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INTRODUCTION
CRM stands for Customer Relationship Management. It is a process or
methodology used to learn more about customers' needs and behaviors in order
to develop stronger relationships with them. There are many technological
components to CRM, but thinking about CRM in primarily technological terms
is a mistake. The more useful way to think about CRM is as a process that will
help bring together lots of pieces of information about customers, sales,
marketing effectiveness, responsiveness and market trends.
CRM helps businesses use technology and human resources to gain
insight into the behavior of customers and the value of those customers.
Customer relationship management (CRM) consists of the processes a
company uses to track and organize its contacts with its current and prospective
customers. CRM software is used to support these processes; information about
customers and customer interactions can be entered, stored and accessed by
employees in different company departments. Typical CRM goals are to
improve services provided to customers, and to use customer contact
information for targeted marketing.
CHAPTER 2
MEANING & DEFINATION OF CRM IN BANKS
MEANING OF CRM
Customer Relationship Management is the establishment, development,
maintenance and optimization of long-term mutually valuable relationships
between consumers and the organizations. Successful customer relationship
management focuses on understanding the needs and desires of the customers
and is achieved by placing these needs at the heart of the business by integrating
them with the organization's strategy, people, technology and business
processes.
At the heart of a perfect CRM strategy is the creation of mutual value for all the
parties involved in the business process. It is about creating a sustainable
competitive advantage by being the best at understanding, communicating, and
delivering, and developing existing customer relationships in addition to
creating and keeping new customers.
DEFINITION OF CRM
Customer Relationship Management (CRM) is a co-ordinate approach to the
selling process allowing the various operational, customer contact and sales
promotional functions of an organization to function as a whole.
E-CRM:E-CRM refers to the set of activities that enable a firm to utilize the power of
the Internet and the electronic medium to implement CRM. Firms all around
the world have realized the potential of the Internet as a medium for CRM and
have been actively pursuing E-CRM strategies.
The following statistics highlight the importance and potential of the e-CRM
industry.
General Motors (GM) receives about 100,000 emails from it customers,
every day.
The volume of customer related email traffic is so much that almost 42%
of the queries never get answered by the companies.
The Gartner group estimates that as of October 99, about 90% of the
firms are not equipped to handle customer e-mail with a probability of 0.9
A complete E-CRM architecture would comprise of the following components:
1.
2.
3.
4.
5.
Call Centers
6.
Managing the full range of the customer relationship involves two related
objectives
1. Customer Engagement
Marketing
2. Business Transaction
Planning
and
Campaign Management
Telemarketing
and
Order Acquisition
Internet
Lead
Pricing
and
Configuration
Generation
E-Selling
Opportunity Management
Telesales
Field Sales
Profitability Analysis
Management
Customer
Segmentation,
Collaborative
Content
Management
3. Order Fulfillment
4. Customer Service
Interaction Center
Process
Service Management
Contract,
Claims Management
Field
Billing,
and
Financials Management
Service
--
Mobile
Service
This involves not only integrating the functional components of CRM solution
but also integrating these components across multiple channels so that the
customer interaction can be seamless, consistent and efficient.
Integrated Workflow
CRM solutions should have a strong workflow engine to ensure that crossfunctional tasks can be accomplished as dynamically and seamlessly as
possible.
consumer obtain more targeted assistance than ever before. The idea of mass
customization is at the heart of Customer Relationship Management. Every
CEO out there realizes or is in the process of realizing the importance of
customer needs to their business, and never before have their options been so
diverse. There are such things as intelligent agents, learning agents, negotiation
agents, chat rooms, FAQs pages, personalized web pages, help desks, call
centers, and, as we are all aware, automated emails and automated response
systems.
Today's CEO is bound to be a bit overwhelmed by his or her options with
respect to Customer Relationship Management. In fact, the options available
are so astounding, that several companies specialize in customer relationship
management alone. However, there is some basic theory upon which all of the
different software packages offered by all of these companies are founded:
customer loyalty, trust, and referrals. Loyalty is basically self-explanatory, and
it is the single most significant contributor to profitability. "Customer loyalty,
measured in repeat purchases and referrals, is the key driver of profitability for
online businesses, even more so than for offline companies, according to a
series of joint studies in online retail by Bain & Company and Mainspring. For
example, in apparel, the average repeat customer spent 67 percent more overall
in the third year of his or her shopping relationship with an online retail vendor
than in the first six months. And, over three years, customers referred by online
grocery shoppers spent an additional 75 percent of what the original shopper
spent." (Mind spring) "The study also found that the average online apparel
shopper was not profitable for the retailer until he or she had shopped at the site
four times. This implies that the retailer has to retain the customer for 12 months
in order to break even.
