Customer relationship management
From Wikipedia, the free encyclopedia Jump to: navigation, search Customer relationship management (CRM) is a broadly recognized, widelyimplemented strategy for managing a company’s interactions with customers, clients and sales prospects. It involves using technology to organize, automate, and synchronize business processes—principally sales activities, but also those for marketing, customer service, and technical support. The overall goals are to find, attract, and win new clients, nurture and retain those the company already has, entice former clients back into the fold, and reduce the costs of marketing and client service. Customer relationship management denotes a company-wide business strategy embracing all client-facing departments and even beyond. When an implementation is effective, people, processes, and technology work together to increase profitability, and reduce operational costs.
Many CRM vendors offer Web-based tools (cloud computing) and software as a service (SaaS), which are accessed via a secure Internet connection and displayed in a Web browser. These applications are sold as subscriptions, with customers not needing to invest in the acquisition and maintenance of IT hardware, and subscription fees are a fraction of the cost of purchasing software outright.
Phases of CRM
The three phases in which CRM help to support the relationship between a business and its customers are, to:
Acquire: a CRM can help a business in acquiring new customers through excellent contact management, direct marketing, selling and fulfillment. Enhance: a web-enabled CRM combined with customer service tools offers customers excellent service from a team of trained and skilled sales and service specialists, which offers customers the convenience of one-stop shopping. Retain: CRM software and databases enable a business to identify and reward its loyal customers and further develop its targeted marketing and relationship marketing initiatives.
Tools and workflows can be complex to implement, especially for large enterprises. Previously these tools were generally limited to contact management: monitoring and recording interactions and communications. Software solutions then expanded to embrace deal tracking, territories, opportunities, and at the sales pipeline itself. Next came the
“. and still are. This allows sales representatives to pursue more clients in a shorter amount of time than would otherwise be possible. from initial contact to final disposition. Many SFA applications also include insights into opportunities. sales forecasts and workflow automation.
Customer Service and Support
Recognizing that service is an important differentiator. a 2009 study revealed that only 39% of corporate executives believe their employees have the right tools and authority to solve client problems. implementations are fragmented. responses. leads. computer telephone integration (CTI). isolated initiatives by individual departments to address their own needs. often cutting out the active sales process altogether. These technologies have been. and escalation capabilities. telephone and direct mail.0 e-commerce and pricing. including email. Often.
.advent of tools for other client-facing business functions. and dysfunctional processes. and revenue. territories. deals. Newly-emerged priorities are modules for Web 2.
CRM systems for marketing help the enterprise identify and target potential clients and generate qualified leads for the sales team. Even so. quote generation. This has been superseded by marketing automation and Prospect Relationship Management (PRM) solutions which track customer behaviour and nurture them from first contact to sale. minimizing the time that sales representatives need to spend on each phase.
Sales force automation
Sales force automation (SFA) involves using software to streamline all phases of the sales process. including such features as intelligent call routing. social media. At the heart of SFA is a Contact management system for tracking and recording every stage in the sales process for each prospective client. organizations are increasingly turning to technology platforms to help them improve their clients’ experience while aiming to increase efficiency and minimize costs. and product knowledge. offered as on-premises software that companies purchase and run on their own IT infrastructure. as described below. The core for these applications has been and still is comprehensive call center solutions. Metrics monitored include clicks. Systems that start disunited usually stay that way: siloed thinking and decision processes frequently lead to separate and incompatible systems. A key marketing capability is tracking and measuring multichannel campaigns. search.
an integrated solution that lets organizations and individuals efficiently track and record interactions. Owing to these factors. For example. and more.
Departments within enterprises — especially large enterprises — tend to function with little collaboration. and the frequency of various issues. small businesses are finding value in online solutions. documents. in their turn.
. jobs. By evaluating “buy signals. and features for measuring the effectiveness of online.” marketers can see which prospects are most likely to transact and also identify those who are bogged down in a sales process and need assistance. and search marketing campaign. Sales analytics let companies monitor and understand client actions and preferences.
Basic client service can be accomplished by a contact manager system. want to be able to pursue these opportunities without the burden of re-entering records and contact data into a separate SFA system. These tools usually focus on accounts rather than individual contacts.Relevant analytics capabilities are often interwoven into applications for sales. offline. in order to correct problems before they affect satisfaction levels. Support-focused applications typically include dashboards similar to those for sales. purpose-built applications for analytics and business intelligence. scheduling. These types of analytics are increasing in popularity as companies demand greater visibility into the performance of call centers and other service and support channels. marketing. These features can be complemented and augmented with links to separate. plus capabilities to measure and analyze response times. They also generally include opportunity insight for tracking sales pipelines plus added functionality for marketing and service. Reps. and dashboards that graphically display Marketing applications generally come with predictive analytics to improve segmentation and targeting. many of the top-rated and most popular products come as integrated suites. the development and adoption of these tools and services have fostered greater fluidity and cooperation among sales. service quality. More recently. This finds expression in the concept of collaborative systems which uses technology to build bridges between departments. including emails. service. Marketing and finance personnel also use analytics to assess the value of multi-faceted programs as a whole. Web analytics have evolved significantly from their starting point of merely tracking mouse clicks on Web sites. feedback from a technical support center can enlighten marketers about specific services and product features clients are asking for. and service. through sales forecasting. and marketing. As with larger enterprises. agent performance. especially for mobile and telecommuting workers. faxes. data quality.
