2 hardeep singh research article may 2011

Available ONLINE www.visualsoftindia.com/journal.html

VSRD-IJBMR, Vol. 1 (3), 2011,

RESEARCH ARTICLE

CRM : An Ultimate Tool in Marketing Management

1

ep Singh* and 2

m Pal Singh

ABSTRACT

Customer

Relationship

Management is

directly related to satisfaction of

customers’ needs. CRM takes care of

expectations of the customers and

about what and how a product is

presented to the customer. CRM is the

system that integrates management of

customer groups, establishment and

management of marketing companies

referring to marketing concept,

especially relationship marketing.

Making a practical definition, CRM is

“The ability of an organization to

effectively identify, acquire, foster and

retain loyal profitable customers.”

Coming to the objective, the main

objective of this study is to realize the

importance of Customer Relationship

Management (CRM) in the present

scenario of globalization and

internationalization. Rationale is

viable reasonable approach which is

based on natural values related to

betterment of humanity. No doubt

recent practices have changed but the

rationale approach demands honest

dealings and proper CRM and supply

of proper material which are in the

interest of the customers as well as

proving the integrity of the

manufacturers and suppliers.

Research Methodology used to

conduct this study includes

questionnaires, telephonic interactions

and personal

interviews of

marketing

professionals.

Coming to the

findings, CRM is an

effective tool for

satisfying the needs

of external as well as

internal customers

leading to customer

loyalty. No doubt,

originality is related

to every individual

independently, but

mostly it depends

upon the values that

hold age old

thoughtfulness in the

best interest of

humanity. We express

it in different ways

which become a part of our originality.

Keywords : Customer Relationship Management (CRM), Marketing Management, Customer Loyalty,

Relationship Marketing, Customer Retention, Business Sustainability.

1. INTRODUCTION

In twenty-first century, an intense

competition is in business world due to

new technologies and innovations. Due

to globalization and internationalization

of markets, the companies are realizing

that there is no better competitive

advantage than customer loyalty. CRM

(Customer Relationship Management)

has now become the

____________________________

12Assistant Professor, Department of Training & Placement, Baba Kuma Singh Ji Engineering College, Amritsar, Punjab, INDIA. *Correspondence : [email protected]

Hardeep Singh et. al / VSRD International Journal of Business & Management Research Vol. 1 (3), 2011

most important tool. CRM is a systematic business approach using information and ongoing dialogue to build

long lasting and mutually beneficial customer relationships. CRM mainly is a concept that has been around for a

long time but until today, it was usually ignored as marketing/sales people tried to build a personal relationship

with customers. The ultimate goal of a CRM system is to increase profit and help build a flourishing scope for

business. CRM broadly believes in sustainability of business in this innovative world. CRM greatly improves

efficiency and effectiveness of marketing department. Apart from marketing, CRM covers product development

and resource planning department; all these are essential for prosperous future of a company. CRM plays very

important role in flourishing the marketing department of a company. CRM helps in customer retention and

sustainability. IT (Information Technology) plays very important role in CRM. Synchronizing a company’s

marketing efforts with the overall company strategy can be extremely time consuming. The competition and data

analysis required can be more easily accomplished with the implementation of a proper CRM system. Product

development and improvement is essential for a company to establish a sustainable and competitive business in

today’s changing world of modern technology. CRM and product development groups are related through the

generation of ideas for improvement and new product introductions. A strong and capable IT group is mandatory

to build a sound CRM system so as to support marketing department. The IT group is responsible for maintaining

and managing the integrity of a CRM database. CRM if used properly becomes an active and important

component of a company’s marketing strategy. CRM has the potential to add value to the marketing department

of an organization and to a new product being launched in the market.

2. Meaning of Customer Relationship Management (CRM)

Customer Relationship Management (CRM) is directly related to the satisfaction of customers’ needs. CRM

takes care of expectations of customers and what and how a product is presented to the customer.

CRM is defined as a system that comprises large amount of customer data and presents it in a

suitable manner. This information helps in retaining old customers and developing new potential

customers. CRM plays a vital role in effective decision making in marketing management. CRM really

improves the efficiency and effectiveness of marketing department of an organization.

CRM can also be defined as

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A process of creating and maintaining relationships with business customers/consumers, a

holistic approach of identifying, attracting, differentiating and retaining customers.

A process of integrating the firm’s value chain to create enhanced customer value at every step.

