The battle for the business soul – CRM

 Need a good CRM system for your business? Kevin Kevany takes a look at the highly competitive market in New Zealand – plus the stories behind some of the brands, the pull to the cloud and the need for total integration with other applications.

 Want to galvanise a flagging lunchtime chat with your mates? Mention you are considering installing a customer relationship management (CRM) system in your business. An immediate mix of howls of derision and standing applause are guaranteed to follow.

It’s come to be regarded as a seminal milestone in the progress and maturity of any business. But it seems this decision often becomes the scene of a battle between the bookkeepers and the administrators on the one-hand, and the sales and marketing types on the other. The former would opt for an “add-on from a reputable software house, which won’t interfere with the main accounting functions of the organisation”, while the latter will have been convinced to “restructure and realign the whole business to meet customers’ needs, and the accounting and payroll systems will just be tweaked to fit”.

It’s the ultimate square-off, in fact. Or, “the battle for the soul of the business”, in the words of Ted Jordan, Queenstown-based CEO of ActionStep, a CRM specialist.

And, if you are seeking comfort – or opting for “what people do overseas” – the news is bad, according to founder and CEO of Hawkes Bay-based Woogloo, Terrence Bull: “New Zealand is way ahead in the CRM innovation-stakes here. We are on to it.”

This is reflected in the competitive CRM market that exists here for everything from add-on software, and sophisticated, stand-alone products, to the latest ‘cloud’ offerings. Your budget, number of employees, type of business and even business philosophy will channel your choice.

If you are still thinking “this sounds like something for the ‘Roundtuit box’”, you need to appreciate that a business with an organic CRM system in place is deemed to have its intellectual property (IP) captured and transferable. And that is said to beat any promise of an owner/manager to introduce the buyer to all of the customers.

That, at least, should have got your attention. The other good news is that certainly the vendors we focused on aren’t looking to retire on the proceeds of their next sale.

But it does take commitment to be flexible and adaptable. For that there is a promised pay-off that will run for years, vouches Bull, who has nearly 30 years in the game.

“When you talk ‘systems’ to SME owners/managers initially, they are inclined to glaze-over. After all, a good number of them only went into business for themselves, because they weren’t terribly good at the corporate systems they were escaping from.

“SME owners’ thinking tends to bounce all over the place. They are lateral thinkers; they have to be. And they are usually juggling too many things in their heads at any one time to have a chance to work on their businesses rather than work in them,” he says, recalling the large number of entrepreneurs who have lost their families, because their businesses have kept dragging them back to work on simple issues, “which technology should have been taking care of”.

If you ask Travis Rosevear, country manager New Zealand, Act Today, he will immediately cite the case of a Kerikeri plastics company which slashed the time it took their sales staff to prepare a quote by a staggering 70 percent.

And, because Sage ACT! had tailored the system to ensure that all the necessary permissions were met before the quote could be actioned, it eliminated any chance of the ‘SME-killer’ – the business-busting under-quote.

“We aren’t techno-experts who move in, flog you a box and some software, and then charge you a packet to install something which your staff will give up on in a few months, because they themselves are not techno-experts,” says Rosevear, who manages New Zealand and Queensland, Australia. “Our people are business professionals, dedicated to improving productivity (administration) and efficiency (process). Since we are assisting you to manage and grow your business through the relationship you have with your customers, it goes without saying that we are 100 percent committed to our own relationship with you.” 

What’s behind the brands

So there is an interesting feature here: all three of the top people in charge of these independent CRM suppliers in our SME market are remotely based. Bull regards that as the proverbial proof- in-the-pudding. His 200-plus global operation is run out of a small office in Hastings, by two people, “proving what the right business approach, backed by appropriate technology, can do for you”. Although he is peeved that he recently lost an opportunity to land a large New Zealand organisation’s business, because the potential customer opted for the local agent of a big brand with none of the readily available support – “because they knew the brand name”.

But surely an established brand has to be considered? More than 27,000 customers and 1.7 million users worldwide are now using Microsoft Dynamics CRM. This includes tens of thousands of customers that have signed up for the latest release since January 2011, according to Hamish Haldane, Microsoft Dynamics marketing lead in New Zealand.

“It equips business professionals with access to customer information through a familiar Microsoft Outlook experience which, because of our large customer-base of users, helps ensure rapid user-adoption and fast results. And with Microsoft Dynamics CRM Online, you get the same powerful CRM software delivered as a ‘cloud’ service from us, enabling instant-on anywhere access, predictable pay-as-you-go pricing, and a financially backed service level agreement (SLA).”

Haldane describes the experience of AuditMyBooks, a company which delivers SaaS solutions to help small businesses protect financial resources from errors and possible fraud, by automatically analysing their accounting systems’ financial transactions.

“They were formerly a Salesforce.com customer, but came to Microsoft Dynamics CRM Online, because the company needed a flexible solution that would be tightly integrated into its sales, marketing and operations, to support the company’s rapid growth.

“According to Steve Bachman, CEO of AuditMyBooks, none of the out-of-the-box dashboard solutions were what they needed, but with our support ‘it was quick and painless to get the dashboards configured specifically for our requirements’,” says Haldane.

