Top 8 reasons why hosted CRM can shut down your business
Yeah… another sensationalist title to grab eyeballs but you know what? I think there is enough reason for companies, especially the SMBs to seriously consider the pros and cons of going for a hosted CRM or else the consequences can be disastrous for them.. including as the title mentions - a shutdown of your business.
- The total cost of ownership (TCO) of their hosted CRM solution after 3-4 years. If you are running an SMB operation and you are set to soar after finding your feet three years from inception, you may find that your budget constraints (SMBs are budget constrained) do not allow you to keep up with the hosted offering’s upgrades and monthly subscription costs.
- Hosted CRM vendors are not known to offer prior notice before shutting shop or hiking prices. In these situations, what happens to your data and what if you are unable to fork out what the price hike demands.
- Similarly, at the end of a contract, what happens to your data? Hosted CRM vendors are not known for offering good migration support or migration tools
- Every hot new technology has eager businesspeople rushing to make a quick buck. If you get caught with a half-baked vendor whose marketing spiel is better than his service, then you are in trouble. A fly-by-night operator can mean serious damage for your business and reputation.
- The carrot of low-cost dangled by hosted vendors can often lead to SMBs following a vendor-defined path instead of adapting the CRM to their business processes.
- SMBs grow and when they do, they need customization, hosted services are not exactly known to offer great customization, its a cost and these vendors play on the cost not on the service. A growing company can suffer serious customer service setbacks if it cannot get the customization needed to align its processes in one direction.
- A hosted CRM is workable only when there is connectivity, what happens to your company’s mobile workforce when there is no connectivity; their output suffers and this affects business.
- Data security!! - Yes, can a third party really offer the kind of data security that you desire. Its your call, maybe they do for the kind of business that you run. But remember that customer data is the lifeblood of a CRM operation and data with a third party can be more vulnerable to hacking and theft from competition.
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May 26th, 2008 at 12:38 am
[...] Although hosted CRM companies are mushrooming by the day and the march of SaaS seems to keep moving forward onerously, helped now by the promise of Storage-as-a-Service, the jury is still out on whether SaaS CRM is a good fit for all or can hosted CRM harm your business. [...]