An integrated cross functional focus on improving customer retention and profitability for a

company/organization.

CRM requires organizational and business level approaches – which are customer centric for

marketing management rather than a simple marketing strategy. CRM involves all corporate functions

(marketing/manufacturing/customer service/field sales/field service) required to contact customers

directly or indirectly.

3. MAKING A PRACTICAL DEFINITION OF CRM

CRM is “The ability of an organization to effectively identify, acquire, foster and retain loyal profitable

customers.”

4. MEANING OF MARKETING MANAGEMENT

Management is a broader concept than marketing because it covers Marketing

Management/Manufacturing Management/Human Resource Management (HRM), Service

Management/ Sales Management/Research and Development (R&D) Management.

According to Philip Kotler, Marketing Management is defined as societal process by which

individuals and groups obtain what they need and want through creating, offering and freely

exchanging products and services of value with others.

According to The American Marketing Association, Marketing Management is the process of

planning and executing the conception, pricing, promotion and distribution of ideas, goods, services to

create exchanges, that satisfy individual and organizational goals.

5. IMPORTANCE OF MARKETING MANAGEMENT

The importance of marketing to a competitive business strategy becomes apparent when investigating

the seven key areas of the field: -

Product, Price, Place, Promotion, Process, Physical Evidence and People.

All areas must be effectively examined closely, if an effective strategy is to be implemented.

Product is concerned with what a company is offering. It is very much important to know what a

customer/consumer wants and to produce/market the product to meet those wants.

Price is very influential to many customers’/consumers’ key perceptions in different products. With proper

marketing research, maximum selling price can be determined still with customer’s great interest. It is up to

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marketing department – customers can be turned off to very high as well very low prices.

Place become equally important whereat the marketing of the product should be launched/introduced. Every

product has its own market and customer section, depending upon age/sex/job status/religion/demographics. It is

very much important to keep in mind the place factor by the marketing department.

Promotion is again very important key area for marketing department while setting marketing

strategy. Using proper combination of advertising, sales promotion, personal selling and public

relations will help companies capitalize on every rupee spent thereat.

Process is fifth key area to be considered by marketing department. It includes a set of activities involved in

marketing.

Physical Evidence is the sixth important key area to be considered in marketing management.

Physical evidence involves establishment/ facility/ layout/ equipment/ design/ surroundings to be

considered while offering a product to the customer.

Finally People are the seventh important key for consideration by the marketing department. People include

employees (education, training and development, motivation) and customer (education, information, awareness).

6. NEED OF STUDY

In competitive times the challenge is to keep the customers in fold. Companies/organizations lose many

loyal and profitable customers due to absence of CRM. There has been a great urgency of CRM in

marketing management as best as possible to compete well in today’s innovative business world of high

technology. So to create new customers and to retain old (loyal and profitable) customers, it is very much

urgent to implement CRM in marketing management. To survive in today’s tough competitive business

environment, CRM is very much necessary. CRM leads to customer retention, customer loyalty, customer

satisfaction, and word of mouth publicity. Further more to say, as CRM put in practicality produces new

customers and retain old customers, leads to increase in sales and profits of organization that further leads

to growth and development of the organization/business. The major importance of CRM is that it also leads

to good public image of the organization without which no business is possible. Lastly it is very much right

to say that CRM is deciding factor for tomorrow’s business.

7. OBJECTIVES OF STUDY

To realize the importance of Customer Relationship Management (CRM) in the present scenario

of globalization.

To make professionals familiar with the recent innovations that takes place in the Customer

Relationship Management (CRM) system as a result of globalization.

To excite awareness about the role of Customer Relationship Management (CRM) for the purpose

to satisfy the needs of external as well as internal customers.

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To realize the role of Customer Relationship Management (CRM) in retaining old customers and

producing new customers in this tough competitive business world.

To realize the role of Customer Relationship Management (CRM) in creating a good public image

of the company in this tough competitive business world.

To realize the importance of Customer Relationship Management (CRM) in increasing the sales thereby

increasing the profit and market share of the company in this tough competitive business world.

To realize the importance of Customer Relationship Management (CRM) to understand

organizations to know their impact on people, clients, suppliers, society and environment.

To highlight the role of Customer Relationship Management (CRM) in marketing management.

To disclose various types of Customer Relationship Management (CRM) by referring to marketing concept.

