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Customer Relationship Management

Reasons of Success or Failure of CRM Projects From the Perspective of Advisors

Written by Bahman Moghimi

Paper category

Master Thesis


Business Administration>General




Master Thesis: CRM Definition Although "customer is king" has been a mantra since the 1940s, in fact we cannot call them (1) paying customers, (2) employees, (3) suppliers or suppliers, (4) Partner. This means that historical customers have become contemporary customers with whom you exchange value (Greenberg, 2001). There is a standard industry road response to memorize what CRM is and what CRM is not. Of course, it is not a technology, although technology is the enabler of CRM. It is a strategy and/or a set of business processes, or rather a methodology. Knowledge Capital Group defines CRM as a subset of enterprise relationship management (ERM), involving customers, suppliers, partners, and employees (ibid., P9). CRM can be a personal understanding of most small business owners and merchants who trade face-to-face; scale allows them to understand and understand their customers or a very large enterprise to integrate the entire system process and predict what "customers" want or want . At its core, CRM is an enterprise's broad way of thinking, mantra, and a set of business processes and policies aimed at acquiring, retaining and serving customers​​. (Ibid., p. 13) There are many definitions of customer relationship in the literature, such as [Homburg 1995], [Meyer/Oevermann 1995], [Peppers/Rogers 1999], [Belz 1998], [Bliemel/Eggert 1998], [ Diller/Kusterer 1998], [Andersen et al. 1999], [ECCS 1999]. Harker summarized 26 definitions of relationship marketing in his paper (Harker, 1999). I apply his definition as the final statement: "Customer relationship management in business media includes the design, development, and application of the overall concept to manage the relationship with current or future customers with economic value" (Buehrer, 2002). In order to distinguish it from the traditional CRM perception, I applied this definition because it represents the overall view of customer relationship management. (Ibid.) 2.2. Types of CRM The actual information system architecture in practice includes operational, analytical, and sometimes collaborative CRM. These information systems are often arranged as part of a "closed loop" control system (winter 2005). Operational CRM: This is the front-end CRM, which supports and simplifies communication, and involves areas of direct customer contact, such as call centers or e-mail promotions (Johansson/Sparredal, 2005). Operational CRM attempts to provide seamless integration with back-office transactions through the customer interface. Most self-described CRM products on the market today fall into the operational category (ibid.). 2.3. CRM goals In this section, the different goals of CRM will be discussed to show different views on the subject. Therefore, we have verified here the "CRM Goal" (Greenberg 2001 refer to the author below) 2.3.1. Burnet’s goals: Bernet (2001) discusses that CRM goals are generally divided into three categories; cost savings, revenue increase, and strategic impact. From his perspective, he gives the following three CRM goals: 1. Win rate: due to "sales process "It will be improved; thereby achieving more win-wins within the organization. 2. Increase profits: Since you know your customers better, your efforts will be on time and customized to win more profits. 3. Improve customer satisfaction: As mentioned in the previous article, more customized offers will provide more loyalty to the right people at the right time. 4. Reduce general sales/management costs: You have a designated target market, carefully subdivide, and clearly manage their knowledge; therefore, it is obvious that the cost of marketing and sales process or other management or inventory costs will be greatly increased. 2.3.2. The goals of Wilson, Daniel & McDonald Wilson, et al. (2002) claim that organizations are increasingly aware of the importance of being close to customers and their expanded corporate business units. Therefore, the goal of CRM to meet specific needs is to provide the right price to the right customer at the right time through the right channel. The goals are as follows: 1. Improve customer retention and loyalty: improve organizational profitability and change frequent buyers Being loyal customers and partners is a must in CRM. 2. Higher customer profitability: It is obvious that providing the right product at the right time will increase the profitability of each customer and market segment. 3. Create value for the customer: Based on the knowledge we have obtained from the customer and according to his/her characteristics, the company can create value for him/her, thereby retaining him/her for a longer time and meeting his/her specific needs. 2.3.3. The goals of Bayon, Gutsche, Baur Bayon et al. (2002) claim that three factors affect CRM marketing, and organizations should regard the marketing applications provided by CRM as the following goals: 1. Closed-loop marketing: CRM should improve marketing management and planning, with such a comprehensive marketing system that can support planning, event management, execution, Internet support and analysis. 2. Provide better information for better management: implement highly concentrated targeted activities with higher return on marketing investment. Read Less