One of the most perplexing technology decisions a company will make is the selection of their Customer Relationship Management (CRM) tool. Recently vendors in this space are trying to spread adoption of their tools throughout the organization, but basically they are still mostly used by the Sales department. One of the reasons that CRM tools are so perplexing is because management just can not understand why salespeople do not use the tools the way management wants them to. This is certainly frustrating because normally so much time and effort is exerted in selecting and implementing such a tool.

If I were to go to LinkedIn and post a question asking why is the adoption of a CRM tool so low by salespeople I would get a ton of responses. Many of them centered on how the Sales team wasn’t appropriately advised throughout the implementation process, or how sometimes the tools are too complicated, or some people would simply comment on how Sales professionals are just lazy and not interested in entering the data into the system. Well, as someone that has been in the industry for a long time and have used a few different traditional CRM solutions, let me tell you the truth.

When companies are selling complex products with long sales cycles, there are two main reasons why the traditional CRM is not used as much as management would prefer and they have nothing to do with the implementation or the actual features of the system itself. The first reason is that the CRM does not advance the sale. If you are a sale rep working on deals that have an average 12 month sales cycle, there is nothing in the CRM system that is going to reduce a 12 month sales cycle to 9 months. Nor is there anything that is really going to help increase the percentage of closing that deal. So after getting the initial contact information on a prospect the sales rep starts to see less value in the system. The second reason is that the CRM does not add direct value to the prospect. Can you remember the last time any prospect has asked what CRM system are you using? I have never had a prospect ask and that is basically because they do not care.

I believe such systems are great, and needed for things such as territory management, contact management, and forecasting. Essentially, they are created for managing customer data much more so than managing the customer relationship. In my explanation I have used the term “traditional CRM solution” and that is because I think CRM vendors have realized the limitations and are starting to change. I believe vendors are working to make their systems more collaborative and more engaging. We also think business collaboration software products such as the BCN help fill this gap because they are truly products that engage and add direct value to clients and prospects. We believe having collaborative work spaces where prospects can easily get and share information with their vendors, and others in there industry is a current trend that is increasing. This combination of business collaboration software integrated with your traditional CRM is really the way to develop a true Customer Relationship Management solution.

I have been told that most good pet stores will not sell you fish at the same time you buy a new fish tank.  However, you can buy the tank at one place and then go somewhere else to buy the fish.  If you take both the fish and the tank home, fill the tank, put the fish in the water immediately, it will be a good chance that the fish will be floating at the top of water the next day.  So the question is, was it the fish, or was it the water to blame for the death of the fish?

What does this story have to do with sales and sales management? 

In this analogy the water in the tank represents sales management and the environment created by them, and the fish represent the individual sales representatives.  The reason fish were floating at the top of the water the day after they were put in was because the water/environment was not properly prepared.  It wasn’t because the fish were unhealthy. It takes some time to prepare the environment/water which is why the good pet stores do not want to sell the fish at the same time as the tank.

In my many years of experience I have seen, and continue to see so many companies with extremely high turnover of sales professionals. So the question becomes who is to blame? Is it sales management, or the individual sales representatives?

In situations where we see sales managers with 100% or 200% turnover I am inclined to believe that the people whom left were not the problem.  In those types of situations the common denominator is the sales manager and the environment that he or she has created.  It can’t always be everybody else’s fault.

In one situation I have seen a VP of Sales hire 14 people to fill and refill 5 direct report positions in less than few short years.  So was the problem the fish (14 people), or the water (the sales VP)?  I think the answer is simple, but I am a little confused as to why companies struggle with the question.

Chances are most (not all) sales professionals will be successful if the company provides them with established sales territories, sales leads, decent sales collateral, along with great sales leadership.  If those things don’t exist, is it really their fault that they are not successful?  So is it the fish or the water?

“Information is power” or “knowledge is power” are two beliefs that are quoted all the time. From a sales management perspective I believe that having pertinent information is critical in forecasting and closing deals, so I tend to agree with those statements.  I never know what piece of information will give me leverage as I strategize and/or negotiate during a sales cycle. The question is: how do I make sure I have all the pertinent information? Do I rely on a system (i.e. CRM application), or do I rely on the account executive, or do I use the combination of both?

If I rely on the account executive, what happens if he or she leaves the company?  With companies that have long and complex sales cycles it is often the case that an account executive that starts the sales cycle is not around when the deals closes. With multiple account executives and possibly others involved in the sales cycle, how do I ensure that the pertinent information is captured, and made accessible? In other words, how do I make sure the majority of information does not leave when the account executive does?

Most companies realize that this situation exists and in response they implement expensive Customer Relationship Management (CRM) and/or Knowledge Management (KM) solutions to avoid a negative impact on revenue. I believe implementing those solutions are admirable, but they do not adequately address the negative impact caused by turnover issues of account executives.

So much of the information captured throughout any long sales cycle is informal and not documented.  Information gathered in meetings, phone conversations, and email exchanges are often not made accessible to all members of the team.  This information usually is not documented anywhere which is why I call it informal, but that does not mean that it is unimportant. A lack of information can be costly if a person is making a critical business decision and they assume they have all the pertinent information. In addition, misplaced information can create some inconsistencies in dealing with your prospects which is never good.

