
CRM implementations can be tough — and if your first attempt didn’t go as planned, you’re not alone. Many distributors face similar challenges, with high failure rates across the board. But here’s the thing: that initial investment, while frustrating, isn’t a sunk cost. Instead, it can be the foundation for future success if approached strategically.
Forward-thinking distributors understand that despite past setbacks, CRMs are indispensable, just like ERPs. The key is not to shy away from the challenge but to learn from it.
To turn your CRM setback into a win, start by identifying what went wrong.
Root Cause of Failure #1: Lack of Buy-In
If there isn’t buy-in from the top, a CRM will fail. Getting internal buy-in for the CRM from the CEO and sales leadership is a crucial first step to a successful CRM implementation.
But the strongest headwinds working against an implementation sometimes come from an unexpected place: the sales team. All too often, business leaders assume that if they hand their sales team a new CRM, they’ll adopt it, and a new sales process will organically emerge.
In reality, if sales reps don’t understand how or why the new CRM will directly benefit them, they won’t see a reason to invest time and effort in learning new ways of doing things. And that lack of commitment can wind up passively sabotaging the entire CRM implementation.
Avoiding this trap takes intentional goal-setting as well as ongoing conversations with frontline sales reps to get their buy-in early on. End-users need to understand specifically how and why a CRM will help solve persistent problems that hold them back, and serve as a springboard that makes it easier for them to achieve their goals.
If done right, you’ll deliver a tool your team members have already told you they need and are eager to use.
One way to get buy-in is to involve stakeholders during the CRM selection process.
Researchers at Harvard Business School termed the IKEA Effect after a series of studies found that when people expend labor on a task, such as creating or assembling items, they tend to value them more because they invest significant effort (effort justification), feel a sense of ownership (endowment effect) and feel pride for completing the task (sense of accomplishment).
Root Cause of Failure #2: Fear of Sales Reps
Recently, we sat down for dinner with a regional president from a large electrical distributor. After working his way up in the distribution industry, he’d earned well-deserved kudos for transforming the company he leads.
So we asked him why so many companies hesitate to change the expectations of their sales reps, even when they know they need to.
His answer: “Because they’re scared of their sales reps.”
Sales reps own the customer relationships, and the more talented they are, the closer those bonds are likely to be. The downside is that if they choose to leave the organization, they may succeed in taking customers with them.
And it’s not just the customers at stake. Sales reps have valuable knowledge and institutional memory that may be lost to the organization, especially if they haven’t previously been required to track their notes, activity and other mission-critical information as part of their day-to-day workflow.
This can create a kind of hostage situation in which leadership lives in fear of making necessary changes that might alienate sales reps.
How do you overcome this challenge? The answer is all about culture and compensation. You need to start by clarifying the principles your company lives by and weaving them into the fabric of day-to-day decision-making at every level of the organization. Once you establish this cultural groundwork, you’ll need to implement new compensation plans and responsibilities that are aligned with those values.
As part of this process, accept that there will be some changing of the guard: People who aren’t culturally aligned will be managed out or leave on their own. You may even lose some high performers. But the short-term loss will be balanced out by building a stronger foundation for long-term success, with everyone rowing together toward shared objectives.
Some of the companies we’ve seen successfully implement CRM have a no-tolerance policy for reps who don’t use CRM.
A VP of Sales at a distributor of beauty products that has successfully made this shift of mindset puts it like this: “I don’t need you to be my IT guy, but I need you to know how to log a call note in the CRM.”
Root Cause of Failure #3: Wrong System for Distribution Needs
Aside from the cultural questions, a nuts-and-bolts issue can stifle a CRM implementation right out of the gate: choosing a system that wasn’t built for distributors.
Many common, general-purpose CRMs aren’t designed to address the needs of distributors — and they may not integrate well with distributors’ ERP systems.
This goes hand in hand with the fact that many distributors fall into the trap of hiring third-party consultants who lack a deep understanding of the distribution business. That almost inevitably leads to a system that isn’t a good fit for the company’s needs.
Here’s why distribution-specific CRMs are more effective:
Native integrations: For most distributors, their ERP is their core system. General-purpose CRMs typically struggle with ERP integration because their customers span dozens of industries, many of which don’t require an ERP integration. By contrast, a distribution-specific CRM will natively integrate with the key systems distributors use.
Less customization required: A distribution industry-specific solution is designed with distributors in mind. General CRMs need significant customization to support distributors’ needs. Want to load transaction data from your ERP into an all-purpose CRM? You’ll probably need to hire an expensive outside consultant. Distribution-specific CRMs include this capability out of the box, which saves distributors time and money.
Industry-specific features: General-purpose CRMs lack features that are tailored to support distributors’ workflows. Distributors are unique in that they serve thousands of customers, sell millions of products and operate across multiple sales channels.
At Proton, we built AI-powered product recommendations into our CRM to help sales reps predict what customers might want to buy or reorder. Turning noisy data into relevant insights is helpful for distributors in a way that wouldn’t be as beneficial in other industries.
Overcoming a Failed CRM Implementation: Steps to Recovery
With all the above in mind, here are the crucial steps for success with your CRM implementation.
Commit to Change: Leadership must fully commit to a new CRM strategy, driving the initiative from the top down.
Involve Your Team: Make sure your sales leadership participates fully in the CRM selection process and roll-out, so they feel invested in the outcome.
Choose the Right Tool: Select a CRM that’s designed specifically for distributors so it aligns with your business needs and integrates seamlessly with your ERP systems.
Invest in Training and Support: Provide comprehensive training and ongoing support to help your team adapt and use the new CRM effectively.
The first and most essential step toward successful adoption is understanding the reasons for CRM failure.
By acknowledging past mistakes and taking carefully considered steps that draw on those lessons, distribution leaders can put previous CRM failures behind them and achieve success in a way that also strengthens their organizational culture which will pay dividends for other endeavors as well.
Benj Cohen is the founder and CEO of Proton.ai.