CRM is more than software.
It’s when interactions with your customers are personalized.
It’s where your sales team sees leads that are most likely to convert.
It’s for precise targeting using audience segmentation.
I’m going to guide you through the correct CRM development process. We at SumatoSoft help our Clients navigate this journey when we offer our custom CRM software development services.
The article is written for businesses wanting to understand the steps or actions they can take to get a CRM that will drive their business.
What is a CRM System?
CRM stands for Customer Relationship Management, a set of practices and strategies businesses use to manage, analyze, and enhance customer interactions.
A CRM system, in turn, is software that facilitates the implementation of these strategies and practices.
I will refer to a CRM system as just CRM throughout the article to keep things simple.
CRM system’s key characteristics are:
- CRM centralizes customer data in one place (the software system);
- CRM makes customer interactions visible to stakeholders;
- CRM streamlines operations like sales management or customer service and support.
Benefits of CRM or What Businesses Get From It
There are numerous case studies with different measurements of the benefits a business gets after implementing a CRM. In reality, the exact numbers vary significantly depending on factors like the industry, business operations, the economic stage, and more.
Therefore, the exact numerical values from past CRM implementations don’t guarantee that your business will achieve the same results. So, consider the following figures as “I can expect these benefits with approximately such values.” rather than “I will increase the revenue by 200%.”
Types of CRM Systems
Technically speaking, there are 3 types of CRMs that differ in their functionality. However, this division is nominal since businesses usually use the functionality of all three types at once rather than a single one.
| Purpose | Key features | Examples | |
| Operational CRM | Enhance the efficiency of sales, marketing, and customer support | Sales automation Marketing automation Service automation | SalesforceHubSpot CRM |
| Analytical CRM | Gather and analyze customer data to gain insights into customer behavior, decisions, preferences, etc. | Data warehousing Data mining OLAP (Online Analytical Processing) | Zoho CRMSAP CRM |
| Collaborative CRM | Facilitates collaboration and communication among various departments and with customers | Interaction management Channel management Document management | Microsoft Dynamics 365Zendesk |
These CRM types are equal, there is no superior or basic CRM system.
The information provided is enough to give you an idea of CRM software. Now, let’s move to the core part: building a CRM.
How to Develop CRM: 3 Core Steps
The question “How to develop a CRM?” is a little broader than it might seem. Businesses need CRM to reach goals, scale operations, systemize processes, etc. The simple presence of a developed CRM itself doesn’t achieve these goals.
So the actual question here is:
How can my business benefit from a CRM solution rather than investing money into software that nobody will use?
The answer lies in three steps:
- CRM development planning
- CRM development
- CRM implementation
Let’s discuss the first.
Step #1: How to Plan CRM Development
| First step overview | |
| Core goal | Identify business needs and expected results from implementing CRM |
| Business engagement level | High engagement from all stakeholders |
| Required activities from the business | Identify a business goalSet up clear KPIsIdentify required CRM featuresChoose between off-the-shelf and custom CRM developmentCalculate ROI |
| Approximate timelines | 4-6 weeks |
The business itself could efficiently perform the first step, although professional help is available from development companies that offer services like web development consulting.
Planning starts with defining business goals.
“Develop a CRM” isn’t a goal, wh. At the same time, customers leave because my managers forget to send them information on time, so I decided to improve interactions with customers” is a goal. Clearly defined goals like enhanced customer service, increased sales, and more effective marketing campaigns allow developers to understand what kind of CRMs a business needs.
Set Up Clear KPIs
KPIs provide quantifiable measures to assess the CRM system’s performance and impact after the development and monitor its implementation progress.
Examples of common CRM KPIs are:
- Customer satisfaction – typically gathered through post-interaction surveys asking customers to rate their experience.
- Sales growth – the increase in sales in the relative and absolute values.
- Net Promoter Score (NPS) – a measurement of customer loyalty based on survey responses about the likelihood of recommending the company to others.
- Lead conversion rate – the percentage of leads that are converted into actual sales.
