CRM will wait…

Pro

1 April 2005

There is a large debate raging within the IT industry as to whether businesses should opt for dedicated customer relationship management applications, and if so, if they should subscribe to the software as a hosted service rather than installing it on a server and on PCs in-house.

With a total of more than approximately 13,300 customers and approximately 214,000 subscribers as of Dec 31st, 2004, Salesforce.com is the world’s most widely used on-demand CRM solution and has driven the market to deliver the software as a service with Siebel following suit. Salesforce.com’s proposition is simple, small companies pay €1,050 to allow five employees to access a web-based secure software through the browsers on their PC. This service has revolutionised the market in that previously it would have cost anything over a €100,000 to install a fully-fledged CRM system. This was clearly outside the reach of small businesses in Ireland. Now full CRM functionality is at hand for a relatively small fee. Microsoft has its own CRM package that is designed to be installed on a server and on client PCs.

Is your company ready?
Having this very smart technology with an affordable price tag is great but the debate for me is not which CRM software solution to opt for but rather firstly to understand what CRM means and whether your business is ready for it? In technology terms it is very clever software that provides comprehensive customer information, triggers employee actions and pulls off clever automated marketing feats. In business terms, every manager knows that it’s about serving your existing customers in the best way possible by offering them the best products possible to suit their needs, by marketing them appropriately and by providing the best customer service possible to retain them. Technology alone won’t allow a company in succeed in these areas, it’s the people within the organisation that achieve this. What can be said is that technology has a part to play in assisting these people when resources are limited and every member of staff needs to have a thorough understanding of dealings, and the needs of customers.

Use Outlook first
Neil Tanner, business group lead, MBS, Microsoft, argues that most small businesses in Ireland are not ready for fully-fledged CRMs solutions: “They are at step one, good contact management, where company employees can track all of the information about a customer or prospect in one place.” Tanner would argue that company should leverage their existing Microsoft infrastructure to get basic contact management and then work towards developing what the IT industry would define as a CRM system. Most small businesses are using Outlook as their default e-mail application and Microsoft offers Business Contact Manager – a product that sits alongside Outlook’s e-mail and calendar feature and allows company employees to perform what Tanner describes as “basic opportunity management”, all activities and dealings with a customer can also be seen in one view. Business contact manager is cost-effective as it comes as part of Office 2003 Professional.

Low CRM penetration
In technology terms, most small businesses are already using or are ready to adopt contact management rather than dedicated CRM applications. This is confirmed by IDC research figures which show 6% usage of CRM systems by small companies here. Contact management is having all of the information about customers in one place and letting your employees have access to that information at all times. CRM, in technology terms, is a more advanced animal which allows companies to deeply configure company workflow such as the sales process, defining triggers that get all of the team involved on a sale if required, or a higher level service engineer if the customer service issue is of a very serious nature. The consensus on the best way forward seems to be get the right consultant that can firstly introduce your company to what contact management can offer, and if your business needs outgrow that then look at moving up to a dedicated CRM product or service.  

14/03/05

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