• United States



by Rebecca Wettemann

CRM Planning: Keys for Project Success

Apr 14, 200410 mins
CSO and CISOData and Information Security

Whether you’re updating, upgrading, jump-starting, or restarting your CRM efforts, some basic steps will help keep you on the path to a positive ROI.

Thinking about the potential ROI of your customer relationship management (CRM) project should start during the selection process. Before you write an RFP or start talking to vendors, you need to do some homework to ensure that you’re on the right track to maximize ROI.

Identify the Problem and the Solution

Before you start thinking about vendors, you should define your problem in clear business terms. Do you need to improve management visibility into the sales pipeline? Reduce customer support costs or improve customer support? Reduce customer-related administrative overhead? Making your CRM challenges specific will help you determine which technologies or components are most likely to deliver ROI and how you can prioritize your development and deployment plans. Most companies’ CRM goals fall into a couple of main categories:

  • Improved sales performance
  • Improved management visibility
  • Improved customer support
  • Improved marketing
  • Reduced costs

If your CRM goals fall into more than two of these categories, you’ll likely want to prioritize one over the other and plan a phased deployment. It’s also a good idea to know at this point what your likely budget is, how flexible it is, and what your procurement officer or CFO will be looking for in terms of business justification. If you know walking into the project that you’ll need to show a six-month payback period, for example, you can plan accordingly.

Make the Short List

Regardless of your relationship with existing vendors, previous experience, and technology environment, you should make a short list of potential vendors and give them a fair evaluation before you make a decision. Your short list should be easy to define based on these factors:

  • Your CRM goals. The vendors whose functionality meets your needs will depend on whether you’re looking for improved sales, improved reporting and forecasting, improved support, improved marketing, or a combination of different customer-related technology.
  • Your existing environment and IT philosophy. Do you have existing databases, order systems, or contact lists that will need to be integrated or migrated into your CRM solution? Do you expect to do your own development or use consultants or systems integrators? Are you comfortable outsourcing your sales and marketing data in its entirety – or in part? Answering these questions will help you determine whether a large-scale CRM infrastructure, a hosted solution, a point solution, or a broad solution is likely to deliver maximized ROI.
  • Your user dynamics. Are the employees you expect to use the solution technology savvy and open to change, or are they the ones still using pencils and paper to track leads? The greater the magnitude of the change you expect them to make, the greater the risk that adoption will slow the ROI of your project.
  • Your budget. CRM solutions such as Siebel and SAP can cost millions of dollars to deploy and require a team for ongoing support and maintenance. On the other end of the spectrum, Microsoft CRM and FrontRange (for example) can cost considerably less. You can expect a hosted solution to have a minimal upfront investment and from $500 to $1,500 per user per year.

Clearly defining your requirements and characteristics in each of these key areas will prepare you for the next step – evaluating each individual solution’s ability to deliver returns based on the costs and benefits associated with a deployment.

Check Resumes

Once you’ve identified the likely vendors to deliver the best solution for you, you’ll want to check their references – and this doesn’t mean just reading case studies on their Web sites. Look to independently developed case studies and your own interviews with references to learn about their decision process, project successes and challenges, and whether or not their spending – and benefits – met expectations.

Find a Partner (Check Resumes, 2)

In the CRM world, few companies will deploy a solution without some help from external consultants or systems integrators. Selecting and planning how you work with consultants is just as important to your project’s success as the technology you choose.

Justify Your Investment

Once you’ve identified your goals and selected a short list of vendors, you can use a structured evaluation of costs and benefits to determine the best solution in terms of ROI and build the business case for moving forward. On the costs side, you’ll want to consider the initial and ongoing software, hardware, consulting, internal personnel, and training costs associated with the project.

Here are a few guidelines to keep the ROI from your CRM project on track:

  • You should spend less on software and consulting than 70 percent of expected annual direct benefits.
  • You should be able to deploy and achieve some returns in fewer than six months (even if it’s only a pilot).
  • For a hosted solution, you should see benefits in fewer than 60 days.
  • Consulting costs should not be more than twice your initial software investment.
  • Training users should take fewer than four hours.

On the benefits side, you’ll want to consider both direct and indirect benefits. Prioritize your expected benefits from most direct to most indirect, and then work on your estimates, using internal surveys, case study data, and reliable benchmarking information as a starting point for quantifying expected benefits for your company.

Key Decision Factors

By and large, there’s no such thing as a bad CRM solution. Most solutions deliver value when they’re chosen based on clear business needs and deployed correctly. Once you’ve identified your CRM needs and your short list, there are a number of factors to consider to help you make the right solution decision.

