MS809 – Enterprise

Systems

Week 11 –Customer
Relationship Management
(CRM)

Dr Mona Isazad Mashinchi– Academic Year 2024/25 University

[email protected] ofGalway.ie
 Walt Disney and CRM

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 • CRM focus should always be on customer experience
• CRM implementation needs to be customer driven more than
technology driven
• CRM implementation must involve people, process, and systems,
rather than just a narrowly defined IT application

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 • CRM is much more than the software utilized to store, analyze, and
manage customer relationships
• CRM integrates corporate strategy, business methodology, and
technology to accomplish a myriad of goals for companies that want
to operate in a customer-driven environment
• CRM as a concept is as old as business itself
• No business can survive without understanding its customers and having
a positive relationship with them.

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 What is CRM
• CRM is a strategic initiative, not a technology. Information technology is an
essential enabler of all but the smallest CRM initiatives.
• CRM relies on customer personal and transactional data and is designed to
help the firm learn about them.
• The most important thing about CRM is right there in the first word—it’s about
customers. A CRM help to understand customers better and use that
information to deliver the best possible customer experience (CX).
 Evolution of CRM Programs

Evolution of Customer Relationship Management (Chapter 11)

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Business Strategy Perspective of CRM

Promotes customer-centric approach

Customer segmenting
Business
One-on-one marketing
Increase customer retention
Foster close customer relationship
Technology Analyze customer information
Coherent view of customer

Increased interaction opportunity

Customer Increase customer loyalty
Better “word-of-mouth” advertising
(Chapter 11)
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 3 Types of CRM
From an implementation perspective, CRM systems can be ;

1. Operational CRM systems

2. Analytical CRM systems
3. Collaborative CRM systems

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 Operational CRM systems
• Streamline a company’s processes for customer relationships
• Provide tools to better visualize and more efficiently handle the full
customer journey
• Typically provide automation features (e.g., marketing, sales)

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 Analytical CRM systems
• Primary focus of helping to analyse the customer data to gain important
insights.
• Provide insight to see trends in how customers behave.

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 Collaborative CRM systems
• It ensure all teams have access to the same up-to-date customer data,
no matter which department or channel they work in.
• It treats each interaction as part of a larger, integrated conversation
between the brand and the customer.

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 CRM Processes
Research in the support of customer relationships processes has shown
that these processes can be categorised into three areas:
• CRM delivery processes
• CRM support processes
• CRM analysis processes

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 CRM Delivery Processes
• Campaign Management
– generate “leads” or potential clients for the organization.

• Sales Management
– to convert the lead generated by campaign management into a potential
customer.

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 CRM Delivery Processes
• Service Management
– provide ongoing support for the client and to assist in the operation of the
product or service purchased by the customer
• Complaint Management
– to improve customer satisfaction by directly addressing the complaint of the
customer and supporting a continuous improvement process to increase
customer retention in the long run.

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 CRM Support Processes
• Market research
– systematic design, collection, analysis, and reporting of data, and on findings
relevant to specific sales activity in an organization.
• Loyalty management
– optimize the duration and intensity of relationships with customers.
increase the switching costs of the customers by providing incentives like the
frequent-flyer programs or churn management tools, which provide early
warning on customers planning to switch to competitors.

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 CRM Analysis Processes
• Lead Management
– organizing and prioritizing contacts with the prospective customers.
It involves integration with campaign management and service
management, as well as customer profiling.
• Customer Profiling
– to develop a marketing profile of every customer by observing his or her
buying patterns, demographics, buying and communication preferences,
and other information that allows categorization of the customer.
– The knowledge generated from this process feeds into campaign management,
sales management, service management, and the other processes

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 CRM Analysis Processes
• Feedback Management
– A good CRM requires a closed-knowledge management loop that consolidates,
analyzes, and shares the customer information collected by CRM delivery and
support processes with the analysis process, and vice versa.

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CRM Architecture

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 Cloud CRM
• Traditional on-premises CRM systems are
complex in architecture and usually take a lot of
time to install and implement.

• Cloud-based CRMs host all solutions in the

cloud versus on-premises CRMs, which are
typically hosted at your location and managed by
your IT department.

• In Cloud-based CRMs updates, maintenance, and

storage of a CRM application is done by the cloud-
based CRM provider, whereas with an on-premises
CRM that is managed by an in-house IT department.

• A cloud-based CRM is easy to use and offers

instant access to critical information across the sales
cycle.

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 Cloud CRM
• A cloud-based CRM is typically extremely
affordable with minimal upfront costs when
compared to a traditional CRM where the initial
capital investment can be higher.

