UNIT 7 CRM AND E-CRM

CRM and E-CRM

UNIT 7 CRM AND E-CRM

Structure NOTES
7.0 Introduction
7.1 Unit Objectives
7.2 What is E-CRM?
7.2.1 Difference between CRM and E-CRM
7.3 E-CRM Strategy and Technology
7.4 Evaluating Service Providers of CRM Software
7.5 Involvement of People
7.6 Employees as Customers
7.7 Summary
7.8 Key Terms
7.9 Answers to ‘Check Your Progress’
7.10 Questions and Exercises
7.11 Further Reading

7.0 INTRODUCTION
The concept of customer relationship management is as old as business itself. A small
business that serves around thousand customers can build and maintain customer
relationships through face-to-face interactions between the staff and the customers.
However, with the increase in business size and number of customers, it becomes difficult
to build and maintain customer relationships and manage customer information quickly.
With the involvement of the Internet in CRM, firms are able to provide a personalized
experience through online help, purchase referrals, quicker turnaround on customer
problems and suggestions through customer feedbacks. The concept of CRM, when
seen in the context of e-business, becomes e-CRM.
For the success of CRM initiatives and applications, an organization requires a
committed workforce. Hence, human resource management (HRM) policies of an
organization must be aligned with CRM ideas and ideology. The role of the HR department
and the HR manager is very crucial for moulding and developing the people in the
organization to understand the reasons, needs and requirements for bringing CRM in the
organization. Structural changes may become necessary to bring new values and work
culture in the organization.

