vivek bohra iim projecton crm
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Summer Training Report
In
Datamatics Global Services
On
Customer Relationship Management
Submitted in partial fulfillment of the requirements of the twoyearPost Graduate Programme (PGP)
Submitted by
Vivek Bohra.
Roll No: PG20095063
Batch: 2009-2011
IILM Institute for Higher Education, Gurgaon
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Declaration
I hereby declare that the Project work entitled, Customer Relationship
Management submitted by me for the partial fulfillment of the Post
Graduate Program (PGP) to IILM Institute for Higher Education, is my
own original work and has not been submitted earlier either to IILM or to any
other Institution for the fulfillment of the requirement for any course of
study. I also declare that no chapter of this manuscript in whole or in part is
lifted and incorporated in this report from any earlier / other work done by
me or others.
Vivek Bohra (PG20095063)
Place :
Date :
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Acknowledgement
I express my heartfelt gratitude to Ms. Ankita Singh ( Manager- Coroprate HR : DatamatricsGlobal Services Ltd. Pune), for giving me the opportunity to undertake a project on CustomerRelationship Management under his guidance and observation.
I also express my deep sense of gratitude to my mentorDr. Sanyukta Jolly for her unflinching
support and making herself available for discussion and providing me as required facilities
whatever, whenever needed throughout duration of my dissertation.
Last but not least I would like to sincerely acknowledge the help received from various persons
and sources in collecting datas and information in completing this satisfactory Project.
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Executive Summary
As a part of my MBA curriculum I have done my summer internship training at Datamatrics
Global Service Ltd. In this report I am going to share my experience in the company.. I wassupposed to research on the status of CRM in India.
Deep customer relationships represent a continuing stream of income and a critical platform fornew growth. They also represent a powerful and defensible barrier to entry. Establishing and
strengthening long term relationship with your customers is the key to success. Its the focus of a
well structured and coordinated process of customer relationship management.CRM involves farmore than automating processes in sales, marketing and service and then increasing the
efficiency of those processes. it involves conducting interaction with customers on a more
informed basis and individually tailoring them to customers needs.
This project helps to gain a deeper understanding about how CRM can contribute towardsimproving the way you measure and optimize your relationships with customers.
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Contents
Company Analysis
Infrastructure
..8
Branch Network.9
Management Team..11
Groupclients13
Quality Policy..14
Group Synergies &Alliances17
Corporate social responsibilityinitiatives..19
Siebal CRMservices20
Chapter 1 (Conceptual Framework For CRM)
Key CRMPrinciples
.27 CRM
Activities29
Emergence Of CRMPractice..30
CRM FormationProcess.31
CRMPrograms..33
CRM ImplementationIssue.34
Chapter2 ( CRM & Related Concepts )
KM With Focus onCRM..36
Role Of CRM In Context Of SCM37
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ERP &CRM..37
Chapter 3 ( Technological Tools For CRM)
Tools38
Data Mining ForCRM.39
Existing CRMSolutions..40
CRM Model..41
eCRM42
Review & Assessment Of CRMSolutions43
Case Study 1 Implementing A Technology
Based CRM Solution The ICCI Experience.46
Chapter 4 ( Organizing For CRM)
AssessingNeeds 52
Employee Empowerment & CRM
Hewlett Packard (HP)
Case53
Chapter 5 ( Status OF CRM In INDIA)
Survey OF ServiceFirms56
ResearchObjective..56
Methodology.. 57
Analysis OF
Findings 57
Chapter 6 ( CRM In Select Services)
Customer Relationship Management AtAPTECH..64
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CRS..66
Financial Framework ForCRM70
CRM IN HMTL
.72
Refrences.. 75
Annexure.. 76
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Listening to customers must become everyones business. With most competitors moving ever
faster, the race will go to those who listen and respond more intently.
Tom Peters, Thriving on Chaos
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Conceptual Framework for CRM
Company profile
Datamatics is a global provider of intelligent, value-driven technology and business solutions.
These solutions span IT consulting, business process transformation, off-the-shelf technologysolutions and customized software services. They leverage our proven expertise in developing
technology to drive business efficiency and productivity.
Product innovation, IP-creation and technology collaboration form the core of our Company's
positioning as a 'one-stop-solution provider'. Datamatics has built up strong teams of Business
Analysts, Technology Architects, Delivery Experts, Quality Specialists and Marketing and Pre-
sales Professionals. These teams are geared up to provide solutions that are based on technologyplatforms that deliver competitive advantage to our customers.
Our domain and technology experts have integrated Artificial intelligence (AI) into many of thesolutions that Datamatics currently markets. For instance, AI has given i-Q, our path-breaking,
intelligent information processing solution, the capability to think like a human being, giving the
software intelligence and intuition. Besides AI, i-Q also conducts tree search and is capable ofpattern recognition, automatic learning, displaying confidence level of information located, auto
correction, and has Heuristics in hundreds of its components.
This success is being replicated across the organization, and solutions with similar features have
already been launched during the past year: i-Mask, i-Cat, i-Pub, i-Mark and i-
Clinic.
Mobile Serve , a web-based application for developing surveys on handheld devices, has been
tested and found to be highly-effective. Built on the latest technology, MobileServe givescustomers the power to conduct surveys using a range of mobile phones and PDA platforms.
With customers increasingly demanding solutions to improve operational efficiency, faster go-
to-market, higher employee productivity and maximized customer satisfaction, Datamatics has
focused on developing solutions to meet these market needs. Dartenium and e-PayablesManager are two such solutions. Dartenium is a high-productivity automation framework for
web testing. Similarly, e-Payables Manager is a configurable Web-based workflow system
specifically configured to cater to various Accounts Payable Functions. It is widely used by our
customers including many Fortune 100 companies. Its flexibility has helped many of ourcustomers in their initiatives to bring automation, visibility and agility to their Accounts Payable
process.
Datamatics Global Services has emerged as a leader in niche areas like embedded engineering
and telecommunications, having developed solutions for ticketing, toll and parking applications.
Such solutions have components that help manage user profiles better, and systems to maintaininventory and issue tickets, smart cards and discount coupons, and to configure vehicle type,
tariff and concessions, etc.
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http://www.datamatics.com/Forms/iQ.asphttp://www.datamatics.com/Forms/iQ.asphttp://dartenium.datamatics.com/http://www.datamatics.com/ePayablesManager.htmhttp://www.datamatics.com/ePayablesManager.htmhttp://dartenium.datamatics.com/http://www.datamatics.com/ePayablesManager.htmhttp://www.datamatics.com/Forms/iQ.asphttp://www.datamatics.com/Forms/iQ.asphttp://dartenium.datamatics.com/http://www.datamatics.com/ePayablesManager.htmhttp://www.datamatics.com/ePayablesManager.htmhttp://dartenium.datamatics.com/http://www.datamatics.com/ePayablesManager.htm -
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We continue to be driven by our vision To be a World Class Organization Admired for
Consistently Delivering Superior Business Value.
Infrastructure
For nearly three decades DFSL has invested in world class infrastructure capable of servicing
Indias expanding capital markets. Our offices provide an environment where employees can beat their productive best and ensure the highest service levels.
Located in the heart of Mumbai, Indias financial capital
Over 70,000 sq. ft. of state of the art facilities
40,000 sq. ft. of physical document library and retrieval facilities
Strong rooms as per RBI guidelines to store negotiable financial instruments & sensitivedocuments
Access controls across all facilities
Round the clock security provisions by trained staff
Branch Network
To ensure highest quality service and convenience to investors, DFSL has created a nationalnetwork of branches, Datamatics Investor Service Centers (DISC), in strategic locations across
India.
Staffed with friendly and helpful personnel, our branches provide various services
including:
Transaction requests
Service requests
Account queries
Statement of account generation
Complaint lodging and redressal etc.
