A question that our clients frequently ask is this: Which CRM (Customer Relationship Management) software should we use? There are literally hundreds of options available, from the most popular solutions like Microsoft CRM, Sage, SAP, Act! and Salesforce.com to OpenSource applications like Sugar CRM. Many organizations have custom developed CRM solutions built on one of the many database products. Many even ask us why should we use CRM at all?
The second question is the easiest! A CRM solution provides your company with many benefits - enhanced productivity, increased revenue, improved customer satisfaction, reduced costs, and improved customer retention to name but a few.
Which CRM solution is right for your organization is a bit harder to answer. Let me begin with a bit of background for those of you just beginning to explore CRM solutions.
CRM Solutions typically fall into one of three categories: Server Based, Desktop, and Hosted.
- Server Based - Server Based applications are the most expensive solutions to implement and are typically used by larger organizations. These solutions are software that runs on one or more servers with-in an organization. Users connect to these applications either through software installed on their computer or through a web-browser. Examples of server based solutions are: Microsoft CRM, SAP, Sage CRM, and Clear C2.
- Desktop - Desktop applications are typically used by individuals or smaller organizations. They consist of software that runs on each user’s desktop with a local database. Some desktop applications allow users to access a shared database to exchange data. Examples of desktop based solutions are: Act! and Goldmine
- Hosted - Hosted solutions are the fastest growing type of CRM solution. With a hosted solution, users access the software through a web-browser. The database is located at the solution providers’ data center. This is typically referred to as "in the cloud". Examples of hosted solutions are: Salesforce.com and NetSuite. If you have a limited budget or want flexibility in the number of licenses, a hosted solution can be they way to go as most allow you to change the number of licenses on a month-to-month basis.
There are no absolutes here; most of the solutions are a
high bred of each. Hosted solutions may have a stand-alone Desktop product for when you can’t connect to the
internet and server based solutions may have a web-browser based interface. What our definitions deal with is the core of the software.
Next let’s take a quick look at what features to
CRM solutions give you. For most businesses there are a core set of features that are required:
- Leads - Lead Management is the core, keeping track of your potential customer and marketing to them.
- Contacts - Contact management is the ability to manage multiple people at a single account. For example the purchasing manager and the accounting contact.
- Accounts - Account management typically takes over when a "Lead" becomes a customer. It’s good to be able to separate Leads from Accounts to make Accounts easier to find.
- Opportunities - Opportunity management allows you to track specific sales potentials with your customers. Perhaps it’s an order for spring or their next production run. Opportunity management allows you to create Sales Forecasts.
- Sales Forecasts & Quotes - Sales Forecasts are a reporting and analysis feature. They give you a view of your potential revenue based on Opportunities and quotes.
- Activities - Activity Management allows you to manage your schedule. It schedules follow-ups with customer, manages appointments for you or your field sales staff.
- Customer Service - Customer Service management allows you to track support or service calls from your customers. Depending on your organization, you may or may not have a need for this feature but it’s available in many packages.
- Marketing Automation - Marketing Automation is sometimes referred to as Campaign Management. It allows you to track how effective your advertising and promotion efforts are and give you an ROI analysis. If you use web based PPC (pay-per-click) campaigns, this is a critical component for you.
All of the leading
CRM solutions provide you with most of these base functions. So, how do you choose? Well, the next set of criteria should help you flush out a few players. These are: Budget, Support, Flexibility, and Integration.
- Budget - While most of the CRM vendors will list this last, I always look at this first. Yes, it’s all relative. Yes, CRM will give you an ROI and save you "tons of money". But if you are going to have to spend thousands of (Dollars/Pounds/Euros/Yen/Kips) that would cause you to have to pawn the office coffee machine, it may not be worth it!
Solutions can range from "free" (in the case of open source or shareware solutions) to $30,000 + hardware for top end solutions. Most CRM systems are priced "per user license" also referred to as a "seat". Think about how much you can afford to spend per-user-per-year.
- Support - Next in the list of criteria is support. How are you going to get help if you need it? Typically the more you pay per/seat, the more support is available. Be aware however that many CRM suppliers charge for support separate from the user license. While on the surface, open source applications may seem inexpensive, if you can’t get to your customer data and you are waiting for some random individual to answer your post on a forum, it can become very expensive-very quickly. Make sure that the software vendor provides support and training or that you have a reliable source for assistance.
- Flexibility - Unless the CRM system you select is specifically designed for your industry and the way you do business, you will need to make some customizations. There are two considerations here; how easy is it to make them, and will they stay when a new version is released. Some of the CRM software listed here requires someone with dedicated programming experience; some allow significant customizations to be made through simple fill-in forms.
Generally, hosted solutions are more flexible and easier to use in this way. Also, systems that allow customizations are usually much better at retaining those customizations from version to version. You don’t want to spend hours and hours on customizations just to have to re-create them when you upgrade to the latest version.
- Integration - Lastly, but certainly not least, is Integration. Integration is the CRM solutions ability to talk to other software and systems you use in your business. If someone fills out the contact form on your website, you want that lead automatically loaded into your CRM system without having to re-type or cut and paste from your email. Or perhaps your staff needs access to order history, wouldn’t it be great to have one place to and see a complete history of a customer. With proper integration your CRM system can be a single resource.
Given all of these criteria how do you choose? I suggest looking over the websites of the major vendors and see which one has the features you are looking for in your budget range. Most vendors offer an evaluation program to let you poke around and see what the software can do. Another suggestion is to find a partner with experience in implementing
CRM systems to assist you in defining your need and evaluating the different solutions. Even if you have to pay a small fee for the consulting, it can be well worth it.
CRM systems take time to implement and commitment staff training and adoption. A good partner can assist you with the implementation; transfer of your existing data and with the integration of your other business systems.
By: Thomas
Lahey -
KSF International Inc