To make aware that Customer Relationship Management (CRM) significantly affects a company’s

public image.

8. RESEARCH METHODOLOGY

The study was conducted through questionnaires, telephonic interactions and personal interviews. The study

examines major aspects concerned with the role of Customer Relationship Management (CRM) in the global

marketing management. The data for study was collected from the marketing experts. The study mainly focuses

on the extent of sustainability achieved in the market through the Customer Relationship Management (CRM). In

this study, mostly individuals from the reputed companies were taken into consideration. The questionnaire,

before sending was first tested and refined after consulting the marketing experts.

9. DEVELOPMENT OF CRM

The Computer Telephony Integration (CTI) system started in 1996, when telephone number display

service was introduced in Japan. CTI is called the predecessor of CRM. Computers were connected

with telephone and customer information was displayed on a database when call from customer was

received. Before the word CRM came into existence, CTI was synonymous with customer care.

CRM’s first generation was developed during 1998-2000. Email and web are new channels which

were used to connect customers with companies. The goal of the first generation was to strengthen

customer – Company relations for each channel.

CRM’s second generation came into existence during 2000-2002. The companies realized that they

should manage their customer information independently for each channel. The companies came into

the point that they should build synthetic relations with customers that further lead to present a clear

image to their customers. By unifying the customer information gathered by various channels,

knowledge about customer vastens and deepens.

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Now we are passing through 21st century that is a time of innovative hi-tech world. Various internet channels

have been established and spread through the world. Now this is electronic era in which e-CRM has its own

place. In the first half of 1990, many dot com companies in US began selling its products online.

CRM’s third generation came into existence when flow of CRM joined with supply chain

management (SCM), in which customer area and back office became united. The third generation of

CRM makes it possible to synthetically use various customer information collected in a company in

order to do effective marketing, effective production and customer service activities.

10. MYTHS OF CRM

Excellent CRM system guarantees marketing success.

To use CRM, a company must be organized by customer segments rather than products.

Successful CRM requires a large centralized database with complete customer data.

CRM requires the most advanced and sophisticated analytical technique.

CRM is a turn-key project.

11. BENEFITS OF CRM

CRM is the process or method used to know the customers’ needs and buying behaviors. The sole aim of

CRM is to develop strong and deep relationships with the customers, so as to benefit the business as well

as the customers. According to the concept “Customer is the King” – the needs and desires of the

customers hold a vital place in the minds of the business and businessmen. CRM is considered as a

process that brings together pieces of information related to sales, customers, marketing effectiveness,

market trends and responsiveness. The process of CRM aids businesses in using both human resources

and technology to gain an insight into customers’ behavior. This helps business to serve their customers in

a better and more satisfactory manner. The many benefits of CRM include:

11.1. Benefits of CRM Systems for a Customer

Customer gets an offer in an appropriate form when it is necessary and what is necessary. He/she

gets served, feels important, gets informed in time and lastly gets a possibility to choose a service

channel (self-service, full service).

11.2. Benefits of CRM system for an Employee

The system has to be friendly. It helps to fulfill more actively during the same time and a higher salary is related

to it. It creates the feeling of self control, a possibility to show oneself as leader and sound competition emerge.

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11.3. Cost Decrease

Increased total effectiveness, an automated process of sales, service and marketing companies, decreased cost

of customers’ management, automated routine work – all come under cost decrease benefit of CRM.

11.4. Customer Loyalty

CRM helps to select the most useful clients of the company. Companies most frequently patronize

their main customers and use systematized media of customer’s stimulation and loyalty development.

11.5. High Profit

Collected data about consumers becomes known and it determines the profit process for the company. At

present, most companies recognize evident benefit of CRM and almost every company either uses certain

CRM technologies supporting their business, or evaluates specific benefit of CRM technology and plans its

future realization. The achieved high profit is the main benefit of CRM for proprietors.

11.6. Better Identification of Customer Needs

The process of CRM helps to identify the customers’ needs and requirements in a more effective

manner. Businesses are able to deliver better products and services to their customers.

11.7. Improved Sales

CRM helps to identify and anticipate the needs and desires of the customers in a better way and prior

to those business that do not have an effective CRM. This leads to increased sales, as companies

that have an efficient CRM bring innovative and beneficial products into the market.

