IT's Hardest Puzzle

Getting people to use a new system correctly is much harder than getting it up and running. And much more important.

After a year's worth of analysis and argument, a large division of a global telecomms company committed itself to a major CRM deployment. This would be a Big Deal. The CRM vendor agreed to make a few nontrivial changes in its software to accommodate Global Giant — that is, "to close the deal" — and both corporate IT and divisional IT agreed on the specs, the pilot and the implementation. Budget and schedule seemed reasonable.

Global Giant's sales, marketing, customer service and channel management departments, on the other hand, had yet to resolve their implementation concerns. They argued they couldn't realistically assess the business impact of a major system they'd never used before. They would work out their differences in the roll-out.

While this didn't make the vendor, IT or Global Giant's management committee very happy, there was an undeniable logic to that argument. Having lived though a painful ERP implementation, everyone figured that the CRM implementation couldn't possibly be as bad.

They were wrong. Big time. Not even a year into the roll-out, the vice president of sales was asked to resign. The head of channel management quit in frustration. Marketing and customer service — which had previously enjoyed cordial relations — hated each other with a passion. More important, several key customers of the telco, as well as some of its channels (stores and value-added resellers), didn't like how their business relationships were now being technically mediated and managed.

The irony? The CRM technology worked perfectly. IT and its vendor delivered what they had agreed upon and promised, on time and within budget. Virtually every technical milestone had been attained. Virtually every customer-touch and customer-tracking process that had been selected by sales, marketing, customer service and channel management ran like an ibex on steroids.

Unfortunately, no one — except IT — used the CRM the way it was supposed to be used, including the customers and the channels. To the contrary, the telco's CRM deployment was a festival of perverse consequences. For example, the stores and value-added resellers were supposed to use the new CRM to manage their own inventory and fulfilment requirements independent of the salespeople. This didn't make the salespeople particularly happy, but it gave them more time and opportunity to sell.

However, these channels kept coming to the salespeople to see if they could get better terms than what the CRM was offering. A few of the cleverer and more — ahem — "customer-oriented" sales folks figured out how to "game" the CRM so that their channel customers got better price, delivery and credit terms. This unexpected intervention messed up both the logistics budgets and sales forecasts for the telco's division. Even worse, a couple of the channels that had played by the new CRM "order entry" rules discovered that they got less favourable terms than their competitors. They complained. They were promised compensation for the differences in prices.

The result? The first six months of the CRM deployment ended up costing the company more money per unit sale. Even worse, the company's threats to discipline the salespeople who had gamed the CRM ruined the sales force's desire to work with the system. The vice president of sales made such a fuss about how his most creative salespeople were being "punished" for their ingenuity that harsh words were exchanged. He was asked to leave.

The new CRM provoked customer service's conflicts with marketing because the customer service reps now had to deal with two data entry and knowledge management systems - the existing one and the new CRM system. Customer service had traditionally helped solve customer problems first and promoted cross-selling and upselling second. In fact, customer service was seen as more of a "technical support" function than a marketing extension.

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