It seems that having a project come in On-Budget is the
holy-grail of project management, especially when it comes to
CRM projects. With their 70% failure rate, CRM projects
represent a significant risk to a small business' financial
health and warrants more "measure twice, cut once" consideration
before beginning.
Coming in On-Budget does not mean you managed to squeeze your
project into whatever arbitrary budget you came up with when you
first started. It also doesn't mean that you started with an
overly generous budget.
It does mean that you develop a budget that takes into account
an analysis of 4 critical areas:
1. PAYOFF. You need to know exactly how your CRM system is going
to generate ROI. This will help you focus your project on the
right areas. By knowing how you expect payoff to be achieved,
you can plan to achieve it.
2 RISK. You need to figure out where the risk is in your project
because "risk=expense". By figuring out what can go wrong, you
can take measures to minimize and contain that risk.
3. SERVICES. Be sure to fully account for the variety of
services that will be required. A few often overlooked areas
that can increase your services bill significantly incoude:
meetings, testing time, debugging time and "while you're
here..." time.
4. TECHNOLOGY. Choosing the wrong technology is can be a huge
waste of money. From the worst case scenario of a totally failed
project to having to spend extra money to make the wrong
software do things it wasn't intended to do.
What makes putting together a realistic budget so difficult for
small businesses is that it's not what they do and they don't
have the experience of having done several before. It's not what
they do. So, they rely on the Sellers of CRM who have their own
vested interest in not scaring off their customers with numbers
that are perceived to be too expensive.
By putting together a realistic budget, you may very well find
that the project is going to cost much more than you were
intitally prepared to spend. It's best to find this out now and
before you "sign on any dotted lines".
If you do find out the project is going to cost more, here are a
few ideas of what to do:
- WAIT & SAVE. Perhaps you need to wait 6 months until you have
a bigger budget. Use this time to get prepared for the project:
learn more about the software choices, make sure you're business
processes are as fine tuned as they can be, and focus on how CRM
software will generate ROI.
- GO AHEAD. It may be more money than you were expecting, but
may still be within your budget. If you're clear on how the CRM
system is going to generate ROI and you're otherwise ready, go
for it!
- SCALE DOWN. If you have a very clear idea of how the CRM
software is going to achieve ROI and you can't afford the full
project, focus in a smaller area to begin with that will have a
payback. Use this payback to help fund future projects. It's
always a good idea to start with smaller, high-payoff projects
first.
- FIND MORE ROI. If you have a really clear and compelling
business case for how a CRM system is going to improve your
bottom-line, it's much easier to find the necessary funds to
implement it.
- DOUBLE CHECK. Make sure you're choosing the right technology.
Cheap software can often be expensive to implement. Double check
to make sure you're basing your budget on the right CRM
software. You may find that a software that costs more in
licensing, ends up being an overall more affordable solution.
Coming in On-Budget means you started with a realistic budget.
The Insider's CRM Success System goes into great detail on how
to develop a realistic budget and provides the control forms and
worksheets you'll need.
About the author:
Scott Gingrich, founder of The CRM Coach (
www.thecrmcoach.com)
is the creator of "The Insider's CRM Success System", the
world's most complete and only CRM Success System guaranteed to
save thousands, developed specially for small business.
