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CRM Systems Growing, Moving to the Cloud

The tipping point for customer relationship management (CRM) systems is nearing, according to new research from Gartner (News - Alert). As these systems continue to grow, the firm predicts that less and less of these systems will be on-premises. More and more CRM systems will be making the move to the cloud, as it provides a more flexible, reliable, and cost-effective solution when compared to on-site systems, and does not require the constant maintenance that older systems do today.

Gartner predicts that this transition will occur fairly rapidly: by next year, they say there will be more cloud-based CRM systems than those on premises. The ratio is expected to increase to 85/15 within the next decade.

CRM systems are a necessity for businesses, says Gartner vice president of research Joanne Correia, “CRM will be at the heart of digital initiatives in coming years.” As organizations look to technology for more solutions, she says, “This is one technology area that will get funding because digital business is critical for companies to remain competitive.”

One of the practices at the forefront of the CRM expansion is increased delivery of software as a service (SaaS (News - Alert)); according to Gartner, SaaS made up over 40 percent of total CRM software revenue. More and more organizations are looking towards SaaS, says Gartner, as they look for “easier-to-deploy alternatives to replace legacy systems”

Forrester Research (News - Alert) found that SaaS is a growing practice, with 18 percent of organizations in the United States currently using SaaS-based CRM alongside their legacy CRM systems, and 1 percent have already begun to phase out a majority of their legacy systems. “The advent of Saas application adoption has the potential to produce dramatic benefits for businesses across industries,” the research firm reports, including “ease and flexibility of access to the information needed for productivity.” Many organizations are looking to services to help their CRM systems grow and migrate to the cloud, businesses can continue to capitalize on increased flexibility and access to valuable data, and consumers will enjoy enhanced relationships with their service providers. 

Edited by Maurice Nagle