As with anything, a brief introduction on what hosted CRM really is. It is an arrangement in which an organization out sources some of its customer relation functions to a vendor who provides application services. The focus on technology this way helps decrease costs and increase return on investment by allowing a company to focus on its core competencies. However in house CRM solutions allow for extensive customization, despite issues like high software and consulting costs, ineffective user adoption and poor management.
Here is a comparison of both systems based on some pertinent points.
Ownership
Many customers of hosted solutions claim that the ownership costs for a hosted system are far lower than an on-site system. With a hosted system, a monthly fee is paid for the period of use of the product. In addition there is the contractual obligation with a time stipulation. This means that when the product does not meet the specific business requirements, the company is forced to continue using the product to meet its obligation. This effectively means that fees are paid even the service is of no use. In an owned system, the software is owned by the company with a fee paid for the licensing rights at the time of the agreement.
However, one hidden fact about the hosted system is that often vendors offer the solution at a very low introductory price and companies fall all over themselves as they believe themselves to have obtained the best possible deal. This introductory solution however is extremely basic and in order to customize the solution further, the company has to incur the true hidden costs.
Costs
Often there are claims that the hosted solution is more cost effective than an on-site one. This is one of the biggest myths. One of the reasons that this claim could be partly right is because of the fact that most hosted solutions are extremely limited in functionality and offer no option for customization as per specific business requirements. This is why the costs could possibly be lower in a hosted system. After all, it makes sense if costs increase depending on the scale and extent of a company’s business activities whether the system be hosted or on-site.
Integration
Very often it makes good business sense to integrate all business data in the accounting, financial and ERP systems. This ability is available with both hosted and on-site systems. With on-site systems, vendors build the application such that integration is possible with the tools available in the package itself. However when a company function has to be synchronized with a third party hosted service, it means a lot of difficult logistics. In an onsite system however all the data is in the same place and it is a matter of accessing from one point while in the hosted system, it usually involves gathering from many sources and then assembling the data together where required.
eSpecial Softech is a niche CRM solutions company. They are a UK SugarCRM partner who with a team of a highly qualified professionals, excel in providing clients with the best CRM solution backed by exceptional service.
Their extensive experience with leading software vendors, the performing mindset and focus on state-of-the art technologies enables them to attract and retain world-class professionals who thrive on helping their clients succeed.
