A COMPARATIVE STUDY OF CRM

PRACTICES OF SBI and ICICI

INTRODUCTION
MEANING
Customer relationship management (CRM) is
a system for managing a company's
interactions with current and future
customers. It involves using technology to
organize, automate and synchronize sales,
marketing, customer service, and technical
support

Definition
Customer Relationship Management (CRM) is the
establishment, development maintenance and
optimization of long-term mutually valuable
relationships between consumers and the
organizations. Successful customer relationship
management focuses on understanding the needs
and desires of the customers and is achieved by
placing these needs at the heart of the business by
integrating them with the organizations strategy.
People, technology and business processes.
History of CRM
A CRM system consists of a historical view and
analysis of all the acquired or to be acquired
customers. This helps in reduced searching
and correlating customers and to foresee
customer needs effectively and increase
business.
EVOLUTION OF CRM IN BANKING SECTOR

Regulation and technological improvements are
responsible for the vast majority of innovations in
banking over the past quarter century.
The introduction of personal computers and the
proliferation of ATMs in the 1970s captured bank
managements attention. The regulatory changes
in the 1980s fueled much of the industrys
growth, then downsizing as bankers focused on
amassing market presence which resulted in
significant merger activity.
EVOLUTION OF CRM IN BANKING
SECTOR
Recent technological improvements are at the root
of bankers focus as well as a target for their
significant investment dollars today. In fact,
according to recent projections, bankers and their
financial service company would spend almost $7
billion this year on CRM and increase that by 14
percent each year for then next several years.
Benefits of CRM

Benefits of CRM can be categorized into three groups namely:
Benefits for customers, benefits for employees and benefits
for banks.
(i) Benefits for Customers
There is a more coordinated and professional approach to
customer contact.
With up-to-date customer information, Banks can offer
more personalized services.
Customers feel empowered if they have greater access to
products and services. For example 24 Hours banking.
Targeted product and service offerings can be timed to
coincide with customer events and requirements e.g.,
Education Loans and Tourism Loans.

Benefits for Employees

Employees are empowered with the
information to deliver high quality service and
meet
customer expectations
Employees have more time to serve
customers.
Employees have higher satisfaction ratings.


Benefits for Banks

Managers are empowered with information that
can help them manage customer relationships
and make better decisions.
Optimum use of resources.
Customer satisfaction and increased loyalty.
Improved customer acquisition and cross-selling.
It helps in capitalizing on short windows of
opportunities in the market.

CRM LEVELS

CRM practice involves understanding the
customer, understanding the organization, and
continuously improving service quality. Done
well, the firm acquires, retains, and nurtures
the right customers based on an
understanding of their needs and their long-
term value to the firm. Increased value of the
customer base reflects in increased
shareholder value.
Introduction of Innovative Services in
banks through CRM

Banks have made several
innovations by using the
CRM System such as:
The introduction of ATMs.
Biometric ATMs.
Single Window Service.
Teller System.
Internet Banking
Introduction of Plastic
Money: Credit Card, Debit
Card, Smart Card.
Mobile and E-Mail Alerts
Electronic Cash
Introduction of two in one
Accounts.
Introduction of new loan
schemes as per the
customers needs viz.
Education Loans, Marriage
Loans, Housing Loans,
Personal Loans, Vehicle
Loans, Furniture Loans,
Renovation Loans and
Tourism Loans.
IMPORTANCE OF CRM
Customer relation management is the most
efficient and strongest approach which helps
in creating and maintaining relationship with
customers. It not only pure business but also
develop strong personal bonding with the
customers. These kind of bonding drives the
business to new success levels.
Importance of CRM
In CRM system, customers are grouped
according to different aspects according to the
type of business they do or according to
physical location and are allocated to different
customer managers often called as account
managers. This helps in focusing and
concentrating on each and every customer
separately.
NEED OF RELATIONSHIP WITH
CUSTOMERS
Better customer perceptiveness
Lead to Customer Satisfaction
Lead to Customer Loyalty
Lead to Customer Retention
Changes of getting referrals
Growth in revenue
Cost to serve is low
BACKGROUND OF SBI
The State Bank of India is India's largest
commercial bank. The bank has been striving
sincerely to adhere to the efforts of providing
utmost customer satisfaction to the best
possible extent.
BACKGROUND OF SBI
The Government of India nationalized the
Imperial Bank of India in the year 1955, with
the Reserve Bank of India taking a 60% stake,
and name was changed to State Bank of India.
In the year 2001, the SBI Life Insurance
Company was started by the Bank.

