Archives For CRM Success

When it comes to buying a new automobile, smart shoppers do more analysis than simply looking at the sticker on the windshield. While some cars may seem like a deal at the time of purchase, factors like maintenance and repair costs, resale value, insurance rates, and even fuel costs determine the true value of the vehicle.

Selecting a new CRM system requires at least the same level of analysis.

Today, a majority of enterprise software is delivered as SaaS (software-as-a-service) and sold via some form of a subscription model, meaning users pay an annual fee to access the software (like leasing a vehicle). However, when it comes to customer relationship management (CRM) initiatives, the “sticker price” subscription fees can be misleading. Many vendors charge one price to get customers locked in behind the wheel, but customers soon find they are forced to pay more to fully realize the value of the CRM software.

These additional fees can include costs associated with accessing the CRM via a mobile device, making customizations to the platform, and integrating with other technology partners and systems inside and outside the organization.  If you’re not fully aware of these upcharges, you could be in for an unpleasant surprise.

An Example of Spiraling CRM Costs

We took a look at the largest CRM SaaS vendor in North America – Salesforce.com.

Salesforce customers often pay significantly more than the quoted monthly subscription fee due to hidden fees and other limitations that can increase the total cost of ownership.

Salesforce pricing includes upcharges for system usage, which is often hard to calculate and budget. Upcharges include API calls, which equate to connections to other data sources. Storage-based fees can balloon when large files like PDFs or PPT slide decks are kept within the system. In addition, complete mobile access for some versions can cost as much as $50 additional per user, per month.

Also, building custom mobile applications on the Salesforce platform can cost up to an additional $300 per application per month. Base subscription fees also do not include access and consumption fees for Salesforce’s Data.com offering.

These upcharges can more than double total system costs. Let’s look more closely at the upcharge for API calls. When connecting to external data sources, such as accounting or social media streams, Salesforce sets a limit on the number of times users can send and receive information between systems. Each time a user checks the accounting records of a customer, or augments the prospect information with Dun & Bradsteet data, for example, the system underneath executes an application programming interface (API) call. If Salesforce users go over the maximum allowed number of calls, they are forced to either add more user licenses, or upgrade ALL users to its most expensive Performance edition.

What About SugarCRM?

Sugar is offered under a subscription model similar to Salesforce, but with some important differences. SugarCRM’s PurePrice pricing model means the subscription fee is inclusive of maintenance, and includes mobile access, a Microsoft Outlook Plug-in, reporting, customization and integration capabilities.

SugarCRM aims to limit the “hidden fees” that some CRM providers do not include in their base license costs. SugarCRM is the only CRM solution that offers functionality for marketing, sales and support for one low price. Organizations can customize and build on the Sugar platform without hidden fees or forced upgrades to more costly editions. Additionally, users can make any number of integrations without additional charges or fees.

Finally, Sugar can be deployed either as an on-demand or SaaS deployment, or on the user’s own servers. In addition, Sugar can also be deployed on a number of public clouds, including Amazon EC2, Windows Azure, Rackspace and IBM GTS cloud. Sugar partners also deploy customer instances in their private clouds. In contrast with other CRM vendors who offer a choice in deployment, Sugar is priced the same, regardless of deployment option.

This short analysis provides some basic insight into the costs of buying and maintaining a CRM system. Several pricing and deployment models exist—and it is important to understand which model best addresses the pressing business issues. Before making any decision, be sure to plot out the value to be generated from the deployment, including, but not limited to, the hard dollar costs.

By understanding up-front what additional costs or fees may be incurred, organizations can make an educated, and more cost-effective choice when choosing a CRM provider.

A popular argument for deploying SaaS software is that it “just works.” It is simple for users to get started and use everyday without burdening the IT department. This argument has merit. The cloud has put the power in the hands of the user and minimized the need for IT to troubleshoot software issues. Instead, users can simply open up a browser and be productive.

However, that doesn’t mean technical concerns have been eliminated, they are simply hidden below the surface. SaaS customers need to understand the technical details of service they are using, especially when it comes to mission critical business applications like a CRM.