- Customer retention rate – the percentage of Clients that stay with a business over some period. It’s an indicator that measures the effectiveness of the process of building a long-term relationship with customers.
- Average resolution time – average time to resolve a customer issue.
- Revenue per customer – average revenue each customer generates over some period.
And much more.
All KPIs must be aligned with the business goal.
Examine Approximate Costs of CRM Features
We systemized knowledge of our CRM software development and analyzed the features that the top 5 off-the-shelf CRMs offer. Here is the comprehensive list of CRM features we’ve gotten, split into several categories:
- Core features – features that are required for any CRM to function properly.
- Standard features – although not as vital as core features, these features are present in almost every CRM.
- Optional features – different CRMs can benefit from optional features, but they are not obligatory.
- Niche features – specific features that are only useful for some business types.
- Advanced features – require great expertise to be developed and implemented.
Every feature has an assessment of development complexity, which is based on one core assumption:
Every development company has its own estimation process and hourly rates, so absolute costs are only valid for a specific company that provides these costs.
So, I provide absolute numbers from SumatoSoft as well as relative assessment in the range from 1 to 5.
Once another software development company estimates 3-5 functions from the list, you can use our relative assessment to scale the estimation to the rest of the features and get an approximate cost of their development.
| Core features | Complexity, from 1 to 5 | Estimated hours (all) | Module cost in $ |
|---|---|---|---|
| Contact management | 3 | 144 | $7,200 |
| Lead management | 3 | 162 | $8,100 |
| Reporting and analytics | 4 | 216 | $10,800 |
| Pipeline management | 3 | 180 | $9,000 |
| Calendar | 3 | 144 | $7,200 |
| Total | 846 | $42,300 |
| Standard features | Complexity, from 1 to 5 | Estimated hours (all) | Module cost in $ |
|---|---|---|---|
| Quote and order management | 4 | 198 | $9,900 |
| Workflow automation | 5 | 252 | $12,600 |
| Task and activity management | 3 | 180 | $9,000 |
| Role-based access control | 3 | 144 | $7,200 |
| Email integration | 3 | 144 | $7,200 |
| Social media integration | 1 | 72 | $3,600 |
| Customer segmentation | 3 | 144 | $7,200 |
| Campaign management | 4 | 216 | $10,800 |
| Integration with inner business systems | 5 | 270 | $13,500 |
| Total | 1620 | $81,000 |
| Optional features | Complexity, from 1 to 5 | Estimated hours (all) | Module cost in $ |
|---|---|---|---|
| Call center integration | 4 | 216 | $10,800 |
| Multilingual support | 3 | 144 | $7,200 |
| SMS integration | 2 | 108 | $5,400 |
| Billing and invoicing | 4 | 198 | $9,900 |
| Role-based access control | 3 | 144 | $7,200 |
| Live chat support | 3 | 180 | $9,000 |
| Survey and feedback management | 3 | 144 | $7,200 |
| Document management | 3 | 180 | $9,000 |
| Integration with project management tools | 3 | 180 | $9,000 |
| Total | 1494 | $74,700 |
| Niche features | Complexity, from 1 to 5 | Estimated hours (all) | Module cost in $ |
|---|---|---|---|
| Mobile access | 3 | 144 | $7,200 |
| Customer portal | 5 | 288 | $14,400 |
| Subscription management and recurring billing | 5 | 252 | $12,600 |
| Product and inventory management | 4 | 216 | $10,800 |
| SLA management | 3 | 180 | $9,000 |
| Knowledge base | 3 | 144 | $7,200 |
| Event management | 3 | 180 | $9,000 |
| Data import/export | 3 | 144 | $7,200 |
| API access | 4 | 216 | $10,800 |
| Multi-currency support | 3 | 144 | $7,200 |
| Total | 1908 | $95,400 |
| Advanced features | Complexity, from 1 to 5 | Estimated hours (all) | Module cost in $ |
|---|---|---|---|
| AI and machine learning capabilities | 5 | 216 | $10,800 |
| Voice recognition | 5 | 216 | $10,800 |
| Sales forecasting | 4 | 216 | $10,800 |
| Gamification | 4 | 144 | $7,200 |
| NLP for chat support | 5 | 216 | $10,800 |
| Landing page builder | 5 | 288 | $14,400 |
| Total | 1296 | $64,800 |
Here is a brief overview of the approximate final costs of CRM development. To get the exact estimation, feel free to contact us and get a free quote.