BACKGROUND OF SBI
The Bank traces their ancestry to British India,
through the Imperial Bank of India, to the
founding in 1806 of the Bank of Calcutta,
making them the oldest commercial bank in
the Indian Sub-continent.
BACKGROUND OF SBI
They are the only Bank that have been
permitted 74% stake in the insurance
business. The Bank's insurance subsidiary 'SBI
Life Insurance Company' is a joint venture with
Cardif S.A in which Cardif holds 26% of the
stake. During the year 2005-06, the bank
introduced 'SBI e-tax' an online tax payments
facility for direct and indirect tax payment.





































INTRODUCTION TO ICICI BANK

The Industrial Credit and Investment
Corporation of India Limited (ICICI)
incorporated at the initiative of the World Bank,
the Government of India and representatives of
Indian industry, with the objective of creating a
development financial institution.




INTRODUCTION TO ICICI
ICICI Bank Ltd is a major banking and
financial services organization in India. The
Bank is the second largest bank in India and
the largest private sector bank in India by
market capitalization. They are a publicly
held banking company engaged in providing
a wide range of banking and financial
services including commercial banking and
treasury operations.
INTRODUCTION TO ICICI
The Bank and their subsidiaries offers a wide
range of banking and financial services
including commercial banking, retail banking,
project and corporate finance, working capital
finance, insurance, venture capital and private
equity, investment banking, broking and
treasury products and services.
INTRODUCTION TO ICICI
They offer through a variety of delivery
channels and through their specialized
subsidiaries in the areas of investment
banking, life and non-life insurance, venture
capital and asset management. The Bank has a
network of 2,035 branches and about 5,518
ATMs in India and presence in 18 countries.

INTRODUCTION TO ICICI
ICICI emerges as the major source of foreign
currency loans to Indian industry. Besides
funding from the World Bank and other multi-
lateral agencies, ICICI was also among the
first Indian companies to raise funds from
international markets.


INTRODUCTION TO ICICI
ICICI Lombard was conferred the coveted
'Porter Prize' award in the category 'Creating
Shared Value'. Porter Prize is one of the most
prestigious awards in the field of strategy and
competitiveness.


INTRODUCTION TO ICICI
The award bestowed by the Indian Institute of
Competitiveness and named after Professor
Michael E. Porter recognizes ICICI Lombard's
efforts in achieving responsible economic
success in the area of mass and micro
insurance for the economically weaker
sections of the society.

Review literature

Love Kumar Patwa ,Kush Kr.Patwa studied that Customer Relationship
Management (CRM) performance &evaluates its collision on customer
retention between the Private and Public Banks of Uttar Pradesh. CRM
means, edifice an interdependent relationship with the customer in whom
each relies on the other for business solutions and successes. It came into
the power when banking industry were getting more ,more competitive and
shield its market share and boost growth. From the Bank's point of view, it
is the management process or approach of acquiring, retaining and
growing. SPSS Package was applied to compile and analyze the data. Major
Factors taken from various researches to analysis their importance and
Stratified random sampling technique used for administrating the
questionnaire. Results bring out that the Private Banks have been able to
implement the CRM practices more effectively. However, a micro analysis
reveals that the Public Banks have highest scores in terms of reliability and
assurance. The analysis of the results suggests that the banks (whether
Public or Private) are equally affected by the kind of CRM initiatives they
undertake.