7.1 UNIT OBJECTIVES

After going through this unit, you will be able to:
• Understand e-CRM
• Analyse the benefits of e-CRM strategy
• Evaluate the service providers of CRM software
• Understand the significance of the involvement of workforce in CRM
implementation
• Realize the importance of employees as internal customers of the organization
Self-Instructional Material 89
CRM and E-CRM
7.2 WHAT IS E-CRM?
It is possible to maintain customer relationships only by consistently implementing well-
NOTES proven customer bonding techniques like individualized customer care and communications,
special consideration for high-value customers, rewards for customer value and loyalty,
and customized products and services. However, with increase in the number of
customers, it becomes difficult to implement these techniques. Growth necessitates the
implementation of the best practices in customer relationship management with the use
of sophisticated technology.
This is possible only through proper dissemination of strategic, customer-focused
decisions and information, better known as Electronic Customer Relationship Management
(e-CRM). In other words, e-CRM provides companies a means for conducting
personalized, interactive and relevant communication with customers across both
electronic and traditional channels. It focuses on understanding the effect of customer
relationships on business.
With the help of Information Technology (IT), electronic CRM concentrates on
the management of all forms of relationships with customers. However, it has been
wrongly interpreted by some that e-CRM is an Internet-based CRM. Actually, e-CRM
has a broader scope and focuses on the symbolic relationship of CRM strategy and the
use of electronics for facilitation of the same.
E-CRM integrates traditional CRM and e-business application. It makes possible
for an organization to extend its infrastructure to customers and partners in ways that
offer new opportunities of learning customer needs, gaining new economies, reaching
new customers, adding value, and doing all these in real time. While it might sound very
simple, achieving effective e-CRM is itself a stupendous task. Companies agree that e-
CRM is critical to their business, but unfortunately very few understand exactly what it
is or how to evolve an e-CRM solution from their existing database marketing practices.
7.2.1 Difference between CRM and E-CRM
CRM is a business strategy for creating and sustaining long-term, profitable customer
relationships. A business philosophy aligning company activities around customer needs
is the starting point of a successful CRM initiative. The ability of taking care of customers
via the Internet or the ability of customers to get customer care service online differentiates
between CRM and e-CRM. Consider a local shopkeeper who knew his customers’
names and birthdays. What is new is that, now the shopkeeper can use IT to serve his
customers on a much larger scale.
Thus, e-CRM can be defined as activities for managing customer relationships
with the use of the Internet, web browsers or other electronic touch points. However,
the challenge is to provide information on the right topic and at the right time that fits the
customer’s specific needs.
An AOL Cyber study conducted in early 2000 about online purchasing habits
showed an increase from 31 per cent of the Internet community purchasing something
online in 1998 to 42 per cent of the same group purchasing semi-regularly online in 1999.
The increases were due to more women getting involved. The same behaviour is expected
to drive the percentage even higher because studies conducted in mid-2000 indicate
that, for the first time, Internet users were primarily women (52 per cent). Shifting to the
Web means a significant difference in the way of conducting business as the approaches
90 Self-Instructional Material change with the change in technology.
 CRM and E-CRM
7.3 E-CRM STRATEGY AND TECHNOLOGY
To compete successfully in the present-day high-speed e-business market, e-CRM
systems must be built on top of a technology infrastructure addressing the requirements NOTES
of the new Internet-driven businesses. Successful CRM implementation will lead to the
customer service, sales and marketing people and everyone else in the organization to
have a holistic view of each and every customer. This will help them in making quick and
informed decisions, measuring marketing effectiveness, creating up-selling and cross-
selling opportunities, and delivering personalized customer care.
Not only the integration of information and customer touch points, an E-CRM
strategy also includes the training and empowerment of employees and the automation
of systems that help in customer interactions and communications. Customer relationship
management is not the responsibility of the marketing department only. It is a corporate-
wide practice that requires constant improvement on the company’s ability of treating
customers and prospects in ways that promote loyalty and continued business.
The role of IT is of immense importance and the following functions are expected
to be fulfilled through the use of IT:
1. Capturing data: Capturing the right data from identified sources is important
for successful implementation of e-CRM. The challenge in data capturing is
that it should be in diverse formats, for example, when a customer interacts
with a bank, the following formats of data are generated by using multiple
channels.
• Customer interactions through e-mails
• ATM transactions
• Internet banking transactions
• Phone banking transactions
• Verbal and other written communications with the bank
Therefore, it is quite obvious that the data sources could generate diverse
formats of data.
In the case mentioned above, the ATM transactions and the Internet banking
transactions may be easily captured since they follow structured processes.
On the other hand, e-mail and verbal transactions would generate data that
may require voice recognition software to make the data recognizable to the
system. The accuracy of data is very important for correct valuation and as
such, data captured should be authentic and error free.
2. Assimilating data into databases: The data so captured above then needs
to be incorporated into a database and assimilated. Therefore, databases having
proper design and structure needs to be created as a part of the e-CRM tool.
The database so generated should fulfill the following criteria for successful
implementation.
• It should be robust and should enable transactions as and when desired by
the users.
• It should be useable through standardization across all corporate data sources.
• It should direct application-specific analytical processes in order to target
homogeneous customer segments.
• It should be able to collaborate data from all departmental steering
committees for everything from data mart design to strategy development.
Self-Instructional Material 91
CRM and E-CRM • It should be able to produce strategies for launching marketing campaigns
that successfully integrate information, technology, and customer
communications.
• Customer database should contain accurate, adequate, authentic and up-to-
NOTES date data pertaining to the customers of the organization.
• Future projections for the organization need to be kept in mind while capturing
and designing the formats.
• It should be able to support the number of users and manage the increased
load, i.e., the database should be scalable and be able to cater to the growth
in the business.
• The database should be compatible with the existing IT infrastructure as all
CRM solutions are to be integrated with firm IT infrastructure like data
warehousing, supply chain management solutions, etc.
The database should be secure and the security of database should be ensured.
Credit card operations, for example, are very sensitive and security of
transactions is very important.
It is necessary to identify a connection between customer communication and
the behaviour of a specific customer (or prospect). At times, the information
necessary for testing if a particular communication had any influence on the
behaviour of an individual customer is not fed into the data mart. If, for example,
an individual customer is placed in a specific segment, that customer will
receive a particular message or promotion campaign designed for that segment.
Normally, customer behaviour is tracked and associated with the particular
message or promotion, providing the measurement required for evaluating the
success of the promotion, targeting logic and customer segmentation. The
process of targeting, communicating and evaluating is to be followed for
effective delivery.
A segment code may be presented to the customer and at the beginning he
may be presented with a page of content designed specifically for that segment.
However, based on the behaviour of the customer during web sessions and
the content delivery strategy for the website, the content presented to the
customer may change.
3. Data processing: After devising the CRM strategy, a comprehensive list of
desired outputs may be created. Some of the desired outputs that the system
generates are as follows:
• Customer segmentation: Based on purchase behaviour and demographic
profile, segments of customers may be generated by the systems. These
could be on the basis of product preference, price sensitivity, income, attitude,
etc.
• Customer grievances: Based on customer complaints received from
customers and supplemented with feedback from service personnel, the
points of grievances of customers may be identified through data analysis.
• Customers’ perspective: An organization should view the interaction more
from the customer’s perspective and set the communication process specially
suited to customer’s own environment.
The users should be able to access the system whenever and wherever they
desire. The outputs should be available in real time and with current data to
ensure that they are of maximum use to the users. The executives in the field

