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Customer Relationship Management

Notes Keys for Customer Retention

1. SFA (Sales Force Automation): CRM also incorporates enhanced Sales Force Automation
(SFA) functionality. SFA puts account information directly in the hands of field sales staff,
making them responsible for maintaining it and thus helps them to be more productive.
Now, as part of CRM, SFA is also focused on cultivating customer relationships and
improving customer satisfaction.
2. TQM (Total Quality Management): TQM has been another driving force. TQM is aimed at
improving quality and reducing costs. The TQM philosophy has been prevalent in many
companies, which find it necessary to involve both suppliers and customers for
implementing TQM at all levels of the value chain. Companies like IBM, Motorola, General
Motors, Xerox, Ford and Toyota are consistent users of TQM and hence also of CRM. Other
programs like JIT supply and MRP (Material Resource Planning) have also made for the
use of interdependent relationship between supplier and customer.
3. SSA (Systems Selling Approach): SSA is yet another factor which has become more common
with the advent of digital technology and complex products. The systems selling approach
involves the integration of parts, supplies and the sale of services along with a particular
capital equipment. In the capital goods market, customers appreciate the idea of system
integration. Sellers have been able to sell augmented products and services. This has also
been extended to consumer packaged goods and services sector.
4. KAM (Key Account Management): Another offshoot of CRM has been the development of
Key Account Management Program as some companies insisted upon new purchasing
approaches like national contracts and master purchasing agreements to be adopted by
vendors.

5. SCM (Supply Chain Management): Regarding suppliers’ loyalty, again it has been observed
that it pays more to develop closer relations with a few suppliers than to deal with more
vendors. More often marketers find it beneficial to retain existing customers for life rather
than making a one-time sale to several new customers.
6. GAMP (Global Account Management Programs): An extension of CRM is reflected in the
emerging tend of large internationally oriented companies to become global. For this
purpose, such companies are seeking the assistance of vendor’s co-operating and
collaborating solutions for global operations. This has made it obligatory for markets
interested in the business of global companies, to adopt CRM programs, particularly
global account management programs.
7. KM (Knowledge Management): Knowledge about customers is a pre-requisite for CRM.
Indeed, in depth knowledge of the customer’s habits, desires, needs and the analysis of
their cognitive effective behaviour and attributes need to be applied through CRM to
develop and design marketing strategies as well as to develop ad cultivate interaction and
relationship with customers for mutual benefit.
Finally, it is recognizable that customers’ expectations have changed significantly in recent
years. With the advent of new technology and increased availability of new and advanced
product features and services, consumers are least prepared to compromise their preferences for
quality of products/services. Cross selling and up selling are possible to a greater extent for
customers, if they are loyal and committed to the firm and its offerings.

Customer Loyalty

Building customer loyalty is the basic platform of relationship formation. In a highly competitive
and challenging business environment, organisations are really blessed if they are fortunate to

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