The 10-Step Guide to Buying the Right CRM Solution

The 10-Step Guide to Buying the Right CRM Solution Chris Bucholtz The 10-Step Guide to Buying the Right CRM Solution Contents Executive Summary .................................................................................................................3 Introduction ..............................................................................................................................4 Three Common Mistakes to Avoid When Making a CRM Selection ................................4 The CRM Buying Process .........................................................................................................5 STAGE ONE: Know Yourself .....................................................................................................5 Step 1. Look at Your Own Business ...........................................................................5 Step 2. Pick the Right People for the Team..............................................................6 Step 3. Understand your Regulatory Realities .......................................................6 Step 4. Consider your Budget and Where to Run Your CRM ................................6 STAGE TWO: Know Your Requirements ................................................................................7 Step 5. Integration Requirements.............................................................................7 Step 6. Support Requirements ..................................................................................7 Step 7: Vertical Market Requirements......................................................................7 Step 8: Feature Requirements ...................................................................................8 Step 9: Financial Requirements .................................................................................8 Step 10: Vendor Requirements ..................................................................................8 Conclusion .................................................................................................................................9 About the Author ...................................................................................................................10 Copyright © 2011 CRM Outsiders and SugarCRM, Inc. All rights reserved. 2 The 10-Step Guide to Buying the Right CRM Solution This buying guide is published by CRM Outsiders, an industry blog on all things CRM and was sponsored by SugarCRM®. Executive Summary Buying a CRM solution requires a process different from the typical IT purchase procedure. Because CRM connects to all aspects of the organization, organizations must understand not only the products and vendors available to them but the way their own businesses work. The next step is to understand the ways that CRM is delivered, and the financial implications of those delivery models. Only then should you start examining CRM products and vendors. Do not focus initially on features; instead, start with issues like customer support, vendor roadmaps and experience in vertical markets. Features are important, but avoid a “feature shootout” mentality, because it shifts the emphasis away from business-critical aspects of CRM and toward aspects of CRM that change frequently and which users may not actually use. The CRM buying process can be reduced to a set of 10 steps that will help you pare down the field of poten- tial solutions to a few vendors who are the best fit. From there, you can contact vendors for demos and details to ensure that the decision you choose is the best one for your business. This guide will allow you to move through ten sets of steps, which we have broken into two stages: Stage 1: Knowing Yourself 1. Look at Your Own Business 2. Pick the Right People for the Team 3. Understand your Regulatory Realities 4. Consider your Budget and Where to Run Your CRM Stage 2: Knowing your Unique Requirements 5. Integration Requirements 6. Support Requirements 7. Vertical Market Requirements 8. Feature Requirements 9. Financial Requirements 10. Vendor Requirements We’ll also help you understand the common mistakes of CRM selection so you can spot them and avoid them before they cause problems. 3 Copyright © 2011 CRM Outsiders and SugarCRM, Inc. All rights reserved. The 10-Step Guide to Buying the Right CRM Solution Introduction No one wakes up in the morning, yawns, stretches, and then realizes his or her business needs a CRM solu- tion. That realization comes from hard business realities: slipping sales, service problems, marketing woes, or an escalating series of interconnected problems that ripple across departments. But buying a CRM application is not easy. It’s a crowded marketplace—at least 800 companies provide CRM in some form or function. Picking the one that’s right for your business means getting it right across an array of criteria specific to your business. You need the right functionality, of course, but you also need it to be delivered at the right price, and you need it to match the sophistication of your users. Several factors determine which CRM solution is right for you. First are the market issues: your company size, the specialized needs of your sales, marketing and service teams, and the vertical market your company serves. Next come the technology issues that will affect your IT team—the degree of integration CRM has or will have with your other business systems, the ease of integration between CRM and other systems, the method of delivery (SaaS vs. On-premise), and hardware infrastructure concerns. And then the CFO has his own concerns: up-front costs, maintenance costs, administrative costs and the total cost of implementation and ownership. Getting this right is not easy, but you’re a lot more likely to succeed with it if you keep in mind these three simple criteria: 1. Business Requirements—can it solve the problems I need it to solve? 2. Technology Requirements—can it integrate with my existing systems? 3. Cost Requirements—does it fit into my budget? We’ll discuss how to think about all three in greater detail, but before we do, let’s look at what not to do. Three Common Mistakes to Avoid When Making a CRM Selection Before we talk about the right way to buy CRM, let’s talk about the wrong ways to do it. Estimates of the rate of what is described as “CRM failure” range from 40 percent to 80 percent—and it’s generally not because CRM vendors create bad software. It’s because buyers make some crucial mistakes at the very outset. Those mistakes fall into several categories. The first type of mistake is a failure to candidly examine the issues within a business that drive the need for a new CRM solution. Problems are by definition unpleasant, and exposing them to the light of day can be embarrassing and uncomfortable, especially for the executives under whose watch those problems have developed. Highlighting these issues is seen by many as a career- limiting move. For that reason, there can be a tendency to downplay, deflect or deny problems during the requirements gathering phase, and while that may temporarily assuage anxieties, it sows the seed for far greater problems in the future. Automating processes that don’t work is only going to get you to failure faster—and with a much higher price tag. The second common mistake is to put the priority on technology from the outset. Even if you clearly define the problems you need to address, you’ll have problems if the technology you choose cannot align to solu- tions those problems. If the team choosing a solution becomes enamored of a particular CRM feature, but that feature doesn’t map to a problem their company is suffering from, it shouldn’t be a major consider- ation in their choice. Worse yet is the solution that is impressive in its functionality, but which forces your employees to change the way they work—especially if they’re already successful.