Investment in order management software is on the up.
Some reports predict the market will exceed $3bn by 2024; a CAGR of around 11%. And, yes, the booming e-commerce sector is fuelling much of the growth. But tech firms are scrabbling to invest too. Telecomms firms alone will reportedly invest an additional $1bn in order management software before 2022.
Are they right to?
On first glance, the answer seems obvious. Order management software comes with a slew of benefits. For tech firms, the reduced admin costs alone often make splashing out a wise financial decision. The reduced admin costs, however, are a small part of a much broader goal.
What tech firms are really chasing when they enlist order management software – and what’s really fuelling the sector’s growth – is a need to reduce the cost of doing business by reducing manual admin time for each sale, while at the same time providing a competitive service to customers combined with the benefits of automation.
Removing the business jargon, tech firms aren’t happy with the way they do things at the minute.
Bespoke quotes. Bespoke contracts. Physical paperwork. Spreadsheets.
Because tech and IT contracts are often complex, it’s typical for all of the above to feature in the sale of technology or software. Even when they don’t, you can bet spreadsheets crop up in the management of orders further down the line.
It’s costly. And, when you’re unable to answer simple questions from clients on the spot (how many licences are we using? How much spare capacity do we have?), it’s also somewhat embarrassing.
So, in response, tech firms are searching for alternative solutions. Order management seems to fit the bill. And, as is customary in the digital era, those responsible for the purchase fire up Google. They begin researching order management software. They start watching demos and making a shortlist. It’s possible – maybe even probable – they’re in too much of a hurry.
As well as order management software, should they, in fact, consider how CRM could provide a solution?
A better solution
We’re not disputing that order management software reduces operational costs. On the contrary, we believe it does. But modern CRMs (yes, Workbooks included), have order management software built-in – which has several advantages.
When prospects request quotes, they get them – instantly. When they accept, they get contracts – instantly. DocuSign allows customers to sign, again, instantly. When they sign, orders are processed automatically with no need for manual intervention.
There are no human mistakes that creep in. With order management software in perfect synergy with your CRM, it really is as simple as clicking the right buttons.
So while order management software reduces operational costs, CRMs with the same functionality can and do reduce operational costs even further.
Beyond cost reduction
The benefits of a CRM with order management functionality spill beyond reduced operational costs. Integration issues, for example, don’t exist. Frustrations frequently associated with introducing new technologies (such as encouraging uptake) are minimised. Renewals become automatic – there’s no danger of losing business simply through oversight.
When selling on capacity, it becomes easy to see who has used what without consulting multiple systems. Customer experience and success teams can identify those running close to capacity (as upsell opportunities) or below capacity (as at-risk customers).
Forecasting becomes easy. Payments – both incoming and outgoing – land on time.
In the tech sector, license costs can be divided into development costs and operational costs. When you reduce operational costs, you enjoy greater margins. It’s little wonder, then, that tech firms are investing in order management software to bring operational costs down.
However, the case for managing orders and accounts through CRM systems is easy to argue. Before investing in bespoke order management software, it’s worth stopping to think.
Does it make sense to consider a CRM with order management software built-in, too?
This blog post is part of a new whitepaper series exploring four ways IT and tech firms can increase the ROI of their CRM software. The second whitepaper, Streamline Your Orders, is available for free here.