92 Self-Instructional Material
 may be required to access the system using mobiles/laptops while working in CRM and E-CRM
the field. The system should therefore be able to generate the outputs on a 24/
7 basis as well as offer the outputs in formats recognizable by all device
users.
4. Methodology for e-synchronization: The methodologies for conducting NOTES
the e-business initiatives need to be decided with careful consideration. The
firm’s strategic objectives at all times should be to decide at what point should
the website be used, meaning thereby whether it will be specific to attracting
new customers, or help customers prior to purchase or coordinate order
fulfillment and delivery, etc. The focus of the company with regard to e-
business should be very clear—what role should the website play in the entire
process?
For the e-CRM initiatives to succeed, the company needs to focus on the
basic areas of delivery as mentioned below.
• IT service providers: The e-CRM system would require sophisticated
hardware, networking and software with constant support from qualified
technicians. As such, it is imperative to have system support offered by
creditable and reputed agencies.
• Content management: The e-CRM system would require content for all
interfaces with customers and these should be created keeping in mind the
education level of the typical customer. Considering the case of our country
where apart from Hindi and English, vernacular languages also play important
roles; here, it may be necessary to develop content in multiple languages.
• Call centre management: Apart from systems, customers may also require
to directly interact with human service agents for conducting various
transactions. Therefore, the company should set up a call centre to offer
customers 24 × 7 immediate services.
• Employee support: The success of customer relationship strategies can
be greatly enhanced by employees who make contact with individual
customers or prospects. E-CRM helps a company to show a unified corporate
front to a customer or prospect at every touch point and to apply a unified
corporate strategy towards that customer.
Consider, for example, a customer identified as having a high risk of defection
and to be of high value. The customer would be offered some special privileges or sent
a message to ‘bond’ the relationship, via direct mail or telemarketing. This approach can
be highly effective as a proactive measure. However, the decision of treating such a
customer in some unique manner should not be only through traditional direct marketing
communications. For e-CRM, this decision must be disseminated to other customer
touch points, even those that are customer-initiated.
Communication channels that can be leveraged include customer service
representatives, sales representatives, collection departments, and other human touch
points. These employees can be highly effective in implementing the CRM strategy if
they have knowledge of the corporate CRM strategy and they are trained to handle
different segments of customers or prospects, as well as have the information required
to understand the types of customers or prospects they are interfacing with. This will
bring down attrition rates, increase customer growth and improve acquisition of high-
value customers. This undoubtedly will result in higher corporate profitability.

