Definition: CRM

(Customer Relationship Management) An integrated information system that is used to plan, schedule and control the presales and postsales activities in an organization. CRM embraces all aspects of dealing with prospects and customers, including the call center, sales force, marketing, technical support and field service. The primary goal of CRM is to improve long-term growth and profitability through a better understanding of customer behavior. CRM aims to provide more effective feedback and improved integration to better gauge the return on investment (ROI) in these areas.

Sales force automation (SFA), which became available in the late 1980s, was the first component of CRM. SFA, call center and automated field service operations were on parallel tracks in the 1990s and began to merge with marketing in the late 1990s to become CRM. Like ERP, CRM is a very comprehensive system, and numerous packages provide myriad options.

According to Glen Petersen, author of "ROI: Building the CRM Business Case," the most successful CRM systems are found in organizations that realign their business model for profitability, not just redesign their information systems. See XRM, sales force automation and supply chain management.

The Business Case for CRM

Glen Petersen's "ROI: Building the CRM Business Case" is a guide for CEOs. Its numerous examples and case studies give managers insight into what creates success and what causes failures.