11.8. Enhanced Cross-selling

Effective CRM helps to increase the selling of other products that are directly or indirectly related to

the main product. The business can highlight and suggest substitutes and enhancements of the main

product that is desired by their customers.

11.9. CRM helps to categorize the customers

An effective process of CRM helps to categorize and differentiate between the customers that are

profitable for the business from those who are unprofitable for the business.

11.10. CRM enhances Customer Satisfaction

Effective CRM aids to enhance customer satisfaction towards the business and its products. Satisfied

customers can be successfully retained for long time periods without making such effort. This ensures

good reputation of the business both in the market place and in the minds of the customers.

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12. TECHNOLOGY OVERVIEW OF CRM

Initially CRM was started in call centers, where technology used was CTI. At that time, call center packages were

produced by taking advantage of its expertise in both company and telecommunication technology. Internet has

diversified the channels between companies and customers. Now a day, CRM need to handle the channels like

e-mail, websites and telephone regulatory. An automatic email response system has been developed for

responding to inbound e-mail enquiries of the customer. By taking advantage of stored customer

data/information, it is important to approach customer with appropriate outbound e-mail messages.

Data mining is another key which is used for stored customer information. Data mining is a process that

uses a variety of data analysis and modeling techniques to discover pattern and relationships in data that is

used to make appropriate accurate predictions. It helps in selecting right prospects, offering right additional

products to existing customers and identify good customers who may be about to leave. CRM applications

that use data mining are called analytical CRM. This method enables us to enhance our sales by sending

e-mail sales promotion messages to the customers. Another web oriented system is Intelligent Configrator,

which provides the customer appropriate set of products, options and services. CRM helps in acquiring

new customers, increasing the value of customers and retaining good customers.

Basic steps of data mining for effective CRM are as follows:

Define business problem.

Build marketing data base.

Explore data.

Prepare data for modeling.

Build model.

Evaluate model.

Deploy model and results.

13. CRM Implications in Marketing

CRM can be implemented within a company independent of company’s size or amount of goods or

services selling; both within small and big companies that value quality of the customer’s service,

his/her loyalty, less sensitivity for price changes and that recognize, that to attract a new customer is

much more expensive than to sustain the present one. To implement CRM in an effective way, an

integration of firm’s resources is required. Further, marketing capabilities of marketing people are also

required to deliver added value to the customers. CRM is enabled through information, processes,

technology and applications. A company that is looking to implement CRM in an effective way in this

competitive hi-tech world must align its business processes cross-functionally in the best possible way

to allow increased customer focus with an aim to deliver added value to customers.

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Following steps should be followed to implement CRM:

Develop a CRM framework.

Align current business processes.

Design new cross functional business processes.

Develop functional specifications (client side services).

Develop technical specifications.

Match technical specification to the available technology (system/software etc.).

Product configuration.

Data migration and integration.

Staff training.

To strengthen customer relationships, following actions should be applied:

Identification of individual features, wishes of each customer.

Modeling of current and potential purchasers.

Creation of business plans and strategies beginning with most profitable projects.

Reorganization of company’s activity is necessary for creating close relations between the

company and customers.

According to views of various management thinkers and philosophers, in order to implement CRM

successfully in an effective way, it is very much urgent to balance integrate technologies, processes

and people. All these elements are closely related to company’s strategy, process of technologies,

and process of integration of overlapping of functions as well as orientation to basic customers.

14. CRM BY MARUTI SUZUKI INDIA LIMITED

Maruti Suzuki India Limited is one of the India’s leading four-wheeler automobile manufacturers and

market leader in the car segment, both in terms of volume of vehicles sold and revenue earned. The

company headquarter is in Gurgaon, Haryana.

Maruti Udyog Limited (MUL) was established in February 1981, though the actual production commenced

in 1983 with the Maruti 800, based on the Suzuki Alto key car which at the time was the only modern car

available in India. Its only competitors- the Hindustan Ambassador and Premier Padmini were both around

25 years out of date at that point. By 2004, Maruti has produced over 5 Million vehicles.

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Maruti Suzuki offers 13 models, Maruti 800, Alto, Ritz, A Star, Swift, Wagon R, Zen Estilo, Dzire, SX4, and Grand

Vitara. Swift dzire, A star and SX4 are manufactured in Manesar; Grand Vitara is imported from Japan as a

completely built unit (CBU); remaining all models is manufactured in Maruti Suzuki's Gurgaon Plant.

