How to Select the Best Manufacturing CRM Software

CRM Imperatives for the Manufacturing Industry

CRM software for manufacturers must go well beyond simple account, contact and opportunity management. Industrial companies require more advanced capabilities. Fortunately, several CRM applications designed for manufacturing companies accommodate the following manufacturing CRM requirements.

CRM that Improves Innovation

Manufacturing growth and profits directly align with innovation. The best source for product innovation is customer insights. CRM systems that use Voice of the Customer, customer segmentation, rich customer data and other CRM automation to acquire, measure and forecast customer insights will systemically improve innovation.

Most industrial executives think they know what their customers want. And they are partially right. But their inaccuracy stems from subconsciously imposing their own bias, thinking customers are all the same, assuming customer preferences are static, and believing that all customer preferences translate into willingness to pay. Even small inaccuracies in customer preferences result in large losses in sales and customer tenure.

CRM apps designed for industrial companies can engage customers and capture insights to create better products. We're in the age of the social customer. Customers will tell you what they want, and how to improve your products, if you ask them. Their input is valuable in steering R&D to create products that are enthusiastically embraced by customers and create customers that make repeat purchases. But to automate this process you need to record customer feedback by market and customer segment in the CRM system.

CRM software designed for industrial companies supports this process with social engagement tools for customer input, crowd sourcing tools for target market collaboration, self-service tools for on-demand feedback and surveys to measure product satisfaction. These systems include advanced capabilities, such as customer insights and digital crowdsourcing, that scale innovation processes by automating the capture, categorization and tabulation of customer preferences.

Industrial companies that use manufacturing CRM software to collaborate with customers during product design, manufacturing, distribution, sales and service lower their R&D investment and produce more valuable products in shorter cycles.

Failing to measure what different customer segments want at different points in their purchase journeys creates a cascading effect that degrades product R&D, marketing offers, sales conversions, support services and the customer experience. The negative financial impact incurred in any one of these areas is a material financial loss that often goes unrecognized. If your CRM software is not telling you how to build more innovative products, you are missing a big opportunity.

Consumer Insights Dashboard

CRM that Empowers Partners

Industrial companies sell through indirect channels such as distributors, value added resellers, retailers, business partners and independent sales representatives. Indirect sales channels lower sales cost and create a multiplier effect. But they also create a loss of control, poor visibility to customer demand and a challenge to grow customer relationships. That last item of challenged customer relationships can be particularly dangerous.

It is easy for manufacturers to distribute product collaterals, price lists and sales leads to partners. It is hard to get timely and recurring feedback, especially with previously distributed sales leads. A lack of feedback creates a lack of insights and raises many recurring questions. What ever happened to those sales leads I sent you? Why did you use the wrong price list again? What's this quarter's sales forecast look like?

CRM for manufacturers includes a subset for Partner Relationship Management (PRM). This PRM capability is designed to deliver sales enablement to indirect channels and digital engagement that shifts one-way conversations or content flow from the manufacturer to the partner to two-way engagement that gets feedback from the partners.

PRM supports flexible partner programs with indirect channel sales methodologies, varying grants and margins, online partner portals (for training, sales assistance, quote and order processing (including CPQ) and sales returns), lead management (registration, distribution and visibility), a shared 360-degree customer view and partner dashboards with reporting and analysis.

This automation helps manufacturers better manage and scale partner programs with fewer partner management resources, and empowers partner managers to better focus on the larger or more strategic partnerships. As importantly, the PRM technology automates partner onboarding, accelerates time to value, improves the partner relationship and grows mutual success.

CPQ for Simple and Timely Order Processing

To better compete many manufacturers are becoming more agile and evolving from standardized products to more flexible and customer-oriented production methods such as configure-to-demand and make-to-order. But creating accurate and timely quotes and sale orders for small quantity, technical or highly configurable products can incur excessive time, delay sales cycles and frustrate both sales reps and customers.

The best CRM for manufacturing companies solves this challenge with Configure-Price-Quote capabilities. CPQ automation is the part of manufacturing CRM software that helps salespeople quickly quote configurable and complex products, which are often governed by fluid constraints, compound configuration rules and thin margins.

Simple CPQ solutions operate as rules-based or constraint-based order entry configurators. More sophisticated CPQ software solutions, sometimes called compile-based configurators, apply dynamic logic that better supports more customizable products.

