CRM - an Operational

Tool for Customer Centric

Actions : Case Study in
Service Sector
ANIKET J. SHIRALKAR
DPGD/AP13/1008.
What is CRM?
 CRM “is a business strategy that aims to understand,
anticipate and manage the needs of an organisation’s
current and potential customers” (1).
 It is a “comprehensive approach which provides seamless
integration of every area of business that touches the
customer- namely marketing, sales, customer services and
field support through the integration of people, process
and technology” (1)
 CRM is a shift from traditional marketing as it focuses on
the retention of customers in addition to the acquisition of
new customers (2)
 “The expression Customer Relationship Management
(CRM) is becoming standard terminology, replacing what
is widely perceived to be a misleadingly narrow term,
relationship marketing (RM)” (3).
Definition of CRM

“CRM is concerned with the creation,

development and enhancement of
individualised customer relationships with
carefully targeted customers and
customer groups resulting in maximizing
their total customer life-time value” (2).
The purpose of CRM

 “The focus [of CRM] is on creating value for

the customer and the company over the
longer term” (3).
 When customers value the customer
service that they receive from suppliers,
they are less likely to look to alternative
suppliers for their needs (3).
 CRM enables organisations to gain
‘competitive advantage’ over competitors
that supply similar products or services (1)
Why is CRM important?
 “Today’s businesses compete with multi-
product offerings created and delivered
by networks, alliances and partnerships
of many kinds. Both retaining customers
and building relationships with other
value-adding allies is critical to
corporate performance” (3).

 “The adoption of C.R.M. is being fuelled

by a recognition that long-term
relationships with customers are one of
the most important assets of an
organisation” (2)
Why did CRM develop?
CRM developed for a number of reasons:

 The 1980’s onwards saw rapid shifts in

business that changed customer power
(4)
 Supply exceeded demands for most
products (4)
 Sellers had little pricing power (4)
 The only protection available to suppliers
of goods and services was in their
relationships with customers (4)
What does CRM involve?

CRM involves the following (4):

 Organisations must become customer

focused
 Organisations must be prepared to adapt so
that it take customer needs into account
and delivers them
 Market research must be undertaken to
assess customer needs and satisfaction
 Functional Elements of CRM
Marketing Sales Customer Service
• Market Research • Sales Automation and • Customer Inquiry
Management
• Product Development • Customer product
• Customer Profiling support
• Market Assessment
• Account Management • Customer Information
• Market & Customer Management
Segmentation • Opportunity Management
• Call Center
• Product Lifecycle • Product, Price, and Effectiveness
Management Contract Negotiation
• Trouble Analysis &
• Product Pricing and • Sales Alignment and Resolution
Profitability Incentives
• Billing

Customer Relationship Management Solutions

• Data Warehouse Management and Decision Support

• Integrated Customer Management Systems
“Strategically significant customers”

 “Customer relationship management

focuses on strategically significant
markets. Not all customers are
equally important” (3).
 Therefore, relationships should be
built with customers that are likely to
provide value for services
 Building relationships with customers
that will provide little value could
result in a loss of time, staff and
financial resources
Markers of strategically significant customers

 Strategically significant customers need to satisfy

at least one of three conditions (3):

1. Customers with high life-time values (i.e.

customers that will repeatedly use the service
in the long-term e.g. Nurses in a hospital
library)
2. Customers who serve as benchmarks for other
customers e.g. In a hospital library consultants
who teach on academic courses
3. Customers who inspire change in the supplier
formation Technology and CRM

 Technology plays a pivotal role in CRM (2).

 Technological approaches involving the use of
databases, data mining and one-to-one marketing
can assist organisations to increase customer value
and their own profitability (2)
 This type of technology can be used to keep a
record of customers names and contact details in
addition to their history of buying products or using
services (2)
 This information can be used to target customers in
a personalised way and offer them services to meet
their specific needs (2)
 This personalised communication provides value for
the customer and increases customers loyalty to the
provider (2)
An example
The Elements of CRM
Sales force Customer service/call Marketing
automation center management automation

Call center telephone sales Call Centers Campaign

Managing aspects management
E-commerce Of customer contact

Field sales
Web-based Content
Retail self service management

Data analysis
Third-party brokers, Field services
And business
Distributors, agents and dispatch
Intelligence tools

Data warehouse and data cleaning tools

CRM Applications

*Source: Patricia Seybold Group

Face-to-face CRM
 CRM can also be carried out in face-to-face
interactions without the use of technology
 Staff members often remember the names and
favourite services/products of regular customers and
use this information to create a personalised service
for them.
 For example, in a hospital library you will know the
name of nurses that come in often and probably
remember the area that they work in.
 However, face-to-face CRM could prove less useful
when organisations have a large number of
customers as it would be more difficult to remember
details about each of them.
Benefits of CRM
Benefits of CRM include (8):

 reduced costs, because the right things are being done

(ie., effective and efficient operation)
 increased customer satisfaction, because they are
getting exactly what they want (ie. meeting and
exceeding expectations)
 ensuring that the focus of the organisation is external
 growth in numbers of customers
 maximisation of opportunities (eg. increased services,
referrals, etc.)
 increased access to a source of market and competitor
information
 highlighting poor operational processes
 long term profitability and sustainability
Implementing CRM

 When introducing or developing CRM, a strategic

review of the organisation’s current position should be
undertaken (2)
 Organisations need to address four issues (2):
1. What is our core business and how will it evolve in the
future?
2. What form of CRM is appropriate for our business now
and in the future?
3. What IT infrastructure do we have and what do we
need to support the future organisation needs?
4. What vendors and partners do we need to choose?
References
1. Liz Shahnam. What’s really CRM? CRM Today. [Online]
[Accessed November 2008]
2. Adrian Payne. Customer relationship management. Cranfield
University. [Online] [Accessed June 2006, no longer available
online]
3. Francis Buttle. The S.C.O.P.E of Customer Relationship Marketing.
Macquarie Graduate School of Management. [Online]
[Accessed June 2006, no longer available online]
4. Manchester Business School. 2003. Customer Relationship
Management: Where do you start?
5. Wikipedia. HTTP Cookie. Online] [Accessed November 2008]
6. Brian Woolf. What is loyalty? The Wise Marketer. [Online]
[Accessed June 2006, no longer available online]
7. Wikipedia. Customer Relationship Management. [Online]
[Accessed November 2008]
8. BusinessBalls. Customer Relationship Management. [Online]
[Accessed November 2008]
THANK YOU.