Why vendors may learn to love independent CRM consultants…

December 29, 2008 Richard Boardman

I get the impression that most CRM vendors are at best deeply suspicious of CRM consultants. Not surprisingly, as a CRM consultant myself, I’d argue the negative impression is undeserved, and that we provide considerably more benefit to vendors than they realize. The common complaints are that access to the client is managed and therefore they don’t feel they have control of the sales cycle, and that the purchase process is likely to be more competitive and therefore the odds of winning are longer.

While there’s some truth in this – vendors have much less scope to use spin or charm to secure the sale – I suggest the odds of securing a consultant run sale are higher than the average prospective sale simply because the contract will be awarded to someone, as opposed to most prospective sales which peter out with no decision, generally because the business case hasn’t been made.

It’s in the area of business case generation and general CRM project planning that independent consultants add a lot of value to both client and vendor. Their involvement means that by the time a vendor becomes involved, the foundations of a solid business case and appropriate funding are in place. I’ve worked with clients who’d been talking with vendors for years, but who had never proceeded because they hadn’t satisfactorily determined how the technology would help them.

Establishing business cases is something I think vendors are largely very bad at. To an extent this is because end users are wary of vendors and don’t open up in a way that facilitates the process, but mainly because vendors tend to be technology rather than benefit focused. This blinkered approach is partly about comfort – it’s easier to talk about something you are very familiar with (your software) than something you are not (the potential client’s business) – but also about experience: it’s challenging to apply technology to a potential client’s unique business unless you’ve considerable operational experience and insight.

Aside from helping create the environment in which a CRM project will happen, the consultant also benefits the vendor by smoothing the path of the CRM implementation process itself. Consultants will advise clients on key planning issues such as funding and resourcing, as well as facilitate effective requirements gathering. There are consequently fewer things that go wrong in the implementation process which increases project profitability and customer satisfaction.

It’s in this last respect that vendors particularly benefit. The projects we work on generate significant value to the end user which means they in turn are more likely to invest further in the system. As I’ve argued repeatedly in the past, the average CRM implementation generates little return, and therefore receives little on going investment. The presence of the CRM consultant therefore produces a client that has a considerably higher than average life time value, and can provide considerable reference value.

Ironically, many of the projects we work on become flag-ship case studies for the vendors, though our role in the process isn’t generally acknowledged. I suspect this is because CRM vendors associate us solely with vendor selection activities rather than the business case generation, planning, budgeting, and requirements gathering activities that are vital to ultimate success.

The only vendors that should dislike independent CRM consultants are those with something to hide. Sadly, there a quite a number who rely on deceit rather than candour to win business. They rarely appreciate our work in exposing their fabrications. Even this of course is beneficial to the honest majority in the vendor community because it helps ensure decisions get made on a level planning field, and that dishonesty doesn’t prosper.

Perhaps I’d be naïve to figure on getting many more Christmas cards from vendors next year, but in time perhaps more will appreciate that the end user isn’t the only beneficiary of our involvement.