Mumbai Nagpur Ahmedabad Indore
Jaipur Bangalore Patna Kolkata
Bhopal Raipur Ludhiana New Delhi
Chennai Visakhapatnam Baroda Kochi
Rajkot Lucknow Chandigarh Vijaywada
Mangalore Hyderabad
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Awards and Milestones
1975
The Incorporation of Datamatics.
1983
Pioneered Indias first offshore software factory by setting up a DedicatedOffshore Center for Wang Labs, USA.
1989
First company to establish a satellite link from its software development center in
India to AT&T Bell Labs, USA
1992
First Electronic Publishing Company in India.1995
Chairman, Dr. LS Kanodia, inducted into the Dataquest Hall of Fame... and
remains the only software professional to be thus honored.
1997
First in India and second in the world to obtain an ISO 9002 certification in
Electronic Publishing.
1998
First company in the world to guarantee a 99.997% accuracy level in data capture.
1999
Prime Minister of India confers the ESC Most Innovative Software Product
Award upon Datamatics Technologies.
2000
First Indian Technology Company to acquire controlling stake in a US listed data
management company (Saztec International).
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2003
First Indian company to scale up a dedicated facility into a Joint Venture in theBPO space via acquisition of CorPay for providing customized outsourcing
solutions for payables processing and other Finance & Accounting functions.
2004
First Indian non-voice third party BPO Company to get listed on BSE and NSE.
2006
Selected as Rising Star at 'The Global Outsourcing 100' 2006 Outsourcing WorldSummit.
2006
Among Top 50 best managed outsourcing vendors by 'The Black Book of
Outsourcing'.
2007
Winner of the IMC Ramkrishna Bajaj National Quality Award 2006.
2007
Ranked Third globally among global document process outsourcing providers by
'The Black Book of Outsourcing'.
2007
Winner of International Asia Pacific Quality Award. Becomes first and onlyIndian company to win the award in Services category, beating competition from
hundreds of companies across the services spectrum in countries such as the US,
Japan, Australia, Russia, Canada...
2009
Amalgamation of IT and BPO divisions complete.
Management Team
Dr L. S. Kanodia Chairman and Founder, Datamatics Group
Rahul L Kanodia Vice Chairman and CEO
Vidur Bhogilal Chief Financial Officer
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Sameer L. Kanodia Executive Director
Arvind Sirrah President, US
Dr. C M Dwivedi President and Global HR Head
Michael Thuleweit Managing Director, Datamatics GmbH (Germany / DACH)
Navin Anand President, UK / Europe
Ramkumar Akella Chief Operating Officer
TECHNOLOGY
At DFSL we believe that technology is a key enabler to significantly improve service levels and
guarantee customer delight. DSFL has nearly three decades of experience in the R&T businessand we leverage our experience to develop world class solutions to enhance our businessprocesses. We use contemporary software technology, state of the art infrastructure and periodic
BPR (Business Process Re-engineering) activities to make our processes efficient, our employees
more productive and continuously improve our service standards.
Software Overview
State of the art Transaction Processing and CRM software built on the Microsoft .Netframework
Back-end database on the latest Oracle 10g
Image based transaction processing to enable anytime, anywhere operations
Built in controls and validation to ensure error free transaction processing
Parameterized software, enabling customization to meet the unique requirements of
different scheme features of AMCs
System is capable of catering to high volumes of transactions
Complete integration of all transaction modules offers 360 degrees view of the Investor
All transactions can be tracked at every stage of processing from receipt to dispatch ofconfirmations
Flexible software architecture that can be integrated with software systems used by theAMCs and Distributors
AMCs and Distributors can get real time data feeds of transactions to keep their systems
and database always updated
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Data Center
International Standard Data Center that guarantees
o High Availability and Superior Performance leading to higher productivity andensure meeting clients SLAs
o Redundancy to ensure minimum downtime and no loss of data
o Security to protect our clients critical data and applications
o Scalability to be able to scale up our operations as per the requirements of the
client and upgrade to better technology as and when available
Physical security
o Biometric fingerprint scanners and secured card access
o High-security, tamper-proof cabinets with specially keyed locks
o Restricted access to server rooms and 24-hour on-site security staff
Group Clients
The Datamatics Group has partnered with top service providers from around the world to provideour clients an unmatched value proposition.
Partial List Of Clients
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Quality
Datamatics Quality Policy
Amongst only few ISO 9001:2000 certified R&T agents
4 quality layers for all transactions
o Maker accurate data capture from application form
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o Checker double data entry of critical fields and error corrections
o Auditor recheck all high value transactions, complex transactions from a
randomly generated pool
o Validation rule based systems validation of all transactions before final update
of records
Documented processes, guidelines & checklists for all service operations
Dedicated internal audit and QA team for all processes & critical outputs
Concurrent audits through external auditors
Jidoka - Quality check at every step of the process
Pokayoke Fail safe systems and processes
Kaizen - Continuous improvement
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GROUP STRENGTHS
DFSL is a part of the Datamatics Group of Companies. Through this association we are able tooffer our clients a holistic value proposition that is unique only to Datamatics. By associating
with DFSL, our clients establish a relationship with the Datamatics Group. The Datamatics
Group Value Proposition:
Datamatics Ltd (DL)
As the flagship company, DL is a pioneer in offshore development empowering clients with a
competitive edge through software solutions in numerous areas.
We are able to leverage DLs strengths in:
Best in class software solutions used in international financial services markets
Established software development processes
Continuous improvement to our technology based on international best practices andquality standards
Assured timely solutions
Expertise in Migrations
Datamatics Technologies Limited (DTL)
DTL is an end-to-end BPO service provider to the Electronic Publishing, Legal, Healthcare, and
Tax and Financial Accounting industry verticals.
We are able to leverage DTLs strengths in:
World class Data Management, Data Warehousing and Business Intelligence solutions
Association with companies such as File Net and Humming Bird for work flow anddocument management solutions
World class best practices in seamless business process migration
Proven ability to offer solutions such as Data Migration, Warehousing, Analytics,
Knowledge
Management and Enterprise Portal technologies to help client's build Enterprise-wideInformation Architecture.
Datamatics Staffing Services (DSS)
DSS is among India's leading recruitment organizations with over 1,300 person years experiencein recruitment consulting
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We are able to leverage DSSs strengths in:
Recruitment of quality and professional staff
Augment staff strength in a very short notice during busy periods
Industry best practices with respect to keeping motivation high and maintaining a low
attrition rate
GROUP SYNERGIES
We extract valuable group synergies to provide un-matched services to our clients
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ALLIANCES
Strategic Partners
Product Partners
Implementation Partners
PEOPLE
At DFSL our people are our greatest asset. We are proud of our staff and they are proud of
working with us. 400+ strong workforce
Lowest attrition rate: 8 %.
Minimum Entry Level: Graduation
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Domain expertise across various financial processes with dedicated teams of qualified
finance professionals
Dedicated legal team headed by a High Court lawyer to handle all legal aspects
Dedicated ISO and QA team to manage compliance
Training
We also inculcate a system of continuous training to ensure highest productivity. Employees
receive on going training on latest technology, processes and policies and most importantly on
providing exceptional customer service.
Corporate Social Responsibility Initiatives
Datamatics Global Services Limited has recognized the underutilized potential of the educated
and skilled physically-challenged professionals. Datamatics has provided such individuals anopportunity to contribute to the organization's growth while ensuring that they too benefit
through the Knowledge Associates (KA) programme.Datamatics has tied up with a non-governmental organization called NASSEOH (National
Society for Equal Opportunities for the Physically Handicapped) and Amar Seva Sangam where
nearly 60 physically-challenged individuals work as Knowledge Associates in the OutsourcingManagement Team. Apart from these, nearly 20 KAs work from home.
