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Why Microsoft's Biz Contact Software Is Worth the Money

Despite some drawbacks, this software application can add value.

Here's a small-business conundrum: What if Microsoft (MSFT) - Get Microsoft Corporation (MSFT) Report released software aimed at the smaller enterprise, but nobody heard it come to market?

Did Microsoft really release the product at all?

These existential depths are now being plumbed by a product called

Business Contact Manager, Microsoft's attempt to introduce little shops like yours and mine to so-called relationship contact management tools.

These tools, formerly for big business only, manage customers, projects, finances and the like.

Business Contact Manager originally shipped as part of Microsoft Office Outlook 2007, which launched a little over a year ago. Reaction has been far short of scintillating. The company says it has two million registered users for Business Contact Manager -- a sliver of the roughly 500 million Microsoft office productivity users worldwide.

Looking to jump-start interest, Microsoft announced last week that it will sell Business Contact Manager as a

stand-alone offering here for $150.

The move will make the product -- at least theoretically -- more attractive for smaller businesses.

Microsoft Office Small Business 2007, which comes with Outlook, Word, Excel and several other programs, runs $449 for a fresh license, exclusive of the operating system and hardware upgrades you really should get if you upgrade.

Definitely not cheap.

I have been testing Business Contact Manager for the past several months, and I have never understood the tepid market interest.

For little more than the cost of taking the family out for dinner and a movie, you can run a customer management system that tracks every phone call, email, task, project and sales lead just like the big boys.

That's not to say it's without issues.

It is the classic Microsoft computational hog: you need a serious machine to run the thing. I recommend at least a dual-core 2.6 GHz processor with 3 GB RAM, more if you can afford it. And the learning curve can be terribly steep. After all, you are putting every single bit of your business through Bill Gates' twisted imagination. Your business data is boiled down to a series of forms that Contact Manager seeks to optimize. Figuring out what goes where can be a chore.

Managing your Relationships

You know when you call

Verizon

(VZ) - Get Verizon Communications Inc. Report

, or

Geico

or

ConEd

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and the operator magically knows who you are and what you complained about the last time you called?

Those folks aren't clairvoyant.

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They are running software that tells them who you are, what you said and what they can do for you. Traditionally these sorts of relationship management tools were strictly multimillion-dollar technological affairs. Companies like

Oracle

,

(ORCL) - Get Oracle Corporation Report

,

SAP

and to a certain extent Microsoft itself, charged literally tens of millions for such systems. (How do think Larry Ellison paid for all those America's Cup yachts?)

And so the rest of us were forced to hobble along managing our clients with email, calendars, phones and paper logs.

Then upstarts like

Google

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Apps and others -- who offer business software basically for free - pressured Microsoft to offer new products like relationship-management tools as part of its basic office software line so the company could at least argue there was a reason you should pay $500 for Microsoft's latest products, like Office 2007.

Basically, Business Contact Manager delivers the relationship management goods.

Users are presented with an expanded version of Outlook. This more complex interface for managing email and calendars includes information on sales, marketing, clients and projects.

I won't lie to you, it takes some serious tinkering to get the hang of it all.

Microsoft has very firm views on how your business should be organized. For example, you fill out extended data on your clients: name, address, contact information, billing code, project status and the like. These then link to other pages that also need to be filled out -- what you said to whom during various phone calls and email -- which links to even more forms about files, finance and projects.

In the beginning there will be much hand-wringing as you organize your shop to fit Microsoft's model of the flow of information. But in time, as the data populates through Contact Manager, retrieving relevant information about your business gets easier and easier.

Calendaring, meetings and project management all are updated automatically. And Microsoft Office Accounting, for example, has some nice payroll and inventory features that automate billing and other features with Contact Manager. For my business, which is based on digital documents, the integration with Microsoft Office is excellent.

The greatest strength of Business Contact Manager is also its greatest weakness: In a sense, a single application runs your entire business.

That's great, until something goes wrong.

Since it is essentially a single program, Business Contact Manager can eat up enormous amounts of computational resources. So screens can run sluggishly. Some data is difficult to enter. And the whole thing will flat-out crash. I found I could not open two calendars at once and enter data at the same time without seizing up the software.

I learned quickly what I could and could not do.

In the end, Business Contact Manager is the Microsoft product you expect it to be. It is far too complex and stuffed with features that are not as fully fleshed out as they could be.

But the tool comes in at the right price and works well with the existing infrastructure. Deployed properly it can add real value to your business.

Just expect some swearing along the way.

Jonathan Blum is an independent technology writer and analyst living in Westchester, N.Y. He has written for The Associated Press and Popular Science and appeared on FoxNews and The WB.