Is Your Medium-sized Or Small Business Ready For Crm?

Not every business needs a customer relationship management (CRM) application. For medium-sized or small businesses with simple products or services, customer information can be stored in the mind of the owner--you. Nevertheless, as your small business grows and relationships become more complex, the amount and type of customer information you have will exceed your capacity to remember it.

You might turn to an Excel spread sheet or other desktop application to help you keep track. But as this information is recorded, it can also become fragmented--stored in a variety of places. How do you ensure that you and everyone else who needs it has access to this information? Spreadsheets just won't cut it.

The answer is CRM. By collecting customer information in a single location, CRM gives you the best possible understanding of your customers and their experience with your business.

Knowing When Your Small Business Is Ready For CRM

The CRM wake-up call for most businesses is usually something negative. Your top-performing sales person leaves and takes all his customer contact data with him. Or, while service is trying to help a frustrated customer, your sales team tries to upsell him. So he dumps you. Here are some other signs that it's time to consider CRM:

1. Sales spends too much time preparing for sales calls or writing reports

2. Marketing can't easily assemble lists of prospects

3. Service treats every problem as new because it lacks customers' service histories

4. Fulfillment asks for details common to every order every time

The common denominator is having data in the right place, in the right format, at the right time. Although it's impossible to keep this information in the minds of all of your employees, your customers want to believe that you care enough to make it available to them when needed. Not doing so equals not caring.

CRM For Small Business: Opportunities And Challenges

When it comes to CRM, a medium or small-sized business is in a unique position that offers opportunities for deriving value and challenges that larger businesses have a greater ability to overcome.

Opportunities

1. You Start With A Clean Slate

In many large organizations, the introduction of CRM requires integration with or the replacement of legacy systems. And that typically means a long process of data scrubbing and reformatting.

You might have years of Post-it notes and Excel spreadsheets but not years of data trapped within legacy software. You can skip the data rationalization step that often delays CRM deployment at larger companies. Plus, you can establish sensible data management strategies right away--before silos proliferate and data volumes become overwhelming.

2. You Already Have Customer Relationships To Use As Models

Growing small businesses still have one-to-one relationships with their customers. So you can use current relationships to map what works and use that map to model processes in CRM. That way you can build meaningful personalization into your CRM system right from the start while preserving the high touch nature of the relationships you have. For example, you can ensure that staff knows whether a customer likes new product recommendations—or finds them annoying.

3. You Have Fewer Regulatory Hurdles To Overcome

The privacy, reporting, and data storage regulations that big companies have to deal with--especially if their activities cross borders--constrain their use of CRM and the kinds of information they collect.

Most medium-sized and small businesses live in a simpler regulatory world. In the U.S., some must comply with HIPAA and Sarbanes-Oxley, but many do not. This enables small businesses to build solutions that suit their current situations, while they stay aware of changing regulatory demands.

4. You Can Easily Grow The Use Of CRM Across The Company

As your business grows, CRM will help you see how customer information can benefit every part of the business. For example, marketing may hear ideas from customers that manufacturing should know about. Having a cultural commitment to knowledge sharing--like you did when your business was small--will enable you to continuously spot new uses for CRM.

Disadvantages

1. You Have Budget Limitations

When it first emerged, CRM was a tool that only large businesses could afford. That's changed with the advent of CRM delivered as an on-demand or software-as-a-service (SaaS) product, which means you don't need to invest in technology infrastructure to gain the benefits of CRM. Nevertheless, budget limitations may force you to look very carefully at things like customizations and consulting.

2. You Have Fewer Personnel Resources

Unlike large companies with marketing, sales, and service staff, you probably have some people doing several jobs or even one person doing all those activities. While CRM can automate certain tasks, it still needs to be set up and supplied with data. This requires time that may be in short supply. Don't invest time in a CRM implementation before your business ready. It can lead to a negative experience that results in low user adoption.

3. You May Lack Technical Expertise

If your budget allows, you can initially use consultants to supply technical expertise. But over the long term, someone in your business will need to acquire rudimentary technical knowledge of your CRM system. This is another area where time required for CRM may conflict with priorities in other parts of the business.

Finding The Right CRM Solution For You

To choose the right CRM solution, you need to know two things: your business needs and how those needs map to what the CRM market has to offer. An outside consultant, integrator, or reseller can guide you during this process. These professionals can help you select the right CRM product for your needs and your budget, deploy your system, and train the people in your business who use it. Though not inexpensive, these services can help you avoid selecting the wrong CRM product, which in the long run will be more costly as well as counter productive for your business.