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CRM customers: Help us leap integration hurdles

New SearchCRM.com research shows that CRM adopters are most concerned about integrating their software with legacy apps.

 
 

Companies tackling CRM projects see application integration as their biggest challenge and consider integration capabilities to be vital to CRM technology, according to the results of newly released SearchCRM.com research.

Despite significant vendor initiatives on the integration front -- including Siebel Systems Inc.'s ambitious Universal Application Network strategy -- 47% of respondents cited integration issues as being among the most significant obstacles to successfully completing a CRM project. Integration finished as the top hurdle, ahead of budgetary concerns (44%), getting executive buy-in (43%), and end-user adoption and acceptance (38%). Each respondent chose three obstacles.

"The steps CRM vendors are taking are baby steps," said Sheryl Kingston, CRM program manager at Boston-based Yankee Group. "It's not going to solve the problem."

 

To underscore the importance of integration, 94% called integration either an "extremely important" or "somewhat important" factor in a CRM software choice.

Most of the 226 respondents were CRM directors, IT managers or consultants, representing businesses of all sizes, mainly in the U.S. The complete survey results will be released this week at the inaugural CRM Technology Decisions conference in Atlanta.

When it comes to satisfaction, only 15% rated their initiatives either "much more successful" or "somewhat more successful" than expected. One in four said their projects are turning out about as expected.

Still, the nearly 37% of respondents who called their efforts "somewhat less successful" or "much less successful" fall short of other industry estimates that put the CRM failure rate as high as 70%.

Kingston calls these results "a step in the right direction" and was more encouraged by the fact that 58% told SearchCRM.com that they actually measure ROI on CRM projects. In previous studies, respondents have indicated dissatisfaction but also confessed to having few metrics in place to gauge results.

The survey may raise a few eyebrows in regard to the success factors businesses are seeking. Only about one in five chose so-called "hard" returns on investment -- increased overall revenue and cost reductions -- as their most important criteria. Instead, more difficult to quantify ROI metrics fared well. For instance, 47% named improved customer satisfaction as a top return.

"It's a good sign," Kingston said. "But don't forget that when [a project] comes up to the CFO, we still have justify spending."

When asked their perceptions of the market-leading CRM vendors -- Siebel, PeopleSoft Inc. and SAP AG -- respondents generally gave their products high marks but described all three as expensive.

Thirty-eight percent said that Siebel's product features were either "somewhat better" or "significantly better" than average. Yet 39% called the cost of those offerings "significantly worse" or "somewhat worse" than average.

Thirty-one percent called PeopleSoft products "somewhat better" or "significantly better" than average, while 21% said its software was expensive. The breakdown for SAP had 29% rating its products favorably and 40% citing high prices.

Respondents saw little difference among the three vendors in terms of service and support. Because implementation and integration expenses eat up large portions of CRM budgets, Kingston said, this is an area where the vendors should be trying to distance themselves from the pack.

"If your support drops, your customer satisfaction drops," she said.

The survey results indicate that Microsoft Corp.'s newly released midmarket CRM software is likely to attract some attention. One in three said they'd seriously consider it when making a CRM software decision.

Forty-four percent agreed with the statement that hosted CRM offers significant value. The hosted applications space is one of the more hotly contested CRM arenas, with market leader Salesforce.com being challenged by NetLedger Inc. and Salesnet, among others.

Overall, respondents think vendors' product promises are overblown. Four out of five said CRM vendors oversell the benefits of their software.

More than half also plan to increase their CRM spending this year, with one in four saying they'll shell out at least 10% more than last year.

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