CRM on a budget.

• Author: Bernstel, Janet Bigham
• Position: Technology - Wells Fargo & Co. and Bank of America Corp. to make use of customer relationship management software

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Competing as a small bank in a big bank world is getting easier, thanks again to technology. Without the seemingly endless resources of financial giants like Wells Fargo & Co. and Bank of America, smaller financial institutions had to make do with off-the-shelf software or outsourcing for customer relationship management (CRM). But a new wave of Internet-hosted CRM applications is cutting the risk of both the purchase and deployment of these programs.

"The CRM applications market turned an important corner in 2004," states Mary Wardley, vice president of CRM applications research at International Data Corp. (IDC), Framingham, Mass., upon release of a new study in August 2005, "Worldwide CRM Applications 2004 Vendor Shares." "The growth of the relative newcomers as well as new functionality and licensing models from established vendors have rejuvenated the market and turned the spotlight on true customer need."

The study revealed that total CRM market revenues for 2004 reached $8.8 billion. The growth was fueled by a resurgence of demand by users. Buyer's intentions to implement and focus on CRM initiatives remain high in 2005.

Comparing earlier, traditional CRM technology to new hosted applications is like comparing the biplanes of yesteryear to modern jets, according to Roy Karon, president of BVS Performance Systems, a performance support company based in Cedar Rapids, Iowa, that specializes in financial services,

"Small banks can now compete on par with the large banks because there've been such huge leaps in technology," exclaims Karon. "In today's world, the cost of technology is plummeting in direct relation to the speed of the processors increasing."

At the core of Web hosting is Internet protocol (ip), namely the use of the browser as a playback device, and standard hypertext markup language (html). Of course, you need the software to go with your browser and Internet connection.

The BVS product does just about what all others do, says Karon. "It's a very easy to use Web-based system with off-site storage that we can implement within two weeks, versus traditional deployments that take a year or two."

The system takes a feed directly from the bank's core processor and updates customer intelligence information nightly. A contact management feature automatically integrates all referrals with Microsoft Outlook, so leads aren't lost in the pipeline. Frontline staff, service representatives and bank executives alike can access everything about a customer in one place. As for security, it's all encrypted says Karon, similar to the security levels used for Internet banking.

"For those that say, 'We don't open our information to the Internet,' then they don't have Internet banking," states Karon. "If you have Internet banking, you've already opened up your core."

Perhaps the best news for lightly staffed marketing departments is usability. As with many Web-hosted solutions, Karon says that one person can handle everything and...