Self-Instructional Material 93
CRM and E-CRM
7.4 EVALUATING SERVICE PROVIDERS OF CRM
SOFTWARE
NOTES CRM solutions are today widely available in the market with a host of vendors. Most
CRM strategy management systems are available for specific components of the
corporate customer communication landscape. Systems facilitating sales automation,
customization and personalization of web content, marketing campaign management,
collections, more intelligent operation of help desks and access to customer information
in call centres are available, but it is a complicated task to get them to operate on one e-
CRM strategy by using the same source of customer information and decision process.
Several organizations are, however, making efforts to centralize customer
information and make it accessible, use that information for a better understanding of
the customer, and create the ability of making decisions that impact certain customer
communications.
The products offered by each one of them come with a host of functions and
support services. To compare products offered by each provider is complex and difficult
in the wake of the fact that each of them uses different terminologies to mean the same
thing. The older generation of CRM solution providers might have provided limited
interactivity using only HTML as the standard; newer solutions might provide more
interactive technologies like Java, CGI, ASP, etc. Under such circumstances, to compare
the different products and solutions becomes a little difficult. Some of the functional and
technical requirements of CRM solutions remain the same across all spheres. These are
enumerated below.
• Business intelligence
• Analytical abilities
• Support for web-based functionality
• Centralized repository for both customer and other enterprise information
• Integrated workflow for business rules
• Integration with other ERP and enterprise-wide applications.
• Sales applications - Sales Force Automation (SFA)
• Marketing applications - Campaign Management (CMA)
• Customer Service and Support Applications (CSS)
There is an exhaustive list of CRM solutions providers, but here are a few of them listed
for your reference study.
Siebel CRM on Demand (www.siebel.com; www.crmondemand.com)
Oracle CRM (www.oracle.com
My Sap CRM (www.mysap.com)
People Soft (www. people soft.com)
Microsoft CRM (www.microsoft.com)
Onyx CRM (www.onyx.com)
Talisma (www.talisma.com)

94 Self-Instructional Material
 CRM and E-CRM
7.5 INVOLVEMENT OF PEOPLE
The success of all CRM modules depends upon the involvement of the people in the
enterprise that wants to implement CRM practices. This means that everyone in the NOTES
organization should be wedded to the philosophy of CRM. Total involvement of the
organization is possible only if the leadership is truly committed to CRM beliefs and
values. Hence, giving complete attention to the customers must find the top place in the
vision, mission, goals and objectives of the organization.
Most business organizations these days talk about customer-orientation and
customer-centric approach. However, very few organizations implement these
approaches. The only area that receives greater attention relates to marketing and sales.
Every financial organization is pushing its products aggressively in the market and people
too are buying, but the service aspect is very weak. The customer feels lost and unattended
after the sale is over. Even high net worth customers are getting raw deals at the service
counters. In such a situation, the role of the HR department becomes very crucial.
The first priority of the HR manager is to acquaint the employees and the managers
in the organization with the concept and benefits of CRM. This may also lead to bringing
structural changes in the organization at various levels. Only people committed to the
CRM philosophy who can motivate others should be placed at important CRM positions.
Apart from the employees, there are various other human resources in the form
of distribution channels, call centres, customers’ touch points, business associates
connected with the organization for achievement of the organization’s goals and objectives.
All such wings of the organizations must work in harmony for winning the customer’s
loyalty. The strong and weak areas of CRM practices and operations should be discussed
with organization’s people in a transparent manner. Due rewards and recognitions should
be conferred on people playing prominent and outstanding roles in CRM implementation.
For implementing customer relationship management strategies, software is often
required for exploring the full benefits of a CRM strategy. However, most CRM software
vendors emphasize on the need of a holistic approach for a successful effort. Several
initiatives often fail as CRM implementation remains limited to only software installation.
Organizations do not provide proper awareness and understanding of the CRM philosophy
and related skills and thus employees are not able to learn and take full advantage of the
information systems. Tools for customer relationship management should be implemented
‘only after a well-devised strategy and operational plan are put in place’.
According to Peter Drucker, customer orientation is the key to marketing success.
Earlier, customer satisfaction was the objective of a successful enterprise, but now
customer satisfaction has been replaced by customer delight, jubilation, surprise and
excitement. You have to enchant and thrill the customer.
Respect and courtesy towards customers is not a new idea. This was being
preached for long by reputed and established business enterprises. Let us recollect how
Mahatma Gandhi described a customer:
• A customer is not an outsider to our business. He is a definite part of it.
• A customer is not interruption to our work. He is the purpose of it.
• A customer is doing us a favour by letting us serve him. We are not doing him
any favour.