| Service type | Hours | Cost in $ |
|---|---|---|
| Discovery phase | 500 | $25,000 |
| MVP development | 3,312 | $165,600 |
| Standard CRM with a lot of features | 5,760 | $288,000 |
| Advanced CRM | 7,164 | $358,200 |
Identify the List of Features Your Business Needs
The previous lists with features are very detailed – few businesses will need all of them when introducing CRM. A business needs to run a needs assessment and prioritize features into mandatory, optional, and nice-to-have for their operations. The final result will serve as a solid foundation when speaking with the software development company.
Off-the-Shelf vs. Сustom Choice
This is an old battle without a clear winner. Both off-the-shelf and custom CRMs are tools that are supposed to serve business operations. If off-the-shelf software could do it, great! Check the available options by browsing comparison lists on Google, pick the one you find most suitable, and implement it in your operations.
From our experience, if you implement CRM in your business for the first time, it’s better to opt for off-the-shelf CRM.
A business needs a custom CRM when it has reasons why NOT an off-the-shelf CRM.
Still, here is a comparison list of off-the-shelf and custom CRMs’ distinguished characteristics.
| Off-the-shelf | Custom | |
| Cost | Low setup costs, then subscription or per-user fee | Significant upfront development costs, no fees over time |
| Implementation time | Quick deployment that takes several hours or days | A long development process that could take up to a year |
| Scalability | Predefined scalability based on pricing tiers | Easily scalable |
| Flexibility in features | A limited number of features that depend on the pricing tier | The number of features fully matches and is tailored to business needs |
| Integration with other systems | Supports popular integrations, provides API for integration | Seamless integration with any system, custom APIs |
| User interfaces | Generalized interfaces with little customization | Unique tailored UI to specific business processes and users |
| Ongoing system maintenance | Performed by a vendor | Require a technical specialist for maintenance |
| Support and knowledge base | The vendor maintains a knowledge base; there are multiple questions on the forums | Custom support, often requires an in-house team |
| Upgrades | Regular updates from the vendor | Custom updates as needed |
| Security | Depends on the vendor. Usually, highly secure | Depends on business requirements. Always highly secure |
| Training and onboarding | Vendor-provided materials | Custom training programs |
| Data storage | Vendor-owned and managed cloud storage | On-premise or cloud solution, owned by a business |
Top Off-the-Shelf CRM Software Options
Multiple comparison articles and websites are devoted to this issue. My goal here is to briefly introduce market leaders and our preferences.
First, let’s focus on official leaders in the market. Here is the chart from Statista of the leading CRM vendors based on their revenue share:
Here are a few awesome CRMs that are popular but don’t have the same gigantic revenue flow:
- HubSpot (our personal choice)
- Zendeck
- Insightly
- Pipedrive
- SugarCRM
All CRMs differ in price and opportunities. So check it before committing to anything. In case you want to know more about how to choose the proper CRM, we have a comprehensive article on this topic: How to Choose CRM Software For Your Business.
Calculate Return on Investment
The final part of the preparatory step is ROI calculation. The ROI formula is simple, but the actual calculation is much more complicated than it seems:
General rules for correct calculation:
- The net return includes both tangible and intangible benefits. Intangible benefits comprise improved customer satisfaction, enhanced collaboration, brand reputation, employee satisfaction, etc. It’s necessary to assign a monetary value to each intangible benefit.
- Identify and include all costs: subscription fees, hardware costs, implementation, training, and maintenance costs.
- Adjust the expected benefits considering potential resistance or incomplete user adoption of a new CRM.
ROI allows to determine the financial return of the investment in the CRM. It’s a great metric.
