Page 192 - DMGT308_CUSTOMER_RELATIONSHIP_MANAGEMENT

Unit 7: Electronic-CRM

ERP (Enterprise Resource Planning) attempts to bridge the gap between the SCM and CRM Notes
packages by providing a “unified software program divided into software modules that roughly
approximate the old standalone systems” (Koch, 2006). The main focus of ERP systems is data
sharing, data distribution, and data quality in order to avoid duplicate and redundant. Kock
states that the main goals for an organization to undertake ERP:
1. Integrate financial information,
2. Integrate customer order information,
3. Standardize and speed up manufacturing processes,

4. Reduce inventory, and
5. Standardize HR information (Koch, 2006).
When it comes to ERP systems, they can provide many benefits and paybacks for an organization
that chooses to implement the system and does so effectively. An ERP system should be carefully
planning, analyzed, and designed prior to implementation, followed by training and
maintenance. This can be a huge task to undertake for any organization. I think that the differences
in these systems are due to the lack of ability to truly fulfill an organization’s complex needs and
business processes across the various departments and functions.
These systems encompass the main enterprise-wide information systems. These systems feed
into the decision support systems such as data mining and OLAP using data warehouses, marts,
etc. There are additional systems that are more focused on specific business objectives. Some of
these systems include, but is definitely not limited to:

1. Decision Support Systems,
2. Sales Force Management Systems,
3. Executive Information Systems,
4. Strategic Information Systems, and

5. Group Support Systems.

SCM and CRM

SCM (Supply Chain Management) allows organizations to efficiently manage their entire supply
chain from purchasing to distribution and logistics. I think that the main focus of SCM is on
purchasing or transactional data, or internal data. SCM and ERP are often different systems in
many organizations, which make it difficult to “Connect Demand with Supply” as Michael
Schrage’s article discusses. The difficulty will play an important role for technology managers
as the two systems can have contrasting objectives. Schrage offers an example of this:
“There’s no question that you can optimize the efficiency of a supply chain at the cost of being
less responsive to customers.

Example: You might save your firm 25 percent of hard dollar costs if I eliminate some
distribution centres and carry fewer inventories. That decision would probably make your
company less responsive to customers, since they might then experience more stock-outs. But
that trade-off may be worth it. What I pay for that extra inventory may cost more than what I
lose in sales from customers who don’t find the stock they want. The question is: What’s the
better business investment?”
For any business to extract maximum benefit from its CRM deployment, it is important that it
be linked to the back processes. Supply chain management, when connected via business

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