Mehdi Rouholamini et al studied that a successful CRM strategy
cannot be implemented by only installing and integrating software
packages in banks. A strong banking industry is important in every country
and can have a significant effect in supporting economic development
through efficient financial services. Iranian banks have rapidly introduced
innovative banking technologies and e-banking services in recent years.
The barriers of CRM in the public and private banks of Iran are
significantly high and private sector had high level of progress than public
sector regarding to
application of CRM.

Sanjay Kantidas (2012) studied about Customers are the focal point in
the development of successful marketing strategy. Marketing strategies both
influence and are influenced by consumers affect and congnition, behavior
and environment. In the banking field a unique Relationship exists between
the customers and the bank. But because of various reasons and
apprehensions like financial burdens, risk of failure, marketing inertia etc.,
many banks are still following the traditional ways of marketing and only few
banks are making attempts to adapt CRM. It is with this background, the
researcher has made a modest attempt towards the idea that CRM can be
adapted uniformly in the banking industry for betterment of Banking
Services. The lack of understanding on Customer Relationship Management
(CRM) is always a concern among the service providers especially banks.
Banks have their own way of managing their relationships with the
customers. However, the perception of customers on CRM practices among
banks should also be taken into consideration.


Here in this paper, effort is given to study the comparative perception of
SBI customers and other nationalized banks customers in the issue of CRM
practices. It is observed that the approach of CRM by SBI and other
nationalized are to some extent same and one but the reach is quiet
distinguishable. It is due to the profile, their capability and the strategy of
CRM in making it and reaching down to customers. On the contrary, it can
also be asserted that the background of both banks also found as a big
cause for reaching the top CRM. Hence, CRM is an inevitable tool of
marketing that can be considered as Critical Responsibility of Market with
regard to Banks in present context.

M.Malla reddy A.suresh (2012) studied that the banking industry in
India has undergone radical changes due to the liberalization and
globalization measures undertaken since 1991. Today, Indian banking
industry is one of the largest in the world. State Bank of India is the
largest public sector bank in India. There has been a great surge in
efficient customer service. A highly satisfied and delighted customer is a
vital nonfinancial asset for the banks in the emerging IT era. Customer
Relationship Management (CRM) provides interactive, personalized and
relevant communication with customers to develop and maintain
relationships. CRM is a tool to retain the 20% customers who give 80%
of the revenue. This paper explores the perception of Customer
Relationship Management with respect to the Customers of State Bank
of India in Karimnagar district of Andhara Pradesh. The study is based
on the responses of 20 customers of State bank of India branches in
Karimnagar district.
Hui-I Yao, Kok Wei Khong(2011) has studied three purposes: to
conceptualize and operationalize the CRM implementation in commercial
banks in Taiwan: to determine whether the CRM implementation in
commercial banks in Taiwan: to determine whether the CRM
implementation is positively associated with customer satisfaction; and to
determine key moderators between CRM implementation and customer
satisfaction. Findings revealed that CRM implementation is associated
with customer satisfaction; and there are significant interactions amongst
IT capability, contact rate management and recovery management with
customer satisfaction. A regression model was churned to evaluate the
criteria to measure the level of CRM implementation on customer
satisfaction.

