Differences in Use of CRM Systems in a Sales Context

Abstract: Non-selling activities, such as sales planning, teamwork, sales support, sales tracking, etc., are important parts of sales activities in any company. Earlier research has shown that the difference between effective and less-effective organizations can be found in the performance of the non-selling activities. This thesis continues investigating the non-selling activities by looking into the matter of Customer Relationship Management (CRM) systems. Implementation of a CRM system requires that the people who are in contact with customers carefully log the activities, a task that according to research is considered to be dull by many people. Studies have shown, though, that CRM systems increase company profitability. Therefore allocating time for administrating them is a good investment. Objective: This thesis studies the administrational CRM activities performed by the sales people and sets out to determine if fast growing consultancy firms in Sweden use CRM systems to a greater extent than comparable consultancy firms in the same country. The definition of fast growing firms has been firms that have received the Gazelle award from the newspaper Dagens Industri, the most known financial newspaper in Sweden. The award recognizes companies that have grown very rapidly in the last four fiscal years, mainly in terms of company turnover. Purpose: Most companies strive for growth. Establishing a link between the time factor and company growth will help organizations motivate themselves into increased use of CRM systems. Method: Collection of data for the study has been done by briefly interviewing 54 Swedish consultancy firms via telephone. Out of these 54 companies, 25 had received the Gazelle award, and the remaining 29 were in the same type of business but selected through random methods. The companies were asked about their use of CRM systems, how important they rate it and in their overall attitudes toward such systems. Results: The companies with very high growth, i.e. the Gazelle companies, evidently use CRM systems to a higher extent than comparable companies, and the difference between the two groups is statistically significant. The majority of respondents in both groups consider CRM systems as useful or very useful (74 % in the ordinary group, 80 % in Gazelle group) but only 31 % of the Gazelle companies and 36 % of the randomly selected companies believe that it is also important for the profitability of the company. Many of the interviewed companies had plans expanding their usage of CRM systems. Although they generally thought positively about CRM systems, due to the fact that some of them did not utilize CRMs at all their profitability cannot be explained by the CRM use only.