Self-Instructional Material 95
CRM and E-CRM • A customer is not a cold statistic; he is a flesh and blood human with feelings
and emotions like our own.
• A customer is not someone to argue or match wits with. He deserves courteous
and attentive treatment.
NOTES • A customer is not dependent on us. We are dependent on him.
• A customer brings us his wants. It is our job to handle them properly.’
Unfortunately, there are few organizations that look at customers this way. In
India, many organizations both in the public and private sectors have ignored their
customers and thus paid a heavy price. The basic malady lies within the organizations
where the leadership, employees and all other concerned with the organization have
divergent goals and objectives with no focus on customer care and customer satisfaction.
Unless there is true involvement of people within the organization, proper implementation
of CRM is not possible.
Most CRM vendors advise that a successful implementation of CRM will depend
upon an integrated approach to CRM ideology. However, most initiatives are generally
limited to only software installation without support and training to employees to learn
and assimilate various aspects of CRM systems. A half-hearted approach to CRM can
make the situation worse. Such organizations would not survive for long. Hence, the
first step should be to make people in the industry aware of the benefits of CRM.
Seven sins of service
1. Apathy-indifference
2. Brush off-lack of responsibility
3. Coldness-curtness hostility
4. Condensation-patronizing attitude
5. Robotize-lack of involvement with the customer
6. Rule book-rules above the customer
7. Run around-avoiding issues
Figure 7.1 shows reasons of customer defections.

Check Your Progress

1. What is the need of
e-CRM?
2. What infrastructural
support will be required to
implement e-CRM?
3. Mention the areas in which
IT is used in e-CRM.
4. How can employees help in
the success of customer
relationship management?
Figure 7.1 Customer Defections
96 Self-Instructional Material
 CRM and E-CRM
7.6 EMPLOYEES AS CUSTOMERS
Employees are the backbone of every industry or an organization. A self-motivating
workforce is essential for providing quality service to customers. The prerequisite of NOTES
any successful CRM depends upon the attitude of the employees to such a programme.
It is therefore rightly said that the first customer of any service organization should be its
employees. Only happy and satisfied employees can deliver quality service to their
customers.
The leadership and management will have to play a pivotal role in making their
employees realize the benefits and advantages of successful CRM implementation. A
special force of dedicated people will have to be created to train and motivate the people
in the industry. Structural changes may become necessary at all levels for placing and
allocating the right type of people to carry forward the programme. It will also become
necessary to look at the compensation package of the employees, and efforts should be
made to link it with the performance and success of CRM.
The employees can also be described as internal customers. Organizations having
satisfied employees create satisfied customers. An enlightened management should try
to bring synergy of all the different stakeholders, i.e., the shareholders, financiers, suppliers
and also the society.
Customers’ orientation training programmes should be conducted for employees
at all levels to understand the various facets of CRM and a message should be passed
on to the employees for the need of CRM in the competitive environment and its long-
term benefits. New culture and values should be created for generating a positive and
congenial atmosphere for bringing a customer-centric culture. The best people in the
organization should be allocated to take care of the customers at various customer touch
points.
The achievements and failures in CRM implementations must be shared with the
staff. Transparency and openness on all CRM-related issues will inculcate a feeling of
ownership in the minds of all employees and generate a sense of responsibility for the
cause of CRM at all levels.
A separate budget should be provided to the HR department for training existing
employees in CRM and recruiting new people at all levels who understand the concept
of customer relationship management.
Customers interact with an organization at different levels through various modes
of communications. The employees must be trained how to handle and interact with the
customers. Right types of personnel who love interacting with people should be selected
to deal with the customers. Very specialized training would be required to train the staff
and other outsourced agencies for carrying out these activities. The team selected should
maintain high standards of integrity and professional ethics.
Call centres
A company’s product or service consists of a number of individual elements which
assume responsibility for customer satisfaction. Employees of an organization form the
key strings of the company’s end product. If it is possible to ensure that the internal staff
is committed, motivated and participative then the organization can automatically maintain
a long term binding relationship with its customers. People within the organization, right
from the lowest to the highest ranking level, must integrate towards customer satisfaction
Self-Instructional Material 97
CRM and E-CRM and customer delight. A Customer-centric approach demands participation at a much
deeper level than just a ‘smile’ or ‘thank you’. Customers now want substance to the
service that they are promised, a feeling of complete comfort and delight that significantly
comes from a feeling of belongingness and relationship formation with the products and
NOTES its producers. Customer care has to be a natural outcome of daily practices and not a
bottled up extra.
Employee attitudes and behaviour
Those employees, who are working in positions farthest from the front line or not facing
the customer directly, will generally not think about the customer intuitively. To encourage
them to understand and accept customer preferences, a constant endeavour by way of
communication + training + motivation + empowerment shall have to be formulated
so as to help them achieve desired performance. This will, in turn, churn out an enabled
employee who can then contribute to transforming the behaviour of the team and
improve total employee performance. The enabled employee will also help in producing
more such employees who can think, decide and respond positively to customer needs
irrespective of their job function.
Employee attitudes and behaviour can be classified in situations like the following:
1. When an employee does not know what to do
Communicate: Organizations today are focusing a great deal on customer service as a
route to success as such, each and every employee needs to be involved in the concept
of effective delivery. Listening to customers’ needs and then investing accordingly and
supporting a dedicated internal training programme will yield the required results.
Communication starts right from the induction of an employee when he or she is
first introduced in the company’s work processes. While visiting a Japanese production
plant it is not only the cleanliness and orderliness of the processes that are to be seen, but
also the motivational signs, posters and charts hanging all around the place ensuring
mass communication. Communicating both vertically and horizontally is a critically
important skill that will need to be developed and trained. This will enable the employees
to then contribute intelligently in team leadership. Right communication will involve the
following:
(a) Informing the employee
(b) Promote involvement
(c) Motivate
(d) Enable
(f) Reinforce
2. When an employee does not know how to do it
Training: Training should not be reserved for only those who are found unfit for doing
the job, rather should be aimed to be for one and all. For any worthwhile customer
service initiative, it is imperative that all employees are well trained and competent to
apply their knowledge and skills. While training at a basic level should impart knowledge
to the employee about the particular aspect of the job; and at a wider level it should give
direction to future employees and act more as a mode of communication for the
organization. Training today has imbibed many facets- it can be carried out as formal
presentations or as structured programmes or workshops and seminars together with on

