Customer relationship management (CRM) software is one of the most important tools small business managers and employees can have at their disposal. Instead of juggling contacts, tasks, proposals, follow-ups, correspondence, sales projections and whatnot in various email folders, documents, spreadsheets and sticky notes, they can have all the data related to customer interactions in a single, searchable repository.
And contrary to what you may assume, CRM software isnt just for salespeople or businesses that rely on selling. The tools and insight that a good CRM platform delivers can raise customer satisfaction for service-oriented businesses, increase donations and improve delivery of assistance for non-profits, and even keep a sole proprietor organized and on-task.
But selecting a CRM package is a big commitment, not necessarily in terms of money (although some platforms can get pricey) but certainly in terms of the time: configuring the system to match -- or ideally, improve -- your business processes, getting your data into the program, and training all stakeholders in how to use it. So you dont want to start down that road only to have employees slip back to their personal spreadsheets and Post-its because the system is a poor fit.
Shopping for Small Business CRM
This Buyers Guide should help you avoid that scenario. We present some of the most important factors to consider and features to look for as you examine CRM packages. At the end of the piece, we present an overview of some of our small business CRM favorite tools.
Sage ACT 2011 contact management software bumps up against the CRM category.
(Click for larger image).
Granted, CRM purists will howl at seeing some (gasp) contact management programs in that mix. And yes, strictly speaking there are differences between a CRM tool and a contact manager -- especially for mid-market and enterprise organizations -- such as support for team (rather than individual) sales/service activities, the capability to manage business processes among different team members and departments, and the availability of all customer interaction information in one repository visible to all stakeholders.
But over the years the lines have blurred, so from a functional perspective a small business may be just as well-served by a robust contact manager with CRM features as it would be by a born-and-bred CRM platform.
CRM Your Way -- On-site or in the Cloud?
The first thing to consider when examining CRM software is the type of platform you want: on-site software or a cloud product. Traditional on-site software gets loaded on your PCs or server, just like a typical office productivity suite.
While cloud-computing platforms are all the rage right now, on-site software has its benefits. For starters, there is no monthly subscription fee as there is with SaaS (software-as-a-service) offerings: Buy it once and its yours forever, and it wont cost you another dime until such time as you decide to upgrade. On-site software is also always accessible; with a cloud service, if your Internet connection is down you cant access your CRM data.
Of course, there are disadvantages to locally installed software, too. For starters, theres a bigger up-front commitment of capital to purchase the software compared to the simple monthly fee to get started with a SaaS vendor. Plus, you are responsible for keeping the system (meaning the software itself and the hardware it runs on) operational, and for backing up the data to be prepared for the unforeseen.
And if you want the latest features a product offers in subsequent versions, you have to pay for the upgrade, and then install it. Finally, most on-site software applications do not support full mobile access to all the features of the product.
Predictably, the weaknesses of an on-site CRM solution are the strengths of a cloud-based offering. First and foremost, a cloud offering delivers the full feature set to any Internet-connected users no matter where they log in. This makes cloud offerings ideal for small businesses that have remote workers, or employees that are often on the road.
Whats more, SaaS vendors are constantly upgrading their platforms and rolling out new features and enhancements on an ongoing basis. The vendor updates the software in the background, and the next time you log on, you have access to the new features. The SaaS host is also responsible for maintaining the servers that house the software and for keeping your data secure and backed up. Indeed, most providers back up to multiple data sites to ensure availability even if one location gets hit by a natural or man-made disaster.
On the downside, the monthly fee you pay for a cloud-based CRM package will eventually surpass what you would spend for on-site software. And as we alluded to earlier, if you dont have an Internet connection, you may be dead in the water. While many SaaS vendors offer a scaled-down local client applet you can use for times when you arent connected, such as on an airplane, the bulk of your data may not be accessible if you are offline.
When SaaS offerings first appeared on the scene, some would-be customers were worried about having their data out in the cloud and accessible to hackers. But those fears have not panned out; in fact, SaaS vendors generally have better security than most small businesses could ever hope to roll out on their own.
Small Business CRM for One -- or More?
The other main platform decision you need to make is whether you want a single-user or a multi- user system. Many desktop contact management programs with CRM features are meant to be used by one person; the data is not in a shared repository. That may be fine for a sole proprietor or individual sales folks looking to keep tabs on projects, prospects and clients.
However, the real value of a CRM platform lies in its capability to automate business processes across multiple team members -- and for that you need a multi-user system. Naturally, those are more expensive and complex to set up, but businesses that need CRM to coordinate efforts of salespeople, customer service personnel, mangers and so on will reap the benefits.
No matter which type of platform you choose -- cloud or on-site, single- or multi-user -- be sure the CRM vendor offers support for the mobile devices you use (or plan to use). At the very least, make sure you can sync your smartphone or tablet of choice to have the data you need with you in the field. And ideally you would have access to your full data repository in real-time from your phone or tablet.