There are three major areas that can affect your business – maintenance, software upgrades and outages:

  • When is routine maintenance scheduled and how long will the system be down during that period?
  • How frequently are software upgrades made?
  • How will the upgrades affect how the application looks, and relatedly, how much of learning curve will there be to understand product updates?

Think about the consumer services like Facebook and Twitter that you are used to using everyday. There is an adjustment period when even a minor tweak to the service changes “the look and feel.”

Now, imagine coming into work on a Monday morning – and the tools you use to do your job are suddenly barely recognizable due to a major product upgrade? How would that affect your productivity for the short term? Or, imagine as a manager of dozens of sales reps, you get the message that you need to immediately begin training on a new CRM because the old system is “going away.” What if this happens near the end of the quarter?

The IT department is responsible for maintenance and upgrades for software they deploy, and are usually responsible to plan for changes. But regular employees, and entire companies can be negatively impacted by changes both expected and unexpected.

When you rely on software applications to run critical parts of your business, any downtime is costly. The inability to access data, reach and respond to customers, or close deals equates to lost revenue or other hard costs. Research firm Gartner estimates that an hour of downtime for a critical system costs a company $42,000 on average.

And, if you are leaning toward the argument, “an outage is so rare, it won’t happen to me.” SaaS services delivered via the cloud are susceptible to outages. Just last month, an Amazon Web Services data center went down, taking access to Netflix, Reddit and Nest with it.

Now, think about what happens if your sales automation or customer support system goes down. You can probably tolerate a few minutes of downtime, but if it last hours or even a full day, it will dramatically affect the bottom line.

If you unexpectedly, or even with some warning, lose access to your systems – rebuilding that same system with another software product takes time and lots of energy. Costs include:

  •      Purchase of replacement software
  •      Staff or consultants to replicate customizations in the new system
  •      Staff learning curve and training costs
  •      Potential legal costs for re-acquiring data

All of these costs are significant. They can hinder operations at the largest of organizations, and could be catastrophic for smaller businesses. Thus, it is of utmost importance to ensure you have access to your data and system in light of any type of disaster or unforeseen “outage” of your SaaS applications.

By choosing a SaaS vendor with multiple deployment options, open software so the data can “live on”, and a solid business continuity plan – you can deploy cloud and SaaS apps with the highest level of confidence.

In a world that’s increasingly regulated, a well-designed and tightly-integrated CRM is imperative to an organization’s compliance efforts. In the United States, regulated industries with strict mandates like financial services, healthcare, and insurance are often finding that “out of the box” cloud-based CRM systems don’t comply with regulatory requirements.

For example, financial services companies simply cannot tolerate unplanned or provider-planned downtime. Healthcare organizations must adhere to strict HIPAA compliance requirements regarding patient data.

On top of regulatory compliance, outside the United States, many countries have significantly more strict rules around the gathering and storage of customer data. After the Edward Snowden revelations, cloud-based SaaS CRM apps can also bring about regulatory compliance challenges. Some countries now prohibit hosting data on U.S. servers, or require that data is stored within national boundaries. In many cases, the most desirable solution for multinational corporations or companies in highly regulated industries is to deploy servers on-premise. It’s the best way to maintain security and control, and to ensure regulatory compliance. 

If companies in these regions and industries fail to comply with these mandates the penalties can be burdensome, or even disastrous. Being out of compliance in some regions or industries is an issue of breaking the law, and strict financial penalties for noncompliance can be crippling. The stakes are high. In 2014, USA and European banks paid nearly $65 million in fines for an array of violations.

Many SaaS and cloud providers will skirt the issue of data location and ownership with complex data key encryption. The customer data is actually stored in a data center in another country, but cannot be accessed without an encryption key stored locally. While encrypting data is an important security measure, it does not achieve compliance. Simply put, if the data is not in the region or country where the customers reside – compliance and control issues can still arise.

