CRM Tip Sheet

No matter what size your company is, there's a CRM solution for you. Depending on your needs, here's what to expect — and what to watch out for when it comes to selecting CRM technology:

Small Businesses

What it will Cost: Off-the-shelf contact-management products like Best Software's ACT!, FrontRange's GoldMine, or Microsoft CRM range from about $180 to $400; application service providers like Salesforce.com, NetSuite, or Salesnet hover in the $50 to $65 range per user, per month.

What to Look For: Return on investment is at the top of most small business owners' minds. Off-the-shelf software economically provides the basic services. "There is huge functionality in those boxes, and for only a couple hundred dollars, you can share data and automate processes," says Barry Trailer, a partner with CSO Insights, a sales research and benchmarking firm, based in Mill Valley, California. If you're opting for hosted providers, you may have to "bend your business processes to match their model, rather than the other way around," Trailer cautions.

What to Watch Out For: If your sales force consists of you and your partner, don't pay more for things you don't need. "It's not necessary to know a forecast if you've got your two salespeople sitting right there," says Zach Nelson, CEO of hosted CRM provider NetSuite. "Functionality like forecasting or territory management is overkill."



Midsize Businesses

What it will Cost: About $50 to $65 per user monthly for hosted services; midmarket CRM software licenses (like SalesLogix or SAP Business One) can range anywhere from $2,500 to $4,000, depending on the suite; consulting services, which are usually needed to fully exploit the technology, can push the price into the tens of thousands to implement.

What to Look For: Flexibility is key for growing companies, so making sure your software grows with you is important. On the other hand, complex systems might require more maintenance and staff down the road, so determine which will be most cost effective. As companies grow, so can the complexity of problems, says Brooke Savage, chairman of sales-force productivity software provider Pragmatech. "Particularly for a midmarket company, infrastructure issues are critical, and many of them can't afford these big, lumbering sales systems."

What to Watch Out For: Make sure that the software's functions fit with your business goals, and that there is a champion who will drive the project, says Steve Ciarciello, CEO of CompuData, a CRM software and consulting services provider. And even though software isn't necessarily safer than a hosted solution, some companies may opt for additional security measures. For those who err on the safe side, costs like virus and hacker protection should be incorporated into your total investment, he says.



Large Businesses

What it will Cost: The sky's the limit. Software from the big players like SAP, Siebel, Oracle, and PeopleSoft can cost millions to purchase and implement.

What to Look For: Even large companies can do CRM overkill, Trailer says. Don't end up paying for a $10 million contact manager. Specialized software applications that truly help resolve your internal business pains and help share best practices are the most effective, he says.

What to Watch Out For: Currently, large-scale implementations typically have the lowest ROI and customer satisfaction ratings, according to Trailer's research, but that may be because the CRM space is still young, and it's too early to have realized the full benefits. "There is a long implementation period, and in some cases, the jury is still out," he says.