Depending on whom you talk to, CRM started somewhere between the mid 1980's and the early 1990's, with efforts from companies such as Oracle, PeopleSoft, Siebel Systems, and System Applications and Products (SAP). But true CRM, involving not just the accumulation of static customer databases, but also a genuine enhancement of business processes, began only recently, around the turn of the millennium. This evolution of CRM would not have been possible without the increasing influence of the Internet and the development of web services. The Internet has connected multiple business systems together despite being in different locations and implemented using different technologies.
Originally, CRM systems from the big four companies named previously were uniformly expensive, required heavy customization, and were unwieldy for any but the largest firms. In 2001, Siebel Systems had sales worth US$2.1 billion, based on a business model in which each customer spent millions of dollars implementing the software they produced. However, their market share and gross sales slipped in later years as the built‑for‑the‑web generation of medium-size CRM systems came to market from firms such as Salesforce.com, NetSuite and other vendors who have since ceased operations.
Years from now, history is likely to show that the introduction of SugarCRM in 2004, revolutionized the CRM marketplace by eliminating financial barriers, that in turn allowed smaller firms to gain access to the latest CRM technologies.
One easily identifiable trend is that since 2000, the market has been rapidly moving to web-based CRM tools as indeed it has in many other business application areas. The advantages are many: ubiquitous access, efficient use of expensive user licenses, and simplified integration with other business systems through web services.
Some of the more highly-regarded CRM solutions available for smaller business today include the following:
NetSuite (http://www.netsuite.com/): This firm offers NetSuite CRM+ and other solutions. One of its main differentiators is its ability to seamlessly integrate CRM with their Financial and E-Commerce solutions.
Salesforce.com (http://www.salesforce.com/): This firm is one of the key champions of the software-as-a-service model. While a popular solution, the Salesforce.com CRM is often perceived as one of the more expensive options. Salesforce.com has led the field in innovations, such as end-user customization, and Application Programming Interfaces (APIs) for business process integration.
Microsoft CRM (http://www.microsoft.com/crm): In spite of not being one of the most cost-effective solutions, Microsoft CRM offers a rich feature set and easily incorporates itself into the already existing Microsoft based infrastructure such as, Microsoft Small Business Server.
SalesLogix (http://www.saleslogix.com/): Sage Software (formerly Best Software) produces this leading CRM for smaller businesses, as well as ACT!, the leading contact management software. It offers great functionality, but is widely recognized as a costly solution.
In today's CRM market, there is not only a choice of vendors, but also a choice of deployment options. The options are as follows:
On-Demand or hosted model: The On-Demand model (a phrase popularized by IBM advertising), formerly known as the Application Service Provider (ASP) model is the simplest (and often, the most expensive) way to implement and adopt a CRM solution. The CRM vendor simply hosts the CRM application, and provides the customer with a URL (Universal Resource Locator or a web address) at which to point their browser. No fuss over software installation, no messy application patching and maintenance, but also, no data on your premises—the vendor keeps it all on their systems, a fact that makes many customers uneasy.
On-Premise: The On-Premise option is the one that the industry has practiced for years. The vendor licenses you its application software, and in turn you install the software on your own server, taking up the responsibility of not only maintaining and securing the server, but also your data. You also take on the responsibility for maintaining the software as it evolves, maintaining and backing up the server and data, and for the maintenance of the network infrastructure to which the server is attached. These are things you are not going to do without access to some fairly knowledgeable computer networking people, either your staff, or whose services are retained on a regular basis.
Hosted application pack: An intermediate version of these two models, that many businesses find attractive, involves licensing the software, but then hiring a hosting firm to provide and maintain the server on which it runs. Of course, the concerns about offsite data remain.
Server appliance: The Server appliance option involves purchasing a server, pre-loaded with licensed software. This reduces concerns about installation problems and the capacity and performance of the server you might use yourself, but does not eliminate the problem of maintaining and updating the server and its software image, as well as backing up your data.
You should be aware that not every vendor supports all deployment options. Some of the best known medium-size vendors only support the On-Demand model, including Salesforce.com, and NetSuite. While all the 'No Software' talk (especially from Salesforce.com) can sound attractive, you may have to balance that against the monthly per-user licensing costs and the thought of having someone else holding on to all your customer data.
That being said, network technicians are not cheap either, and backing up your data regularly is not something every small business is set up to do well. Different models will appeal to different organizations. That is why this range of choice exists!