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CRM Software Selection Advice

CRM software selection engagements should adhere to a disciplined approach in order to lay a path for implementation success and begin a journey which leads to a planned destination—so say the authorities in software technology media. Obstacles are sure to present themselves, however, business executives, project managers and project teams can prepare themselves with the lessons learned, best practices and shared experiences incurred by professionals who have guided this process multiple times over. The steps below underscore a systemic approach to CRM software selection used by the most experienced professionals.


Phase I Planning


Don't make the mistake of scheduling and viewing CRM software demonstrations before a project team has gathered, documented, prioritized and weighted the organisations business requirements and customer relationship objectives. The most successful CRM implementations invest the up front time and effort to interview all relevant user groups, gather requirements, challenge existing processes and search for more efficient processes and improved ways of doing business. While a time consuming and somewhat laborious exercise, this process is clearly an up front investment which pays significant dividends in terms of a more informed software selection decision and a higher fit product which will lead to an improved implementation, greater user adoption and ultimately achievement of the project's objectives.


During this software selection phase, it is extremely advisable to avoid the temptation to repeat the processes you currently perform in a new CRM application. Most organizations have a big opportunity to improve, restructure and streamline their processes for greater consistency, repeatability and performance. The planning phase is the time to challenge the norm and reengineer business processes that can be further combined with a new business application system for a synergistic effect.


Once you've confirmed your business requirements, challenged the status quo and improved your processes, you are ready to survey the CRM software market for credible solutions. Although there are over 300 commercial CRM software systems in the global market place, no one application suits most companies well so the applications are segmented by their strengths among several key criteria illustrated below:

  • Company size.The most commonly cited company size segments are SMB (small and midsize businesses), middle market and enterprise. CRM software applications are normally designed for their target markets, and usually struggle when placed outside those intended markets. Unfortunately, many software vendors don't acknowledge their preferred client size or target market as they don't want to limit their selling and revenue opportunities. While this all too common practice is very short sighted, CRM buyers need only identify the vendors average user count to determine the company size where each vendors application best fits. Don't make the mistake of trying to implement an SMB solution in a large company or a enterprise solution in a small company.
  • Delivery method. CRM software systems are either delivered as a subscription-based, hosted application (usually called software as a service or on-demand CRM) or as an up front purchase to be implemented on site (generally called on premise CRM).
  • Price. Procurement cost varies significantly by vendor. The Tier 1 vendors (such as Oracle, SAP and are normally the most expensive in terms of software procurement, maintenance and professional services.
  • Company reputation. This is a very subjective criteria, however, one that has a very high correlation with successful software procurements and implementations. Simply put, some vendors offer outstanding post-sale support and some vendors have the reputation of a 'drive by sales organisation.' Hooking up with the later can be an unbearable source of frustration. The Internet and social media have teamed to deliver a communication mechanism that broadcasts the experiences, views and opinions of thousands of CRM users and industry practitioners that have first hand experiences they wish to share with other users and evaluators. These views are often expressed in user group forums, product review sites and blogs and are generally far more insightful and valuable than any marketing brochure or arranged vendor reference. Simply perform a google search of "<software vendor name> reviews", "<vendor name> user reviews" or the like to find information you won't find elsewhere.

Don't be tempted to survey every CRM software solution that has a nice web site. A more focused approach of down-selecting a smaller but qualified list will result in a more thorough and successful selection. A typical down-select list contains three to six software vendors. Once the list is determined, a Request For Information (RFI) can be distributed to each vendor. RFI documents should contain clear descriptions of the most important business and information systems requirements, a budget figure, a time frame or schedule and any company specific requests. Allowing the vendors to ask questions and even make suggestions may provide a more thoughtful and meaningful RFI response. Any questions posed and answers provided should be circulated to all participating vendors to maintain a level playing field. You may want to hold a vendor briefing meeting to kick start the project and evaluate vendor interest.


Phase II Evaluation


The software evaluation phase usually commences with a Request For Proposal (RFP) document. It's imperative that the RFP includes all relevant requirements (in a prioritized fashion) and is clearly understandable by the vendors. The most popular mistake made with RFPs is too consider all business or functional requirements equal. Most consultants experienced in the RFP process recommend that each requirements be categorized into three or four classes. The first classification segment is 'Prerequisites'. These software requirements are the minimum contractual requirements that a vendor must offer to accommodate the businesses most important objectives. Without meeting the prerequisites, there's no sense in consuming either sides time any further. A second class of functional requirements falls in the 'High Priority' group. These are heavily weighted requirements that will most influence the chosen vendor. A third segment is something such as 'Nice To Have' and includes requests for capabilities which demonstrate value, however, a lesser value when compared to the more pressing requirements. An alternative approach is to create a weighted scoring range from 1 to 5 after the Prerequisites class in order to better score each requirement along a fixed scale.


