According to Dyche (34), customer relationship management (CRM) has become a core component in the strategic management of firms. CRM enables firms to be effective in interacting with their customers and suppliers. CRM entails using Information Technology to synchronize, automate and organize different business processes. Some of the business processes that CRM aids in automating relate to marketing, technical support, and customer services. The objective of integrating CRM is to enable firms to attract new clients and retain the existing ones. Additionally, CRM enables firms to minimize the cost of offering services to their clients. CRM software has been in existence for approximately 30 years since the 1980s.
Over the past three decades, CRM technology has undergone significant evolution arising from continued technological innovation (Gregory para.1). Currently, CRM is considered to be one of the segments experiencing fast growth in ERP. This paper is aimed at illustrating the timeline of CRM evolution within the Information Technology industry. The timeline illustrates the major innovations and changes that have taken place within the Information Technology industry.
Evolution of Database Marketing
The 1980s were characterized by the emergence of database marketing, through innovation by Lester Wunderman. In developing the database, the innovators emphasized developing statistical techniques to develop a more comprehensive understanding of consumer behavior. The database developed enabled organizations to undertake personalized communication with their clients. Some of the key contributors to the development of CRM during this period include Kate Kestenbaum and Robert K.
The late 1980s; the introduction of client or server architecture
The introduction of this technology was during the late 1980s was necessitated by the increased utilization of Personal Computers. The growth in the market for PC provided an opportunity to market more software to individuals and companies.
1986 -1st Contact Management Software
During this period, Mike Muhney and Pat Sullivan developed a technology referred to as the ACT. This was the first technology about contact management application. This technology was advanced by other individuals such as Goldmine.
The early 1990s
During this period, the intense technological innovation led to contact management becoming the Sales Force Automation (SFA). Other technologies which emerged during this period include Brock Systems and Saratoga Systems. The innovation of these systems provided an opportunity to organizations to automate standard processes for example about sales professionals. Additionally, these technologies enabled firms to undertake lead management, opportunity management, and deal tracking.
1993- Entry of the Siebel System
In 1993, Tom Siebel developed a system that became dominant within the SFA market. The system enabled companies to streamline some of their processes for example sales.
1995- Emergence of the term ‘Customer Relationship Management
Gartner Company is credited with inventing the term CRM. However, there were other terms such as Customer Information Management (CIM) and Customer Information Management (CIM) which were developed by other companies and individuals such as IBM, Tom Siebel, and John Anton. However, the term Customer Relationship Management emerged as the most appropriate term.
1997- During this period, several companies ventured into the CRM market. One of these companies includes Oracle. The company developed Oracle Sales and Marketing. However, this period was also characterized by the acquisition of Aurum which was a provider of CRM software by a company known as BAAN. Baan dealt with the provision of ERP services.
1998 – Expansion of CRM
During this year, Siebel acquired Scopus culminating in an improvement in its competitive advantage in sales automation. This arose from the fact that Scopus was well established about call center technologies. This led to the expansion of CRM from being a point solution to becoming a broader suite of various marketing applications, sales, and services.
1998 Entry of SAP
This year was characterized by an increment in the intensity of competition within the CRM market with the entry of SAP. The firm established several SAP labs to undertake effective and efficient research and development about CRM software.
1999- Consolidation of the CRM market
As a result of an increment in the number of acquisitions, the market becomes consolidated. For example, in 1999, PeopleSoft acquired Vantive which was well established within the customer support market. Initially, Vantive had ventured into the development of SFA to compete with Siebel. However, the firm was not successful.
1999- Emergence of CRM mobile devices
Siebel introduced a new device known as Siebel Sales Handheld. This became the 1st mobile customer relationship management application. During the following year, other companies such as SAP, PeopleSoft, and Oracle developed their own mobile CRM applications. However, the initial products had limitations about their functionality. Over the past few years, CRM mobile devices have undergone a significant transformation. This has arisen from the high rate of technological innovation which has led to the emergence of smartphones. Currently, smartphones have comprehensive CRM features which have improved their applicability.
1999- Emergence of e-CRM
This year was characterized by the emergence of numerous e-CRM systems which include e.piphany, silk net, kana, and broad base. These technologies were necessitated by the emergence of new internet technologies.
1999- During the same year, salesforce.com ventured into the CRM market as a provider of software-as-a-Service (SaaS). The firm increased the scalability and functionality of CRM. The entry of SaaS was a threat to other firms such as Siebel Systems.
1999- Nortel acquires Clarify
Nortel which was well established within the telecommunication industry acquired Clarify which was a market leader in call center solutions. However, Nortel collapsed as a result of ineffective networking. This led to Clarify being acquired by AMDOCS company which was a software and services firm operating within the telecommunication market.
2001-Retraction of the CRM market
The decline in the market was a result of the burst of the dot-com bubble. This led to firms within the industry incurring a significant financial loss.
2001- Entry of Sage
Sage ventured into the customer relationship market through the acquisition of Interact Commerce Incorporation. Additionally, Sage also acquired SalesLogix. As a result, the firm was able to expand its product offering about CRM.
2001-Introduction of xRM
Paul Greenberg introduced the DRM idea. This entailed the expansion of CRM technology to include management of the diverse organizational relationship.
2002-Entry of Microsoft
Microsoft ventured into the CRM market through the introduction of Dynamics CRM. During its initial phase, the application was limited in its utilization. However, the development of Microsoft Outlook increased its utilization.
2004- SugarCRM entered the market as a provider of open-source enterprise applications. This technology gained a large market, especially among price-conscious institutional consumers.
2006 Acquisition of Siebel
Siebel was acquired by Oracle after a long duration of a continued effort to control the CRM market. Oracle acquired Siebel’s applications.
2007- Launch of Force.com
To establish itself effectively in the market, Salesforce.com launched force.com. This application was a cloud-based application that provided Salesforce.com a platform to develop its SaaS network. The acquisition enabled the firm to seal the gaps in the product in addition to eliminating the perception that it is not possible to customize cloud-based systems.
2009- As a result of different challenges, numerous technological innovations were conducted. For example, Salesforce.com incorporated knowledge management within its Service Cloud to serve its customers effectively. On the other hand, Oracle integrated InQuIras web-self-service application in its applications.
2010 to date
In 2010, more technological innovations were undertaken. Some of the new applications which emerged include Social CRM, Customer Enterprise 2.0, and Sales 2.0. However, most of these technologies have not been integrated into the CRM. Most organizations are currently using the social function. It is expected that more firms will venture into the market resulting in an increased revolution of the CRM sector.
The timeline above illustrates that CRM has evolved. The evolution has arisen from the high rate of technological innovation by different companies. As a result of the high rate of technological development, the future for CRM is bright. This is also enhanced by the high rate at which individual and institutional customers are incorporating information technology in their consumption.
Baran, Roger, Galka, Roger and Strunk, Daniel. Principles of customer relationship management. New York: Cengage, 2007. Print.
Dyche, Jill. CRM handbook, the; a business guide to customer relationship management. New York: Addison-Wesley Information Technology Series, 2002. Print.
Gregory, Alan. Interactive timeline of CRM software industry. 2010. Web.