A Rolodex may be handy for phone numbers, and so-called "tickler" files certainly have their uses when it comes to customer follow-up. But small businesses today have access to powerful new tools for managing customer relationships and seeking new prospects.

A variety of technologies commonly known as customer relationship management (CRM) applications are available industrywide from a number of vendors. These CRM tools help you save time by enabling you to better monitor critical sales data: existing and potential accounts, individual contacts who work at each customer company, and other important information such as account sales history. Easy-to-use reporting tools in these applications also allow you to run reports that will help you spot and analyze trends and forecast sales cycles to boost sales.

Small businesses stand to gain value from CRM software in two vital ways:

  • They'll help you save time. Thanks to CRM tools, fumbling with hard-copy sales lead lists and fishing for data in separate computer systems can be things of the past. Savvy businesses can now use tools-including the Internet-to help streamline business processes and communicate with customers. For example, digital calendars that are accessible by all employees help coordinate efforts, remind employees to follow up with certain contacts and accounts, and increase visibility into sales force utilization and availability.

Some small businesses also give their customers access so they can schedule appointments online-this helps reduces costs and saves employees time by automating administrative tasks. The more time you can save by streamlining activities, the more likely you are to generate creative new ideas, reach out to new customers and keep your current clients happy.

  • They allow you to focus on customers. CRM applications help you better understand your customers, including their purchasing history. Determining common characteristics of your most profitable customers enables you to focus on boosting relationships with these clients and identify where to center efforts on securing similar leads. This data can provide strategic direction to help you develop marketing campaigns and sales strategies while increasing the impact of your company's marketing messages. In addition, detailed information will allow you to interact on a more personal level with customers in order to deepen those key relationships. Personalized communication will help you boost sales and delight customers regularly.

The key to success for many small companies is their ability to act quickly on new opportunities and follow through on promises and obligations. By reacting nimbly to business opportunities when they arise, and proactively cultivating others, you can more easily compete with your larger rivals.

Oregon-based Game Face Inc. has found this to be the case. Game Face is a small but growing company that searches for, trains and places sales reps and business executives for major professional sports franchises. They currently have 14 employees working in three offices.

"Much of our revenue is based on the effectiveness of our follow-up," says Tom Peterson, senior vice president for business development at Game Face. "We follow up on 2,000 resumes per month, we follow up with 200 of our professional sports team clients, and we follow up with our [sales] academy clients. In a sense, we're one huge follow-up machine."

To increase its effectiveness, Game Face installed several new technology products, one of which was Microsoft Office Professional Edition 2003, which includes Microsoft Office Outlook 2003 with Business Contact Manager, designed to help small businesses stay in touch with key contacts. "Now we can [follow up] better than ever before," Peterson says. "More efficient follow-up could effectively add another $650,000 to our bottom line in the next 12 months."

When shopping for a CRM program, you should consider a few critical factors that can help you get the most for your money. First, consider the compatibility of a new contact management system with your existing technology environment, as well as the ease of deployment and use. Look for a CRM system that allows contacts to be shared with other employees and that gives you the ability to transfer data into and from other applications.

Most important, keep in mind that the best CRM products offer powerful features for organizing contacts and linking them with related accounts and suppliers. Consider products that offer the ability to automatically consolidate all documents-such as e-mail messages and notes related to an account or contact-in a single place for easy retrieval. Finally, take a close look at the reporting capabilities to make sure you're able to view, customize and analyze data according to your business's individual needs.


Nigel Burton is the general manager of the U.S. Small and Midmarket Solutions & Partners groupat Microsoft and is responsible for developing the strategy and programs that drive Microsoft's marketing efforts to small- and midsized businesses.