User Adoption

In evaluating the type of CRM solution that will be best for your organization in terms of user adoption, you’ll want to consider two key factors:

  • The willingness of users to adopt the application. Adoption can often be as much about politics and culture as it is about technology. Successful adoption will also depend on how much users will have to change their normal way of doing work to use the solution.
  • The technology ability of potential users. Many CRM solutions are complex and difficult to use; others have a more intuitive look and feel. Choose a solution that fits the abilities of your users.

Once you’ve determined where your organization fits, you’ll want to consider both the complexity of the solution and ease (or difficulty) involved in adding and evolving functionality over time as your needs change and your users become more comfortable with the solution. Here are some red flags you should look out for in evaluating solutions in terms of user adoption:

  • Plans for extensive customization
  • Multiple components that will be integrated to meet your needs
  • Lack of a track record supporting “your kind” of sales reps
  • Functionality planned “for the next release”
  • An extensive training program
  • Ongoing consulting requirements for any changes or updates


In CRM, “you get what you pay for” isn’t always true. In fact, many companies in the past have overspent on CRM components and features that never delivered value to their users – if they even made it out of the box. You’ll have the most success with a measured approach that doesn’t have to include a hefty initial license fee.

Existing Environment

What other solutions and data sources do your sales or customer support representatives use today, what solutions are they most comfortable using, and what will need to be integrated in some way into the CRM solution you choose to deliver value? How you integrate existing resources and applications into a CRM project should not be an afterthought. In selecting a vendor, you’ll want to explore how it can integrate with your existing environment. Demand to see a track record with reference customers in a similar situation.

Best Practice: Make a Match
One company chose Microsoft CRM because it would easily integrate with back-end office applications, because the sales force was already familiar with the Microsoft interface look and feel, and because the design of the application closely matched its existing business processes. It achieved a payback of five months.


In addition to the initial development, integration, and deployment, when selecting a solution, you should consider how easy it will be to make changes over time as your needs change. In all likelihood, the way you use CRM will change over time – and the flexibility of the application to enable you to support those changes can have a significant impact on the ongoing cost of the solution.

Best Practices

Once you’ve determined which solution is right for you and built the business case, you’ll want to make sure you have the key checkpoints in place so that the project delivers on your ROI expectations.

Pricing and Purchasing

Before you sign on the dotted line, make sure you’ve done due diligence on your contract with the vendor. Double-check the following:

  • Is the initial license price per user in line with industry benchmarks?
  • Are you paying less, more, or the average annual industry maintenance? If you decide to stop paying maintenance in the future, does your contact support that?
  • If you’re purchasing multiple modules at the same time, do you have a clear view of the cost of each item? Are you sure you should be buying them all now, or would a phased approach be better?
  • What commitment has the vendor made to your deployment time line? If a third party is involved, how are the deployment risk and responsibility being shared?


Piloting a CRM solution can be a great way to judge both whether or not the solution will work for you and how flexible and agile the solution (and vendor) is in responding to specific needs. Most hosted solution vendors offer a free or nearly free pilot option today; depending on the level of customization and integration needed, a pilot of an internal solution before you buy may or may not be possible.

Best Practice: Pilot First
One company deploying an ePeople CRM solution used an initial pilot at one location to evaluate the application and get valuable feedback on how and when the software should be expanded to other locations.

Even after you’ve made the commitment, piloting to a select group of users before you complete customization is a good way to determine whether or not the solution works – and to gain valuable feedback on how and with what changes the solution should be rolled out to the broader population.

Best Practice: Phase In Functionality
One company deploying a JD Edwards CRM solution found that while it achieved a positive ROI, it could have accelerated user adoption and thus shortened its payback period by introducing functionality to users in phases. A phased approach would have reduced initial customization costs and the need to train users, who were somewhat overwhelmed by the features of the solution.

Fine-Tuning Your ROI

If you’ve picked the right vendor, planned a deployment with clear milestones, and gotten users on board, you’ve probably received 70 percent of the ROI you can expect. The trick to really successful CRM is continuing to evaluate and evolve your solution to deliver greater value. You’ll also want to keep track of potential upgrade opportunities and take a close look at the business case – both the benefits of upgrading and the time and pain associated with the upgrade – before you make a change.


CRM doesn’t have to be a scary or risky project if you’ve done your homework. No matter where you are on the CRM road today, a clear and structured understanding of the costs and benefits of a project, coupled with knowledge of potential user adoption and political issues, will help you draw a road map with clear milestones and risk red flags to deliver maximum returns.