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Customer Relationship Management

Notes Many approaches to CSR pit businesses against society, emphasizing the costs and limitations of
compliance with externally imposed social and environmental standards. CSV acknowledges
tradeoffs between short-term profitability and social or environmental goals, but focuses more
on the opportunities for competitive advantage from building a social value proposition into
corporate strategy.
Ecological Accounting Challenges

A significant challenge of CSV resides in accounting for ecological values and costs that are
generated within the realm of agricultural production. Up to 90% of the ecological footprint in
food processing can be attributed to land management activities outside the control of
corporations. An eco commerce model that accounts for ecosystem services at the production
unit (farm) level allows “shared value” to emanate from the production unit outward. Centring
the shared value at the farm level allows for utilities, biomass processors, food processors,
environmental liability insurers, landlords, and governments to participate in the shared value
process. This Eco commerce shared value process accounts for and includes positive
[environmental] externalities within the economic system.
Comparison with Corporate Social Responsibility

Corporate social responsibility (CSR) differs from Creating Shared Value, although they share
the same ground of “doing well by doing well”. Mark Kramer, the co-writer of Harvard Business
Review article on Creating Shared Value, states in his “Creating Shared Value” blog that the
major difference is CSR is about responsibility, whereas CSV is about creating value. Whether it
is an extended “new form of CSR” or “shared value”, CSV is fundamentally different from the
CSR activities of the past.
Rather, CSV is a transition and expansion from the concept of CSR. Business responsibility has
evolved from Traditional CSR 1.0 (Stages: Defensive, Charitable, Promotional and Strategic),
Transformative CSR 2.0 and to CSR 3.0 what is similar to CSV. Such development of stages by
redefining CSR has laid theoretical foundations for companies and society to sustainably and
communally overcome societal issues. As capitalism matures, it is companies’ duties to break
itself out of the traditional CSR by realizing its limitations and try to restructure and pursue new
market strategies that value both economic and societal development.

CSV concept supersedes CSR for it is a way for corporations to sustain in the competitive
capitalistic market. Whereas CSR focuses on reputation with placing value in doing well by
societal pressure, it generates both economic and societal benefits relative to cost in real
competition of maximizing the profits. Instead of being pushed by external factors, CSV is
internally generated not confined to financial budget as CSR is. With the advent of CSV and
following strong worldwide advocacy for it, companies started to overthink about their vision
for their sustainable growth.
From a customer’s perspective, customer value is what they “get” (benefits) relative to what
they have to “give up” (costs or sacrifices) (Zeithaml 1988). The creation of customer value has
long been recognized as a central concept in marketing (Woodruff 1997) and the fundamental
basis for all marketing activity (Holbrook 1994). It has been suggested as the purpose of
organizations (Slater 1997), a main key to success via differential positioning (Cooper 2001), and
a precursor to customer satisfaction and loyalty (Woodall 2003). The call for more attention to
this concept by Hunt (1999) has been answered recently with more work within this area. One of
the critical parts of customer value research is the design of frameworks and typologies to help
firms better understand value creation. Although there have been recent attempts to develop
these typologies (e.g., Holbrook 2005; Ulaga 2003; Woodall 2003), there is little consistency in

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