Contact management

We are going to discuss several features in CRM applications that are useful to be integrated with ERP. The first one is contact management.

Contact management gives users the ability to view, manage, and communicate with their customers. Contact management is the foundational feature for any CRM solution. Contacts include the names of the customers or businesses that you are working with, and the names of the contacts or people who work for the businesses.

With a non-integrated CRM application, if you are doing business with the customer the same customer information will need to be entered again in the ERP application, resulting in the same data being entered twice and a disconnected process.

Contact management workflows

In CRM, the creation of a customer can be straightforward, for example by simply adding a customer's name, and a contact name to the CRM application. To make it useful, you would need some more information such as a phone number or an e-mail address.

A more sophisticated workflow is the creation of a customer from a lead. A business can gather a list of leads, from say, a website, a tradeshow, or by purchasing a data from a third party. You will then need to qualify the leads by converting the raw data to a good quality list of potential customers.

The workflow to qualify leads into customers who you are going to potentially sell to, is an example of a more complex contact management workflow:

Example of a lead qualification workflow state diagram in SageCRM

A lead qualification workflow may have some or all of the following steps:

• Check data: This could be a manual inspection of the lead to ensure that there is enough information to make contact with the customer—for example, is there a first name and a last name, a phone number, an address, or an e-mail address?

• Verify data: The address, zip code, and other contact information for the lead might be verified by using a third-party address verification system, for example.

• Make contact with the lead: This could be an attempted cold phone call, mailer, or sending an e-mail out to the lead to determine interest.

• Contact achieved: If a contact is achieved with the lead, the lead could be converted to a qualified lead, or a potential customer. This would typically move the lead on to a further step in the workflow, or into a sales workflow, where a sales user would attempt to make a sale. Refer to the next section to see the sales workflow.

In an ERP we also store customer information because the ERP is used to send sales quotes, orders, invoices, and shipments to customers. While the ERP is not involved in lead qualification, there is a workflow around the creation of customers, which in ERP are called accounts receivable customers, or A/R customers.

If the ERP is not integrated with CRM, similar customer information that you have added to CRM will also have to be added to ERP. It is interesting to note that the customer information that will to be added to the ERP tends to be a higher quality and is more financially-oriented.

This is because the information that is added to ERP will be used to send valuable documents such as invoices and for the shipping of goods, which are worth money. In order to ensure that the customer is able to pay, and is charged the correct amount, financially important information needs to be captured such as tax information, payment terms, and credit limits.

In an integration between CRM and ERP, it is possible to take advantage of the fact that similar customer information is used in both CRM and ERP.

Integration opportunity for contact management

A non-integrated CRM application is not optimal for doing contact management because it means you need to maintain two separate customer lists, one in CRM and the other in ERP, both of which contain very similar information.

Your ERP contains the full list of the existing customers who you are selling to. Integrating this information with your CRM gives you the contacts you should be communicating with from your CRM system for your existing customers.

If you pull the data from ERP to CRM, you will avoid entering data twice, and connect some of your business processes. The contact information that comes from ERP will be of higher quality and so it will be more useful to your sales users. The customers' data in ERP will also have useful information such as whether or not they are on credit hold, or what their credit limit and payment terms are. This could be useful to a sales person taking an order within the CRM application.

On the CRM side, your new customers and prospects are likely to start off as leads or customers in the CRM system. Integrating with the ERP allows you to automatically promote customers to ERP when you are going to start providing them with quotes, taking orders, and generally doing financial business with them, preventing data from being entered twice.

Workshop

Briefly outline the process by which leads and contacts are harvested for your CRM application and how A/R customers are entered for your ERP application. Can you see a benefit in linking these two workflows so that CRM customers are "promoted" to ERP, and/or A/R customers in ERP are copied to CRM?