Field Service Management to Grow Service Revenues

For most industrial companies services are more lucrative than products. Field service management delivers the automation to support this high margin revenue growth path. Post-sale services also provide an opportunity to use service as a differentiator and directly aid other customer and revenue growth strategies such as growing customer acquisitions, increasing customer share and improving customer retention. To support these and other manufacturing growth strategies, CRM for manufacturing applies specific field service management capabilities that drive downstream revenue growth.

These capabilities lower cycle times by automating resource and asset-based processes such as case entry, work order management, technician dispatch and reverse logistics (i.e., depot repair and RMAs). They also reduce labor costs by optimizing labor consumption and performing workload balancing. They reduce other, often more hidden costs, such as warranty expense and contract leakage.

This technology also aids technicians and service staff with mobility, a 360-degree asset view, inventory visibility and real-time access to online instruction or knowledgebase content.

These capabilities grow revenues by maximizing contract attach rates, renewals and up-sell.

And even more importantly they improve the customer experience by using software capabilities such as customer entitlements, Service Level Agreements, real-time digital engagement (i.e., digital signatures and onsite receipts) and online customer self-service.

The best manufacturing CRM software solutions go even further to improve the customer experience, asset uptime and company profitability with AI that delivers highly accurate proactive and predictive maintenance, optimizes labor scheduling and dispatch, improves spare parts staging throughout the service delivery chain (missing parts are the number one reason for return visits) and maximizes First-Time-Fix Goals (repeat trips are the top cause for unprofitable jobs.)

IoT for Product Insights

The best CRM for manufacturing companies has shifted from tacit integration with sensors and IoT apps to built-in capabilities that leverage customer data and product utilization. By applying sensors to products that show how the product is being consumed by each type of customer, these systems mimic the 360-degree customer view with 360-degree product or asset views.

They also combine the high volumes of IoT data with AI to apply that data for preventive maintenance or planned replacement, shift from reactive to proactive support programs, avoid costly unplanned downtime and increase asset performance and uptime.

Business executives gain never before realized insights when item utilization is measured in real-time. For example, product replacement becomes predictable, inventory flow becomes continuous and product forecasting becomes more accurate. Built-in and extensible IoT capabilities are an area of significant differentiation among CRM applications.

AI for Manufacturer Intelligence

The most significant company intelligence is being created by the combination of Big Data, such as IoT sensor data, and AI. These two synergistic technologies can uncover and leverage data that is absent, hidden or unappreciated in order to deliver actionable insights capable of altering production processes, customer engagement and company business models.

For example, sensory-based data integrated to AI systems can flag deviations, identify patterns and permit simulations to facilitate timely and low-cost experimentation and improve product quality, longevity and performance. But this is only the tip of the iceberg as when this machine generated big data is combined with customer attributes and behaviors it becomes an invaluable source to uncover real-time information about customer preferences, buyer intent and market demand.

Taken a step further, AI can harvest social and unstructured customer data to improve product forecasting. And even small improvements in demand forecasting models result in fewer stockouts, less idle inventory, decreased cash flow requirements and most importantly, more satisfied customers that get your product when and where they want it.

The best CRM for manufacturers offers prebuilt dashboards, template-based data transformation pipelines, predictive analytics and ready-made models that transform IoT or other big data into actionable analytics.

Data Transformation Pipeline

When considering how to use big data and AI, I advise companies not to create yet more fragmented applications and data siloes but to instead make big data attributable to the customer and an integral component of your customer relationship management system.

Even More Capabilities

There are many other industry specific CRM capabilities to aid manufacturers, such as digital commerce, guided selling, intelligent promotion (up-sell, cross-sell and bundling) and seamless integration with ERP and SCM applications. Some CRM solutions also facilitate processes that support lean manufacturing by maximizing customer facing staff productivity and identifying waste or removing steps that do not add value to the customer.

I am frequently asked for my recommendation of the best CRM system for manufacturers. Based on market share, industry fit and my experience from having implemented CRM systems at manufacturers for more than three decades, I generally advise Salesforce, SAP CRM, Oracle CX and Microsoft Dynamics 365. But for a more substantiated answer, I recommend our post that shares a deeper analysis for each of the top manufacturing CRM systems.

If you are evaluating CRM software, consider our software selection framework to quickly identify the best manufacturing CRM system for your company.