98 Self-Instructional Material
the job management. Training cannot be a onetime activity. There has to be a continuous CRM and E-CRM
and consistent training together with the dedication of individual efforts. In some
organizations, multi skilling has proven to be the success mantra. Employees need to be
trained and retrained at a rate that is directly proportional to their customer interactions
majorly because NOTES
• Every employee must have knowledge of the firm’s products and services.
• To reinforce employee knowledge, skill and attitude
• To maintain parity with customer’s changing needs and demands it is important
for the employee to be versatile.
• All trainings reinforce company’s commitments towards effective delivery
• Training becomes a common ground for sharing of information, ideas, and
experiences.
• Cross functional workings can be elaborated upon in depth in these training
modules
• Employee enablement, which is the prime objective, must be fulfilled.
When an employee does not want to do it?
Motivate: This is a very sensational and emotional topic for both employees and the
company. It is for the organization to see that employees are committed to their goals
and are motivated enough to participate actively in all organizational activities. The sense
of ownership is crucial to success of any process or action in an organization. For
employees to feel motivated, they need opportunities to participate in the management
decision making processes as well as defining the processes. Active participation is in
itself a form of motivation and helps change attitudes and develop a more constructive
workforce.
3. When an employee is energized and wants to participate
Empower: Each employee when assigned a specific arena of functional duty, must be
totally free to take decisions or actions with freedom and authority. Empowering employees
is like helping them to take decision and ensure accountability. The staff should be
empowered enough to take decisions and do the right things to satisfy the customer. The
employees should not be expected to look around for the manager or senior officer
every time a customer has a problem or a complaint. There have been innumerable
examples where employees took decisions that were against the company policies but
that satisfied the customers, with the end result of both business and customer being
happy. Empowering to the extent that the employees are assured of no punishment on
omission shows the confidence in the team to perform to the best of their ability. Already
energized staff when motivated/backed by company support can do wonders for the
organization as his participation levels are very high and he is in a positive frame of mind
to serve customers the best.
The following are some interesting examples of empowerment-
Example 1
One day, two businessmen decided to have a meeting over lunch at Marriott Hotel.
While walking down to the hotel, they both got caught in a heavy downpour and were
wet from top to bottom. The manager saw them all wet and sitting uncomfortably, he
immediately arranged for a guest room, room service lunch and bathrobes. Their clothes
were dried by the time they had their luncheon meeting.