Dheeraj Verma, Devendra Singh Verma opined that today in the
highly competitive market, increasing customer demands retail outlets
realize the importance of customer relationship management. The lack of
understanding on Customer Relationship Management (CRM) is always a
concern among the service providers especially retail outlets, retailers have
their own way of managing their relationships with the customers. Under
this case study of CRM Practices in Selected organized retail outlets in
Indore city discusses about strategies adopted, retail outlets can hold the
customer relationship. Understand the contribution of CRM of the retail
outlets with respect to its objectives. The aim of this case study finding &
identify these issues impact on customer expectations through
implemented CRM retail outlets can improve the relationship with
customers.
Sarita Bhatnagar(2012) studied that Customer Relationship
Management has become inevitable for growth and profitability of Banks
in present scenario marked by rising competition, technological
advancement and empowered customers. The CRM practices are adopted
to generate better understanding of the customer for product
development, segmentation, appropriate targeting, campaign
management and maintenance of long term profitable and mutually
beneficial relationships with customers. In Indian banking customer
Relationship Management is still at a nascent stage. A very small
proportion of its potential has been utilized. The concept has been
implemented on a limited scale. The paper investigates the impediments
to successful implementation of CRM. An attempt is made to chart out a
strategic framework to realize the benefits of Customer Relationship
Management.

Jayakumar , Sathiya studied that Banks play a vital role in the socio-economic
development of our country. Banks offer several facilities to enhance the standard
of living of our citizens. In the past, owing to lack of information and proper
guidance, the general public could not avail the full benefits from the banking
industries to improve their standard of living. In is now undeniable that the face of
the Indian consumer is changing. This is reflected in the change in the income
pattern of the urban household. The direct fallout of such a change will be the
consumption patterns and hence, the banking habits of Indians, which will now be
skewed towards retail-products. At the same time, Indian compares pretty poorly
with the other economies of the world that are now becoming comparable in
terms of spending patterns with the opening up of our economy.

Customer service management is a key component of business today. The
concept is very crucial as it incorporates customer, customer service,
customer satisfaction, customer value, customer loyalty, customer retention
etc. In one word, it is linked to Customer Relationship Management (CRM)
and Customer Experience Management (CEM). So far as jargons are
concerned, more or less relationship Marketing, CRM and customer service
management are interchangeably used. Relationship marketing attracts
maintains and enhances customer relationship.
Ms. Nisha Malik, Mr. Chand Prakash Saini (2012) studied that CRM is
an effort to examine the relationship between service quality and customer
satisfaction of two private sectors bank of India. Service quality has been
described as a form of attitude that results from the comparison of prospect
with recital (Cronin and Taylor, 1992, Parasuraman etal, 1985). Gronroos (1982)
argued that customers, while evaluating the quality of service, compare the
service they expect with perceptions of the services they actually receive. Since
financial products offered by various banks are similar by nature then why any
particular bank of product of any bank is preferred than others a matter of
interest for academician as well as banking industry. They may be difference
between customers of public and private sector banks, but why are two banks
of one sector being preferred differently by customers. This research study is an
effort to find out the answer of these questions.
M.Murugan,Dr.S.Senthil Kumar studied that regardless of services context
customers expect service provider to be courteous usually ,most
conversation begin or end with a courtesy expression and includes some
form of personal connection content. The important point is that sociality
communication can play a pivotal role in moving the provider and
consumer for mere encounters to higher degree of relation. A study was
conducted among 100 respondents to find out the CRM functioning and
effectiveness of the ICICI Bank in Thiruvannamalai.
Research Gap

CRM is considered as a tool or software to a great extent and
implemented rather than understanding customer perception.

There is need to have more understanding which CRM can play a
significant role in organisation to improve the business and performance.

Employee perceptions are important for company in formulating
competitive strategies .Very few studies emphasised the importance of
employee perceptions in service sector especially Banking Sector.
OBJECTIVES
1. To study the needs and importance of CRM practices in
Banking Sector
2. To compare and analyze the various CRM practices adopted
by SBI & ICICI.
3. To study the perceptions of customers about CRM practices
of SBI & ICICI.
4. To study the perceptions of employees about CRM practices
of SBI & ICICI.
5. To understand the impact of CRM practices on service
quality in SBI and ICICI.


