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1. NATURE AND SCOPE OF CRMThe Customer is King! This credo is more powerful, relevant and true today than ever before. In atruly customer driven economy, success depends on a company's ability to be with the customer ona round the clock basis… satisfying all their product and service specific needs. Simply stated,Customer Relationship Management (CRM) is about finding, getting, and retaining customers.Customer Relationship Management is one of the hottest and most talked about topics in theindustry today and for good reason. Industry analysts recently reported that CRM expenditures willgrow from $2.8 billion in 1999 to $11 billion by 2003.CRM is all about building long term business relationships with your customers. It is best describedas the blending of internal business processes: Sales, Marketing and Customer support withtechnology. CRM solutions empower businesses to more efficiently and effectively manage theactivities that affect their relationship with their customers. The ultimate goal of CRM is to meet andexceed customer expectations, create a positive customer experience and build customer loyalty.CRM changes all of this and represents a continuing evolution in managing front office operations.With CRM, traditional departmental applications for sales, marketing and customer service areconsolidated into a single unified system capable of managing the entire customer life cycle. Thisapproach allows employees throughout an organization to have immediate access to a completeprofile of important customer information. Organizations who are implementing CRM solutions feelconfident that providing access to this level of information will assist their sales and support staff inbetter understanding the needs and buying patterns of their customers.CRM (customer relationship management) is an information industry term for methodologies,software, and usually Internet capabilities that help an enterprise manage customer relationships inan organized way.CRM is at the core of any customer-focused business strategy and includes the people, processes,and technology questions associated with marketing, sales, and service. In today's hyper-competitive world, organizations looking to implement successful CRM strategies need to focus on acommon view of the customer using integrated information systems and contact centerimplementations that allow the customer to communicate via any desired communication channel.What exactly is the definition of Customer Relationship Management? Ask a dozen professionals, geta dozen different definitions. Here's a general overview:CRM is used to learn more about
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your key customers needs in order to develop a strongerrelationship with them.Customer Relationship Management can be defined as a companies activities
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related to increasingthe customer base by acquiring new customers and meeting the needs of the existing customers.CRM is about building partnerships with your customers. It uses internal business processes fromSales, Customer Service and Marketing.The philosophy of CRM is the recognition that your
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long-term relationships with your customerscan be one of the most important assets of an organization, providing competitive advantage andimproved profitabilityThe most important part of CRM is the "customer-focus".
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 CRM uses technology, strategic planning and personal marketing techniques to build a relationshipthat increases profit margins and productivity. It uses a business strategy that puts the customer atthe core of a companies processes and practices. It requires this customer focused businessphilosophy to support effective sales, marketing, customer service and order fulfillment.Regardless of company size or industry, businesses have begun to recognize the value andimportance of customer retention and are embracing new technology for automating customerservice and support. For the new millennium, it seems that the customer has finally become King!!!WHY CRMKeeping in mind the pace at which technology is changing today, any company which is a stepahead of others because of some web product or service will not be able to hold on to thatadvantage for long. Key to stability in today's dynamic marketplace is forging long-termrelationships with the customers.Customers can be divided into three zones:1. Zone of defection where customers are extremely hostile and have the lowest level of satisfaction.2. Zone of indifference where customers are not sure. They have a medium level of satisfaction andloyalty towards the company.3. The third level of customers is in the zone of affection described as "Apostles". CRM focuses on
 
bringing customers from level 1 to level 3 and retaining apostle customers.Customer demands for customization is increasing with every passing day. This has madecompanies shift their focus from "mass production" to "mass customization". The present scenarioof companies using "poorly implemented" multi channel strategies for living upto the expectations of customers is bringing both customer satisfaction and customer loyalty down the ladder.Today any company can copy products or services offered by other companies. If the new entrantadds features like less order turn around time and direct communication then established playersare bound to have sleepless nights. Organizations that implement CRM and turn their business intoe-businesses will find their competitors' customers ready to welcome them with a "smile".Take the example of a small enterprise. Here hard work reaps high quality service and over theyears develops a database of loyal customers. In this enterprise computers are optional. Then whyis the CRM industry attracting investments of millions and billions of dollars? The reason is simple.The concept of "Seller's Customer" has just rotated 180 degrees to become "Customer's Seller".This simply states that, now the customer is more powerful than the seller. Options for customershave increased with the cycle of innovation-to-production-to-obsolescence gaining momentum. Onthe other hand companies