Evaluation of Customer Relationship Management – System Success Merkur Day – Dr. Christoph Auer (MSc, PhD)

2 Evaluation of Customer Relationship Management – System Success Content of the Presentation -Initial Starting Point -Research Questions -Research Model and Method -Results

3 Evaluation of Customer Relationship Management – System Success Initial Starting Point -After the e-Business- „Hype“ came the CRM „Hype“ (CRM = Customer Relationship Management) -But in 86% of the CRM projects the results are not considered as satisfactory (with regard to the initial expectations) (Forrester Research, 2003) -IT-Spending 2002: (Forrester Research, 2003) - USA $ 866 Bill. - Europe € 648 Bill.  But what value for the businesses is generated? -When measuring the CRM-success there are 2 main problems: - The System is at the interaction point between businesses and their customers - The involvement of many intangible measures

4 Evaluation of Customer Relationship Management – System Success Framework Research Questions CRM Success (Outcome) ? ? ? ? ? 1. Which criteria is influencing the outcome (success/failure) of CRM initiatives? 2. How can the values of these criteria be fully and regularly measured? X Z Y RW €#.### or ##% 3. Which management framework must be established to influence the success criteria in a positive way? Objectives: 1. Identify the construct 2. Measurement approach 3. Describe the management framework

5 Evaluation of Customer Relationship Management – System Success The Research Project

6 Evaluation of Customer Relationship Management – System Success Research Phases Phase 1: Selecting a topic Research PhaseContent Research Instruments Phase 2: Analysis Phase 3: Developing and verifying a model Phase 4: Write up the dissertation Literature research Defining the objectives Document analysis (scientific literature) Focused literature research State of the art e-Services Quest. e-Business manager Document analysis Expert interviews Hypothesis model Customer survey Questioning of employees Customer survey Expert interviews Data analysis Verification of hypothesis Adaptation of the model

7 Evaluation of Customer Relationship Management – System Success Empirical Research Approaches Details Research Instrument Document analysis (scientific literature) Document analysis Expert interviews Customer survey Analysis of secondary data Expert interviews -Over 660 Sources were consindered -Attendance at 5 academic conferences in the field -Analysis and grouping of 398 empirical studies about the success measurement of information systems -Analysis of 499 web-sites which offer e-Services -Half-standardised questioning of nine e-Business managers about the current situation of CRM success management in different countries. -Standardised written and telephonic Interviews (86 items) with customer of an energy provider (w: 200 (RR:20,5%), t: 563 (AR:44,23%)  n=290) -Analysis of relevant data which was stored in the CRM system (n=282) -Standardised written and telephonic Interviews of employees

8 Evaluation of Customer Relationship Management – System Success Results 2 actors  2 different success perspectives Perspective of the provider Perspective of the user IS-Success Service Quality MIS Marketing

9 Evaluation of Customer Relationship Management – System Success Results CRM Performance Model (CPM, based on DeLone/McLean, 1992): A model for describing/measuring the success of CRM

10 Evaluation of Customer Relationship Management – System Success Hypothesis Model

11 Evaluation of Customer Relationship Management – System Success Empirical Results (Example) Satisfaction rate compared to number of contacts within the last two years once twice more than twice

12 Evaluation of Customer Relationship Management – System Success Empirical Results (Example) Regression analysis of the overall satisfaction rate

13 Evaluation of Customer Relationship Management – System Success Structural Equation Model (AMOS)

14 Evaluation of Customer Relationship Management – System Success Management Framework 1.Success measures for CRM -Which company-specific criteria influences my CRM success? -What do I need to measure? 2.Instruments to monitor and manage CRM success -How can the relevant criteria be measured? 3.Organizational issues -At which time needs what to be done by whom? -Which organizational structure is necessary?

15 Evaluation of Customer Relationship Management – System Success CRM Success Goals -System Quality -Information Quality -Business Process Quality -Employee Satisfaction -External Factors -Service Quality -Individual Outcome -Organizational Outcome

16 Evaluation of Customer Relationship Management – System Success Instruments for CRM Success Management Adaptation of existing instruments: -Customer-orientated process cost calculation -Customer Lifetime Value -Using success measures based on causal modelling (LISREL) Newly developed instrument: -CRM Performance Card (CPC)

17 Evaluation of Customer Relationship Management – System Success Organizational Issues Time frame: Responsibility: -External or self-controlling -Other issues

18 Evaluation of Customer Relationship Management – System Success CRM Performance Card

19 Evaluation of Customer Relationship Management – System Success Thank you for your attention christoph auer, dr. dipl.-ing. key account manager christoph auer, dr. dipl.-ing. key account manager evolaris Competence Center Hugo-wolf-gasse 8-8a, a-8010 graz Phone: Mobile: any questions?

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