 Clouds and integration

ActionStep’s Ted Jordan has a BSc degree in electrical and electronic engineering and a 20-year software career in the US. Before making the decision to move to New Zealand, he says, he commissioned a group at UCLA to research 500 local SMEs, to obtain unique insights as to the challenges and techniques being applied in this market.

“The ERP (Enterprise Resource Planning) approach that huge corporations have used for years is now available to SMEs through our cloud-based solution. Plus there’s no need to maintain a server or back up data – this is all taken care of for a small monthly fee per user.

“At a time when Kiwi businesses desperately need to find efficiencies and battle back from the recession, here is an easy win. On average, our clients experience a 20 percent productivity boost in terms of lower costs and increased growth.

“The status quo for 99 percent of local SMEs is having many separate (or crudely integrated) software tools such as:

• MYOB or similar for accounts.

• A payroll system, or outsourced as a service.

• Outlook or similar for email and calendars.

• Procedures mapped out somehow, often in MS Office documents.

• Generally, a number of paper-based processes.

• A CRM system.

“This is clearly an inefficient arrangement, with double-handling of data; little staff collaboration; poor insights across the business; and little ‘institutionalisation’ of knowledge – especially important when training new staff or when a business owner wants to sell.”

Given his own expertise, Jordan produced his own code, based on the “open” system, in creating ActionStep, and encourages his customers to sell their own version of the ActionStep solution to companies which they believe might benefit from their application. More than 40 law firms, the government, tradesmen, and an aluminium smelter are but some of his customers.

“A very common perception of CRM, especially in smaller businesses, is essentially a contact database with the ability to attach notes and emails to the contact records. However, true CRM has a far greater scope and touches all aspects of an organisation.

“The relationship with a customer typically begins before you have the first conversation; the initial impression of your company, in a customer’s mind, is often formed by your marketing material and website, and sets the expectations of the relationship. This is what will convince them to make that initial call and to continue the relationship all the way through the sales process, operations, invoicing, payment reminders, and delivery of the final product.

“And the relationship doesn’t end there. Ongoing interaction with the customer through newsletters, courtesy calls, handling of queries and complaints, all contribute to a healthy relationship with your customer. If a client calls to query an invoice, the person on the phone needs to be able to see the whole history with the client in an instant, and make them feel special. None of this is possible in a simple contact database,” Jordan says.

What you get with a good CRM System

• A well-organised team with centralised information to give quick, effective customer service.

• All communication with clients tracked – call/meeting notes, correspondence etc integrated.

• Leads tracked and developed to close sales.

• Follow-up tasks, appointments set.

• Central file for documents, such as sales proposals, presentations, etc.

• Quantified sales pipeline to support better revenue forecasting.

• Fully-integrated with operations, accounting, and post-sale activity.

• Insight into success rates of different lead-sources and sales people.

• Improved ability to sell more to existing customers, identify and manage key accounts.

• Add consistency and effective qualifying of prospects with structured sales processes.

• A platform for continuity in times of growth or staff turnover.

• Cloud-based solutions now provide the opportunity to provide access from anywhere for mobile sales teams, including by mobile devices such as phones and iPads.

 Many options

In this business niche, Sage ACT! has 2.8 million customers worldwide – and to give you a comparative snapshot, according to them, the next two biggest CRM brands are Salesforce.com and Microsoft CRM, with approximately 92,000 customers for the former and around 27,000 for the latter.

And they claim to lead the industry in ease-of-use too. Rosevear says “You can get 25 percent more work done by using Sage ACT! compared to competitive solutions.”

Clearly as the dominant supplier in the market they are doing more than just getting one or two things right. Here is an edited selection of what Rosevear thinks you’d need:

“You can take full advantage of familiar solutions you’ve already invested in – including Microsoft Outlook, Word, Excel, and Lotus Notes. Most importantly, your Sage ACT! and Outlook contacts are automatically synchronised to eliminate double-entry, plus keep your calendars in sync – no matter where the changes were made.

“There’s the flexibility to personalise and tailor our system to fit the way you run your business by designing views, adding fields and tabs, editing drop-downs, and customising templates – all the while relying on Silent Install4 administration and activation, and utilising automatic backup, maintenance, and synchronisation options,” Rosevear adds.

Of course, Woogloo’s Terrence Bull and ActionStep’s Ted Jordan would tell you that their offerings are specifically tailored to the New Zealand SME market and that their total approach to sitting down with owner managers and key staff to literally see if there is a wall behind the wallpaper (and then whether or not that wall is truly necessary) is really the way to go.

“Sometimes you feel you need to toss in a hand-grenade and start all over. But by and large, we work through all the business processes that are in place and the ones we find aren’t there, and ought to be.

“Once we have jointly agreed the essence of the business and its essential processes – notice I haven’t mentioned the accounting system specifically – we go away and design something tailor-made, integrate it and train staff. And then support it with our monthly charge of $60 per month per user. That’s the way to do it,” says Jordan.

The last word comes from Terrence Bull, whose Woogloo offers a basic package at $1,350 through to $13,735 for the Brand Hero: “In reality, if more business owner managers had a better understanding of what a business is and how it fundamentally operates, then we would see fewer ‘train wreck’ businesses leaving bad debts and dissatisfied customers behind.”

  Kevin Kevany is an Auckland-based freelance writer. Email [email protected]