What is a CRM system really used for ?


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What is a CRM systemTechnology can be both a crippling or liberating investment for any business big or small.

When faced with the possibilities that technology like CRM systems can bring to a business its easy to lose sight of the reason that these investments are actually being made and that’s why you need to go back the beginning and ask what is a CRM system really used for.

CRM or customer relationship management is a software application that can either be run on premises (at your business) or more typically these days offsite in the cloud (internet) from a software as a service (SaaS) CRM provider.

It’s key purpose is to allow for the effective management of relationships between customer and supplier, but what does that actually mean.

Relationships form when there’s an affinity between a group of people. They occur for various reasons such as shared values, complimentary skills, likeable personality traits and all sorts of other human characteristics as well as business reasons.

Your CRM System Should Help You Build Relationships

Businesses are complex things made up of different individuals, products and services, most of which may mean very little to most customers. Despite the huge array of choice that many businesses offer these days there are probably just a few things that each customers sees as being valuable to them.

So the the first key to building relationships with prospects and customers is to understand what is really important to them, so your CRM system should help you do that by allowing you to attribute each contact and company with information that can segment (characterise) your contacts into groups with shared values and interests.

You’re not just building relationships externally, you’re also doing it internally so your CRM system should be easy for your staff to use and allow them to understand the prospects and customers their engaging with and make informed decision about what they need to do through identification of opportunities as well as problems.

Your CRM System Should Help You Understand Your Sales Engagement

As well as understanding your prospects and customers and allowing you to tune your communications so that they’re better aligned, eventually your going to end up in a sales engagement.

Your CRM system should also help you understand how your progressing with each opportunity and identify potential deals that have slowed, so that you can engage the appropriate nurturing, or adjust a deals probability.

To do this you must be able to clearly the define the steps involved in progressing a sales opportunity towards a conclusion for your business. Restricting yourself to the steps included in a CRM system will lead to some friction and a misunderstanding of how deals or actually progressing.

Whilst the progression of deals is a good indication, the time it takes a deal to move between stages and the time that deals languish at a particular stage can also help you to determine opportunities that or slowing or stalled or have a lower probability of concluding.

So what is a CRM system ?

A piece of technology (software) that help businesses build relationships with prospects and customers and better understand how live deals are progressing. If its not helping you do that, then its probably a liability.

You may also find this guide useful from Hitachi Consulting to help you define what is a CRM system really for and how it will be used and implemented within your business.

Republished with author's permission from original post.


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