Through the KA programme, Datamatics has provided such individuals the satisfaction of being
financially independent, thus improving their status in society. The programme is tailor-made forindividuals who cannot commit themselves to full-time employment or travel any distance to the
place of work.
Datamatics has also enabled the NGOs to provide opportunities for the physically-challenged bydonating PCs to facilitate their IT set up. Trainers from the organization visit the NGOs and
homes of the KAs to conduct training and feedback sessions. In some instances, a mentor co-ordinator is stationed at the NGO for 3-6 months to co-coordinate training & hardware setup.
Application Management Services
The AMS team at Datamatics Global Services combines its multi-domain expertise with the
decades of experience in designing and deploying new applications that are robust, reliable and
scalable, modernizing legacy applications and giving existing applications the competitive edge.
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Datamatics AMS Solutions Framework
AMS Center of Excellence
Siebel CRM ServicesSiebel practice at Datamatics is well established and leverages our vast experience across various
industry verticals. We offer industry specific Customer Relationship Management (CRM)solutions to our customers and have proved our expertise in several Siebel implementations. Our
value added services include:
Siebel Testing
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Siebel Implementation
Siebel Customization
Siebel Maintenance
Siebel Support
Pre-packaged Siebel support
Siebel Pre-Implementation
Siebel Post-Implementation
Siebel Enhancements
Business process analysis
Implementation of Siebel
Customizations / enhancements and upgrade to current Siebel versions
Pre-packaged Siebel support and upgrade services
Our Siebel Center of Excellence support model can help organizations by:
Supporting and enforcing business and IT processes
Lowering support costs
Preserving knowledge assets
Enforcing quality standards
Some of the benefits that we have delivered to customers include:
Improved quality of service to end customers
Reduced costs by 40%
Increased responsiveness to end customer
Oracle ERP
Enterprise Resource Planning (ERP), Customer Relationship Management (CRM), and SupplyChain Management (SCM) are areas where Datamatics is engaged in providing solutions to
customers for a decade. We are one of the most preferred partners of Oracle's E-Business suite
for implementation, upgrade, maintenance, and support services. The most important factor in
our success is our objectives are closely aligned with our customers in addition to quality, lowerTCO (Total Cost of Ownership), and rapid implementation.
Our Oracle practice helps optimize an organization's investment through a complete set ofapplication life cycle management services.
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At Datamatics, we have created an Oracle Center of Excellence (CoE) to constantly improve our
services for customers. Oracle Center of Excellence focuses on upcoming Oracle technologies
and works on designing new tools and frameworks. Through the CoE, we are able to deliver
Predictable service levels to customers
Leverage global best practices
Provide access to a wider pool of talent
SAP ERP Services
Datamatics has a proven track record in providing services for the SAP package. We provide agamut of services that enable our customers to perform better:
SAP Application Support
SAP Testing
Enterprise Reporting Applications
SAP Application Implementation
Application Migration, Consolidation and Upgrade Services for SAP
Enterprise Application Integration Services ..
The proven benefits from this accelerated ASAP methodology include:
Reduced costs
Guaranteed quality and knowledge transfer
Improved efficiency in a shorter duration
Supply Chain Management Services
We provide complete business consulting and technical integration services for supply chain
management (SCM). . Our SCM technology practice provides expertise in solutions like JDA(formerly Manugistics) and SAP backed by experienced technical and functional consultants as
well as certified Domain experts.
We have a strategic alliance with JDA for implementations services. We have a dedicated
Software Development Center in India for developing / enhancing and creating client specificrequirements. We have completed over 50 implementations in different Business Segments inlast 5 years.
Our service offerings are:
Consulting and implementation services
Migration / Upgrade services
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Post implementation services
Business Process tuning
Education services
Testing services
Datamatics Funnel Methodology
Datamatics uses a funnel methodology to deliver a higher selection ratio. We set down
requirement analysis and job descriptions in association with clients. A team of 25 recruitmentspecialists together with technical experts then evaluates all candidates through multiple levels.
Only those who meet the criteria are forwarded to the client for final evaluation.
SAAS and SLA
The business potential of Software as a Service (SAAS) has exponentially increased in the last
few years. Organizations are today increasingly adopting the SAAS framework and see
significant value in it. We help customers in formulating solutions that ensure their SLAs arebuilt to have a positive business impact with SAAS. This includes precise definition of outages,
downtimes, components, resource availability among others. Thus we ensure that the entire
services suite is clearly defined by accurate definition of SLA terms. This clarity helps our
clients achieve optimum operational efficiency and increased ROI.
Portfolio Services
Datamatics offers the following Portfolio services:
Portfolio analysis
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Portfolio consolidation
Portfolio rationalization
Our customers have benefited in several ways from their engagements with us including:
Demonstrated expertise in portfolio management for International Organizations
Large pool of skilled and trained resources for portfolio analysis and strategies
Process based risk management matrix for portfolio
Optimize project risk and return with our in-house portfolio solution
Perform successfully in critical, large scope, size and complexity projects
Data Warehousing & Business Intelligence
Datamatics end-to-end consulting and implementation services can efficiently synchronize your
business data into a Global Data Repository or Enterprise Warehouse and help answer your mostdifficult business queries.
Information Strategy Planning & Road-map Consulting
Enterprise wide Data Consolidation and Warehouse Construction
Corporate level Information Delivery and Management Reporting
Proactive Data Warehouse Maintenance
Service Spotlight - DW Rescue Mission
Datamatics offers end-to-end services in Data Warehousing & Business Intelligence. Ourcompetence is reflected in our team of highly skilled and trained consultants, who have superior
technical, business consulting skills, domain expertise and project management skills.
We believe in our technological expertise & experience of successfully building integrated
Enterprise Data Warehouses (EDW) and Business Intelligence (BI) applications utilizing our
Global delivery model.
Information Strategy Planning & Road-map Consulting
How the data warehouse is going achieve Corporate-objectives
Identify Cross-functional Needs
Long-term vision of the warehouse
Create the technology plan
Identify & Select a toolkit and associated methods
Analyze, Prioritize and Target the needs
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Enterprise wide Data Consolidation and Warehouse Construction
Understand the business & work processes
Reference data through dimensional analysis
Design for usage while recording history
Develop and test the queries built and feed results for changes
Utilize various modeling techniques
Lift Off! Go live
Corporate level Information Delivery and Management Reporting
Trace and Grasp Reporting Environment
Create Reporting Plan
Setup Reporting level security hierarchy
Build and test management reports
Create iterative or automated report schedules
Proactive Data Warehouse Maintenance
Monitor the usage
Analyze and Adapt warehouse to meet current & future business needs
Align the warehouse with evolving business needs
Ensure each release supports the greatest needs of the business
Communicate the DW contributions
Service Spotlight DW Rescue Mission
Data Warehouse utilization assessment
Trace Problem Areas GAP Analysis
Corrective Planning to plot the user expectations
Align the warehouse to meet existing & future needs
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Chapter1 Customer Relationship management: an Overview
Before we begin to examine the conceptual foundations of CRM, it will be useful to define what
CRM is. A narrow perspective of customer relationship management is database marketingemphasizing the promotional aspects of marketing linked to database efforts.
Another narrow, yet relevant, viewpoint is to consider CRM only as customer retention in which
a variety of aftermarketing tactics is used for customer bonding or staying in touch after the sale
is made.
Shani and Chalasani define relationship marketing as an integrated effort to identify, maintain,
and build up a network with individuals consumers and to continuously strengthen the network
for mutual benefit of both sides, through interactive, individualized and value-added contacts
over a period of time.
The core theme of all CRM and relationship marketing perspectives is its focus on co-operative
and collaborative relationships between the firm and its customers, and/or other marketing
actors.
CRM is based on the premise that, by having a better understanding of the customers needs and
desires we can keep them longer and sell more to them.