I believe there are two main reasons why account executives typically do not enter informal information into their CRM or KM solution, and they have nothing to do with how the systems are implemented.

1) The sales executive does not see how entering certain information into a database will advance his or her sales cycle, or increase the deal size.  Since sales management makes the account executive use the system, they may enter some meeting notes, presentations or forecasts updates, but that is about it.  However, they usually will not enter all prospect objections and questions, or other information that they figure might not be pertinent at the time.  

2) The system does not provide any direct value to the customer or prospect. The fact that a sales executive will enter customer data into a CRM solution is great for the company, but that is not necessarily an activity that a customer appreciates.  Your traditional CRM or KM solutions are internal tools that do not provide any direct value to the prospect or customer. I have never had customer or prospect ask me what CRM or Knowledge Management solution we used. So if the prospect does not care, then why should the sales executive care?

The idea of valuable information leaving the company, and the challenges with keeping it has paved the way for new Web 2.0 technologies such as Business Collaboration Software.  These types of web based technologies create an environment where all the members of a sales cycle can collaborate with prospects, customers and each other online and in real time. This way all interested parties can contribute to entering, exchanging and editing information.  For example, when a discussion happens in a collaborative space all of the information is automatically categorized and stored electronically and every relevant party will have access to it going forward. There is no need for additional data entry, because the data is entered as part of the normal course of doing business.

Unlike with many other applications, Customers and prospects see direct value with business collaboration software and using it adds to their overall experience. Now they can go to one place to quickly access all relevant conversations, documents, and professionals.  This kind of environment increases productivity on both sides, and it just makes doing business a lot easier all the way around.

In addition, if the account executive leaves, it is very easy to build a trail of what has happened if companies are using collaborative workspaces.  Companies will no longer be held “hostage” by a particular person leaving the company and taking the majority of information with them. This continuity also adds direct value to the prospect or customer, since they want to avoid having to explain to a new account executive their requirements all over again.

Almost every company is constantly trying to figure out how to increase revenue. As if that is not challenging enough in these economic times, it is even harder to accomplish that goal in an efficient or cost effective manner. In some instances the cost of sale is equal to the revenue generated by the sale.

Companies that distribute their products through solution based selling typically have a much different challenge than those companies that sell products/services in one, or perhaps two sales calls. Usually with solution based selling there are many more people, or teams involved, much longer sales cycles, and a lot of information is exchanged throughout the process. In addition, the relationship with the customer does not end after the sell is made. Having an effective way to communicate and foster that relationship can prove vital to the long term success of the company.

There are many different technologies that attempt to make companies more efficient at creating and maintaining relationships with customers and prospects. However, most of these technologies fail in an attempt to reduce the overall costs for acquiring a customer, and for maintaining a quality relationship.

Many companies are starting to rely on social media platforms to address this very concern. Tools such as Twitter, Facebook, blogs, and even LinkedIn can be great for communicating with clients and prospects. In 2010 the idea of creating groups, followers and friends has truly become commonplace; but only time will tell how helpful those tools are in long, complex, high dollar sales cycles.

I have spent the past 15 years in different Sales and Marketing roles, and I learned from my experience successfully selling to companies such as Wal-Mart, Shell Oil, ExxonMobil, Texas Instruments, Johnson & Johnson and others that many clients and prospects are looking for something a little more intimate than Facebook, or customer portal sites. I also found that these companies value the opinion of their peers, and they look to interact with each other frequently. When I was an outside sales rep I needed a more cost effective way to interact with customers and prospects, and to have customers and prospects interact with each other on the continuous basis, and in front of me.

Getting clients and prospects together at annual user conferences and other marketing events is nice, but it does not provide an easy way for constant interaction. An environment is needed so that clients can interact with the sales rep and other clients throughout the day/week/year without attending an event. This kind of ongoing interaction can provide valuable insight to the vendor. It is also beneficial to the customers that are interacting with each other, and it can enhance customer loyalty.

I think we all realize those facts. The question is what tool do we use to accomplish our objective?

The introduction of Web 2.0/Sales 2.0 technologies presents an opportunity for organizations to reach their desired goal of driving revenue more efficiently. Business Collaboration Software allows any user the ability to create a secure, collaborative workspace so that they can create their own client community. Within that collaborative space/community users can exchange ideas and best practices through discussion forums, and share documents by using the file library. There is no software to download or install and users only need a web browser to access the system.

Despite all the technologies that exist (i.e. the traditional CRM, SharePoint, Social Media Platforms, and email) companies are increasingly using business collaboration software to supplement their existing sales and marketing efforts. It is an easy and inexpensive way to leverage the experience of happy clients and add direct value to the sales rep, thus helping them drive revenue efficiently.

I realize that there is an art to creating engaging dialogue online. It is essential that companies use tools where the sales rep has the ability to define who is invited to the collaborative workspace or client community. It allows the person with the most knowledge of the relationships to decide who speaks to whom. Aligning the “right” group of clients and prospects makes all the difference in your success.