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Chapter 12 • Customer Relationship Management 347

IMPLICATIONS FOR MANAGEMENT
Managers introducing a CRM system in their company should remember that there are management
implications for introducing a new system.
CRM is a strategic business solution and not a technical solution. Management there-
fore must not introduce CRM technology as an afterthought; rather, it must be part of the
enterprise management solution. When organizations make a decision on a new ERP system,
they also need to incorporate CRM in their vision because it is much easier and economical
to implement CRM with the ERP system, rather than to do them separately. Even when a
company does not have a budget to implement them together, it is still advisable to have
a CRM solution in their vision and planning efforts and to roll out the two technologies at two
different time periods. Another reason management should consider CRM as a business
solution is that successful CRM implementation requires a proper mix of good people,
business processes, and information technology. Management is in the best position to decide
on this mix.
CRM should not be implemented as a single system or at one time. Companies should try
to implement a system step by step (i.e., function by function). When considering a CRM imple-
mentation, there will be pieces of systems scattered all over (e.g., in sales (maybe a few),
customer service). Start with the one where the need is most critical. Make sure there is buy-in
from individual users and departments, as well as from management. Furthermore, the CRM
implementation team needs the ongoing monitoring and involvement of top management; other-
wise, their company may have a great CRM solution, but it will not be used effectively to
improve the company’s bottom line.
CRM systems come in a variety of shapes and sizes, but there is no real off-the-shelf
solution. Every CRM implementation is unique and must be customized to the needs of the
organization. CRM systems include a basket of technologies (i.e., market research, sales
automation, and customer service) that can be implemented as a hosted solution or installed
in-house on the company servers. There are benefits and drawbacks for each option that
management needs to evaluate based on the organization’s business, resources, in-house
capabilities, and other factors. Another choice that management has to make is whether to go
for a best-of-breed CRM solution or to select one vendor to support all the CRM require-
ments. In recent years, the CRM market is moving toward few vendors due to consolidation,
mergers, and acquisitions, so selecting one vendor does have its advantages in vendor support
and maintenance.
Even though CRM provides a great solution for one-on-one individualized marketing, it
also provides good mechanisms for privacy and ethical violations. CRM and other technolo-
gy-based processes that collect data on consumers have come under fire because there is great
potential for the misuse of information. Organizations spend millions of dollars to keep
databases secure from theft, loss, damage, or manipulation from hackers. Unscrupulous
corporations have been accused of using customer data to coerce buyers by using high
pressure or fear. There is also some debate whether the collection of consumer data encroaches
upon one’s right to privacy. Legislation has been passed that restricts collecting data from
children, although they are a powerful buying segment. Many companies have pledged not to
sell collected data to outside vendors or, if an Internet-based transaction is the source of data,
consumers are often given the choice to opt out of such offers. Still, much of the CRM
activity is self-regulated because the government cannot effectively regulate a constantly
evolving technology.