Why CRMs Fail to Improve Sales Results

Every day there is a new announcement about how this technological tool or that will solve a lender’s production problems. A lot of dreams get crushed and money lost when invariably, the technology doesn’t change sales results. Whether it is Salesforce.com or another vendor, senior sales managers are often disappointed when installing a CRM system to improve sales results. What is going on here? How can such an advanced product be such a non-factor in sales?

Originally, CRM systems were designed to manage customers and provide management with reports. A company’s database systems couldn’t handle all of the customer information and a separate system was needed. But, organizing a salesperson’s prospecting activities — well that is another story and the main reason why CRMs haven’t really improved results in origination.

When you consider that CRMs are not popular with originators, the result is ongoing conflict between management and its sales force. It shouldn’t be any surprise that salespeople reject CRM as a time-waster because as autonomous agents, they would rather engage in selling activities which can make them money than input information for a senior manager.

As originators will tell you, they are pretty much on their own to acquire new customers. Lenders will argue that they support their originators with drip marketing campaigns; but as a whole, developing and implementing prospecting activities is left up to the originator to create and execute. The lender’s justification is that the cream of the crop will rise under a variable pay structure.

So the critical question is what makes sense? Is it smart to have a salesperson input data or for that matter be the front-line contact on compliance issues? I would argue that in a higher cost-to-originate world, it is more important for individuals to be positioned to his or her innate strengths.

The reality is that good salespeople are action-oriented and not a match for the administrative side of mortgage lending. It is a colossal mistake to think that someone whose strength is meeting, presenting/convincing and closing customers could also be an excellent data gatherer or compliance person.

All this investment in technology won’t help change sales results unless managers review their sales process and align positions to the strengths of their employees. You wouldn’t ask a quarterback to kick field goals so why should we expect originators to input data?

Isn’t it time to take a closer look at your sales organization structure and what activities originators are being asked to do?