demographics. membership directories. Capabilities typically include tracking the following: fund-raising. LinkedIn and Facebook are amplifying the voice of people in the marketplace and are having profound and far-reaching effects on the ways in which people buy. It is often found that people feel that interaction is peer to peer between them and their contacts and resent the company involvement. there may be some overlap between social/community driven tools and non-profit/membership tools. Details on companies are now also shared online.
For larger-scale enterprises. such as using online communities as a source of high-quality leads and a vehicle for crowd sourcing solutions to client-support problems. Increasingly. These observers recommend careful market research to determine if and where the phenomenon can provide measurable benefits for client interactions. Some analysts take the view that business-to-business marketers should proceed cautiously when weaving social media into their business processes. Benefits must be defined. Companies can also leverage client stated habits and preferences to personalize and even “hyper-target” their sales and marketing communications. responding with negatives about that company. and cost quantified in three general areas:
Processes: Though these systems have many technological components. Many include tools for identifying potential donors based on previous donations and participation. membership levels. and company-wide support that can make the initiative of choosing and implementing a system successful. products and services.Social media sites like Twitter. Customers can now research companies online and then ask for recommendations through social media channels. individuals can say anything they want about a company or brand. companies are looking to gain access to these conversations and take part in the dialogue. a complete and detailed plan is required to obtain the funding. risks assessed. Social media promoters cite a number of business advantages. volunteering and communications with individuals. In light of the growth of social networking tools.
Non-profit and Membership-based
Systems for non-profit and membership-based organizations help track constituents and their involvement in the organization. resources. sales and support. It can be seen as a more client-centric way of doing
. As social media is not as widely moderated or censored as mainstream media. People are using social media to share opinions and experiences on companies. business processes lie at its core. whether pro or con. making their buying decision without contacting the company.. More than a few systems are now integrating to social networking sites.
enabled by technology that consolidates and intelligently distributes pertinent information about clients. and how best to employ them. integrations are piecemeal initiatives that address a glaring need: improving a particular client-facing process or two or automating a favored sales or client support channel. and market trends. a company must analyze its business workflows and processes before choosing a technology platform. Collaboration. responsiveness. In other instances. sales. key factors include alignment with the company’s business process strategy and goals. Therefore. and support for the workforce. planners need to determine the types of client information that are most relevant. and two-way communication should be encouraged across hierarchical boundaries. and significant savings in operating costs are some of the benefits to an enterprise. They offer a less than complete client view and often lead to unsatisfactory user experiences.
. especially with respect to process improvement. higher rates of client satisfaction. enterprises simply automate flawed clientfacing processes rather than redesign them according to best practices. Technology: In evaluating technology. Poor integration: For many companies. Such “point solutions” offer little or no integration or alignment with a company’s overall strategy. some will likely need re-engineering to better serve the overall goal of winning and satisfying clients. teamwork.
People: For an initiative to be effective. Moreover. Proponents emphasize that technology should be implemented only in the context of careful strategic and operational planning.business. Depending upon the size of the company and the breadth of data. Platform selection is best undertaken by a carefully chosen group of executives who understand the business processes to be automated as well as the software issues. without an accompanying rationale. an organization must convince its staff that the new technology and workflows will benefit employees as well as clients.
Increases in revenue. context. including the ability to deliver the right data to the right employees and sufficient ease of adoption and use. Senior executives need to be strong and visible advocates who can clearly state and support the case for change. marketing effectiveness. choosing an application can take anywhere from a few weeks to a year or more. Implementations almost invariably fall short when one or more facets of this prescription are ignored:
Poor planning: Initiatives can easily fail when efforts are limited to choosing and deploying software.
Provide training: Changing the way people work is no small task. many staffers still need assistance with learning and adoption Lead by example: Showing employees that upper management fully supports the use of a new application by using the application themselves may increase the likelihood that employees will adopt the application. With expenditures expected to exceed $11 billion in 2010. and service.•
Toward a solution: overcoming siloed thinking. less than 40 percent of 1. Choose the right capabilities: Employees need to know that time invested in learning and usage will yield personal advantages.275 participating companies had end-user adoption rates above 90 percent. In this view. the landscape is littered with instances of low adoption rates. and help is usually a requirement. a Gartner report estimated that more than $1 billion had been spent on software that was not being used. Marketing staff should be able to leverage client information from sales and service to better target campaigns and offers. four-fifths of senior executives reported that their biggest challenge is getting their staff to use the systems they had installed. 43 percent of respondents said they use less than half the functionality of their existing system. In 2003. and simplicity should be as important a decision factor as functionality.
