History of CRM

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The History of CRM -- Moving Beyond the Customer Database

Customer Relationship Management (CRM) is one of those magnificent concepts that swept the business world in the 1990’s with the promise of forever changing the way businesses small and large interacted with their customer bases. In the short term, however, it proved to be an unwieldy process that was better in theory than in practice for a variety of reasons.

First among these was that it was simply so difficult and expensive to track and keep the high volume of records needed accurately and constantly update them.

In the last several years, however, newer software systems and advanced tracking features have vastly improved CRM capabilities and the real promise of CRM is becoming a reality. As the price of newer, more customizable Internet solutions have hit the marketplace; competition has driven the prices down so that even relatively small businesses are reaping the benefits of some custom CRM programs.

In the beginning…

The 1980’s saw the emergence of database marketing, which was simply a catch phrase to define the practice of setting up customer service groups to speak individually to all of a company’s customers.
In the case of larger, key clients it was a valuable tool for keeping the lines of communication open and tailoring service to the clients needs. In the case of smaller clients, however, it tended to provide repetitive, survey-like information that cluttered databases and didn’t provide much insight. As companies began tracking database information, they realized that the bare bones were all that was needed in most cases: what they buy regularly, what they spend, what they do.

Advances in the 1990’s

In the 1990’s companies began to improve on Customer Relationship Management by making it more of a two-way street. Instead of simply gathering data for their own use, they began giving back to their customers not only in terms of the obvious goal of improved customer service, but in incentives, gifts and other perks for customer loyalty.
This was the beginning of the now familiar frequent flyer programs, bonus points on credit cards and a host of other resources that are based on CRM tracking of customer activity and spending patterns. CRM was now being used as a way to increase sales passively as well as through active improvement of customer service.

True CRM comes of age

Real Customer Relationship Management as it’s thought of today really began in earnest in the early years of this century. As software companies began releasing newer, more advanced solutions that were customizable across industries, it became feasible to really use the information in a dynamic way.
Instead of feeding information into a static database for future reference, CRM became a way to continuously update understanding of customer needs and behavior. Branching of information, sub-folders, and custom tailored features enabled companies to break down information into smaller subsets so that they could evaluate not only concrete statistics, but information on the motivation and reactions of customers.

The Internet provided a huge boon to the development of these huge databases by enabling offsite information storage. Where before companies had difficulty supporting the enormous amounts of information, the Internet provided new possibilities and CRM took off as providers began moving toward
Internet solutions.

With the increased fluidity of these programs came a less rigid relationship between sales, customer service and marketing. CRM enabled the development of new strategies for more cooperative work between these different divisions through shared information and understanding, leading to increased customer satisfaction from order to end product.

Today, CRM is still utilized most frequently by companies that rely heavily on two distinct features: customer service or technology. The three sectors of business that rely most heavily on CRM -- and use it to great advantage -- are financial services, a variety of high tech corporations and the telecommunications industry.

The financial services industry in particular tracks the level of client satisfaction and what customers are looking for in terms of changes and personalized features. They also track changes in investment habits and spending patterns as the economy shifts. Software specific to the industry can give financial service providers truly impressive feedback in these areas.

Who’s in the CRM game?
About 50% of the CRM market is currently divided between five major players in the industry: PeopleSoft, Oracle, SAP, Siebel and relative newcomer Telemation, based on Linux and developed by an old standard, Database Solutions, Inc.

The other half of the market falls to a variety of other players, although Microsoft’s new emergence in the CRM market may cause a shift soon. Whether Microsoft can capture a share of the market remains to be seen. However, their brand-name familiarity may give them an edge with small businesses considering a first-time CRM package.

