Why should a small business implement a Customer Relationship Management (CRM) solution?
Customer Relationship Management (CRM) has a reputation for being expensive and hard to align with organizational goals. The horror stories of Enterprise level project failing miserably are legion. However, small and medium-sized enterprises (SMEs) are now waking up to the benefits of CRM technology, as they increasingly recognize that the technology can make a tangible difference to their bottom line.
CRM, despite the highly publicized failures, has enabled large organizations to serve customers more intelligently, develop markets and change the way they do business delivering levels of service that were previously unthinkable. As markets become more open and the use of technology and the internet opens up, the larger companies are increasingly able to compete with small business at a service and price-point level. SMEs therefore need to become more customer focused in order to complete with larger businesses.
A recent 1000-person customer relationship survey, conducted by Sage, indicated that SMEs need to take a lead from larger companies that have embraced technology and the way it can tightly focus on individual customer needs. 43 per cent of survey respondents say the information they receive from large companies is most useful (compared to just 10 per cent from smaller companies). These findings suggest that larger companies are taking advantage of technology and delivering customer needs more effectively. But in today’s business environment, there is no excuse for SMEs not taking CRM seriously as developments in the last couple of years have led to solutions that are affordable and simple to deploy for any small business.
Service driven, Customer led
According to Gartner, CRM is now firmly back on the agenda and was the most frequent search term on www.gartner.com in 2005. The rise of CRM has not been driven by the vendors but instead, SMEs are demanding it. There are a number of reasons for this. First, they increasingly recognize that customer data can not be stored in paper files, spreadsheets or email programs. Such information is often unavailable at the right time, hard to present for analysis and easily lost, putting the business at a significant disadvantage.
Second, businesses recognize that using the same technology as their customers gives them a competitive advantage. Dealing with transactions and processes in supply chains is time-consuming and costly so tight integration (such as via an enterprise portal) can be a critical differentiator that shuts out potential competitors.
Focus
The key factor for successful implementation of CRM technology is focus. In fact, some analysts say that the lack of focus that is found in larger enterprises is the cause of many CRM implementation-related problems.
SMEs need to focus on business alignment – they must invest resources on people issues, process and technology all at the same time. This three-pronged approach means that interest in CRM can be built quickly and maintained as SMEs are able to roll out CRM to specific areas of the business. The systems can then be extended throughout the business until a consistent view of the customer is gained wherever it is needed. Large enterprises have historically found this alignment difficult to achieve due to siloed business functions, varied management interests, politics, and significant differences in the way customers make contact.
One way that SMEs can take advantage of the technology is by adopting a web based CRM strategy. There is no hardware to buy and no software to buy: you just sign up online an go! You can also have the systems tailored to suit your business needs exactly and often at a very competitive price. Customer Relationship Management is now a killer application for all businesses regardless of size and as costs come down more and more smaller businesses are taking full advantage of the opportunities and benefits available through the hosted CRM or web based options.
Chic McSherry
CEO
iport4business.com
Sources: Sage, Gartner
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