In the professional services arena, large and small firms alike are
finally abandoning spreadsheets in favor of CRM systems made especially
for them.
In fact, commercial CRM adoption among professional
services providers stands at 86 percent, according to "The 2012
Professional Services Maturity Benchmark" by Services Professional
Insight (SPI) Research. That's in stark contrast to 2009, when the
Technology Services Industry Association (TSIA) reported that only 55
percent of professional services teams were using an enterprise CRM
product and 29 percent had budgeted for new or additional CRM tools in
2010 and 2011.
This surge in service industry CRM adoption
underscores the increased emphasis service organizations are placing on
selling and marketing. In the services industry, more than in any other,
customer references are the lifeblood of sustainability and growth.
"Client references have a strong correlation with service marketing
effectiveness, the length of the sales cycle, and the ease of getting
things done," the report's authors, Jeanne Urich and R. David
Hofferberth, managing directors at SPI Research, wrote. "Client
references are a leading indicator of organizational success. As this
percentage increases, so does the probability of high levels of growth,
higher bid-to-win ratios, and lower sales costs."
Vincent Scarinci, director of business development
solutions at Hubbard One, a Chicago-based solutions provider to the
professional services industry, also sees greater competition among
service providers as a motivating factor. "What we're seeing now is a
bigger uptick in people shopping around for services based on
experience, pricing, etc.," he says. "Customers are putting work out for
bid. That trusted source now has to compete for business that it
previously would have secured over a luncheon. They are fighting for
business harder than they've ever had to before."
Also driving
this trend are other outside pressures, including market consolidation,
tighter government regulations, and economic conditions. "The
professional services market is getting sandwiched between market
contraction and pricing competition," Scarinci says.
The industry,
he adds, is still lagging behind other verticals in its overall CRM
adoption, "but it's closing in fast. In the past two years, we've seen
an amazing turnaround in business processes and the way firms handle
those business processes."
One of those business process changes is a move toward the adoption of cloud-based solutions.
The
SPI Research report notes that in the professional services sector,
cloud services providers have "significantly outperformed" on-premises
software providers.
One problem is that few CRM systems are
integrated with other business applications. Less than 15 percent of
respondents in the SPI Research survey have integrated their CRM and
financial systems directly. "Greater integration among enterprise
applications yields greater operational and financial results. Ideally,
these solutions [should be] integrated out of the box or easily
integrated through standard interfaces, which do not require extensive
upkeep and expensive maintenance," the report noted.
Scarinci
acknowledges a lack of integration, but says that is starting to turn
around as well. Professional services firms today "see a bigger need for
integrations with CRM and their front-end solutions. As work comes in,
they see the need to integrate all the data earlier."
Gone, too,
are the days when CRM systems were used primarily for basic list
management and customer contact information storage, according to
Scarinci. "We see a lot more sophistication in the process," he says.
Of
particular note is a greater emphasis on analytical data, with firms
wanting to know more about the success of marketing campaigns, and being
able to apply that information to customer records and other CRM system
information. "Companies want…better data around customers and business
prospects," Scarinci says.
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