Depending on whom you talk to, CRM all started somewhere between the mid 1980’s and the early 1990’s with efforts from companies such as Oracle, PeopleSoft, Siebel Systems, and SAP. But true CRM involving not just the accumulation of static customer databases but a genuine enhancement to 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 for connecting multiple business systems together despite their being in different locations and implemented in different technologies.
Originally, CRM systems from the big four companies named above were uniformly expensive, heavily customized, and unwieldy for any but the largest firms. In 2001 Siebel Systems had sales worth 2.1 Billion USD based on their model in which each customer spent millions of dollars. But their market share, and indeed gross sales, slipped in later years as the built‑for‑the‑web generation of mid-size CRM systems came to market from firms such as Salesforce.com, NetSuite, Upshot, and SalesNet. Now Upshot has been purchased by Siebel Systems, and they seem to be somewhat on the upswing again.
With the introduction of SugarCRM in 2004, history will show that there has been yet another revolution in CRM, as even smaller firms gained cost-effective access to the latest in CRM technologies. For small-to-mid-size firms, NetSuite and some of the other mid-size generation are also becoming a viable option financially.
One trend easily visible above is that since about 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, making the best use of expensive user licenses, and easier interfacing with other business systems via web services.
Some of the more highly-regarded CRM solutions available for smaller business today include:
NetSuite ( http://www.netsuite.com/): This firm offers both, NetSuite Small Business, a combination of accounting software and CRM, and NetCRM, its successful stand-alone CRM product.
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/smallbusiness/products/mbs/crm/detail.mspx): In spite of it not being one of the cheapest, or most highly regarded solutions, Microsoft CRM is still one to watch out for. It’s Microsoft—known for never giving up on becoming number one in a market. If you use Microsoft Exchange and Small Business Server, it is a real option, but if you don’t, it may not make sense for your business.
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.
In today’s CRM market, there is not only a choice of vendors, but also a choice of deployment options. The options are:
On-Demand 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. 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 its system, a fact that makes many customers uneasy. Recent surveys show a full 50% of businesses are not prepared to adopt this model.
Application Pack: The Application Pack option is the one the industry has practiced for years. The vendor licenses you its application software—often on an annual basis. You install the software on your own server, and take responsibility for your own data. You also take responsibility for maintaining the software as it evolves, for maintaining and backing up the server itself, and for the support of the network infrastructure to which it is attached. These are things you are not going to do without access to some fairly knowledgeable computer networking people—either on your staff, or whose services are retained on a regular basis.
Hosted Application Pack: An intermediate version of these two models, which 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 corporate 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 leaves the bother 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 mid-size vendors only support the On-Demand model, including Salesforce.com, NetSuite, and SalesNet. While all their talk (especially from Salesforce.com) of the ‘No Software’ model can sound attractive, you will want to balance that against costs of 65 to 130 USD per user per month, and 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—no doubt that is why this range of choices exists!
SugarCRM, for its part, offers Sugar Pro in all three deployment options: 239 USD per user per year to license the software as an application pack, US 39 USD per user per month as an On‑Demand service, and a variety of server appliances (Sugar Cubes) at different prices. Sugar Enterprise is also available, at a price of 449 USD per user per year to license the software as an application pack, US 75 USD per user per month as an On‑Demand service, and on server appliances of various capacities.
If you are skimming this book thinking that CRM customization is an advanced topic and not applicable to you, stop right now and listen to some advice for a moment. Customization is a fact of life, and indeed a generally positive one, for most business applications. The negative aspect of it is that is can sometimes be long and involved, and frequently can be quite expensive. The positive side is that it takes an off-the-shelf shrink-wrapped software application, and adapts it to the way your business actually works.
CRM systems are known to need customization more frequently than other business applications. After all, the average Sales, Purchase, and General Ledger accounting system works pretty much the same way for any business—just set up your structure of initial account codes, and away you go. CRM systems are different!
CRM customizations fall into several classes:
Minor cosmetics: Changing color schemes, adding company logo.
Minor user interface changes: Suppressing certain features from being seen by certain or perhaps all users, rearranging screen layouts, adding and deleting fields from screens, changing field names, and editing the set of options presented on drop-down boxes.
Major application changes: Adding whole new modules to the application, or making major changes to the business logic and function of existing modules.
Application integration: Linking the CRM application with other business applications and processes, to more thoroughly automate and integrate your business operations.
Most advanced products make it easy to change minor cosmetics of the system. Historically, user interface changes were fairly difficult and expensive to perform, but all that has changed. With the release of the Customforce tool by Salesforce.com for customizing the user interface of its CRM, the bar was raised to a significant degree in this key area. Salesforce.com deserves recognition as an innovator in this field of technology, and it has caused nothing short of a revolution in CRM. Today, most important CRM vendors (including SugarCRM) offer this extremely important and useful capability.
Major application changes will always require a software consulting and development firm to perform them, unless you happen to have those resources in house. These changes involve tailoring a CRM to manage aspects of a business that are not uniform across the gamut of small businesses.
More recently, Salesforce.com has been at it again, and has introduced the Sforce API, which offers a well-documented and open programming interface to link other business applications to the Salesforce.com programs and data hosted by Salesforce.com for your business. This is creating a similar disruption in the CRM industry, and several firms are responding in kind. SugarCRM, for one, has its own (more limited) SOAP-based web service interface (using the Nusoap PHP library), which supports such handy capabilities as filing leads captured by forms on your public website into your SugarCRM lead database.