Customer relationship management (CRM) is failing because IT managers are not fully exploiting the technology.
While organisations appreciate the need for systems to improve customer relations, enhance customer services and retain existing customers, very few companies report successful experiences with CRM projects, according to pan-European IT and telecoms consultant, PMP Research.
In a recent survey of 50 UK companies with an annual turnover of £50m and above, PMP found that 92 per cent of respondents felt that their CRM systems had not been 'very successful', although 38 per cent said there had been 'some benefit to the business'.
A large number said that it was too early to judge the success of such projects despite having had systems in place for over a year.
PMP also found that organisations are continuing to invest in CRM systems. However, as purse strings are being tightened, predicted spend on CRM among a third of respondents will fall to below £250,000 this year compared with £1m last year.
"It's clear that companies are keen to embrace the new CRM technology available," commented Neil Ferguson, research director at PMP. "But there's still a long way to go before CRM systems prove their worth. Companies seem to feel a certain ambivalence as to what CRM has done for them and that the systems are not exploited fully enough to achieve maximum benefit."
Analyst group Gartner Dataquest estimates that 65 per cent of firms worldwide will have incorporated CRM software by 2002, and that by 2005 the global spend on CRM solutions will rise to $76bn, up from $23bn in 2000.
Meanwhile, analyst group Giga has produced a 12-question plan that companies should consider before starting the implementation of CRM systems.
"Although there is the temptation to get moving once CRM goals have been established, it is worthwhile to take a break and recheck some critical questions," said Giga's Richard Peynot.
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