"CRM projects are notoriously complex, often over budget and frequently disappointing. . . . Research firm Gartner (Inc.) says that through 2006, more than 50 percent of all CRM implementations will be viewed as failures from a customer's point of view."
- from a Network Work Fusion article.
During the past few months there have been many stories about companies that set out to create comprehensive CRM and enterprise resource planning (ERP) systems only to find out they couldn't be built.
Last year Highmark Inc., a health insurer, sued KPMG Consulting Inc. for "tens of millions of dollars over what it says was the consultancy's failure to create a 'critical' electronic billing and accounts receivable system. Highmark said KPMG abandoned the two-year, US$15 million project [after running] over schedule by more than a year and attempted to charge the insurer an additional $8 million to complete the first phase of the project."
There could have been incompetence on either or both sides. But even if everyone involved - the corporation, the target users and the teams responsible for design, coding, implementation and configuration - is in agreement about what the brass ring looks like and how to grab it, once the carousel is in motion, nabbing the ring becomes impossible.
That's because of the complexity involved. Humans, even with computers, can build only to a certain level of complexity, because there are real limits to our ability to extract information from data.
Complexity Theory is a branch of science that attempts to model systems that are, well, complex. Its central idea is that simple objects create elaborate and unexpected behavior through interaction.
Moreover, it suggests that "critically interacting components self-organize to form potentially evolving structures exhibiting a hierarchy of emergent system properties." That means that a system can do things you never imagined.
To sum all of that up: Put some stuff together that does anything more than just sit there and rust, and if it interacts you'll get more than you bargained for.
Is it any surprise then that these CRM and ERP projects, which verge on megalomania, frequently fail? But if some control freak executive gets it in his head that "We can build a total solution" and persuades others that this idea is the truth and the light, surprisingly many corporations just can't say no.
Dick Morley, the man who invented the floppy disk, once said of factories, which are hugely complex systems: "You don't have a prayer in hell of ever understanding factories. You really don't have control. By striving to get control, you only make it worse." The same applies to CRM and ERP in spades.
Now to add to these grandiose corporate control fantasies we have a new one: grid computing.
According to my Network World colleague, fellow columnist Frank Dzubeck: "[A] grid is an amorphous IP network that links heterogeneous servers, storage devices, clients, appliances and software to form a transparent virtual resource that can be dynamically allocated, accessed and shared by users and applications."
Sounds sexy but let's get real. The complexity of such solutions, if they are to be enterprise scale, will lead to vast expense and huge management overhead, and a whole new universe of problems.
And imagine the problems that we'll have when CRM and ERP systems rely on grid infrastructures!
We, the high-tech culture, radically overestimate our ability to handle complexity and what we can build, and underestimate our ignorance of how systems really work.
As a wise sage once wrote, "Keep it simple, stupid."