The promise of CRM (customer relationship management software) was that it would automate the selling process, help salespeople keep track of their prospects, remind them of where they are in their sales pursuits, and generally turn a physical Rolodex card into an interactive tool that is perpetually up-to-date, accessible, and in the end helps a salesperson sell more.
The reality has fallen short, and the dream of salesforce automation has turned into the nightmare of what my colleague Nate Skinner calls “salesforce administration.”
Denis Pombriant framed the issue as a competitive roadblock for business in a recent Harvard Business Review article: “How can companies expect to compete in the digital age with outdated systems that no one wants to use? How can employees properly serve customers when performing even basic functions is as frustrating as a trip to the DMV?”
I will discuss what CRM should really accomplish for sellers in my next article, but today I’m simply going to vent a little about how CRM is failing us. Because really, I know from personal experience that CRM has turned into a monthly chore that doesn’t make anyone happy. And I’m not alone; research by Beagle Research shows that 66% of sellers would rather clean the bathroom than update their CRM system!
CRM was supposed to help sellers sell more to new and existing customers, and to close more deals with prospects in a shorter time frame by guiding them through the sales journey. But it doesn’t do that.
Instead, what it does is force salespeople to update the system at the end of every month, just in order to satisfy their managers. The CRM isn’t giving them updates—they’re just updating the CRM. It’s as if at the end of every day, I wrote out a to-do list itemizing everything I had done that day and then immediately checked each of them off. Sure, the exercise might make me feel good about how productive I’d been that day, but it hasn’t actually helped me do those things or get them accomplished faster.
Well, you might say, sales managers do need some kind of forensics in order to make sales projections they can share with upper management. But most of those projections are wildly inaccurate.
Why? In a CRM system, as any user can tell you, you’re asked to rank every deal according to your likelihood of closing a deal on a scale of one to ten (usually six or seven discrete stages), where one means the prospect hasn’t been called yet, and ten means a deal has been closed.
So deal prospects come in as a one, and the salesperson updates the status to two once the first call is made. In theory, the salesperson should update the ranking every time they think the situation has evolved, but in reality, they don’t have time to do this. They need to place another call. The salesperson doesn’t actually update the number until a sale is truly imminent, at which point they skip several stages and update it to five. Managers cannot rely on numbers that jerk forward from two to five for any meaningful projections—but they do it anyway because they derive a false sense of confidence from the system.
By the way, another vaunted advantage of CRM was that it helped ensure businesses that customers didn’t walk out the door when a salesperson took a job with another company. But what's the value of a stale customer list in a corporate database when the real information is on the salesperson’s smartphone?
Let’s not forget that CRM was invented long before the rise of the smartphone, and today’s salespeople have all their useful contacts in their pockets. They don’t need a separate application to tell them who their contacts are.
Why does CRM get more expensive every year if the value proposition is becoming stale? Today’s legacy cloud CRM systems don’t provide salespeople with information they need to sell more. In the best of cases, it reminds them that someone’s birthday is coming up, which is nice, but it doesn’t tell them whether that someone has been happy, been issued a refund, or could actually be in need of something they sell based on all their other activities. It also doesn’t tell them why prospects were qualified in the first place or suggest a great reference customer as a handy example the seller can reference when talking to the customer.
This failure of traditional CRM has never been more disappointing. The pandemic has accelerated a trend toward digital buying—particularly in the B2B space. According to McKinsey, “the pandemic has cemented omnichannel interactions as the predominant path for B2B sales.”
According to Gartner, “the typical buying group for a complex B2B solution involves six to 10 decision makers‚ each armed with four or five pieces of information they've gathered independently and must deconflict with the group. And in today’s world of B2B buying, there's no handoff from marketing to sales, or digital to in-person. It’s a parallel process, not a serial one.” Only 17% of the buying process is spent with sales reps.
This means customers do more research before speaking to a rep than ever before, are more empowered to make buying decisions, and are more comfortable spending in excess of $50,000 on a credit card.
The implication for sellers is obvious. They have to be more responsive, have answers to questions at their fingertips, and be prepared to close deals quickly. They have to maximize that 17%!
This means sales leadership have to ensure their teams are fully armed to meet the digital and omnichannel customers wherever they are.
The current generation of CRM tools simply don’t do that. It’s time for something new; what that looks like is something I’ll elaborate on in my next article.
In the meantime, see how Oracle Sales guides sellers with intelligent recommendations to help them focus on the most valuable prospects at the right time. Watch the video below or check out a brief demo to explore our machine learning-based selling tools centered around clean, complete customer data sellers can trust.
Rob Tarkoff joined Oracle in 2018 to lead Oracle Customer Experience (CX) Cloud product and strategy across marketing, sales, commerce, and service. His goal is to build products that help companies succeed in the Experience Economy.
Tarkoff spent the last 15 years focused on the customer experience, developing products for both large and early-stage companies. Most recently, as president and CEO of Lithium Technologies, he created the leading software in online communities. Prior to that, Tarkoff ran the Digital Enterprise business for Adobe.
Tarkoff holds a BA in political economy from Amherst College and a JD from Harvard Law School.