Survey reveals CRM crisis in global corporates

Many customer relationship management (CRM) initiatives in the world's largest companies are at "serious risk of failure", according to research from the Meta Group.

Although 80 per cent of companies polled said they have at least one CRM application up and running, they are failing to benefit fully from them as they are not using datawarehouses for in-depth analysis. Few of them are using applications that allow proper collaboration with customers.

While many companies are employing customer-facing applications such as call centres and Web sites integrated with front, back and mobile offices, Meta estimates the world's largest companies will have to spend as much as $250m over the next two to three years to achieve tangible returns on CRM investments.

Mark Huey, Meta Group senior research analyst, said: "It's often very easy for companies to justify expenditure when there are obvious, short-term returns on investment. But getting it right in the long-term, getting that 360-degree view of your company and its dealings with customers, is harder."

The report advises companies rolling-out CRM projects to "take dramatic action to optimise their systems around the customer, or their customer relationship investments will not pay off".

Toby Detter, customer service programme director at Shell, which has implemented a large-scale CRM project, said: "We haven't had problems with the data mining side of CRM, but it depends on what you're trying to do. The challenging part of CRM is changing the mindsets of people in established companies and the way they approach CRM. That takes time."

Martin Riddell, European marketing director at CRM vendor GoldMine, added: "CRM isn't a technology, it's a business process. A lot of CRM solutions aren't implemented properly - within enterprises they can take twelve to eighteen months, and businesses are likely to change in that time."

He claimed enterprise providers such as Oracle, SAP, Siebel, and Vantive provide complex CRM packages, but it is also up to end-users to have a realistic view of what can be achieved.

Meta Group - in conjunction with its research affiliate, IMT Strategies - interviewed 50 end users including Eastman Kodak, Nortel Networks and Sprint.