PeopleSoft was founded in the mid-1980’s by Ken Morris and Dave Duffield as a client-server based human resources application. In 1998, PeopleSoft had evolved into a purely Internet based system, PeopleSoft 8. There’s no client software to maintain and it supports over 150 applications. PeopleSoft 8 is the brainchild of over 2,000 dedicated developers and $500 million in research and development.
PeopleSoft branched out from their original human resources platform in the 1990’s and now supports everything from customer service to supply chain management. Its user-friendly system required minimal training is relatively inexpensive to deploy. .
One of PeopleSoft’s major contributions to CRM was their detailed analytic program that identifies and ranks the importance of customers based on numerous criteria, including amount of purchase, cost of supplying them, and frequency of service.
Oracle built a solid base of high-end customers in the late 1980’s, then burst into national attention around 1990 when, under Tom Siebel, the company aggressively marketed a small-to-medium business CRM solution. Unfortunately they couldn’t follow up themselves on the incredible sales they garnered and ran into a few years of real problems.
Oracle landed on its feet after a restructuring and their own refocusing on customer needs and by the mid-1990’s the company was once again a leader in CRM technologies. They continue to be one of the leaders in the enterprise marketplace with the Oracle Customer Data Management System.
Telemation’s CRM solution is flexible and user-friendly, with a toolkit that makes changing features and settings relatively easy. The system also provides a quick learning environment that newcomers will appreciate. Its uniqueness lies in that, although compatible with Windows, it was developed as a Linux program. Will Linux be the wave of the future? We don’t know, but if it is, Telemation’s ahead of the game.
The last few years…
In 2002, Oracle released their Global CRM in 90 Days package that promised quick implementation of CRM throughout company offices. Offered with the package was a set fee service for set-up and training for core business needs. .
Also in 2002 (a stellar year for CRM), SAP America’s mySAP began using a “middleware” hub that was capable of connecting SAP systems to externals and front and back office systems for a unified operation that links partners, employees, process and technologies in a closed-loop function.
Siebel consistently based its business primarily on enterprise size businesses willing to invest millions in CRM systems, which worked for them to the tune of $2.1 billion in 2001. However, in 2002 and 2003 revenues slipped as several smaller CRM firms joined the fray as ASP’s (Application Service Providers). These companies, including UpShot, NetSuite and SalesNet, offered businesses CRM-style tracking and data management without the high cost of traditional CRM start-up.
In October of 2003, Siebel launched CRM OnDemand in collaboration with IBM. Their entry into the hosted, monthly CRM solution niche hit the marketplace with gale force. To some of the monthly ASP’s it was a call to arms, to others it was a sign of Siebel’s increasing confusion over brand identity and increasing loss of market share. In a stroke of genius, Siebel acquired UpShot a few months later to get them started and smooth their transition into the ASP market. It was a successful move.
With Microsoft now in the game, it’s too soon to tell what the results will be, but it seems likely that they may get some share of small businesses that tend to buy based on familiarity and usability. ASP’s will continue to grow in popularity as well, especially with mid-sized businesses, so companies like NetSuite, SalesNet and Siebel’s OnDemand will thrive. CRM on the web has come of age!


A Real CRM Strategy or Just Tracking Customers?


Exactly what is CRM
The idea itself is nothing new; its roots have been around since trading began. The principle of looking after your customers so that they come back regularly is, after all, merely the basis of good trading. In an increasingly competitive commercial world however, strong customer relationships take on an increasing importance. With the cost of selling to a new customer being five times the cost of selling to an existing one you can’t afford to lose established business.
Yes, you still want new markets, and yes, for various reasons customers will still disappear. The important thing is to minimise this loss and make sure the reasons behind it don’t stem from something you are doing – or more significantly something you are not doing.

Which is why good Customer Relationship Management is vital – and why the process has now been refined to make it more effective than ever.

What does CRM Involve?

In essence, making your customer feel special by understanding his needs and fulfilling those needs in a personal manner which will keep him coming back for more.

Going that extra mile and providing service beyond that which was expected takes your customer to the next stage, where he becomes a ‘raving fan’ of your business - and you can’t have too many of those. Achieve this and your customer suddenly becomes part of your sales force, telling everyone he meets how good you are.

This can actually be achieved without computers and software. A good memory and a card index can keep track of customer’s preferences and buying patterns. Newsletter campaigns, post sale follow-ups and special offer mailings can all be organised - given time; except that this is where it so often falls apart. For most companies time is the commodity in shortest supply.
Identifying the Challenge

This is where you find the first steps into CRM. Contact Management or Personal Information Manager software can provide substantial benefits. A database of customers for envelope labelling, simple word processing and calendar functions can save an enormous amount of time. The latest breed of contact manager software can do this quite efficiently across small groups of people, an office based sales team for example. So what’s the point of moving to a full CRM strategy? Why not stick with a simple address book style contact manager?