Results of the first step:
- defined business goals;
- determined measurable KPIs;
- calculated approximate costs of necessary CRM features;
- calculated return on investment.
Step #2: How to Build a CRM System From Scratch
| Second step overview | |
| Core goal | Find a software development partner and develop a CRM |
| Business engagement level | Moderate |
| Required activities from the business | Find a reliable software development providerActively participate in the discovery phaseAttend demos and status meetingsConduct regular reviews of the interim progress and provide feedback |
| Approximate timelines | 3-12 months |
This step is only relevant for businesses that opt for custom CRM rather than off-the-shelf.
CRM application development is performed by a software development team that can consist of several specialists or dozens of specialists – all depending on the budget, business goals, project complexity, and timelines.
An average development team includes 5 specialists: a business analyst, a designer, a project manager, a software engineer, and a QA specialist. An actual team is gathered after the requirements analysis and might involve additional roles such as DevOps, software architect, and more. Read our article “How to structure your software development team” to know more about it.
Speaking about CRM development, the corresponding question arises: “How and where to find reliable software developers that will manage to deliver the expected results?”
How to Choose a Software Development Company
Step 1: Define business goals, priorities, budget, and timeline. I expect you’ve already done it in the previous step.
Step 2: Identify and describe the requirements and qualifications you are looking for. These comprise skills, the number of years of experience, industry expertise, experience with specific platforms or legislation, certifications, and similar cases.
An Example of Requirements and Qualifications for a Software Development Company
A software development company with 10+ years in full-stack web development, specializing in fintech solutions and having experience in dealing with regulatory compliance (GDPR, PCI-DSS). Expertise in Salesforce, ERP systems, AWS, Azure, and DevOps is mandatory. Expected certifications are AWS Solutions Architect and ISO 27001. Proven success in fintech projects and strong client references are required.
Step 3: Research Google, rating platforms like Clutch, Goodfirms, Techreviewer, and write a list of software development companies that meet your defined criteria.
Step 4: Narrow down your list by reviewing each company’s portfolio, Client feedback and reputation to focus on those that best fit your project requirements.
Step 5: Reach out to the selected companies to discuss your project details, gather information and request a quote or proposal.
Step 6: Evaluate each company’s proposal based on factors like expertise, communication skills, pricing and contract terms and choose the software development partner for your project.
We have prepared an in-depth whitepaper on this subject. Feel free to check it: 6 stops on the way to the right Software Development Company.
Once the software development provider is chosen, the software development lifecycle starts.
From this point, much of the success in development is defined by the expertise and responsibility of the development team. Still, I want to focus on areas where the business can influence the lifecycle and the final results.
But first, let me introduce the general development process that every developer adheres to.
CRM Software Development Lifecycle
This section is the most direct and straightforward answer to the question “How to build a CRM from scratch?”
Software development lifecycle, or SDLC for short, is a standard process of software development. It includes several core steps:
- Requirement analysis – also called a Discovery Phase. During this phase, developers identify the scope of work, prepare precise budget and timeframe estimation, draw a comprehensive shared vision of the project, hold a feasibility analysis, and run risk assessment.
- Design – also called UI/UX design phase or prototyping and wireframing. Designers develop user interfaces (UI) for mobile and web, draw the design concept and UI elements, prepare a brand book, make several prototypes, and more. This step is about the visual appearance of the CRM solution.
- Development is about writing the actual code, both backend and frontend, using programming languages. Business owners usually see only the frontend part and stay unaware of the quality of the backend part.
- Testing – this step involves various types of testing, such as unit testing, integration testing, security, usability, integration, and more.
- Deployment – this step is about making the CRM available for final users. It involves activities such as setting up servers, configuring networks, enabling system monitoring, data migration, final CRM configuration, performance optimization, and more.
Every SDLC step is worth a separate article; our developers and manager have written them:
- software development lifecycle;
- a guide to the Discovery Phase;
- design tips that boost user experience;
- the role of software testing lifecycle.
