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CRM in the Cloud: What you need to know

The art of selling has fundamentally changed. No longer are there simple buyer and seller relationships. We live in a world in which consumers are increasingly in control of how products are designed, marketed and sold. And they are fully aware of the power they wield.

If you have just a handful of customers, providing personalized service is a snap. But for those with a larger customer base, things aren’t as easy. Today’s customer relationship management solutions (CRM) aim to help these companies mimic that personalized attention on a larger scale by providing customer insight and helping companies understand their customers as individuals, not just market segments.

Larger enterprises have long invested in CRM solutions that compile customer data and turn that into actionable intelligence, because they have the budgets and manpower to do so. However, for resource-constrained smaller companies, investing in expensive, long-term CRM implementations often isn’t a realistic option.

While big budget CRM implementations may be out of reach for some, CRM on the cloud is decidedly not. In our interconnected world, engaging with customers is critical for success but can come at a high cost. Cloud computing aims to alleviate that cost and makes CRM accessible for everyone.


CRM on the cloud allows companies to learn and gain value from the experience because the cloud offers a productive working system with little upfront cost in terms of acquiring infrastructure and skilled resources.


Less expensive and faster to implement

Cloud computing is often held up as a great way for businesses to save money. As companies become increasingly price conscious and space conscious, the cloud allows organizations to use only the applications and hardware capacity they need without paying for idle computing resources.

Paul Thompson, UK lead for SAP CRM implementations for IBM Global Business Services, believes that the benefits of accessing CRM applications on the cloud go far beyond just cost savings. IBM helps companies implement IBM SmartCloud for SAP rapid deployment solution, a complete CRM solution that is designed to be significantly less expensive and faster to implement than traditional on-premise CRM solutions. "Cloud not only takes away the headaches that organizations have with regards to implementing solutions, it also helps them keep the software up to date and ensures that the organization is getting the right functionality."

As businesses have increasingly recognized the immediate benefits associated with CRM on the cloud, there has been a significant uptick in companies using it. In fact, some companies are using CRM on the cloud as a fast, cost-effective first step toward an on-premise CRM solution, a larger project which can take up to two years to implement.

Graham Hall, IBM SmartCloud for SAP European Sales Leader, explains, “These companies can get a CRM on the cloud up and running in weeks. For many of those companies that want to dip their toe in the water and eventually implement a full CRM system, CRM on the cloud allows them to learn and gain value from the experience because the cloud offers a productive working system with little upfront cost in terms of acquiring infrastructure and skilled resources.”


Public versus private clouds

While the popularity of cloud is growing rapidly, marketplace concerns around cloud security and reliability remain. In spite of the many benefits associated with cloud, some companies are still hesitant to entrust something as valuable as customer data to something they perceive as out of their control.

And recent headlines haven’t helped alleviate their concerns either. In the past year alone, the media has highlighted several availability issues with some of the more high profile public clouds. “The main question we get from companies considering hosting in a cloud is about security and integrity,” says Thompson.

Rather than highlighting the differences between public and private cloud environments, these cloud incidents have sown confusion about cloud computing in the marketplace. According to Hall, companies need to understand the differences between public clouds, which store resources at an off-site cloud provider’s facilities, and private clouds, which hold capacity solely on a virtual private network. While each flavor of cloud has it benefits and challenges, private clouds provide a much higher level of security and control than public clouds offer - an environment which may be more suited for maintaining sensitive information like customer data.

In addition, some vendors offer internal security tools to bolster the security of the cloud. Thompson recommends, “When considering providers, look at whether they have the depth of understanding in the security space to ensure that the cloud solutions are well managed and secure, not just in terms of being here in 12 months but also in terms of being able to resolve the security concerns and constraints we have in the moment. When thinking ahead, do they have the skills in security software that will enable them to ensure that their cloud solutions are capable in 12 months’ time?”

Getting started

In many respects the more popular cloud becomes, the more crowded the marketplace is with a growing number of technology vendors offering their own versions of cloud. With all the cloud options out there, where does a company considering cloud begin?

Hall recommends that when choosing a vendor, look first at the flexibility of the cloud offering in order to guard against being locked in to any one cloud solution. “When you buy cloud, you need to be future proofed against future architectural options,” says Hall. “And those options could mean as your business grows -- as many midmarket companies do -- can the CRM on the cloud grow with you? Can you add more users, more capacity? And as you grow, you may want to move from a public cloud to a private cloud. Or from a cloud to an on-premise solution. Will I be able to do that?”

Hall points to some of the CRM cloud providers today that fail to offer their customers much choice in the matter. “There are companies out there that provide cloud on almost a commodity basis. You turn up with your credit card and you can buy some time on the cloud. And while that’s very easy to consume and very cheap, you are fixed in their public cloud strategy. If your needs change, you are forced to carry on with the public cloud or start over with someone new.”

For those that want less of a commodity type of cloud, there are providers that offer cloud technologies and services for private, public and even hybrid clouds, allowing companies to select key characteristics of each type of cloud to match their unique workload requirements. While there are cheap cloud options out there, companies should ask themselves whether the cheaper offering will be flexible enough for future growth.

Ultimately selecting the right cloud provider and solution is going to be tradeoff between future flexibility, functionality and cost. Hall notes, “The right cloud provider should start the discussion with what do you want to use your CRM for? What do you need to use it for? What’s your business need? What are your pain points? And it may well be that cloud can help the delivery of that.”

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