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ESSAY 2

Global Issue: Analysis of CRM Systems in Customer Service

Introduction

There is an increase in the adoption and implementation of CRM systems across the

globe. Fundamentally, different CRM systems have varied usage and success rate statistics for

different users. The following table highlights a summary of various CRM statistics such as,

worldwide spending budgets on CRM software by suppliers, most desired features by users, the

rate of adoption of CRM software/systems, and the return on investment (ROI) for companies.

Noteworthy, the information provided below covers previous years’ statistics up to the year

2017.

Table 1: Statistical analysis of multiple CRM software aspects

Global spending on CRM Most Desired CRM CRM ROI


CRM Software by Adoption software features (User companies’ statistics)
Vendor Rates (user companies’
statistics)
1. Salesforce - 19.7% On premise: Ease of use - 65% - Productivity improved by 50%
2. SAP - 10.2% 2008 – 88% Emailing - 60% - Sales quotas (after adoption of
3. Oracle - 7.8% 2017 – 13% Scheduling - 27% CRM) increased by 65%
4. Microsoft - 4.3% Cloud-based: Data snapshot - 18% - Business-client relationships
5. Adobe - 3.6% 2008 – 12% improved by 74%
6. Others - 54.4% 2017 – 88% - Labor cost decreased by 40%

Source: Lazar, 2017.

Discussion

Customer Relationship Management (CRM) systems avail information to a company’s

clients besides facilitating the management of client relationships with the company. Thus, it is

essential for companies to centralize their CRM systems around their customers to provide
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client-oriented solutions. Again, an effective CRM system offers the customers a variety of

channels of interaction with the company. The latter helps to accommodate different user-

preferred communication methods with the service provider where need be. Nonetheless, the

company must also avail ample customer service resources to meet customers’ needs at various

service levels or contact points (Thorzén, 2011, p.42).

On the other hand, research indicates an increase in the value of CRM from $36billion to

$40billion between 2016 and 2018 respectively (Lazar, 2017; Taylor, 2018). In 2018, research

indicates an increase in sales quotas to 65 percent for companies whose sales reps have adopted

mobile CRM. In contrast, companies without mobile CRM have recorded 22 percent in sales

quotas (Taylor, 2018). Moreover, there is a significant increase in accessibility to CRM software

from several devices such as, laptops, tablets, smartphones, and desktop. Recent estimates show

that 81 percent access CRM software using these devices. These statistics indicate an increase in

the overall spending and investment on CRM software among companies, with the objective of

enhancing the customer experience in addition to availing an array of online self-help options for

their customers (Taylor, 2018).

Noteworthy, multinationals like Wal-Mart, McDonalds, and Starbucks among others,

have generously contributed to the incredible growth of the CRM industry. The table below

outlines three selected companies and their respective CRM systems (see: Appendix). According

to Benzinga (2016), Wal-Mart’s Sam’s Club relied on traditional processes for customer

acquisition and engagement. However, after adopting the Salesforce CRM software, this

multinational has improved such activities and maximizing productivity. The Sales Cloud

platform has enabled Sam’s Club to automate its operations and processes and minimize gaps

between the physical and digital shopping experience. Additionally, this technology offers the
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business an all-round view of mobile devices and key stakeholders across its various clubs

(Benzinga, 2016).

Similarly, McDonalds SecondCRM software and Starbucks Loyalty program have

improved customer service standards for both companies. Starbucks’ consumers perform

approximately 20 percent of all transactions weekly (Koba, 2015). The Starbucks Loyalty

program has optimized ease of purchases besides offering incentives to its loyal customers in

distinct categories such as, welcome, green, and gold (Koba, 2015). McDonalds Singapore

currently enjoys improved customer handling procedures thanks to SecondCRM software.

Consequently, the customer service department is able to provide timely and tailored feedbacks

to various customers’ responses (SecondCRM, 2018).

