CRM

(Customer Relationship Management)

Rationale of CRM
CRM is about better understanding of customers behavior & needs, & developing & implementing business strategies & supporting technologies that closes the gap between an enterprises current & potential performance in customer acquisition, growth & retention.

 Companies that need customers in order to build a profit need to have a system in place that effectively & successfully manages the customer/client relationship.
Many companies are choosing to have some of their employees earn a certificate in customer relationship management or contact management. This type of education will proper employees to interact with customers & potential customers in a positive way that encourages future communication & the sought after sale

 Contact Management teaches the tools that allows the employees to take contacts & turn them into sales & profits. CRM denotes company wide business strategy embracing all client facing department & even beyond. When an implementation is effective, people, process & technology work in synergy to increase profitability & reduce operational costs. Customer's expectations are not now only limited to get best products & services , they also need a face-to-face business in which they want to receive exactly what they demand & in a quick time.

 An ideal CRM system is a centralized collection of all data sources under an organization & provides an atomistic real time vision of customer information. CRM is not only to deal with the existing customers but is also useful in acquiring new customers. The process first starts with identifying a customer & maintaining all the corresponding details into the CRM system which is also called an Opportunity of Business". The sales & field representatives then try getting business out of these customers by sophistically following up with them & converting them into a winning deal

Growing Importance of CRM

CRM is not only pure business but also strong personal bonding within the people . Development of this type of bonding drives the business to the new level of success Once this personal & emotional linkage is built , it is very easy for any organization to identify the actual needs of customer & help them to serve in a better way.

 For making customer loyal, & thus increasing customer base. For increasing customer satisfaction , & thus making more & more business out of them. Reduce process time & increasing productivity . It is cost effective. Less need of paper or manual work

 For acquiring new customers. For grouping the customers which helps focusing & concentrating on each & every customers separately. For tracking the customers & can be used to determine which customer can be profitable & which not.

Features of CRM
CRM is a strategy which is customized by an organization to manage & administrate its customers & vendors in an efficient manner for achieving excellence in business. It is primarily entangled with the following features :-

Customers Need Customers Response Customers Satisfaction Customers Loyalty Customers Retention Customers Complaints Customers Service

Misunderstandings about CRM

Identifying CRM with a software system CRM is a complicating system, difficult to understand CRM is expensive & unaffordable by small enterprises Wrong assessment for the ROI in CRM Responsibility for CRM implementation

Why should a company adopt CRM?

A CRM solution is capable of providing real time access to the stored data about a customer & related matters. Acc. to Pareto principle 20 percent of customers are responsible for 80 percent of company profit. It is absolutely necssary to do everything possible to retain loyalty of these customers.

 Acc. To BCG, cost of selling to an existing web customer is around 6US $ & cost of acquiring a new customer is around 34US $. A 5% increase in expenses in keeping existing customers translates into 25% or more increase in profitability.

CRM Systems
The old way of storing client information , such as customers names , address & phone numbers are no longer enough these days. To succeed in this very competitive environment , your business has to track customers needs & behaviors in order to foster stronger relationship with them.

 CRM systems involves gathering a lot of data about the customer. The data is then used to facilitate customer service transactions by making the information needed to resolve the issue or concern readily available to those dealing with the customers.

CRM systems are of much help to the Top Mgt people in the following ways:It provide crucial data like customer satisfaction & efficiency of service Help to generate reports for product development or new concepts Help in deciding the companies future course of action

 The reports generated by CRM systems are also invaluable to your advertising & marketing planners, as they will be able to pinpoint which ideas works & which do not. Because of the CRM systems, u will be able to release advertisements or plan marketing campaigns more in tune with your target market

BENEFITS OF CRM
(For different levels of organization)
For Operational Level of Management For Tactical Level of Management

For Strategic Level of Management

For Operational Level of Management

1.Improved customer data management
To be effective,CRM systems require integrated & high quality customer data. Identifiers for customer data management are:-

 Improved accuracy of customer information Improved completeness of customer information Decrease in the number of duplicate records Reduction in time taken to access complete customer information Increase in timeliness of information Improved customer data history

2.Improved Process Management For successful implementation of CRM systems, the alignment of information technology & business processes is essential.Indicators for improved process management are:-

 Reduction in the number of redundant processes Increase in efficiency at different stages of managing the customer Increase in efficiency in assignment of tasks

3.Improved Customer Service By aligning people, technology& processes together , CRM systems assist organizations in providing consistent & personalized customer service. Indicators for improved customer service are:-

 Increased number of resolution at first point of contact Reduce handling time for enquires Increased access to high quality information at the point of customer contact.

4.Empowerment of Staff By giving employees access to more customer data, CRM systems provide them more autonomy in their tasks to shape procedures to the requirements of specific customers. Indicators for empowerment of staff are:-

 Increased conversion rate of prospects Increased staff satisfaction level Reduction in administration of sales staff

5. Improved productivity Existing users of CRM results in improved productivity. This is particular significant during economic downturn when productivity gains translate into increased profit margins through cost savings. Indicators for improved productivity are:-

 Reduction in lost opportunity costs Reduction in costs for lead generation,marketing,customer service & sales Each sales representatives handle more no: of customers in the given length of time

6. Enabling of Real-time Responsivenss to trends CRM systems enhance relationship with the customers by facilitating immediate response to their needs & foster continuous learning & improvement. Indicators for enabling of real time responsiveness to trends are:-

Increase in number of cross sales Increase in number of up-sales Earlier detection of trends Increased number of effective campaigns

For the Tactical Level Of Management

1. Improved facilitation of Market segmentation CRM analytics enables profiling of customers from a heterogeneous market to appropriate levels of aggregation to obtain smaller, more homogenous groups. Indicators of Improved facilitation of Market segmentation are:-

 Increase in campaign response rates Increase in identification & utilization of bussiness opportunities Increase in target marketing driven revenue Increase in profitability of market segments Increase in target marketing initiatives

2. Facilitation of Key Account Management

CRM systems enables better management of key account customers. Indicators for facilitation of Key Account Management are: Increase in average customer lifetime value Increase in number of customers with high lifetime value.

3. Improved Channel Management

CRM systems allow the organization to increase profitability by ensuring that the most effective channel is used for specific products & customers. Indicators for improved channel management are:-

 Increase in no: of transaction through cost effective channels. Increase in the no: of customer self service activities Reduction in the usage of cost ineffective channels

4. Improved Analysis , Reporting & Forecasting Organizations can improve analysis & produce more accurate forecasts using high quality , integrated customer data from CRM systems. Indicators for this are:-

 Improvement in monitoring of KPIs Improvement in reporting at customer rather than accounts Increase in th no: of relevant reports available.

For The Strategic Level Of Management

1. Improved Customer Satisfaction Indicators for Improved Customer Satisfaction are:Improved Value Perception Increase in period of customer loyalty Increase in the no: of repeat customers Reduced no: of complaints Increase in word of mouth recommendation

2. Improved Business Performance

CRM systems can lad to improved business performance in terms of reduced customer complaints & increased customer retention, revenue & profitability. Indicators of Improved Business Performance are:-

Increase in Profit Increase in share of wallet Increase in customer retention Increase in revenue per customer Increase in sales Increase in no: of customers

3 . Improved Innovative Use Of CRM systems