SRM vs CRM software: What's the difference?
Customer Relationship Management (CRM) software and Stakeholder Relationship Management (SRM) software are both used to manage the interactions between a company and the people who have the potential to affect the organization’s outcomes. Some companies attempt to customize their CRM for managing stakeholder engagement activities.
In reality, SRM and CRM software are not interchangeable; they serve very different objectives. But what’s the difference between SRM and CRM systems… and which one is right for you?
Customers vs. Stakeholders
Before comparing SRM and CRM software, it’s important to recognize that customer and stakeholder relationships are very different.
Customers are the people and organizations that buy goods or services from a company. The company doesn’t usually need to interact with customers until it’s time to make a sale.
Stakeholders are far more numerous and diverse than customers. They include any individual, group, or organization that can affect – or be affected by – a company, its projects, or its activities. This includes customers, but also employees, suppliers, investors, and others.
Stakeholders have the potential to speed up, slow down, or even obstruct a project. They can also be extremely helpful advocates, sponsors, and agents of change. For that reason, companies need to build constructive, mutually beneficial relationships with their stakeholders.
- Politicians and Elected Officials from municipal, state/provincial, and federal governments
- NGOs (local, national, and international)
- Environmental groups
- Investors, lenders, and other financial partners
- Local residents, businesses, and community groups
- Religious groups and leaders
- Indigenous communities and leaders
- Regulatory authorities
- Media outlets
- Suppliers, contractors, and subcontractors
- Employees and labor unions
- Corporate management
Similar goal: to purchase a product or service at a reasonable pric
What is SRM software?
SRM, or Stakeholder Relationship Management software – sometimes called a stakeholder management system – is a tool that helps companies manage all information related to their stakeholder engagement efforts over the life of a project. It is designed to help companies manage stakeholder relationships and monitor how these change over time as they work to secure project social acceptance.
Stakeholder relationships are usually more complex and less predictable than customer relationships. SRM software is designed to consider these factors while promoting transparency and open communication.
Primary uses for SRM software
SRM software is used to helps teams:
- Identify stakeholders and analyze their levels of interest & influence in the project.
- Define engagement strategies and objectives.
- Plan and monitor engagement activities.
- Create tasks and assign due dates to keep projects on track.
- Quickly recognize and assess potential risks and opportunities.
- Quickly recognize and assess potential risks and opportunities.
- Engage personally and meaningfully with people, using their preferred method of communication.
- Document communications and interactions in a lasting corporate memory.
- Monitor how relationships evolve.
- Ensure compliance with regulations and other obligations.
- Measure outcomes and refine strategies as needed.
Who Uses SRM Software and why?
A wide range of industries use SRM software to manage stakeholder relationships, including:
- Public Utilities – To build mutually beneficial relationships and trust with stakeholders, public utilities must gain insights by seeking feedback from consumers, governments, interest groups and regulated entities.
- Oil and Gas – To implement effective long and short-term project planning, the oil and gas industry must engage with stakeholders early, especially when dealing with host communities, government, and financial institutions.
- Coal and mineral mining – To avoid the potential of millions of dollars per day in delays, lack of permitting, or closure, the coal and mining industry must build social acceptance and trust with communities, environmental regulators, and environmental activist organizations early in the planning process.
- Onshore and offshore renewable energy – To prevent delays and challenges impacting their success and longevity, renewable energy projects should engage communities, environmental regulators, and environmental activist organizations early in their planning process.
- Transportation – Obtaining social support and effectively engaging consumers, service and infrastructure providers, manufacturers, regulatory agencies, and communities early on will make projects more successful in the long- term.
- Healthcare – To allow informed and facilitated medical choices requires that patients, providers (professionals and institutions), payors, and policymakers have the information they need to make real-world healthcare decisions.
- Food production – To address environmental concerns and employee welfare, the food industry engages with an extensive list of stakeholders that range from consumers and community groups to producers and manufacturers.
