Why aren't SMBs using CRM?

Tha answer to Craig's initial question is pretty clear if you are working in a midsize or larger company- we should be beyond that . If you are a solo entrepreneur or in a small sales team, you have probably tried more than once to use a traditional CRM solution like Salesforce and walked away because of complexity, and/or the inability to reflect how you do your business. Plenty of good reasons why SMB's have not embraced CRM and each reason is a legitimate concern. Doug's comment resonates when he quotes Tom Siebel saying "...accounting is easier than accounting." That HAS been true up until recently.

Lori nailed it with her reflection that CRM is only for the big boys.

I will use the analogy of accounting for SMB. Up until Quickbooks, keeping accurate, proper financial records was a nightmare. As Quickbooks has evolved, there are now even teenagers running small business activities with this solution. There is a very low barrier to entry for a business to use Quickbooks- it is fast, flexible and there are plenty of consultants in your local area to help if you need it.

CRM solutions and it's newest addition to the family-Social CRM, is now entering the stage in which Intuit's Quickbooks adaption really took off. There are a surprising number of web-based, easy to use and customize, affordable solutions. One of the leaders in this emerging pool is Nimble, from the creator or Goldmine. Nimble prefers to call themselves a "social relationship manager", reflecting the significant impact and value of social media.

A good definition of Social CRM comes from Paul Greenberg: “CRM is a philosophy & a business strategy, supported by a technology platform, business rules, workflow, processes & social characteristics, designed to engage the customer in a collaborative conversation in order to provide mutually beneficial value in a trusted & transparent business environment. It’s the company’s response to the customer’s ownership of the conversation.”

Here is a list, in no particular order of some of the affordable social CRM solutions that even a one-person operation could deploy and benefit from:

Magnet.com
Batchbooks.com
Nimble.com
Landslide.com
Sproutsocial.com
Highrisehg.com
SalesNexus.com

If you are running your sales process on Outlook and a calendar, give one or two of these a try, I think you might be pleasantly surprised.

Hi Craig,

One subset of SMBs that are not using CRM is SMBs that have tried it and have abandoned their CRM for a variety of reasons.
Reasons may include lack of:
- training
- uppper management support
- proper configuration
- appropriate integrations
- use incentives
- value to the sales team
- data cleansing before implementation
- ease of use
and a host of other problems.

Improper planning and implementation of CRM is not unusual.

I have helped several SMBs that had stopped using their CRM software to properly plan and execute a resart. In each case, those SMBs are now getting their originally envisioned value and more from their initial CRM investment.

SMBs often underestimate the the CRM planning and implementation process or overestimate their internally available skillsets in doing that work. Or they believe that the investment in the software should be all that they have to spend. SMBs with a sales team of as few as three or more salespeople are smart to invest not just in the software, but also in the expertise of a good consultant. That's the best way to insure that their software investment is well spent... and well used.

I’ve put hundreds of sole proprietors onto Act! and GoldMine over the past twenty years. Back then there was no Outlook and spreadsheets were for crunching numbers rather than visual databases.

For the past 10 years sales people left on their own used Outlook for managing contacts, calendar and email. They organize their sales efforts in spreadsheets with status notes for deals they are working on. In fact many salespeople do this even when they have a CRM system furnished by their company because they feel they can better organize for their own style of selling and don’t want to share data. I can prove that they benefit more from sharing their data with the company but that’s a different question.

The most recent trend is to use cloud based systems such as Hotmail or Gmail.

For many years I felt GoldMine was the best product for a sole proprietor even though Act! was slightly easier to use. GoldMine had a usable email client built in so you could look up a contact and see all the email history, phone call notes, attachments etc. in one place. In fact I have many users on a version that hasn’t changed much in the last twelve years. We managed to get that version to run on Windows 7 and they are happy.

For my small business multiuser CRM implementations I now use Microsoft Dynamics CRM. The users are very happy with its ease of use and ability to be easily customized for their unique business requirements. Small businesses need more customization than larger organizations as business method differentiation is part of their competitive edge. That’s why many small businesses haven’t embraced CRM, the rigid structures of past CRM systems were too difficult to mold to their processes.

An insight in Tom Siebel’s 1st book is relevant to this discussion. The reason accounting was automated before relationship management is that accounting is far simpler. This reinforces one of my tenants of small business CRM. It’s as important as your accounting and you should put the same effort into learning how to use it - otherwise don’t bother.

Synchronization with handhelds was one of the major reasons I moved most of my customers out of GoldMine. The simplest method is to use Hosted Exchange server and Outlook, Outlook is provided as part of the service and you can sync as many computers and phones, tablets, laptops and desktops as you want and it works effortlessly. Outlook is a great Personal Information Manager (PIM) but contact management is its weakest component.

If you aren’t tracking a sales or service process with your customers you can get by with Outlook. Microsoft has been offering Dynamics CRM at $34/month with no minimum user count so I’ve put quite a few sole proprietors on it. I can customize it much more rapidly and extensively than past versions so the overall cost is reasonable. I moved away from salesforce because I felt the small business versions were too crippled although some users might be happy with that feature set. There’s a multitude of online CRM vendors catering to different customer segments so it might pay to look into what others in your industry are using. My personal view is that small businesses are best going with a major product that is likely to be around for a while because support will be widely available.

When ACT! was first introduced in 1987, sales people jumped on it because it worked the way they did. It was intuitive to someone who wanted a place to pull contact profile cards out of a box without having a box of 3x5 cards. You could put lots and lots of notes on the "back" of the card without stapling more cards together. Your calendar was connected to your contacts and you could log your calls. It was reasonably easy to write a letter to a contact and run reports, as long as you didn't want to modify a standard report.