Hypotheses of the study

H: There is no difference between CRM
practices adopted by SBI and ICICI

H: CRM practices adopted by SBI and ICICI have
no impact on service quality.
SCOPE OF THE STUDY
The present study aims at studying the needs and
importance of CRM practices in Banking Sector, to
compare and analyse the various CRM practices
adopted by SBI Vs ICICI, to analyze the
perceptions of customers and employees about
CRM practices a of SBI Vs. ICICI, and to
understand the impact of CRM practices service
on quality in SBI and ICICI. Further, the study
includes in its scope only two regions i.e.
Hyderabad and secunderabad.

SOURCES OF DATA
Primary Data
The present study proposes to make use of both primary
and secondary sources of the data. For data collection, a
well-defined structured questionnaire is developed as a
research instrument aimed to analyze the needs and
importance of CRM practices in Banking Sector, the various
CRM practices adopted by SBI Vs.ICICI.

To analyze the perceptions of customers and employees
about CRM practices of SBI Vs. ICICI, and to to
understand the impact of CRM practices on service quality
in SBI and ICICI in Hyderabad and Rangareddy regions.


SECONDARY DATA
The secondary data will be collected from the
Annual reports of State Bank of India and ICICI,
newspapers, magazines and journals.

SOURCE OF DATA
SAMPLE SELECTION
For the purpose of the study, 500 account
holders will be selected from Hyderabad and
secunderabad region who are having savings
bank account in SBI and ICICI. Out of which,
250 customers from each bank will be
selected adhering to the principle of stratified
random sampling.In addition to stratified
random sampling, proportionate sampling will
also be used.


DATA ANALYSIS
Simple averages, percentages will be used for
analyzing the data. Further, a Chi-Square test will
be used to analyze the perception of the needs
and importance of CRM practices in Banking
Sector, the various CRM practices adopted by SBI
Vs.ICICI, to analyze the perceptions of customers
and employees about CRM practices and
strategies of SBI Vs. ICICI, and to understand the
impact of CRM practices on service quality in SBI
and ICICI. Further, the study includes in its scope
only two regions i.e. Hyderabad regions.

It is therefore crucial for both the enterprises
themselves and for the economy as a whole that they are able to gain and
develop
their competitive advantages. In a situation when the competitive
landscape is
changing, due to globalisation, the development of the ICT, and a change
in
consumer behaviour, that those marketing practices, which worked in the
past, may
turn out to be less successful in the future. The adoption of a CRM
approach,
including its emphasis on ICT enabled marketing practices, is a means of
remaining
competitive and also in developing new competitive advantages in this
new
competitive landscape.

For the purpose of the study 50 employees
each will be selected from SBI and ICICI in
Hyderabad and secunderabad region
adhering to the principle of convenient
sampling.




State Bank Of India has the following branches
in Hyderabad district. List as follows,
Administrative Office Ii Hyderabad, Agri
Commercial Branch, Arora Colony, Artillery
Centre, Chandanagar Hyderabad, Chintal, City
Centre Hyderabad , Currency Administration
Cell Hyderabad, Cyber Gateway, Dd Colony
Bagh Amberpet, Doordarshan Road Branch,
Erragadda, Fslo Hyderabad, H C U Admin, Hni
Branch, Jubilee Hills Yuva Branch, Kothaguda
Hyderabad, Lanco Hills Hyderabad, Liberty
Centre Himayatnagar, Madinaguda Hyderabad,
Malkajgiri, Mehdipatnam Garrison, Nagaram,
Nanakramguda, Nri Branch Jubilee Hill,
Pragathi Nagar Branch, Rbo Nalgonda, Rbo
Warangal, Rcpc Ramachandrapuram, Saidabad,
Sanjeevareddy Nagar, Sardar Patel Nagar,
Smeccc 2 Kukatpally, Spl Cash Admn Branch,
Srinagar Colony, Triveni Complex Branch
Hyderabad, Vaidehinagar, Vasundhara Jubilee
Senorita Banking Centre, West Marredpally, Zio
Hyderabad.