CRM in Procurement: From 1999 Until Now
It’s no secret that customer relationship management (CRM) software helps procurement executives better-set priorities, allocate resources, and react to changing market conditions. Through a systematic approach that evaluates sub-tier networks, companies can determine how their suppliers contribute to their success and develop ways to improve their performance. Yet four recent trends—digitalisation, personalised customer experiences, scarce resources, and global instability—have spiked corporate interest and launched next-gen CRM programmes. Here’s what you need to know…
A Short History
When CRM solutions were first introduced in 1999, only a small number of organisations jumped on board. To be fair, the software was new, slightly confusing, and extremely pricy. Yet before long, the first open-source CRM hit the market, solutions migrated to the cloud, and suddenly, even small businesses and startups could use CRM software. Widespread adoption triggered huge drops in price—which in turn led to greater adoption.
Fast-forward to 2009. Gartner held its first Customer Relationship Management Summit, which set certain standards and guidelines for CRM going forward. Over a decade later, Gartner predicted that CRM will be the single largest revenue area in enterprise software spending in 2021. How’s that for rapid change?
Now let’s talk about the future. In 2021, many industry leaders predict that CRM solutions will shift from standardised platforms to specific, bespoke solutions. Organisations will create and measure KPIs that track their unique progress and procurement focus. According to Stan Garber, Scout RFP’s president and co-founder, the following are some key KPI areas for procurement firms to highlight:
- Rate of opportunity creation
- Per cent of purchases in budget
- Project inbound versus complete/cancellation date
- Project duration by state (from input through close to review/renewal)
- Efficiency per employee and group
- Supplier volume/per cent of contractual commitments
- Financial impact
Three Focus Areas for Development
- Real-time data. CRM software should send automated information about suppliers, global shipping/freight conditions, and factory issues straight to procurement teams. The time for email chains and Googling is long over—updates should come straight to you. If an Indonesian factory is in flames, procurement must know.
- Corporate memory. As employees spend less and less time in a single job, workplace knowledge must remain intact. CRM software should capture what’s happened over the course of a supplier relationship, such as past contracts, face-to-face meetings, and fulfilment records.
- Saving opportunities. Procurement teams can’t just collect data—they have to act upon it. CRM software should help identify opportunities for cost savings and improved supplier performance. For example, criteria-based searches can help procurement managers find nearby Indian factories if a local supplier falls through.
Obviously, these changes won’t happen overnight. But ‘with a new mindset and the right tools to support it, procurement is headed for an exciting transformation’, said Garber. ‘As scary as that might sound to some, moving beyond the traditional goal of cost savings to enable far-reaching initiatives and benefits will ultimately help procurement drive company-wide success’.
Critiqom land four-year multi-million-pound procurement deal
Critiqom, a Scottish-based communications business, recently announced its ground-breaking multi-million deal, which will see those accessing services through Scottish Procurement given the option to modernise their communications approach.
By providing an increased amount of choice in communications, the company says it will succeed in ensuring a reduced environmental impact linked to mail production.
The Opus Trust Communications company, which is accessed by the likes of local authorities, police, universities, central government, and other public sector bodies, insists that choosing a local supplier to aid in enhancing the efficiency of public sector communications would subsequently speed up its goal to go green.
“This is an opportunity to look at the bigger picture and to use our knowledge to accelerate change for public sector organisations in Scotland,” says Director at Critiqom, Gerry Crawley.
“We know that we can deliver great efficiencies and cost savings by encouraging the public sector in Scotland to adopt a new approach that embraces digital technologies.”
The tender also introduced a second lot, focusing on digital communications and hybrid mail, in an attempt to administer reduced costs for its customers. All services within the framework agreement will also be delivered in-house.
It seems the overall aim for the deal with Scottish Procurement lies with innovating and modernising the communications sector, resulting in lower prices and an increased focus on sustainability.
Who is Critiqom?
Based in Bellshill, Scotland, Critiqom supplies omnichannel solutions for companies, businesses, and organisations, all while claiming to provide innovation and drive engagement simultaneously with reducing the costs of its operations.
Its vision: to become the UK’s multi-channel communication service of choice. But how is it aiming to get there?
Critiqom insists that by spearheading customer communications with partnership and modernisation, they can achieve exceptional levels of service and choice delivered to their clients. By churning out consistently high-quality operations and by generating revenue with an emphasis on sustainability, it intends to achieve the reduced costs in communications that its clients are looking for.
Why sign the deal now?
Increasingly, more and more companies are being put under pressure to ensure their carbon footprint and sustainable strategies are aligned with, or surpassing, competition in their field. As attention is drawn to the climate and concerns arise over the sustainability of large companies in the future, the majority of businesses are battling with time to decrease their impact on the environment and ensure policies are put into place to show their progress.
Crawley states that, where possible, the company aims to provide as little distance as necessary between manufacturing and the recipient. The tender boldly claims it looks to help steer the direction in which organisations think and showcase how digitalising communications can only serve to benefit the economy and environment on a large scale.