Chapter 11 Building a Customer-Centric Organization – Customer Relationship Management

Chapter 11 Building a Customer-Centric Organization – Customer Relationship Management

Customer relationship management (CRM)

CRM enables an organization to;

•  Provide better customer service
•   Make call centers more efficient
•   Cross sell products more effectively
•   Helps sales staff close deals faster
•   Simplify marketing and sales processes
•   Discover new customers
•  Increase customer revenues

Recency, Frequency, and Monetary Value

An organization can find its most valuable customers by using a formula that industry insiders call FRM;

• How recently a customer purchased items (recency)
• How frequently a customer purchased items (frequency)
• How much a customer speeds on each purchased (monetary value)

The Evolution of CRM

• CRM reporting technologies help organizations identify their customers across other applications. 
• CRM analysis technologies help organizations segment their customers into categories such as best and worst customers. 
• CRM predicting technologies help organizations predict customer behavior, such as which customers are at risk of leaving. 

Using Analytical CRM to Enhance Decisions

• Operational CRM – supports traditional transactional processing for day-to-day front-office operations or systems that deal directly with the customers
• Analytical CRM – supports back-office operations and strategic analysis and includes all system that do not deal directly with the customers

Customer Relationship Management Success Factors

CRM success factors include;

• Clearly communicate the CRM strategy
• Define information needs and flows
• Build an integrated view of the customer
• Implement in iterations
• Scalability for organizational growth