Seven years. A thousand employees. Hundreds of consultants. $500 million. And one announcement that ended the whole thing.
Lidl, a German grocery chain with locations all over the world including 10,000 in Europe, 80 in the U.S., and plans to expand to another 500+ U.S. locations, earlier this year scrapped a technology project that was supposed to be the largest tech transformation in the company’s history.
Their mistake is big news for the software and grocery industry, and a huge fail for everyone involved, from the software maker to the consultants, and, of course, the tech leaders and executives at Lidl itself.
The story made the news, with analysts trying to understand what went wrong, and stakeholders pointing fingers at each other, but the bottom line is that their mistake was not all that original. It’s the same set of mistakes most companies make when implementing new technology.
And it failed in the same way many other technology implementations fail.
It just failed more spectacularly.
Ask yourself these questions to find out if your company is making the same mistakes that cost Lidl $500 million.
Are you wasting energy on the blame game?
When things go wrong, does your team devolve into finger-pointing? The salespeople aren’t cooperating, the sales leaders are lazy, the sales director messed up, the consultants were incompetent, the technology is flawed.
While we can’t know exactly what happened inside Lidl while they were hurtling toward their $500 million fail, in the aftermath, it became clear that there was not a lot of trust to go around. The consultants blamed the company, the company blamed the software provider, and internal “restructuring” provided evidence of plenty of internal finger-pointing as well.
Blaming someone for a mess-up is only helpful if it leads to change. Most of the time, it’s just an exercise in people trying not to take responsibility. Instead of pointing fingers, teams that succeed start by holding themselves accountable for their responsibilities, at the start, and throughout the implementation process.
Are you throwing good money after bad?
Have you over-invested in a system that isn’t working? Are you repeatedly investing more money in just “one more upgrade” that’s going to fix the whole thing? Adding plug-ins that ultimately are either discarded or add complexity to an already top-heavy system?
According to an article in German business newspaper Handelsblatt, Lidl purchased SAP at the beginning of the project to form the technology basis for their implementation, expecting to customize it to fit their needs.
As the project grew more complex, the software began to fail. Performance fell, and costs rose, as changes made to fit the needs of the organization undermined functionality that had been taken for granted at the start of the project.
“Altering existing software is like changing a prefab house,” says the article. “You can put the kitchen cupboards in a different place, but when you start moving the walls, there’s no stability.”
Sales organizations make this mistake all the time. They purchase the go-to CRM to form the backbone of their sales technology system, expecting to customize it as they go. But this is like purchasing a prefab house and expecting to have a custom kitchen.
As the complexity of the system grows, productivity falls. Salespeople get frustrated and stop using it. Functionality becomes cumbersome. More money is spent trying to fix what the earlier customizations made worse. Instead of a beautiful custom kitchen, organizations end up with a costly money pit that everyone hates.
Did you buy a popular CRM because it was the safe choice?
Remember when people used to choose IBM products because “nobody ever got fired for buying IBM”? That’s often the attitude in sales organizations in regard to the CRM. They invest in the well-known CRM product that everyone else is using. You know the one.
Usually, the purchase is made because it’s familiar and because the software company promises all the bells and whistles. That company spends tons of money to convince us that their product is the “one system to rule them all” and that it can be customized to do whatever you want it to do.
But the reality is that that software was built for the purpose of providing reports to managers, not for the purpose of making sales teams more effective. It is a glorified Rolodex with a lot of plug-ins added to make it look like an effectiveness tool.
The makers have never examined the backbone on which they built it, and it shows. Instead of a flexible productivity tool, it’s a cumbersome and costly pre-fab unit that does everything and does them all… mediocrely.
If you want your technology to align with your process, to make it possible for your sales team to execute on your strategy, you need to choose one that is built for the purpose and that provides the level of flexibility and the tools that you need.
That means you need to start with your strategy and choose tools that align with the strategy, rather than starting with the tools and trying to make them fit your strategy.
This week’s post is by guest author George Brontén, Founder & CEO of Membrain, a sales effectiveness software that makes it easy to execute your sales strategy by driving successful behaviors to consistently reach your targets in complex sales.