CRM Part 3: Putting in the groundwork

18 May 2004

With so many software companies offering products to help you optimise your relationship with your customer, the hard part is not deciding that you need CRM (customer relationship management) but trying to choose the product or service that will best suit your business. CRM projects have a tendency to become lengthy and expensive, so ensuring you choose the right software is a vital first step.

The first decision you need to make is whether you will go for a product that is installed and runs on your own server in your premises, or whether you will go for a hosted solution whereby the software is rented to you on a monthly basis by a service provider and accessed over the Internet.

The latter so-called “on demand” model has been successfully pioneered in this space by, which has about 140,000 users of its service worldwide. No doubt inspired by that success Siebel now offers its own hosted service, CRM OnDemand; while according to Neil Tanner, Microsoft’s Business Group Manager, Microsoft expects to offer its recently launched CRM product as a service within 12 months.

According to Fergus Gloster, a director of’s European operations, the major advantage of software as a service is that you have shared access to your company information anywhere that you can get an Internet connection. “It sounds trivial but it’s the most important thing,” says Gloster.

“Imagine you are the owner-director of a small company and you are going to meet a big customer in Clare. You’re doing ‘the grand tour’ so you’ve been out of the office for a couple of days but you’re staying in a hotel in Ennis and can fire up your laptop and find out all the information about that customer. Whether it’s good news or bad news you’ll be prepared when you go into the meeting.”

Despite this and the other advantages of the service model – such as no upfront capital costs and a monthly payment structure – when it comes to CRM most companies still like to keep it in-house. A major factor in this decision is the psychological comfort of having all of your customer data stored in-house on your own systems rather than entrusting it to a third party.

Microsoft researched the needs of small to medium sized businesses before it introduced its product to the market. Neil Tanner says that one of the key things that came back is that businesses want to integrate and connect their core business processes such as financial management, customer and sales management and the supply chain.

One advantage of the Microsoft approach is that it integrates with an existing product that users are familiar with – Microsoft Outlook – which should produce savings in training on a new application and increase the chances of user acceptance. “People are using the diary and contacts in Outlook for customer management in Outlook anyway – we’re just developing a front end on that,” says Tanner.

Microsoft is not the only company that has realised integration with Outlook is a quick and efficient way of delivering CRM to small organisations. Waterford Technologies’ recent acquisition of DPD International has added the Gold Interaction suite to its product line – a set of applications that provides customer management through the familiar outlook interface. “The failure of CRM has been down to user acceptance – people don’t want to change the way they work,” says Colin Finlay, sales director for DPD products with Waterford. “From the user point of view they want a single view of the organisation, which means you have to integrate easily with other applications.” Finlay believes it is vital that CRM packages don’t just focus on the sales function but will also be used by accounts, support and anyone else who interfaces with customers.

Glynis Elrington of Sage Ireland suggests a “shopping list” of key features that potential buyers should use to evaluate software. On the top of that list are ease of use and customisation (“if you can customise it yourself you can save thousands on consultants”); scaleability and simplicity. If those needs are met Elrington says internet and mobile access are “nice to have, but the desktop is where it matters.” Overall Elrington says that any CRM product that is going to work should adapt to your needs as a business rather than requiring you to change the way you do business to satisfy its logic.

If you are attempting to put the customer at the centre of all your business, it’s essential that your CRM system can integrate with the other applications you are using in your business. Noel Shannon, Managing Director of Prostrategy, believes Microsoft CRM has an advantage in this regard. “Because it is based on .Net it will integrate with all future Microsoft products. Integration and compatibility is a much bigger issue than people think,” says Shannon.

Fineos supplies its CRM software to banks and insurance companies. Its CEO, Michael Kelly, says that a product that can allow a customer to serve themself online is “utopia” for a business. “You can give the customer what they want in real time and the great thing is that the customer or the broker is doing all the work for you.”

He suggests that the key to finding the right CRM product for your business is by looking around your own industry and seeing what successful companies are using. “Talk to others in your industry to see what’s working,” says Kelly. “Find a software company with experience of your niche – why re-invent the wheel?”

By John Collins