Should you build or buy CRM?

Sales

by   MARIA KELLY

Deciding on whether you should build or buy a CRM can turn into an arduous task with plenty of arguments in favor of either choice. In this article we address a few common build vs buy CRM questions and share key considerations to help you make the right decision for your business.

What are your reasons for building a CRM?

Maybe you’re disgruntled with your current CRM and/or find legacy systems too expensive and difficult to set up and use. Maybe you believe your developers have what it takes to build your own custom CRM, giving you more control and flexibility. Maybe you think you can get by with a few tools—like Excel, G-suite—you’ve patched up to create your version of a CRM. Whatever your reasons are, make sure to scrutinize them for any misconceptions and blind spots. To help you do that, let’s take a closer look at a few common reasons why companies decide to build their own CRM.

Building your own CRM doesn’t automatically mean saving on CRM costs. In addition to assuming the cost of the first build, you’ll be also responsible for maintaining and improving the system over time. You’ll be paying for all the research, learning, testing, and troubleshooting. Make a list of all direct and indirect costs to get the full picture. Don’t forget to include human capital, implementation, ongoing maintenance/upgrades, and opportunity cost in your list. Is building your own CRM still a cost-effective and viable option? We’ll discuss what it takes to build a CRM in more detail later in the article.

Customizations

You’ve done a CRM needs assessment and have concluded that your business is truly unique and requires a unique CRM system. There are a couple of things to consider here. Firstly, do your research—there are a number of modern CRMs that offer advanced customization features and capabilities regardless of your industry, business type, or operational complexity. Talk to vendors, request free demos, and look at use cases similar to yours. At the very least, these conversations will inform you on how to approach solving your CRM needs. Secondly, there are layers of customizations and you need to think both short- and long-term to make sure that your system is not so highly customized that it defeats the purpose of a CRM (think data organization, accuracy, and integrity) and keeps breaking as your team and business grow and evolve.

Control & risk management

Some companies want to maintain control over the build and avoid taking a risk with a vendor. Prior CRM vendor experience(s) that fell short of expectations can make it really difficult to build trust with a new vendor. Once again, getting clear on your CRM needs, taking time to research providers, and understanding the terms of your CRM contract can make a huge difference in the long run. Also, keep in mind that a homegrown CRM is not a risk-free investment.

What would it take to build your own CRM?

The scope, necessary resources, and the timeline for building a CRM depend on whether you are coding a CRM software from scratch or patching up multiple third-party tools, like Excel, and G-suite, to create a version of your “own” CRM. A lot also depends on the size and complexity of your business operations as well as your CRM expectations. Here is a list to get you started.

Product roadmap

If you are coding a CRM, then you’ll need a product roadmap that will address both your immediate needs and overarching business value of a CRM. Will your system include workflow automation? What about reporting and analytics dashboard? Will you need to incorporate third-party technology solutions? How will you align teams around your product roadmap?

IT, financial, & operational resources

Whatever your cost and timeline estimates are—multiply by a few times and prepare for results that may still fall short of your original vision. You and your team will be learning as you go and you’ll make mistakes. It’s part of the process. Some companies spend years and hundreds of thousands of dollars on building their own CRM systems only to realize that they can’t update and innovate the system fast enough to keep up with their business needs and growth.

Your sales, marketing, and customer support teams won’t be shy about their wish lists of features and capabilities, and they’ll want them delivered sooner rather than later. With all the pressure and expectations, building a CRM may cause you to shift focus and divest resources away from your core product/service and revenue generating activities. Are you prepared for that? Can you afford that? Most companies that build their own CRMs rarely, if ever, spend 100% of their time on the project.

CRM implementation & upkeep

Building a CRM is only the first step. You have to plan for implementation, staff training and adoption, ongoing maintenance and system updates. Keep in mind that once you promise your team a CRM that will be custom built for them, they’ll expect it to be easy-to-use, match their unique preferences, and solve all their pain points. It can take anywhere from 9 to 16 months to get the system to an operational level and some features might be already obsolete by then. Can you dedicate a developer (or a team of developers) to monitor system performance, continuously improve it, and create a process for ongoing maintenance that can survive staff changes and other company changes?

What are the risks of going with a CRM vendor?

Anytime you purchase a business service or tool that’s integral to your own company’s operations, you’re taking a risk. What if your business outgrows the CRM that seems ideal for right now? What if the pricing changes drastically and you haven’t planned for it? Is your CRM vendor going to invest in continuous improvement in product and customer support? Will your team adopt the tool and use the system as intended to make the most of it? Will the benefits justify the costs?

These are all important questions and the only way to mitigate the risk during the decision-making process is to make sure you do your due diligence with CRM needs assessment, vendor research, and selection. Request demos, read analyst and customer reviews, ask the right questions when talking to CRM vendors, etc. Don’t lock yourself into considering big brands or niche industry players. Look at CRM providers’ underlying technology and customer support to determine whether they can scale with your business and support your team as your business changes. Some companies set up a selection taskforce to make sure they get key input from all their stakeholders, including daily CRM users and IT managers.

There are risks associated with both buying and building a CRM. And, there’s a real danger of overlooking your internal risks. Often companies have one developer/project lead in charge of their CRM system, and once that person leaves, the system begins to fall apart. Sometimes companies overestimate their ability to build a CRM and by the time they realize it, they’ve spent so much time and resources that it’s harder to switch.

How are you going to measure CRM value?

At the end of the day, it comes down to value. Most modern CRM providers, like Insightly, have been working on product features and maximizing CRM value for businesses for many years. Their entire business model depends on creating more value for users like you, and building scalable CRMs is their core competency.

When thinking about CRM value, consider both your immediate needs, such as solving long-standing management and operational challenges, and reaching your growth goals. Will a homegrown system provide you with maximum CRM value over time? Considering all costs, risks, and goals, how will you measure the value of your CRM?

Your decision on whether to build or buy a CRM will have a consequential impact on your business for years to come. Take time to think it through, research your options, and make a decision that will stand the test of time and set up your business for success.

Read more like this:

|