CRM (Costomer Relationship Management)

While the term CRM generally refers to a software-based approach to handling customer relationships, most CRM software vendors stress that a
successful CRM effort requires a holistic approach.[1]

CRM initiatives often fail because implementation was limited to software installation, without providing the context, support and understanding for employees to learn, and take full advantage of the information systems.[2]

CRM can be implemented without major investments in software, but software is often necessary to explore the full benefits of a CRM strategy.
Other problems occur[3]

when failing to think of sales as the output of a process that itself needs to be studied and taken into account when planning automation[4].

1 Overview
2 Types/Variations of CRM
2.1 Operational CRM
2.2 Sales (SFA)
2.3 Analytical CRM
2.4 Sales Intelligence CRM
2.5 Campaign Management
2.6 Collaborative CRM
2.7 Consumer Relationship CRM
3 Strategy
4 Implementation Issues
5 Privacy and data security
6 Market structures
7 Free and Open Source CRM Software
8 See also
9 References
From the outside, customers interacting with a company perceive the business as a single entity, despite often interacting with a number of
employees in different roles and departments. CRM is a combination of policies, processes, and strategies implemented by an organization to unify its customer interactions and provide a means to track customer information. It involves the use of technology in attracting new and profitable customers, while forming tighter bonds with existing ones.


CRM includes many aspects which relate directly to one another:

Front office operations — Direct interaction with customers, e.g. face to face meetings, phone calls, e-mail, online services etc.

Back office operations — Operations that ultimately affect the activities of the front office (e.g., billing, maintenance, planning, marketing,
advertising, finance, manufacturing, etc.)

Business relationships — Interaction with other companies and partners, such as suppliers/vendors and retail outlets/distributors, industry
networks (lobbying groups, trade associations). This external network supports front and back office activities.

Analysis — Key CRM data can be analyzed in order to plan target-marketing campaigns, conceive business strategies, and judge the success
of CRM activities (e.g., market share, number and types of customers, revenue, profitability).

Perhaps it is important to note that while most consumers of CRM view it as a software "solution", there is a growing realization in the corporate world that CRM is really a customer-centric strategy for doing business; supported by software. Along these lines, CRM thought leaders like Dick Lee of High Yield Methods define CRM as "CRM adds value to customers in ways that add value back to the company" [5]


Types/Variations of CRM
There are several different approaches to CRM, with different software packages focusing on different aspects. In general, Customer Service, Campaign Management and Sales Force Automation form the core of the system (with SFA being the most popular[citation needed]).


Operational CRM
Operational CRM provides support to "front office" business processes, e.g. to sales, marketing and service staff. Interactions with customers are
generally stored in customers' contact histories, and staff can retrieve customer information as necessary. The contact history provides staff members with immediate access to important information on the customer (products owned, prior support calls etc.), eliminating the need to individually obtain this information directly from the customer. Reaching to the customer at right time at right place is preferable.
Operational CRM processes customer data for a variety of purposes:
Managing campaigns
Enterprise Marketing
Sales Force
Sales Management


(SFA) Sales Force Automation automates sales force-related activities such as:
Activity Management: Scheduling sales calls or mailings
Tracking responses
Generating reports
Opportunity Management and Assessment
Account Management and Target Account Selling
Automate Sales Order Processing
Analytical CRM


Analytical CRM analyzes customer data for a variety of purposes:
Designing and executing targeted marketing campaigns
Designing and executing campaigns, e.g. customer acquisition, cross-selling, up-selling
Analysing customer behavior in order to make decisions relating to products and services (e.g. pricing, product development)


Management information system (e.g. financial forecasting and customer profitability analysis)
Analytical CRM generally makes heavy use of data mining and other techniques to produce useful results for decision-making
Sales Intelligence CRM

Sales Intelligence CRM is similar to Analytical CRM, but is intended as a more direct sales tool. Features include alerts sent to sales staff regarding:

Cross-selling/Up-selling/Switch-selling opportunities
Customer drift
Sales performance
Customer trends
Customer margins
Customer alignment
Campaign Management


Campaign management combines elements of Operational and Analytical CRM. Campaign management functions include:
Target groups formed from the client base according to selected criteria Sending campaign-related material (e.g. on special offers) to selected recipients using various channels (e.g. e-mail, telephone, SMS, post) Tracking, storing, and analyzing campaign statistics, including tracking responses and analyzing trends Collaborative CRM

Collaborative CRM covers aspects of a company's dealings with customers that are handled by various departments within a company, such as
sales, technical support and marketing. Staff members from different departments can share information collected when interacting with customers. For example, feedback received by customer support agents can provide other staff members with information on the services and features requested by customers. Collaborative CRM's ultimate goal is to use information collected by all departments to improve the quality of services provided by the company.[6]

Consumer Relationship CRM
Consumer Relationship System (CRS) covers aspects of a company's dealing with customers handled by the Consumer Affairs and Customer Relations contact centers within a company.[1] Representatives handle in-bound contact from anonymous consumers and customers. Early warnings can be issued regarding product issues (e.g. item recalls) and current consumer sentiment can be tracked (voice of the customer).


Several CRM software packages are available, and they vary in their approach to CRM. However, as mentioned above, CRM is not just a technology but rather a comprehensive, customer-centric approach to an organization's philosophy of dealing with its customers. This includes policies and processes, front-of-house customer service, employee training, marketing, systems and information management. Hence, it is important that any CRM implementation considerations stretch beyond technology toward the broader organizational requirements.

The objectives of a CRM strategy must consider a company's specific situation and its customers' needs and expectations. Information gained through CRM initiatives can support the development of marketing strategy by developing the organization's knowledge in areas such as identifying customer segments, improving customer retention, improving product offerings (by better understanding customer needs), and by identifying the organization's most profitable customers.[7]

CRM strategies can vary in size, complexity, and scope. Some companies consider a CRM strategy only to focus on the management of a team of
salespeople. However, other CRM strategies can cover customer interaction across the entire organization. Many commercial CRM software packages provide features that serve the sales, marketing, event management, project management, and finance industries. From this perspective, CRM has for some time been seen to play an important role in many sales process engineering efforts[8].


Implementation Issues
Many CRM project "failures" are also related to data quality and availability. Data cleaning is a major issue. If a company's CRM strategy is to track life-cycle revenues, costs, margins, and interactions between individual customers, this must be reflected in all business processes. Data must be extracted from multiple sources (e.g., departmental/divisional databases such as sales, manufacturing, supply chain, logistics, finance, service etc.), which requires an integrated, comprehensive system in place with well-defined structures and high data quality. Data from other systems can be transferred to CRM systems using appropriate interfaces.


Because of the company-wide size and scope of many CRM implementations, significant pre-planning is essential for smooth roll-out. This
pre-planning involves a technical evaluation of the data available and the technology employed in existing systems. This evaluation is critical to
determine the level of effort needed to integrate this data.


Equally critical is the human aspect of the implementation. A successful implementation requires an understanding of the expectations and
needs of the stakeholders involved. An executive sponsor should also be obtained to provide high-level management representation of the CRM project.


An effective tool for identifying technical and human factors before beginning a CRM project is a pre-implementation checklist.[9] A checklist
can help ensure any potential problems are identified early in the process.