How Businesses Can Ensure the Success of the Development Efforts
We systematically analyze the results of every project, assessing the challenges we face and how we overcame them and devising methods to avoid them in the future. We have identified a recurring set of challenges, often stemming from the business rather than some technical issues.
Below are key recommendations to businesses on how to help software developers deliver a top-notch CRM system:
#1 Comprehensive Discovery Phase and Risk Management
Ignoring the discovery phase and risk management results in unforeseen requirements changes, vague priorities, budget overruns, and unmet deadlines. The discovery phase is performed once at the beginning of the CRM development lifecycle and requires full business attention. This is literally the only phase where businesses are active participants rather than overseers.
#2 Examine Artifacts the Developers Provide
The SDLC implies that the developers deliver several artifacts that will shape the future CRM solution, allowing businesses to grasp the concept of how CRM will operate. These artifacts are:
- user roles and main user scenarios;
- information architecture;
- software architecture diagrams;
- CRM design, mockups, prototypes;
- risk classification and mitigation strategies.
By reviewing these artifacts, businesses can identify issues or inconsistencies early on before the development actually starts.
For example, by reviewing user roles and scenarios, businesses may identify that sales specialists require quick access to customer deal history because they often answer questions about it. Alternatively, businesses might recognize the need for an additional checkpoint for top managers when deals are moved to the production sector.
#3 Continuous CRM Evaluation through Demos
Conduct regular reviews after each demo of the work done rather than waiting till the end of the project to evaluate the entire system. Ask questions in case of any inconsistencies, and critically evaluate the design, interfaces, and functionality when checking it.
Early feedback allows the development team to quickly address any issues.
#4 Participate in Demos and Status Check
Professional software developers adhere to the best management practices, two of which are conducting regular demos and status checks. These activities serve as checkpoints where businesses can access the interim progress and provide feedback. Regular participation in such events ensures the project stays on track and meets its objectives.
That’s all about the second step. Let’s move on to the last one.
Results of the second step:
- there is a reliable technological partner;
- the CRM is developed.
Step #3: How to Implement CRM
| Third step overview | |
| Core goal | Implement the software and ensure a high adoption rate |
| Business engagement level | Moderate |
| Required activities | Develop an implementation strategyBuild the implementation teamOrganize training for employees |
| Approximate timelines | 3-6 months |
CRM development isn’t finished at the previous step. After development and deployment, the software must be implemented. Businesses shouldn’t wait till the end of the development process to start the implementation phase. It’s a good practice to think over the implementation process beforehand and start making the right moves toward successful implementation along with the second step.
Start With an Implementation Strategy
An implementation strategy is a roadmap for introducing new software or deploying software updates. It describes a series of coordinated steps required to prepare the business processes and the team for the successful adoption of new software.
An implementation strategy continues previous efforts when a business defines goals, KPIs, ROI, engages stakeholders, assesses risks, etc., and extends it with additional activities:
| Activity | Why it matters | Positive effect |
| Identify and optimize business processes that will be affected by new software | Unoptimized processes | Helps to avoid chaos during the CRM implementation |
| Build the implementation team | The implementation team will guide colleagues through the adoption and ensure that the CRM aligns with business needs | The team will include representatives from every key department who will use CRM. They will guide the adoption and help to achieve positive effects in their departments |
| Prepare the rollout schedule | A rollout schedule is a timeline that helps to move progressively toward complete adoption and not to get stuck. | It allows tracking the adoption rate and making timely adjustments in the implementation plan. |
| Develop a data migration strategy | A data migration plan ensures the information will be transferred without data loss. | Accurate and complete data in a new CRM. |
| Build training and engagement strategy | The cornerstone of successful implementation is employee engagement. | Training greatly facilitates CRM adoption. |
| Develop a change management strategy | Change management techniques allow to overcome the employee’s resistance to change, address concerns, and promote adoption. | Quicker CRM adoption. |
| Write comprehensive documentation | User guides, manuals, technical specifications, videos, and webinars get users familiar with the system’s features. | Users will likely achieve full CRM potential with more information about it. |
| Plan post-implementation support | Usage and technical issues are inevitable, so the specially allocated team will be able to address them. | Users will focus on using CRM features rather than solving usage and technical issues. |
An implementation plan is a necessary roadmap that will ensure CRM unlocks its potential and users embrace the new system.