- Retail and manufacturing – To be seen as good corporate citizens and gain a competitive advantage addressing environmental and economic concerns and maintaining transparency is crucial with investors, employees, customers, suppliers, communities, governments, or trade association stakeholders.
- Infrastructure (construction and maintenance) – To achieve win-win outcomes, engagement processes with clients, design teams, contractors, government, private companies, and project team members are vital for informed decision-making.
- Government –To avoid social and political instability while enabling effective communication around complex issues engaging with residents, businesses, employees, other departments, officials, employees, contractors, and regulators engaging stakeholders is necessary to move policies and laws forward.
- Charities and NGOs – To maintain a long-term sustainable charity or NGO, communication with employees, members, volunteers, board members, donors, foundations, vendors, sponsors, and other organizations is crucial to their cause and activities.
- Construction and engineering – To ensure the success of projects, building solid relationships and treating clients, project managers, teams and sponsors, technical and financial providers, consultants, suppliers, site personnel, and end users like partners will help establish trust.
- Forestry – To fully understand and communicate the benefits and risks associated with forestry projects, communication and partnerships with local communities, indigenous peoples, industries, governments, agencies, academia, civil society organizations, and NGOs will help design business and community-friendly projects.
- Higher education institutions – To effectively communicate the contributions higher education institutions make to the welfare of economic and social environments, institutions should engage with students, alums, staff, community groups, industry, professions, and governments before defining priorities and relational strategies.
Benefits of Stakeholder Relationship Management Software
SRM Software is most useful for organizations concerned with the following:
Community engagement can take many forms. Government agencies need to consult with stakeholders as they develop legislation. Humanitarian organizations providing disaster relief must identify needs and coordinate assistance efforts. Project siting teams work with different communities and environmental groups to find the best place to build new corporate assets. SRM software helps all these teams plan and monitor community engagement activities, manage social risks, and make informed decisions to achieve better outcomes.
Keep large-scale land projects on track. Manage land and assets, activities, acquisition, and compliance activities in one place to improve project outcomes.
Demonstrate corporate social responsibility, transparency and accountability while working toward sustainable development goals and tracking sustainability metrics to improve your ESG score and making reporting on CSR easier.
What is CRM software?
Customer Relationship Management software is a tool that stores sales-related information, such as leads, contacts, opportunities, and purchase history. CRM software to helps companies improve business relationships and move customers through the sales funnel.
Who uses CRM software and why?
- Retail and eCommerce
Businesses use data about retail customers to understand purchasing patterns, build customer profiles, track and respond to complaints, unify customer support and service interfaces, and manage inventory.
Hotels and restaurants can use a CRM to track customer patronage, respond to concerns and complaints, nurture customer loyalty, and handle everyday tasks like booking reservations.
- Banking and other financial services Financial organizations use CRMs to classify customers based on their needs. While some customers only need basic products (like checking or savings accounts), others may require a wide range of products and services. Classifying customers according to their needs helps the organization identify customers who may be interested in additional products and more effectively target their marketing efforts.
Healthcare providers use CRM software to collect and consolidate patient information. This helps the organization better understand a patient’s profile, and to automate and customize their communications for each patient.
- Real estate
Real estate companies work with clients who come and go and inventory that changes in quantity and quality. A CRM system can help them keep track of their clients’ needs to help match a client to an appropriate property, store any relevant documents, and monitor where they are in the decision process to follow up appropriately.
The Benefits of Customer Relationship Management Software
Streamline the sales process to shorten the time to closing.
Track a customer’s purchase history – what they bought, when, the price paid, etc.
Recognize sales trends to understand purchasing patterns.
Find new customers and identify sales opportunities.
Speed up response time to improve customer satisfaction.
The differences between SRM and CRM software
Companies that need to implement a dedicated stakeholder engagement tool might be tempted to customize their existing CRM software for stakeholder management. It may seem like a practical shortcut to tweak the system you already have, instead of investing time and money in something new. After all, some tracking functions are similar, the system is already in place, and users know how to use it.
SRM and CRM software do share certain benefits. Both systems can:
- Centralize data to foster better collaboration within an organization.
