Tigist Ayichew
Tigist Ayichew
MARY’S UNIVERSITY
BUSINESS FACULTY
DEPARTMENT OF MARKETING MANAGEMENT
BY:
TIGIST AYICHEW
JUNE, 2014
ST. MARY’S UNIVERSITY
ADDIS ABABA
AN ASSESSMENT OF CUSTOMER RELATION
MANAGEMENT PRACTICE: THE CASE OF ETHIOPIAN
POSTAL SERVICE ENTERPRISE (EPSE)
BY:
TIGIST AYICHEW
JUNE, 2014
ST. MARY’S UNIVERSITY
ADDIS ABABA
ST. MARY’S UNIVERSITY
BY:
TIGIST AYICHEW
___________________________ ________________________
Department Head signature
___________________________ ________________________
Advisor signature
___________________________ ________________________
Internal examiner signature
___________________________ ________________________
External examiner signature
ACKNOWLEDGEMENT
I would like to thank the Ato Yalew Gorfu, who encouraged me and
supported me throughout this research paper.
I would like to thank my friend W/ro Rediet Melese for her contribution in
assisting me in different aspects. There were also so many people who
greatly helped me through my study though their names are not mentioned
here.
Finally I want to say thanks to employees in the enterprise that are willing to
support me to get necessary information thank you all very much.
Table of Contents
Contents Page
Acknowledgement --------------------------------------------------------- I
Table of content ------------------------------------------------------------ II
List of table ---------------------------------------------------------------- III
CHAPTER ONE
1. INTRODUCTION -------------------------------------------------------- 1
1.1 Background of the Study ------------------------------------------ 1
1.2 Statement of the Problem ----------------------------------------- 2
1.3 Research Questions ------------------------------------------------ 3
1.4 Objective of the Study --------------------------------------------- 3
1.4.1 General Objectives --------------------------------------------- 3
1.4.2 Specific Objectives --------------------------------------------- 4
1.5 Significance of the Study ------------------------------------------ 4
1.6 Delimitation (Scope) of the Study -------------------------------- 4
1.7 Research Design and Methodology ------------------------------ 5
1.7.1 Research Design ----------------------------------------------- 5
1.7.2 Population and Sampling Techniques ---------------------- 5
1.7.3 Type of Data Collected --------------------------------------- 5
1.7.4 Data Collection Methods ------------------------------------- 6
1.7.5 Data Analysis Methods --------------------------------------- 6
1.8 Limitation of the Study ------------------------------------------- 6
1.9 Organization of the Paper ----------------------------------------- 6
CHAPTER TWO
2. REVIEW OF RELATED LITERATURE ------------------------------ 8
2.1 Origin of Customer Relationship Management ---------------- 8
2.2 Definition of Customer Relationship Management------------ 8
2.3 CRM Dimension -------------------------------------------------- 10
2.4 Definition of Customer Satisfaction --------------------------- 11
2.5 CRM and Customer Satisfaction ------------------------------ 13
2.6 CRM Strategy ----------------------------------------------------- 14
2.7 Classification of CRM -------------------------------------------- 16
2.7.1 Analytical CRM -------------------------------------------- 16
2.7.2 Collaborative CRM ---------------------------------------- 16
2.7.3 Operational CRM ------------------------------------------ 16
2.8 Focus of CRM ----------------------------------------------------- 16
2.8.1 Sales -------------------------------------------------------- 17
2.8.2 Customer service and support ------------------------- 17
2.8.3 Marketing automation ----------------------------------- 17
2.8.3.1 Data cleaning tools ----------------------------- 17
2.8.3.2 Content management -------------------------- 17
2.8.9.3 Campaign management------------------------ 17
CHAPTER THREE
3. DATA PRESENTATION, ANALYSIS AND INTERPRETATION -- 18
3.1 General Information of Respondents profile -------------- ---18
3.2 Analysis of the data directly related to the study-------- 21
3.2.1 Customer Satisfaction-------------------------------------- 21
3.2.2 Customer Communication-------------------------------- 23
3.2.3 Service Quality ------------------------------- -------- ------- 24
3.3 Responses Related to Customers’ Opinion --------- - -------- 27
3.4 Interview with the EMS Manager --------------------- --- ---- 28
CHAPTER FOUR
4. SUMMARY, CONCLUSIONS AND RECOMMENDATIONS ----- 30
4.1 Summary ---------------------------------------------- ---------- --- 30
4.2 Conclusions ---------------------------------------------- ------ --- 32
4.2 Recommendations --------------- ------------ --------------------- 33
Bibliography
Appendices
Interview Question -------------------------------------------------
Questionnaire ------------------------------------------------------
List of Tables
INTRODUCTION
2
aspects of the existing relationship, such as profitability information, risk
profiles and cross sell potential (Nielsen, 1998)
EMS Ethiopia is also one of the five core process and is Bronze winner of
2010 EMS quality service. Under EMS there are customer service and
mail handling teams. EMS Ethiopia is a member of EMS corporative
union which has 170 member countries currently; it has over 250
branch offices throughout the country. EMS sends messages through
door to door service and receives through call service. EMS Ethiopia is
fully supported by track and tracing system (IPS and Ragbi) software.