Historically. Experts advise organizations to recognize the immense value of integrating their client-facing operations. According to CSO Insights. and 67 percent said that finding time to evaluate systems was a major problem.
Privacy and data security system
. enterprises need to address and overcome persistent adoption challenges. sales representatives need to know about current issues and relevant marketing promotions before attempting to cross-sell to a specific client. 51 percent cited data synchronization as a major issue.. Further. internally-focused. Specialists offer these recommendations for boosting adoptions rates and coaxing users to blend these tools into their daily workflow:
Choose a system that is easy to use: All solutions are not created equal. sales. More recent research indicates that the problem. Some vendors offer more user-friendly applications than others. In a 2007 survey from the U. 72 percent indicated they would trade functionality for ease of use. Even with today’s more usable systems. department-centric views should be discarded in favor of reorienting processes toward information-sharing across marketing.K. If not. And support agents require quick and complete access to a client’s sales and service history. they will work around or ignore the system. For example. is a long way from being solved. while perhaps less severe.
This market grew by 12. Vendor SAP Oracle Salesforce.1 1.8 2006 Share (%) 26.6 15.8) 2.1 4.4 332.6 6.6 43.7 100
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Business intelligence Business Relationship Management Comparison of CRM systems Consumer Relationship System Customer Experience Customer experience transformation Customer Intelligence Customer service contains ISO standards Data management
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Data mining Database marketing E-crm Employee experience management (EEM) Enterprise Feedback Management (EFM) Enterprise relationship management (ERM) Help desk Mystery shopping Predictive analytics
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Professional services automation software (PSA) Public relations Sales force management system Sales intelligence Sales process engineering Support automation Supplier relationship management The International Customer Service Institute .7 1.7 176.0 39. as well as the legislative and cultural norms.8 10.9 2. from revenue of $8.com Microsoft Amdocs Others Total 2008 Revenue 2.050.9 2.15 billion in 2008. Some clients prefer assurances that their data will not be shared with third parties without their prior consent and that safeguards are in place to prevent illegal access by third parties.8 451.055 1.1 365.289. thus a company must consider the desire for privacy and data security.089.5 percent in 2008.5 6.475 965 581 451 3.881.5 6. The following table lists the top vendors in 2006-2008 (figures in millions of US dollars) published in Gartner studies.016.1 5.319.3 16.6 3.9 421.contains customer service standards
.13 billion in 2007 to $9.8 16.6 100 2006 Revenue 1.620 9.681.3 8.573.1 100 8.5 (-2.2 40.3 4.7 5.147 2008 2007 Share Revenue (%) 22.3 2007 Share (%) 25.One of the primary functions of these tools is to collect information about clients.6 676.
p.gartner. "Enterprise Business Systems. Harvard Business Review. ^ "Avoid the Four Perils of CRM". http://www.com/it/page. http://www.304. O'Brien & George M. ^ a b David Sims. McGraw-Hill/Irwin.305.gartner. ^ a b c DestinationCRM.5 Percent in 2008".. ^ a b Gartner.".com/it/page.com (2009) Who Owns the Social Customer? 9. 13. ^ Gartner. 12. ^ Strativity Group. Inc. ^ TechTarget (2009) Strategy Checklist: Planning for CRM and Customer Service Success 11.com (2002) What Is CRM? 3. ^ a b James A. Retrieved 2009-10-27. Inc. Inc (2008-09-12). 18. "Gartner Says Worldwide CRM Market Grew 12. ^ a b SAP Insider (15 November 2007) Still Struggling to Reduce Call Center Costs Without Losing Customers? 6. John Wiley & Sons.
Management Information Systems. (6 June 2009) What's 'Hot' in CRM Applications in 2009 2. ^ DestinationCRM.net (2007) CRM Adoption ‘Biggest Problem’ in 83 Percent of Cases 16. TMC. Passionate and Profitable.com (2009) Sales and Social Media: No One’s social (Yet) 10. "Understanding the Fatal Mistakes". Press release. ^ InsideCRM (2007) Get It Together with Collaborative CRM 8. p. Marakas (2009).
. ^ Clara Shih.".com (2009) CRM Market Grows for Fifth Straight Year 17. (2009) Global Customer Experience Management Benchmark Study 7. CSO Insights (2006) Demystifying CRM Adoption Rates 15. Retrieved 2008-08-15. Inc (2009-06-15). McGraw-Hill/Irwin.
Management Information Systems.. "Enterprise Business Systems. DestinationCRM. 5. ^ James A.Notes and references
1. ^ Gartner..jsp? id=715308. ^ a b Jim Dickie.
4. "Gartner Says Worldwide Customer Relationship Management Market Grew 23 Percent in 2007". ^ a b SAP white paper (2003) CRM Without Compromise 14.jsp?id=1074615. O'Brien & George M. ^ Lior Arussy (2005). ^ DestinationCRM. Press release. Marakas (2009). Inc.