Hello, this is Matsubara, CRM Evangelist.

"Since we're a large company, we should have a robust CRM system in place."

However, in reality, a situation where "CRM has been implemented, but the adoption rate among employees is only around 30%" is widespread in large and medium-sized companies. Despite paying high license fees, data is not accurately accumulated, is not used for management decisions, and employees feel that "this is yet another unnecessary data entry task"—what is the root cause of this contradictory situation?

In this six-part series, we will explain how large and medium-sized companies can design and implement EMOROCO CRM Lite to create a "CRM that is actually used in the field."

In the first installment, we will provide a fundamental answer to the question, "Why doesn't CRM take hold in large corporations?"

Three structural causes of CRM failure in large corporations

Cause ① "Separation of designers and users" - IT makes the decisions and the field staff are forced to use them.

The implementation of CRM in large companies typically follows this process: management and the IT department define the requirements, the system integrator (SIer) designs and builds the system, and the completed system is deployed to the field—this is the so-called "waterfall" implementation model.

The fatal flaw in this process is that it results in a CRM that "IT and administrators want to create," rather than one that "the users on the ground want to use."

The design principle outlined in CRM 4.0—"Prioritize what helps the frontline staff over what managers want"—is being reversed in CRM design within large corporations.

Reason ② "Contradictions of a uniform design" - Imposing the "same CRM" on different tasks in each business unit.

In large and medium-sized companies, sales styles differ fundamentally depending on the business unit.

What happens when these three business units are forced to use the same CRM screen, the same input fields, and the same dashboard?

"We're forced to input information that doesn't suit our work," "The information we need isn't on the screen"—it becomes a compromise product that all departments find "difficult to use."

Reason #3: "The high cost of changes" - The system fails to keep up with the changing realities on the ground.

Customizing a large-scale CRM system requires the services of a dedicated system administrator or system integrator (SIer).

If the system continues to fail to keep up with the changing realities on the ground, the person in charge will start to think, "It's more accurate and faster to manage it in my own Excel spreadsheet than to input it into the CRM." This is the true nature of the pattern of "parallel use of CRM → CRM becoming a mere formality."

Four additional challenges unique to large corporations

Large and medium-sized enterprises face unique challenges that differ from those encountered by small and medium-sized enterprises (SMEs) when it comes to CRM failures.

Problem ①: Frequent changes in personnel – relationship assets are constantly being lost.

In large corporations, employee transfers, relocations, promotions, and retirements are frequent occurrences. In particular, in large Japanese companies, regular transfers every 3 to 5 years are commonplace, and situations where "a change of responsibilities occurs just as a relationship with a client deepens" are repeated.

If the CRM system doesn't record the "remembering of the person in charge," then "customer relationship assets" are lost every time there's a change in personnel. The larger the company, the greater the cumulative effect of this loss.

Issue ② "Organizational silos" - Customer information is fragmented across departments.

In large corporations, it's not uncommon for multiple business units to handle sales to the same customer. However, each business unit has its own separate CRM (Customer Relationship Management) system, leading to inefficiencies such as "Business Unit A has a close relationship with the president of Customer B, but Business Unit C is unaware of this and tries to approach them through a different channel."

Issue 3: "Data Governance Requirements" - Information security policies hinder the use of SaaS.

Large corporations, financial institutions, medical institutions, and government agencies have security policies that prohibit storing customer data on the cloud (external servers). This policy is a fundamental obstacle to adopting SaaS-based CRM.

Challenge ④: "Complex integration requirements for existing systems" - Integration with ERP and core systems is essential.

Large corporations operate ERP, accounting, inventory management, and call center systems that have been built up over many years. A new CRM system will become "another silo" (an isolated information island) unless it integrates with these existing systems. However, integration development is costly, and tight coupling makes future changes difficult.

"Large Scale ≠ High Quality" - The Paradox of Enterprise CRM

Here's an important paradox:

The quality of a CRM system is not determined by its size, price, or number of features. It is determined by **whether it is actually being used in the field, whether decisions are being made based on data, and whether the depth of customer relationships is being accumulated within the organization.**

It's clear which CRM is "truly working": a company that spends hundreds of millions of yen annually on a large-scale CRM but has a 30% retention rate, or a company that spends 150 million yen per month (1,500 yen per 100 users) on EMOROCO CRM Lite and has a 90% retention rate.

In the next installment, Part 2, we will explain how EMOROCO CRM Lite solves four additional challenges for large and medium-sized enterprises, based on the concept of "making enterprise functions simpler."
EMOROCO CRM Lite Product Page

Summary – Structural Causes of CRM Failure in Large Corporations

These problems become even more serious when additional challenges unique to large corporations are added (such as personnel changes, siloed systems, data governance, and core system integration).

Implementing a "large-scale CRM" and having a "functional CRM" are two completely different things.

next time:[Series Part 2: "Making Enterprise Functionality Simpler"—5 Reasons Why EMOROCO CRM Lite Will Resonate with Large Enterprises]

Related article:[5 Reasons Why CRM Implementations Fail, and How to Choose One That Will Avoid Failure]

Related article:[Is customer data an "asset" or a "liability"? The difference between CRM that simply accumulates data and CRM that effectively utilizes it]