In these competitive times the challenge is to keep inventing newer ways to do things to keep the

customers in your fold. Over the last few years, the company strengthened the existing practices and

experimented with many new initiatives by way of Kaizens to delight its customers. These initiatives

ranged from product design and quality to network expansion and included new service programs to

meet unsaid needs of customers. The company has retained its competitive edge by offering high

quality products. In the field, the products are supported by rapidly expanding networks. The company

has diverse networks for new cars, spares, service, pre-owned cars and so on, and all of them were in

expansion mode last year to enable the company get closer to the customer.

Servicing customers 24X7..... 365 days....

The company takes great pride in sharing that customers have rated Maruti Suzuki first once again in Customer

Satisfaction Survey conducted by independent body, J.D.Power Asia Pacific. It is 9th time in a row.

The company was first Car Company in India to launch a Call Centre in the year 2000.

The award mirrors the company's commitment towards "Customer Obsession”.

Key Initiatives were Car pickup and delivery facility for women car owners. "The study finds that

vehicle pickup and delivery before and after service has a strong impact on customer satisfaction. In

particular, customers who say that their vehicle was picked up from their doorstep before service and

delivered to the same point after service are notably more delighted with their after-sales service

experience, compared with customers who do not receive this service...." Maruti also launched

mission to promote safe driving habits jointly with Institute of Driving Training and Research.

It also launched ‘Dil Se’- a special program for Indians living abroad or NRIs to facilitate them to

gift Maruti cars online to friends and relatives at home.

Online club ‘Swift Life’ is made for all Swift owners.

Setting up "Express Service Bays" and "2 - Technician Bays"

As the name suggests the company set out to delight its customers by offering them faster car service by

introducing new concepts such as Express Service Bays and 2- Technicians Bays. These are done for

customers who are hard pressed against time. Both the initiatives undertaken in this direction have helped

improve customer interface and also helped increase the productivity and capacity of existing workshops.

Mega Camps : The Company aggressively conducts 'Mega Camps' throughout the country round the year.

Activities undertaken during a mega camp include complimentary car wash, Air Condition (A/C) and Pollution

check up, oil and fuel top ups, wheel alignments etc. Apart from mega camps workshop camps like Air

Condition A/C checkup camps and general check-up camps, Locality camps, Pre monsoon camps

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etc. are also regularly conducted as part of customer connect initiatives.

Service at Door Step through Maruti Mobile Support : Another unique initiative is the door step

service facility through Maruti Mobile Support. Maruti Mobile Support is the first of its kind initiative and

is expected not only to help the company reach out customers in metro cities but also as a means to

reach semi urban /rural areas where setting up of new workshop may not be viable.

Car Safety device: Immobilizer : The company used technology to meet customers’ needs and even

delight them. Following feedback that the company's cars were more prone to theft owing to their resale

value, the company worked on an anti-theft immobilizer or "I-Cats;" system for all its new cars.

Complete car needs : The company's effort of providing all car-related needs -- from learning to drive

a car at Maruti Driving Schools to car insurance, extended warranty and eventually exchanging the

existing car for a new one -- under one roof. Dealerships also enhance customer satisfaction.

15. CRM BY INTERNATIONAL BUSINESS MACHINES CORPORATION (IBM)

International Business Machines Corporation (IBM) is an information technology (IT) company. The Company’s

major operations include a Global Technology Services (GTS) segment, a Global Business Services (GBS)

segment, Systems and Technology segment, a Software segment and a Global Financing segment. The History

of IBM goes back further than the development of computers. It was originally a Tabulating Machine Company

founded in 1896 by Herman Hollerith. It specialized in developing punched card data processing equipment. The

patent for this technology was initially applied for in 1884. It began as a means for Hollerith to meet the demands

in tabulating the 1890 Census. Punch cards introduced in 1896 laid the foundation for generations of equipment

which was one day known as IBM. The business was sold to Charles Flint in 1911 for 2.3 million dollars of which

he received 1.2 million dollars to create Computing Tabulating Recording Corporation or CRT. Incorporation took

place on June 16, 1911 in Endicott, New York. There were three companies which merged. The computing Scale

Corporation, the Time Recording Company and finally the Tabulating Machine Company. Flint was the key

financier behind the merger and remained a member until 1930. In 1914 Thomas J. Watson Sr. became General

Manager of CTR and in 1917 CTR entered the Canadian market using the name International Business