However, the use of CRM systems creates serious ethical and social difficulties for such

companies. For instance, since these systems rely on online exchange of information, it is almost

impossible to guarantee privacy and security of information. Lobato et al. (2017) argue that

companies have incorporated software applications in their CRM systems to safeguard

customers’ data and information. Furthermore, they argue that social CRM initiatives create

ethical and legal issues resulting from unauthorized access of confidential client-related details

by third parties. On the contrary, Frow, Payne, Wilkinson, & Young (2015, p.22) argue that a

CRM technology may negatively affect customers. For example, malicious service providers

may use the intrusive capabilities of CRM technology to exploit customers. Again, they also

affirm that a poorly articulated CRM strategy or misinterpretation of the company’s CRM

strategic focus result in catastrophic outcomes for the company’s consumers. These ‘dark side

service provider behaviors’ often result in antagonistic interactions between service providers

and frustrated customers.


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Conclusions

Statistical evidence points to an increasing adoption of CRM systems across the globe in

managing customer relationships. Multinationals such as, Wal-Mart, McDonalds, and Starbucks

have maximized productivity and improved customer satisfaction levels after integrating various

CRM software into their processes. However, ethical and social ramifications surrounding CRM

technology pose a dilemma for such companies. Research shows the possibility of customers’

exploitation by malicious service providers. Even so, the benefits accruing to CRM technology

far outweigh such circumstantial ramifications. Besides, contemporary trends in marketing

strategies and relationship management advocate for the adoption of CRM systems across all

industries. Companies can overcome the ethical and social implications associated with CRM

technology through adequate training and regular monitoring of CRM initiatives.


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References

Benzinga, R.C. (2016, July 28). Wal-Mart’s Sam’s Club selects Salesforce to Digitally

Transform its Membership Engagement. Yahoo. Retrieved from

https://finance.yahoo.com/news/wal-marts-sams-club-selects-154031075.html

Frow, P., Payne, A., Wilkinson, I., & Young, L. (2015). CRM and customer management:

identifying and confronting dark side behaviours. The Dark Side of CRM: Customers,

Relationships and Management. In: Nguyen B., Simkin L., & Canhoto, A.I. (eds). p. 22.

New York, NY: Routledge.

Koba, E. (2015, November). Why Starbucks Wins at CRM. Retrieved from

https://marketingdiscussions.wordpress.com/2015/11/09/why-starbucks-wins-at-crm/

Lazar, M. (2017, May 12). E-Commerce CRM Software. IBM. Retrieved from

https://www.ibm.com/developerworks/community/blogs/d27b1c65-986e-4a4f-a491-

5e8eb23980be/entry/2017_CRM_Statistics_Show_Why_it_s_a_Powerful_Marketing_W

eapon?lang=en

Lobato, F., Pinheiro, M., Jacob, A., Reinhold, O., & Santana, Á. (2017). Social CRM: Biggest

Challenges to Make it Work in the Real World. In: Abramowicz W., Alt R., & Franczyk

B. (eds) Business Information Systems Workshops. BIS 2016. Lecture Notes in

Business Information Processing, vol. 263, pp.221-232. Springer, Cham. doi:

https://doi.org/10.1007/978-3-319-52464-1_20

SecondCRM, (2018). McDonalds. Retrieved from

http://www.secondcrm.com/customers/mcdonalds

Taylor, M. (2018, June 6). 18 CRM Statistics You Need to Know for 2018. SuperOffice.

Retrieved from https://www.superoffice.com/blog/crm-software-statistics/


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Thorzén, M. (2011). Analysis of Customer Relationship Management Systems’ Compliance

With Organizational Needs: An industrial case study in a Spanish organization. Master

Thesis. Retrieved from https://www.diva-

portal.org/smash/get/diva2:829886/FULLTEXT01.pdf
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Appendix

Table 2: Analysis of CRM Systems of Multinationals

Company CRM System/Software Results


McDonalds SecondCRM (Outsourced Efficient consolidation and storage of
Singapore Software) customer information for easy retrieval and
effective management of disparate
customer responses (SecondCRM, 2018)
Wal-Mart’s Sam’s Salesforce (Outsourced Digital transformation has enabled Wal-
Club software) Mart to enhance customer engagement and
improve the membership experience
(Benzinga, 2016)
Starbucks The Starbucks Loyalty Program Higher rates of customer retention and
(Mobile app) increased online transactions (Koba, 2015)