CRMs – What Can They Do for an SME?


Columnist Dr John Yardley, Founder and MD of Threads Software, shares his advice on how SMEs can get the most from a customer relationship management system.

Read all of John’s articles here.


The three letter acronym “CRM” seems to have entered the business world with a vengeance, but what does it mean and do you need it? Well CRM stands for Customer Relationship Management and CRM systems provide computer tools for exactly that – managing customers. Except that it isn’t just customers, but any third-party –  that includes suppliers, service providers, government, local authorities and staff.  The CRM requirement spans all types of business and as such, we call it a horizontal application. Just like a word-processor or spreadsheet, you don’t have to be in any particular type of business to benefit from a CRM system. This contrasts with applications targeted at specific vertical markets, such as law, retail, medicine, etc. That is the theory, but in fact it’s not quite that straightforward.

But exactly what is a CRM system?  The core of any CRM, the “C” bit,  is really just an address book – a digital list of every third party you deal with.

The  “R” or relationship bit, is simple. It is the relationship that the organisation using the CRM has with the third party.  All you need in an address book is a field to tell what sort of relationship your company has with the third party. Not exactly rocket science.

However, it’s when you get to the “M” bit, that things get complicated. CRM systems need to take account of the actual business you are in, how you charge, how you sell, how you buy –  in fact a whole range  of industry-specific features.  

One common requirement for “relationship management” is tracking the sales process from an initial call to action (such as a mailshot, advertisement, event, or web search) through first enquiry, qualification of lead right up to the final sale. Thereafter, once the prospect has become a customer, the CRM system can be used to track post-sales support. This process is extremely helpful in any firm with several employees. Not only can any staff member immediately discover the status of a particular deal, but also, the historic records can be analysed to establish the most efficient marketing tools and staff.

In reality, unless a CRM system is developed for a specific vertical market, then it is unlikely to meet the needs of any organisation. A legal practice, for example, will not handle its third parties in the same way as, say, a pharmaceutical wholesaler might.

Off-the-Shelf or Customise? 

Developers of CRM systems  have tried to  overcome the varying requirements of different markets by making their systems able to be customised.  By this we mean allowing the customer to change the core product to meet some of its specific needs. However, in so doing they can drastically reduce the usefulness of the system to the market. Customisation is complex, requires training and, unless you have in-house expertise, also requires consultancy.  Rather than save money by buying an off-the-shelf system,  CRM users often spend more  in paying for expensive customisation. In many cases, organisations can spend more on customisation than they may have spent on choosing bespoke solution from the start. Furthermore, customised systems still come with a great deal of baggage. They may still contain many features that are not wanted, and these just serve to confuse the user.

Most users of word processing get by on a minority of features. Just ask any Word user how many macros they have written lately? It’s exactly the same with CRMs. What the majority of CRM users want is simply an address book.  It would be wonderful if CRM systems were clever enough to identify  where the next order will come from, but they never can.  And even if they could, most users wouldn’t trust their decision.

Automation is the Key

Automation is what  most users really want. If they discover that a key contact they deal with has changed company, they simply may not have the time or motivation to change the contact details. They may be so preoccupied in dealing with what is immediately in front of them, that they forget  to update the CRM system.  Hence their colleagues are unaware of this important change. However, if the change can be recorded automatically in the CRM system, then everyone is happy. And, in fact, it can. 

Today, most business communication is digital – whether by email, digitised phone calls or documents – and with the right intelligence built-in, all this can be extracted automatically or with very little input from the user. In fact, in addition to names and addresses, communications are the only things you really need to store in a generic CRM system. Everything you might ever need can be extracted from those communications. Software is already available that works in conjunction with existing CRM systems to allow the automatic saving of emails, phone calls and other messages.  Phone calls can also be transcribed and searched,  just  as with textual messages.

And  “requiring little input from the user ” is a key feature essential for user adoption.  No CRM will provide return on investment if it doesn’t get used effectively –  or at all. While ease of use is important, so too is trust.  Your employees won’t use a system if they don’t trust it. Trust is gained when the automated processes – such as changing contact details as a result of a phone call – happen quickly and reliably.  Even more important, employees don’t want to see their private information seeping into the CRM system.

Data Transparency is Vital

Finally, the success of any CRM system depends on transparency  of data. Communications have evolved over the last 20 years from shared paper-based systems in physical filing cabinets to private email accounts somewhere in “the Cloud”.  But  although this has meant massive gains from digitisation, these gains have been lost through unnecessary privacy. Once, authorised staff could easily find a purchase order or contract in a filing cabinet knowing it was unlikely that multiple, and perhaps amended copies, existed elsewhere.

Today, in contrast, the information sender decides who should see a  document by addressing it to specific individuals – most of whom are too busy to decide who else should see it. And if they do share it, then that generates identical copies, all with the potential to be amended, or even leaked to those not meant to see it. It is actually quite bizarre that the customer should be making this decision. In many businesses, as much as 90% of non-confidential communications are kept private unnecessarily. As a result, the majority of those that are authorised and who could benefit from the information, simply aren’t aware of it. .

While over the last few years, there have been some massive strides in IT, these have often resulted in working practices that completely nullify the benefits. As an example, our new digital culture means that many more staff can now work remotely. But in so doing, they may miss out on vital contact with other staff where much very useful information is exchanged.

CRM systems can go a long way to compensating for this but it is important that they get user buy-in.  And the way to do that is by making them easy to use and eliminating unnecessary features, but, crucially, also by not hiding non-confidential information.  Automation together with transparency is key.

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