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What's the difference between CRM, SFA, and Business Analytics?
I’m confused (and I’d like to believe others are, too) on the distinction between SFA, CRM, and Business Analytics or Intelligence. Some SFA companies want to call themselves CRM , and now CRM responsibilities seem to fall under business intelligence. Where do you draw the line?
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3 Answers
With the noise and positioning created by all the vendors in this space, it can be confusing! But instead of drawing a line, think of it more like a venn diagram. Some of these fall within each other, and some of them overlap. First some definitions:
SFA = Sales Force Automation
CRM = Customer Relationship Management
Business Analytics (sometimes called Business Intelligence) is a broader set of capabilities that go beyond measurement of just the sales process. The subset of BI that relates to sales is sometimes referred to as Sales Intelligence.
It is true that these are often used interchangeably by vendors and the community at large. But SFA and CRM are not the same. SFA is a component of CRM that deals with automating the sales process based on sales and customer data, but CRM also includes marketing and lead generation components. Business Analytics (sometimes called Business Intelligence, or BI) is a broader category which CRM and SFA analytics both fall within.
SFA specifically refers to a set of tools that record all the events in the sales process, as well as all pertinent data driven by those events. SFA solutions automate the collection of this data and instantly propagate it to where it is needed, eliminating much of the manual administration that would otherwise go into managing the sales and customer data. Businesses have many motivations for implementing SFA, but the most prevalent reasons are:
1. To make sales representatives more efficient
2. To provide managers with better insight into their sales staff’s activities
3. To provide visibility into the sales process for other parts of the business
SFA lets sales reps collect customer data in a streamlined manner so they can access it in an organized form when — and often where — they need it. It allows managers to understand what’s happening within their sales pipelines and to change how resources are allocated or how sales reps are selling in near real-time. It also provides data that other teams in the organization can use to predict the need for raw materials, services or other products, and can feed into the finance and marketing systems to improve their effectiveness.
SFA is arguably the most valuable component of CRM, and typically resides at the core of most CRM systems. But many current CRM solutions -- whether premise-based or delivered online as a service -- include marketing, campaign, and lead generation functionality to "feed" the sales pipeline, or "sales funnel". In addition, some fully-functional CRM systems include features to automate marketing processes, track and manage marketing campaigns, and measure the impact of marketing spend. Many of these CRM systems include advanced analytics for conducting sales pipeline analysis, monitoring sales rep performance, and other key sales indicators that can be summed up as Sales Intelligence.
For these reasons, CRM vendors will often claim the high ground, providing all things to all people: CRM, SFA and Business Analytics. And to some extent this is true. But SFA is still the core functionality that you must make sure is going to work for your business before you make the investment in a CRM system.
Adding to Skip Hilton and Mark Barett consider the following (to be read along with Skip's and Mark's comments - treat this from a management and marketing perspective)
Consider Yourself - One person with multiple roles:
- a father to your children
- a son to your parents
- a husband to your wife
- a subordinate to your boss
- a boss to somebody
- a friend to your classmates
etc etc.....
Hence the avatar that you are in at a certain point of time is quite dependent on your perspective to be in a situation. But you are the same single person. However situations do often arise wherein multiple avatars are required to be leveraged upon for attending to such a situation, but again at the end of the day it is "You" the same person.
Taking the above token, what started as an ERP (Enterprise Resource Planning) or more precisely "Database" became CRM, SFA, Business Analytics etc - emerging out of a single source - Data - that was (supposed to be) captured in a sales cycle with upstream and downstream data included. Motives were multifaceted e.g. Relative time of product development (w.r.t competition), comparative advantages of different product development companies and the stage at which their product dev was, Product differentiation, Early time to market, Muscle power to create different nomenclatures and thereby exploiting market ignorance, chance and ability to mould the customer mindset, Disruptive marketing forces, competitive seeding techniques & opportunities etc etc.
Commenting on the last part of your question:
The TRUTH: This is a never ending saga. There is no drawing of line that is possible. The very force behind our existence is tweaking of terms and technologies and nomenclatures to apparently "Innovate". Else the world would come to a standstill. Compare it to an aircraft. Two forces MUST continue for an aircraft ot be in equilibrium once airborne: the jet and the rudder, either fails and it is bound to crash.
Since you are from the Telecom domain, the following example should help you specifically appreciate it better:
What started as a softswitch (and its services) have evolved into fancy terms terms/nomeclatures like IMS, 3G, 4G, LTE, VAS etc.
What created these terms:
- Product Differentiation (By a meagre swapping of MGCP with SIP in a softswitch for the media server, created an entire new offering/industry - The IMS.
- With MSCs being "cobbled" to an IMS over SIP/IP, 3G services were created.
- This brought into limelight new nomenclature - VAS
- Point of saturation with 3G services gave birth to 4G driven by service providers and equipment vendors alike.
- With saturation being reached, LTE is the new mantra.
Another example:
In simple terms: what started as a hosted software services became SaaS. When SaaS reached its saturation, time for innovation - Cloud Computing was invented. Why restrict to software - extend it to infrastrcuture - They call it as Cloud Services.
What to expect further: A new nomenclature created by combining SaaS, SOA, Web 2/3 services, Cloud computing etc.
Yet another example:
Consider the numbers: 5, 2, 1
You can create any number under the sun using these 3 numbers. How?
Example:
8 = 5+2+1
58 = 5+5+5+5+5+5+5+5+5+5+5+3+2+1 = 50+5+3+2+1 (invention has occured by creating "50" as a numeric benchmark block by adding 5 ten times)
108= 50+50+5+3+2+1 = 100+5+3+2+1 (Invention has occured by creating "100" as a numeric benchmark block by adding two blocks of "50"
Conclusion:
Hence one evolves out of the other out of necessity for reasons that may be attributed to demand-supply equilibrium.
Often times you have to go to different companies for CRM/SFA and BI, others will offer all 3 in one product... you can either choose to cobble together a solution with the different pieces or you can buy one that has all 3 in one. Ultimately you want to report on your CRM/SFA so having BI in the mix is the best way to go.
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