E-CRM Deployment Options

A significant challenge facing companies today concerns investment in electronic customer relationship management (e-CRM) solutions. There are a number of implementation options available to organizations, and this week I’ll attempt to break down the pros and cons of the most popular deployment strategies.

Option 1: In-House Implementation

By far, the most popular method of implementing an e-CRM solution is to bring the entire infrastructure in-house. Now, this approach affords companies the greatest degree of customization and flexibility. Application packages and networks can be tailored to address specific business requirements. However, owning your own e-CRM infrastructure carries many ongoing investment requirements and responsibilities.

Pros	Cons
Complete e-CRM architecture	Significant initial and annual investment
Freedom of application choice	Responsible for ongoing maintenance
Integration with legacy system	Increased labor expense
Greater control over infrastructure	Speed of implementation
Greater levels of flexibility
System architecture can be a competitive differentiator

Option 2: An ASP for Specific CRM Solutions

An ASP manages and delivers packaged applications from an off-site location distributed via a wide area network. In most cases, an ASP aligns with a specific solution vendor to resell capabilities for a monthly fee. Although an ASP may offer a menu of solutions from various vendors, its service normally does not include building and maintaining integrated system architectures.

What ASPs provide is accelerated deployment speed and skilled support resources. Normally, an ASP will have significant service strength related to a specific package, accelerating implementation schedules. However, ongoing maintenance or integration with legacy infrastructures can be problematic if the provider has very limited industry expertise.

Pros	Cons
Deep functional and technical expertise with specific applications	Siloed approach to e-CRM
Rapid implementation	Addresses very narrow solution set
Lower capital investment requirements	Support personnel have limited insight of business drivers and customer needs
Addresses resource constraints	Limited integration with legacy systems

Option 3: Outsourced Customer Contact Centers

The third option for companies seeking to implement e-CRM solutions is outsourcing specific customer contact point to third-party service providers. The classic example is contracting a call center support company to handle all inbound support calls. In the online arena, a number of service companies handle specific processes, such as email campaigns and response management.

Outsourcing specific functions to third parties is a rational choice for organizations seeking to lower the marginal costs of maintaining customer relationships. But there are system and process implications to consider. Data management with your support provider is a challenge, one that could sacrifice the quality of a customer’s experience.

Pros	Cons
Lowers operational costs of e-CRM infrastructure	Low level of technical expertise
Rapid deployment	Poor data or process integration with in-house infrastructure
Managed by seasoned professionals	May lack industry or domain expertise
Greater level of accountability

Option 4: e-CRM Solution Hosting

Service providers that host the entire e-CRM infrastructure offer many solutions to the challenges presented above. These service offerings, which are described as managed solution providers (MSPs), help companies address the technical, financial, and operational issues related to building a highly scalable infrastructure for e-CRM.

MSPs represent an evolution from first-generation ASPs. The greatest differentiator is that MSPs offer companies integrated solution sets rather than support for individual packages. MSPs invest their efforts in building the integration layer between applications and resell this capability for a monthly fee.

For example, an ASP may offer complete support for a sales force automation package. An MSP, however, typically offers to support the same package and integrate processes with other applications, such as customer analytics and call center support.

Pros	Cons
Offers integrated solutions	Problematic integration with legacy applications
Lower capital investment	Limited industry expertise
Rapid deployment	Must manage service-level agreements (SLAs)
Accountable support	Limited package selection
Allows organizations to focus on developing new programs

What Is Your Plan?

As you have read, a number of options are available to companies seeking to implement e-CRM solutions. Overall, organizations should consider the following when deciding on a deployment strategy:

• Capital investment barriers
• Complexity of business needs
• Speed of deployment
• Appetite for ongoing maintenance and support
• Level of change within industry

These guidelines can often lead you to the proper decision for your organization. I would be interested to hear the decision criteria you have used in implementing your e-CRM solutions.