hanaman said.

"Change management on the macro level ripples through the entire organization," Hanaman said. "What is difficult is having to manage change, not just as it relates to people on the [company's] payroll, but people who [are] customers and partners. Education and change management have to address customers and partners," he said, referring to the business process level of change management.

On the micro side, which encompasses individual user productivity, Hanaman said the important thing to remember is that CRM and e-business systems rely on most users using it effectively most of the time. It requires each user understanding how their interactions with the system affect the overall business process, he said.

When implementing a new CRM process, "it has to be conceived, designed and implemented correctly, and not purely from a technology standpoint," Hanaman said. "The business process concepts have to be sound and advantages to individual users need to be there."

Secondly, if the user benefits are real, companies need to communicate these benefits to their employees and customers, Hanaman said. "If it's a good system then the director of marketing ought to be using it as well," he added.

The third part is the ongoing educational component, Hanaman said. There should be an ongoing learning system, complete with feedback from the employees using the technology most often, such as the help desk personnel and field sales force, he said.

Companies planning on implementing a CRM system and going through the change management process should ask themselves, "Are they doing this for a strategically important reason or doing it for another reason," Hanaman said. "A strategically important reason doesn't mean that it's the most important investment the company is making, but the CRM system should link directly to and support the strategic goals of the organization," he said.

"If you're doing CRM just to roll out cool technology or just to get call reporting from the field, or just to replace a bad old system, you'll likely fail," Hanaman said. "But if you're doing CRM to support strategic objectives, then its importance will be recognized."


Brendler Associates Inc.

C3i, Inc.

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