FSN: Time to link CRM to ERP and Finance

Time to link CRM to ERP and Finance

12th May 2008
CRM and accounting make for interesting bedfellows as many companies attempt to harness the benefits of the utilising the two in tandem to greater business effect. When integration is carried out effectively, processes can be simplified and streamlined, empowering both finance and sales departments to take a more strategic view of the customer base. Mark Dye , FSN contributing editor reports.

It stands to reason that a customer-centric approach to any business will pay dividends in the long-term. Happy customers remain loyal to brands and make for good returns. With this in mind its no surprise that enterprises have been trying to move customer relationship management (CRM) closer and closer to the finance function of late.

For its part CRM began life developing as a standalone entity, but with the increasing possibilities for integration that we see across business today it is now feasible to have a continuous process flow from sales lead to sales quote and from sales order to sales invoice.

As a result companies are attempting to draw in the finance community by offering productivity improvements for the finance professional, as well as consistency in pricing and therefore control.

But with such moves come problems - a salesperson sees a customer as a means of getting more money into their own bank account for instance. A CFO on the other hand sees a customer as a line item.

These two views are completely different and it's difficult to reconcile them over a single engine or to message to the two different audiences compellingly, says Clive Longbottom, service director, Business Process Analysis, Quocirca. “Although the data is common to both audiences, the needs are completely different.”

“Although they might be viewing the customer from different angles they actually share a common aim; maximising the revenue and profit from that customer over as long a period as possible,” says Keith Webley, senior consultant at Morse. “This common purpose will ultimately drive CRM and ERP much closer together.”

In the past CRM has often been little more than Contact Management with Finance taking over when quotes and orders are raised.

“Historically the sales team had done its job once the order had been raised,” adds Webley.

But today a significant shift in culture sees sales teams being encouraged to develop and maintain a relationship with the customer, with access to more financial data being the key to this.

However, as finance has begun to aggregate and analyze profitability data on a more granular level, and as the marketing and sales departments look to make good on their growth and churn predictions for the coming year, Martin Schneider, senior manager, Product Development, SugarCRM, believes the goals, methodologies and agendas of these disparate departments are colliding.

“As a result, the company is caught in an analysis paralysis,” he says “with neither department trusting the methodology or data the other is using.”

“Integration between CRM and accounting systems should help streamline the activity of the sales and finance departments for the benefit of the business, rather than causing cultural problems,” reminds David Turner, group marketing director at CODA.

He reasons that failing to integrate CRM with accounting means enterprises aren't getting a holistic view of customers and it's this lack of visibility which means companies aren't maximising profits or marketing to their customer base in the most effective way.

“Knowing how many sales you are making without knowing how profitable you are and how that profit is derived isn't useful,” he adds. “To improve customer management and company performance, organisations need a more integrated, intelligent view of the business.”

In order for sales and finance to work together in harmony, Andrew Greenyer, VP EMEA Marketing, Pitney Bowes Group 1 Software, believes both departments need to be able to access information at a customer level.

“CFOs are beginning to see real advantages in this customer-centric approach,” he adds. “The ability to analyse customer types and customer group performance by the finance function is extremely valuable for business planning purposes.”

This means decisions can be made to the level of customer service for example, with enterprises being able to identify high value customer groups where increasing customer service can be allocated, or those of a lower value who may be draining valuable customer services resource.

“With this approach, CFOs are becoming more involved at the strategic level, enabling them to make decisions that will benefit the organisation as a whole, including sales,” he says.

Duncan Wood, product manager, Sage CRM believes it is essential that enterprises attempt to link together existing departmental systems or move to an integrated suite of applications across a business. “With mounting global competition, companies are having to prove how they co-ordinate activity across the company in order to maximise the value they deliver to customers, while minimising costs,” he says.

“All businesses that need to provide a high level of customer service should be looking to align CRM and financial data,” says Jason Nash, CRM Product Solutions Manager at Microsoft UK .

This would include businesses with call centres of any size, those with dedicated sales and marketing teams or, indeed, any business looking to improve customer service.

“To this end, only those businesses with little customer facing activity can afford to separate the two,” he adds.

Webley says that as companies focus their sales effort, everyone, from salesperson to CEO, is being encouraged to log all contact with customers and potential customers.

“Using a CRM system allows an organisation to get a better picture of how they interact with each customer and to identify the key players at the customer,” he adds. “This all helps the company to target their sales effort, whether via a marketing campaign or a simple phone call, at the right people. The result should be a happy salesperson earning commission and a satisfied CFO looking at healthy growth figures - ideally all from a common set of data.”

“Customer-centricity is not a marketing technique, but a whole business stategy - something increasingly recognised by forward-thinking finance professionals,” says Andy Wood, Managing Director, GI Insight. “In fact, this conjunction of finance and marketing around the key asset of customer data is helping each to recognise the other's value in the corporation and, indeed, start strategically working together much more closely.”

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