- Ensure that everyone has access to information that’s complete, accurate, and up-to-date – from any location.
- Integrate other tools and applications for greater efficiency.
- Facilitate sharing of documents and templates.
- Track and respond to concerns and complaints.
- Automate manual tasks so teams can focus on human interactions, instead of managing data.
While at first glance, it may seem that CRM software can be repurposed for stakeholder engagement, this is rarely an acceptable solution. Despite their similarities, the two systems are designed for very different purposes. Let’s take a closer look:
|Platform||CRM Software||SRM Software|
|Designed to manage||Sales process – a standardized process that doesn’t change much from one customer (or product) to the next.||Stakeholder engagement – a flexible process that must continually adapt to meet the changing needs of a wide variety of stakeholders.|
|Purpose||To move customers through the sales funnel||To build and maintain stakeholder relationships|
|Goal||To maximize profits||To identify and implement mutually beneficial solutions|
|Type of cycle||Linear||Cyclical|
|Timeline||Relatively short||Long-term often lasting years|
|Used to track||Revenue||Interactions|
|Approach||Reactive – responds to issues as they arise||Long-term – prepares for potential issues before they emerge|
|Intended for||Businesses that need to manage a large number of customers, who have a fairly stable, predictable relationship with the company, as part of the sales or support process||Organizations that need to manage complex relationships with many different stakeholders or have a large team working on stakeholder engagement activities|
|Use as a stakeholder management tool||Can be customized (to some extent) for stakeholder relationship management, though not without significant risk.||Designed specifically for stakeholder relationship management, so it’s ready to use right out of the box|
Can CRM software be modified to serve as an SRM?
CRM software cannot be customized for SRM purposes without considerable risk, up to and including project failure. Let’s look at some of the potential problems with this approach.
- CRM software is not designed for SRM purposes. It’s based on different assumptions about the structure, dynamics, and time of the relationships involved; limitations in CRM software’s capabilities and functionalities reflect these differences in assumptions.
- It would take multiple customizations to make CRM software perform the way SRM software does. The entire process would take months or even years to complete fully. Gaps in performance and security will result, and adoption by project teams will suffer.
- CRM platforms are not built for SRM functions, so any changes made to the software by the company will cause modifications to fail. This would lead to additional work for IT personnel and delays to the project.
- When it comes to evaluating potential investors, connecting people to different organizations, or highlighting relationships between different individuals and entities, CRM systems fall short.
- Team members will be reluctant to adopt the software if it doesn’t work correctly, and the company will have spent money and time on a product no one uses.
For more information, please see our article on why CRM customizations fail at stakeholder engagement.
Ultimately, if you need to manage stakeholder relationships, SRM software is the better option… even for organizations that already use a CRM system.
A CRM is not an SRM
In 2021, the Brazilian city of Rio de Janeiro proposed a plan to build a Formula 1 (F1) circuit in the Camboata Forest, at the site of a former army base. For this new circuit to be built, the city would need to clear a large section of native forest, which amounted to tens of thousands of trees.
The project was backed by then-President Jair Bolsonaro and endorsed by Formula 1, but criticized by environmentalists. Before construction could begin, the project required approval from Brazil’s State Institute of the Environment and State Environmental Control Commission. When opposition to the project became clear, Rio’s mayor withdrew the application, and the environment secretary announced the cancelation of the project.
Clearly, this project had a large number of stakeholders. Not only would it involve the people and organizations that that are typically affected by a city construction project (e.g., government officials, regulatory bodies, contractors, local businesses, local communities, landowners, environmental groups, and media, among others), but since F1 racing is professional sport, other stakeholders also need to be considered. Some of these include Formula 1, event promoters, F1 fans, advertisers, sponsors, and even the racecar drivers themselves.
To manage a project like this, engagement teams would first need to identify all the stakeholders who would affect (or be affected by) the project and analyze their levels of interest and influence. This would allow them to classify the stakeholders into groups and establish engagement strategies for each.
