The Great Vendor Free Ride

“Nobody’s winning at this kind of game
We’ve gotta do better, it’s time to begin
You know all the answers must come from within
So come on and take a free ride”

–“Free Ride” by The Edgar Winter Group

Have you ever noticed that some vendors and products get a free ride at banks and credit unions? Some project proposals get pushed through the Steering Committee despite everyone involved knowing that not one iota of effort has been put into a “skin in the game” business case.

I’ve got a project proposal for your review, GonzoBankers. Imagine you’re a senior manager or director at a bank and receive the following Project Request form from one of your up-and-comers who really HAS TO HAVE this new multi-module enterprise-wide CRM product:

Seriously, how would you react to that stellar software request? You would likely choke on your morning bagel and call in the heavies from Procurement to taunt the requestor. But apparently these types of requisitions are working. How else could so many banks and CUs be clamoring for … you guessed it … salesforce.com?

Salesforce.com makes some admittedly cool software for CRM. Cool screens, cool navigation, cool customization, cool developer ecosystem, cool just about everything. They even have a cool user conference called dreamforce with hip, no CAPS spelling. They even sell out the user conference!

Except, not-so-cool when you have to justify the costs. Executives are hesitant to use math on this request. When you ask someone who has deployed salesforce.com how they justified it, you get responses such as:

• We couldn’t afford NOT to buy it.
• We had to try something.
• Ask me in 2021 when the project is over.
• We have to have that 360 customer view if we’re going to compete.
• Do you have a better idea?

SO WHAT?

The point is that without a clear commitment around business goals, salesforce.com risks being a Vanity Project – a project that looks good at 10,000 feet but gets a little warty as you approach ground level to discuss the specifics. The elevator conversation about it sounds good. You can brag to your friends and colleagues about your salesforce.com implementation. Reaction: “Ooh, this guy is serious about his customers!”

You can go to dreamforce and bliss out at the Lenny Kravitz show and hear such renowned business minds as Jenna Bush Hager, Barbara Pierce Bush and Ashton Kutcher speak. But unless executives want to stand up for increased revenue per customer, hard-nosed correlated increases in customer retention, more volume faster with the same staff, a salesforce.com investment is being driven by the emotion of hope but not the commitment of real change and sales goal achievement. No two ways about it.

And though I’m raining on your CRM parade, let’s be clear: there is definitely room for vanity projects in banking. Nothing says every project needs to have a home run business case attached to it. But usually those projects don’t come with the endless duration, heavy disruption, and beefy price tag of a salesforce.com project. Go ahead – mess around with finding non-Venmo P2P providers. Want to see if your customers like that spinning Money Desktop widget? Knock yourself out.

Regulatory must-haves and tactical, keep-the-lights-on projects are taking up the majority of available project time, leaving little time and few resources in the strategic project budget, let alone enterprise-wide Vanity Projects. If you really want to try for a strategically differentiating project that won’t make your CFO lose his mind, look to push the envelope on projects that maybe some brave executive will step up to owning from a measurable goals standpoint:

• Digital lead management engines like Marketo, Hubspot and yes, the Marketing Cloud module of the bigger salesforce suite
• Digital account opening and online fraud management
• Card rewards optimization and mobile self service
• Digital mortgage origination
• Commercial loan process automation with digital signatures

Vanity projects have always had a role in making Cornerstone Advisors’ gonzo customers better. We are certain that a more disciplined few of our clients will make their salesforce.com deployment successful in driving better sales and service processes. The point here is that, with very little time to push discretionary, strategic projects, the vast majority of banks’ and credit unions’ vanity projects should focus on the “Little ‘Test and Learn’ Journeys That Could” versus loosely defined “Enterprise-wide Odysseys of Dubious Outcome.”

Every strategic initiative should come under the microscope regarding its cost, risks, benefits and how it fits with the bank’s strategy. However cool it may be, a salesforce.com investment deserves the same scrutiny.