Chapter 1: Introduction to Microsoft Dynamics CRM

CHAPTER 1: INTRODUCTION TO MICROSOFT DYNAMICS CRM

Objectives
The objectives are: Understand the benefits of using Microsoft Dynamics CRM to support a CRM strategy. Identify the functionality and purpose of the Microsoft Dynamics CRM sales module. Identify the foundation of customer relationships in Microsoft Dynamics CRM. Understand how Microsoft Dynamics CRM balances the needs of usability and reporting to benefit both management and staff.

Introduction
This lesson describes the overall value of creating and implementing a CRM strategy to an organization. It explains how Microsoft Dynamics CRM supports a successful CRM strategy through a set of modules organized by functional area: sales, marketing, and service. The lesson includes a brief introduction to each of the modules.

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Gaining a Competitive Advantage through CRM

Customer relationship management (CRM) is an important business strategy that differentiates an organization from its competition. Organizations that pay attention to customers and take actions to improve the customer experience gain a competitive advantage. Historically, organizations built structure around the products and services they create and sell. The focus was on: Achieving economies of scale through mass production Product innovation Mass marketing and product branding

These are important considerations, but they do not take the customer experience into account. Customers are not loyal to businesses that focus on these areas alone. The goal of CRM is to provide a complete view of the customer experience with the organization. When an organization understands all the interactions that form the customer experience, it gains important information about its customers needs. The organization can then use this information to be more effective at meeting customers current and future needs. It can also identify customers whose needs cannot be met profitably.

Building Customer Value

When an organization can anticipate and respond to the needs of customers, and aligns its products and services accordingly, it can begin to build customer value. Customer value means that the organization makes products and services so satisfying, convenient, or valuable to customers that they want to devote their time and money to the organization than to any competitor. When customer value is achieved, it is possible for an organization to successfully offer new products and services to existing customers. This opportunity to upsell and cross-sell existing customers is how CRM allows an organization to compete with competitors that may have a larger market share.

Supporting a CRM Strategy with Microsoft Dynamics CRM

It is important to understand that CRM is a business strategy. Microsoft Dynamics CRM is an application designed to help an organization achieve this business strategy. Microsoft Dynamics CRM provides the tools that help an organization move forward, but to achieve the maximum value, the organization must develop a CRM strategy and then use Microsoft Dynamics CRM to execute the tactics that will achieve its business goals.

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Microsoft Dynamics CRM supports the entire organization through a set of modules organized by functional area: sales, marketing, and service. These modules form the centralized database through which all of the departments in the organization can access the information and the tools they need to be more effective with customers.

Understanding Customer Relationships in Microsoft Dynamics CRM

At the heart of the Microsoft Dynamics CRM system is the customer record. Microsoft Dynamics CRM gives users a sophisticated yet easy-to-use way to store and use different types of information about customers. Customers can be any organization or person at the heart of an organization. These can include traditional business-to-consumer customers, such as the clients of a retail operation, or business-to-business customers, such as the clients of a technology consulting firm. Non-traditional customers, such as the members of a nonprofit organization or the members of a community served by a government agency, can also be represented. There are two types of customer records: accounts and contacts. An account record represents an organization and a contact record represents an individual person. Accounts and contacts can be related to other accounts and contacts in various ways to model business relationships in real-world organizations. In addition, the entities within the sales, customer service, and marketing modules in the system are all tied to customers.

Balancing Usability and Reporting

Microsoft Dynamics CRM provides tools for both management and staff. This is critical to balancing between the potentially conflicting needs of reporting and usability. Management wants detailed reports about the business, which are useful but require a lot of accurate data to produce. Staff members need a tool that allows them to be more efficient; otherwise, the data entry requirements can be onerous. Microsoft Dynamics CRM can provide value to the worker-enough value to make it worth the time to enter and update information in the system. In addition, many features of Microsoft Dynamics CRM are designed to make data capture easy. Many of these features are found within Microsoft Dynamics CRM for Outlook, which provides an easy-to-use interface for staff members. The system also provides workflow management, which helps improve individual and organizational efficiency. Finally, Microsoft Dynamics CRM includes query tools and data entry shortcuts to help information workers to find and manipulate the data they need.

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Managing Processes with Microsoft Dynamics CRM

Microsoft Dynamics CRM is organized into three major modules. These modules share a common database but provide different functionality. The first, sales, manages sales processes or similar processes that involve managing opportunities (such as recruiting, fundraising, or membership drives). The second, marketing, manages marketing or other mass communications processes. The last, customer service, manages service or other case- or incident-based processes.

Managing the Sales Process with Microsoft Dynamics CRM

Microsoft Dynamics CRM sales management includes all the tasks associated with creating sales opportunities and closing deals. This includes: Prospecting and qualifying leads, and managing opportunities, contacts, and accounts. Tracing the stages of deal closure. Managing and tracking communications between salespeople and customers, starting direct e-mail campaigns, and measuring their success. Maintaining a database of product information in a format that is easy for the sales force to access, either online in the office or offline at a customer site.