are finding it difficult to differentiate them in the marketplace. Thesefactors are pushing companies into taking a closer look at their customer relationships.Organizing business to satisfy customer demands organizes/simplifies internal functioning of theorganization. Implementing CRM brings to the front the "pits" that the organization had dug overthe years, passing work from one pit to another. Workflows are reduced, cycle times becomeshorter, information flow of non-productive things gets eliminated and the most important thing -"pits" get covered automatically with all the positive features. Compact sized organizations get intoa position of making more money. This in turn enables them to please more customers.For large enterprises, CRM has become a strategic initiative because of its potential for increasedrevenues and improved customer service. Smaller businesses are forging ahead as well, and areusing CRM solutions to capture and share customer information across multiple departments and job functions.The top four reasons for implementing CRM are:• gaining customer confidence and loyalty• providing personalized service to customers• acquiring better knowledge of customers and their buying habits• differentiating themselves from the competitionChapter # 2BIRTH OF CRM"CUSTOMER FOR LIFE THROUGH SYSTEMS AND SMILES".- MR. MAHESH. DADLANICUSTOMER RELATIONS, ORANGE2. BIRTH OF CUSTOMER RELATIONSHIP MANAGEMENTThroughout the 90s businesses were focused on improving internal operations. CEO’s tried to
 
distinguish their company through operational excellence and product innovation. Middlemanagement focused on automating departmental functions such as sales and help desk support.They believed that automation and better management of their sales and customer service processwould lead to increased revenue and customer satisfaction. Vendors were all to happy to supportthis belief and raced to the scene with independent solutions for sales force automation, help deskand customer service functions. While many of these applications provided increased productivity,the approach of using independent solutions to address departmental needs served only to createdislands of information and database duplication. Furthermore, the lack of system integration andworkflow between these departments meant that vital customer information was unavailable tosales and support personnel without jumping from system to system. This did little to support crossselling opportunities or increase customer satisfaction.By the time customers walk into your business - or log-on to your website or call your sales center -most already know what they want and how much they're willing to pay. With easy access tomountains of information, today's customers do their homework, and they now have the upper handin most purchase transactions.In response, sellers are bending over backwards to improve offerings and services. However, ratherthan adopt a streamlined "you-want-it-we've-got-it" approach, sellers have created a marketplacewhere products and services are sold, serviced and marketed in an increasingly fragmented andultimately frustrating way.Never before has so much "clutter" bombarded consumers from so many online and offline sources.Trying to be all things to all buyers, sellers face a harsh reality that brings an old adage to life: Youcan please some of the people most of the time and most of the people some of the time, but youcan't please all of the people all of the time.It wasn't supposed to be this way. Customer Relationship Management (CRM), which swept throughthe business landscape in the early 1990s, brought the promise of helping sellers please most of thepeople most of the time. Riding the coattails of customer satisfaction would come increasedorganizational efficiency and, better still, increased revenues.That dream has been slow in coming. While incremental improvements have occurred, CRM has notyet delivered its ultimate promise - the transformed customer experience.Yes, companies have implemented call centers and sales force automation software and customersales representative training. However, while improving the sales and service components of customer transactions, companies have largely ignored the very piece required to attract customersin the first place. It's the piece that ensures sales and service efforts are effective and integrated.It's the piece that allows sellers to segment and analyze their customer information in order tocreate a more personalized, long-term relationship. It's the piece called "marketing" (see Figure 1).Figure 2.1 - Completing the CRM visionWe're not saying that the last decade's investment in CRM has been wasted. Quite the contrary:what began as a solution for providing more efficient customer transactions evolved into a processby which companies could foster more meaningful customer interactions (see Figure 2). This wasthe right direction to take. However, companies haven't reached the end of the CRM road. Today,the challenge is to take this evolution one step farther - to focus on building lasting and profitablecustomer dialogues at all interaction and transaction touch points to build customer and brandvalue.Figure 2.2: Evolution of CRMAs CRM evolved, many companies assumed that just bolting on new technology (e.g., client/server,call centers, salesforce automation software, data warehouses, etc.) or adding new services wouldenhance customer relationships. This assumption was as pernicious as it was false. After all, youcan't sell what people don't want to buy, no matter how efficient and service-oriented your saleschannel. And as for gathering customer insights, be careful what you wish for. Many companiesfaced the unsettling paradox of having advanced data availability and analytic techniques thatquickly outpaced their ability to absorb and apply the information. They were left with sophisticatedtools that offered little real value.The belief is that the third wave of CRM will bring about the ultimate transformation of customerexperiences - not just by strengthening sales and service or even promoting interactions with yourcustomers - but by creating a series of "intelligent conversations" that build over time into a long-
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