Growth Strategies International (GSI) performed a statistical analysis of Customer satisfaction
data encompassing the findings of over 20,000 customer surveys conducted in 40 countries by
Infoquest.
The conclusions of the study were:
A Totally Satisfied Customer contributes 2.6 times as much revenue to a company as a
Somewhat Satisfied Customer.
A Totally Satisfied Customer contributes 17 times as much revenue as a Somewhat
Dissatisfied Customer.
A Totally Dissatisfied customer decreases revenue at a rate equal to 1.8 times what a TotallySatisfied Customer contributes to a business.
By reducing customer defection (by as little as 5%) will result in increase in profits by 25%
to 85% depending from industry to industry.
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An important facet of CRM is customer selectivity. As several research studies have shown
not all customers are equally profitable (Infact in some cases 80% of the sales come through
20% of the customers). The company must therefore be selective and tailor its program and
marketing efforts by segmenting and selecting appropriate customers for individual marketing
programs. In some cases, it could even lead to outsourcing of some customers so that a
company better utilize its resources on those customers it can serve better and create mutual
value.CRM is defined as:
Customer Relationship management is a comprehensive strategy and process of acquiring,
retaining and partnering with selective customers to create superior value for the company
and the customer.
Key CRM principles
Differentiate Customers: All customers are not equal; recognize and reward best customers
disproportionately. Understanding each customer becomes particularly important. And the same
customers reaction to a cellular company operator may be quite different as compared to a car
dealer. Besides for the same product or the service not all customers can be treated alike and
CRM needs to differentiate between a high value customer and a low value customer.
What CRM needs to understand while differentiating customers is:
- Sensitivities, Tastes, Preferences and Personalities
- Lifestyle and age
- Culture Background and education
- Physical and psychological characteristics
Differentiating Offerings
Low value customer requiring high value customer offerings
Low value customer with potential to become high value in near future
High value customer requiring high value service
High value customer requiring low value service
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High
Low
Low HighCustomer Value
Keeping Existing Customers
Grading customers from very satisfied to very disappoint should help the organisation in
improving its customer satisfaction levels and scores. As the satisfaction level for each customer
improves so shall the customer retention with the organization.
Maximizing Life time value
Exploit up-selling and cross-selling potential. By identifying life stage and life event trigger
points by customer, marketers can maximize share of purchase potential. Thus the single adults
shall require a new car stereo and as he grows into a married couple his needs grow into
appliances.
Increase Loyalty Loyal customers are more profitable. Any company will like its mindshare
status to improve from being a suspect to being an advocate. Company has to invest in terms
of its product and service offerings to its customers.
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Low value customers who
require high levels of service
must either purchase the higherlevel of service or become our
competitors low value/high
cost customers
ServiceRequir
ement
High value customers who
require a high level ofservice are maintained
without expanding the
costly offering to the entirecustomer population
Fig. 1 Customer value Service Matrix
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High
L
ow
*Focus On Short Term Profitability.
Spend Minimum Energy To Meet Your
Objectives.
#Dont Pursue.
Use Opportunity As It Comes.
Short Term Acquisition Shouldnt Affect
Long Term Image.
*Very cautious decision needed. Re-examine
business Plan & Strategy. Evaluate That
Your Loss (i.e. Your competitors gain)
Doesnt become nightmare for you.
#Needs In-depth strategic review as acquisition
alone and dissatisfaction later could be more
harmful
Low High
(Fig 2. Categorizing Customers)
Summarizing CRM activities:
The CRM cycle can be briefly described as follows:
1. Learning from customers and prospects, (having in depth knowledge of customer)
2. Creating value for customers and prospects
3. Creating loyalty
4. Acquiring new customers
5. Creating profits
6. Acquiring new customers
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1
Creating valuefor customers &
prospects
2Creating loyalcustomers
3
Acquiring new
customers
4
5
Creating
Profits
Learning from
customers a&
prospects
Fig.3
CRM Activities
*You have No Choice But To
Handle Them Very Carefully.
Will Consume Energy
# Think Of Innovative Ways of
Getting them On Your Side, ButThe Cost Of Acquisition Must Be
Controlled
StrategicIm
portanceToYourBu
siness
Plan
*Cultivate Relationship.
Spend Energy.
Go Out Of Your Way.
#Think Of Strategies TO Move Them
Away From Competition.Will Consume Disproportionately
High Energy.
Relationship & Profitability Potential
*ExistingCustomers
#Potential
Customers
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The Emergence of CRM Practice
The Past:
Looking back at a snapshot history of marketing, we can see the following clear developments
and progression over the last four decades:
1960s the era of Mass marketing, when Gibbs SR toothpaste began the first marketing
of this kind with its black and white campaign.
1970s saw the beginning of segmentation, direct mail campaigns and early
telemarketing (such as publishing)
1980s where Niche marketing made millionaires of those who were best at it.
1990s Relationship Marketing. The explosion of telemarketing and call centres, all set
up to develop relationships with customers. The recognition of the true value of retention
and the use of Lifetime Value as a business case.
In recent years however, several factors have contributed to the rapid development and evolution
of CRM. These include: -
1. The growing de-intermediation process in many industries due to the advent of
sophisticated computer and telecommunication technologies that allow producers to directly
interact with end-customers. For example, in many industries such as airlines, banks
insurance, software or household appliances and even consumables.
2. Advances in information technology, networking and manufacturing technology have
helped companies to quickly match competition. As a result product quality and cost are no
longer significant competitive advantages.
3. The growth in service economy. Since services are typically produced and delivered at the
same institution, it minimizes the role of the middlemen. .
4. Customer expectations are changing almost on a daily basis. Newly Empowered customers
who choose how to communicate with the companies across various available channels. Also
nowadays consumers expect a high degree of personalization.5. Emerging real time, interactive channels including e-mail, ATMs and call centre that must
be synchronized with customers non-electronic activities. The speed of business change,
requiring flexibility and rapid adoption to technologies.
6. In the current era ofhyper competition, marketers are forced to be more concerned with
customer retention and customer loyalty.
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7. As several researches have found out retaining customers is less expensive and more
sustainable competitive advantage than acquiring new ones..
8. The globalization of world marketplace makes it necessary to have global account
management for the customers.
CRM Formation Process
In the formation process, three important decision areas relate to defining the purpose (or
objectives) of engaging in CRM, selecting parties (or customer partners) for appropriate CRM
programs and developing programs (or relational activity schemes) for relationship engagement
with the customer.
CRM Purpose
32
Purpose
Increase
Effectiveness Improve
Programs
AccountManagement
Retention
Partners
Criteria Process
Role Specification
Planning Process
Process Alignment
Monitoring Process
Communication
Employee Motivation
Employee Training
Relationship
Performance
Strategic Financial
Marketing
Retenti
Evolution
Enhancement
Improvement
Fig 5. CRM Process Framework
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The overall purpose of CRM is to improve marketing productivity and enhance value for parties
in involved in the relationship. By seeking and achieving operational goals, such as lower
distribution costs, streamlining order processing and inventory management, reducing the burden
of excessive customer acquisition cost, and through customer retention economics, firms could
achieve greater marketing efficiencies. They can enhance marketing effectiveness by carefully
selecting, customers for its various programs, individualizing and personalizing their market
offerings to anticipate and serve the emerging needs of individual customer, building customer
loyalty and commitment, partnering to enter new markets and develop new products, and
redefining the competitive playing field for their company. Thus, stating the objectives and
defining the purpose of CRM in a company helps clarify the nature of CRM programs and
activities that ought to be performed by the partners. Defining the purpose would also help in
identifying suitable relationship partners who have necessary expectations and capabilities to
fulfill mutual goals.
Relational Parties
In the Initial phase, a company has to decide which customer type and specific customers or
customer groups will be the focus of their CRM activities.