So, if your business is in a closely regulated industry, you need to know whether the CRM system you are considering supports these legal requirements. Additionally, if your business operates globally, or in countries with strict data laws, it is important to ask the right questions before choosing a CRM provider. So what are those questions? We’ve compiled a list. Be sure to get answers to these questions – in writing:

  •      Can you decide where data is stored?
  •      How can you be sure your data is being stored in your region? In your country?
  •      Does the vendor offer on-premise deployment or are they cloud only?
  •      How often can you export your data?
  •      Can data be exported in multiple formats?
  •      Can ALL of the system data be retrieved at any time? Or can you export only the database?
  •      What about unstructured data such as activity streams, call records and other system metadata?
  •      Is the data always “yours” and not owned by the vendor?
  •      How does the vendor guarantee access to your data in the event of or business discontinuity?

If the potential vendor cannot answer these questions (and more important “put it in writing” as part of their SLA) you may want to re-think your choice.

At SugarCRM we have customers in more than 120 countries. We realize companies around the world are subject to many different laws and regulations. Legal requirements in one country or industry may be inconsistent with legal requirements applicable elsewhere. Hence, we offer a multi-tenant cloud service, a private instance in the cloud, and also allow customers to deploy on-premise on their own servers. This gives customers a level of control they can’t achieve in a proprietary SaaS-only model where their data is locked up in one vendor’s data silo. A flexible deployment approach allows our customers to more easily comply with international data security and privacy laws.

Our i2i workshop series follows SugarCRM’s recent announcement about a “reimagined” vision of CRM, one that fuses Customer Journey Mapping with CRM.

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Last week, we highlighted three fast, simple integrations that can turn your sales team into a deal- closing powerhouse. Today, let’s focus on marketing and customer support and discuss how they, too, can amp up performance in the New Year. Here are three more tools designed to help your marketing teams improve customer support and increase both the volume and quality of leads.

Act-On: Boost Your Marketing

It’s no secret that salespeople crave more –more leads and more insight into the leads they already have. Fortunately, Act-On marketing automation software can help on both fronts. Act-On can make it easier for your marketing team to generate quality leads, and it seamlessly embeds into the Sugar UX, providing better visibility into lead history, behavior, etc. This integration with SugarCRM can be a huge advantage when your sales reps first reach out to qualified leads.

Gain more insight into lead flow and lead behavior by integrating Act-On directly into your Sugar instance.

Gain more insight into lead flow and lead behavior by integrating Act-On directly into your Sugar instance.

Callinize: Streamline Support (and Sales) Communications

A CRM system makes customer support professionals more effective. When issues arise, it provides a support agent with the customer’s basic information, purchase history, etc. However, if your CRM and phone system aren’t integrated, your support rep may have to wade through step after step to ID the caller, establish a follow-up plan, etc.

Callinize solves this problem by making it super simple to connect your inbound and outbound calls right into Sugar. With Callinize, your agents will know who is calling, so they can immediately jump to the most relevant records. What’s more, Callinize helps agents populate follow-on tasks –a feature that’s useful to your sales reps, too, because they can use it to create follow-up reminders and tasks after any call.

Quickly and easily integrate your phone system to Sugar with Callinize

Quickly and easily integrate your phone system to Sugar with Callinize

Get Satisfaction: Turn Your Customers into a Community

Companies are always looking for ways to cut the cost of customer support. One way you can do this is to promote a culture of self-service using “customer communities” focused on your products or services.

A customer community is made up of customers (and some employees) who know your products well and can help others by creating content and/or communicating on your behalf to those who have problems. Your customer community can help customers solve basic or common problems, without the need for a costly call to your support center. In addition, your customer community can be used to generate new product ideas or features.

Get Satisfaction is a customer community platform that blends right into Sugar. So, while your customer community grows, the solutions and ideas that are generated within can be quickly turned into knowledge articles in Sugar. They can provide solution suggestions for the customer support teams using the Sugar support modules, as well as populate self-service portal articles.

These are just a few ways to leverage the power of the Sugar ecosystem to improve your marketing performance and boost customer satisfaction. For hundreds (literally!) of more ways to drive value from your Sugar deployment, check out Sugar Exchange.

