Page 255 - DMGT308_CUSTOMER_RELATIONSHIP_MANAGEMENT

Customer Relationship Management

Notes Measure Satisfaction with CRM

Measuring CRM success has often been elusive, but it is possible to measure satisfaction with
CRM. Companies have often measured success either by ROI or by changes in customer
satisfaction to justify CRM benefits. Although capturing ROI and preventing CRM budget
expansion is important, the CRM magazine/A.T. Kearney research indicates that 60 percent of
companies claim their CRM initiatives met or exceeded expectations. Of the rest, 25 percent did
not set expectations. So for the moment, there appears to be more satisfaction with CRM projects
than not. However, ROI generally measures the internal return of a technology/process or
organization improvement project.

Task How will you measure customer’s satisfaction?

Self Assessment

Fill in the blanks:
1. There are …………………… stages in a CRM strategy.
2. The …………………… is to define the objectives to be met and the tactics to be used.

3. The first stage in developing the CRM strategy is to …………………… into categories.
4. By establishing objectives, one can determine retention targets that meet ……………………
goals.

5. Being customer centric is a part of …………………….

10.2 Customer System Life Cycle

CRM has its roots in Relationship Marketing, which is “an over attempt of exchange partners to
build a long-term association, characterized by purposeful cooperation and mutual dependence
on the development of social as well as structural bonds” (Pulde, 1999). Light (2003) stated that
CRM evolved from business processes such as relationship marketing and the increased emphasis
on improved customer retention through the effective management of customer relationships.
A CRM system can be viewed as an enterprise information system that includes all business
processes in sales, marketing, and after-sale service that involve the customer. Levine (2000)
points out that CRM systems use customer-related information or knowledge to deliver relevant
products or services to the company’s customers.
One of the most significant definitions of a CRM system has been given by Davenport et al.
(2001), stating that CRM systems are “all the tools, technologies and procedures to manage,
improve or facilitate sales, support and related interactions with customers, prospects, and
business partners throughout the enterprise”. In the same way, Parvatiyar & Sheth (2002) speak
of CRM systems as “a comprehensive strategy and process of acquiring, retaining, and partnering
with selective customers to create superior value for the company and the customer.
It involves the integration of marketing, sales, customer service, and the supply-chain functions
of the organization to achieve greater efficiencies and effectiveness in delivering customer
value.”
The research area of CRM systems is wide, and in the last years the academic interest has
produced significant results in particular domains. In this way, some authors have explored and

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