CRM Programs
A careful review of literature and observation of corporate practices suggest that there are three
types of CRM programs: continuity marketing; one-to-one marketing; and, partnering programs.
These take different forms depending on whether they are meant for end-consumers, distributor
consumers, or business-to-business customers.
.
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Customer Types
Program Types
Mass Markets Distributors Business to
Busine
ss
Markets
Continuity Marketing After- Marketing
Loyalty Programs
Cross-Selling
Continuos
Replenishment
ECR Programs
Special
Sourcing
Arrangements
One-to-One Marketing Permission Marketing
Personalization
Customer Business
Development
Key Account
Global
Account
Partnering/Company-
Marketing
Affinity Partnering
Co-Branding
Logistics Partnering
Joint Marketing
Strategic
Partnership
Co-Design
Co-Develop
Table 1 presents various types of CRM programs developed for different types of
customers
CRM Programs
Continuity Marketing Programs
Take the shape of membership and loyalty card programs where customers are often rewarded
for their member and loyalty relationships with the marketers. The basic premise of continuity
marketing programs is to retain customers and increase loyalty through long-term special
services that has a potential to increase mutual value through learning about each other.
One-to-one Marketing
Meeting and satisfying each customers need uniquely and individually. In the mass markets
individualized information on customers is now possible at low costs due to the rapid
development in the information technology and due to availability of scalable data warehouses
and data mining products.
Partnering Programs
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The third type of CRM programs is partnering relationships between customer and marketers to
serve end user needs. In the mass markets, two types of partnering programs are most common:
co-branding and affinity partnering.
CRM Performance Evaluation Process
Without a proper performance metrics to evaluate CRM efforts, it would be hard to make
objective decisions regarding continuation, modification, enhancement, or termination of CRM
programs.
Another global measure used by firms to monitor CRM performance is the measurement of
relationship satisfaction. By measuring relationship satisfaction, one could estimate the
propensity of either partys inclination to continue or terminate the relationship. Such propensity
could also be indirectly measured by measuring customer loyalty.
CRM Implementation Issues
One of the most interesting aspects of CRM development is the multitude of customer interfaces
that a company has to manage in todays context. Until recently, a companys direct interface
with the customers, if any was primarily through sales people or service agents. In todays
environment most companies interface with their customers through a variety of channels
including sales people, service personnel, call centres, Internet websites, marketing departments,
fulfillment houses, market and business development agents,. For example, a customer who just
placed an order on the Internet and subsequently calls the call centre for order verification
expects the call centre staff to know the details of his or her order history. Similarly a customer
approached by a sales person unaware that she has recently complained about dissatisfactory
customer service, is not likely to be treated kindly by the customer.
However, the challenge is to develop and integrated CRM platform that collects relevant data
input at each customer interface and simultaneously provides knowledge output about thestrategy and tactics suitable to win customer loyalty and support. If a call centre personnel cannot
identify or differentiate a high value customer and does not know what to up-sell or cross sell to
him then it would be a tremendous loss of opportunity for the company. Although most CRM
software solutions based on relational databases are helping share customer information, they
still do not provide knowledge output to the front line personnel. As shown in Figure.6, CRM
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Knowledge
Output
Knowledge
Output
Knowledge
Output
Knowledge
Output
Knowledge
OutputData Input
Data Input
Data Input
Data Input
Data Input
solutions platform needs to be based on interactive technology and processes. It should assist the
company in developing and enhancing customer interactions and one-to-one marketing through
the help of suitable intelligent agents that help develop front-line relationship with customers.
Figure 6 . Information Platform for CRM
Since CRM implementation comprises a significant information technology (IT) component,
these companies have handed over the responsibility of CRM implementation to information
technology departments. They are focussed on simply installing CRM software solutions without
a CRM strategy or program in place. The lack of CRM strategy or CRM programs, would leave
the front-line people without any knowledge of what they should be doing with the additional
customer information that they now have access to. From a corporate implementation point of
view, CRM should not be misunderstood to simply mean a software solutions
implementation project.
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Sales Group
Market
Development
MarketingCustomer
Operations/
Service
Call Centre
Internet
KnowledgeOutput
Data Input
Integrated Marketing
Information Platform
Information Content
Relational Databases
Decision Support System
Active IntelligenceBusiness Rules
Collaborative Communication
User Profiles
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Chapter 2: CRM and Related Concepts
Knowledge Management (KM) with focus on CRM
As Peter Drucker defined Information is data endowed with relevance and purpose.
To effectively implement a CRM solution it is very important to identify real knowledge about
different types of customers (Viz. Most valued customers, Most grow able customers, Below
zero customers) from plethora of internal and external data, figures, surveys, etc. A straightway
technique is to create a data warehouse, thereafter information which is required to effectively
implement principles of CRM, could be mined out of this data warehouse.
Marketing, sales after-sales people would be knowledge workers. Front office could be more
productive if they could utilize customer knowledge.
Metrics, ROI, Balance Scorecard method, benchmarking are some of the common technique
of KM system evaluation. KM implementation is the key to CRM.
Its a proven fact that 80% of organization revenues come form 20% of its customers; it becomes
imperative to design CRM solutions keeping in mind these most valuable customers and to
leverage 80% non structured data of about 20% of these most valuable customers.
Just as more tangible corporate assets like computer systems have a finite shell life, so too does
knowledge, it must be available at the right time to be able to act upon it. Retaining tacit
knowledge (derived from experiences, data and documents) means retaining the individual,
which is invariably not possible. It is possible to generate explicit knowledge from tacit
knowledge, but its a complex exercise. The key ingredient of this exchange is face to face
sharing of knowledge or virtual environmental tools like Lotus Notes, which can facilitate tacit
knowledge exchange. The choice of Customer Knowledge Management (CKM) architecture
should have a layered approach. Existing systems should be seamlessly linked with the proposed
layer. The choice for CKM system could be Web (Enterprise information portal) or a packaged
solution such as Lotus Notes, Microsoft solution.
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Role of CRM in the Context of SCM
In the context of SCM, where alliances and partnerships are keys to success, CRM plays an
important role in building long-term relationships. Apart from the end-users, it involves internal
employees, channel members and other external entities such as advertising agencies and
consulting organizations. The success of relationships depends upon sharing of savings from the
supply chain, which may be reinvested to further enhance its efficiency, and sustain the
competitive advantage.
The supply chain of tomorrow will look like a virtual organization, seamlessly integrated through
sharing data and savings as well. The bonding between partners will be closely held by CRM
practices.
ERP and CRM
Like ERP, CRM solutions focus on automating and improving business processes, albeit in
front-office areas such as marketing, sales, customer service, and customer support. Whereas
ERP implementation can result in improved organizational efficiency, CRM aims to provide
organizational effectiveness by reducing sales cycle and selling cost, identifying markets and
channels for expansion, and improving customer value, satisfaction, profitability, and retention.
While CRM applications provide the framework for embodying, promoting and executing best
practices in customer facing activities, ERP provides the backbone, resources and operational
applications to make organizations more efficient in achieving these goals.
Regain Management
The cost of acquiring a new customer is 9 to 12 times that of holding on to an existing
customer.-Philip Kotler
Consumer Life Time Value
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Quantifying the value of customers is absolutely essential in regain management. In fact, the
percentage of profit a company makes from continued sales to its own customer base is
consistently higher than the profit made on original sale.
Chapter 3: Technological Tools for CRM
Tools
Customer database
A good customer information system should consist of a regular flow of information,
systematic collection of information that is properly evaluated and compared against different
points in time, and it has sufficient depth to understand the customer and accurately anticipate
their behavioral patterns in future. The customer database helps the company to plan,
implement, and monitor customer contact. Customer relationships are increasingly sustained
by information systems. Companies are increasingly adding data from a variety of sources to
their databases. Customer data strategy should focus on processes to manage customer
acquisition, retention, and development.