EMS is characterized by receives and delivers original documents,
parcels, merchandise, spare parts and samples those weights up to
30k.g. However based on the student researcher preliminary
investigation the following gap was well observed:
Not able to provide services for the customers at the time needed;
Unable to record the customers address for future use;
Lack of training for their employees to handle customer effectively;
Unable to use modern technology compared to competitors;
Therefore, the student researcher use suggests recommendation and
solutions to the above major problems by conducting the research.
3
identify the main problem in relation to CRM and give probable
recommendation.
4
In order to make this study more feasible, applicable and to use time
effectively the student research is use data between 2010 up to 2013G.C
5
1.7.4 Data Collection Methods
The student researcher used both the qualitative and quantitative data
analysis methods. The quantitative data gathered was analysed using
tables and percentage. The responses obtained from interviews were
summarized, and presented as statements in paragraphs.
6
significance of the study, Delimitation (Scope) of the study, Research
Design and Methodology, Limitation and organization of the study. The
second chapter is review of related literature, enabling to develop the
document and logically sequenced rational of problem. Chapter three
include data analysis and interpretation. The last chapter, Chapter four
provides conclusion and recommendation.
7
CHAPTER TWO
In the early 20th century in U.S, demand outpaced supply to the extent
that companies concentrated on selling as many products as possible.
Supplies focused on product development, manufacturing capacity, and
securing distribution out lets, without regarded to their customers. They
did not pay much attention to who bought their products or what their
customers needed (Ueno, 2006).
By the middle of the 20th century however the economy had matured to
a point there customers had the power of choice because supply had
outstripped demand. The era of the passive consumer was coming to an
end. Companies began to find out who their customers were, what they
wanted, and how they could be satisfied. They analyzed data about their
customers and segmented them based on their demographic such as age,
gender, and other personal information. Then they promoted their
product or service to a specific subset of customers and prospects. This
was called target marketing. Each company thought services about the
four Ps (price, promotion, product, and placement) the basic concept of
modern marketing, which was first suggested by the expert in the field,
(Ncarthin, 1960).
8
“CRM is strategy deals with how to establish developed and increase
customer relation from profitability perspective, based upon the
individual customer needs and potentials. The basic underling CRM is
that the basis of all marketing and management activities should be the
establishment of mutually beneficial partnership relation with customer
and other partners in order to become successful and profitable”
(Ghavanie, 2006).
9
and services, and aims to make the whole staff in the enterprise able to
conduct customer-based team work.
Despite there are differences among the definitions given to CRM, we can
learn that CRM involves cross functional integration i.e., the integration
of marketing, sales, customer service, IT and the supply chain function
of the organization to achieve greater efficiencies and effectiveness in
delivering customer value (Payne and Frow, 2005).
10
information technology and organizational changes in customer-centric
process. Companies that successfully implement CRM will reap the
reward in customer loyalty and long run profitability.
2.3.1 Key customer focus - this is all about developing strong
customer focus and continuously delivering superior value to the
selected key customers through personalized/customized
offerings.
11
customer’s needs an enable customer satisfaction. So clearly defining
and understanding customer satisfaction can help any company identify
opportunities for product and service innovation and also serve as a
basis for performance appraisal and reward systems. It can also serve as
the basis for customer satisfaction surveying program that can ensure
that quality improvement efforts are property focused on issues that are
most important to the customer. (LI, 2002)
12
2.5 CRM and Customer Satisfaction
13
management of the customer relationships is the key to managing
customer satisfaction and customer loyalty.
Referring to the above CRM finding, CRM solution is still one of the best
strategies for growing revenue and increase market share and that CRM
offers richer opportunity to provide quality of service to enhance
customer satisfaction.
