Chapter 10: Building a Customer-Centric Organization CRM

Learning Outcomes

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BUILDING A CUSTOMER-CENTRIC ORGANIZATION CUSTOMER RELATIONSHIP MANAGEMENT

CHAPTER 10

Learning Outcomes
1. Compare operational and analytical customer relationship management Identify the primary forces driving the explosive growth of customer relationship management Define the relationship between decision making and analytical customer relationship management Summarize the best practices for implementing a successful customer relationship management system
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Chapter 10: Building a Customer-Centric Organization CRM

Customer Relationship Management (CRM)

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CRM enables an organization to:

Provide better customer service

Make call centers more efficient

Cross sell products more effectively

Help sales staff close deals faster

Simplify marketing and sales processes

Discover new customers

Increase customer revenues

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Chapter 10: Building a Customer-Centric Organization CRM

Customer Relationship Management (CRM)

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Organizations can find their most valuable customers through RFM

Recency, How recently a customer purchased items

Frequency,
How frequently a customer purchased items

Monetary value How much a customer spends on each purchase

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Chapter 10: Building a Customer-Centric Organization CRM

The Evolution of CRM

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Three phases in the evolution of CRM:-

reporting analyzing predicting

CRM reporting technology help organizations identify their customers across other applications

Chapter 10: Building a Customer-Centric Organization CRM

The Evolution of CRM

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Three phases in the evolution of CRM:-

reporting analyzing predicting

CRM analysis technologies help organization segment their customers into categories such as best and worst customers

Chapter 10: Building a Customer-Centric Organization CRM

The Evolution of CRM

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Three phases in the evolution of CRM:-

reporting analyzing predicting

CRM predicting technologies help organizations make predictions regarding customer behavior such as which customers are at risk of leaving

Chapter 10: Building a Customer-Centric Organization CRM

The Evolution of CRM

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Three phases in the evolution of CRM:-

Chapter 10: Building a Customer-Centric Organization CRM

CRMs Explosive Growth

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CRM Business Drivers

Chapter 10: Building a Customer-Centric Organization CRM

Using Analytical CRM to Enhance Decisions

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Operational CRM supports traditional transactional processing for day-to-day front-office operations or systems that deal directly with the customers Example: customer service, sales, billing Which systems are more important to an organization? front-office or back-office

Analytical CRM supports back-office operations and strategic analysis and includes all systems that do not deal directly with the customers Example: Accounting, Finance, Human resources, Data warehouses

Chapter 10: Building a Customer-Centric Organization CRM

Customer Relationship Management Success Factors

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CRM success factors 1. Clearly communicate the CRM strategy

ensuring that all departments and employees understand exactly what CRM means and how it will add value to the organization is critical to the success of the implementation

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Define information needs and flows

the organization must understand all of the different ways that information flows into and out of the organization to implement a successful CRM system. If the organization misses one of the information flows, such as a customer service Web site, then none of that information from that Web site will be integrated into the CRM system and the company will not have a complete view of its customers

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Build an integrated view of the customer

the CRM system must support the organization's strategies and goals

Implement in iterations
avoid the big-bang approach and implement in small, manageable, pieces

Scalability for organizational growth

ensure the system can support the organization's future growth
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Chapter 10: Building a Customer-Centric Organization CRM

Summary

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Operational CRM supports traditional transactional processing for day-to-day front-office operations or systems that deal directly with the customers. Compare operational and analytical customer relationship management Analytical CRM supports back-office operations and strategic analysis and includes all systems that do not deal directly with the customers.

The primary difference between operational CRM and analytical CRM is the direct interaction between the organization and its customers.

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Chapter 10: Building a Customer-Centric Organization CRM

Summary

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The primary forces driving the explosive growth of CRM:Identify the primary forces driving the explosive growth of customer relationship management Automation/Productivity/Efficiency Competitive advantage, Customer demands/requirements, Increase revenues, Decrease costs, Customer support, Inventory control, Accessibility

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Chapter 10: Building a Customer-Centric Organization CRM

Summary

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Define the relationship between decision making and analytical customer relationship management

Analytical CRM solutions are designed to dig deep into a companys historical customer information and expose patterns of behavior on which a company can capitalize. Analytical CRM is primarily used to enhance and support decision making and works by identifying patterns in customer information collected form the various operational CRM systems.

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Chapter 10: Building a Customer-Centric Organization CRM

Summary

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Summarize the best practices for implementing a successful CRM system

CRM success factors include: clearly communicate the CRM strategy , define information needs and flows, build an integrated view of the customer, implement in iterations, scalability for organizational growth

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