Other Technologies that are used are as follows:
Electronic Point of Sale(EPOS)
Sales Force Automation
Customer Service Helpdesk
Call Centers
Call Centre helps in automating the operations of inbound and outbound calls generated between
company and its customer. These solutions integrate the voice switch of automated telephone
systems (e.g. EPABX) with agent host software allowing for automating call routing to agents,
auto display of relevant customer data, predictive dialing, self service Interactive Voice
Response systems, etc.
Systems Integration
While CRM solutions are front office automation solutions, ERP is back office automation
solution. An ERP helps in automating business functions of production, finance, inventory, order
fulfillment and human resource giving an integrated view of business, where as CRM automates
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the relationship with customer covering contact and opportunity management , marketing and
product knowledge, sales force management, sales forecasting, customer order processing and
fulfillment, delivery, installation, pre-sale and post-sale services and complaint handling by
providing an integrated view of the customer. It is necessary that the two systems integrate with
each other and complement information as well as business workflow. Therefore, CRM and ERP
are complementary. This integration of CRM with ERP helps companies to provide faster
customer service through an enabled network.
CRM A FRAMEWORK
Data Mining for CRM: Some Relevant issues
Data mining is an important enabler for CRM. Advances in data storage and processing
technologies have made it possible today to store very large amounts of data in what are called
data warehouses and then use data mining tools to extract relevant information. Data mining
helps in the process of understanding a customer by providing the necessary information and
facilitates informed decision-making.
Operational CRM solutions involve integration of business processes involving customer touch
points. Collaborative CRM involves the facilitation of collaborative services(such as e-mail) to
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Traditional Approach to CRM
Customer Contact by
Telephone
Mail
In Person
Personal Selling
After Sales Service
Complaint Handling
Account Management Customer care
Customer Satisfaction
Web-Enabled & Integration
Approach
Customer Information
System
Customer Database
Electronic Point of Sale
Sales Force Automation
Automation of Customer
Support
Call Centres Systems Integration
Lifetime value of a Customer
Integration with
technology
(Web & Internet)
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facilitate interactions between customer and employees. All this effort produces rich data that
feeds the Analytical CRM technologies.
Information Requirements Of An Effective CRM Solution
The existing CRM Solutions
Delivering the 360 view requires automation to bring together all the data concerning a
customer. This implies the organization has to change from:
Mass Marketing Product Focus
Product Focus Customer Focus
Economies of Scale Economies of time
1 way communication Interactive
Response Time Real Time
Present CRM Alternatives
Present CRM solutions are offered by host of vendors that are to a great extent not industry
specific. While there are some vendors, who have come up with industry specific solutions, the
broad model around which the CRM solutions are built remain the same. Adopting a similar or a
look a like solution across industries is what causes major strain in servicing a customer.
Typical offerings of the current CRM solutions (such as Siebel, Oracle Apps or MySap.com, etc)
vary from solution to solution. However typical CRM offerings consist of:
41
Operational CRM Collaborative CRMAnalytical CRM
Customer
Fig.8 Interactions between CRM Technologies
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Customer Development Field sales, Tele sales, Internet Sales
Service Centre Call Centers, Field Service
Sale management and support Internet Customer Service
Market Analysis Service Interaction Centre
Internet, Tele marketing Business Partner Collaboration
Product and brand management
The Customer focused organization: CRM Model
The idea here is to develop systems that allow flexibility, work on not completely predefined
processes so as to enable front office to be proactive to each customer needs
The Mindset impact on CRM
A typical data warehouse will have the following components:
While developing a data warehouse one takes into account all the legacy and operation
systems. But typically sales teams could be managing leads on an excel worksheet. Sometimes
critical DSS input like Profitability Analysis itself may reside on a worksheet.
eCRM
What is eCRM?
42
OLAP Tool
Risk
Cube
F P & A
Cube
Mktg &
Sales Cube
Campaign
Mgmt
Data
Warehouse
Legacy & OperationExtract & Transfer
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eCRM provides companies with means to conduct interactive, personalized and relevant
communications with customer across both electronic and traditional channels. It utilizes a
complete view of the customer to make decisions about messaging, offers and channel delivery.
It synchronizes communication across otherwise disjoint-customer facing systems. It adheres to
permission based practices, respecting individuals preferences regarding how and whether they
wish to communicate with you and it focuses on understanding how the economics of customer
relationship affect the business.
eCRM Vs CRM
CRM is essentially a business strategy for acquiring and maintaining the right customers over
the long term. Within this framework, a number of channels exist for interacting with customers.
One of these channels is electronic and has been labeled e-commerce or e-business. This
electronic channel does not replace the sales force, the call Centre, or even the fax. It is simply
another extension, albeit a powerful new one, to the customer. The thrust of eCRM is not what
the organization is doing on the web but how fully the organization ties its on-line channel
back to its traditional channels, or customer touch points.
Why employ eCRM?
Companies need to take firm initiatives on the eCRM frontier to
Optimize the value of interactive relationship
Enable the business to extend its personalized reach
Company-ordinate marketing activities across all customer channels.
Leverage customer information for more effective emarketing and ebusiness
Focus the business on improving customer relationship and earning a greater share of each
customers business through consistent measurement, assessment and actionable customerstrategies.
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Review and Assessment of CRM solutions
CRM software applications embody best practices and employs advanced technologies to help
organizations achieve these goals.
Categories of CRM solutions
Any enterprise, which wants to implement CRM solutions, can choose from four categories of
solutions
Integrated applications suite
Interfaced applications bundle
Interfaced best of breed solutions
Best of cluster
Key requirements for CRM solutions
Some of the functional and technical requirements for CRM solutions are as listed below:
Business intelligence and analytical capabilities
Unified channels of customer interactions
Support for web based functionality
Centralized repository for customer information
Integrated work flow
Integration with ERP applications
Functional Components of CRM solution
CRM applications are a convergence of functional components, advanced technologies and
channels. Functional components and channels are described below:
Sales applications
Common applications include calendar and scheduling, contact and account management;
compensation; opportunity and pipeline management; sales forecasting; proposal generation and
management; pricing; territory assignment and management; and expense reporting.
Marketing applications
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SIEBEL
It continues to out market and out sell the competition. It is one of the few front office suite
vendors having vertical specific functions. Its functionality is compelling. It can be integrated
with most of the back office solution like SAP and Oracle. The solutions for the verticals
described above are discussed below:
For Consumer goods: a Siebel eConsumer goods offers eBusiness solution spanning the
entire demand chain from the end consumer, through the retailer and the wholesaler, to the
manufacturer. It has robust trade promotions planning functionality allowing users to
manage customer promotion plans and the funds to support them, while comprehensive
route planning functionality enables integrated account targeting.
For Financial Services: Siebel eFinance enables banking, brokerage, insurance, and capital
market organizations to establish and maintain long term profitable relationship with
consumers, small businesses, and corporate customers. The organizations can capitalize on
information captured during each customer interaction to more effectively cross-sell and up-
sell additional products and services.
For Healthcare: Siebel eHealthcare gives organizations the ability to streamline and
improve sales, member services, medical management, and network management services.
By using multiple distribution channels, including the Internet, call Centers, home office
staff and independent brokers, Siebel eHealthcare provides organizations with a single view
of their customers, thereby ensuring better service and improved quality of care.
For telecom service providers: Siebel eCommunications helps wireless, cable, and
Internet service providers to target and win the right customers, accelerate service delivery,
and provide service across all touchpoints. Siebel eCommunications embodies the industrys
best practices for generating accurate service orders, managing billing inquiries and
adjustments, and up-selling and cross-selling additional services
Some of Siebel employee-facing applications are:
Some of Siebel customer-facing applications are:
Some of the additional productsavailable in version 6.0
Siebel Call Center Siebel eChannelSiebel eBusiness Connector for SAP R/3
Siebel eMail Response Siebel eCustomer Siebel Communications Server
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Siebel Field Service Siebel eMarketing Siebel Distance Learning
Siebel Marketing Siebel eSales Siebel Global Enterprise Support
Siebel Sales Siebel eService Siebel Language Extensions
Siebel Service Siebel Wireless
Clarify
It offers customer service & support and field service suite; however its sales functionality is
immature.
