CUSTOMER RELATIONSHIP MANAGEMENT

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Introduction
Gradual migration from the Sellers market to a buyers market. Customers are much more informed and demanding than ever before. Specific efforts are required to acquire and retain customers and they are not only in marketing and sales but also in other functional areas. Cost of regaining a lost customer is substantially higher than the cost of gaining a new customer. MIS can help in ensuring that appropriate products and services are made available to customers at the right time and right place.
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Introduction (contd)
The information systems based solutions that focus on customer related business processes came to be known as Customer Relationship Management (CRM) solutions. Even if buyer would not be making purchases over internet, the buyer would use Internet to get information about the product, product features and functionality, prices and discounts available, the details of sellers and so on. Many times information about the customers is residing in form of information islands spread over different departments within the orgn. E.g. Salesperson attending a Customers call.
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CRM as an Enterprise Solution

CRM is not the job of the front end sales team but the job of everyone in the organization. Therefore, CRM can be considered as an enterprise solution and not just software.
For this, CRM must have tight integration with all other information systems in the enterprise. Earlier, CRM implementation failed. It was considered job of IT department.
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CRM as an Enterprise Solution (contd)

Marketing and Sales team members who are constantly dealing with customers are in a better position to understand customer expectations and therefore should take lead in CRM implementation. CRM solutions started providing expected business benefits when the marketing and sales team took the drivers seat in CRM implementation and IT dept took the enablers seat.
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Change in Organizational Structures

Orgns focus on their products or their internal processes for defining their orgn structures, reporting relationships, procedures and practices. In todays dynamic and competitive marketplace, customers are not concerned about how the organization is structured and how many depts the orgn has. What really matters to the customer is the time and quality of response and not the method by which the response was generated. To restructure the orgn to display a process approach, rather than functional dept approach.
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How CRM changes the marketing setup

It is common to find that different people within the orgn deal with the same customers. Customer would have to repeat what was said earlier. There is effort duplication in such orgns. Many times information about customers and promises made by the field salesperson during the last call is not easily available to the person who is visiting the customer next time. CRM uses a common information repository. It is possible to assign single point of contact responsibility to individuals to deal with specific customers.
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How CRM changes the marketing setup

Effort duplication is reduced and minimized to a great extent. When the CRM is web enabled, such information access can be possible from remote locations. With appropriate integration with other information systems in the orgn, information updates are automated and the need for searching information is eliminated. E.g. Customers situated in different time zones are in a position to visit the companys website and get instant status about the orders in a 7 / 24 basis. Some companies implemented Sales Force Automation module of CRM that takes away the paperwork and the effort of gathering and compiling of reports.
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CRM Industry Specific Solutions

The basic concepts of CRM may remain the same across the industry segments but the approach is different. E.g. FMCG v/s Small Co. having few buyers. One simple plain vanilla solution of CRM is therefore not a feasible solution and CRM needs to be configured keeping the industry specific requirements in the prime focus and using IT as an enabler for effective implementation.
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CRM for All Organizations

It is a myth that CRM is useful only for large orgns with a very large customer base distributed in a large geographical area. There are CRM solutions that are affordable for small and medium enterprise (SME) sector companies. The CRM concept meeting industry specific requirements could even be implemented with the help of component or a subsystem of CRM such as customer portal on the web.
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CRM Architectural Approach

The CRM architecture can consider a stand-alone database that can be integrated with other databases used in the orgn or could also consider using the same database through a tightly integrated information system. Number of vendors of ERP software solutions today offer solutions that include CRM as one of the components or as a module. In case of most orgns, all customers cannot be considered as equals and therefore cannot be treated as equals. Marketing professionals have different strategies to deal with different customers. The CRM implementation team has to closely work with the marketing professionals in order to map such strategies.
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Benefits of using a CRM solution

Sales force productivity improvement
Increase in Productivity means more output with same input or same output with reduced input. With CRM, the sales force is in a position to cover more areas and customers without the need to add resources.

Better conversion ratio betn Inquiries to deals

Since information about prospects and quotations submitted is instantly available, it is possible to maintain proper follow up and coordinate the sales efforts. This directly or indirectly improves the number of inquiries being converted into sales.

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Benefits of using a CRM solution

Reduction in sales cycle time
Deals can be closed faster as the waiting period for fetching required information is reduced dramatically.

