The Essential CRM Guide

What is CRM and The Rise of CRM: This article is an excerpt from our free CRM Essentials e-book series.

Updated October 2022

CRM (Customer Relationship Management) is an attitude towards people.

The Comprehensive CRM Guide

The other option is to define CRM as “Computerized Relationship Management,” since computers aren’t able to grasp the subterranean forces that make every association a reality. How can a computer handle relationships when computers can’t sense the emotions that drive our connections? Thankfully, you and your team must handle that part. CRM software may collect and arrange the data that will assist your company in creating better and more powerful customer connections. Despite the fact that the CRM acronym doesn’t correspond to a standard three-letter phrase, we investigate all of the ideas that it implies.

A CRM approach toward people is characterized by the following:

  • People are treated as valued customers.

The CRM model focuses on paying attention to your customers rather than your business in general. The theory is that your company will continue to serve the customers whom it satisfies. Customer relationships, therefore, are an important part of a successful company, in which business owners and managers should exemplify those qualities. Above all, management should cultivate a customer-centric mindset in their employees. This is something we will emphasise again and again: CRM is primarily about building a positive relationship with customers and treating them like important individuals. You don’t need software to handle your spouse, children, or friends in a positive manner (and if you do, this book is not for you) to have a successful CRM strategy.

  • Technologically driven and biased, CRM is a good match for the acronym.

How, you may ask, can a computer manage relationships, when computers are unable to comprehend all of the emotions involved in every relationship? It can’t. You and your employees have to do that work. CRM software can collect data that will help your business build better and stronger customer relationships. Even though the CRM definition doesn’t translate well into a conventional three-letter acronym, we go over all of it in this book.

The Increased Demand for CRM

The CRM industry, which has seen unprecedented growth over the last several years, can be better understood by considering its origins and influences. The customer relationship industry has been around for as long as barter and trade have. Customers, their families, and their needs and weaknesses are all known. As trade and markets have expanded through the use of sailing ships, the variety of goods has changed, however, customer relationships have always been man-to-man and based on face-to-face interaction. We do business differently now than we did in the past.

The modern, institutionalised form of globalization began after World War II with the Bretton Woods conference. The conference, which was economically motivated but politically driven, established the International Monetary Fund, the World Bank, the General Agreement on Tariffs and Trade (GATT) and the World Trade Organization (WTO).

International monetary regulations and free-trade agreements opened the way for the mass movement of goods across international borders. Initially, multinational corporations benefited – although they had to overcome difficulties such as advertising slogans and pay-off lines that were not as easy to translate and that needed to be managed as databases of inventory, customers, and prospects grew. To deal with these issues, computerization was helpful, but computers were costly and needed a large number of employees to operate and maintain them in the 1960s and 1970s, when computers were still costly and required a lot of labour to operate and maintain. This meant that filing and storage procedures were manual or mechanical for all businesses except the more wealthy.

Computer technology was rapidly developing in the 1980s, which resulted in more and cheaper computers and faster and cheaper PC networks. Desktop PCs and local area networks replaced mainframe terminals, thus multiple software systems proliferated across multiple networks. Multiple software systems were present on each network, even within the same company. Worse still, some of the software was running on local hard drives and the data was not centralized. The solution for multinational corporations was to centralize all their data in a database. In the early 1990s, this, together with the looming Y2K problem, signaled the need for enterprise resource planning (ERP).

Nobody expected the thriving Internet, a domain of academic and specialist IT people until the World Wide Web came along, would happen. After web browsers like Mosaic and Netscape Navigator were released to the public, the Web became a popular interest. By 1996, many publicly traded organisations realised that a Web presence was now required, but not an option.

In 2001, the dot-com bubble burst, leaving telecommunications companies with excess capacity. This kept the cost of Internet connectivity low, and individuals used the Internet in greater numbers as a result. Small companies were able to access large international markets via the excess bandwidth in telecommunications.

The growth of CRM systems in the 21st century was influenced by the tremendous increase in Internet usage and web-based sales. Every business can reap the benefits of integrated CRM systems, whether big or small.