Page 7 - DMGT308_CUSTOMER_RELATIONSHIP_MANAGEMENT

Customer Relationship Management
Notes
2 LOVELY PROFESSIONAL UNIVERSITY
maintaining, and expanding customer relationships, with special attention paid to the new
possibilities offered by the Internet, mobile devices, and multi-channel interaction. CRM enables
a company to capture a consolidated customer view through multi-channel interactions in a
data warehouse solution.
Sophisticated analytical techniques are then applied to this customer information to better
understand and predict customer behaviour. CRM can then be used to strategically implement
acquired customer knowledge in every area of the company, from the highest management
level to all employees who come into direct contact with customers. CRM thus enables an
organisation to address its customers’ preferences and priorities much more effectively and
efficiently. CRM is a tool that can help organisations to profitably meet the lifetime needs of
customers better than their competitors.
1.1 Definition and Scope of Customer Relationship Management
Customer Relationship Management is a comprehensive approach for creating, maintaining
and expanding customer relationships.
Significance of the words used in the definitions:
(a) Comprehensive: CRM does not belong to just sales or marketing. It is not the sole
responsibility of customer service group or an IT team; i.e. CRM must be a way of doing
business that touches all the areas.
(b) Approach: An approach is broadly a way of treating or dealing with something. CRM is a
way of thinking about and dealing with the customer relationship. We can also use the
word strategy because CRM involves a clear plan. In fact, CRM strategy can usually serve
as a benchmark for other strategies in your organization, because any strategy sets
directions for your organization. We can also consider this from a department or area
level just as a larger organization has strategies for shareholder management, marketing,
etc. Each strategy must support managing customer relationships. Thus CRM is strategic.
To realize this, one can make a list of key strategies, to brief your area of responsibility.
Then write down organizational approach towards customers. Compare the CRM strategies
with other strategies. They should support each other. External customers are those outside
the organization who buy goods and the services the organization sales. Internal customers
is a way of defining another group in some organization whose work depends upon work
of your group. Therefore, they are your customers. It is your responsibility to provide
what they need so that they can do their job properly.
(c) Customer relationship: Finally let us see what we mean by customer relationship. In
today’s world where we do business with individuals or groups with whom we may
never meet and hence much less know in person-to-person sense. CRM is about creating
the feel of comfort in this high tech environment.
CRM is a discipline as well as a set of discrete software and technologies which focuses on
automating and improving the business process associated with managing customer relationships
in the areas of sales, marketing, customer services and support. CRM software applications
facilitate the coordination of multiple business functions (such as sales, marketing, customer
services, and support) and also coordinate multiple channels of communication with the customer
face to face, call centres and the Web – so that organizations can accommodate their customers’
preferred channels of interaction.
CRM (Customer Relationship Management) is a comprehensive strategy and process of acquiring,
retaining and partnering with selective customers to create superior value for the company and