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April 29, 2016
The Top 5 Reasons Why CRM Is Dead
Earlier this week, I sat down with the VP of Sales Ops at a new customer. ”We think about our CRM system the same way we think about our phone system or our network,” he said. “It’s a required cost of doing business.”
Yes, every enterprise company needs a CRM. It’s a given on every “starting-a-company” list:
- Phone system? Check.
- Network connectivity? Yep, check.
- Website? Check again.
- CRM? One last time: check.
So this same VP’s next sentence — “CRM is dead!” — came as a bit of a surprise.
Given my experience with CRM systems, this statement felt rather dramatic. I’ve been involved in using, running, deploying, and managing CRM systems since 1996 (remember GoldMine?) “No (medium to large) enterprise company is EVER going to rip out Salesforce and start over,” I told him. “It’s simply impossible.” (Insert Marc Benioff and Keith Block “Mwahahaha!” here ;-)).
But he didn’t actually mean CRM as CRM — he meant CRM trying to be something it’s not. He gave me 10 different “square peg-round hole” examples where CRM wasn’t designed for certain use cases in sales. Sales has changed, and managing sales reps has changed along with it. Sales is in the early stages of a massive shift to modern systems and modern communications. We’re a modern industry now. CRM, while a mandatory weapon for business, simply cannot solve every use case and pain point for the modern sales organization. Here are the top five that stood out for this customer:
1. Better, Smarter Forecasting:
They needed a much better approach to support sophisticated, yet simplified forecasting across their entire sales org. His view was that CRM has not been designed from the ground up to enable better, smarter forecasting.
2. Activity Analysis:
They needed a better way to understand rep activity and customer interest — and its impact on their forecasts. He said forcing reps to enter events (e.g. I met with the CIO today) into their CRM system manually (a) does not scale and (b) leads to poor data collection, bad accuracy, and frustrated reps. His view was that CRM systems are not designed to capture additional “engagement signals” from sales teams and customers.
3. Deal Predictions:
They could not reliably identify areas of risk and upside in their forecasts based on CRM data alone. They needed more “deal exhaust.” From his perspective, machine learning based on only one data source — and an incomplete one at that — provided too many false positives and negatives that led to misjudgements and mismanagement of the business. A real problem.
4. Top-of-Funnel Analysis:
They needed a better way to evaluate the strength or weakness of inbound leads, and to decide fast which could become accounts worth pursuing. In his view, CRM was designed mainly to store leads and manage them through the funnel, not to predict which leads would make the hottest pursuits.
5. Customer Behavior Predictions:
When it came to existing customers, he mentioned that CRM couldn’t offer predictions on possible upsell opportunities or future buyer behavior. They needed more information to nurture their existing accounts and understand levels of customer happiness, which cannot be found in CRM data.
If you’ve read this far, you’re clearly passionate about understanding the future of CRM and the future of Sales Ops. To find out about the other 5 “square peg-round hole” examples from this VP of Sales Ops, please join us at EXCEED, the first-ever event dedicated to data driven sales operations and enablement on May 4-5 at Levi’s Stadium in Santa Clara. You’ll have the chance to speak directly with this VP of Sales Ops and 99 other sales visionaries about the future of sales operations — and how we can make better, data-driven decisions.