Large companies have traditionally led the way in
developing and implementing software applications such as customer
relationship management (CRM) and Enterprise Resource Planning (ERP).
These software applications are business tools designed to optimize
certain processes and have a direct impact on company performance.
The drive behind the growth in CRM software was
the realization it is difficult to differentiate one's company in the
today's marketplace -- many companies now offer the same or similar
products at the same or competitive prices. Integrating and streamlining
internal processes became one of the few sources of competitive
Another recent business trend is that marketing
has moved from a brand or product-centered to a customer-centered
approach. Large companies began implementing CRM applications to help
capitalize on their current customers, allocating large amounts of time
and money into getting a system perfectly suited to their needs.
However, these solutions were complex and
characterized by relatively high initial purchase prices and a long and
expensive implementation process, with uncertain end-results. It was
very easy to spend almost $1 million for a proprietary CRM/ERP system.
According to some industry estimates, more than 60 percent of the
projects failed to meet expectations. One reason was that CRM was being
used to only track and manage sales rather than to improve service and
customer support. Another problem was that many projects were IT-driven
rather than implemented as part of an integrated business process.
Small and medium-sized enterprises with limited
budgets and IT support continued to miss out on the BeYond Horizons due
to the exorbitant cost and complexity.
However, in recent years a new market has emerged
that has leveled the playing field for these small companies. This
market includes fully customizable CRM and ERP systems designed to be
adapted by the end user and priced to allow even the smallest business
the opportunity to capitalize on business-specific applications.
This SME market is extremely attractive sector for
software application vendors in search of new sources of revenues. This
is due to saturation of the top-end of the software market, lower
penetration of enterprise applications in the mid-market hence a source
of untapped revenues and sales potential, and reduced presence of legacy
applications, which facilitates technology implementation and
integration and potentially favors the use of single software providers.
Today, there are almost 8 million SMEs in the US alone, with annual IT
spending of more than $85 billion.
(We use the U.S. Small Business Administration definition for SMEs,
which describes small enterprises as firms with less than 500 employees
and medium-sized businesses as firms with anywhere between 500 to 1000
THE FUTURE OUTLOOK FOR CRM
CRM has advanced to the point where it is no
longer viewed as just another software package but is seen and used as a
competitive tool. Every business will adapt CRM if they want to remain
competitive in their industry. Successful SMEs recognize this and
formulate strategies that will make them more competitive in Marketing,
Sales, and Customer Care and integrate them into a CRM application.
Another important market trend is solutions to
support increased demands for end user mobility. Leading firms are
embracing mobile CRM (mCRM) to improve productivity, increase CRM system
adoption, and enhance the customer experience. Mobile CRM is now a high
priority for many field sales and service organizations as it allows
reps to access and update CRM information anywhere they can use a mobile
device. This leads to several key benefits including improved service
scheduling, more professional sales interactions, and shorter cycle
times in areas such as quote generation.
Web services and service-oriented technology will
also become more central in both the users´ and vendors´ platform
architectures. In future, these Web services environments will become
the focal point for most application development and integration.
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