Quick and accurate order registration

There are examples of companies where field salespersons can send the customer order using SMS facility on their mobile handsets. By this way, orders are registered in the system without any delay. Similarly orders can be registered by the Customers themselves through the Customer Portal module of CRM.
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Benefits of using a CRM solution

Online availability of Order status for the customers
Thru CRM, customers are in a position to get accurate status about their orders without waiting and without manual intervention. E.g. Transport Companies.

Faster response to customer queries

Customer query can be answered in shorter time as information is instantly available. When the customer calls, it is possible to quickly refer to the database by entering the order number and know the date on which the shipment is planned.
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Benefits of using a CRM solution

Better call distribution and follow up
Using CRM, a salesperson can set a reminder to call up a prospect after a given number of days. Using the call distribution functionality of CRM, service calls coming from customers in specific geographical area can be forwarded to the service person that is nearest and can move quickly to attend the call.

Improved Customer Service Levels

An Automobile dealer who has sold a car can know when the first and second mandatory service would be due and proactively remind customers about the servicing of their car.
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Benefits of using a CRM solution

Improved Customer Satisfaction Index levels
Successful implementation of CRM ensures that the expectations of the customers are met and even exceeded to cause customer delight. This means improvement in customer satisfaction index.

Better retention and greater customer loyalty

When customers are satisfied and delighted there is better chances of retaining such customers and even creating loyal customers.

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Readymade CRM Solution

Large number of vendors are offering CRM solutions. It should have highest percentage fit for specific industry requirements. Plus it should be scalable, flexible, cheap, periodic upgrades and integration with other IS in an orgn. ERP is back-office system and CRM is front-office that deals with customers. Integrating the back office with the front office is essential for making the CRM implementation a success. The task acquires more complexity when the vendors offering ERP and CRM are different and their systems as well as the operating platforms are not fully compatible.
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Implementing a CRM
Even after implementing a state-of-the-art CRM solution, a customer may find it cumbersome to get consistent and accurate information in the first attempt. Instead of having approach How to sell product, implementation of CRM should have approach of How to make it more convenient for the customer to buy the product. The sale of the product will be the automatic result. For this, field sales as well as marketing personnel have to be completely involved right from the design phase. Implementing CRM solution is to be considered as an activity pertaining to achievement of strategic goals and needs to be given appropriate importance.
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Influence of Web based CRM

It is a known fact that prospective customers would gather product information through the Internet even though the actual buying decision may not be made through the Internet. Companies are allowing their trading intermediaries as well as customers to place orders through WWW. E.g. Future Bazaar. Dell Computers. Configured to Order personal computers & laptops. As we select specific component, the screen shows the price. This system may not work for some industries.
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Pitfalls in CRM
Technology Pitfall
CRM suite is acquired at a price without looking at hidden costs associated with customizing and implementing it. All customer facing processes in the orgn need to be reviewed and IT solution that is providing highest percent fit is to be identified.

Customer First
IT should be given the least priority and first priority must be the customer. Once the expectations of customers are understood and the entire orgn is transformed into a customer centric enterprise, then would come the IT to play its enabling role.

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Pitfalls in CRM (contd)

It works for other companies
CRM vendor would give a list of companies where their CRM suite has been implemented successfully. Every orgn is different and the CRM requirements would be orgn specific. The functional managers can prepare their wish-list about a CRM solution and then compare different CRM solutions available against the wish-list.

Top Management Commitment

CRM is not something that can be delegated to the IT team and third party implementation partners. Top mgmt must show commitment by way of sparing time to participate in strategy formulation, business process mapping and periodic review throughout the CRM implementation project.
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Call Centre
Call centres can be classified in TWO distinct categories i.e. Outbound Call Centre & Inbound Call Centre. From an Outbound call centre, service professionals dial the numbers of prospective and existing customers for different activities. In Inbound call centre, calls are originated from prospects and customers. The activities of inbound call centre are dependent of the type of call centre operations and vary according to the type of customers, products or services etc. Call centres to have an appropriate IT infrastructure that allows instant processing of the activities. It may be located in different geographical territory.
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Call Centre (contd)

Professionals working in such call centres are located in different time zones and have to adjust to the language and cultural aspects of the country in which customers are located. Call centres are used for two purposes: 1) Acquiring new customers 2) Retaining and servicing existing customers. The planning and control of the operations is of critical importance and performance monitoring through appropriate parameters on periodic basis is essential.
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