I started using ACT! in May, 1987 and the first thing I did was import about 20,000 contact records from a Tandem system. My database had two lines for the address, ACT! had only one, and my address lines were 40 characters long while ACT! had a 27 character field. I started calling Mike Muhney and complaining. Apparently others did also because in the next release ACT! had two address lines of 50 or 60 characters. That's how the whole tower of CRM started to collapse. Now I have a phone with enough power to send a man to the moon, but darned if I can find your phone number.

I don't have Tom Siebel's book at hand to check the wording of his quote, but accounting was automated first not because it's "simple," but because it is rigorous. In 1494 Luca Pacioli, a mathematician and Franciscan friar, published a book on mathematics and geometry which also documented how Venetian merchants used a double entry accounting system to keep their books. We use the exact same system today. The specifications for coding the system are clear and understandable. If the debits and credits are not equal, something is wrong.

Almost any accounting system will make sense to an accountant or bookkeeper. (The one's that don't, don't last long in the market.) You don't have to teach them how to "use" the system. They know. Just show them which button to push to call up the chart of accounts. In the case of Quickbooks, you don't even have to know how to use the system; just a basic awareness that money coming in has to be classified as something like "income," and money going out has to be classified as something like "rent."

Now let's take a look at how people use CRM.

Can't speak for anyone else, but I simply don't have the time or the budget to look at things like this. Maybe if you could explain why we need it and what it all entails? What benefit is there to a one man business for example?

I think there is a tipping point with small businesses where the number of relationships to be managed simply can't be managed without some sort of organisational system in place to manage it.

At a basic level most small business owners will use some sort of task management tools to manage their interactions and use calendaring to remind of emails and calls that need to happen; etc.

However, usually the work load for such a business, particularly the one man business, can simply be handled as part of that person's workload; and as such there is no need for them for CRM. When the point comes that things are getting missed, balls are being dropped, and emails and calls are piling up - that's a good indicator that some sort of CRM solution is needed.

I'm only now getting into using CRM (PipeJump). In the past it was easy enough for me to manage all my clients, but it started getting messy to manage. Why I didn't use it in the past? I needed something simple enough that I could learn in 5 minutes. And free or almost.

We are a Salesforce.com consulting practice specialising in working with SMBs/SMEs and have a very busy practice and successful company. We have been specialising in this area for almost three years now and have hundreds of small business clients of all sizes from sole operators up to those with 100 or so employees. Most of our clients have 10-20 staff.

In some ways, small business has more to gain from the use of CRM than larger coporation where it is just another tool. It can automate and streamline processes in a manner that can saves the need to pay for extra labour, it can impose the discipline of a sales process where prehaps there wasnt one before which usually results in more sales. It gives management visibility to key metrics in their bsuiness which they havent had previously which leads to better quality and more timely business decisions. Last but not least, a cloud based CRM can directly save costs from in terms of not having to buy and maintain IT infrastructure. Further, when the management realises that Salesforce.com is not just a CRM but is indeed a platform for the entire business, they can often remove existing costs by through elimination of existing infrastructure.

Small Business always struggles to find money for marketing and with Salesforcecom CRM they can determine their return on investment for all marketing activities including Google Adwords Campaigns. This means they can direct their limited funds to where it has the biggest impact for them.

Sure, big business also reaps these rewards but a well implemented CRM in a small business tends to have a positive effect on the bottom line a lot faster.

We are a Salesforce.com consulting practice specialising in working with SMBs/SMEs and have a very busy practice and successful company. We have been specialising in this area for almost three years now and have hundreds of small business clients of all sizes from sole operators up to those with 100 or so employees. Most of our clients have 10-20 staff.

In some ways, small business has more to gain from the use of CRM than larger coporation where it is just another tool. It can automate and streamline processes in a manner that can saves the need to pay for extra labour, it can impose the discipline of a sales process where prehaps there wasnt one before which usually results in more sales. It gives management visibility to key metrics in their bsuiness which they havent had previously which leads to better quality and more timely business decisions. Last but not least, a cloud based CRM can directly save costs from in terms of not having to buy and maintain IT infrastructure. Further, when the management realises that Salesforce.com is not just a CRM but is indeed a platform for the entire business, they can often remove current costs by through elimination of existing infrastructure.

Small Business always struggles to find money for marketing and with Salesforcecom CRM they can determine their return on investment for all marketing activities including Google Adwords Campaigns. This means they can direct their limited funds to where it has the biggest impact for them.

Sure, big business also reaps these rewards but a well implemented CRM in a small business tends to have a positive effect on the bottom line a lot faster.

We are a Salesforce.com consulting practice specialising in working with SMBs/SMEs and have a very busy practice and successful company. We have been specialising in this area for almost three years now and have hundreds of small business clients of all sizes from sole operators up to those with 100 or so employees. Most of our clients have 10-20 staff.

In some ways, small business has more to gain from the use of CRM than larger coporation where it is just another tool. It can automate and streamline processes in a manner that can saves the need to pay for extra labour, it can impose the discipline of a sales process where prehaps there wasnt one before which usually results in more sales. It gives management visibility to key metrics in their bsuiness which they havent had previously which leads to better quality and more timely business decisions. Last but not least, a cloud based CRM can directly save costs from in terms of not having to buy and maintain IT infrastructure. Further, when the management realises that Salesforce.com is not just a CRM but is indeed a platform for the entire business, they can often remove existing costs by through elimination of existing infrastructure.

Small Business always struggles to find money for marketing and with Salesforcecom CRM they can determine their return on investment for all marketing activities including Google Adwords Campaigns. This means they can direct their limited funds to where it has the biggest impact for them.

Sure, big business also reaps these rewards but a well implemented CRM in a small business tends to have a positive effect on the bottom line a lot faster.