CRM (Customer Relationship Management) Software and Its Importance

CRM or Customer Relationship Management is a system that caters to the management of a firm’s interactions with past, present, and future customers. The CRM software integrates the entire customer relationship cycle by automating sales, marketing, customer service, and technical support.

CRM software is a solution that automates the disparate and discreet aspects of the customer relationship management lifecycle and integrates the range of functions that the organization has to actualize customer relationship management.

Further, the CRM software manages the firm’s interactions with their clients throughout the entire lifecycle of customer management starting with cold calling and extending to customer acquisition, and customer retention among other elements. This research article critically analyzes the concept of CRM and CRM software from multiple perspectives.

History of CRM

The concept of CRM originated in the 1970s with the shift in emphasis among businesses from being product emphatic to customer emphatic. The foundation for the CRM paradigm was laid during the 1980s with the introduction of database marketing, and the creation of customer focus groups led to adoption of CRM by SMEs (Small and Medium Enterprises) CRM as a concept and trend became hugely popular in the 1990s as its use ensured that businesses could reap large benefits.

The period covering the 1990s also witnessed a number of advances in the CRM systems. With the business world embracing the internet starting in the 1990s and the consumers taking to the web in a big way starting in 1995, the path was laid for the rollout of CRM to businesses and consumers.

In the previous decade, the demand for CRM software turned into a frenzy with the information age in full swing during this time. In short, it can be said that starting from the 1970s and continuing to this day; CRM began to be adopted slowly and hesitantly by businesses which has now transformed itself into a must have software for any business.

CRM and its Significance

The significance of CRM is that it revolutionizes the customer relationship process by automating the customer life cycle and by integrating the entire customer management process. As has been discussed elsewhere, the use of IT and software to automate the customer relationship process as well as the improved customer management through a holistic approach instead of a piecemeal approach are what makes CRM especially significant.

With the business world and the consumer base using IT widely, the significance of a CRM system cannot be overstated. Further, CRM yields exponential returns to the businesses as it ramps up the customer base quantitatively and introduces qualitative efficiencies into the customer relationship process.

Advantages and Disadvantages of CRM

There are many benefits of implementing a CRM system, and these include better customer management, increased customer acquisition, efficient customer retention, and improved prospecting for new customers as well as reaching out to old customers for rejuvenating the relationship.

The important point to note about a CRM system is that it introduces synergies across the customer relationship cycle leading to greater efficiency and productivity of the employees handling customer relationships.

Further, since the CRM system automates the disparate customer management functions (sales, marketing, customer service, and technical support) along with integrating the entire customer relationship lifecycle, the returns from old, existing, and new customers are more.

One of the main benefits of a CRM system is that it smoothens the customer retention process and leads to more returning customers, which is always a sign of a healthy and productive company. Next, the CRM system helps in complementing and supplementing the physical customer relationship effort and by automating customer touch points; it ensures that there are few errors or mistakes committed during the customer relationship management process.

Finally, the enterprise-wide automation of all functions and processes that many organizations actualize help the CRM subsystem to provide decision makers with a bird’s eye view of the customer relationship process, empower, and enable them with more visibility over the process by giving them data and meaningful information.

The main disadvantage with a CRM system is that it might result in redundancies being introduced into the customer management process because of duplication of effort and the double work associated with sales and marketing personnel unable to adjust to the automation.

The next disadvantage is that the CRM system might result in more complexity, which if not managed properly can lead to chaos and a lack of planning for key activities in the sales and marketing lifecycle.

Third, if the implementation and the subsequent user training have not been done properly, it might result in a workforce that is illiterate as far as the use of the CRM software is concerned. This might result in the workforce being unable to use the system effectively. Finally, the costs from the CRM implementation can sometimes exceed the benefits leading to losses for the firms.


The discussion so far has proved that CRM has become indispensable to businesses in their quest for outstanding customer relationship management in the categories of customer satisfaction, customer delight and customer “wow” are terms that are frequently used to describe the heights to which businesses can attain in their customer management process.

It is evident that actualizing these superlative levels of customer satisfaction is possible with the use of CRM. The adoption of social media and integration of Web 2.0 into CRM systems is bound to transform the customer relationship process.

Finally, with Big Data and Predictive Analytics, the entire customer management process is being revolutionized and this is where the future of CRM lies. In conclusion, customer delight and customer wow are no longer simply superlatives in the dictionary but meaningful and easy to actualize with the use of CRM.

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Customer Relationship Management