Still, there are 3 more aspects you will need to cover.
#1: Communicate Early and Often
Encourage early feedback from representatives from core departments that will use CRM. When software developers run demos, invite representatives to participate.
Provide representatives access to the test CRM environment, keep them updated on the recently released features, and foster an environment where they will feel comfortable providing feedback and asking questions.
Establish mechanisms for collecting and incorporating stakeholder feedback throughout the development and implementation process.
#2: Use Effective Strategies for Data Migration
The implementation process becomes more challenging when dealing with migrating a large volume of data. Poorly handled data migration could significantly affect user adoption rate and overall user experience, so I want to pay some extra attention to this issue.
There are 6 steps on how to handle migration properly:
- examine your data and its sources;
- map old and new data fields;
- clean and prepare the data;
- backup the data in the new CRM, if any;
- transfer the data in chunks or during one session;
- develop test cases to validate data migration.
Explanation of Data Migration Process:
The whole process of data migration is mostly about matching items in several spreadsheets.
It starts with understanding the existing data. You need to draw a spreadsheet like this:
| Data source | Description | Data format | Volume | Update frequency | Data owner | Data quality assessment |
| Marketing CRM | Database with customer information | XML | 10,000 records | Daily | Sales department | High – data regularly cleansed |
The next spreadsheet is about matching old fields with the fields in a new CRM.
| Old system field | Description | Data source | Data type | New CRM field |
| FirstName | First name of the customer | Marketing CRM | string | First_Name |
Then, the data must be prepared, which includes eliminating duplicate records, removing outdated information, and ensuring consistency in formats across different datasets.
Ensure that a secure copy of the data in the new CRM exists in case of unforeseen issues or failures during migration.
At this point, the data is ready for transfer. The transfer process could be done incrementally or entirely – the first option is preferable when the CRM is already in use.
Finally, validate the transferred data inside the new CRM: verify the presence of all records and verify the new fields get the correct data.
#3: Train Employees
The cornerstone of successful implementation is employee engagement. They should be aware of how the new software works and how it facilitates their work optimization.
So, provide various types of training: joint seminars, collaborative training, hands-on workshops, real-life scenarios, role-playing exercises, coaching, self-education materials, inbuild training lectures and courses, etc.
The more users understand the new CRM system, the more effectively they will use it and the more benefits businesses will gain from it.
To know more secrets of successful implementation, read our article about secrets of successful software implementation.
Results of the third step:
- employees use CRM in their daily operations.
CRM Development with SumatoSoft
SumatoSoft is a software development service provider that has become a technological partner to its Clients across 27 countries. Our portfolio includes over 250 successful projects in various industries, such as eCommerce app development, Elearning software, Finance, Real Estate, Logistics software development, Travel, and more.
Facts about SumatoSoft:
- We strive for quality and security, and ISO 27001 and ISO 9001 certificates can prove it.
- We focus on long-term cooperation. 70% of our Clients come back to us with another project.
- Our Client’s satisfaction rate is 98%, thanks to our firm commitment to deadlines and their needs.
- Your project data stays safe. We guarantee the security of all data related to your project.
Get in touch with us, and we’ll provide a free quote for your CRM project.
Sum Up
CRM stands for customer relationship management, while CRM systems are software that facilitate this management. People often omit the “system” word and refer to such software as a simple “CRM”.
There are 3 steps that every business should pass when considering the opportunity on how to create CRM:
- Step #1: plan CRM development before even referring to the software development providers;
- Step #2: find a software development company and develop a CRM in close cooperation with them;
- Step #3: Implement a newly developed CRM.
All these steps aren’t rocket science – with the right knowledge and the intention to build a great product, you can build your own CRM that will drive business growth and improve customer satisfaction.
Let’s start
If you have any questions, email us info@sumatosoft.com
