Companies fail to reap full benefits from CRM software
Press Release from The National Computing Centre, Manchester UK.
Issued 20th July 2009
Companies are still failing to gain all the anticipated benefits from their customer relationship management systems (CRM), according to a new NCC Research study commissioned by the Evaluation Centre (www.evaluationcentre.com) an interactive online service guiding IT buyers in the selection and use of business software, services and technology.
Half the organisations surveyed have either been only partially successful in realising the original benefits sought (45%) or have seen no major benefits from implementing their CRM systems (5%). Not one organisation felt they had been completely successful, although 50% had seen some real benefits from their CRM system.
Failure to deliver all the anticipated benefits is exacerbated by the fact that only 48% of respondents have an overall customer management strategy irrespective of any technology systems deployed. This lack of direction comes even though most of the companies (62%) regard having an effective customer management strategy as much more important now than three years ago.
The budget for CRM activities appears to be holding up well in the recession with 18% of organisations expecting to spend more than last year and 50% keeping expenditure at the same level. Only 12% expect to see a cut in spending. Also, half the organisations interviewed (50%) are currently making changes or additions to their CRM implementation with a further 30% planning to do so in the future.
Steve Fox, Evaluation Centre Managing Director, commented: "It is reassuring to see that organisations are maintaining their investment in CRM software to better understand their customers and improve their service levels."
Respondents were asked to rate their key reasons for installing integrated CRM software, using a scale of 1 to 5 where 1 stands for 'not important' and 5 for 'very important'.
The aggregated results show that customer satisfaction (4.3), improving the customer lifetime value (4.2) and the retention of existing customers (4.1) were the major drivers. This is followed by providing better customer information to functional areas of the business, such as sales & marketing (3.9), allowing a company to introduce more effective and targeted marketing campaigns and enhancing cross and up-sell opportunities (3.8).
Companies have had to invest significantly to customise their CRM system to meet all their needs. In 10% of cases this has required 'very significant' changes while 35% have needed 'significant' modification.
Once the software is installed there will always be a need for modifications to reflect changing business requirements. Only 10% of companies have found this 'very easy' to do with a further 25% seeing it as 'easy. Conversely, 5% have found it 'very difficult, 25% 'difficult and 15% 'moderately difficult'.
The alternative to maintaining your own CRM system is to use a hosted solution, the benefits being that you avoid upfront investment in hardware and software, as well as ongoing support and maintenance charges, in return for paying a fixed price per user per month. But only 10% of companies have adopted this approach while a further 26% might consider moving in this direction; however, 43% would not entertain this option.
We spoke to a broad cross-section of over 100 organisations for this year's survey into CRM applications and trends. The public sector accounted for 20% of the sample, as both local government and national agencies have made significant IT investments in this area as they are urged to develop closer links with their customers.
Of the remainder, 20% are drawn from business services, 13% from IT & telecoms industry, 10% from banking & finance, 10% from retail and 10% from manufacturing.
Companies vary in size with 6% having in excess of £5 billion turnover, 10% in the £1 billion to £5 billion bracket and 15% in the £250 million to £1 billion range. In the mid-market 13% have between £100 million and £250 million turnover and 21% £50 million to £100 million. At the smaller end 12% have a turnover of between £10 million and £50 million and 18% £5 million to £10 million. Not-for-profit organisations account for 5% of the sample.
The survey is available from www.evaluationcentre.co.uk
See the "Top Business Issues" section.
NOTE TO EDITORS
About The National Computing Centre (NCC)
The National Computing Centre (NCC) helps IT decision makers deliver effective solutions to business problems by bringing together users, experts and vendors to share experiences and develop best practices. We are a non-profit distributing organisation.
About the Evaluation Centre
The Evaluation Centre (www.evaluationcentre.com) is an interactive service for end users and consultants to assist them in the procurement process for software, services and technology and part of the portfolio of services delivered by NCC.
For more information please contact Steve Fox on +44 (0)870 908 8767 or email email@example.com or Cliff Mills on +44 (0)870 908 8767 or email firstname.lastname@example.org.
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