The Question Behind CRM: Keeping Records or Getting People to Do Things?

The Question Behind CRM: Keeping Records or Getting People to Do Things?

We just finished a survey in which we asked our outside advisors what kind of information we should collect this year. We tried to look at how sales companies are now using technology to see if it makes a big difference in sales. In order to keep things from getting too complicated at the start of this research, the poll included the following question: Does your company use customer relationship management (CRM) as a way to collect and store information about customers and prospects, or as a way to improve relationships with customers and prospects?

After getting more than 500 responses to the poll, we took a quick look at the data and found that most people fell into one of two groups. When we then looked at how the projected sales went for both groups, we learned something very important, which you can see in the graph below.

In the current uncertain economic and political climate, when most sales organizations are looking for ways to improve sales performance, the big difference in win rates stood out. When looking at win rates, the main focus is not on increasing the number of opportunities that a sales team finds. Instead, the main focus is on increasing the number of deals that have already been found and closed. About 30% of the difference in scores is between the groups that use systems of record and those that use systems of engagement. If a sales organization that used a system-of-record was able to make the necessary changes to turn CRM into its system of engagement, the effect on revenue performance would be huge. But this leads to the next question: What makes the way these two groups use CRM different?

When a CRM is mostly used as a system of record, the tools for managing contacts, accounts, opportunities, and pipelines are the ones that get used the most. When we asked sales organizations what the top three benefits of CRM as a system of record were, the most common answers were that it made it easier for salespeople to do paperwork, made it easier for salespeople and sales managers to talk to each other, and made it easier to predict sales.

There's no question that these are good changes, but what they really meant was that the sales process got better. Since sales teams also have trouble being effective, sales organizations need to find ways to free up salespeople's time so they can make more calls and use technology to help salespeople make good calls.

If you are only using CRM as a way to keep track of information right now, you should look into the many ways you can start using it as a way to communicate right away. And if you're already using a system of engagement, make sure your sales teams know what features are available to them and that they've had enough training on how to use those features in their regular workflow. This is especially important if you already have a system for getting people to do things. These are small changes that will make your current sales methods better, and the return on investment (ROI) will cover the cost of making these changes.