IT budgets shrinking but CRM is still relevant

IT managers reassessing the relevance of customer relationship management (CRM)in the current economic climate need to consider how much they value theircustomers.

Queensland Rail general manager of information systems, Tony Welsh said thecustomer focus should be stronger than ever despite the IT economy teetering onthe edge of recession.

He said CRM strategy is a critical business issue in the current economicclimate.

"We're certainly more focused on building customer relationships given thecurrent economic conditions," Welsh said.

"CRM cascades down to us having to focus more on customer-oriented initiativeslike supply chain integration and a portal project for e-procurement."

According to a Deloitte Consulting Global Manufacturing Study, the number ofcompanies adopting CRM technology will increase by 30 per cent over the nextyear.

An estimated 60 per cent of large businesses that use an enterprise-wide CRMsystem will be more profitable than those which don't, the study found.

But just because large companies are working with tighter IT budgets this year,said Jason du Preez, Epicor sales and marketing director, they should notreduce spending levels.

He said some areas of the IT budget can be rationalised, as well as"unnecessary" areas of expenditure like consulting, technology upgrades oroffshore operations.

"I've seen a lot of activity in the market die down, particularly in enterpriseresource planning, because of a lack of dollars and uncertainty," du Preezsaid. "But with more IT executives taking a wait-and-see approach, buyers areputting a lot more emphasis on CRM systems or CRM components to stop customerchurn and achieve faster ROI."

This frugal approach, he said, is proof that businesses cannot afford to forgoCRM in uncertain times.

"For example, these companies need to pay closer attention to online marketingcampaigns to bolster customer support efforts and retention levels," du Preezsaid.

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