Businesses both large and small are regularly presented with an array of IT 'solutions' with unfathomable acronyms that promise tempting sales and productivity boosts. But what do terms such as enterprise resource planning (ERP), Business Intelligence (BI), Customer Relationship Management (CRM), and Sales Intelligence (SI) actually mean? Where did it all start and what relevance do they have for industrial manufacturing and distribution companies.

Before CRM was even dreamt of, there was something called Enterprise Resource Planning (ERP).

This acronym can be traced back to the 1960s and early methods of inventory control, but was later understood as the business strategy that promised to automate the 'back-office', provide financial reporting and control the supply chain.

It was in the early 1990s, when companies first started to build extensive ERP systems to automate and organise their data; that is also when business intelligence (BI) first emerged.

BI is a general term used to refer to the various ways in which a company analyses data, for example financial, operational or sales information, and the increased availability of company data was perceived as a boon for this process.

The initial problem with BI was, however, that as the new systems collected more and more information, it became impossible to extract what was relevant quickly and efficiently and deliver it to employees who needed it the most, rendering the massive amounts of data virtually useless.

Increasingly sophisticated tools and the advent of data warehousing have gone some way towards bridging this gap between available and useful data, but the process can still be complex and expensive.

Meanwhile, this trend towards harnessing and using key data had spread to the 'front office', and heralded the arrival of customer relationship management (CRM) in the mid-1990s.

In the early years, CRM simply referred to the software used to help businesses manage their customer information, predominantly sales force automation software (SFA) that focused on customer contact management.

It is estimated that the global market for CRM services and solutions is now worth 4.8 billion US Dollars, which gives some indication as to how far the market has developed since those early days.

Now businesses can choose from a wide array of CRM 'solutions' ranging from web-based systems aimed at small companies to sophisticated knowledge management solutions suitable for multi-national enterprises with millions of customers.

So where does CRM and related technologies fit with industrial manufacturing and distribution companies?

Traditionally, industry has been at the forefront of technology, but often in terms of front office software it has been a little slow in adapting to new technology, mainly because the implementation of a new software system has traditionally required a disproportionate amount of time and caused a similarly large amount of disruption.

There are also unique challenges faced by large scale manufacturers and distributors in that the sheer size of the average product range and inventory means there is a huge amount of data to handle and there will inevitably be legacy systems to deal with.

The need to win market share in a climate of increasing consolidation also means that they cannot afford to rush into a software purchase without being certain it is tailored to their needs.

In any industry, the key to making a decision about buying software is to be sure you understand what business problem it is actually a 'solution' for.

This may seem obvious but it's surprising just how few businesses actually take the time to do this and end up buying software that is too expensive, too onerous to fully implement and that the company rarely uses to anything near it's potential.

If the primary objective of a CRM system is to support the sales and administration teams, then why could it not be pro-active in actually identifying sales opportunities and alerting users to when customers started to drift away?

This is where Sales Intelligence (SI) was born, Vecta, one of the leading UK providers of SI solutions for example developed and implemented its first products during the late 90's.

Traditional CRM passively supports conventional sales techniques, often designed to drive 'new customer acquisition', but providing little in the way of delivering insight into the buying patterns of the all important existing customer base and so is unable to drive the sales effort.

It is designed to help salespeople record soft customer information, but it is much less effective for identifying new customers or retaining and selling more to existing ones.

A good Sales Intelligence system however will include advanced CRM style contact management functionality but will also extract the critical operational information it needs from existing back-office and accounting systems, which means there is no need to invest in an expensive CRM or BI solution.

It also avoids the long implementation period of traditional BI solutions that have to be built-to-order often by the user, and avoids the typical data 'overload' caused by the BI system when it is up and running.

Sales Intelligence is designed specifically around this premise that successful sales depend on identifying the right opportunities at the right time.

All the information needed to find new sales opportunities and identify customer issues is somewhere within your company's databases, and Sales Intelligence software simply automates the extraction of this knowledge and delivers it to the sales team.

Provided by vendors such as Vecta, it works by monitoring and analysing the buying patterns of customers by drawing data from existing accounts and enterprise software.

Irregularities and other trends in customer spending will trigger alerts that translate into sales leads delivered straight to the relevant sales representatives.

If, on the other hand, you need in-depth information to review and analyse business processes, then you may wish to purchase a full BI system.

Buyer beware, however, traditional BI solutions are seldom straightforward and users often have to build and implement systems themselves.

Similarly with CRM systems, salespeople are usually required to input data before they get useful information back, so end user adoption is far from guaranteed.

Put simply, all of these technologies are concerned with information management and, equally importantly, the every day use of that information.

Before considering any technology investment, it is vital that distributors identify the exact business requirement the promised information will meet.

Once this is established, they must not shy away from asking robust questions of all suppliers and mapping them against clearly deliverable business objectives.