A tremendous amount of confusion exists about the comparative value of on-demand versus on-premise CRM software. On-demand CRM is fundamentally a deployment option, with attributes that make it a suitable option for some businesses, but many companies are unsure about whether or not it is appropriate for them. The answer, as you might expect, is â€œit depends.â€
There are three relatively simple differentiators that can be useful in understanding the best fit for your business, as you sort through the decision tree. These are: scope; degree of integration; and the importance you place on your customer processes.
Which, and how many, functions need to be part of your customer interaction systems?In many companies the sales department is relatively independent of the rest of the organization. Sales people and managers want to track leads and manage their pipeline, and may be attracted to a solution that can be deployed rapidly and expensed, without a major IT investment. For these organizations, an on-demand solution can be a good fit, particularly in small companies.
Other enterprises take a broader approach and manage all their customer interactions across several departments, e.g. coordinating marketing programs with telesales, or a contact center identifying new sales opportunities during a conversation with a customer. Companies that fit this multi-function utilization profile are better candidates for an on-premises system that can enable these people and systems to work together, primarily because of more complex integration challenges.
What customer data or processes need to be linked to other systems and departments?Integration is often vital to the success of any CRM solution, especially in the services sectors where the major ERP vendors donâ€™t have a significant presence. A typical financial services organization, for example, may need to integrate customer data or documents stored in a variety of vital legacy, or other key infrastructure, systems which are highly customized for a specific purpose. For these organizations the ability to directly access and update data is vital.
By contrast, if you do not need to integrate real-time, or near real-time, customer information with other major systems an on-demand offering may be right for you. In some instances, companies find that transferring data using flat files on a daily or weekly basis is sufficient to meet their data integration needs.
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