Customers these days have more power and choice than ever before. Customer Relationship Management (CRM) solutions are the backbone of many organizations, helping to deliver the exceptional service and positive experiences. Choosing the right CRM solution and the right deployment option is critical for businesses to remain competitive.
More and more businesses are reaching for the cloud when it comes to CRM. As of the end of 2018, the cloud hosted nearly 90% of CRM, compared to 2008 when 89% lived on-premise. According to Gartner research, spending on cloud services is expected to increase almost 60% through 2021. Organizations embracing dynamic, cloud-based operating models position themselves for cost optimization and increased competitiveness.
Here are three reasons to consider moving to a cloud CRM:
Cost is the primary factor behind most decisions. Cloud CRM is generally less expensive, but you need to balance all the expenses to determine overall Total Cost of Ownership (TCO). The initial investment is significantly lower, as there is no need for expensive hardware and infrastructure. IT labor needs are also minimized, as there are no on-site servers to maintain. In addition, the cost model changes from CAPEX to OPEX, which is much easier for the business to accept.
Ongoing maintenance for the solution is often a hidden cost for on-premise systems. Cloud solutions often include maintenance and support in the monthly subscription. It is also important to accurately account for the number of users, as this detail factors into that monthly fee. Another hidden cost is the energy usage for an on-premise solution. Assuming an average daily use of 20.4 kilowatts, and an average cost of 10.74 cents per kilowatt-hour, a single server costs almost $800 per year to power. Less IT equipment required means less energy consumed, saving money and reducing greenhouse gas emissions.
Increasing Accessibility and Scalability
One of the greatest advantages of cloud CRM is its accessibility. Today’s employees want to be able to access information at any time from anywhere on any device. The only requirement is a secure Internet connection; however more bandwidth is needed on-site to accommodate larger data files and the appropriate number of users.
While employees want easy access, business leaders need a solution that will easily scale as the business grows. An on-premises solution requires more servers and hardware to support a larger number of users. Additional equipment also requires more IT staff, adding labor expenses. Because the infrastructure for cloud CRM is maintained by the vendor, purchasing additional user licenses would be the only cost involved for the organization.
Keeping Technology Current
Many employees become frustrated when the technology they use at work is less advanced than their personal applications. Many businesses delay upgrades because they don’t have the required time or budget, and it becomes even more difficult to upgrade as each new release passes. Falling behind in technology allows those competitors who stay current to gain a significant advantage.
Cloud CRM allows an organization to keep up with the latest technology. With each new release comes additional security features and new enhancements to the solution. Implementation is almost seamless, with minimal impact to the users, and the costs of the upgrades are included in the monthly subscription.
Security is considered a potential drawback when it comes to moving to the cloud. Everyone is concerned about the implications of a data breach; however, for both cloud and on-premise software, most security breaches are attributable to human error. Odds are for most small to mid-size organizations, security isn’t 100 percent and there may not be enough resources dedicated to IT management. With the cloud, security and management are in the hands of the dedicated experts at the vendor.
Summing It Up
Moving to the cloud represents both risk and opportunity. As cloud becomes increasingly mainstream, it will dominate ever-increasing portions of enterprise IT decisions. For businesses with smaller IT budgets and fewer resources, cloud CRM is a more viable solution as it focuses resources on business goals rather than software maintenance.
At Avolin, we listen closely to the needs of our customers. We ensure that your investments in the configuration of your platform are maintained. Avolin offers a complimentary TCO analysis for customers considering a move to Pivotal Cloud. Contact your account manager or email us at [email protected] for more information.