Self-Instructional Material 99
CRM and E-CRM
NOTES
Check Your Progress
5. What was the emphasis of
Mahatma Gandhi’s message
while describing a customer?
6. Employees are the internal
customers. Justify.
7. What kind of role should
the leadership play for the
success of CRM?
8. What type of people should
be selected for interacting
with customers?
100 Self-Instructional Material
Example 2
At the famous Cheese Cake factory outlet in Chicago downtown, a couple sat unattended
for sometime while all guests in the nearby seats were already served with their food.
The manager noticed this lapse, and he approached the couple and offered to give them
his personal service. Further to this, he compensated them with a desert at end of the
meal, bearing the expenses of the same on himself.
Example 3
A guest at Trident Hotel lost some money in a vending machine, so he asked a cleaner
passing by on how to report the broken machine. Without hesitation, and thought, the
cleaner returned the money lost by the gentleman and promised to report the problem
immediately.
Here is how empowerment has affected decision making in these examples
• With empowerment comes ‘involvement’, which means each worker and
employee is concerned about the well-being of both customer and the
organization as seen in Example 1.
• To make mistakes is human, but to learn from mistakes and modifying human
behaviour accordingly is more important, as seen in Example 2. In Example 3,
the cleaner is equally empowered to take decisions in the interest of the
organization, reflecting that empowerment need not be level oriented i.e. only
for supervisors and managers.
• Empowering has helped employees in taking immediate decisions
• Empowerment has built confidence in employees to manage by exception
• Empowerment has helped emphasize and place customer and customer care
as the topmost priority.
• Empowerment has established clear lines of support
An organization may create call centres as contact points for the customers. A
call centre is a place that has adequate telecom facilities, trained personnel, access to
Internet, wide databases other online support to provide information and support to
customers and business.
The call centres are also known as contact centres and are a mix of low tech and
latest telephony and online technology. They must identify well with client’s values even
though not being direct employees of the organization. They should be positive thinkers
and high on learning and ready to admit mistakes. The mission should be to resolve
customers’ problems.
An integrated approach to CRM is essential. This means that all the wheels of a
business organization should move together towards achieving the long-term goals of
providing high-quality technology-based service to the customers through a team of self-
motivated people, both inside and outside the organization, for the profitability of the
company based on sound principles of ethics.
Various definitions of CRM
CRM may be viewed from various angles as stated below, but customer must always be
the focus. It can be looked as:
• Caring relations management
• Continuous relations management
 • Creative relations management CRM and E-CRM

• Customer retention management

• Customer return management
• Cost reduction management NOTES
• Cost and return management

