If we invest a budget in the development of IT infrastructure, then we want to know exactly how much profit it will bring us. Each of our clients, before starting a project for the implementation of a CRM system, thought about calculating the effectiveness of the implementation. In this article, we will talk about how to measure the effectiveness of the implementation of a CRM system in a company.
In most cases, business owners come to the need to implement a CRM system when absolutely necessary. It is not surprising that reasoning about efficiency in such cases is at the level of common sense. The importance of increasing the productivity of the sales force or the life of the client is clear to everyone. But calculating ROI (return on investment) is much more difficult, since there is no clear formula for assessing this variable. But even in the absence of a calculation formula, it is necessary to estimate the costs of paying for CRM and implementing the system, and most importantly, the commercial results that the company will receive as a result.
If the work processes in the company were debugged before the project, then from the implementation the company will increase income by increasing employee productivity, increasing the speed of customer service and preventing the possibility of duplication or loss of information.
The effectiveness of CRM implementation is ensured by the way the business processes are built within the system, as well as by their automation. If we talk only about the technical implementation of CRM and sales automation, the result for the business will be cost reduction and optimization of business processes.
The company will receive much more effects with an integrated approach to the implementation project, when, in addition to setting up the system, a CRM strategy is developed and the sales system is optimized. For example, we can significantly reduce costs, increase customer LTV, build the right motivation for employees and reduce the risk of internal and external factors affecting the company’s income.
How to measure the effectiveness of the implementation of a CRM system
In order to correctly conduct an assessment of effectiveness, it is necessary to determine in advance the key indicators, in the context of which you will track the ongoing changes. Before starting the project, it is necessary to measure the values of key indicators. After the implementation of the project, you will be able to analyze them in comparison “Before and after” implementation of CRM.
The tricky part is that CRM is needed to collect data on internal conversion, audience response to ads, and lost customers. Another problem is that the results from the implementation of a CRM system are individual for each specific company. Therefore, the owners of the companies and top managers make a rough estimate.
For example: “LTV of clients increased by 7-10%, which increased profits by 25-30%. Automation of routine actions of managers has doubled the effectiveness of managers”and similar judgments that do not carry value.
The main performance metrics can be divided into 3 categories:
- Direct commercial efficiency
- Indirect commercial efficiency
- Effectiveness from risk reduction.
Thus, comparing the key indicators for each of the three metrics, we will be able to assess the effectiveness of investments in CRM implementation. For the most accurate calculation of efficiency, it is necessary to identify and measure key indicators in advance of the start of the project.