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Customer Relationship ManagementWagner & Zubey (2007) 11Copyright (c) 2006 Prentice-Hall. All rights reserved.

Copyright 2007 Thomson Publishing: All Rights Reserved

Chapter 1: Basics of CRM

Essentials of Customer Relationship Management:

A People, Process, and Technology Approach

William Wagner and Michael Zubey

Customer Relationship ManagementWagner & Zubey (2007) 2

Objectives

Define and understand Customer Relationship Management (CRM)

Define CRM and place it in a historical context

Describe how CRM benefits organizationsOutline the major CRM processesDescribe the IT framework for CRM


Objectives (cont.)

Identify databases involved in CRM applications

Describe CRM's relationship to ERP applications

Outline possible future directions for CRM


CRM in Action

CRM at Huntington BankPersonal banking vs. mortgage banking2 months for long-term client to get approval for

mortgageAll of the information is already there360 degree view of customerCRM should provide better service and cut costs

at the same timeMay lead to other value-added services also


CRM Defined

Customer Relationship Management (CRM) is the systematic combination of people, processes and technology that is designed to enable an enterprise to find, acquire, and retain customers. (Wagner & Zubey)


Why firms invest in CRM…

Cost of acquiring customersEx. Of AOL giveawaysGenerally costs 5X as much to attract new

customers as it does to keep existing onesReducing customer churn rate 5% can increase

profits 25-95%Satisfied customers are great source of improved

ROI Number 1 reason for customer defections is poor

customer service


Benefits of CRM

Reducing the cost of sales Identifying and targeting customers better. Decreasing cost of marketing campaigns Increasing customer loyalty Increasing customer retention Identifying customer trends and patterns of

consumption Help the right information flow to wherever it's

needed throughout the organization.


CRM and People

Roles of ExecutivesCEO, CMO, CFO, CIO, VP of Sales

Operational level RolesMarketing manager, customer service, sales

person, IT manager, Database administrator


CRM Processes

Marketing Sales Customer Service


CRM and the Marketing Process

Focused on lead generation and awareness of the products and services being offered by a firm


CRM and the Sales Process

sales process can be very different based upon locality and type industrysome firms may have multiple sales channels

includes web, direct sales, or distributors to sell their products and services in the market

A multi-channel sales model is a very challenging effort to coordinate from a CRM perspective.


CRM and Customer Support Process

The customer support process is often overlooked customer support is not perceived as a revenue

generating activitymay not receive the same amount of investment

as a sales process because of the “cost center” perception by a firm’s management.


CRM Technology Framework

One of several “enterprise” applicationsThink in terms of infrastructure necessaryAlso in terms of CRM applications


Infrastructure for CRM

Hardware Input/Output devices, servers, cables, channels

Software Applications OS, NOS “Middleware”

Networks LAN, WAN C/S main architecture

Inet is considered to be an example of C/S


CRM and Client/Server


N-Tier Client/Server


CRM and Software

Common OS and H/W configurations define an IT “platform”

Databases Database servers DBMS software Relational DBMS

Structured Query Language (SQL) “legacy” databases Text database - XML Operational and analytic databases


CRM Applications

Sales Force AutomationCall or Service Center IntegrationMarket automation


Major CRM Software Vendors

Oracle/Seibel/PeopleSoft SAP Onyx Baan/Invensys Vantive Clarify Salesforce.com


Summary

In this chapter you learned: Basics of CRM

Using a people, process technology approach Importance for businesses today

Core processes involved in CRM Roles of people involved in CRM Key technologies that support CRM Future directions of CRM


Questions?

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