CRM Selection: Seven Proven Steps

As many Customer Relationship Management software vendors have upped their game, CRM selection has become more complex over the last several years. The playing field is more level than ever.

While healthy competition ultimately benefits all organizations, an abundance of choices makes it more difficult for those tasked with selecting the right CRM solution for their company to achieve the optimal outcome.

CRM Selection Steps

Because of the volume of marketing messages from leading CRM vendors, many people are drawn to starting the process of selecting a CRM solution by going to software review sites, signing up for free trials, and rounding up the leading vendors for demonstrations.

However, when the CRM selection process begins with vendor demonstrations, the evaluation cycle can take much longer than everyone, including the vendor representatives, wants it to.

An extended selection timeline has many hidden costs. Choosing the wrong product can result in large multi-year expenditures with little return.

The following is a planning and selection sequence that we recommend to anyone we talk to, whether or not they ask for our help.

Adding structure will accelerate the overall process rather than slowing it down.

Postponing activities such as vendor demonstrations and product feature comparisons usually favor the buyer.

Step 1 – Interview Stakeholders and End Users

To be the most successful, a CRM solution must address the needs of both management and end users.

Input from would-be end users is highly valuable to the CRM selection process. End users spend the most time interacting with prospects and customers.

They are well-equipped to relay observed inefficiencies and user pain points with the current systems. These users may have already developed creative solutions that could be handled within a more robust platform.

When the right questions are asked, operational inefficiencies and customer dissatisfaction that management may not have even been aware of will often emerge.

In addition, if end users are early participants in the process, they can experience a cognitive bias that makes them more willing adopters of a CRM solution once it’s rolled out.

The participants in the interview stage should extend as high into the organization as possible.

Step 2 – Assemble and Analyze the Input

Once the information has been gathered from participants, it needs to be organized and analyzed. User input will emerge with recurring themes. Additional questions may need to be asked of management and end users to fully capture the current state and the optimal future state.

The functionality and performance levels of existing systems and processes (including manual processes) should be cataloged and described in reasonable detail.

Relevant details about existing data systems—ranging from shared spreadsheets to the company’s ERP system—and how these systems are currently functioning or not functioning—should be part of the analysis.

This step’s output is usually a working document and a summary presentation that will become an integral part of the next step. A condensed version of the summary presentation can also be used in Step 5.

Step 3 – Validate and Prioritize

Thorough execution of Steps 1 and 2 will result in considerable information that needs to be reviewed and validated.

Validation of the assembled input is best accomplished via a workshop that includes stakeholders and representative end users. The workshop is a means of communicating, confirming, and discussing various details with participants.

CRM Workshop Room

Once this information has been presented to and discussed with the assembled group, decisions can be made about which requirements should be addressed first and which ones can wait until later.

This step also includes a shortlist of vendors to consider. The vendor list may need to include point solutions and third-party add-on solutions.

Steve Chipman interviews Daryn Reif about A Proven 7-Step CRM Selection Process

Step 4 – Develop a Vendor Ranking System

After a prioritized list of requirements has been developed, this information should be organized so that participants can rank vendors based on each vendor’s platform’s ability to meet the documented requirements.

A ranking system can also serve as a general demonstration guide for vendors. This way, they can ensure that they address the highest priority requirements and address requirements in a logical sequence as they walk the team through the details of their CRM platform.

A ranking system should focus on functionality and the ability of each prospective vendor platform to address requirements rather than on generalized features.

Step 5 – Schedule Tailored Presentations

Prospective vendors and/or their channel representatives should be pre-briefed on your organization’s current and desired future state. They should understand your company’s functional areas and the roles within those functional areas.

Ideally, each prospective vendor representative will deliver a customized demonstration of their solution. It’s up to each vendor to determine how much time they want to spend tailoring their demonstration system.

However, it’s generally in a vendor’s best interest to provide a complete picture of how their solution will solve your organization’s most important business issues.

While a full ‘proof of concept’ often requires a paid engagement, most vendors are willing to put in the effort to ensure that the benefits of a solution built on their platform can be visualized to a significant enough extent.

A single presentation by each vendor is not always enough. Vendors may need to research specific details and then follow up with you. For example, a subsequent technical deep dive session may require your team to understand how legacy system integration requirements will be addressed.

Step 6 – Select the CRM Solution

After the demonstrations, there will invariably be follow-up questions for vendors regarding specific functionality and how it will be delivered.

The participants’ vendor rankings should be consolidated into a single document. While the correct path is often apparent at this point, the rankings can be further scrutinized in the case of a close call.

A final vendor selection should be made as part of this step, and an implementation timeline and strategy should be determined. Initial implementation estimates can be requested from vendor partners at this stage. Enough information will have been collected to provide would-be implementation companies with a solid basis for their initial estimates.

Step 7 – Negotiate and Procure

Once your team has chosen a CRM vendor, additional work must be done. The CRM vendor you select may have multiple editions of its product, and the vendor may allow mixing and matching functionality licenses within an edition. Licenses may be needed to enable specific features or to meet storage requirements.

Your organization may get better overall pricing for pre-purchasing licenses that will not be deployed during the initial rollout. On the other hand, it might make more financial sense to initially commit to a subset of the number of user licenses that will ultimately be needed — and purchase additional licenses in the future.

Your CRM deployment may include specific add-ons or complementary technologies. Pricing and purchase timing need to be determined for these as well.

There can be multiple options for the contract duration. The optimal contract duration should be determined at this stage.

Other Benefits of a Structured CRM Selection Process

It’s worth noting that a formal process for choosing the right system provides many more benefits than just making a CRM vendor decision.

Since the selection process involves defining requirements around your overall CRM process, it provides a significant head start toward the eventual CRM implementation.

Gathering requirements early on also allows more time to expand on specific ideas and refine priorities, compared to beginning the requirements-gathering process after payments for the new CRM system have already begun.

The process outlined above will give senior management a clearer picture of the organization’s operational components. Beyond the CRM selection process, the perspective gained will provide valuable information that can be used as input for strategic thinking and planning.

Formally selecting a CRM system will garner information from employees that has value beyond just CRM. Employees have an opportunity to provide feedback that can ultimately increase their job satisfaction and the quality of service they can provide to customers.

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