Microsoft Dynamics CRM is designed to help an organization acquire and retain customers and reduce the time spent on administrative tasks. It provides a robust account management system that automatically tracks sales-related activities and revenues. It includes analytical, operational, and collaborative tools you can use to improve and maintain good customer relations. It also provides tools that help assess customer value in terms of the future business they might generate. You can perform this type of analysis early to help the sales department forge strategic corporate sales relationships. The automated sales force management tools in Microsoft Dynamics CRM organize the basic information required to track sales activities and account ownership. This information can also be used to structure the sales force into territories and teams.

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The communication management, direct e-mail management, and sales process management tools in Microsoft Dynamics CRM measure both the tangible and intangible factors that affect the bottom line: customer satisfaction and sales force effectiveness. Even if profits are up overall, tracking revenues generated by individual salespeople and assessing these figures against sales costs provides insight into how the organization is faring. If this analysis reveals, for example, that the amount of time spent on administrative tasks is equal to or greater than the time engaged in sales-related efforts, sales costs are too high, and the sales force is not functioning optimally, then your organization can take steps to improve these areas. Microsoft Dynamics CRM provides automation tools that reduce the time salespeople (and their managers) typically spend performing administrative tasks. Automated sales force management also provides important information about the organization's sales efforts, such as a list of all salespeople and the contacts and opportunities they are working on, sales forecasts for the coming quarter, or a view of the sales activity in each account.

Managing Customer Service with Microsoft Dynamics CRM

Microsoft Dynamics CRM service management includes an extensive set of features designed to increase the efficiency of service and ensure that customers receive the highest level of service. This module provides tools that help create a multi-level customer assistance policy, providing an interactive, interpersonal service that includes call routing and assignment, queue management, call tracking, entitlement processing, problem resolution, logging, monitoring, and performance management. Case management is the primary function of the service module. With Microsoft Dynamics CRM, you can create, view, and track actions and communications related to cases from the time the case is created through to resolution. By providing a structure for tracking customer inquiries, the Microsoft Dynamics CRM service module helps customer service representatives (CSRs): Simplify the case resolution process Improve relationships with customers Better track customer contacts and activities

Microsoft Dynamics CRM service queuing and routing tools are designed to help you improve how incoming requests for customer service are handled by automatically directing cases to the appropriate user. You can modify the queues and routing rules as the organization, product, and customer needs change. The Knowledge Base is a repository of articles containing problem resolution information, best practices, technical details, or any other documentation that business users need to access when addressing and resolving issues. This repository serves as a central location where consistent, relevant information is available to CSRs to help them answer questions about products and services.

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The tracking and reporting features in Microsoft Dynamics CRM enable you to determine the total amount of time spent on a case, and view a breakdown of how the time was spent. You can also create reports to measure statistics such as call lengths, resolutions, and average length of cases.

Automating Marketing Campaigns with Microsoft Dynamics CRM

Microsoft Dynamics CRM marketing campaigns enable marketing departments to create, analyze, and segment targeted customer lists as well as plan and execute campaigns for the customers the company wants to target. It allows you to collect and analyze the results of campaigns, which your marketing team can use to make future marketing decisions and make the most of your marketing dollars. Marketing campaigns are tied directly to the sales module, which enables your sales staff to get the leads that are generated from every marketing campaign. Marketing campaigns include all the tasks associated with marketing activities, which include: Marketing planning and budgeting Creating and managing target lists Planning and creating campaigns Executing and managing campaigns Tracking and marketing information

Microsoft Dynamics CRM marketing campaign functionality includes reports you can use to assess both the operational and financial performance of a campaign. You can use this data to plan, forecast, and target more effectively. This information helps the marketing team assess the quality of lead sources and design campaigns that produce better results with each effort.

Summary
This lesson explained the benefits of using Microsoft Dynamics CRM to implement a CRM business strategy. We covered the basics of customer records and discussed the value of Microsoft Dynamics CRM to both management and staff. The lesson included a brief overview of the sales, service, and marketing modules that form the overall Microsoft Dynamics CRM solution.

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Test Your Knowledge

CRM Goals
1. Which of the following are goals of a CRM system? Select all that apply. (Select all that apply.) ( ) Acquisition and retention of customers ( ) Reduce the time spent on administrative tasks ( ) Achieving economies of scale through mass production ( ) Track sales related activities and revenues

Customer Value
2. What is the benefit of building customer value? Select all that apply. (Select all that apply.) ( ) Charge existing customers more for the products that you sell ( ) Customer satisfaction ( ) Sell more products to existing customers ( ) Understand customer needs

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Quick Interaction: Lessons Learned

Take a moment and write down three key points you have learned from this chapter: 1.

2.

3.

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Chapter 1: Introduction to Microsoft Dynamics CRM

Solutions
Test Your Knowledge
CRM Goals
1. Which of the following are goals of a CRM system? Select all that apply. (Select all that apply.) () Acquisition and retention of customers () Reduce the time spent on administrative tasks ( ) Achieving economies of scale through mass production () Track sales related activities and revenues

Customer Value
2. What is the benefit of building customer value? Select all that apply. (Select all that apply.) ( ) Charge existing customers more for the products that you sell () Customer satisfaction () Sell more products to existing customers () Understand customer needs

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