14
new business start-ups are product-oriented in these firms it is
common for the customer’s voice to be missing when important
marketing, selling or service decisions are made. Little or no
customer research is conducted. Management makes
assumptions about what customers want. The outcome is that
sometimes products are over specified or over engineered for the
requirements of the market, and therefore too costly for many
customers. However, marketers have identified a subset of
relatively price-insensitive, customers whom they dub ‘innovators’,
who are likely to respond positively to company claims about
product excellence. Unfortunately, this is a relatively small
segment, no more than 2.5 per cent of the potential market.
15
customers. A customer-centric firm is a learning firm that constantly
adapts to customer requirements and competitive conditions. There is
evidence that customer-centricity correlates strongly with business
performance.
2.7.1 Analytical CRM: this implies the use of data modelling and
profiling to accomplish the CRM goals.
2.7.2 Collaborative CRM: this implies the tools that should not be used
while directly engaging and interacting with the customers.
2.7.3 Operational CRM: this implies the ‘back end’ systems, which unify
the business operations and deliver the products.
The CRM should be the architecture for each purpose, while the
furnishing required to make the architecture work would be provided by
the customer data. The core of CRM effectiveness lies in the deep and
reliable customer information. In other words, the companies should
know as much about each customer as possible and in many cases,
much more than they have known at present. (S.Shajahan, 2004)
The three main areas that the CRM systems should maintain their focus
are the: (S.Shajahan, 2004)
16
2.8.1 Sales: also called the sales force automation, includes field sales,
call centre telephone sales, third-party brokers, distributors or
agents, retail marketing and e-commerce (which is also referred to
as the technology-enabled selling).
2.8.2 Customer service and support: includes file service and despatch
technicians, internet-based service or self-service via a web site
and call centres that handle all channels of customer contact (and
not just voice).
2.8.3 Marketing automation: differs from the other two categories as it
does not involve the customer contact. The marketing automation
focuses on analysing and automating the marketing processes. The
marketing automation products include the following:
2.8.3.1 Data-cleansing tools; data analysis or business
intelligence tools for ad hoc querying, reporting and
analysing customer information, plus as data warehouse or
data mart to support strategic decision.
2.8.3.2 Content-management applications that allow a company’s
employees to view and access business rules for marketing
to customers.
2.8.3.3 Campaign management system, a database management
tool used by the marketers to design the campaigns and
track their impact on various customer segments over time.
Depending on the company goals, the tools it chooses
would be integrated across the areas of sales, services and
marketing. (S.Shajahan, 2004)
17
CHAPTER THREE
18
Table 1 General Characteristics of Respondents
Customer respondent
Item
Description Frequency Percentage (%)
1 Gender
a. Male 98 55.36
b. Female 79 44.63
Total 177 100
2 Ages
a. 21-30 year 78 44.06
b. 31-40year 59 33.33
c. 41-50year 26 14.68
d. 51 and above year 14 7.90
3 Educational background
a. 1 - 12 grade complete 43 24.29
b. Certificate 28 15.81
c. Diploma 44 24.85
d. First Degree 44 24.85
e. 2nd Degree and Above Degree 18 10.16
Total 177 100
4 Occupation
a. Student 18 10.16
b. Private company 53 29.94
c. Government 40 22.59
d. NGO 13 7.34
e. Self employed 32 18.07
f. Others 21 11.86
Total 177 100
Source: Questionnaire Survey
19
According to item 1 of table 1 in the previous page which indicated
gender composition of respondents, 98 (55.36%) of the respondents were
male and 79 (44.63%) of them were female. Male respondents dominate
over female respondents.
In relation to age category as shown in item 2 of the same table the
number of respondents in age category of 21-30year where 78 (44.06%),
in age 31-40 where 59 (33.33%), in age 41-50 where 26 (14.68) and
above 51 years where 14 (7.90%). Therefore, the finding from the age
profile of the respondents indicates that the majority of the customer
respondents were found between the ages of 21-30years.
Item 3 in the table 1 in the previous page explain the educational status
of the respondents. Accordingly, out of the total customer respondents
43 (24.29%) of the respondents were 12 grade complete, 28 (15.81%) of
the respondents were certificate holders, 44 (24.85%) of the respondents
were diploma holders, 44 (24.85%) of the respondents were first Degree
holders, and 18 (10.16%) were 2nd degree and above degree. On the basis
of the above data educational background most customer are degree and
diploma holder educated customer are capable enough to evaluate things
from different analysis and sensitive to service delivery promises.
As depicted in the above table of item 4 out of the total respondents
concerning of occupation, 18 (10.16%) were student, 53 (29.94%) were
private company, 40 (22.59%) were government, 13 (7.34%) were NGO,
32 (18.07) were self employed and 21 (11.86%) were other.
