CRM is a business strategy that uses technology to collect and analyze customer information, making it available to all departments. It can be complex and expensive, but even small businesses can implement a CRM strategy with simple software or tools like cards and pens.
A central goal of every business is to serve its customers. For as long as there have been traders, success or failure has been based on this simple rule. Customer Relationship Management (CRM) is a way of using technology to do just that.
There are many software available that offers customer relationship management features but in reality CRM goes beyond the implementation of the software. It is a business strategy that often involves the use of multiple software, as well as the implementation of policies that promote (1) the collection of customer information and (2) the use of that information by individuals throughout the company in order to maximize customer service and increase sales.
The customer relationship management system is an enterprise system, which means that it spans multiple departments. Virtually all departments within a company have at least some indirect access to customers or customer information; the goal of CRM is to collect this information in a central repository, analyze it and make it available to all departments. For example, a company’s call center might have a “pop-up screen,” a small application connected to the phone system. This application, which is a type of CRM, automatically detects who is calling and, when the agent answers the phone, produces a screen on the computer listing important information about the caller, such as what they have purchased in the past, what they are likely to purchase in the future and what products the company might have available that would go well with what the customer has already purchased. This “screen pop” consists of different information from different databases; can draw on information from the accounting department to show the agent what his current balance might be; can draw on information from the sales department to show what has been recently purchased and can draw on information from the credit department to show the agent what terms can be offered.
Because a customer relationship management system is so complex, often involving multiple information silos and multiple pieces of software, all connected under a single interface, it is often difficult to set up. Some large companies use an integrator to put the CRM system together. Due to the complexity of CRM, smaller companies often find it too expensive. However, even the smallest business can implement a CRM strategy. While a Fortune 500 company may spend hundreds of thousands of dollars a year on customer relationship management, a small one-man shop can even manage CRM with a box of cards and a ballpoint pen. Mid-sized businesses can use simple, off-the-shelf software like contact managers and spreadsheets, and still have a very effective CRM system that can help them serve customers in the best possible way and make the most of the information that has been gathered.
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