Solution Overviews » Management » Customer Relationship Management (CRM)

Customer Relationship Management (CRM)

Author: TechShortcut Staff | Article updated: January 18, 2009

1. Overview

Customer Relationship Management (CRM) includes any applications that are customer-related. CRM typically includes the following:

Contact and Lead Management
Sales Force Management
Partner Management
Customer Service
Reporting and Analysis

Benefits

Manage your sales and customer service functions more efficiently and effectively so you can do more work and reduce costs.
Increase visibility into customer trends to adjust strategy

Considerations

Below are some factors to think about when deciding whether CRM software may be the right fit for you:

Application Type
CRM functionality can be found in stand-alone applications and within other business management applications. You will need to weigh the benefits and drawbacks of each approach relative to your business needs. For CRM and individual application approaches, keep in mind how integration will be handled for key customer information like contact data, orders and inventory. Shown below are the types of applications to consider.
- CRM Suite
- Niche/Vertical/Industry CRM Suite
- Accounting/Business Management/ERP Suite
- Individual CRM applications
Define Requirements
Since CRM suites include many applications, it is crucial that you first draft the requirements of what your business needs.
Number of Customers or Salespeople
Do you have enough customers or salespeople to justify the expense?
Number of Users
Ensure that the CRM application will be a fit for the number of users you will need over the next several years.

Features

Sales
- Sales pipeline management
- Partner management
- Sales orders
Customer Service
- Help desk
General
- Contact management
- Reporting and analysis
- Communication - the ability to initiate, receive and track all communications for a customer in any communication channel.
- To-do lists and reminders

Implementation Options

1. In-House CRM Software	2. Internet CRM Service
Software is installed on a server or web server.	Rather than add software to your web server, you can use an Internet service that will host the application for you.

2. Option Comparison

	1. In-House CRM Software	2. Internet CRM Service
Requirements	See hardware and other cost factors below. You will need to add or rent the infrastructure to run the solution.	A PC with a web browser and an Internet connection - preferably DSL, cable or T1.
Cost Factors	Hardware
	Most systems will require a server to host the application software and a database. Depending on the number of users and the type of application, more servers may be needed. A backup power supply.	None
	Software
	Software license cost for the application and possibly the database.	Not applicable
	Labor
	Installation, configuration, backup and maintenance of software	Software configuration
	Services
	Utility cost for hardware and environment	Typically a monthly fee per user
Anywhere Access	Possibly	Yes
Multi-user Access	Possibly—Depends on the software	Yes
Electronic Backup	Not included, must be included in your in-house backup.	Some form of backup is typically included
Security	Security depends on the quality of your technology environment.	Data is being placed in someone else's hands, however Internet services are usually on top of security measures.

3. Next Steps

It is not possible to offer general direction on which implementation option to choose because there are simply too many functional and technical factors to consider. While an Internet service will greatly simplify the technical management of the solution, it may not necessarily be the cheapest option. On the other hand, an in-house solution may require you to create or rent your own data center which has the potential to be a technical management issue.

If you are pursuing an enterprise-wide solution to help you streamline your customer relations, the solution may represent the largest technology investment for your business. It can not be stressed enough that you need to carefully evaluate how you currently do business and how new software may affect your business process. You must know what you are getting before it is implemented which is no small feat. You should also plan for what you will need over five years to ensure you don't outgrow the solution too quickly.

Estimate the Benefits
Do you expect to save costs through increased efficiency or do you expect to be able to handle more business? If possible, make projections of gains to get an idea how long it will take the investment to pay off.
Document your Key Business Processes
Documenting your business processes will help you and any tech service providers ensure that business needs are identified and met.
Do a Fit/Gap Analysis
Evaluate each business need against each application to identify whether there is a fit. If a gap is identified, specify how it can be addressed.
Schedule Demonstrations
Try to get a demo that walks though a business process similar to yours.
Compare Costs Carefully
Both in-house and Internet services have many cost considerations so ensure that you are looking at the entire picture.

For more on evaluating implementation options and finding help see the following guides:

	1. In-House CRM Software	2. Internet CRM Service
Find Local Tech Specialists Search TechShortcut's tech profiles for specialists in your area	CRM "Customer Relationship Management"
Find More Information Use Research Helper to find related web articles	CRM Application Software	CRM Online Service
Examples of Products and Services These are not endorsements, simply some product or service names we encountered in our research to get you started finding your best fit.	Microsoft Dynamics CRM Sage ACT! Sage CRM Sage SalesLogix Soffront¹ SugarCRM² ¹ Offers a hosted/on-demand option ² Open source	Microsoft Dynamics CRM Javelin CRM NetSuite CRM+ Salesboom SageCRM.com Salesforce.com SugarCRM¹ Zoho ² ¹ Open source ² Offers a free version

1. In-House CRM Software

2. Internet CRM Service