The real secret of selling has always been to ‘Think Buying’ So consider for a moment, the things that annoy you as a customer:
• Promised return phone calls not made, and information not sent
• Not being informed of possible delays or problems
• That call to tell you when your order is ready – promised but not made.
• One department in the company having no idea what another department said to you in the last call or letter.
• No one bothering to call to make sure the goods arrived, or are satisfactory. Probably no calls at all – until of course they want to sell you something else
• No one knowing what they last sold to you – or when
• No one knowing enough about you to offer you items or services that would enhance or compliment your purchase. Frequently only one person in the company seems to know anything about you! And if they’re not available…?
Overcoming all this takes more than just contact management software.

The Answer

What is needed is a change in attitude that extends from shop floor to boardroom. Not easy! It takes something special to initiate such a major change, but once up and running the change will feed on its own success.
The CRM solution provides a sophisticated but (and this is important) ‘easy to use’ computer system which monitors all activity with customers, current or potential. Phone, mail, e-mail and fax all link in. Give everyone in your company who deals with your customers access to that system. Link it to word processors, accounts systems, stock control and manufacturing Now you’re starting down the right road to achieving your ultimate goal - customers who become Raving Fans.
Your Information Bonus

The additional benefit to a company implementing CRM, is far superior tracking of sales and marketing activities. Suddenly it becomes easier to identify the most effective sources of business. i.e.

• which Mailshots worked best
• which sector provides your best business
• how many leads turn into actual sales

All this information makes running your company so much easier. Your Sales Manager will also benefit considerably from being able to see sales activity and ratios more clearly. He will probably produce the most accurate sales forecast you have ever seen!

Conclusion

So, should you try to implement CRM or just stick with contact management? That depends on what you want to achieve. If your aim is to look after your customers to the best of your ability, keep those customers, and tower head and shoulders over your competitors, it has to be CRM.
 
The History of CRM -- Moving Beyond the Customer Database

Customer Relationship Management (CRM) is one of those magnificent concepts that swept the business world in the 1990’s with the promise of forever changing the way businesses small and large interacted with their customer bases. In the short term, however, it proved to be an unwieldy process that was better in theory than in practice for a variety of reasons.

First among these was that it was simply so difficult and expensive to track and keep the high volume of records needed accurately and constantly update them.

In the last several years, however, newer software systems and advanced tracking features have vastly improved CRM capabilities and the real promise of CRM is becoming a reality. As the price of newer, more customizable Internet solutions have hit the marketplace; competition has driven the prices down so that even relatively small businesses are reaping the benefits of some custom CRM programs.

In the beginning…

The 1980’s saw the emergence of database marketing, which was simply a catch phrase to define the practice of setting up customer service groups to speak individually to all of a company’s customers.
In the case of larger, key clients it was a valuable tool for keeping the lines of communication open and tailoring service to the clients needs. In the case of smaller clients, however, it tended to provide repetitive, survey-like information that cluttered databases and didn’t provide much insight. As companies began tracking database information, they realized that the bare bones were all that was needed in most cases: what they buy regularly, what they spend, what they do.

Advances in the 1990’s

In the 1990’s companies began to improve on Customer Relationship Management by making it more of a two-way street. Instead of simply gathering data for their own use, they began giving back to their customers not only in terms of the obvious goal of improved customer service, but in incentives, gifts and other perks for customer loyalty.
This was the beginning of the now familiar frequent flyer programs, bonus points on credit cards and a host of other resources that are based on CRM tracking of customer activity and spending patterns. CRM was now being used as a way to increase sales passively as well as through active improvement of customer service.

True CRM comes of age

Real Customer Relationship Management as it’s thought of today really began in earnest in the early years of this century. As software companies began releasing newer, more advanced solutions that were customizable across industries, it became feasible to really use the information in a dynamic way.
Instead of feeding information into a static database for future reference, CRM became a way to continuously update understanding of customer needs and behavior. Branching of information, sub-folders, and custom tailored features enabled companies to break down information into smaller subsets so that they could evaluate not only concrete statistics, but information on the motivation and reactions of customers.