Machines Co. Limited. Watson played an essential and key role in establishing what was later known as IBM. In

1928, IBM introduced a new 80 column rectangular-hole punched card, which became the standard IBM card

used by tabulators and computers for many years to come. Later in the 1950’s IBM became the primary

contractor in developing computers for the United States Air Force automated defense systems. While working on

the SAGE interceptor control system IBM gained information critical to work being performed at Massachusetts

Institute of Technology. This information spearheaded advancements for the company by learning information on

digital data transition, algebraic computer language, light guns, integrated video display, analog to digital and

digital to analog conversion. IBM built fifty six SAGE computers totaling thirty million dollars each and in its

heyday employed more than seven thousand employees. The 1980’s found IBM consolidating its mainframe

business and expanding the breadth of mainframes with the ESA/390 and the S/390. To create the illusion that

IBM’s revenues and profits were much stronger than they really were in the mid to latter part of the decade, IBM

embarked upon the practice of converting its large rental

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base of mainframes to lease arrangements. This spending shift caused management to scramble, which

threatened the monopoly which IBM had enjoyed in the technology business. Don Estridge was hired in the

IBM Entry Systems Division in Boca Raton Florida. It was at this point that he along with his team known as

“Project Chess” developed the IBM PC which was then introduced to the world on August 12 1981. Initially

these systems were not affordable to the average person for personal use. The hefty price tag of $1.565 left

the equipment primarily in the business sector, although these were not seen as viable computers by the

corporate computer departments. Often the purchases were made by middle management as they could

see the value these systems had in relation to business. In January 2008, IBM announced that it has

completed its acquisition of Cognos Incorporated. In August 2007, IBM acquired Web Dialogs, Inc. In

September 2007, IBM completed the acquisition of Data Mirror Corporation. In January 2008, IBM acquired

XIV, a privately held storage technology company based in Tel Aviv, Israel. In February 2008, the Company

acquired Arsenal Digital Solutions and Net Integration Technologies Inc. In April 2008, the Company

completed the acquisition of Tele-logic AB, Diligent Technologies, FilesX and Info Dyne Corporation. In July

2008, the Company acquired Platform Solutions; Inc. IBM operating systems have paralleled hardware

development. On earlier systems, operating systems represented a modest level of investment, and were

typically viewed as an addition to the hardware. By the time of the System/360, operating systems had

assumed a much greater role, in terms of cost, complexity, value, and risk. IBM has widely been known for

its dominant computer business. However, it has had major roles in many other industries. Today IBM

enjoys continued success with systems easily applicable to businesses as well as personal use.

IBM WebSphere ILOG Business Rule Management Systems (BRMS) enhance CRM implementations

by delivering:

Personalization: Get highly customized interactions and personalized offers.

Flexibility: Create and update business rules in real time. Test and "hot deploy" new programs,

promotions and interaction flows in mere hours.

Real-time Response: Facilitate immediate reactions to customer insights or interactive events

with special offers such as cross-sell and up-sell.

Smart Business Decision Making: Perform complex decisions and operations quickly and

accurately. These operations might include determining eligibility for a program, computing

interest rates or routing requests to the right business processes.

Multi-channel Consistency: Get a universally consistent decision making and customer

experience across all touch points: such as Web, retail, mobile and call centers.

The advantages of a non-disruptive BRMS extension to the existing CRM system are:

Increase revenue at the point of contact, with more frequent and focused cross-sell and up-sell offers.

Improve customer and partner satisfaction by proposing appropriate pre-approved client-centric offers.

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Reduce time-to-market for product or promotional changes by empowering your business users to

perform changes in real time.

Improve audit-ability by consolidating otherwise rigid processes.

IBM has experts available to meet one’s SAP CRM requirements. One can save time, and probably

some significant costs, by utilizing IBM's managed hosting services.

The benefits of IBM CRM services include:

SAP CRM on demand experts available 24x7

IBM hosting provides "always-on" operating environment

Flexible pricing for small and large businesses

Industry-leading service level agreements

Extensive SAP application experience

Optional disaster recovery plans

IBM CRM Outsourcing increases the likelihood of success for large-scale organizational change projects -

reduces the risks of implementing large-scale change by using vast expertise and economies of scale. IBM

is a leader in the operation and transformation of key CRM business processes - including managing staff

through the transformation, acclimatizing employees who are joining the provider, and educating the

remaining client employees to use the services delivered through the CRM solution.

