B2B CRM for manufacturers

Posted on 8 Apr 2016 by Malcolm Wheatley

TM’s IT Editor, Malcolm Wheatley seeks the advice of CRM experts to examine its relevance in a B2B context, as well as, where manufacturers have found the concept to be most helpful.

Middlesex-based Polyco is the UK’s largest supplier of protective gloves, selling to garden centres, builders’ merchants, and the UK’s major supermarkets groups, as well as, selling directly to other manufacturers in the food service and catering industries.

Already a user of a Microsoft Dynamics NAV ERP system, the company engaged Microsoft Dynamics CRM specialist K3 CRM—part of the K3 Business Technology Group—to implement Microsoft Dynamics CRM, and integrate it seamlessly with the company’s NAV system.

“Our existing ERP system did offer some rudimentary marketing functionality, but we needed more,” said Polyco’s head of IT, Neal Carter.

“For example, we wanted to be able to share crucial customer information more easily with our internal and external sales people, and with our customer support teams. This would allow us to collect important customer data, and capture the requirements of end users of our products while enabling us to proactively manage our sales and services using much more information than we could currently access manually.”

In short, a perfect use-case for a Customer Relationship Management (CRM) system. And for businesses looking to boost sales and increase customer loyalty, such systems have undeniably had a good press.

But look closely, and many of these are in business-to-consumer (B2C) environments, and not the business-to-business (B2B) environments in which many manufacturers operate.

Which begs some obvious questions. How useful is CRM in a B2B context, for instance? Where have manufacturers found CRM to be most helpful in a B2B context? And what advice can CRM experts offer as to how best to leverage CRM in B2B environments?

PQ CRMThe answers to such questions can go a long way towards helping prospective CRM users among the manufacturing community decide if CRM is likely to prove a worthwhile investment.

“Many of our manufacturing customers can’t live without their CRM systems,” said Pieter Hamans, principal product marketing executive for manufacturing at CRM provider Exact Software.

“Especially if they’re contract manufacturers with lengthy sales cycles and follow-on activities such as commissioning or maintenance, then CRM provides a 360-degree view of the entire sales process, helping them to shepherd bids through the relevant internal processes.”

Indeed, added Larry Augustin, chief executive of CRM provider SugarCRM, CRM is most helpful in a B2B context precisely because sales cycles are longer than in B2C situations, and are spread across many more individuals and internal functions.

“In B2B, you have a team of buyers, and a team of sellers,” he pointed out. “So you have to orchestrate and coordinate that interaction, and get across a single, consistent message that’s apparent to both sides.”

Within the buying organisation, that task is handled by procurement function, using procurement systems such as Supplier Relationship Management (SRM) systems. Within the selling organisation, the role falls to CRM.

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And to that extent, CRM actually helps manufacturers actually fight back in such a context, says Mark Pullar, managing director of All My Systems, a Microsoft Dynamics CRM reseller.

“There are a lot of tools out there to help corporate buyers become very well-informed, and better understand the stature of the business that they are proposing buying from,” he pointed out.

“CRM provides a way of redressing the balance—giving the seller an insight into how they are performing, and how they might be being perceived by buyers.”

Nor should all this be a surprise, said Amir Jafri, chief technology officer at Microsoft Dynamics CRM gold partner eBECS, pointing out that CRM was initially designed for just such B2B interactions, with CRM’s early roots being among the salesforce automation systems in use by American technology vendors in the 1990s.

Modern CRM systems, he added, have simply taken that core ‘contact tracking’ capability, and gone on to model business processes within the CRM system— including business processes handled by partners such as fulfilment providers.

“The upshot is that it’s a richer transaction set, with a lot more collaboration,” he enthused. “You’re not just taking orders.”

That said, at root CRM need not be complicated, stressed Paul Black, chief executive of Sales-i, a provider of CRM solutions exclusively for manufacturing and distribution businesses. Three simple data points cover most requirements, he said.

“When did I see the customer last? What did we talk about? And when am I seeing them again? With the answers to these, you can run all sorts of reports and analytics.

And with three more data points, you can add even more insight: What has the customer bought from me? What has the customer not bought from me? And what should the customer have bought from me, based on normal behaviour, that they haven’t yet bought from me?”

Roll it all together, and it’s no surprise that CRM providers are feeling bullish about the B2B market.

In particular, said Alison Brown, marketing manager at Microsoft Dynamics CRM partner K3, CRM, changes within the broad manufacturing marketplace are serving to increase the demand for CRM.

“Industry 4.0, and the move to servitization, is having an undoubted impact right across manufacturing industry,” she argued.

“Customers are becoming more demanding and more proactive, and as servitization and aftermarket field service become more common, the number of customer touch points within the average business is increasing.

“There’s a clear opportunity for such manufacturers to build the same levels of customer loyalty that you see in the B2C world, through delivering superior service, and being more responsive—and this is exactly what CRM delivers.”