The second important deliverable in the software evaluation phase is the weighted demonstration script. Many software selection teams have been taken down a bogus path by omitting this important step and ultimately evaluating the vendor solutions based on their whiz bang features and not based upon the most pressing business requirements. Demo scripts are absolutely necessary to align the business requirements to the software functionality as well as to the ensure a fair comparison among competing vendors. The demo script ensures that each vendor comparably demonstrates how their software addresses those most important requirements. Without the demo script, the vendors will instead perform what software veterans like to call the 'dog and pony show' (or sometimes called the Show Up and Throw Up). These generic presentations are chocked full of bells and whistles that most attendees didn't know existed. However, while they are interesting, they do little to demonstrate how your most weighted requirements will be satisfied and are certain to skip over the requirements which they don't do well or don't do at all. At the end of the dog and pony show you're left with some impressive demonstrations and a complete absence in determining which of your requirements are not satisfied. This lack of structure also prevents an apples-to-apples comparison among competing solutions. Lastly, make sure that demonstration scripts include weighted scoring by line item and all staff attending the demos are scoring every individual important requirement. Most project teams quickly learn (after its too late) that after the second or third demo, if you don't have an weighted scoring sheet to rely upon, you forget which vendor did what and the ultimate decision is hampered by the subjective memory of each attendee. Viewing software demonstrations is a lot like drinking from a fire hose. You are likely to be overloaded quickly. Unless you score each vendor right away you likely to be unable to accurately attribute capabilities to each vendor solution after the fact.


Also, in addition to helping project team members accurately record their thoughts for each vendor system, the demo script weighted scoring provides two additional key benefits. First, it forces the vendors to actually follow the script. Many experienced consultants have learned multiple times over that if vendors are not penalized for skipping demo script agenda items, they will indeed skip or gloss over those items which they do not accommodate well or at all. By scoring each individual demo script agenda item, the vendors are rewarded to at least demonstrate partial compliance or a reasonable work-around rather than receive a zero score for the item. Second, the weighted scores provide the most objective and meaningful comparison among the competing information systems. Also remember to include RFP scores with demo scores when making the finalist determination as the RFP's are much more comprehensive and include many more items than can be reviewed in a demo. Together these two scoring documents form the most sound decision making platform for designating the highest fit vendor solution.


Phase III Selection


Once the CRM software review and competitive scoring is over, a preferred vendor designation is made. Most software selection project teams will notify all participating vendors that a preferred vendor has been designated. When the preferred vendor is named, the vendor and implementation due diligence process begins. Vendor viability assessment may include a company financial performance report, credit rating review, review for contingencies (such as existing or threatened litigation) and overall company assessment. Note that privately held companies will probably not agree to provide financial statements which they often regard as private and confidential, however, they generally do provide other assurances of profitability and financial position if they are comfortable in those positions. The more time consuming task will involve a review of the vendors proposed implementation plan. It is critical that the buyer make sure that the implementation plan and cost estimate is complete and without omissions. As any software vendor is only as good as the consultants assigned to your engagement, it is extremely advisable to receive resumes and talk to the proposed consultants before committing to the software purchase.


The final selection step is contract and price negotiation. It is helpful to recognize that software sales professionals are experienced and well versed in software negotiation as they perform this exercise routinely. Software sales people are also highly compensated on the results they achieve for their employer. Conversely, most CRM software buyers may participate in one or two software negotiation experiences during their professional careers. This disparity clearly puts the buyer at a disadvantage. However, armed with publicly available information, negotiation can be completed in a way that minimizes time, achieves a fair price and ties vendor payment to implementation milestones and project success.

  The Importance of RFPs

Using a well structured, comprehensive and weighted Request For Proposal (RFP) is one of the single greatest safeguards you can use to reliably match your organisation's requirements to the CRM software systems as well as clearly understand the differences between the systems.


A well crafted RFP will illustrate a meaningful apples to apples comparison point among otherwise seemingly similar CRM software applications. Further, the vendors' RFP responses will identify missing software capabilities prior to making a purchase commitment so that alternatives such as reconfiguration, process work-around's or software customization can be explored and included in the decision making process.


The below 5 Step CRM Software Selection Guide is a white paper which includes RFP suggestions and a template to achieve the following:

  • A method to identify and prioritize the most important business needs and high impact objectives
  • A structured document which logically links business processes with core CRM software modules
  • Suggestions on how to draft an RFP so that it can become a part of your future CRM software license agreement
  • What not to include in the RFP which provides little value or clouds higher impact items
  • How to avoid buying software that you won't use (often called shelfware or bloatware)

5 Step CRM Software Selection

Click Here To Download white paper

Successful CRM Software Negotiation

This white paper includes the recommendations to achieve a fair CRM software price while also contractually earning the vendor’s cooperation, participation and vested interest. With over 12,000 downloads, this instructional guide has been widely cited in several industry publications and CRM industry web sites. This most current version has been updated to include negotiation of software as a service (SAAS) CRM systems.


software negotiation

Click Here To Download white paper






Software Selection

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