20
When we go to directly to the above table 2, the respondents
characteristics we will find relationship with the company 90 (50.84%)
were 1-3 years, 63 (35.59%) were 4-6 years, 13 (7.34%) were 7-10 years
and 11 (6.21%) were 11 year and above. This implies that most of the
time respondents’ lengths of the time using EMS service are 1-3 years.
The company does not retain customers for long period of time. This
indicates that customers are dissatisfied the company finds out the
source of dissatisfaction and takes the necessary.
21
Table 4. Employees’ courteous
Customer respondent
Item Frequency Percentage (%)
How do you see the employees courteous
Strongly agree 23 12.99
Agree 54 30.50
Neutral 20 11.29
Disagree 62 35.02
Strongly disagree 18 10.16
Total 177 100
Source: Questionnaire Survey
22
3.2.2 Customer Communication
Table 6. Customer suggestion (feedback)
Customer respondent
Item
Frequency Percentage (%)
EMS accepts customer suggestion
(feed back)?
Strongly agree 25 14.12
Agree 43 24.29
Neutral 19 10.73
Disagree 53 29.94
Strongly disagree 37 20.90
Total 177 100
Source: Questionnaire Survey
In terms of customer suggestion 25 (14.12%) strongly agree, 43 (24.29%)
agree, 19 (10.73%) responded neutral. 53 (29.94%) responded disagree
and 37 (20.90%) strongly disagree. From this responses indicated that
EMS did not response timely. This implies that customers are challenged
by cruel service of EMS.
23
communication to solve any problem or to give information about the
service.
24
The previous table 9 indicate that, customer service requirement reveal
that 28 (15.81%) strongly agreed, 56 (31.63%) agreed, 26 (14.68%)
responded neutral, 48 (27.11%) disagreed and 19 (10.73%) strongly
disagreed. This indicates that attainment of requirement and expectation
of customer requires the regular and constant improvement of mail
exchange and circulation services and collectively working with various
companies.
25
Table 11. Employees’ behaviour
Customer respondent
Item Frequency Percentage (%)
Employees impress customers with the
reliability service?
Strongly agree 31 17.51
Agree 58 32.76
Neutral 22 12.42
Disagree 47 26.55
Strongly disagree 19 10.73
Total 177 100
Source: Questionnaire Survey
26
3.3 Responses Related to Customers’ Opinion
According to customer, as for the quality of services, they are said that
significantly improving from time to time in terms of efficiency and safety
as the result of the operational or business process reforms ventured by
the enterprise as well as of the latter’s improved status for utilization of
technologies.
Even if the problems related to loss of items were by and large addressed
the speed – element is still diagnosed with light – delays additionally, the
occasional exposure of parcels to rain and the risk of being torn /damage
has caused a rise in customer – complaints.
27
3.4 Interview with the EMS Manager
But generally, EPSE give attention to CRM specially now a days. In the
contemporary world of highly advanced and sophisticated information
technologies combined with the engagement of multiple private couriers
in the postal service sector and with the abundance of diversified
customer choices, helping the Enterprise’s clients access information on
the safety – status of their postal – messages and subsequently put
undisputable sense of confidence or trust in the enterprise always
remains an expeditious task of paramount – importance through the
synchronic application of state of the art information technologies more
than ever before to that effect. In order to keep existing or surviving and
even keep existing or surviving and even outperforming in this tight
market – competition, it is highly required to devise and implement
efficient and cost – effective operational or business processes
technologies; to this end, thus, the enterprise has already launched the
application of such service components as Counter Automation and Mail
Processing System, Internet Based inquiry System, Global Monitoring
System, Quality Control System, Track and Trace System, SMS
notification System as well as CCTV Camera system.
28
related technical expenses and skills of employees are ever improving as
the result of their exposure to the regularly organized “In-House” and
“External” Training Programs on top of that, the enterprise, which
retained senior staff members and recruited new employees, is well –
staffed with a large number of highly – skilled, qualified, well – trained
and experienced workforce.
29
CHAPTER FOUR
SUMMARY, CONCLUSIONS AND RECOMMENDATIONS
This section of the study presents summary of the research are listed,
conclusions remarks considering the overall the study and provides some
valuable recommendations that can upgraded the prevailing customer
relationship management practice of EMS service.
4.1 Summary
Major finding of the research are listed as follow:
• Generally the customer respondents are diversified in gender, ages,
education background, and occupation. Thus, based on the findings
the majority of respondent were between age of 21-30Yrs, sex
distribution were dominated by male, educational background most
customers are diploma and degree holder educated.