• Cloud-based CRMs offer anytime,

anywhere access to important information that
helps organizations improve process efficiency.

• Most traditional CRM systems are stand-

alone systems with very poor integration
capabilities.

• Cloud-based CRM systems offer robust

integration with multiple third-party products

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 CRM Benefits
Benefit Examples
Enables 24/7/365 operation Web-based interfaces

Individualized service Learn how each customer defines product and service quality

Improved information Integrate all information for all points of contact

Speeds problem Improved record keeping and efficient methods of capturing
identification/resolution customer complaints
Speeds processes Integrated information removes information handoffs
Improved integration Information from the CRM can be integrated with other systems
to streamline business processes
Improved product Tracking customer behavior over time helps to identify future
development product and service offerings
Improved planning Provides mechanisms for managing and scheduling sales follow-
ups
Benefits of CRM: Improves Customer Service

• Improved customer satisfaction rating

• acquire and retain customers
• provides support to customer service representative with relevant
information
• provides solutions to deal with customer related issues – decision making
Benefits of CRM: Improves Sales and Marketing

• caters to demands of sales, marketing and customer service

• helps increase existing sales effectiveness (spending more time with
customers, spending less time chasing, needed information)-
productivity improvement
• helps in business forecast
• increases effectiveness of call centres
• increase sales globally
• Increased win rates
• Increased margins – knowing customers better, providing a value
sale, discounting prices)
 CRM Implementation Challenges
• Cost Overruns: Struggling to keep CRM implementation within budget, facing
unexpected costs and financial strain.

• Unclear Objectives: Lacking a clear direction and specific goals for what the CRM
system needs to achieve, leading to potential misalignment with business strategies.

• Deployment Type Mismatch: Choosing a deployment option that doesn’t fit the
organization's technical infrastructure, operational needs, or scalability requirements.

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 CRM Implementation Challenges
• Inadequate Training: Users are not fully equipped or confident in using the CRM
system, resulting in underutilization and inefficiency.

• Difficulties in Integration: Experiencing technical and operational challenges when

integrating the CRM system with existing systems and workflows.

• Inappropriate CRM Solution Provider: Selecting a CRM provider that fails to meet
the organization's needs in terms of functionality, support, customization, and growth
capability.

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 Why CRM Fails – and How to Fix it?
• Publicly available data consistently show that 55% to 75% of companies fail to meet
the expected return on their CRM investments. So, have organizations
collectively wasted $150 billion on CRM during this period?
• Proper cost and project management

• Research suggests that the problem is relatively straightforward: Companies bought

sophisticated new relationship management resources, such as call centers, databases,
software and websites, but continued running their businesses as they always
had done and assumed that customers would value the results of their investments .
• Have strategy coupled with a well-defined set of requirements
 Why CRM Fails – and How to Fix it?
• CRM technology should enhance customer relationships, not just rely
on its tech.
– Effective use requires combining it with correct workflows, skilled staff, and
thoughtful management for impactful results.
• CRM technology aims to improve business efficiency and customer relationships,
but focusing only on sales metrics and KPI for example can waste its potential.
– A successful CRM centres on customer needs.
– Having customer need/ requirement at centre
– Balance between customer value and company value

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 Why CRM Fails – and How to Fix it?
• Choosing the wrong software and vendor
– Doing proper research
– Consultancy

• Most companies design their CRMs with only their current needs in mind.
– It is important to have plan for evolving

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 Why CRM Fails – and How to Fix it?
• Not having measurable matrixes in place
– Having matrix can lead to timely changes to the CRM itself, workflows, and even
training long before the CRM is at risk of failure.

• The problem is more fundamental: Most senior management teams have an

unbalanced approach to managing marketing investments, and this is particularly
evident in the case of CRM. They focus on the key resources in which they
invest capital, such as technology, location and advertising, but ignore the
commensurate investment of time, energy and talent to develop the
capabilities required to leverage those investments.
– No matter how you decide to roll out your CRM software, it is imperative that
you fully train your team
 Why CRM Fails – and How to Fix it?
• Our research suggests that successful CRM investment begins by
developing the new capabilities necessary to improve
customer relationships and then backfilling with capital investment,
as needed, to sustain and embed the capability development.
• …. To achieve this, companies must have the capabilities to
continually renew and configure resources in the service of
ever-changing customer needs.
 Ethical Concerns with CRM
• Data Privacy
• Data Security
• Accuracy of Data
• Customer Profiling and Segmentation
• Consent and Choice
• Transparency and Accountability
• Compliance with Laws and Regulations

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