And remember, it’s never too early (or late) to turbo boost your CRM and make 2015 the best year yet for your business.

Is your CRM strategy and vision aligned with the modern customer? Does your CRM system support the full customer life cycle? Is your organization reaping the benefits of having a modern, forward thinking CRM? Regardless of the answer, there is always room for improvement when it comes to delighting your customers and improving the productivity of all of your customer-facing employees.

On November 5, Forrester Research’s Kate Leggett and myself will be sitting down to discuss what modern organizations need to match their CRM initiatives with today’s more engaged, informed, and connected customer. We will outline some of the core tenets of a “modern CRM” initiative, and cite several successful examples of modern CRM in action.

Join us Wednesday, November 5 and learn:

  • The six critical building blocks of modern CRM
  • How organizations are shifting from systems of transactions into systems of engagement to support the entire customer lifecycle
  • Tips on how any organization can begin modernizing their CRM initiative in the age of the customer

This promises to be an engaging and informative session for any business that is looking at the customer experience in the new the age of the customer. Join Kate and me on Wednesday and we will be happy to address any CRM and customer related questions you might have.

Registration is limited, so click HERE to register today. We hope you can join us!

It’s been a while, but here I am, taking my own CRM journey full circle. I wrote my first blog for SugarCRM five years ago and here I am, at it again. My perspective now is more focused, taking cues from front line experience and watching companies work to make sense of the sea change happening in the business world. As an industry, and as a discipline, we have made significant progress. We are not arguing about definitions and are much more focused as a practice (CRM practice, to be clear).

The historical perspective—the one where users of the system considered CRM only a management vehicle to watch, control, and measure their performance— is not yet eradicated. But dare I say this is no longer the majority viewpoint either. Empowering the individual user will always likely be a work in progress, but since I have hung my hat at the front door of SugarCRM, significant progress has been made.

From the individual contributor to the senior executive team, organizations have come to realize what a well-tuned CRM engine can do for their business, especially if we understand the needs of the user. Driving success is about answering the $64,000 question, “What’s in it for me?” The overall success of any CRM initiative can increase simply by answering that simple question. Know what you are asking your teams to do every hour of every day and ask how can you help them to do it better!

So…“What’s in it for me?”

The Sales Perspective: Ask a sales person what they think about CRM systems and the answer might be less than positive. But, whose issue is this, really? In the realm of carrot and stick, too much stick does not get the job done.

When we discuss the part of CRM that is used to drive sales, track leads and opportunities, as well as manage contacts, we often forget to include the discussion about helping the sales team close the deal. Many might argue that ‘closing the deal’ should be a non-event. If value to the business and the end users is clear, then signing a piece of paper is just one step in the process. Actually, by then, it should be the easy part. What we need to focus on is helping everyone to derive the value from the system that each user wants.

The Management Perspective: In answering the question “what’s in it for me?” we can’t forget management, as they too are individuals that are looking to extract personal value from a CRM initiative. The senior management team within all organizations does have the right to track progress, is that so wrong? The VP of Sales does have the right to understand how his or her sales team is using a system and how often reps connect or interact with customers or prospective customers. Finance has to plan the course of business, cash flow and production, staffing and other important business metrics. The marketing and demand teams need to know if their programs are designed correctly. In short, management is not the enemy.

The Customer Perspective: My lessons from the field during the past few years suggest that the cultural changes happening now are much more complex than the technological changes. Spend time actively listening to your customers and reward your sales teams who spend this time engaging and listening as well. Individual users of the system will very quickly see the benefits of a system that brings context to their discussions, and provides efficient means to share customer information. The conversation between the management team and sales teams should focus on the customer, not system tasks and made up numbers.

So, how can you start answering the “what’s in it for me?” question on a company-wide basis during a CRM implementation? A great start is to engage your teams and include them in the entire CRM deployment process and have a fundamental understanding of what they need. Your goal should be to align your organization around the needs of your customers. If your team, especially those on the front lines, believes you are an ally, in the trenches with them, the question “what’s in it for me?” will rarely ever need to be asked.