Is open source CRM ready for prime time?

Open Source Customer Relationship Management (CRM) Executive Summary

Over the course of the last 24 months, open source CRM has hit the Software-as-a-Service (SaaS) online market with a large number of start-up software publishers vying for customer share. Open source CRM systems used or referenced by our survey participants included Anteil (www.anteil.com), BlueWhale (www.bluewhalecrm.com), CentraView (www.centraview.com), Compiere ERP & CRM (www.compiere.org), Daffodil (www.daffodildb.com), Hipergate (www.hipergate.org), OFBiz (Open For Business, www.ofbiz.org), Ohioedge (www.ohioedge.com), openCRM (www.opencrx.org), OpenSourceCRM (http://sourceforge.net/projects/opensourcecrm), Sugarcrm (www.sugarcrm.com) and vtiger (www.vtiger.com).

The net takeaway from the survey responses is that while most respondents believe open source CRM will have its day, current solutions are not ready for all except the small business early adopters and leading edge technology pioneers. There was a noticeable difference in responses by role. Open source CRM solutions were viewed more positively by network and technology positions, while sales and business management positions were far more skeptical, cautious and generally unwilling to accept increased risk for a decreased acquisition investment. The majority of respondents felt that open source solutions attempted to offer very broad CRM systems at the expense of CRM depth. While acquisition cost was the most cited open source CRM benefit, the primary deficiencies cited in the survey included the following:

• Lack on integration to MS Outlook and lack of integration tools in general.
• Lack of customization capabilities and tools.
• No intermediate functionality capabilities such as workflow automation, information analysis or wireless.
• Companies obtaining open source have for the most part simply shifted their budgets from software capital procurement to higher labor investments.

As expected, almost all of the mentioned Open Source CRM products operate on the LAMP stack. For reference, the first three letters in LAMP stand for Linux, Apache and MySQL, which comprise the OS, Web server and database. The P in LAMP is a matter of preference - it stands for either Perl, PHP or Python - although some would argue that other scripting languages, such as Ruby, should be included as well. While several (generally smaller) organizations believe open sourced CRM solutions must operate within LAMP, other midmarket or larger organizations commented that the LAMP foundation doesn't provide the scalability required above the small business market. This technology foundation may be why open source CRM is starting to see some acceptance among small and medium-sized businesses (SMBs), however, appears relatively absent in larger organizations.

In a bit of a twist, Wendy Close, research director with Stamford, Conn.-based Gartner Inc. indicated that while most open source CRM offerings are targeted at SMBs, they may be better suited to enterprises. Close commented "What's interesting is you can now find free lead tracking, contact, account and task management, executive dashboards, and customer services applications. The challenge is most small and midsized businesses don't have the resources to take on an open source CRM project." Most companies with less than 1,000 employees do not have the IT resources to develop open source CRM themselves, Close said. In fact, software is only 15% of the total cost of ownership over a five-year CRM project, she said.

"Open source is a great alternative to jump-start a custom-built application, but it still is not as functionally rich as a packaged application," said Sheryl Kingstone, CRM program manager at Boston-based Yankee Group. "When evaluating the total cost of ownership, be sure that you are fully comparing 'apples to apples,' including future upgradeability and time to stay on top of competitive differentiating technology."

Perhaps the greatest open source CRM caution came from an IT Director survey respondent who indicated "You cannot assure high levels of reliability from systems built exclusively by volunteers. I admire open source software as a means of innovation, however, not for delivering mission critical business systems. Software liabilities and patent infringements aside, without any responsible source of accountability, open source software has become the ultimate 'swim at your own risk' scenario."