Why CRM Tools Have Failed Sales Teams?
Technology has given rise to new tools and innovations that make the sales process easier.
Today’s sales teams have a wealth of data available at their fingertips.
This lets sales leaders control the sales process and understand how they can improve the performance of their indirect sales.
If we’re going to compare controlling a salesforce to directing a battlefield, the metrics are the data that will determine your next move. Sales metrics like Time Spent Selling, Lead Response Time and Customer Acquisition Cost help leaders assess how they can adjust their sales activities and gain their desired outcome.
That said, businesses have decided to spend millions on CRM tools. Executives are always on the lookout for software that can aggregate more data and speed up the reporting process. However, will these investments pay off in the long-run?
The Problem With CRM
There’s nothing wrong with having a lot of data.
We want tools that will improve our salesforce’s reporting capabilities to assess the team’s activities, gauge performance and provide direction. It’s easier to determine your next move when you have research-backed data.
In the past few decades, we’ve seen a rise in CRMs. Tools promise to streamline the sales process, meet customer relationship management goals, and provide actionable consumer insights. Unfortunately, these increased reporting capabilities do little to boost sales performance.
For instance, sales managers can determine the number of hours spent acquiring leads and training sales employees. However, how can you transform the data into actionable insights that can boost conversions?
Jason Jordan – author of Cracking the Sales Management Code – believes that CRM tools don’t tell users how to convert numbers into actionable insights.
Despite all the CRM tools at our disposal, sales managers and indirect sales agents merely advise their partners, resellers and brokers to do more. When salespeople need more leads, they should just spend more time acquiring them. When they want to improve profits, they should dedicate more time to contact prospects.
“It’s somewhat concerning that given the highly sophisticated analytic capabilities that CRM affords us, very little direction is given back to sales managers and their reps other than to do more.” Jordan writes.
The mantra “do more” is similar to the principle “study harder, not smarter”. We believe that by telling our salespeople to work harder then we’ll eventually get more sales — but this is far from the truth.
If all it took to make more profit was to “do more”, then businesses just need to hire new salespeople and contact more leads all the time.
Sales veterans will know that the industry doesn’t work this way. You need to understand the context and let metrics and activities function as pulleys and levers that you can use to control a sales force.
Operating a sales force
CRM tools let us monitor metrics that are relevant to sales performance but it doesn’t let managers see the big picture.
Jordan believes that CRM tools are missing something fundamental — the operating instructions for a sales force.
How do the metrics work? Can you analyze the data points and determine how you should adjust sales activities and sales objectives? What objectives should you set to achieve your target results? If you want to improve the opportunity win rate, then which metrics should you monitor? While a sales manager can get a thick sales report, they don’t know how to manage the numbers.
According to Jordan, when sales managers understand the relationships of their metrics, they could strategically control their sales force to achieve their target results.
Want to boost customer acquisition? Not a big deal — here’s what they need to do. How will you acquire more leads? Here are the metrics that you need to watch. What sales managers don’t know is how to manipulate these numbers.
Instead of strategically controlling the sales force, executives tell their teams to do more. Want more sales? Work harder. Need to reach your sales targets? Make more calls. This strategy relies on the luck of the draw and salespeople are left stressed and pressured to work harder.
This is the problem with CRM tools. We can accurately measure the performance of our sales force, but it doesn’t have operational instructions. We can generate the numbers, but we don’t know how to use them to our advantage. We’ve mastered the art of measuring sales performance, but not the sales management code.
How to master CRM?
There are a lot of CRM tools at your disposal but they’re useless if you don’t know how to manage them.
Jason Jordan’s book titled, “Cracking the Sales Management Code” started to paint the big picture. His team spent hours grouped 306 metrics into three categories based on their manageability.
Here’s what he found:
- Activities – metrics can be managed and controlled at will.
- Objectives – metrics can be influenced by managing sales activities
- Results – metrics cannot be managed although the results can be influenced by managing sales activities and sales objectives.
Don’t have time to read a 250-page ebook? We understand that sales managers and executives have a busy schedule so we’ve summarized the key learnings and findings in our mini ebook.
BRM as the missing link with CRM
How to upgrade your CRM? Try a BRM tool.
BRM stands for Business Relationship Management, it’s a new category that complements CRM. It allows sales managers and channel account managers to link objectives with activities and the results as registered in CRM.
It also lets sales managers segment intermediaries, resellers, brokers and resellers so they can manage them more effectively.
Want to learn more about BRM? Here’s our post on why your company needs a BRM tool.