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Chapter - 8

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Learning Objectives
Identify and give examples to illustrate the
following aspects of customer relationship
management, enterprise resource management,
and supply chain management systems:
Business processes supported

Customer and business value provided

Potential challenges and trends

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Section I

Customer Relationship Management:

The Business Focus

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Customer Relationship Management

Provides customer-facing employees with a
single, complete view of every customer at every
touch point and across all channels

Provides the customer with a single, complete

view of the company and its extended channels

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Customer Relationship Management (continued)

CRM

 Uses information technology to create a cross-

functional enterprise system that integrates and
automates many of the customer serving processes in
sales, marketing, and customer services that interact
with a company’s customers.

 Creates an IT framework of Web-enabled software &

databases that integrates these processes with the rest
of the company’s business operations

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Customer Relationship Management (continued)

Includes software modules that provide tools that

enable a business & its employees to provide fast,
convenient, dependable, consistent service to its
customers.

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Customer Relationship Management (continued)

Major Application Components of CRM

 Contact & Account Management
 Helps capture and track relevant data about past and planned
contacts with prospects & customers.
 Information is captured from all customer touchpoints such
as phone, fax, email, retail stores, company website etc.
 Stores the data in a common customer database that
integrates all customer account information and makes it
available throughout the company via internet, intranet and
other network links.
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Customer Relationship Management (continued)

Sales

Provides sales reps with software tools &

company data needed to support & manage
their sales activities.
Helps optimize cross-selling & up-selling

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Cross-selling
Offering similar or complementary
products and services to increase sales.

Up-selling
Offering an upgraded version of the
product in order to boost sales and profit.
Promotion
Comment

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Customer Relationship Management (continued)

 Marketing & Fulfillment

 Helpsaccomplish direct marketing campaigns by
automating tasks
 Helps capture & manage prospect & customer response
data in CRM database
 Helps in the fulfillment of prospect and customer
responses and requests by quickly scheduling sales
contacts & providing appropriate information on
products & services to them

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Customer Relationship Management (continued)

Customer Service and Support

 Provides service reps with software tools & real-
time access to the common customer database
shared by sales and marketing professionals
 Helpscustomer service managers create, assign, &
manage requests for service from customers
 Callcenter software
 Help desk software

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Customer Relationship Management (continued)

Retention and Loyalty Programs

Helps the company identify, reward, and market

to their most loyal and profitable customers

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Customer Relationship Management (continued)

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Customer Relationship Management (continued)

Three Phases of CRM

Acquire (new customers)
A business relies on CRM software tools and
databases to help it acquire new customers by doing
a superior job of contact management, sales
prospecting, selling, direct marketing, & fulfillment.
 The goal of these CRM functions is to help
customers perceive the value of a superior product
offered by an outstanding company.
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Customer Relationship Management (continued)

Enhance (customer satisfaction)

By supporting superior service from a

responsive networked team of sales and service
specialists.

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Customer Relationship Management (continued)

Retain (your customers)

CRM analytical software and databases help a
company proactively identify and reward its
most loyal, profitable customers to retain

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Customer Relationship Management (continued)

Benefits and Challenges of CRM

Allows a business to identify its best customers –
those who are the most profitable
Makes possible real-time customization &
personalization of products & services based on
customer wants, needs, buying habits, & life
cycles

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Customer Relationship Management (continued)

Benefits and Challenges (continued)

Enables a company to provide a consistent

customer service experience

Failures

Dueto lack of understanding & preparation.

CRM is not a silver bullet

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Customer Relationship Management (continued)

Trends

 Operational CRM
 Supports customer interaction with greater

convenience through a variety of channels,

including phone, fax, email, chat, mobile devices
 Analytical CRM
 Extracts in-depth customer history, preferences and

profitability information from your data warehouse

and other databases

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Customer Relationship Management ( continued )

 Collaborative CRM
 Enables easy collaboration with customers,

suppliers, and partners.

 Portal-based CRM
 Provides all users with the tools and information

that fit their individual roles and preferences.

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Section II

Enterprise Resource Planning:

The Business Backbone

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Enterprise Resource Planning

Serves as a cross-functional enterprise backbone
that integrates & automates many internal
business processes and information systems

Help companies gain the efficiency, agility, &

responsiveness needed to succeed today

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Enterprise Resource Planning (continued)

Gives a company an integrated real-time view of its

core business processes
ERP software suites typically consist of integrated

modules of…
Manufacturing

Distribution

Sales

Accounting

Human Resource Management

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Enterprise Resource Planning (continued)

Benefits and Challenges

Quality and efficiency
Helps improve the quality and efficiency of
customer service, production, & distribution
by creating a framework for integrating and
improving internal business processes

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Enterprise Resource Planning (continued)

Decreased Costs
Reductions in transaction processing costs
and hardware, software, and IT support staff

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Enterprise Resource Planning (continued)

Decision Support
Provides vital cross-functional information on
business performance to assist managers in
making better decisions

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Enterprise Resource Planning (continued)

Enterprise agility
Results in more flexible organizational
structures, managerial responsibilities, and
work roles

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Enterprise Resource Planning (continued)

Costs of ERP
The costs and risks of failure in implementing a
new ERP system are substantial.

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Enterprise Resource Planning (continued)

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Enterprise Resource Planning (continued)

Causes of ERP failures

Underestimating the complexity of the planning,
development, and training required
Failure to involve affected employees in the
planning & development phases and change
management programs

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Enterprise Resource Planning (continued)

Trying to do too much, too fast

Insufficient training

Believing everything the software vendors

and/or consultants say

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Enterprise Resource Planning (continued)

Trends

Flexible ERP
Web-enabled ERP

Interenterprise ERP

E-Business Suites

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Section III

Supply Chain Management:

The Business Network

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Supply Chain Management

A cross-functional interenterprise system that
uses IT to help support & manage the links
between some of a company’s key business
processes and those of its suppliers, customers, &
business partners.

Goal is to create a fast, efficient, & low-cost

network of business relationships.

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Supply Chain Management (continued)

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Supply Chain Management (continued)

Electronic data interchange

Exchanging business transaction documents

over the Internet & other networks between

supply chain trading partners

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Supply Chain Management (continued)

 The Role of SCM

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Supply Chain Management (continued)

Benefits and Challenges

Can provide faster, more accurate order

processing, reductions in inventory levels,

quicker time to market, lower transaction and
materials costs, & strategic relationships with
suppliers

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Supply Chain Management (continued)

Problem causes
Lack of proper demand planning knowledge,

tools, and guidelines

Inaccurate or overoptimistic demand forecasts

Inaccurate production, inventory, and other

business data
Lack of adequate collaboration

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Supply Chain Management (continued)

 Trends

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