IBM CRM Outsourcing accelerates "time to benefit" – IBM offers a complete CRM solution including

change management. Expected results and timing are agreed upfront and written into the contract.

IBM shares the risks and is accountable for delivering business results.

IBM CRM Outsourcing enables to sustain competitive advantage – IBM commits to continuous strategic change

by benchmarking to leading practice and measuring expected changes against business outcomes.

IBM CRM Outsourcing can deliver upfront and ongoing cost savings - Through IBM’s scale, it can

offer lower transaction costs and drive ongoing savings by continuously benchmarking services to

current best practice and beyond.

16. CRM BY DELL

Michael Dell, in 1984 founded Dell in Texas in order to directly serve their customers with computers that met

their needs. The company was called PC’s Limited and he was still a student at University of Texas at the time.

The following year, Dell came out with their very first computer called the Turbo, which had an eight-megahertz

processor. The major goal was to produce personal computer systems that were IBM compatible and were

produced or entirely stock parts. What set the company apart were its consumer-oriented focus and also its

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allowance for people to customize their computers during the ordering process. Because each computer was

individually assembled, this was possible. The company grossed 73 million dollars in the first year. The company

went public in 1988 offering shares for $8.50 a piece. The first Dell laptop made its debut in 1991 and by 1993; it

became one of the top five computer companies in the world. By 1995, those$8.50 shares were worth $100. The

progress of the business was rapid and in1997, Dell had shipped its ten millionth systems. In 1996, Dell began

selling their products through their website and three years later they took over Compaq. Jumping forward a bit,

in 2003, Dell introduced their first printers for the public, including those intended for the average consumer and

businesses. Dell printers are known for being versatile and easy to use; however a recent development has

brought skepticism to the company when Lexmark began working with them whom modified their cartridges so

that they don’t work with Dell printers. Dell is renowned for its direct sales to customers by phone, Internet and

now through e-business enabling consumers to go through the whole sales process online. What is less well

known is that Dell, in 2005, took on 150 salespeople to sell their products in United Kingdom/Europe. The reason

for this change from direct selling to personal selling is that the cost of a salesperson for an individual customer

makes no economic sense, but if one is selling many computers, printers, servers and other products and

ancillaries to one customer then personal salespeople are required to understand the customer’s needs, offer

appropriate solutions and sell the correct package. In this regard, Dell must compete with HP and IBM for

business customers on a more personalized service basis. Dell’s background is interesting as the company

pioneered direct selling and mass customization. Founded in Texas in 1984, by 1992 Dell had made the Fortune

500 list and in 2004 was ranked 34 in Business Week’s Global list of the world’s most valuable companies. In

1996, Dell began to sell computers on the Internet, and within 2 years, sales were exceeding $3 million per day.

Much of this was due to the way Dell reduced transaction costs by cutting out expensive distribution and sales

channels, including the high cost of personal salespeople. The Dell direct selling model gave the company

infrastructure leanness, market agility, minimal Inventory, high customer differentiation and high customer

relationship. Although relatively weak compared with competitors in R & D (Dell 1.3% of revenues; HP 5.8%; IBM

5.9%), the financial discipline using off-the-shelf components and assembly technology gave it a market-leading

performance, quality, price combination and excellent rewarding customer relationship. Till now Dell Computers

has operated on two simple ideas:

Sell computers directly to individual customers

Manufacture computers based on customer’s order and needs.

The user can contact the company website directly if system has any problem and get personalized

services by using customer system service tag number, which is given on the side of the computer.

Call centre technical assistance is also available.

17. FINDINGS

Customer Relationship Management (CRM) is an effective tool to satisfy the needs of external as

well as internal customers leading to customer loyalty.

In the globalize business, Customer Relationship Management (CRM) can significantly affect a company’s

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public image.

Appropriate and reasonable Customer Relationship Management (CRM) can increase profits and

market share.

Customer Relationship Management (CRM) is the best and most appropriate source to enhance

sales on the global level.

Customer Relationship Management (CRM) acts as an effective tool to minimize the risk of

customer loss in this tough competition.

18. SUGGESTIONS

CRM should be implemented after creating a customer strategy/marketing strategy. Many management

thinkers believe that implementing CRM software is equivalent to creating marketing strategy. But in real

sense, CRM software is just an enabler to move their strategy into action. Before implementing CRM

software, a company should formulate appropriate strategy and clarify the purpose of the strategy.