Oracle
Oracle is betting everything on its thin, Web Based, centralized computing model. The Internet
computing architecture is compelling for connected non-mobile users; Oracle is rebuilding
functionality on the new platform and integrates its various acquired products. It offers a broad
set of functionality across e-commerce, front office and business intelligence applications.
Vantive
Vantive offers a compelling customer service and support and field service suite. The rest of its
front office functionality makes it suite more of a bundle. The solution is integrated with
PeopleSoft at the back office.
Table 2 Comparative Assessment of CRM Products for Vertical Specific Requirements
CRMApplicationRequiremen
tSiebel Clarify Oracle Vantive
Consumer Products
Category Management Available Available Available Available
Promotion Management Available Available Available Available
Demand Planning Available N.A. Available N.A.
Interactive Selling Available Available Available Available
Telecom Service Providers
Blended Sales & service contact
CentreAvailable Available Available Available
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Competitive Pricing Analysis N.A. N.A. N.A. N.A.
Integration with Billing System Available Available Available N.A.
Churn management Available Available Available N.A.
Commercial Banking
Contact Centre Available Available Available Available
Profitability Analysis Available Available Available Available
Integrated Targeting N.A. N.A. Available N.A.
Marketing Datamining N.A. N.A. Available N.A.
Pharma & Healthcare
Contract Management Available N.A. Available N.A.
Marketing AnalysisN.A. Available N.A. N.A.Disease Education System Available N.A. N.A. N.A.
Knowledge Management System Available Available N.A. Available
Case Study 1: Implementing a Technology- Based CRM Solution
The ICICI Experience
ICICI set up as Development Bank over four decades ago to provide products and services for
the corporate segment, diversified into the retail segment of the financial markets in the early
1990s.
In 1994, it established ICICI bank as a commercial bank that is flexible, innovative and prompt
in meeting customer requirements. In addition to the bank, the retail initiatives include Prudential
ICICI AMC, ICICI Personal Financial Services, ICICI Capital Services, and ICICI web trade,
Prudential ICICI Life Insurance, ICICI Lombard General insurance. This apart the retail
initiatives also include a plethora of web based businesses including city portals and various
other utility sites such as billjunction.com, icicimoneymanager.com, and magiccart.com, among
others.
The Retail Strategy
As part of plans, it is implementing various projects to establish world class CRM practices,
which would provide an integrated view of its customers to everyone in the organization. CRM
at ICICI involves increased communication between the virtual universal bank and its customers
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and prospects, as well as within the group itself. The underlying idea is to enhance every instance
of contact with the customer. ICICI believes that a true customer centric relationship can only be
accomplished by considering the unique perspectives of every single customer of the
organization. Hence the pressing need to put in place a technology enabled CRM solution.
The CRM Roadmap
CRM, at ICICI, is viewed as a discipline as well as a set of discrete software technologies, which
will focus on automating and improving the business processes associated with the customer
face to-face, call Centre, ATM, web, telephone, kiosk, bank branch, sales associates, etc so as
to allow ICICI to carry out cradle-to-grave customer management more efficiently. It should
allow ICICI to engage in one-to-one marketing by tracking complete customer life-cycle history.
To begin with it will automate process-flow tracking in the product sales process, and be able to
generate customized reports and promote cross selling. It will also enable efficient campaign
management by providing a software interface for definition, tracking, execution, and analysis of
campaigns..
Implementing CRM
A very detailed and comprehensive CRM action plan was developed based on the understanding
that CRM will require enterprise wide transformation.
The CRM Business Transformation Map below shows the various aspects of that change.
Product Sales Channel Marketing Service Customer
Product
Management
Place
Management
Promotion
Management
Channel
Management
Contact
Management
Customer
Management
Product
Performance
Place
Performance
Program
Performance
Customer
Revenues
Customer
Patterns &
Profitability
Customer
Lifetime Value
and Loyalty
Mass Sales Marketing Integrated Marketing Segment
Specific
CRM
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BUSINESS FOCUS
ORGANISATIONAL STRUCTURE
BUSINESS METRICS
MARKETING FOCUS
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Advertising Promotion Campaigns Communications Marketing
Transaction
Processing
Data
Maintenance
Data Access Data Warehouse Data Marts Customer
Touchpoint
Systems
Interviews with key individuals throughout the organization helped identify different initiatives
that have been launched, all focused on CRM.
The next step in the planning process was a Gap Analysis. This analysis essentially compared
current stage against optimal relative to the five aspects of business, to identify and specifically
describe the gaps.
The CRM Business Cycle:
Understand and Differentiate
Organizations cannot have a relationship with the customer unless they understand them what
they value, what types of services are important to them, how and when they like to interact, and
what they wan to buy. True understanding is based on a combination of detailed analysis and
interaction.ICICI groups customers need to see that the company is differentiating service and
communication based on both what they have learned independently and on what the customer
has told them. At the same time, differentiation should be based on the value customer are
expected to deliver.
Develop and Customize
ICICI believes that the extent of customization should be based on the potential value delivered
by the customer segment.
Interact and Deliver
ICICI is strongly of the opinion that value is not just based on the price of the product or the
discounts offered. In fact, customer perceptions of value are based on a number of factors
including the quality of products and service, convenience, speed, ease of use, responsiveness,
and service excellence.
Acquire and Retain
The more ICICI learns about customers, the easier it is to pinpoint those that are producing the
greatest value for the organization. Successful customer retention basically involves getting it
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right on an ongoing basis. And that is exactly what ICICI group aims to achieve out of its
CRM initiatives.
Successful customer retention is based very simply on the organizations ability to constantly
deliver on three principles:
Maintain interaction; never stop listening to customers
Deliver on customers value definition. Remember that customers change as they move
through differing life stages; be alert for the changes and be prepared to modify the service
and value proposition as they change.
Creating an Action Plan
The next step in the planning process was the development of a very detailed action plan.
While the complete plan might span three or more years, it was based on three-month
phases with clear deliverables that will demonstrate both progress and quick hits or
measures of success. The plan identified interdependent activities and should
comprehensively detail the time and resources required for each activity.
Another key factor for the planning process was the Leadership Action Plan. Advancing
on the CRM transformation map required significant organization change. This part of
the action plan helped assess the drivers and restraints of change and the organizations
readiness to assess the change.
Selecting and Implementing a Technology Based Solution
Technology
The success of the CRM initiatives was contingent on various decisions pertaining to technology.
Some of the key issues were: -
(a) Make or Buy: - The decision to buy was based on an evaluation of an identified set of
criteria. Some criteria were Functionality, Flexibility, Scalability, Fit with existing
architecture, etc. was decided to purchase an off-the-shelf CRM solution and customize it to
suit ICICIs requirements.
(b) From whom to buy: Some Criteria included were CRM expertise, Retail Finance Experience,
Credentials including financials, client list, life history, etc. A detailed Request for
Information (RFI) was sent to each of the shortlisted companies. After receiving the RFIs,
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another round of evaluation was done. After short listing two product vendors and system
integrators, reference calls were made to several of the past clients of all shortlisted
companies.
Processes
All processes were mapped on to product by understanding the details. During the course of the
process mapping, several opportunities for improvement were identified and implemented.
The Sales Process Pre CRM and Post Implementation of CRM
Lessons so far from the ICICI experience
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Call Centre Sales Agent Scrutiny Credit Agent Operations
Independent Databases
Database
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If CRM involves optimizing product, price, place of distribution, promotion, sales and service,
why are so many companies struggling? Hasnt anyone really mastered the art and science of
CRM, and if not, why is it so difficult?
