INTRODUCTION AND SIGNIFICANCE OF CUSTOMER RELATIONSHIP

CRM  MEANING?

CRM  BUZZWORD  SINCE EARLY 1990s, MORE FOCUS  PRACTIONERS AND CONSULTANTS USE TERM CRM TO REFER TO TECHNOLOGY ENABLED PROCESSES FOR CUSTOMER INTERACTIONS, WHILE ACADEMICIANS PREFER TERM ‘RELATIONSHIP MARKETING’

CRM  EARLY ADOPTERS WERE FINACIAL SERVICES, RETAILING, TELECOM, TRAVEL, HOSPITALITY  LEADING CRM VENDORS SIEBEL SYSTEMS, SAP, ORACLE, PEOPLESOFT, EVEN MICROSOFT  SIEBEL, WORLDWIDE LEADER, PRODUCTS AT 3500 ORGANIZATIONS, 2 MILLION USERS(2003)

ENABLERS FOR GROWTH OF CRM  EMERGENCE OF SERVICE ECONOMY -GROWTH RATE AND % OF GDP..  EMERGENCE OF MARKET ECONOMY  GLOBAL ORIENTATION OF BUSINESSES  AGING POPULATION OF ADVANCED ECONOMIES

CRITICALITY OF CUSTOMER RELATIONSHIPS THREE CHALLENGES THREE CHALLENGES  NON-TRADITIONAL COMPETITION..NEW ENTRANTS FROM OUTSIDE INDUSTRY, SUBSTITUTE TECHNOLOGY, SUPPLIER A COMPETITOR, CUSTOMER AS COMPETITOR

CRITICALITY OF CUSTOMER RELATIONSHIPS THREE CHALLENGES THREE CHALLENGES  MARKET MATURITY..FOCUS ON CAPACITY UTILIZATION THAN CREATION..SLOW OR ZERO GROWTH..IMPORTANCE OF REPEAT CUSTOMERS..EMERGING MARKETS LIKE CHINA AND INDIA..UNDERSTNDING THEM

CRITICALITY OF CUSTOMER RELATIONSHIPS THREE CHALLENGES THREE CHALLENGES  MISALIGNMENT BEWTEEN REVENUES AND PROFITS..ACTIVITY BASED COSTING ABC..REVENUE FOM CUSTOMERS AND COST OF DOING BUSINESS WITH THEM..REVENUES EXPONENTIAL, COSTS ARE MORE LINEAR..REVENUES SKEWED TOWARDS LARGER CUSTOMERS, 80:20 RULE, BIGGEST AND SMALLEST CUSTOMERS MAY BE LESS PROFITABLE..NEGOTIATION..

WHY BUSINESSES SHOULD ADOPT CRM  DEMAND..RISING CUSTOMER EXPECTATIONS..  INCREASING AFFLUENCE IN EMERGING ECONOMIES..MIDDLE CLASS..SIZE 300 MILLION IN INDIA..DEMANDING AND QUALITY CONSCIOUS..SELLERS TO BUYERS MARKET..PROFESSIONAL CLASS..NUCLEAR FAMILIES WITH DOUBLE INCOME (DINK)..OUTSOURCING..

WHY BUSINESSES SHOULD ADOPT CRM GREATER AWARENESS DUE TO MEDIA  INFO ABOUT PRODUCTS, SERVICES, LIFESTYLES, CABLE, DISH, INTERNET  FAST PENETRATION  RAISING ASPIRATIONS AND EXPECTATIONS

WHY BUSINESSES SHOULD ADOPT CRM CUSTOMER DIVERSITY  MORE CHOICES  BETTER LIVING STANDARDS  METROPOLITAN CULTURES

WHY BUSINESSES SHOULD ADOPT CRM SUPPLY..AFFORDABLE TECHNOLOGICAL ADVANCES  PRODUCTION..CAD-CAM, FMS(FLEXIBLE MANUFACTURING SYSTEMS), JIT  DISTRIBUTION..CALS..COMPUTER AIDED LOGISTICS..WEB-BASED, VSAT-BASED

WHY BUSINESSES SHOULD ADOPT CRM SUPPLY..AFFORDABLE TECHNOLOGICAL ADVANCES  FACILITATION..E-COMMERCE, INTERNET, DISINTERMEDIATION, 01 MARKETS.COM  CONSUMPTION..PERSONAL Ids, PERSONALIZE, DELL..CONFIGUR..ATMs, CALL CENTRES, NET BANKING

IMPLEMENTING CRM  1-1 RELATIONSHIP WITH KEY CUSTOMERS..JOBS OF RELATIONSHIP MANAGERS  CUSTOMER CARE..CRM  BENEFITS..LOWER COSTS OF CUSTOMER RETENTION..AND..INVREASED PROFITS DUE TO LOWER DEFECTION RATES

IMPLEMENTING CRM CHALLENGES WHILE SELECTING AND IMPLEMENTING CRM SOLUTIONS  TOP MANAGEMENT  CHANGE MANAGEMENT  DEVELOPING CUSTOMER CENTRIC PROCESSES  INTEGRATION  PERFORMANCE METRICS  EVALUATION OF ROI

IMPLEMENTING CRM  MANY COMPANIES ARE SPONSORING A NUMBER OF CRM INITIATIVES..ACC TO A STUDY..63% DID NOT KNOW HOW MUCH THEIR CRM EFFORTS INCREASED OR DECREASED THEIR PROFITABILITY –DAY(2000) HAD IDENTIFIED 3 ELEMENTS OF MAKET-RELATED CAPABILITY  FIRST, A RELATIONSHIP ORIENTATION MUST PERVADE THE MINDSET, VALUES AND NORMS OF THE ORGANIZATION

IMPLEMENTING CRM DAY(2000) HAD IDENTIFIED 3 ELEMENTS OF MARKET-RELATED CAPABILITY DAY(2000) HAD IDENTIFIED 3 ELEMENTS OF MARKET-RELATED CAPABILITY  SECOND, THE FIRM MUST KEEP DEEPENING ITS KNOWLEDGE OF THESE CUSTOMERS AND PUTTING IT TO WORK THROUGHOUT THE ORGANIZATION, AND  THIRD, THE KEY PROCESSES MUST BE INTERNALLY INTEGRATED AND EXTERNALLY ALIGNED WITH THE CORRESPONDING PROCESSES OF FIRM’S CUSTOMERS