Targeted marketing
Customer retention
Increased growth
Increased Revenue
Closed-Loop Marketing
Marketing applications are tightly integrated with the other applications of the
CRM suite as well as the ERP applications. This integration enables marketers
to tap into the wealth of data collected through every customer "touch" with
their company whether through field sales, a call center, or the Web. Without a
dependence on simple demographics, marketers will be able to profile
customers based on any number of criteria including sales cycle, payment
preference, and purchase frequency, to tailor messages and campaigns with
better accuracy for highly focused, individualized marketing campaigns.
Expand Marketing Channels Through the Web
Utilize the power of the Internet to increase your marketing reach and
effectiveness.
In addition to supporting traditional marketing and demand creation channels
such as direct mail and tele-business, many vendors are enhancing the
integrated closed-loop marketing application through relationships with several
strategic third-party vendors. The combination of these applications will expand
the automation of the marketing planning and execution process over multiple
deployment channels and sales models, specifically through the Web. By
leveraging the Web as a channel, Marketing applications will help companies
capitalize on this rapidly expanding opportunity to reach a larger audience with
their marketing campaigns.
The objectives for Service Applications offered by a CRM suite are as follows
Its
comprehensive
resource
management
capabilities
enable
organizations route the calls to the right agent to reduce call resolution time. Its
enterprise wide customer management ability enables you to reduce billing time
with built-in integration between contracts, warranties, resource usage and the
billing system. Further, with interfaces to customer care, organizations can track
total customer contact history to increase customer knowledge and reduce
redundancies and resolution time. Fast parts rotation enables reduced inventory
levels and therefore, reduced costs.
Understand
prospective
policy
holder
requirements
2. Understand what products and services will retain them and increase
profitability
Making the customer the focal point and understanding that it is about
meeting their needs will go a long way in ensuring success.
Staff need to accept the fact that this will do them good and willingly give
off their best customer support effort.
STRATEGIES OF CRM
Strategy
Several CRM software packages are available, and they vary in their
approach to CRM. However, as mentioned above, CRM is not just a technology
but rather a comprehensive, customer-centric approach to an organization's
philosophy of dealing with its customers. This includes policies and processes,
front-of-house customer service, employee training, marketing, systems and
information management. Hence, it is important that any CRM implementation
considerations stretch beyond technology toward the broader organizational
requirements.
The objectives of a CRM strategy must consider a companys specific
situation and its customers' needs and expectations. Information gained through
CRM initiatives can support the development of marketing strategy by
developing the organization's knowledge in areas such as identifying customer
segments, improving customer retention, improving product offerings (by better
understanding customer needs), and by identifying the organization's most
profitable customers.
CRM strategies can vary in size, complexity, and scope. Some companies
consider a CRM strategy only to focus on the management of a team of
salespeople. However, other CRM strategies can cover customer interaction
across the entire organization. Many commercial CRM software packages
provide features that serve the sales, marketing, event management, project
management, and finance industries.
From this perspective, CRM has for some time been seen to play an important
role in many sales process engineering efforts.
not educated regarding bank matters and the source of knowledge to them was
only the bank agent: and he was the person who suggested the policy to the
customer instead of the customer making his own choice. The customer could
not even choose some other policy from some other insurer because it was
Hobsons choice, i.e., LIC.
But, when private players entered the market, the competition forced LIC
and the other new entrants to become customer-centric.
Customer service is becoming more and more important as most of the
time buying bank policy is a one-time purchase and customers are unaware of
the variations available in the market. In the bank sector, there is an agent-client
relationship and a satisfied client can be the biggest brand ambassador for the
company (word of mouth advertising). Thus, it is in the interests of the company
to build a good relationship with the clients.
The bank agents of the company play an role in building this relationship
because they are the people who interact with prospective and existing clients.
Therefore, every organization should build a foundation of relationship
marketing because relationship marketing is the new mantra and the faster the
company adopts it, the better it would be in taking care of its customers.
Relationship efforts help the agents to talk about the company and the product,
and convince the customer. The need of the hour is to go in for training the
agents in building customer relationship.
