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Why You May Want to Outsource CRM Development — and How to Do It Effectively

31.01.2022 Darya Tryfanava
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Why You May Want to Outsource CRM Development — and How to Do It Effectively

As businesses scale and new customers emerge, business owners look for a flexible solution to manage their growing volume of data. This is where custom CRM systems bring significant benefits to any service-based business, from e-commerce to healthcare to logistics.

If you’re reading this, you may have been thinking about developing a custom CRM system. Defining goals, assembling an in-house or external software development team, terms of reference, sketching out a roadmap—all of these things can seem very complicated at first.

In this article, we explain why outsourcing CRM development is preferable to using an off-the-shelf solution. We’ll also discuss whether it’s better to hire your team or contract with an outsourcing company.

What is a CRM system?

A Customer Relationship Management (CRM) system is software for monitoring and recording interactions with customers. Its main purpose is to attract new customers and to optimize work processes within the company. CRM software processes data from different sources, including website analytics, call history, email services, and social media analytics tools. It is primarily used by sales managers, marketers, support teams, and brand analysts.

Why You Might Want to Outsource CRM Development

Below, we outline the clear signs that you need custom CRM development:

  • You need specific integrations. Off-the-shelf CRM software integrates with some widely used networking and email platforms, but there’s no guarantee that you will also be able to handle your internal databases or custom online call systems through it. The more out-of-the-box tools your team uses, the more challenging it is to find a CRM solution.
  • You don’t want to waste time and money on features you don’t need. Vendors who provide ready-made CRM software usually offer up to 4 packages at a time.  They target different businesses, categorizing them primarily by size, or rarely by field of business. That’s why providers add multiple features to each of their products, and why you’ll find yourself  overpaying and losing work time searching for fields and buttons if you only need one of them.
  • You require an identity. Ready-made CRM software is a template, so you can’t customize its UX and UI design. Likewise, you may experience issues with using some CRM options if the UX is designed for the convenience of the majority, but it’s not for every user. Communication with your customers may also become a bit standardized, since your competitors may use ready-made CRM programs with the same features, algorithms, and design.

Choosing Between Ready-Made and Custom CRM Development

With no strict existing classification, CRM solutions are mainly divided into turnkey and custom solutions according to their level of functionality.

Turnkey solutions are standardized products with limited functionality and little to no customization. They are designed to meet the demands of the majority of enterprises and do not allow tailoring a CRM to the logic of a particular company’s business processes.

Custom CRM software is a product designed with the peculiar features and specifics of a particular business in mind. Such systems are preferred by companies whose internal processes have fairly complex logic.

In the table below, we list the differences between turnkey and custom CRMs.

CRM Software: Ready-Made vs. Custom
Ready-Made Solutions Custom Software Development
Mode of operation Application of a general scheme, without taking into account the company’s specific requirements Designed with your business in mind and working accordingly
UI convenience A number of additional functions complicate interaction with the system Only the features you need, which helps save time and money on staff training
Integration with other services Certain limitations on integration with third-party services Provides integration with other systems, including messengers, IP-telephony, 1C, document management applications, and others
Adding users You have to pay for every additional user in the system You can add an unlimited number of users. If you boost your business, you won’t have to pay for additional employees.
Cost Monthly fees No monthly fees, as your company owns the system completely 
Ease of use Some tools are quite difficult to master without special training. Using the software is intuitive and convenient for employees. Additional training is provided before implementation.
Customization The set of implemented features cannot be changed or modified. The feature set can be modified or expanded with the help of the software development company or your in-house specialists.

In a nutshell, ready-made CRM solutions offer a wide set of features, have low maintenance costs, and provide a quick startup. These are likely the most significant advantages of this option.

But beware: although the monthly fee for off-the-shelf CRM may seem small, the total cost of customizing solutions and adding new users is often quite high, and you can’t completely customize an entire solution to your specific requirements.

When you develop a custom CRM, you only get the features you need. You pay once for the product, and you can use it without restrictions. It can be modified or changed at any time, so custom CRM software development will still fit your needs when your company grows when you need to scale up, or when you require a system to monitor employee performance.

Outsourcing CRM Development vs. In-Door CRM: How to Choose a Contractor

It’s worth noting that there are two main ways to recruit IT specialists: hiring an in-house team or contracting with an outsourcing company.

In-House Team

If you have a technical director and a narrowly focused development team, you can choose this option. But keep in mind that all processes must be perfectly planned, all tasks should be evaluated, and engineers should have CRM development experience if you want services to be delivered on time. If you do not have enough developers, software architects, or quality assurance engineers, it’s likely better to outsource your project or hire a dedicated team.

Outsourced CRM Development

CRM development is a rather massive project. It requires a team that will provide a full-cycle, custom CRM system development from scratch to launch. Outsourcing to a software company can streamline and control the process. In this case, the work can be done quickly because a whole team of developers will be dispatched to work on your project. The outsourcing company will provide official contracts, time-sheets, and consulting.

But when the time comes, other questions arise: should you choose an entire team or one freelance software engineer? Next, you should figure out what type of outsourced mobile application development team you need. Should you go for an onshore, nearshore, or offshore team?

