Top Evaluation Criteria For Reducing CRM Vendor Selection Risk

Posted by William Band on April 23, 2010

1 comments | 3719 reads

Every year, I take 250 to 300 calls from Forrester clients. The vast majority of these calls are from executives embroiled in the process of trying to select the right CRM technology solution to support their business strategy. From these conversations, I have distilled a set of decision criteria to help you quickly cut through the CRM tech vendor underbrush.

Ability to meet your specific business requirements. You have to know what business outcomes you are trying to achieve, and define the business capabilities that you need to support, before you seriously consider investing in a CRM software solution. Although the core capabilities of leading CRM software vendors are quite similar, the companies I hear from still place a very high importance on the solution meeting the functional and technology criteria that are specific to their needs. Can the vendor meet your use-case requirements?
Ease of use for front-line workers. My clients expect CRM software to demonstrate the capability to make people more fruitful in their work, and this is predicated on how easy the solution is to use. Good usability encourages user adoption. Is the solution UI modern and adaptable to diverse role-based requirements?
Capability to provide advanced analytic abilities. My clients place a high value on CRM vendors' ability to provide analytic tools to better understand customer behavior and make insightful customer-facing decisions using the myriad customer data collected. Analytics are the key to unlocking the value in CRM applications. Does the vendor have powerful and easy-to-use business intelligence capabilities?
Capability to adequately manage customer data. The hope of a “360-degree view” of the customer is often dashed on seemingly lowly customer data issues. Therefore, the ability to support a robust customer master data management approach is vital and the companies I speak with increasingly recognize this is a critical requirement. How does the vendor support data acquisition, cleansing, and governance?
Means to enhance the service function, particularly the contact center. Improving customer service via improved contact center capabilities is vital. Many of I the executives that I speak to report that they started with CRM by working on contact center improvement initiatives, then moved on to focus on sales, and then marketing. They tell me "CRM is never done" and continuously work on efforts to improve customer engagement. Does the solution have strong capabilities to support customer interaction management?
Strong workflow capabilities. My clients are looking for applications that help to better define and automate workflow. Therefore, look for applications with strong and flexible process management competence. Does the solution have native business process management capability?
Ease of use of development and customization tools. Forrester clients seek to achieve improved business results quickly and want new technologies that can be readily adapted to their business environments. Challenge your vendor to show you that that their solution is easy to customize. Does the vendor offer a robust set of development tools?
Robust scalability. Large organizations want solutions that are scalable to accommodate large numbers of users and can support the business globally if required. What evidence can the vendor provide about the scalability and responsiveness of the system?
Capabilities tailored to specific industries. Although organizations that I have surveyed rate industry-customized CRM solutions as relatively unimportant to their selection decision, I see this criterion emerge as very important in the actual vendor evaluations in which I participate. Does the vendor have systems in production at other organizations like yours?
Flexibility to meet changing user needs. Buyers tell me they are on long-term "CRM journeys" and expect to be rolling out new capabilities on a regular basis in response to new business challenges. Therefore, they place very high importance on the flexibility of a CRM application to support requirements that will arise in the future. Is the solution flexible and easy to change?
Ability to improve the productivity of end users. My own studies have shown that less than 50% of buyers “fully agree” that their CRM initiatives met their expectations for achieving planned business outcomes. Can the vendor provide evidence of user productivity improvement?
Capability to integrate with existing technology systems. The companies I talk with usually have heterogeneous application infrastructures and cannot tolerate a CRM application that would operate as an "island" within their organizations. Does the solution have a robust integration approach?
Acceptable total cost of ownership. Not surprisingly, my clients are concerned about the total cost of ownership for business solutions. These costs include not only application licenses (typically 25% of total costs) but also the capital costs of hardware and software integration, ongoing maintenance costs, and the administrative expenses for managing new IT assets. This criterion is driving up the interest in software-as-a-service (SaaS), solutions as companies look for ways to avoid infrastructure costs. Can the vendor provide an estimate of the TCO (not just license and maintenance costs) for the solution installed at your organization?
Quick and accurate vendor response to support issues. Organizations expect to be well-supported by their CRM vendors after the software is purchased and in production. They evaluate carefully how CRM vendors are organized to provide application support and response to technical issues. Can the vendor provide references attesting to their track record to living up service promises?
Methods to support change management to increase user adoption. Virtually every organization I talk with identifies that cultural transformation necessary to become a more customer-centric organization. Promoting rapid user adoption of CRM technologies is one of be their biggest challenges. Can the vendor support and train your employees to use new procedures and tools?
Financial resources sufficient to ensure long-term viability. The CRM vendor market has been consolidating in recent years, and I am continually asked about the long-term prospects of individual CRM vendors. What evidence is the evidence vendor will be around to support your organization in the future?

Republished with author's permission from original post by William Band.

William Band

Bill Band is a vice president and principal analyst at Forrester Research. He is a leading expert on CRM topics, having helped organizations define customer-driven strategies to achieve distinction in the marketplace for his entire career. Click here to download free related research from Forrester (free site registration required).

About William Band |
Connect:

Categories:

Enterprise Technology

3719 reads
Print
Email

1 comments »

Intelestream

June 29, 2010

William, very thorough and

William, very thorough and comprehensive list when it comes to selecting the right CRM vendor for a company.
Thanks!

Post new comment

Your name: *

E-mail: *

The content of this field is kept private and will not be shown publicly.

Homepage:

Subject:

Comment: *

Input format

Filtered HTML

Allowed HTML tags: <a> <img> <hr> <table> <tr> <td> <th><ul> <ol> <li> </li><blockquote> <colspan> <rowspan><object>
Lines and paragraphs break automatically.
Web page addresses and e-mail addresses turn into links automatically.
Images can be added to this post.

Post

Lines and paragraphs break automatically.
Web page addresses and e-mail addresses turn into links automatically.
Images can be added to this post.

More information about formatting options

Notify me when new comments are posted

All comments

Replies to my comment

CAPTCHA

This question is for testing whether you are a human visitor and to prevent automated spam submissions.

What code is in the image?: *

Enter the characters shown in the image.

MarketPlace

Global Customer Experience Management (CEM) Certification Program

[May 30-31, Frankfurt; July 25-26, Hong Kong] An internationally recognized program with proven track record of success - being run for 34 times in 13 cities with attendees from 50 countries, the program is developed based on the U.S. patent-pending Branded CEM Method which aims to drive customer loyalty and brand differentiation with quantifiable business results. Limited offer: USD300 early bird discount.

Join us on May 29th in New York City. Stuart Ryder, SVP, Mobile Research Lead for Ipsos IOTX & Roxana Strohmenger, a leading Forrester analyst, will be in attendance to share best practices and new trends in mobile market research.

[June 12, Sir Francis Drake Hotel] Gregson Siu, Vice President, Ariba Business Operations, Ariba and Bob Thompson, CustomerThink, will be in attendance to share best practices, new trends and latest research to help you develop your customer experience program.

Social Networking and sCRM International Congress in Colombia

[June 25-26, Bogota] Thirteen international thought leaders will present, from different perspectives, the trends, the uses, and the magic - as well as the reality - of Social Networking and how it impacts the way customers are doing/will do business.

Driving ROI With VoC

Walker has identified multiple ways to measure ROI – there is not a one-size-fits-all solution. This paper will address each and conclude with some recommendations to help B-to-B practitioners evaluate which ROI approach will work best for their particular business need.