Regular communication with the old customers should be there so as to retain them and then

convert into lifelong loyal customers.

Company must highlight ‘where we are’ in the project, sharing milestones and informing staff

‘what happen next’.

Company should establish contacts with individuals who have a real interest in the company and

products. When the company approaches the wrong people who do not have any real interest in

the company, they are perceived as stalkers and lose potential customers.

To make CRM effective and successful, there should be full cooperation and co-ordination of various wings

that are involved in company’s various functions such as the production processes, latest innovations

involved, marketing practices and healthy maintenance of employees and customer relations.

19. CONCLUSION

Building relationships with customers becomes necessity in the present scenario of globalization and

internationalization of markets. Based on different analysis, the system of CRM enables to determine the best

strategies and their effective implementation that company should apply for particular customer groups. CRM is

the system that integrates management of customer groups, establishment and management of marketing

companies referring to marketing concept, especially relationship marketing. CRM is a system to enhance and

support the efforts of the company as a whole by organizing and analyzing information. If implemented correctly,

CRM can be a great tool for improving profitability, customer satisfaction and reducing overall costs. Cost

reduction can be realized in many functional aspects of a company most notably, by making efforts for efficient

and effective role in the areas of sales, resources planning and product development. CRM is essential to

compete effectively in today’s highly innovative Hi-tech business world. The most effective one can use the

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information about the customers to meet their needs to their full satisfaction. The route to a successful business

requires that one understands one’s customers and their requirements, and CRM system is the essential guide.

Generally speaking, the cost of implementing CRM is quite high. Today implementing CRM is such a major

project that most executives are apt to think that CRM is a software tool that will manage customer relationship by

itself. Actually in real sense, CRM is the bounding of customer strategy and processes, supported by the relevant

software, for the purpose of improving customer loyalty and eventually, corporate profitability.

20. ACKNOWLEDGEMENTS

We hereby acknowledge the contribution of information providers to give us proper information and enable

us to write this paper. We would also like to thank the eminent personalities who spared their precious time

to respond to our questionnaires, personal interviews and telephonic interviews. Without the contribution of

these people it was not only difficult but even impossible to write an empirical research paper. We once

again thank all and one who contributed in our research work by providing us worthy information.

“Professor Joginder Singh Jogi”

Moreover we are highly thankful to an eminent learned educationist, “Professor Joginder Singh

Jogi” – Dean Academics, BKSJEC, Amritsar, Punjab, India, for his cordial support and motivating us

for doing this creative research work and publications. May he live long!

21. REFERENCES[1] Business Week ‘What you don’t know about Dell’(3 Nov 2003) 46–54

[2] Customer Relationship Management (2001, December10). The Tribune, Chandigarh.

[3] Dell, M. S. and Fredman, C. (1999) Direct from Dell London: HarperCollins

[4] Jelinkova, Martina, Lostakova, Hana & Munzarova, Simona (2006). Process of Complex CRM,

1(10), 59-60.

[5] Kotler, Philip (2000). Marketing Management – The Millennium Edition. New Delhi: Prentice Hall

of India Private Limited.

[6] Maruti Suzuki India Limited. CRM by Maruti Suzuki India Limited. Report Submitted by: Kumar

Vaibhav Singh

[7] Reintartz, Werner, Krafft, Manfred & Hoyer, Wayne D. (2004). The CRM Process: Its Measurement and

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Impact on Performance. Journal: Marketing Research: Forthcoming, 1-2.

[8] Sanchez, John G.. Customer Relationship Marketing. Research Paper, 28-32.

[9] SEDONA Corporation (2001). The ABC’s of CRM. Suite, By Alyssa Dver, Chief Marketing Officer,

SEDONA Corporation.

[10] Ueno, Satoshi (2006). The Impact of Customer Relationship Management. USJP Occasional Paper, 06-13

[11] Urbanskiene, Ruta, Zostautiene, Daiva & Chreptaviciene, Virginya (2008). The Model of

Creation of Customer Relationship Management System. Journal: Engineering Economics, 3, 58

[12] www.dell.com

[13] www.ibm.com

[14] www.Support.Dell.com

[15] www.DellEWorks.com

[16] www.Premier.Dell.com

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