The Internet provided a huge boon to the development of these huge databases by enabling offsite information storage. Where before companies had difficulty supporting the enormous amounts of information, the Internet provided new possibilities and CRM took off as providers began moving toward
Internet solutions.

With the increased fluidity of these programs came a less rigid relationship between sales, customer service and marketing. CRM enabled the development of new strategies for more cooperative work between these different divisions through shared information and understanding, leading to increased customer satisfaction from order to end product.

Today, CRM is still utilized most frequently by companies that rely heavily on two distinct features: customer service or technology. The three sectors of business that rely most heavily on CRM -- and use it to great advantage -- are financial services, a variety of high tech corporations and the telecommunications industry.

The financial services industry in particular tracks the level of client satisfaction and what customers are looking for in terms of changes and personalized features. They also track changes in investment habits and spending patterns as the economy shifts. Software specific to the industry can give financial service providers truly impressive feedback in these areas.

Who’s in the CRM game?
About 50% of the CRM market is currently divided between five major players in the industry: PeopleSoft, Oracle, SAP, Siebel and relative newcomer Telemation, based on Linux and developed by an old standard, Database Solutions, Inc.

The other half of the market falls to a variety of other players, although Microsoft’s new emergence in the CRM market may cause a shift soon. Whether Microsoft can capture a share of the market remains to be seen. However, their brand-name familiarity may give them an edge with small businesses considering a first-time CRM package.

PeopleSoft was founded in the mid-1980’s by Ken Morris and Dave Duffield as a client-server based human resources application. In 1998, PeopleSoft had evolved into a purely Internet based system, PeopleSoft 8. There’s no client software to maintain and it supports over 150 applications. PeopleSoft 8 is the brainchild of over 2,000 dedicated developers and $500 million in research and development.
PeopleSoft branched out from their original human resources platform in the 1990’s and now supports everything from customer service to supply chain management. Its user-friendly system required minimal training is relatively inexpensive to deploy. .
One of PeopleSoft’s major contributions to CRM was their detailed analytic program that identifies and ranks the importance of customers based on numerous criteria, including amount of purchase, cost of supplying them, and frequency of service.
Oracle built a solid base of high-end customers in the late 1980’s, then burst into national attention around 1990 when, under Tom Siebel, the company aggressively marketed a small-to-medium business CRM solution. Unfortunately they couldn’t follow up themselves on the incredible sales they garnered and ran into a few years of real problems.
Oracle landed on its feet after a restructuring and their own refocusing on customer needs and by the mid-1990’s the company was once again a leader in CRM technologies. They continue to be one of the leaders in the enterprise marketplace with the Oracle Customer Data Management System.
Telemation’s CRM solution is flexible and user-friendly, with a toolkit that makes changing features and settings relatively easy. The system also provides a quick learning environment that newcomers will appreciate. Its uniqueness lies in that, although compatible with Windows, it was developed as a Linux program. Will Linux be the wave of the future? We don’t know, but if it is, Telemation’s ahead of the game.
The last few years…
In 2002, Oracle released their Global CRM in 90 Days package that promised quick implementation of CRM throughout company offices. Offered with the package was a set fee service for set-up and training for core business needs. .
Also in 2002 (a stellar year for CRM), SAP America’s mySAP began using a “middleware” hub that was capable of connecting SAP systems to externals and front and back office systems for a unified operation that links partners, employees, process and technologies in a closed-loop function.
Siebel consistently based its business primarily on enterprise size businesses willing to invest millions in CRM systems, which worked for them to the tune of $2.1 billion in 2001. However, in 2002 and 2003 revenues slipped as several smaller CRM firms joined the fray as ASP’s (Application Service Providers). These companies, including UpShot, NetSuite and SalesNet, offered businesses CRM-style tracking and data management without the high cost of traditional CRM start-up.
In October of 2003, Siebel launched CRM OnDemand in collaboration with IBM. Their entry into the hosted, monthly CRM solution niche hit the marketplace with gale force. To some of the monthly ASP’s it was a call to arms, to others it was a sign of Siebel’s increasing confusion over brand identity and increasing loss of market share. In a stroke of genius, Siebel acquired UpShot a few months later to get them started and smooth their transition into the ASP market. It was a successful move.
With Microsoft now in the game, it’s too soon to tell what the results will be, but it seems likely that they may get some share of small businesses that tend to buy based on familiarity and usability. ASP’s will continue to grow in popularity as well, especially with mid-sized businesses, so companies like NetSuite, SalesNet and Siebel’s OnDemand will thrive. CRM on the web has come of age!


