Reason #2: Solving the Missing Equation: Return on Investment

By RedHorse Systems | Uncategorized

Jul 25

In a recent blog I brought up the most common obstacles to adoption of a CRM system.

The first listed was the lack of supporting documentation for return on investment.

The reasons for the absence of figures of any kind are numerous however,
the two most significant, which I will address here, account for the lion’s share of cause.

One of the core functions of the software is that it is modular and mutable.  It updates and changes as the market changes and the functions we need to measure change.
It is nearly impossible to identify a single fixed entity to measure.

Different business use different components seeking different solutions in an ever changing market.

Second, savings over what might or might not have been spent are speculative. A turn of events in the business process could alter the trajectory of any measurement significantly.

Therefore, the single real measure of the value can only be calculated by gauging:ROI

a) What expenses will be eliminated when installing and operating a management system:

Man hours: eliminating cost of multiple entries of data from sales cycle processes such as lead generation, initial and follow up calls, estimates, services, order dispensation and customer satisfaction tracking

Man hours spent on, and advertising dollars spent on, non-performing methods and markets

Man hours spent on communication – information is logged and passed instantaneously

Man hours spent on correcting errors in the multiple entry system

Costs of separate software for separate functions

b) What gains are expected in the new process:

The means to generate emails and ad campaigns from the customer data base

The means to analyze the viability of advertising campaigns

The means to provide comprehensive information access to all management and employees from a single data base

The means to access customer profiles, history and stage in the sales process from a single source

The end focus therefore when seeking a measurable ROI, is the fact that a business’ ability to succeed or fail hinges on the cost of labor vs productivity.

The beauty of the installation of a CRM system is that it directly reduces labor AND increases productivity through efficiency in a single method thereby doubly affecting your bottom line.

See our original blog about Six Good Reasons NOT To Install A CRM System.

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