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CRM Summit: The best laid plans lead to ROI

Planning is key to achieving a return on your CRM investment, according to one insider speaking at Gartner's CRM Summit Spring. But getting everyone on the same page isn't always all that easy.

CHICAGO -- Realizing measurable return on investment (ROI) has become an elusive goal for many CRM deployments, but at least one industry analyst believes that having the right plan can make all the difference.

As part of Stamford, Conn.-based market analyst Gartner's CRM Summit Spring, Research Director Beth Eisenfeld outlined her strategy for guiding organizations to ROI success. The framework revolves around several basic precepts that strike at the heart of CRM planning inefficiency.

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"The costs and benefits of CRM are justified," Eisenfeld said. "Multiyear capital project planning is paramount and ongoing measurement systems must be put in place to ensure that benefits are achieved."

She said the key to getting a predictable return on your CRM investment is having a rational plan going into the project with realistic goals and a clear-cut strategy for spending. The key for CRM project managers, in Eisenfeld's opinion, is building an airtight case to defend CRM expenses to the senior executives who have their hands on the purse strings.

"You have to make sure that you understand all the costs within your plans and manage all the details in those plans to pull them altogether," she said. "Look at how costs are spread across the project and use graphics to defend long term benefits. A picture is worth a thousand words."

Eisenfeld advises that before attempting to bring CRM applications onboard, organizations fill out complex impact analysis studies that measure how front-end costs will impact revenues until the software systems begin to earn their keep. Another key to the ROI strategy is keeping executives from adding new demands on functionality to the CRM plan without properly adjusting for additional costs.

But Eisenfeld concedes that evangelizing CRM is easier than making a strategy work flawlessly.

Integrators and consultants, often left to try to turn these best-laid plans into a reality, also understand the subtle game involved in laying out an effective strategy within the existing parameters of an organization.

"A big part of the challenge in defining where you can reap measurable ROI is understanding the political game that goes on in many organizations regarding CRM," said Todd Nash, global capability leader for digital intelligence at consultant Headstrong, Fairfax, Va. "When you're building benchmarks to show weaknesses within a company, you're going to make some enemies of the people who's shortcomings are being highlighted."

Nash also believes that too many CRM customers fail to take into account just how their plans are going to affect personnel-related costs and integration related to legacy systems. Another pitfall, Nash said, is failing to recognize how new applications may shift existing relationships with outside service providers.

"People are too easily swayed into picking off low-hanging fruit when developing their plans and cost analysis," he said. "That's a dangerous oversimplification that eventually makes it much harder to move upstream and tackle larger issues."

For her part, Eisenfeld also endorses a list of do's and don'ts that CRM managers must follow if they hope to be successful in achieving maximum ROI. Among these bullet points are: seeking a software package that fits desired functionality by at least 75%, thereby cutting costs involved in customization, and minimizing "regionalization," in order to help keep company-wide plans on the same tack.

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