A Real CRM Strategy or Just Tracking Customers?


Exactly what is CRM
The idea itself is nothing new; its roots have been around since trading began. The principle of looking after your customers so that they come back regularly is, after all, merely the basis of good trading. In an increasingly competitive commercial world however, strong customer relationships take on an increasing importance. With the cost of selling to a new customer being five times the cost of selling to an existing one you can’t afford to lose established business.
Yes, you still want new markets, and yes, for various reasons customers will still disappear. The important thing is to minimise this loss and make sure the reasons behind it don’t stem from something you are doing – or more significantly something you are not doing.

Which is why good Customer Relationship Management is vital – and why the process has now been refined to make it more effective than ever.

What does CRM Involve?

In essence, making your customer feel special by understanding his needs and fulfilling those needs in a personal manner which will keep him coming back for more.

Going that extra mile and providing service beyond that which was expected takes your customer to the next stage, where he becomes a ‘raving fan’ of your business - and you can’t have too many of those. Achieve this and your customer suddenly becomes part of your sales force, telling everyone he meets how good you are.

This can actually be achieved without computers and software. A good memory and a card index can keep track of customer’s preferences and buying patterns. Newsletter campaigns, post sale follow-ups and special offer mailings can all be organised - given time; except that this is where it so often falls apart. For most companies time is the commodity in shortest supply.
Identifying the Challenge

This is where you find the first steps into CRM. Contact Management or Personal Information Manager software can provide substantial benefits. A database of customers for envelope labelling, simple word processing and calendar functions can save an enormous amount of time. The latest breed of contact manager software can do this quite efficiently across small groups of people, an office based sales team for example. So what’s the point of moving to a full CRM strategy? Why not stick with a simple address book style contact manager?

The real secret of selling has always been to ‘Think Buying’ So consider for a moment, the things that annoy you as a customer:
• Promised return phone calls not made, and information not sent
• Not being informed of possible delays or problems
• That call to tell you when your order is ready – promised but not made.
• One department in the company having no idea what another department said to you in the last call or letter.
• No one bothering to call to make sure the goods arrived, or are satisfactory. Probably no calls at all – until of course they want to sell you something else
• No one knowing what they last sold to you – or when
• No one knowing enough about you to offer you items or services that would enhance or compliment your purchase. Frequently only one person in the company seems to know anything about you! And if they’re not available…?
Overcoming all this takes more than just contact management software.

The Answer

What is needed is a change in attitude that extends from shop floor to boardroom. Not easy! It takes something special to initiate such a major change, but once up and running the change will feed on its own success.
The CRM solution provides a sophisticated but (and this is important) ‘easy to use’ computer system which monitors all activity with customers, current or potential. Phone, mail, e-mail and fax all link in. Give everyone in your company who deals with your customers access to that system. Link it to word processors, accounts systems, stock control and manufacturing Now you’re starting down the right road to achieving your ultimate goal - customers who become Raving Fans.
Your Information Bonus

The additional benefit to a company implementing CRM, is far superior tracking of sales and marketing activities. Suddenly it becomes easier to identify the most effective sources of business. i.e.

• which Mailshots worked best
• which sector provides your best business
• how many leads turn into actual sales

All this information makes running your company so much easier. Your Sales Manager will also benefit considerably from being able to see sales activity and ratios more clearly. He will probably produce the most accurate sales forecast you have ever seen!

Conclusion

So, should you try to implement CRM or just stick with contact management? That depends on what you want to achieve. If your aim is to look after your customers to the best of your ability, keep those customers, and tower head and shoulders over your competitors, it has to be CRM.

Well, many many thanks for your help and providing the information on History of CRM. BTW, i am also going to upload a document where you can find some useful information and can also included in your report..
 

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