Also, what should you pay attention to before choosing a development team? First, you should look at the company’s portfolio, case studies, and products. It’s a bonus if a prospective outsourcing company has developed CRM systems related to your idea.

Outsourced CRM Development In-House Team
Pros The company is in the process of implementation, which saves you time 

No need to hire new employees

Access to an exclusive talent pool

More technology to choose from

Easy to find a suitable team

Faster project delivery

Cost-effective

Scalability

A deeper understanding of your business

Opportunity to develop your employees

Face-to-face communication

Complete control 

Faster start-up 

Quicker changes

Cultural fit

Cons Vendor may not know your business as well as you do 

Limited control of the process 

Delays in communication may occur

Security risks

Communication gap

Responsibility for team building

Responsibility for project management

Lack of technical talent

Time-consuming 

Staff turnover

High cost

Both in-house and outsourced CRM development options are effective. The one you should choose depends on what is better for your specific business requirements.

If your company has the resources to hire the necessary specialists and manage the entire process in-house, it’s likely best to choose in-house development.

If you do not have enough resources or experience in developing CRM systems, and you do not mind working with a third party, we recommend that you opt for outsourcing.

Benefits and Drawbacks of CRM Development Outsourcing

Benefits of CRM Development Outsourcing

Now let’s discuss the key benefits of custom CRM software.

  • You are not bound to one vendor. Your CRM developer will work with you to create a solution that meets your requirements. You will be able to choose from a variety of service providers and discover exactly who you need for your project, whether that’s  the specialist with the most experience in the field or the one with the most affordable price, etc.
  • Customer insights analytics. The biggest problem companies experience when they don’t use CRM is loss of leads. Leads often drop out of the sales funnel due to inconsistent follow-ups from the marketing and sales teams.
  • Workflow automation. A custom CRM system can help you automate marketing, analytics, sales, and customer support tasks and save you money. Note that specific types of automation are not always possible with ready-made solutions.
  • Time and money savings. You can reduce business expenses as you only pay for the amount of work you need. Outsourcing eliminates employee training costs and reduces administrative costs related to personnel.
  • Cost-efficiency. Off-the-shelf CRMs are usually provided on a subscription basis. Custom systems are more expensive initially, but the price difference is quickly gained back and are more efficient in the long run.
  • High performance. Custom CRM development is a great option to ensure the right level of performance to help you achieve your goals efficiently and avoid any limitations. You can choose your preferred technology stack, infrastructure, and other aspects that will help keep your custom-built CRM convenient, relevant, and high-performance.
  • Focus on the core business. Outsourcing allows you to focus on your company’s core business.
  • High level of expertise. Outsourcing development companies are responsible for the performance of work according to the agreement.
  • Integration and synchronization. In a CRM system developed from scratch, everything is designed to integrate with the processes and systems that you already have.
  • Robust security. Verizon’s 2020 Data Breach Investigation Report shows that more than 45% of companies experienced hacking attacks, including 17% malware and 22% phishing attacks. These statistics demonstrate the possible risks you may face when purchasing off-the-shelf CRM products. For these reasons, custom CRM development is the right choice to minimize cybersecurity risks and keep your personal and corporate data safe. You’ll be able to build robust protection using the best encryption protocols and the latest cybersecurity trends.
  • Compatibility. In addition to essential CRM tools, you can also connect third-party resources. For example, you can integrate with telephony, messaging services, accounting software, email, etc.
  • Reliability. CRM systems will store all your important data: customer databases, transactions, reports, staff productivity, etc. Consequently, the system should be designed to protect them from third-party interference. CRM systems also usually have specific access levels for different groups of employees.
  • Centralized data gathering. Custom-built CRM software provides you with full digital control over everything that happens within your company. In addition, it allows you to work with databases in a format preferred by the company.
  • Scalable ecosystem. A CRM system includes a combination of stand-alone applications to make things easier for employees in specific departments. With a custom CRM solution, you can develop components of the system in small sessions, then scale and modify them whenever you want.

Potential Risks of CRM Development Outsourcing

Despite all its advantages, CRM development outsourcing still has some limitations.

  • Cost Issues. The cost of specialized software development services can be relatively high. Thus, you should determine the value you expect and compare it with the probable cost of developing a CRM system.
  • Poor planning. If you make mistakes during the idea stage, you may end up with a product that won’t meet your needs in the long run. In this case, you need to carefully map out your workflows and work with the developer to think about which features will be valuable to you.
  • Time constraints. You should consider the time necessary for planning, testing, bug fixes, data migration, installation, configuration, and staff training.
  • Communication barriers. If you choose foreign specialists at a lower price, you may encounter communication and language difficulties.
  • Employee turnover. Some IT companies have a fairly high turnover rate. This may not be an option for you. It is better to clarify this issue in advance, when the project is still in the discussion phase.

Ready to Build Your Own Custom CRM?

If you have questions about whether we can provide the CRM services you need, contact our team for more information. We’d be glad to share our expertise and help your company build a unique CRM that’s perfectly suited to your business.

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