You’ve heard the term CRM (meaning customer relationship management) thrown around, but do you really know what it is?

Customer relationship management (CRM) is a broad term. It encompasses different stages of an organization’s relationship with a customer or contact. Though the “CRM” term itself is more popularly used for the sales and some service aspects of the CRM relationship, a CRM system can be much more. It comes under different names. For example, contact management system, service desk system, trouble ticketing system, customer order management system, are all parts of a CRM system. They manage part of the relationship with the customer.

Customer Relationship Managment Systems Can Be Simple

A CRM can be as simple as associating names to telephone numbers on your phone. That way, when someone calls you can easily identify the person and see the call history. By doing this you are already beginning to manage the relationship. But that’s a simple function of a CRM.

Customer Relationship Management Systems Can Be Complex

A CRM could be as complex as routing emails to a specific customer service queue. Routing based off specific criteria in the message and sender of that email. This requires creating workflows usually with advanced logic. Or, the CRM could involve an engagement plan where a set of pre-configured activities  are scheduled for a new prospect. Activites can include tasks, automated emails, scheduled calls and appointments with the prospect. This allows for engaging the prospect automatically over time in the hopes of converting them to a customer. This is another example of more complex functionality that a CRM system provides.

Customer Relationship Mangement Systems Can Encompass Multiple Business Areas

You perhaps noticed I’ve already touched on three different system areas – contact management, sales, and service. They are all part of managing the customer relationship. And still, this is not a finite list of CRM related systems. Some organizations may use their CRM tool just for sales, just for contact management, or just for customer service. And some may use it for all of these.

So What Is A CRM?

You can see that a CRM system can be very involved. In basic terms, a CRM is technology which allows you to manage customer and contact data, relationships and communications with these customers and contacts. This includes all interactions with a customer from your first touch point, even prior to becoming a customer. By keeping comprehensive data on customers and relationships with contacts, you can make better informed decisions that can boost your sales, customer service and overall operations.

For example, you are better able to: