Factors Influencing Towards Successful Implementation of CRM Systems in Local Commercial Banks in Sri Lanka

A Study of Factors Affecting Towards the Implementation of Customer Relationship Management Systems in Local Commercial Banks of Sri Lanka
Module Code and Title BLB00096 3 Investigations
Submitted By:
Archchana Vekneswaran
Intake Code: GF11 B1BA
Submitted to the Business School In partial fulfillment of the requirements for the degree of Bachelors of Arts (Hons) in Business Administration
Supervised By: Prof. Kennedy Gunawardena
Staffordshire University 25th June 2012, Colombo
CRM Implementation in Local Commercial Banks
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ABSTRACT
This study analyses the factors which contributes towards the successful CRM system implementation in locally established commercial banks of Sri Lanka. Maintaining effective relationships with the customers is of great importance in todays context for commercial banks due to intensified competition from the external forces such as dynamic nature of the environment and evolvement of technology. Bankers have to consider various factors when it comes to CRM in the context of technological systems such as internet banking, ATM, mobile banking etc. The major objectives of this report are to identify the extent computerized operations in banking, to identify the current barriers to CRM implementation in banks, to identify factors affecting towards the implementation of successful CRM, to figure out the relationship between factors and successful CRM implementation, and to provide possible recommendations to overcome issues. The main factors identified for analysis are technological orientation, customer centricity, external competitive pressures, top management support and leadership, employee behaviour and financial aspects. Under literature review the above factors were elaborated in the context of financial sector institutes like commercial banks. Under methodology conceptual framework was developed based on the review of literature. Stratified random sampling method was adopted to select the sample from the local commercial banks which has implemented CRM technology in their current operations. Proposed statistical methods of the previous researches are also included for investigation. Key words: Customer Relationship Management, Technology
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ACKNOWLEDGEMENT
Author would like to thank her Research Methods lecturer Prof. Kennedy Gunawardane for his continuous support and guidance in the preparation the research proposal. Also the author is thankful to Dr. Mahesha Samarathunga, for directing them in the correct path regarding citation and references. Author also wishes to extend her gratitude to Dr. Vellnambi and M.Karunanithy for their help and support to identify topic related articles from Sri Lankan context. The author is also wishes to thank the librarian. Author also wishes to thank all the branch managers for spending their time to fill in the questionnaires. Author is also grateful to fellow batch mates and friends for their encouragement and support when facing difficulties. Author owes quite a lot to her family who provided the chances to fulfill her career objectives and great support throughout the studies. Author would like to dedicate this study to them as an indication of their significance in this study as well as in her life. Lastly, the author offers her regards to all those who supported her during the completion of this report. The author is responsible for any errors that remain in this report.
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TABLE OF CONTENTS
ABSTRACT......................................................................................................................................2 ACKNOWLEDGEMENT ................................................................................................................3 TABLE OF CONTENTS..................................................................................................................4 LIST OF TABLES ............................................................................................................................5 LIST OF FIGURES ..........................................................................................................................6 LIST OF ABBREVIATIONS ...........................................................................................................7 CHAPTER 1: INTRODUCTION TO THE STUDY ........................................................................8 1.1 Introduction .............................................................................................................................8 1.2 Problem Statement ..................................................................................................................9 1.3 Problem Justification ..............................................................................................................9 1.4 Objectives of the study............................................................................................................9 1.5 Significance of the study ...................................................................................................... 10 1.6 Scope and Limitations of the study ...................................................................................... 10 CHAPTER 2: LITERATURE REVIEW ....................................................................................... 11 2.1 CRM and Banking Sector A Technological Stance .......................................................... 11 2.2 Applications of CRM ........................................................................................................... 11 2.3 Electronic Banking in Sri Lanka: Prospects and Constraints............................................... 12 2.4 Challenges ahead for Sri Lankan commercial banks which could impact CRM technology adoption ..................................................................................................................................... 13 2.4.1 ICT revolution and impact on banking ......................................................................... 13 2.4.2 Challenges posed by globalization................................................................................ 14 2.4.3 Race for adopting new technologies ............................................................................. 14 2.5 CRM Implementation .......................................................................................................... 15 2.6 Literature on Hypothesis Variables...................................................................................... 16 CHAPTER 3: RESEARCH METHODOLOGY ........................................................................... 25 3.1 Conceptual Framework ........................................................................................................ 25 3.2 Hypothesis Development ..................................................................................................... 26 3.3 Population and Sampling ..................................................................................................... 28 3.4 Proposed Statistical Methods ............................................................................................... 30 Asia Pacific Institute of Information Technology 4
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4. DATA ANALYSIS .................................................................................................................... 32 4.1 Data Collection Methodologies ........................................................................................... 32 4.1.1 Primary Data ................................................................................................................. 32 4.1.2 Secondary Data ............................................................................................................. 33 4.2 Data Analysis ........................................................................................................................ 34 4.2.1 Objective 1 .................................................................................................................... 34 4.2.2 Objective 2 .................................................................................................................... 48 4.2.3 Objective 3 .................................................................................................................... 54 4.2.4 Objective 4 .................................................................................................................... 64 4.2.5 Objective 5 .................................................................................................................... 67 CONCLUSION .............................................................................................................................. 69 APPENDICES ............................................................................................................................... 70 REFERENCES .............................................................................................................................. 80
LIST OF TABLES
Table 1: List of Hypothesis ............................................................................................................ 27 Table 2: Proposed Statistical Models ............................................................................................. 31 Table 3: Reliability of the statistics ................................................................................................ 33 Table 4: Growth of LCB Branches in Sri Lanka ............................................................................... 35 Table 5: Growth of Domestic LCB branches in Colombo ............................................................... 36 Table 6: Telecommunication Services Trend in Sri Lanka 2001 - 2009 .......................................... 38 Table 7: Features of Different Forms of E-Banking ........................................................................ 40 Table 8: Trend of ATMs in SL ......................................................................................................... 41 Table 9: Credit Card Transaction Trends........................................................................................ 42 Table 10: Trend of Value per Transaction - Credit Cards ............................................................... 42 Table 11: Debit Card Transactions of LCBs in SL ............................................................................ 43 Table 12: EFPOS Trends of LCBs in SL ............................................................................................ 44 Table 13: Online Banking Trends in SL ........................................................................................... 45 Table 14: Mobile/Tele Banking Trends of LCBs in SL ..................................................................... 45 Table 15: Composition of Electronic Payments ............................................................................. 46 Table 16 - Awareness and Use of Electronic Banking Solutions .................................................... 48 Table 17: Legislations governing E-Banking Transactions ............................................................. 50 Table 18: Operational Risks of E-Banking Solutions ...................................................................... 51 Table 19: Barriers in E-CRM Implementation in LCBs of Sri Lanka - Primary Data ........................ 53 Table 20: Mean and Standard Deviation Statistics of Variables .................................................... 54 Asia Pacific Institute of Information Technology 5
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Table 21: Frequency Table for Technology Orientation ................................................................ 54 Table 22: Frequency Distribution Table for Customer Centricity .................................................. 56 Table 23 : Frequency table for External Competitive Pressures .................................................... 57 Table 24: Frequency table for Top Management Commitment and Leadership .......................... 58 Table 25: Frequency Table for Employee Behaviour ..................................................................... 60 Table 26: Frequency Table for Financial Aspects ........................................................................... 61 Table 27: Frequency table for Successful CRM Implementation ................................................... 62 Table 28: Correlation of Technological Orientation and CRM Implementation ............................ 64 Table 29: Correlation of Customer Centricity and CRM Implementation ..................................... 64 Table 30: Correlation between External Competitive Pressures and CRM Implementation ........ 65 Table 31: Correlation between Top Management Commitment and CRM Implementation ....... 65 Table 32: Correlation between Employee Behaviour and CRM Implementation ......................... 66 Table 33: Correlation between Financial Aspects and CRM Implementation ............................... 66
LIST OF FIGURES
Figure 1: Conceptual Framework .................................................................................................. 25 Figure 2: Sample Selection ............................................................................................................. 28 Figure 3: Population and Sampling................................................................................................ 28 Figure 4: Response Level for Distribution of Questionnaires ........................................................ 32 Figure 5: Banking Density of All the Banks by District - 2011 ........................................................ 34 Figure 6: Growth of LCB Branches in Sri Lanka .............................................................................. 35 Figure 7: Expansion of Commercial Banks and No of Commercial Bank Branch Density per 100000 for SL .............................................................................................................................................. 36 Figure 8: Growth of Domestic LCB's in Colombo District............................................................... 37 Figure 9: Total Number of Domestic LCB branches in Colombo in 2011 (Population of the Study) ....................................................................................................................................................... 37 Figure 10: Telecommunication Trends in Sri Lanka (2001-2009) .................................................. 39 Figure 11: Evolution of E-CRM Solutions of Sri Lanka .................................................................... 40 Figure 12: Trend of Value per Transaction - ATM .......................................................................... 41 Figure 13: LCB ATMs per 100,000 people ...................................................................................... 41 Figure 14: Credit Card Operations per 100,000 people ................................................................. 42 Figure 15: Trends of Debit Cards Issued and Transactions ............................................................ 43 Figure 16: Trend of value per transaction via EFTPOS ................................................................... 44 Figure 17: Trend in transaction via online banking sites of LCBs ................................................... 45 Figure 18: Trend in Mobile/Tele banking Transactions ................................................................. 46 Figure 19: Composition of Non Cash Transactions ........................................................................ 46 Figure 20: Transaction cost for bank Vs E-CRM Solutions ............................................................. 47 Figure 21: Risks involved in Internet Banking ................................................................................ 49 Figure 22: Histogram for Technology Orientation ......................................................................... 55 Figure 23: Histogram for Customer Centricity ............................................................................... 56 Asia Pacific Institute of Information Technology 6
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Figure 24 : Histogram of External Competitive Pressures ............................................................. 57 Figure 25: Histogram for Top Management Commitment and Leadership .................................. 59 Figure 26: Histogram for Employee Behaviour .............................................................................. 60 Figure 27: Histogram for Financial Aspects ................................................................................... 61 Figure 28: Histogram for Successful CRM Implementation ........................................................... 63 Figure 29: Solution Model for Successful CRM Implementation ................................................... 68 Figure 30: Sample Representation of LCBs .................................................................................... 75 Figure 31: Location Representation in the sample ........................................................................ 75 Figure 32: Private Vs Government Banks Representation in the sample ...................................... 76 Figure 33: Gender of the respondents........................................................................................... 76 Figure 34: Age Composition of the Sample ................................................................................... 77 Figure 35: Educational Qualifications of the Sample ..................................................................... 77 Figure 36: Customer Base of the Samples ..................................................................................... 78 Figure 37: Annual Revenue of the Sample Branches ..................................................................... 79
LIST OF ABBREVIATIONS
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CHAPTER 1: INTRODUCTION TO THE STUDY

1.1 Introduction
In todays context customers are becoming increasingly sophisticated and demanding for better product or service which is often referred by the phrase Customer is the King. For any industry customers have become their main focal point. This emerging trend has lead to the concept of Customer Relationship Management (CRM). Technology plays a vital role in such context to manage customer profiles and to maintain long term stable banking relationship. Banking operations has increasingly become customer centric now days. Competition has intensified among the retail banks to create customer loyalty by escalating usage of customer details and offering customized services. Banks started to use CRM technologies such as internet banking, mobile banking, e-mails, call centers etc to provide an enhanced service experience to their customers. In global context, 83% of customers are satisfied with internet banking, and 79% prefer ATMs (E & Y, 2011). Call centers are not that preferred and 42% of the customers never used mobile banking (E & Y, 2011). Customers demanding for more personalized services from call centers and require more availability of ATMs and user friendly internet banking sites (E & Y, 2011). Even though most of the matured markets have sophisticated technological infrastructure, customers reliability drop questions on rebuilding trust soon after the credit crunch in 2008. In Sri Lankan context, Commercial banks heavily started following international trends in adopting CRM technologies in banking. Banks offer similar CRM solutions as in the global scenario to provide services anywhere and at anytime. Sri Lanka experienced a phenomenal growth in ICT over last two decades which is evident through the large penetration of 68 mobile phones per 100 people (Economic Review, 2011). Even though the internet usage rate stays at 8.3% (Internet world stats, 2011) these developments shows a strong potential for the providing of CRM solutions via e-banking, m-banking etc (Economic Review, 2011). These facilities were mostly used by commercial customers where as ATM has been the most popular CRM solution (Economic Review, 2011). Customer awareness on above facilities are very minimal as they were not publicized
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(Economic Review, 2011). It is evident that CRM related technologies are new phenomenon in Sri Lanka.
1.2 Problem Statement

What are the factors affecting towards the implementation of CRM in local commercial banks and how to overcome those barriers?
1.3 Problem Justification

Its the foremost challenges for commercial banks to acquire capacity to serve its clientele efficiently. Efficiency refers to offering requested service on time, at superior quality and in competitive prices. To improve the reach for their customers, one possibility is banks should increase their market presence by opening various branches. Even though this serves the issue, administration cost and having skilled staff in all branches is really expensive and ROI will be very low. This would erode the viability of having branches. Limiting only to physical location would place barriers in future expansions for a bank. So multi channel integration has become tremendously important feature of a bank to meet customer expectations. Due to this CRM systems have been an important feature of commercial banks in Sri Lanka. Even though emergence of technical CRM tools has bought tremendous customer insights there seems to be issues in successfully adapting to fully fledged CRM services due to various reasons. These issues are low in the context of foreign commercial banks operating in Sri Lanka due to the significant difference in the customer segment to which they serve and also due to the sophisticated systems they have. So the locally established commercial banks has to combat by determining and overcoming factors influencing towards successful CRM implementation to sustain their customer focused market presence.
1.4 Objectives of the study

1. To identify the extent of computerized operations in local commercial banking sector. 2. To identify the existing CRM implementation barriers in local commercial banks.
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3. To identify factors affecting to the successful CRM implementation to the local commercial banks. 4. To find out the relationship between factors affecting to the successful CRM implementation to the local commercial banks. 5. To make suitable recommendation to overcome the CRM implementation barriers.
1.5 Significance of the study

The beneficiaries of the report would be the local commercial banking institutions in Sri Lanka. The barriers and possible recommendations would help the bankers to develop strategies to overcome current barriers in future. More focus on these technological CRM would improve their performance in as it would give more insight to customers contact to develop customized services in future. This research could act as a guiding tool to avoid failures in CRM implementations. Shareholders of the local commercial banks could also be benefited as successful CRM implementation would increase the reach of the bank and thereby increases level of transaction which would lead to better revenue stream. As this could improve the shareholder wealth the study would be useful from investors perspective. There would be an insight to the ICT sector firms as CRM solution were developed and installed by them. This research could give indication as to what a bank should necessarily include in its CRM solution in the case of internet banking, mobile banking etc. Employees of local commercial banks would be benefited through increased efficiency in customer interactions. Customers would be benefited at the end as well due to improved reach in financial solutions from local commercial banks.
1.6 Scope and Limitations of the study

The study will only look into the 40 branches of locally established commercial banks which use CRM application and do not focus on foreign commercial banks. The area of study will be limited to Colombo district only. The study will limit the identification of factors on CRM only related to technology aspect or software applications and not the traditional face to face customer relationship. Only limited factors appropriate to Sri Lankan context would be considered for analysis.
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CHAPTER 2: LITERATURE REVIEW

2.1 CRM and Banking Sector A Technological Stance
CRM as concept has been a topic which has been looked at by the researchers globally. It is one of the fastest growing business trends in the world (Raman et al, 2006). Haq et al (2010) states Customer Relationship Management (CRM) is extensively accepted as an effective tool to collect, analyzes, and translates precious customer information into managerial action. Another point of view of CRM as Silva (2006) says, CRM is a combination of business processes and technology that seeks to understand a companys customers from multiple perspectives to competitively differentiate a companys products and services. CRM could be seen as a method to indentify, convert, acquire and retain customers (Silva, 2006). Traditional customer relationship would be only limited to front office face to face contact but this situation has changed to greater extent over time with emergence of technologies. With the deployment of ICT tools financial sector firms such as commercial banks faced a paradigm shift to technology driven CRM practices. One main factor influenced towards this was banks once faced data rich and information poor situation. Analytical tools were required to analyze customer profiles to improve their cross selling and up selling opportunities to improve growth and profitability (Campbell, 2003). Financial firms have been able leverage maximum knowledge out of IT - CRM solutions to customize their service offering to match the exact needs of customers through tracking of information (Campbell, 2003).
2.2 Applications of CRM

Perspectives of CRM soft ware technologies could exist in the following three ways: 1. Operational CRM: The business processes and technologies that help improving the efficiency of day-to-day customers operations and this include sales and service automation. This service is provided through many channels such as phone, e-mail, fax etc (OBrien and Marakas, 2006). It provides a uniform view of the customers to deliver better services (OBrien and Marakas, 2006).
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2. Collaborative CRM: It provides easy collaborations between the firm and its customers and improves efficiency towards service delivery. This would provide greater responsiveness throughout the value delivery chain (OBrien and Marakas, 2006). 3. Analytical CRM: This concerns customer data analysis to improve business decisions. It includes data warehouse systems, customer profiling, reporting, analysis and data mining. These analatytical techniques help to improve customizations for a customers required needs (OBrien and Marakas, 2006).
2.3 Electronic Banking in Sri Lanka: Prospects and Constraints

Together with unprecedented innovations in ICT coupled with finance sector liberalization electronic applications are emerging in Sri Lanka (Colombage, 2011). Electronic banking is offered in different platforms such as internet banking, telephone banking, mobile banking, mobile money etc (Colombage, 2011). The use of electronic banking such as online banking and phone banking has shown emerging trend in Sri Lanka (Colombage, 2011). Commercial banks and other specialized banks started offering virtual banking which includes the services such as balance enquiry, check status, stop payments, bill payments, inward remittance and fund transfers (Colombage, 2011). Due to growth of telecommunication facilities offered most of the population has mobile phone and this has created the potential for m-banking which has been offered by most of the financial sector firms (Colombage, 2011). Even though the computer literacy level shows exception 40% compared to other developing countries still the adoption or knowledge on internet/ mobile banking is very limited (Colombage, 2011). 70% of the population has some knowledge on ATM usage and most of ultra poor migrant workers have knowledge on electronic remittance facilities (Colombage, 2011). A larger proportion of the population states that they have very low savings in the banks which lead to low mobile banking transactions (Colombage, 2011). Even though technical infrastructure and literacy rate shows potential for technological CRM aspect,
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still the adoption rate from customers perspective especially from rural population is really low and has to be improved through initiatives from the financial sector firms.
2.4 Challenges ahead for Sri Lankan commercial banks which could impact CRM technology adoption
In a developed millennium era there are various challenges impacting the entire banking system. In the past with manual human driven systems bankers didnt had to worry on developing an entire system. One bankers failure did not matter for the rest of the banks (Wijewardana, 2011). But todays perspective banks are interrelated by electronic mean and one banks failure may lead to shocks to the entire financial system (Wijewardane, 2011). With fierce competition from global financial market and new technology introductions, banks have to be vigilant enough to avoid competition from smart operators who are flexible enough to combat challenges (Wijewardane, 2011). Deputy Governor of CBSL, identifies 4 main challenges that could impact the current banking models. They are, 1. ICT revolution 2. Challenges posed by globalization 3. The race for adoption of new technologies (Wijewardane, 2011) 2.4.1 ICT revolution and impact on banking Looking back at the last 50 years of banking sector, it could be said banks are the mostly benefited institutions which gained most of the benefits of ICT revolution with the deployment of high end modern computers with enormous processing capacity and advanced communication platforms to interact with customers to fulfill their needs (Wijewardane, 2011). The applications of high end ICT software and technology had benefited banks to a greater extent to cut costs and also to surpass location barriers and helped them to improve their outreach capability. Universal banking services were able to be provided under one roof (Wijewardane, 2011) The emerging challenges in this arena require banks to focus more on ICT applications than on other inputs for service offering. This is mainly because the types of services
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demanded by customers and the speed at which it has to be offered cannot be done with effectiveness without the application of ICT systems (Wijewardane, 2011). 2.4.2 Challenges posed by globalization According to Wijewardane (2011), Benefiting from the advancements in ICT and the opening of economies to free trade, the globalization process has now encompassed the whole world in an unprecedented manner. With the application of ICT, human intelligence and competence could be acquired from any part of the world without any barriers what so ever. This is popularly named as outsourcing or off shoring (Wijewardena, 2011). These techniques were majorly used by banking firms. The challenge from this perspective is that competition would intensify between local and foreign banks operating in Sri Lanka and quality improvements and lower pricing would become a mandate requirement (Wijewardane, 2011). This would also require banks to look deeper and deeper into their R & D to come up with modern solutions to sustain the competition (Wijewardane, 20111). The major challenge could be an active partner in the globally competitive financial services providers (Wijewardane, 2011). If the services offered is only limited to domestic arena the banks would lose to global competition from international giants of banking (Wijewardane, 2011). 2.4.3 Race for adopting new technologies The salient feature of ICT is it would become obsolete within very few months since its inception. Bankers continuously needs to deploy sophisticated yet user friendly systems to meet customers acceptance but this is not that eas y (Wijewardane, 2011). Bankers who implemented sophisticated systems would sooner find that their system has been outdone by their competitor. When profit margins are reducing due to competitions it would be that easy to small scale banks to invest another lot of money into a system (Wijewardane, 2011). This would raise a question on the banks survival in the fight for supremacy. This has become a serious issue to current banking sector firms (Wijewardane, 2011).
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Tennakon (2011) foresees the commercial banks which understand the market dynamics, perceive threats, anticipate volatility, and perceive threats, shows high degree of professionalism and dynamism amidst the competition would only survive in the future. State banks have to restructure themselves by benchmarking their service standards to improve competitive position (Tennakon, 2011). Bankers has to publicize their alternative banking services to the branch banking to the general public so that the there would be a potential for more adoption rate than now. Trust building has to be offered to build trust.
2.5 CRM Implementation

As stated by Piscar and Faganel (2009), CRM begins with strategic decision to change or improve business process in the organization and to invest into an improved information system. Top management commitment and introduction of project manager are of significantly important features (Piscar and Faganel, 2009). CRM should not be seen as just a solution but it should be carved as strategy to capture the customers mind. Successful CRM strategy would involve a series of steps. Various academicians researched on how to develop a successful CRM strategy into the company. Crocket and Reed (2003) proposes the following. 1. Strategic context: The organization should be able to understand how CRM fits into the context of the companys overall business strategy. 2. Capabilities assessment: The assessment is to be done to confirm the companys current CRM capabilities. 3. Business case development: Company needs a good reason to implement CRM other than new technology fever. 4. Implementation plan creation: Create and execute a plan, which clearly indicates how to reach the goal and execute it. Wijewansa (2011) says that most of the CRM initiatives face failures dues to taking CRM as just a technology. Losing focus on customers, poor integration between departments, employee buy-in, low quality of data etc also contributes towards the failures of CRM (Wijewansa, 2011).
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2.6 Literature on Hypothesis Variables

Factors influencing towards successful CRM implementation in local commercial banks of Sri Lanka
Various
contributing
factors
which
would
influence
towards
CRM
systems
implementation has been analyzed by many researchers. Out of which following factors are been selected for the analysis of Sri Lankan position. 2.6.1 Relationship between Technological Orientation and Successful CRM Implementation In a banking context, as said by Day (1994 cited Rapp et al 2009) the coordination of activities is considered as one of the mastering capability, process and skill to develop customer linking ability to enhance the performance of the firm As per Rapp et al (2009), CRM technology orientation is viewed as an activity-coordinating mechanism that enables a firm to better understand its customers, collaborate with them and develop timely responses to their needs. Technological capability of a firm can be defined as information technology applications that are mostly designed to support customer relationships (Rapp et al, 2009). Many CRM facilities have emerged over time which helps the firms to provide enhanced services, marketing and sales etc through ways such as sales force automation, data warehouses, campaign management, content management, contact centre management, telesales, and data analysis (Peelen et al, 2009) data integration and collaboration with external parties (Jayachandran et al, 2005 cited Rapp et al 2009) etc. Depending on the banking requirements, functionality, and desired outcome CRM could be tailored and adopted to meet banking needs (Raman et al, 2006). For a technology to be successful users ability to use it has significant impact on its success (Raman et al, 2006). There has to be a customization option and training for the better adoption of CRM systems (Raman et al, 2006). Technology and task fit is an essential feature of CRMs success (Speier and Venkatesh, 2002). Payne and Frow (2006) emphasizes on the fact that multi channel integration is an important element in the success of CRM. This involves the decisions about how to ensure that the customers reached the maximum benefit out of the CRM systems. This revolves around developing single view customer
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interaction points such as m-banking, internet banking, call centers etc (Payne and Frow, 2006). By figuring out the fact that various resources have to be combined to develop an idiosyncratic ability (Rapp et al, 2009) scholars say that technological orientation towards CRM would establish multi dimensional construct which not only comprises the technology but also the complementary resources (Rapp et al, 2009). Bharadwaj (2000) suggests that IT infrastructure combined with human resources and IT enabled intangibles would provide improved performance of the organization. Most of the firms rely on ICT for the realization of CRM benefits (Peelen et al, 2009). Even though integrated CRM application would increase the ability to manage customer encounters (Bitner et al, 2000) the adoption rate of these solutions still remain at low rate (Peelen et al, 2009). Considering the above facts a relationship could be formulated between technological orientation of local commercial bank in Sri Lanka and successful CRM implementation. Hypothesis 1: Technological orientation of the commercial bank positively influences successful CRM implementation.
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2.6.2
Relationship
between
Customer
Centricity
and
Successful
CRM
Implementation According to Deshapand et al (1993 cite Rapp et al 2009), Kohli and Jaworski (1990 cited Rapp et al 2009), Customer centricity is the organization-wide gathering, sharing, and use of intelligence about customers, and coordinated actions based on that intelligence. In order to deliver value to the customers, value creation process should be able to transform into strategy development process into programs which deliver the exact expected value to the customer (Payne and Frow, 2005). As the transactions now become more customers centric instead of only transactions, the overall life cycle experience has to be from services, communications, price rates offered. These elements should create positive impact on customer to make them loyal and referrals for future prospects (Peelen et al, 2005). Given the fact that CRMs treats customers as its main focal point it is essential to consider customer centricity as the banks distinctive firm level resource (Rapp et al, 2009) while analyzing the conceptual model. Banks as one of the service oriented firms should have a customer centric organizational culture embedded in each of its activities. According to Deshapand et al (1993 cited Rapp et al 2009), Organizational culture is the deeply embedded beliefs and values that affect a firms choice of outcomes and guides the norms and behaviors towards reaching the outcomes. So customer centric culture guides the firms attitude towards achieving both strong customer relationships and the development of core capabilities leading towards the target (Rapp et al, 2009). Day (1994 cited Rapp et al 2009) says that firms which are customer oriented posses the cultural characteristics that enable them to diagnose their current capabilities, anticipate future capabilities and redesign processes to support new ones. Rapp et al (2009) recognizes customer orientation as a specific instance of market sensing which allows firms to accurately anticipate changes in their markets and respond through development of new customer focused capabilities. Taking in to consideration the fact that service providers provide their services as per the requirements made by their customers. Therefore, it is almost possible to interact or integrate the customers in this
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process. Actually in this field almost the entire parts of the service making process are done or designed by the service providers. More than that, customers make a permanent control of the process and consequently involve indirectly in it by insisting their specific requirements. This system would be institutionalized by the presence of a technician in the factories of the service providers. When working new and difficult procedures, these technicians take the role of a consultant by finding common solutions and by giving advices to the workers. All these procedures are sustained by a permanent interaction between the service providers and the customers. In the view point of Narver and Slater (1990 cited Rapp et al 2009) it could also be concluded the fact that customer centricity allows a firm in managing durable relationship with customers which is also influenced by the customer oriented culture. Hypothesis 2: Customer centricity of the commercial bank positively influences successful CRM implementation.
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2.6.3 Relationship between External Competitive Pressures and Successful CRM Implementation As mentioned above in section 2.4, evolvement new technology has created intense competition in the banking industry has created many challenges to make CRM software an essential feature to have in the business operations. As per Wijewardanes (2011) comments a banking institute would lose its market position if it hasnt reacted to the competing factors regarding technology adoption. Past research papers suggest that higher the uncertainty in a firms environment higher the influence on firms adoption rate of IT (Rapp et al, 2009). Eisenhart and Martin (2000 cited Rapp et al 2009) say that firms would require more assets and capabilities while operating in turbulent environment than in a stable environment. That is when the firms environment is more dynamic and fast changing the management would just focus on existing assets and would try to build competitive advantage but only when an environment becomes more competitive and when there is an essential need emerges to adhere to the market trends and quickly respond to the changing market firms would try to adopt essential features such as CRM systems (Rapp et al, 2009). Day (1994 cited Rapp et al 2009) suggests that firms with capabilities to afford resources that could help in communications, activity coordination, and collaboration with customers are well equipped to respond to the changes in the market. Rapp et al (2009) says that given that customer linking capability represents a critical capability that connects a firm to its customers, we argue that the value of establishing durable relationships with customers will be greater in dynamic environments than in more stable environments.
Hypothesis 3: External competition for commercial bank positively influences successful CRM implementation.
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2.6.4 Relationship between Top Management Support and Leadership and Successful CRM Implementation According to Campbell (2003), senior management involvement refers to the processes by which top management signals its support for the generation and integration of customer knowledge within the firm. Campbell (2003) stress the point that the management has to develop its own strategic vision to implement CRM successfully. A research of Campbell (2003) gives the following conclusions regarding senior management involvement in implementing CRM systems. Managers stressed that support and guidance of senior management is very essential for gaining knowledge competence of customers via CRM adoption where senior management has articulated a vision around CRM adoption and it has been clearly disseminated (Campbell, 2003). In order to maintain a strong customer relationship requires strong strategic vision which could create a focus on what is required to be maintain strong CRM practices (Peelan et al, 2009). These would explain the customer oriented values of the firm which could be transferred to the employees to make it a reality (Peelan et al, 2009). Having a prominent vision only doesnt give sustainability for a firm but this CRM vision has to be integrated to IT and marketing strategy (Glazer, 1997 cited Peelan et al 2009). CRM strategy refers to ways in which the firm translates its vision a reality. A CRM strategy would help to translate CRM vision into operational result often referred to as customer centricity (Peelen et al, 2009). This gives direction to all parts of an organization to work towards its vision (Peelen et al, 2009). Hung et al (2009) states that people at the highest levels of an organization would have an impact towards the resource allocation and adoption of new innovation. He further elaborates that senior executives in the organizations are critical persons to determine organizations attitude towards innovation (Hung et al, 2009) as they are major policy makers of the company. This characteristic of the top management would be really important for implementing CRM as they are the leaders of the overall vision of CRM.
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An interesting research carried out by Ko et al (2007) implies that CEOs characteristics influences the implementation stage of the CRM system. CEOs age and education level would impact the adoption process. Younger the CEO and higher the likelihood the he would accept and implement the CRM system and vice versa (Ko et al, 2007). Hypothesis 4: Top management support and leadership for commercial bank positively influences successful CRM implementation.
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2.6.5
Relationship
between
Employee
Behaviour
and
Successful
CRM
Implementation Employees are an effective part in CRM implementation. Possible training has to be given to make them act in line with CRM strategy of the overall organization. Employee resistance should be handled in such a way to avoid misinterpretations and to avoid any interruptions. Sufficient staff empowerment has to be given to delight customers and essential rewards and motivations have to be given to build up positive attitude in employees mind set (Wijewansa, 2011). Human factors are critical in the process of implementing CRM to a firm as even though well defined the technology and best the processes are, still human relativity plays a dominant place (Mendoza et al, 2007 cited Morena et al 2011). Morena et al (2011) says This is why factors such as employee training and motivation and the establishment of appropriate reward systems will be determinant in employees involvement in implementing this type of strategy. Hung et al (2009) gives a similar argument saying that lack of skill and technical knowledge would often delay the innovation options. Staff should have a positive attitude towards technicality in the opinion of Ettlie (1990 cited Hung et al, 2009). According to Campbell (2003) says that it is increasingly being acknowledged that the challenge of realigning employee behaviour closely parallels the challenge of realigning customer behaviour. Behaviour specific shown a significant positive motivation on employees and could be listed as one of the effective CRM implementations indication (Campbell (2003). But managers increasingly showed difficulties in improving their customer focused rewards schemes (Campbell, 2003). When proper reward incentives were not provided, systems started to show adequate or outdated information due to changed mindset of the employees (Campbell, 2003). Employees showed a negative attitude/reluctant towards when they had to learn something new and complicated (Campbell, 2003). Many firms facing to find out the ways in which they could cross train their employees to make them conveniently work with CRM systems (Campbell, 2003).
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Hypothesis 5: Employee Behaviour for commercial bank positively influences successful CRM implementation.
2.6.6 Relationship between Financial Aspects and Successful CRM Implementation Wijewansa (2011) found out that cost and the financial capability were the first factors to be found as the influencing factors of CRM implementation in Sri Lanka. A sophisticated CRM system would require substantial financial investment. So as per Wijewansa (2011), it could be said as one of the factors to influence CRM implementation of CRM. Return on investment (ROI) is another financial aspect which has to be considered when considered a huge investment. This might provide a justification of the viability of CRM system implementation (Wijewansa, 2011). ROI calculations would enable organization to identify the areas of highest return which can be implemented first in order to show benefits at the beginning of the project (Wijewansa, 2011). The ROI should include measurable and observable metrics in order to show clearly the results that can be achieved by CRM (Wijewansa, 2011). A set budget target has to be monitored throughout the project period to control adverse expences (Wijewansa, 2011). According to Rahimi and Berman (2009), budget over run is one of the critical failure factors from the systems dimension. Any deviation from the pre determined price would lead to additional management discussion and decisions, which makes this budget element more rigid compared to scope and time table (Rahimi and Berman, 2009). Hypothesis 6: Financial Aspects for commercial bank positively influences successful CRM implementation.
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CHAPTER 3: RESEARCH METHODOLOGY

3.1 Conceptual Framework
Independent Variables
Dependent Variable
Technological Orientation
Customer Centricity
External Competitive Pressures
Successful CRM Implementation
Top Management Support & Leadership Employee Behaviour
Financial Aspect
Figure 1: Conceptual Framework
Source: Authors Work
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3.2 Hypothesis Development

H01 There is no relationship between the technological orientation and the successful CRM implementation. H1
There is a relationship between the technological orientation and the successful Ha1 CRM implementation.
H02 H2
There is no relationship between the customer centricity and the successful CRM implementation.
H a2
There is a relationship between the customer centricity and the successful CRM implementation.
There is no relationship between the external competitive pressures and the H3 H03 successful CRM implementation.
There is a relationship between the external competitive pressures and the H a3 successful CRM implementation.
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There is no relationship between the top management support and leadership and H04 the successful CRM implementation. There is a relationship between the top management support and leadership and H a4 the successful CRM implementation. There is no relationship between the employee behaviour and the successful CRM implementation. H5 H05 There is a relationship between the employee behaviour and the successful CRM H a5 implementation.
H4
H6
H06
There is no relationship between the financial aspects and the successful CRM implementation.
H a6
There is a relationship between the financial aspects and the successful CRM implementation.
Table 1: List of Hypothesis Source: Authors work
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3.3 Population and Sampling

Figure 2: Sample Selection
Main Local Commercial Banks with CRM Applications - 11
Private Commercial Banks 9 Branches in Colombo - 306 Sample 40 Branch Managers Commercial Bank DFCC Vardhana HNB NDB NTB PAB Sampath Bank Seylan Bank Union Bank
1
Government Commercial Banks 2 Branches in Colombo - 208
65 21 61 23 25 23 47 33 8
Commercial Bank 5 DFCC Vardhana HNB NDB NTB PAB Sampath Bank Seylan Bank Union Bank 2 5 2 2 2 4 3 2
Peoples Bank 7 Bank of Ceylon 6
Peoples Bank Bank of Ceylon
119 89
Source: Authors Work1
HNB Hatton National Bank, NDB National Development Bank, NTB Nations Trust Bank, PAB Pan Asia Banking Corporation.
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There are 24 commercial banks registered under Central Bank of Sri Lanka (CBSL, 2012). Out of them 14 banks are locally established banks and 10 banks are foreign commercial banks (CBSL, 2012). As the research is only based on local commercial banks 10 foreign banks were ignored. Out of 14 local banks, 3 banks did not focus on CRM applications as their corporate website did not indicate any such technology usage. The population is therefore the 11 local main banks. They are Commercial Bank, DFCC Vardhana Bank, Hatton National Bank (HNB), Nations Development Bank (NDB), Nations Trust Bank (NTB), Pan Asia Bank (PAB), Sampath Bank, Seylan Bank, Union Bank, Peoples Bank and Bank of Ceylon. The CRM usage was figured out by browsing the corporate website (for internet banking function and indications of ATM locations) of the banks. This is the sampling frame work. Due to time constraints the research would only be conducted in Colombo. The number of branches was gathered from CBSL report (2011). So, through stratified random sampling technique branches in Colombo district was listed. Then to arrive at a sample size of 40, branches of each bank was chosen based on a ratio basis. The formula used for sampling is as follows:
No of Branches chosen for a bank = No of Colombo district branches of X bank X 40 Total no of branches in Colombo (514)
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3.4 Proposed Statistical Methods

Authors Name Rapp, A. Trainor, J.K. Agnihotri, R. Title Performance implications of customer linking Moreno, A.G. Melendez, A.P. Analyzing the impact of Ko, E. Kim, S.H. Kim, M. Woo, J.Y. Organizational characteristics and the CRM adoption Statistical Methods Partial Least Squares Linear effects model Cronbach's Alpha Composite Reliability Average Variance Extract Two-step score construction Harman's one-factor Test Chi square Extrapolation method MannWhitney U-test Correlation matrix Cronbachs Alpha Principal components exploratory factor analysis Confirmatory factor analysis structural equation methodology Chi-square statistic Mean Standard Deviation Correlation Coefficient Discriminant analysis Bi- Variate regression analysis Ordinary regression Multiple regression analysis least squares
capabilities: Examining the complementary customer role of and
orientation
CRM technology
knowledge management on CRM success: The mediating effects factors of organizational
process
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Hung, S.H. Hung W.H. Tsai, C.A. Jiang S.C.
Critical factors of hospital adoption on CRM system: Organizational information perspectives and system
Cronbach's alpha Discriminant analysis Multicollinearity Equality of covariance matrices Pearson correlation matrix t-test Correlation Multiple Regression Confirmatory Factor Analysis
Peelen,E. Montfort K.V. Beltman R. Klerkx A. Wijewansa S M
An empirical study into the foundations of CRM success
Customer
Relationship Quantitative Research based on case
Management Systems in the studies Sri Lankan hospitality
industry for sustained growth and development.

Table 2: Proposed Statistical Models
Source: Compiled by Author
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4. DATA ANALYSIS
4.1 Data Collection Methodologies
4.1.1 Primary Data
The primary data required to add value to the aforementioned objectives of the report are gathered from 40 bank mangers of local commercial banks that uses CRM technologies such as ATMs, M-banking solution, online banking, and phone banking solutions etc. Questionnaires were used as the main tool used to gather information. Questions for the survey on 7 major variables were carefully written without any technical jargon and ambiguity. A pilot study among 6 branch managers was done to ensure the quality of the questions and necessary amendments were made at the end. Few interviews were also conducted by the author with general managers for background knowledge and to propose possible recommendations at the end of the study. 52 questionnaires were distributed among Western Province commercial banks for the primary data analysis. Out of 52, 40 fully completed questionnaires were obtained back from relevant branch managers in order to satisfy the sample size stated in Chapter 3. The following image would represent the response rate for the primary data collection.
Figure 4: Response Level for Distribution of Questionnaires Source: Compiled by Author
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Data gathered through questionnaires were fed into SPSS software for analysis. Based on the data received a reliability test was conducted to ensure the reliability of responses to conclude the objectives of the report. Cronbach's Alpha was calculated to exhibit reliability of Likhert scale questions raised on variables. The results are shown below.
Table 3: Reliability of the statistics
Source: SPSS (2012)
As the reliability score is 0.768 it is evident that the Likhert scale questions are highly reliable.
4.1.2 Secondary Data

Secondary research data was gathered from various reliable sources such as annual reports of central bank, LCB websites, journal articles and newspaper publications.
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4.2 Data Analysis

4.2.1 Objective 1: To identify the extent of computerized operations in local commercial banking sector.
Secondary Data Analysis
The initial objective of the study is to look into the level of technological adoptions/computerization used in the operations of the local commercial banks. Before getting to the technological aspects of operations a brief outlook on the importance and growth pattern of the commercial banking sector is essential as it has raised the importance for this report. 4.2.1.1 Highlights of Commercial Banking Sector Sri Lanka As per Tennakoon (2011), The banking sector, which is the most dominant and systematically important sector in the financial system of Sri Lanka, has shown a significant expansion during the last two decades, reflecting the increase in financial transactions to facilitate the growing economy. At the end of year 2011, total number of licensed commercial banks was 24 out of which there are 14 domestic banks (Economic Review, 2011). Total number of commercial bank branches stood at 1432 out of which there are 1386 domestic bank branches (Economic Review, 2011). Out of total extension offices of 898, 728 are local commercial banks (Economic Review, 2011).
Source: Economic Review (2011)
Figure 5: Banking Density of All the Banks by District - 2011
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As per the graph above it is evident that the banking sector density in Colombo district is really high with 25 banks per 100,000 individuals which increases the banking density of Western Province which proves the highest customer bases in the Western Province comparing to other Provinces.
Year
BOC People's Bank Commercial Bank HNB Sampath Bank Seylan Bank Other Banks
2001 346 344 100 124 47 90 33 2002 354 389 109 138 55 96 53 2003 361 396 116 139 64 106 67 2004 370 408 125 143 72 110 85 2005 390 602 140 150 84 114 105 2006 399 632 157 153 97 116 121 2007 408 640 169 169 106 116 150 2008 455 653 177 177 115 114 166 2009 496 679 179 182 137 114 213 2010 520 679 190 192 149 114 283
Table 4: Growth of LCB Branches in Sri Lanka
Source: CBSL (2011) 800 700 600 500 400 300 200 100 0 2001 BOC Sampath Bank 2002 2003 2004 2005 2006 2007 2008 2009 HNB 2010 People's Bank Seylan Bank Commercial Bank Other
Figure 6: Growth of LCB Branches in Sri Lanka
Source: CBSL (2011)
Table 3 and Figure 6 explains that the branch banking network has shown tremendous improvements last 10 years times where the state banks such as Peoples bank and BOC has been growing with their network at a much faster phase than other local commercial banks. The banking density index of domestic commercial banks is explained below.
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Figure 7: Expansion of Commercial Banks and No of Commercial Bank Branch Density per 100000 for SL
Sri Lanka now has more than 11.3 commercial bank branches per 100,000 individuals which are higher than the global median of 8.4 branches per 100,000 individuals which proves the prominence of commercial banks in Sri Lanka (CBSL, 2011 cited in Tennakon, 2011). The sample selected for the report represents the domestic commercial banks which are successfully operating with the launch of CRM technologies which has become an emerging trend in Sri Lanka. The growth of these 11 private and public sector banks in Colombo District are represented below in the graph. Domestic LCB Branches in Colombo Year 2008 2009 2010 2011 Number of Branches 394 405 419 424
Table 5: Growth of Domestic LCB branches in Colombo Source: CBSL (2011)
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430 425 420 415 410 405 400 395 390 385 380 375
424 419
405 Branches 394
2008
2009
2010
2011
Figure 8: Growth of Domestic LCB's in Colombo District
Source: CBSL (2011)
Figure 9: Total Number of Domestic LCB branches in Colombo in 2011 (Population of the Study)
Source: Compiled by Author based on CBSL (2011)
The above figures display the banking density of Colombo District which is the area of study of the report. The total banking population in Colombo is 2,553,000 individuals and the total numbers of domestic LCB branches available are 424 which represents that each branch would serve 6021 people (Authors work, 2012) on average for commercial banking needs. The banking density of domestic commercial banks is 17 branches per 100,000 people (424/ [2553, 000/100,000]) which represents the high potential for alternative banking solutions (CRM technologies) as the banking density is low.
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The above analysis on the branch wise growth over the last decade indicates that Sri Lanka is majorly based on branch banking. But the potential for alternative solutions seem to exist in the Colombo District where the density of the commercial banks is low. Overall the commercial banking sector of Sri Lanka experienced a continuous growth maintaining its stability and profitability with the services offered amidst the challenges from local and global macro-economic conditions (Tennakon, 2012). 4.2.1.2 The Expansion of Technological/Communication Infrastructure in Sri Lanka Having analyzed the banking density in Sri Lanka it is also essential to look into the infrastructure availability which would help to enhance the technological banking. Compared to most of the developing countries around the world Sri Lanka has experienced a phenomenal growth in telecommunications services and usage during the last decade (Colombage, 2011). The following table exhibits the development of technical infrastructure in Sri Lanka.
2001 2002 2003 2004 2005 2006 2007 2008 2009
Fixed Access Services Subscriber Base (000) Fixed Access Services (000) Wireless Access Services (000) Telephone per 1000 people Other Services Mobile Phone (000) Mobile Phones per 100 people Public pay phone booths E-mail and internet users
829 708 121 4.4
883 769 114 4.7
934 818 116 4.9
991 860 131 5.1
1244 919 325 6.3
1884 910 974 9.5
2742 932 1810 13.7
3446 934 2513 17.1
3431 871 2560 16.8
668 5 7281 61532
932 7 6681 70082
1393 12 6440 85500
2211 15 6095 93300
3362 17 6285 115000
5412 27 7561 130000
7983 40 8526 202348
11083 55 7417 234000
13950 68 7936 240000
Table 6: Telecommunication Services Trend in Sri Lanka 2001 - 2009
Source: Adopted from Colombage (2011)
It is evident from the data above that mobile phones have shown a phenomenal growth amidst all other telecommunication services available in the country. This is mainly due to the entry of globally competitive telecommunication service providers. 68 out of 100 people own a mobile phone which gives an indication that the country has a huge potential for the developments of mobile phone banking services further. Since 2000 mobile phone penetration has increased by 32 times in 2009 and reached 14 Million.
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Overall 13% of the households have desktop computers where 6% of have laptops as well (Colombage, 2011). As per Colombage (2011) access to e-mail and internet facilities are largely confined to the low income level households. E-mail and internet subscriber base has improved by 5 times than in 2000s but slower than the mobile phone penetration level. The figure below would exhibit the phenomenal growth patterns of discussed above in the table where the mobile phone usage shows an exceptional steep in growth in comparison to other telecommunication indicators.
Telecommunication Trends in Sri Lanka (2001 - 2009)

15000.00 10000.00 5000.00 0.00 2001 2002 2003 2004 2005 2006 2007 2008 2009 Subscriber Base (000) Wireless Access Services (000) Fixed Access Services (000) Mobile Phone (000)
Figure 10: Telecommunication Trends in Sri Lanka (2001-2009)
4.2.1.3 Operations of Local Commercial Banks with Information and Communication Technology (E-Banking) ICT plays a vital role in the modern economy of Sri Lanka which has significantly had an impact on banking transactions. E-Banking solutions enhances the banking operations through electronic medium which were heavily backed by the technology and internet where the costs are minimal and these facilities are no longer limited by time or geographical boundaries (Maldeni and Jayasena, 2009).
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Figure 11: Evolution of E-CRM Solutions of Sri Lanka
Source: Source: FCCISL (2012)
Table 7: Features of Different Forms of E-Banking
Source: Adopted from Bankable Frontiers Associates (2008)
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1. Automated Teller Machines In 1986, Sampath Bank introduced ATMs to Sri Lankan banking arena (Wijerathna, 2011) where now all the 11 local LCBs have successfully installed it for the purpose of withdrawals, fund transfers etc without going to a bank branch.
Table 8: Trend of ATMs in SL
Source: CBSL (2005 2011)
Figure 12: Trend of Value per Transaction - ATM
Source: Done by Author
Figure 13: LCB ATMs per 100,000 people
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ATMs show an upward slope over time where the value per transaction and ATM locations per 100,000 people has shown improvements. But that growth is not a continuous upward slope where there was a downfall in 2009-2010 periods indicating that the introduction of debit cards has impacted this where before the introduction of separate debit cards ATM cards were used as debit cards as well. 2. Credit Card Transactions
Table 9: Credit Card Transaction Trends
Source: Compiled by Author based on CBSL (2005-2011)
Table 10: Trend of Value per Transaction - Credit Cards
Source: Done by Author (2012)
Figure 14: Credit Card Operations per 100,000 people
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The average transaction value is showing increase but the cumulative credit card transaction has shown tremendous drop after 2008. The possible reasons could be as follows: Banks restricted credit card issues due to global recession during 2008 - 2009. People lost confidence in the credit card usage aftermath of the Golden key fraud on credit cards. People opted for debit cards instead of going for credit cards. Minimum savings level in banks for credit card have been reached and the maximum level of credit cards are been already issued in SL.
3. Debit Card Transactions
Table 11: Debit Card Transactions of LCBs in SL
Source: Done by Author based on CBSL (2008-2011)
Figure 15: Trends of Debit Cards Issued and Transactions
Source: Done by Author (2012)
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Debit cards are recent development in Sri Lanka where it has been launched as a substitute to teller machine cards to be used in transactions with a third party where the payments will be settled through the bank savings. The cards issued show a upward sloping trend and could be said that this is heavily welcomed in SL because within 4 years since launch it has reached a tremendous growth. 4. Electronic Funds Transfer Point of Sales transactions (EFTPOS) EFTPOS were introduced to SL in 1994 (Wijerathne, 2012). As per Wijerathna (2011), payment card holders were able to use their cards at EFPOS machines installed at merchant outlets which enables the merchant to obtain authorization electronically doing away with the manual authorization process in the past.
Table 12: EFPOS Trends of LCBs in SL
Source: Compiled by Author based on CBSL (2004-2011)
Figure 16: Trend of value per transaction via EFTPOS
Source: Compiled by Author based on CBSL (2004 2011)
EFTPOS transaction shows a growth over the period of 2004 2011 which indicates the customers increased usage of electronic payments mediums than using cash.
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5. Online Banking Transactions
Table 13: Online Banking Trends in SL
Source: Compiled by Author based on CBSL (2008 2011)
Figure 17: Trend in transaction via online banking sites of LCBs
Even though the value per transaction is showing fluctuations overall the number of transactions through virtual banking have shows commendable increase over the last four year period. The cumulative value of transactions has also shown improvements but the growth is slowing down in the later period. 6. Mobile/Tele Banking
Table 14: Mobile/Tele Banking Trends of LCBs in SL
Source: Done by Author based on CBSL (2008 2011)
The above table indicates that the mobile banking has been showing decreasing trends even though the total value of transactions show an increasing trend which resulted in increase of value per transactions. This is not a good sign because there is a high potential but commercial banks havent utilized this viable opportunity to gain benefits.
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Figure 18: Trend in Mobile/Tele banking Transactions
Source: Done by Author
If all the non cash transactions of LCBs of SL is taken into account as 100% the composition of all the electronic banking and branch banking will be as follows.
Table 15: Composition of Electronic Payments
Figure 19: Composition of Non Cash Transactions
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The electronic stance in transactions would reduce the cost per transaction of banks than branch banking operational costs as explained by the diagram below:
Figure 20: Transaction cost for bank Vs E-CRM Solutions
Source: Kumara (2012)
As explained by Kumara (2012), the adaptation of technology has not been fast as predicted and the cost of a transaction has not come down to $0.01 as predicted .Internet banking is still not a reality and people are still to be convinced with regard to security and privacy. He further elaborates the fact that communication systems makes the physical banking solutions irrelevant but the touch of human is very essential in any service sector and especially for banking sector (Kumar, 2012).
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4.2.2 Objective 2: To identify the existing CRM implementation barriers in local commercial banks.
Secondary Data
While technological solution brings in enormous benefits to operations of commercial banks, there are certain issues prevailing in CRM stance which holds back banks from totally depending on technology or restricted certain emerging banks opting for alternative banking solutions. Following are the major barriers and risks prevailing in that respect: 1. Lack of Customer Awareness and Willingness to go for E-Banking solutions
Table 16 - Awareness and Use of Electronic Banking Solutions
Source: Adapted from Colombage (2011)
Approximately 70% of people have knowledge about ATMs and 37% of people have knowledge about internet banking. 22% people know about E-Remittance services which are mostly contributed by the ultra poor community where most of them are migrant workers (Colombage, 2011). Non poor segment does not have that extent of knowledge in this manner. It is very evident that there are limitations in awareness and willingness towards these E-banking solutions. The household survey on E-Money illustrated that 8% think it is costly, 2.3% think it is less secured, 9.4% faces difficulties in using them and 80.4% think it is not necessary and never heard of any instead of ATMs (Colombage, 2011). Suraweera et al (2012) indicate that most of the banking customer has closest proximity to banks and they prefer to go for branches
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than logging in to the virtual banking site. This is a major barrier and commercial banks should carry out great deal of awareness campaigns to persuade customers to go for e-banking solutions. 2. Requirement of Proper Internal Controls for E-CRM Solutions
Figure 21: Risks involved in Internet Banking
Source: World Bank (2012)
The above diagram displays issues faced by banks when operating with CRM solutions through internet. Breaches into internet sites and theft of information from those sites requires more attention from the banks to have superior internal control present which comes with a huge cost (World Bank, 2012). If the control were not present along with CRM the bank would have to face tremendous reputational issues and would lose the promise of integrity towards their customers which would hammer the confidence on e-banking solutions. If viruses were penetrated which could even bring in liquidity and legal liabilities as the bank site act as a Slave to the hacker which is also due to weak internal controls (World Bank, 2012). As internal control required for proper operations via internet or any other medium it is essential to invest in human resources and software to avoid reputational risk which is extremely costly and an added responsibility for the management.
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3. Compliance requirements to Legislations/Authorities on ICT Transactions There are various laws that govern the transactions over internet and mobile mediums. They are:
Table 17: Legislations governing E-Banking Transactions
Source: Ratnayaka (2012)
The local commercial banks have to accompany the e-banking solutions along with the consideration to the above legislations. Otherwise breaching of any of the above would lead to compliance risk and could hinder the reputation of the bank. Along with that banks have to consider the guidelines of the Central bank of SL on electronic transactions and banking services. For example CBSL has issued a set of guidelines for mobile payments to avoid security concerns of the public (Sunday Times, 2012). There are disclosure requirements in their respective annual reports (World Bank, 2012). So CRM requires compliance requirement and additional requirement in annual reports which creates additional work and responsibility. 4. Issues in managing operational risks While operating with wide range of technological elements in CRM there would be emerging range of operational risks that has to be addressed by the commercial banks. Such risks impose too much of barriers in the implementation process or after the implementation. Bankable frontier associates (2012) illustrated these risks as in the table.
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Table 18: Operational Risks of E-Banking Solutions
Source: Adopted from Bankable Frontier (2008)
Each and every local commercial bank has to report its risk elements in their annuals reports where they give the value each of the operational risks stated above. This is an additional responsibility and commercial banks have to continuously monitor these elements to avoid negative consequences soon after the systems implementation. 5. Race for adopting new technologies The salient feature of ICT is it would become obsolete within very few months since its inception. Bankers continuously needs to deploy sophisticated yet user friendly systems to meet customers acceptance but this is not that easy (Wijewardane, 2011). Bankers who implemented
2
Highlighted factors are important in technological systems
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sophisticated systems would sooner find that their system has been outdone by their competitor. When profit margins are reducing due to competitions it would be that easy to small scale banks to invest another lot of money into a system (Wijewardane, 2011). This would raise a question on the banks survival in the fight for supremacy. This has become a serious issue to current banking sector firms (Wijewardane, 2011). 6. Limitations in Resources Smaller commercial banks faces issues with limited resources such as human resources finance and infrastructure required to run the proper CRM systems. This would create barriers in the operations. Banks should be accompanied with proper up-to date storage solutions if not that could lead to loss of information assets of the banks (Intel, 2012). Competent employees are required to be recruited and trained for the job with systems and it is a CBSL requirement too. They are supposed to be given proper machines to work with to increase the satisfaction and also to improve the ROI (Intel, 2012). All the above requires sufficient financial backup which is another barrier for CRM implementations. Primary Data
An open ended question was raised in order to get the viewpoint of bank managers regarding the barriers of CRM implementation in their respective branches. The qualitative analysis below in table 19 gives an important indication that most of the responses are more oriented towards demographics of their customer bases. Security is the mostly mentioned barrier and next highest is for the customers perception to deal with staff in money dealings. E-CRM acceptance is high among youngsters but very limited/low among senior citizens. System failures and downtimes also pose issues for implementation of such systems. In highly business areas such as Pettah, business men who still follow manual recording of accounts definitely require staff assistance when banking their incomes and banks prepare records the details for them. In such conditions E-CRM is of very limited usage. Same limitation applies for banks with higher fixed accounts customers where routine transactions are very limited and erodes the usage of such CRM solutions.
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Table 19: Barriers in E-CRM Implementation in LCBs of Sri Lanka - Primary Data
Source: Compiled by Author based on Primary Survey (2012)
To avoid the lack of knowledge of the customers the awareness building should be enhanced. Down times and changes in technology could be resolved by proper internal controls and business intelligence where these poses further limitations for small scale emerging commercial banks.
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4.2.3 Objective 3: To identify factors affecting to the successful CRM implementation to the
local commercial banks. 7 variables were taken into consideration to analyze the factors influencing towards successful CRM implementation as per the conceptual framework. 5 pointer Likhert scale questions gave the average results as following:
Table 20: Mean and Standard Deviation Statistics of Variables
Source: Done by Author based on SPSS (2012)
The detailed analysis on each factor is given below. 1. Technology Orientation
Table 21: Frequency Table for Technology Orientation
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Figure 22: Histogram for Technology Orientation
Table shows that the 92.5% of the sample accepts the fact that their bank is technologically oriented. This may be due to well established integrated databases which could be accessed through all contact points to provide customized services. Whereas 5% of them are neutral and 2.5% shows disagreement with the technological orientation of their banks. This could be due to low database integration, poor technical knowledge of staff and the low level of awareness created on the CRM solutions. Mean, median and mode values of 4.28, 4.4 and 4.4 respectively indicates that on average the sample Agree their commitment to technology in operations. The overall negative skewness of -2.281 explains that sample displays more agreement on the technology oriented attributes of their bank. SD of 0.461 shows the moderate variation of the results deviating from mean which explains the moderately flat bell curve distribution. It could be concluded that local commercial banks are more technology oriented in their operations which is one of positive factors that could impact CRM solution implementations.
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2. Customer Centricity
Table 22: Frequency Distribution Table for Customer Centricity
Figure 23: Histogram for Customer Centricity
Table shows that the 77.5% of the sample accepts the fact that their bank is highly customer centric. This may be due to better understanding towards customer needs, customer driven strategies, personalized service offerings and rewarded loyalty. However 22.5% of them are neutral on the opinion. This could be due to limited customer oriented culture prevailing in the banking operations. Mean, median and mode values of 4.26, 4.2 and 4.2 respectively indicates that on average the sample Agree their commitment to customers in operations. The overall marginal positive skewness of 0.042 explains that sample displays just agreement
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on the customer centric attributes of their bank. SD of 0.404 shows the moderate variation of the results deviating from mean which explains the flat bell curve distribution. It could be concluded that local commercial banks are between neutral agreement range in customer centric in their operations which is one of positive factors that could impact CRM solution implementations. 3. External Competitive Pressures
Table 23 : Frequency table for External Competitive Pressures
Figure 24 : Histogram of External Competitive Pressures
Table shows that the 82.5% of the sample accepts the fact that their bank is highly responsive to external competitive pressures. This may be due to high response rate to changing customer preferences on products and they respond to technological enhancements. These
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sample respondents are on the opinion that they deal with business intelligence units to detect changes in rivals moves regarding the way of serving customers. However 15% of them are neutral on the opinion and 2.5% disagree. This could be due to limited business intelligence in responding to external competitive environment. Mean, median and mode values of 4.18, 4.2 and 4.4 respectively indicates that on average the sample Agree their commitment to customers in operations. The overall negative skewness of -0.950 explains that sample displays greater agreement on the flexibility to external environment changes of their bank. SD of 0.385 shows the moderate variation of the results deviating from mean which explains the steep bell curve distribution. It could be concluded that local commercial banks are between an agreements in being flexible to competitive pressures in their operations which is one of positive factors that could impact CRM solution implementations. 4. Top Management Commitment and Leadership
Table 24: Frequency table for Top Management Commitment and Leadership
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Figure 25: Histogram for Top Management Commitment and Leadership
Table shows that the 70% of the sample accepts the fact that their bank has top managements commitment and leadership in CRM. This may be due to declared commitment in vision, innovative ability of the management, high involvement in any customer related initiatives etc. Whereas 27.5% of them are neutral and 2.5% shows disagreement with management commitment. This could be due to poor leadership of the management, lack of customer friendly bank environment created etc. Mean, median and mode values of 4.09, 4.2 and 4.2 respectively indicates that on average the sample Agree their commitment of management. The overall negative skewness of -0.816 explains that sample displays more agreement on this variable. SD of 0.468 shows the moderate variation of the results deviating from mean which explains the moderately flat bell curve distribution. It could be concluded that local commercial banks has reasonable management commitment and leadership in their operations which is one of positive factors that could impact CRM solution implementations.
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5. Employee Behaviour
Table 25: Frequency Table for Employee Behaviour
Source: Compiled by Author based on SPSS (2012)
Figure 26: Histogram for Employee Behaviour
Table shows that the 60% of the sample accepts the fact that their positive employee attributes in CRM. Having employees with technical expertise, customer satisfaction related pay schemes, and environment for knowledge sharing has been major factors contributed for the agreement. However 40% of them are neutral towards their opinions maybe due to lack of training, lack of expertise in technical aspects, very few motivational schemes etc. Mean, median and mode values of 4, 4 and 4.2 respectively indicates that on average the sample Agree their view on attributes of employee behaviour. The overall negative skewness of 0.238 explains that sample displays agreement on this variable. SD of 0.465 shows the
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moderate variation of the results deviating from mean which explains the moderately flat bell curve distribution. It could be concluded that local commercial banks has reasonable positive employee behaviour on their operations but could be improved as it is a vital factor that could impact CRM solution implementations. 6. Financial Aspects
Table 26: Frequency Table for Financial Aspects
Figure 27: Histogram for Financial Aspects
Table shows that the 62.5% of the sample accepts the fact that their bank is financial attributes when it comes to technology. This is mainly because of their major consideration on initial finance for a system, their reliance on ROI, and their cost per customer contacts has
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reduced with alternative banking solutions. However 37.5% of respondents are neutral on the opinion because their financial capability is not sound enough and budgetary control are very limited and also their market position has shown very limited improvement after CRM systems. Mean, median and mode values of 4.04, 4.2 and 4.2 respectively indicates that on average the sample Agree their concern on attributes of financial viability of technological solutions. The overall negative skewness of -0.745 explains that sample displays moderate agreement on the financial aspects. SD of 0.367 shows the moderate variation of the results deviating from mean which explains the steep bell curve distribution. It could be concluded that local commercial banks are in agreements in there consideration towards financial aspects in their operations which is one of factors that could impact CRM solution implementations. 7. Successful CRM Implementation
Table 27: Frequency table for Successful CRM Implementation
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Figure 28: Histogram for Successful CRM Implementation
Source: Compiled by Author based on SPSS (2012)
Table shows that the 62.5% of the sample accepts the fact that their bank has successfully implemented CRM solutions. This is mainly because of increase in perceived customer satisfaction, trust and loyalty along with reduction in customer complaints on services. However 32.5% of respondents are neutral on the opinion and 5% disagree with this variable because customer trust related issues were prevailing and customers mostly prefer branch banking and there are complaints on systems malfunctions which has bough expected benefits to the banks. Mean, median and mode values of 3.95, 4 and 4.2 respectively indicates that on average the sample Agree their concern on attributes of successful CRM installation in branches. The overall negative skewness of -0.708 explains that sample displays moderate agreement on the financial aspects. SD of 0.455 shows the variation of the results deviating from mean which explains the relatively flat bell curve distribution. It could be concluded that local commercial banks are in agreements to a moderate extent where their CRM implementation has shown successful results in banking operations and performance. It could be said that for this the aforementioned independent variables collectively contributed in a way.
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4.2.4 Objective 4: To find out the relationship between factors affecting to the successful CRM implementation to the local commercial banks.
The 6 independent variables are compared against dependent variable successful CRM implementation using Pearsons correlation analysis to identify the relationships to satisfy the objective above. 1. Technological orientation and Successful CRM Implementation
Table 28: Correlation of Technological Orientation and CRM Implementation
The correlation indicates a weak positive relationship and it is not significant in 2 tail analysis. 2. Customer centricity and Successful CRM Implementation
Table 29: Correlation of Customer Centricity and CRM Implementation
The correlation indicates a weak positive relationship and it is not significant in 2 tail analysis.
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3. External Competitive Pressures and Successful CRM Implementation
Table 30: Correlation between External Competitive Pressures and CRM Implementation
There is a positive and strong relationship between these two variables and it is significant even at 0.01 level in 2 tail test. 4. Top Management Commitment and Leadership and Successful CRM Implementation
Table 31: Correlation between Top Management Commitment and CRM Implementation
The correlation indicates a weak positive relationship and it is not significant in 2 tail analysis.
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5. Employee Behaviour and Successful CRM Implementation
Table 32: Correlation between Employee Behaviour and CRM Implementation
There is a strong positive relationship between these two variables and the relationship is significant even at 0.01 level in 2 tail test. 6. Financial Aspects and Successful CRM Implementation
Table 33: Correlation between Financial Aspects and CRM Implementation
There is a strong positive relationship between these two variables and the relationship is significant even at 0.01 level in 2 tail test. In conclusion, external competitive pressures pose an emergence for rapid innovation to sustain in the market which leads to a positive relationship. Employees are the people who would deal with the systems and it is necessary to train and motivate them. This has been represented by the strong positive relationship. Financial aspects are the major force which drives the capability of the firm to afford for systems which is also represented by strong and significant relationship.
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4.2.5 Objective 5: To make suitable recommendations to overcome the CRM implementation barriers
The initial barrier identified was the lack of knowledge and willingness of the customers to go for alternative banking solutions. In order to build trust and to motivate the customer base there should be efficient promotions and awareness campaigns. Currently LCBs do advertising, seminars, rewards schemes for online transactions, door to door delivery of new product launches and asking employees to direct customers towards alternative solutions. But in order to be efficient banks could eliminate the transaction fee costs for online and mobile transactions which would be an added advantage than normal branch banking. Schemes like relationship pricing/marketing such as issuing free ATM cards issued for the supersavers and senior citizens to trigger them towards these solutions. LCBs face another problem on minimal internal controls regards the systems. In order to avoid fraud and theft certain individual authentication password to operate by the bank employee and customers from home should be issued with high confidentiality. Like as for the vaults 3 or 4 officials should be present to initiate the core banking solution to avoid fraud by individuals with high autonomy over systems. Employee should be having limited access to any system to avoid manipulations. On a regular basis integrity checks should be done to ensure any abnormal inputs being processed by solutions. If needed forensic checks and controls could be done to avoid mathematical errors. Proper legal issues should be considered and monitored to avoid legal proceedings. For this proper knowledge on the legality of the operations via electronic mediums should be ensured by the lawyer of the banks. Corporate governance should be maintained in the technological solutions too. To avoid operational risks of the technology, each and every components in the network should be examined and risks that could rise should be given priorities in relevant to the impact on continuity of the operations. Relevant points of entry, accessibility and bank networks should be monitored and security setups should be installed. If any external contractors are involved with the systems linkages and operations the terms of service relationships should be continuously checked for any abnormalities to avoid data theft. If the banks are lacking behind in their technological resources and finance possible outsourcing options could be checked and they could establish a contracts for a period of time
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since banks establish their own expertise. Insurance should be made available in that option to avoid external threats from vendors. In house and off the job training should be conducted in addition to CBSL requirement to improve the technical capabilities of the employees to deal with systems. If possible customer related performance appraisal systems should be introduced and enhanced. Efficient business intelligence systems should be improved to detect any strategic moves by the competitors to avoid losses. Currently very few banks analysis through information gathered but only considers these solutions as just customer contact points. In order to improve the banks competitive position in the market gathered information on databases such as the detailed history of transactions, customers relationship with bank (years), suspicious transactions, lifestyles (through credit card transactions), living conditions etc would give valuable indications that could be analyzed to provide cross selling opportunities like a insurance scheme or loan scheme.
The recommendation model for the barriers and influencing factors are given below.
Figure 29: Solution Model for Successful CRM Implementation
Source: Authors Work
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CONCLUSION
The main significance of the study is that it would help the local commercial banks of Sri Lanka to analyze the factors impacting towards the successful CRM implementation in the technological context. The major objectives of this report are to identify the extent computerized operations in banking, to identify the current barriers to CRM implementation in banks, to identify factors affecting towards the implementation of successful CRM, to figure out the relationship between factors and successful CRM implementation, and to provide possible recommendations to overcome issues. The main factors identified for analysis are technological orientation, customer centricity, external competitive pressures, top management support and leadership, employee behaviour and financial aspects. Literature review on the above variables may be subjective as only one research was been able to be found on a Sri Lankan perspective and rest of them were based on a few foreign countries where the commercial banks operating conditions and customer preferences may significantly differ. As CRM from a technological perspective is still in its infancy the research would give more indication as to the positions of the current CRM conditions in a local scenario. In that respect through primary and secondary data was analyzed and possible recommendations were given for the stakeholder groups who would be benefiting from a successful change in the future banking performances.
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APPENDICES
APPENDIX A: Questionnaire PART - A Branch Details: 1. Name of the Bank: 2. Branch Location: 3. Category of the Bank: . .
Government Bank Private Bank
4. Please state the customer base of the branch (Number of account holders): a. Current Account holders: b. Savings Account holders: . c. Fixed Account holders: 5. How many employees are currently working in the branch: 6. Can you roughly state the annual turnover of this branch? .. Respondents (Branch Manager) Details: 7. Gender: 8. Age: 9. Educational Qualifications:
Male
Female
Bachelors Degree Masters Degree Professionally Qualified [Ex: CIMA, CIM, ACCA etc] Professionally Qualified Banker Other
Technology Details: 10. When the bank did start using alternative solution to branch banking [Ex: ATMs, online banking, mobile banking etc]? 11. What type of customer details are gathered from the above solutions?
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PART - B Please choose the most suitable answer with a X sign in the given box. [SA Strongly Agree, A Agree, N Neutral, D Disagree, SD Strongly Disagree] Questions
12 Banks information systems are integrated across the different functional areas [Savings Technology Orientation
SA
SD
division, loan division, pawning division etc] 13 Individualized information about each customer is available at all contact points
14 Bank has right technical staff to provide technical support for use of technology in building
customer relationships
15 Bank is able to consolidate all information acquired about customers in comprehensive up-to-
date database
16 Bank has promoted their alternative banking solutions such as ATMs, online banking, mobile
banking etc promptly for the creation of awareness among their banking customers
17 Banks market excellence is based on understanding customer needs Customer Centricity 18 Banks business strategies are driven by objective of increasing value for customers 19 Bank offers personalized services for key customers 20 Anybody in the organization is convinced of the importance of customers for the organization
(Customer centric organizational culture)