CRM is difficult because it is an enterprise wide initiative.
CRM is not a technology initiative. Many have confused CRM as a technology initiative, and
assigned the CRM implementation project to their information system or information
technology group. CRM conferences often equate to technology exhibits and demonstrations.
Technology is needed in order to implement CRM particularly the customization part but
technology is not the driver of CRM, or the solution to successful CRM implementation.
CRM is not exclusively a marketing initiative. Many organisation have merely equated CRM
with customer focused marketing, or data-driven/database marketing. CRM results in more
effective, data driven marketing efforts; CRM requires marketing experience. But CRM is
strictly not a marketing initiative.
CRM is not exclusively a sales initiative. Similar to marketing, CRM is often lodged within
the sales department. The sales-force, after all, is extremely close to their customers
understanding their needs and wants., and trying to fulfill them. Sales, however, is just one
functional area that can benefit from CRM, and that is necessary for effective CRM.
Chapter 4: Organizing for CRM
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Assessing Need
How do you know your business requires CRM?
It is very easy for a business to get caught in the latest customer trap when it is being driven bythe information technology (IT) market. Every business does require CRM; the question is to
what level?
Trends
Many businesses are pushed by the current trend to change their business strategy, especially
around CRM. There are basically three trends that effect a business:
Consumer
The customer is an ever-changing image, to be really successful with CRM you must recognize
the customer trends that are effecting the business.
If a business does not understand a customer profile and the changes that have occurred then it is
not possible to provide true customer relationship management.
Products
It is the business providing the products that meet the changing customer trends. Products need
to be reviewed constantly perhaps enhanced or even removed. Supermarkets are a perfect profile
to look at for viewing product trends, they constantly add and remove products and they
constantly view customer buying profiles and set out the pattern of the store to meet the strongest
buying trend. This may not always be by using the latest technology, it could be by just
reviewing shells at the end of the day, but the super market is at the minimum watching for the
two basic trends in CRM.
Technology
Ensure that the business is ready to install the new technologies, is the customer data upto it, or is
it time to start again? Do you need to review every technology being used or just one area. Will it
assist the business, is it going to grow with the business requirements or is the technology just
another trend? Relationship management should not be an alternative to existing
functions/technology; it could be a logical extension to enhance those in existence, though it
could radically change some of the operational processes.
Is your Business ready? Are your customers Ready?
What are the costs, monetary, time, people and long-term issues?
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Does CRM really matter?
Whatever the business activity is all companies have to ask themselves is CRM the real factor for
their company to succeed. Some customers do not need long-term relationship with their
suppliers; therefore only minimal information is required from that customer. That however is
still a form of CRM. Other companies have high quality and high value customers that they need
to know information about, they need to provide exceptional service, the pedigree of CRM.
Whatever the business is, if it has customer it has to ask, does customer relationship management
matter? What does it man to them in business terms? At what cost? What is the overall loss if not
adhered to?
CRM: Yes it does really matter the strategy needs to last, be constantly reviewed and can
evolve over time.
Employee Empowerment and CRM
The Case of Hewlett-Packard India
Relationship between Employee Satisfaction, Customer Satisfaction & Market Share
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Market
Share
Productivity
Customer
Satisfaction
Cost Of
Quality
Employee
Satisfaction
Satisfaction with
Right Skills
Satisfaction
With Manager
Job
Satisfaction
-ve
-ve
MarketShare
40%ESS
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1990 91 92 93 94 95 96 97
Initiatives for Employee satisfaction
A demotivated, unenthusiastic and unhappy employee will never care for the customers. Also
organizations willing to spend money when they are doing well should spend on employees more
rather than less when things get bad. An employee satisfaction survey should be carried out on a
regular basis.
Hewlett Packard (HP) Case
HP sells its products through its channels. Whenever the customer purchases a product, and there
is an issue to be resolved, the point of contact is the front line team. It handles the usage-related,
the application related and the real product related issues. The backend team handles the up
gradation issues. The partners provide the hardware support. The sales and services are provided
by DPSPs and the ASPs only. Typically in a month, the total number of customer calls logged
in at HP is 21,000 out of which 4600 are through web support, 1270 e-mails and 15,000
telephone calls. They use automated call distribution software, which also enables to track the
particular history of the customer. The service providers are assessed continuously. It is a
challenge to motivate engineers who are the employees of the service providers and are not HP
employees. The engineers/service providers performance is monitored on:
Turnaround Time
Number of parts requested per call (Multiple Part consumption)
Closing the call
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25%
35%
30%
CSS
CSS ESS Market Share
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Customer satisfaction
Repair rate
Effective handling of customer escalations
HP has allocated points for each of these parameters for partner performance measurement. In
case the partner performance falls below the desired level of points, then there would be
deduction in the reimbursements of that reseller. However if he exceeds the given point scale
then he qualifies for additional reimbursements which are offered as rewards.
HP contacts all customers, who are not happy with the service, and through the partners it is
attempted that certain steps are taken so that the customer is happy. The training program for the
partner is also regularly revived.
There is also a Reward 1000 plus program where there are points awarded. There are points for
various aspects such as training, quiz bulletin, customer feedback, customer service, re-repair
rate. The top contributors among the resellers are identified and are sent for training or
entertainment apart from monetary incentives.
So at HP, there is synchronization of the employee satisfaction and customer satisfaction process
to ensure a higher market share.
Chapter 5: Status of CRM In India
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A Survey of Service Firms
Successful implementation of CRM requires a strategic approach, which encompasses
developing customer centric processes, selecting and implementing technology solutions,
employee empowerment, customer information and knowledge generation capabilities to
differentiate them, and the ability to learn from best practices.
Research Objectives
The current research was aimed at determining the approach being adopted by businesses in
India for relationship marketing. The research focused on the following major issues:
Do managers in service firms believe that their processes are customer centric?
Do they select technology on the basis of an understanding of customer needs?
Have they empowered their employees to deliver superior services?
Do they have a customer knowledge strategy? How well do they manage their customer
relationships?
Methodology
The research was exploratory in nature and adopted a two-stage process. During the first stage,
50 managers of service firms operating in India were surveyed through respondent administered
questionnaires. These managers belonged to the following three categories:
a) Hospitality Industry encompassing hotels and restaurants
b) Information technology and
Telecom industry which
included software firms and
telecom providers
c) Financial Services included
commercial banks andmutual funds
The survey focused on the quality and the customer centric processes, technology selection,
employee empowerment, and customer knowledge strategy to gauge the status of CRM practices
in these firms.
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I.T &Telecom
36%
Finance
35%
Hospitality
29%
Respondent Profile
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In the second stage, managers of select firms in each category of services were interviewed to
understand the relationship marketing practices adopted by them. These interviews explored the
following issues:
1. What are the various CRM initiatives undertaken by the firm?
2. How do they develop these programs?
3. How do they measure the effectiveness of these programs?
4. How successful are these programs in retaining customers?
Analysis of Findings
Processes
The managers reported a wide divergence with respect to the adoption of quality assurance
across the three sectors. The I.T and telecom sector is at the forefront of adopting a formal
quality management organization. Most of the players in the hospitality and the finance sector
report having some methods in place to ensure quality management initiatives. About 8% of the
overall sample have indicated the absence of any quality initiatives in their organizations.
At the broad level, most managers believe that they understand most of the interactions between
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0%
48%52%
4%
35%
62%
15%
50%
35%
0%
10%
20%
30%
40%50%
60%
70%
Some Most All
Finance Hospitality I.T & Telecom
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customers and their business processes. About 50% of them have indicated that they have a full
understanding of all possible interactions between customers and their business processes.
Customer-centric marketing emphasizes understanding and satisfying the needs, wants, and