CRM Acceptance On The Rise

By Geoffrey James

A recent survey of 500 marketing and sales executives by the Yankee Group, a market research firm headquartered in Boston, MA, revealed that 57% of CRM-using executives view the technology positively.

The survey inquired about the executives’ business process challenges and use of technology in their workplaces. Respondents identified three top challenges they had hoped to address: increasing effectiveness (49%), improving close rate (43%), and decreasing sales administration costs (35%). The survey then measured the impact of different technologies and business process issues on a variety of key performance indicators relating to those top challenges.

The study focused on two key CRM technologies. The first was Sales Force Automation (SFA), which provides such functions as contact management, note and information sharing, quick proposal and presentation generation, product configuration tools, calendars and to-do lists. The second was Sales and Marketing Portals (SMPs), which are Web supersites that provide a variety of online services customized for sales and marketing, such as Web searching, news, white and yellow pages directories, email, discussion groups and links to other sites.

The research indicated that SFA was particularly successful in reducing administration time, while SMPs were most successful at increasing revenue per salesperson and improving win rate. The survey also revealed that many companies’ investments in sales technologies have reduced costs only slightly and have done little overall to increase sales effectiveness.

The survey identified two primary reasons why CRM hasn’t realized its full potential. First, many companies believe that implementing an SFA system will automatically solve the challenges facing sales and marketing departments, while in reality these systems are only designed to optimize the pre- and post-sales business process. Second, companies sometimes purchase an SFA system without understanding their business problems and companies’ sales and marketing processes, and the tools intended to make them more efficient and productive.