CRM software may be the single most important piece of software that you buy. Almost every successful financial professional will tell you that the single key to their success is the strength of their client relationships. The client relationship is enhanced by regular communication. CRM software systematizes those communications so that clients receive the care they need.
In addition, efficient practices employ uniform workflow processes. Good CRM software can be used to manage and record all workflows within the firm. CRM software can do much more. It can help track and analyze the profitability of each client relationship. It can help track the productivity of employees. With this information readily available, the personal financial planner can set fees appropriately. In fact, it is impossible to optimize a personal financial planning firm without good CRM software.
CRM software falls into both the general productivity category and the industry specific category because you can purchase it either way. Within each category, there are both traditional desktop server software options and online, or applications service provider (ASP) options. ACT! and Goldmine are examples of traditional general products you may be familiar with. Salesforce.com and Oracle CRM (formerly Siebel) are example of online solutions.
The biggest advantage of using a general program like one of the above is that they are widely distributed, so there are many people trained on these systems. Employees may have used one of these systems at a former employer, which can keep training costs low. In addition, there are many independent consultants that can help you configure and maintain one of these solutions.
The greatest disadvantage of using a general CRM program is that it must be configured to meet your firm’s needs, and it must be maintained in the future so it continues to meet your needs. A related problem is that in order to properly configure a CRM system, you must know what you need it to do, and you must know what it is capable of doing. Many advisory firms are weak in these areas.
The greatest advantage of using an online product is that your CRM solution is available to you anytime, anywhere, as long as you have an Internet connection. This can also be its greatest disadvantage, particularly when you are at the mercy of a slow Internet connection.
As a general rule, advisory firms that purchase products in the general CRM category tend to underestimate the cost of configuring the software, training staff to use it, and maintenance. When comparing the cost of an industry specific program with a general purpose one, be sure you don’t fall into this trap.