• As relationship with the EMS the responses made by customers out of
the total respondents 90(50.84) of them were becoming the customers
of EMS 1-3 years.
• With regard to complaints or problems majority 74(41.79%) disagree
and 43 (24.29%) neutral that their complaint or problems do not solve
with great concern.
• Regarding employees courteous majority 80 (45.18%) disagree that
employees of the company are not courteous.
• Majority 82 (48.41) customers replied that their level of satisfaction is
low.
• Issue relating to customers suggestion (feedback) respondents are
disagree 90 (50.84%) that their suggestion or feedback is not accepting
by the company.
• Regarding communication with customers majority 94 (53.09%) agree
that the enterprise uses phone or email to communicate with customer.
30
• When asked to enterprise uses customers suggestion to improve and
introduce new service majority 84 (47.45%) disagree that the enterprise
does not use customers suggestion to improve and introduce new
services followed by 26 (14.68) neutral therefore the level of acceptance
suggestion from customer is low.
• With regard to customer requirement expectation most of the
respondent 84(47.45%) at replayed agreed.
• In relation to employees willingness help customer majority of the
respondent 84(47.45%) replayed not willing to help customer.
• Majority of respondents 86 (50.27%) replayed that employees behaviour
to impress customer with reliability of the service are strongly agreed.
• Regarding to office environment conduciveness to give service majority
of the respondents 73 (41.23%) replayed office environment of EMS is
not will organize and attractive.
• Concerning with the customers suggestion for open ended question
most of them suggest that the enterprise’s service charge rates are
reasonably fair in comparison to those of competitors yet, it is widely
complained by clients that rates for international “outbound” parcel
service and EMS did not somewhat consider the existing public
affordability despite the proficiency, qualification /competence and
commitment of the enterprise’s personnel for achieving customer
satisfaction, certain employees are still characterized by poor customer
handling, tardiness or non-punctuality, de-motivation or lousiness
across arrange of practical cases.
31
4.2 Conclusions
32
4.3 Recommendations
33
Bibliography :- (Books. Thesis, Journals)
• Adian payne and Pennie Frow (2005) ,”A strategic Framework for
customer Relationship management” Journal of marketing
Vol. 69,
34
Facility Managers”, journal of facilities management 2005,3,4
ABO/INFORM GLOBAL.
35
Appendix 1
ST. MARY’S UNIVERSITY
BUSINESS FACULTY
36
Appendix 2
ST. MARY’S UNIVERSITY
BUSINESS FACULTY
DEPARTMENT OF MARKETING MANAGEMENT
√” in the box
Instruction: please put “√
Part I. General Information of Respondents
1. Gender
1. Female 2. Male
2. Age
1. 21-30 year 2. 31-40year 3.41-50year
4. 51 year and Above
3. Educational background.
1. 1 - 12 grade complete 2. Certificate 3. Diploma
4. First Degree 5. 2nd Degree and Above Degree
4. Occupation
1. Student 2. Private company 3. Government
4. NGO 5. Self employed 6.others
5. Years in relationship with EMS.
1. 1-3 Years 2. 4-6years
3. 7-10years 4.11 year and above
37
TOPIC 1 2 3 4 5
38
Appendix 3
••••• •••• ••••••
•••• ••••
•••••• •••••• •/•••
•••••• •••• •••• ••••
••••• •••• •••••• •••••• •••••• •• •••• ••• ••• •••• ••••
••••• ••••• ••••••• ••• ••••• •••••••• ••••• ••••• •••
•••••• ••••• •••• ••••••• •••••••
•• •••• •••• •••••• •••••• ••••• ••••••• •••••• ••••• •••
••••• •••••• ••• •••••• •••• ••• ••••• ••.••.•• ••• ••••••
••••• •••• •• ••••••• •••••• ••••• ••••• ••••• ••••• •••
••••• ••••
•• ••••• ••••• ••• •••• •••• ••••• ••••••• ••• •••••••••
2. •••
1.21-30 ••• 2. 31-40•••
3.41-50••• 4. 51•••• ••• •••
3. •••••• •••
1. 1• •••12• ••• 2. •••••• 3. ••••
4. •••••• ••• 5. •••• •••• ••• •••
4. ••• ••••
2. ••• 2. ••• 3. ••••••
4. •••• ••• •••• 5. ••• •• 6. ••
39
1 2 4 5
••• ••• ••••••
3
••••••/ ••••••
•••
••••••
•••••• ••••••
------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------
-------------------
40
Name: Tigist Ayichew
Signature:
ADVISOR’S DECLARATION
This paper has been submitted for examination with my approval as the
university advisor.
Signature:
41