Privacy and data security
One of the primary functions of CRM software is to collect information about customers. When gathering data as part of a CRM solution, a company must consider the desire for customer privacy and data security, as well as the legislative and cultural norms. Some customers prefer assurances that their data will not be shared with third parties without their prior consent and that safeguards are in place to prevent illegal access by third


Market structures
The following table lists the top CRM software vendors in 2006-2007 (figures in millions of US dollars) published in a Gartner study.[10]
Vendor 2007
Revenue 2007
Share (%) 2006
Revenue 2006
Share (%) '06-'07
Growth (%)
SAP 2,050.8 25.Mar 1,681.7 26.Haz 22.0
Oracle 1,319.8 15.Mar 1,016.8 15.May 29.Ağu 676.5 08.Mar 451.7 06.Eyl 49.8
Amdocs 421.0 05.Şub 365.9 05.Haz 15.Oca
Microsoft 332.1 04.Oca 176.1 02.Tem 88.6
Others 3,289.1 40.6 2,881.6 43.7 14.Oca
Total 8,089.3 100 6,573.8 100 23.Oca
The following table lists the top software vendors for CRM projects completed in 2006 using external consultants and system integrators, according to a 2007 Gartner study.[11]
Vendor Percentage of implementations
Siebel (Oracle) 41%
SAP 8%
Epiphany (Infor) 3%
Oracle 3%
PeopleSoft (Oracle) 2% 2%
Amdocs 1%
Chordiant 1%
Microsoft 1%
SAS 1%
Others 15%
None 22%

A 2007 Datamonitor report [12] lists Oracle (including Siebel) and SAP as the top CRM vendors, with Chordiant, Infor, and as significant, smaller vendors.

Free and Open Source CRM Software

As the enterprise CRM market grows, many companies and small groups of developers are focusing on creating CRM software that is distributed freely on the Internet or offered at a fraction of the price of classic enterprise CRM software. However, many vendors charge for support.
The software typically offers similar features to popular enterprise software packages.


Some of the more popular include:
EBI Neutrino R1 CRM java
OpenERP - python
Compiere - java
Adempiere - java
Openbravo - java
Ofbiz - java
xTuple - integrated ERP, C++
Vtiger_CRM - php
SugarCRM - php
GetSalesDone - php, hosted
CiviCRM - php
Opentaps - java
XLsuite - ruby (RubyOnRails) - full stack CRM and ERP system
eWay CRM - .NET (For single user only)
Web Based CRM - .NET (For single user only)


See also
Sales intelligence
Consumer Relationship
Customer Experience
Customer service
Data mining
Database marketing
Enterprise Feedback Management (EFM)
Enterprise relationship management (ERM)
Mystery shopping
Predictive analytics
Sales force management system
Sales process engineering
Web management system


1. ^ Malthouse, Edward
C; Bobby J Calder (2005). "Relationship Branding and CRM". in Alice Tybout and Tim Calkins. Kellogg on Branding. Wiley. pp. 150–168.
2. ^ Rigby, Darrell K.; Frederick F. Reichheld, Phil Schefter (2002). "Avoid the four perils of CRM". Harvard Business Review 80 (2): 101–109. doi:10.1225/8946.
3. ^ Paul H. Selden (April/May 1996). "SFA Myths Abound". Sales and Marketing Strategies & News 6 (3): 51 and 53.
4. ^ Paul H. Selden (November 2000). "The Power of Quality Thinking In Sales and Management". Quality Progress: 58-64.
5. ^ Interview with Dick Lee at Effective CRM
6. ^ Edwards, John (2007-11-29). "Get It Together with Collaborative CRM". insideCRM. Tippit. Retrieved on 2008-02-01.
7. ^ Bligh, Philip; Douglas Turk (2004). CRM unplugged – releasing CRM's strategic value. Hoboken: John Wiley & Sons. ISBN 0-471-48304-4.
8. ^ Paul H. Selden (1997). Sales Process Engineering: A Personal Workshop. Milwaukee, WI: ASQ Quality Press. p. 23.
9. ^ Dyche, 2002, Managing Your CRM Project
10. ^ Gartner, Inc (2008-09-12). Gartner Says Worldwide Customer Relationship Management Market Grew 23 Percent in 2007. Press release. Retrieved on 2008-08-15.
11. ^ Gartner, Inc. (22 June 2007) Commonly Deployed CRM Application Vendors in 2006
12. ^ Datamonitor (22 August 2007). Datamonitor suggests Oracle, SAP likely to remain atop CRM market