The best effort is to go from CRM in an integrated approach. To be more
friendly and customer-centric, organizations need to implement a CRM strategy
which helps to interact with their customers in a more informed manner because
CRM helps the manger, the agent and the other officials (present or past
employees) to understand the status of the present client: His past transaction;
his last meeting with the agent and the comments of the agent or the manager or
the concerned employee; the dealings and the other relative information which
can be of use to the present employee or the agent of the company handling a
particular company, etc. so, CRM should be implemented in such a way that it
does become a hurdle to the organization but is its asset, which facilitates. The
smooth flow of information and better care of consumer CRM has been
estimated to be of use to all organizations, be it of service sector or any other
sector still, the experience in the implementation part has not been so
successful. In most of the cases, it has been practically observed that CRM
implementation in an unstructured manner has led it to become a hurdle for the
organization instead of becoming a valuable asset and an integrated part of the
company.
3
LIC, the biggest player in the Indian bank sector has also gone for
implementing CRM in its organization it facilitate better care of customer. Now
the consumer can deposit their premium in any computerized branch all over
India. The manager can look into all the details of the client at the moment,
regarding the policy, the premium paid and the due date for the next premium.
But it has not been able to implement the CRM strategy at the bottom level; i.e.,
the level of the frontline manager and agents who are the persons interacting
directly with the clients (potential and existing).
So, it is a must that the agents should be equipped with the relationshipmarketing tool, which can provide an upper edge in this competitive scenario.
It is a task of the top level and middle level managers to train their agents
to practice relationship management and build relationships with their clients.
1. The agents should be trained to analyze their environment (society,
friends, peer groups, etc.) and build good relationships with their
environment because a good marketer first forms relationships and then
sells his goods.
2. An agent should make a profile of the prospective target (or potential
client).
3. He should be trained and interact with them.
4. He should be trained to build the customer database and classify them
into potential and existing customers and then the existing customers into
dissatisfied, satisfied and highly satisfied customers.
5. The agents should be trained to get the feedback of the customer because
bank selling is a confidence-building measure where a relationship is
built between the client and the agent, which last for a long duration.
Apart from this, the management or the organization also needs to be
trained in CRM approaches because some academicians perceive that the agents
or business associates or partners in the bank sector are more CRM-oriented
then the organization. So, it is the organization, which needs to be trained in
CRM approaches.
Therefore, to survive and have an upper hand over the competitors, bank
companies need to implement CRM in their organizations not only technically
(computers, networks, database
systems, CRM software, trained personnel) but also as part of the culture.
Relationship marketing is the key to success in the present era and only those
organizations can succeed who have been able to build a base of their loyal
customers, because the loyal customer advocates the companies product much
better than the organization itself. The basic existence of the organization lies in
the hand of the customer. It can be easily concluded that for success, it is
necessary to implement CRM in the right manner.
integration with our call centre operations, which no other vendor was offering.
The suite promised a common integrated platform for different customer-facing
departments [sales, marketing and customer services] within the organisation.
A smooth roll-out
The implementation of the CRM suite was a smooth affair. The
implementation exercise began in December 2001 and went live six months
later. Pandey explains, Since we went in for the CRM suite before launching
our business in India, the implementation was smooth. If an organisation is
already in business the implementation exercise can be a prolonged affair.
The CRM suite has been deployed in marketing, sales and service as well
in the partner and sales ecosystem (comprising bank assurance partners and
bank agents). Aviva has implemented several modules of Talisma e-CRM, such
as marketing, sales, servicing, and contact centre. The only component it hasnt
used is the chat module.
Aviva can share real-time customer information across its customerfacing departments across locations.
It has facilitated the timely analysis of the companys sales and marketing
initiatives, thus helping Aviva modify its products and services to the
tastes and requirements of customers.
11. CONCLUSION
Maximize customer satisfaction and maximize your bottom line.
Over the last decade, too many organizations have assumed that their products
or services were so superior that customers would automatically keep coming
back for more. But in order to compete effectively in todays marketplace,
organizations must change their strategy to become more customer focused, not
product focused.
Customer Relationship Management (CRM) is the best way to integrate this
customer-facing approach throughout an organization. Aimed at understanding
and anticipating the needs of an organizations current and potential customers,
this innovative book shows how CRM links people, process, and technology to
optimize an enterprises revenue and profits by first providing maximum
customer satisfaction.
Covers developing a market-oriented strategy, innovation in products and
services, sales and channels transformation, customer relationship marketing,
and customer care.
12. BIBLIOGRAPHY
Books Referred:
Customer Relationship Management-(Sem.3rd )
Vipul Prakashan
Websites:
www.google.co.in
www.scribd.com
www.wikipedia.com