21 Loyal customers are rewarded
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22 Competitive pressures are the main reason for the usage of customer interaction technologies External Competitive Pressures
in the banking operations to out beat the rivals

23 Banking customer's preferences change frequently 24 The technology in our industry is changing rapidly 25 Technological changes provide big opportunities in banking industry in terms of technology
to serve customers better

26 Business intelligence units are there to continuously monitor changes in customer service
technologies adopted by competitors

27 In the bank's vision you declare the commitment to customers 28 Top management is strongly involved in implementation of customer relationship targets to
Top Management Commitment and Leadership Employee Behaviour
retain the customers 29 Senior Executives would sooner create something new to improve the market presence
30 The bank management has provided a very friendly customer focused environment 31 Top management shows leadership when initiating a customer oriented technological program 32 Bank has qualified (expert) employees needed to succeed in customer relationship technology
usage.
33 Training programs are designed to help employees develop skills needed
to manage customer relationships appropriately

34 Employee performance is measured for rewards on basis of detection of customer satisfaction
with service provided
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35 Bank has provided an environment where the employees are freely allowed to share the
knowledge about serving customers

36 Bank's employees are motivated in various ways towards the commitment of customer related
initiatives of the bank

37 Bank's financial capability is the most influential factor when considering new technology
adoption for better contact management

38 Viability of the project is measured through the return per investment for better financial Financial Aspects
evaluation of the investment

39 Budgetary targets for each investment is set for control purposes of adverse budget over run
40 Efficiency of the banking operations in terms of cost per customer contacts has shown
improvements after implementing customer contact technologies over time

41 Bank's market share has improved with effective technological solutions Successful CRM Implementation 42 Customer trust in our technological banking solutions without any human interactions have
improved 43 Perceived customer satisfaction has improved with customer related technological solutions
44 Customer loyalty has shown improvements after the technological initiatives 45 Bank's competitive position has improved with innovative technological solutions 46 Customer complaints on banking services have significantly reduced after alternative
technological solutions to branch banking
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PART - C 48. What are the barriers existing in your branch and area you serve the customers through a technological banking solution? Are those services heavily welcomed by your customer base? 49. In your opinion, what are the major considerations when introducing and implementing a new customer related technological solutions in local commercial banks?
APPENDIX B Interview Questions 1. Can you give an insight to the initial investment of implementing a sophisticated CRM solution? 2. What are the main strategic information that are been gathered via a CRM solution like ATMs, online transactions, mobile banking solutions etc? 3. How are you managing the employee resistance for IT solutions? What type of training facilities do you provide the employees to work with IT solutions? How often do they get trained? 4. Is there any customer oriented performance related pay schemes for the employees?
5. What are the initiatives taken by the top level management to make the customers aware of the solutions and also to persuade them towards using them? 6. In your opinion, do you think that branch banking would still be viable in few years time with emerging technological advancements in the context of banking in Sri Lanka?
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APPENDIX C: Demographics of Primary Survey a. Local LCBs representation in the sample
Figure 30: Sample Representation of LCBs
b. Branch Location representation in the sample
Figure 31: Location Representation in the sample
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c. Type of banks in the sample (Government Banks Vs Private Banks)
Figure 32: Private Vs Government Banks Representation in the sample
d. Respondents Gender
Figure 33: Gender of the respondents
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e. Respondents Age
Figure 34: Age Composition of the Sample
f. Educational Qualifications of the Respondents
Figure 35: Educational Qualifications of the Sample
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g. Customer Base of Respondents
Figure 36: Customer Base of the Samples
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h. Annual Revenue of the sample branches
Figure 37: Annual Revenue of the Sample Branches
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A Study of Factors Affecting Towards the Implementation of Customer Relationship Management Systems in Local Commercial Banks of Sri Lanka

Module Code and Title BLB00096 3 Investigations

Supervised By: Prof. Kennedy Gunawardena

Staffordshire University 25th June 2012, Colombo

CRM Implementation in Local Commercial Banks

Asia Pacific Institute of Information Technology

CRM Implementation in Local Commercial Banks

Asia Pacific Institute of Information Technology

CRM Implementation in Local Commercial Banks

CRM Implementation in Local Commercial Banks

CRM Implementation in Local Commercial Banks

CRM Implementation in Local Commercial Banks

Asia Pacific Institute of Information Technology

CRM Implementation in Local Commercial Banks

CHAPTER 1: INTRODUCTION TO THE STUDY

CRM Implementation in Local Commercial Banks

1.2 Problem Statement

1.3 Problem Justification

1.4 Objectives of the study

Asia Pacific Institute of Information Technology

CRM Implementation in Local Commercial Banks

1.5 Significance of the study

1.6 Scope and Limitations of the study

CRM Implementation in Local Commercial Banks

CHAPTER 2: LITERATURE REVIEW

2.2 Applications of CRM

CRM Implementation in Local Commercial Banks

2.3 Electronic Banking in Sri Lanka: Prospects and Constraints

Asia Pacific Institute of Information Technology

CRM Implementation in Local Commercial Banks

CRM Implementation in Local Commercial Banks

CRM Implementation in Local Commercial Banks

2.5 CRM Implementation

Asia Pacific Institute of Information Technology

CRM Implementation in Local Commercial Banks

2.6 Literature on Hypothesis Variables

CRM Implementation in Local Commercial Banks

Asia Pacific Institute of Information Technology

CRM Implementation in Local Commercial Banks

Asia Pacific Institute of Information Technology

CRM Implementation in Local Commercial Banks

Asia Pacific Institute of Information Technology

CRM Implementation in Local Commercial Banks

Asia Pacific Institute of Information Technology

CRM Implementation in Local Commercial Banks

CRM Implementation in Local Commercial Banks

Asia Pacific Institute of Information Technology

CRM Implementation in Local Commercial Banks

Asia Pacific Institute of Information Technology

CRM Implementation in Local Commercial Banks

Asia Pacific Institute of Information Technology

CRM Implementation in Local Commercial Banks

CHAPTER 3: RESEARCH METHODOLOGY

External Competitive Pressures

Successful CRM Implementation

Top Management Support & Leadership Employee Behaviour

Figure 1: Conceptual Framework

Source: Authors Work

Asia Pacific Institute of Information Technology

CRM Implementation in Local Commercial Banks

3.2 Hypothesis Development

Asia Pacific Institute of Information Technology

CRM Implementation in Local Commercial Banks

Table 1: List of Hypothesis Source: Authors work