7.7 SUMMARY
In this unit, you have learned about e-CRM and how it helps in the present-day
e-business market. E-CRM provides companies a means for conducting personalized,
interactive and relevant communication with customers across both electronic and
traditional channels. It focuses on understanding the effect of customer relationships on
business. To compete successfully in the present-day high-speed e-business market,
e-CRM systems must be built on top of a technology infrastructure addressing the
requirements of the new Internet-driven businesses. Successful CRM implementation
will lead to the customer service, sales and marketing people and everyone else in the
organization to have a holistic view of each and every customer. E-CRM is a corporate-
wide practice that requires constant improvement on the company’s ability of treating
customers and prospects in ways that promote loyalty and continued business.
The success of all CRM modules depends upon involvement of the people in the
enterprise that want to implement CRM practice. Employees are the backbone of every
industry of an organization. A self-motivating workforce is essential for providing quality
service to the customers. The prerequisite of any successful CRM depends upon the
attitude of the employees to such a programme. It is therefore rightly said that the first
customers of any service organization should be its employees. Only happy and satisfied
employees can deliver quality service to customers.
The first priority of the HR manager should be to acquaint the employees and
managers in the organization about the concept and benefits of CRM. This may also
lead to bringing structural changes in the organization at various levels. Only people
committed to CRM philosophy who can motivate others should be placed at important
CRM positions.
An integrated approach to CRM is essential for achieving long-term goals of
providing high quality service to the customers through a team of self-motivated people.

7.8 KEY TERMS

• Electronic CRM: The activities to manage customer relationships by using the
Internet, web browsers or other electronic touch points.
• E-business: The conduct of business over the Internet.
• Human resource management: The function within an organization that focuses
on recruitment, management and providing direction to people who work in the
organization.
• Call centre: A place that has adequate telecom facilities, trained personnel, access
to the Internet, wide databases and other online support to provide information
and support to customers and businesses.

Self-Instructional Material 101

CRM and E-CRM
7.9 ANSWERS TO ‘CHECK YOUR PROGRESS’
1. E-CRM makes possible for an organization to extend its infrastructure to customers
NOTES and partners in ways that offer new opportunities of learning customer needs,
gaining new economies, reaching new customers, adding value and doing all these
in real time.
2. E-CRM systems will require sophisticated hardware, networking and software
with constant support from qualified technicians.
3. In e-CRM, IT is used for the following:
a. Capturing data
b. Assimilating data into databases
c. Data processing
4. The success of customer relationship strategies can be greatly enhanced by
employees who make contact with individual customers or prospects. E-CRM
helps a company show a unified corporate front to a customer or prospect at
every touch point and apply a unified corporate strategy towards that customer.
5. Mahatma Gandhi emphasized that a customer is not an outsider to a business; he
is a part of it and deserves courteous and attentive treatment. He further stated
that by serving a customer the organization is only helping itself as he (the
customer) is the source of income and livelihood of everyone in the organization.
6. The prerequisite of any successful CRM depends upon the attitude of the employees
to such a programme. It is thus said that the first customer of any service
organization should be its employees. Only happy and satisfied employees can
deliver a quality service to their customers.
7. The leadership and the management should play a pivotal role in making their
employees realize the benefits and advantages of successful CRM implementation.
A special force of dedicated people will have to be created to train and motivate
the people in the industry.
8. Personnel who love interacting with people should be selected to deal with
customers. They should maintain high standard of integrity and professional ethics.
They must identify well with clients’ values. They should be positive thinkers and
high on learning and ready to admit mistakes. Their mission should be to resolve
the customer’s problem.

7.10 QUESTIONS AND EXERCISES

Short-Answer Questions
1. Define e-CRM.
2. Differentiate between CRM and e-CRM.
3. Why are call centres important for successful e-CRM?
4. Name some CRM solution providers.
5. How much should be the involvement of people in successful implementation of
CRM?
6. Why do organizations fail to successfully implement CRM?
102 Self-Instructional Material 7. What is the need of a customers’ orientation training programme?
Long-Answer Questions CRM and E-CRM

1. Discuss the role of IT in e-CRM.

2. Describe the basic areas of delivery on which a company should focus.
3. Explain the importance of people in the successful implementation of CRM. NOTES
4. An integrated approach to CRM is essential. Discuss.

7.11 FURTHER READING

Shahjahan, S. 2004. Relationship Marketing: Text and Cases. New Delhi: Tata
McGraw-Hill.
Mukerjee, K. 2007. Customer Relationship Management: A Strategic Approach to
Marketing. New Delhi: Prentice Hall of India.
Sheth, J. N. 2001. Customer Relationship Management. New Delhi: Tata McGraw-
Hill.

Self-Instructional Material 103