For this project, racecar drivers would be highly influential stakeholders, given their legions of dans and extensive social media reach. Even though they all belong to the same stakeholder group, drivers had different opinions about the new circuit; some were in favor of the project, while others were opposed.
Engagement teams would need to keep track of each driver’s position and sentiment about the project while bearing in mind the amount of influence each person would have over public opinion, sponsors, and Formula 1. If a popular driver refused to participate at any events held at the proposed circuit, the repercussions could be significant.
SRM software is designed to manage all these factors to provide a global view of the situation. It helps teams understand the relationships between the key players and evolving sentiments held by the people involved, in order to address concerns and find areas of agreement as they work toward project success. It would be extremely difficult – bordering on impossible – to manage these relationships using a CRM.
The added cost of making the wrong decision
Over the years, our team has worked with several high-profile companies that initially tried to modify their existing CRM software for stakeholder relationship management. Here’s one example:
A business invested nearly $1 million to customize their CRM to meet their SRM needs. Unfortunately, the modifications caused significant downtime. The support team for their CRM did not cover the modifications they had made to their system. As a result, the company had to keep a full-time support staff on hand. Each time their CRM is updated, the revisions must be handled manually by their in-house team, creating unacceptable delays. And to make matters worse, even after more than 3 years, their teams still aren’t using the product.
This company regrets using their CRM to manage stakeholders. In the end, they gave up trying to force the system to function in a way that it wasn’t intended to, and are planning to implement a dedicated SRM system for this purpose. Sadly, they would have saved hundreds of thousands of dollars by choosing an SRM system from the start.
While customizing a CRM is possible – at least to some extent – the process is costly, unreliable, and time-consuming. Organizations that choose this route often find themselves stuck in a cycle of perpetual software modification that diverts their focus away from what really matters: building relationships with their stakeholders.
To learn more about the difference
between SRM and CRM software, and
the costs of making the wrong
decision, view this side-by-side look of how Borealis software compares to a customized CRM system.
Why choose Borealis as your SRM ?
For almost 20 years, Borealis and its dedicated team of customer support specialists have helped hundreds of organizations around the world take stakeholder engagement to the next level. We strive to be a partner our clients can depend on to constantly improve their stakeholder engagement processes and results. We’re committed to providing top-quality, ongoing support to make sure our customers succeed.
Borealis is a proven fit-for-purpose stakeholder engagement software (SaaS) developed by experts with extensive global experience.
Borealis is ready to go from Day One. As part of our proven delivery methodology, Borealis will configure the software to your specifications, import your existing data, and provide training as part of the Onboarding process.
The intuitive interface is easy to use, even for people who aren’t tech savvy. Borealis simplifies data entry and searches, which encourages user adoption and lets teams focus on building trusted relationships with stakeholders, not managing data.
Borealis offers hands-on, multilingual onboarding and training. Every client is assigned a dedicated Customer Success Advisor to provide personalized guidance and support.
Ready-to-use dashboards allow users to monitor the health of stakeholder relationships, identify and engage with people who have fallen off your radar, and recognize hot spots for key issues.
Our software is upgraded four times a year, based on evolving global best practices and clients feedback.
All modules are fully integrated, allowing multiple teams and departments to manage activities, communications, issues, community investments, and more, from a centralized database. Using one single application to manage all stakeholder engagement activities across business units improves efficiency and collaboration.
The built-in reporting tools in Borealis make it easy to generate detailed reports for internal management, regulators, and lenders in just a few clicks. Data can be analyzed by stakeholder type, date, location, or strategy.
The platform is instantly scalable; additional modules can be added as your needs evolve.
Borealis offers the highest security standards and follows GDPR and other data privacy acts standards.
Be part of our Community of Practice
When you adopt Borealis software, you aren’t just buying a product; you’re joining a community that builds on acquired knowledge for the benefit of all members. Our vast community of users gives us a great grasp on stakeholder engagement best practices. Borealis is updated four times a year, based on feedback from our customers around the globe. Their expertise and insights help us continually improve the software to help everyone who uses Borealis to manage stakeholder relations more efficiently and effectively.