Customer relationship management





The stated purpose of customer relationship management (CRM) is to enable a
company to better serve its customers through the introduction of reliable
service automated processes, personal information gathering and processing,
and self-service. It attempts to integrate and automate the various customer
serving processes within a company.

It typically involves three general areas of business. They are a customer
service system, a marketing information system and a sales force management
system. The marketing information part provides information about the
business environment, including competitors, industry trends, and
macroenviromental variables. The sales force management part automates some
of the company's sales and sales force management functions. If keeps track
of customer preferences, buying habits, and demographics, and also sales
staff performance. The customer service part automates some service
requests, complaints, product returns, and information requests.

Integrated CRM software is often also known as "front office solutions."
This is because they deal directly with the customer.

Many call centers use CRM software to store all of their customer's details
on. When a customer calls, the system can be used to retrieve and store
information relevant to the customer. By serving the customer quickly and
efficiently, and also keeping all information on a customer in one place, a
company aims to make cost savings, and also encourage new customers.

CRM solutions can also be used to allow customers to perform their own
service via a variety of communication channels. For example, you might be
able to check your bank balance via your WAP phone without ever having to
talk to a person, saving money for the company, and saving you time.

Improving customer service

CRMs are claimed to improve customer service. Proponents say they can
improve customer service by facilitating communication in several ways:

   * Provide product information, product use information, and technical
     assistance on web sites that are accessible 24 / 7
   * Help to identify potential problems quickly, before they occur
   * Provide a user-friendly mechanism for registering customer complaints
     (complaints that are not registered with the company cannot be
     resolved, and are a major source of customer dissatisfaction)
   * Provide a fast mechanism for handing problems and complaints
     (complaints that are resolved quickly can increase customer
     satisfaction)
   * Provide a fast mechanism for correcting service deficiencies (correct
     the problem before other customers experience the same dissatisfaction)
   * Identify how each individual customer defines quality, and then design
     a service strategy for each customer based on these individual
     requirements and expectations
   * use internet cookies to track customer interests and personalize
     product offerings accordingly
   * use the internet to engage in collaborative customization or real-time
     customization
   * Provide a fast mechanism for managing and scheduling followup sales
     calls to assess post-purchase cognitive dissonance, repurchase
     probabilities, repurchase times, and repurchase frequencies
   * Provide a fast mechanism for managing and scheduling maintenance,
     repair, and on-going support (improve efficiency and effectiveness)
   * Provide a mechanism to track all points of contact between a customer
     and the company, and do it in an integrated way so that all sources and
     types of contact are included, and all users of the system see the same
     view of the customer (reduces confusion)
   * The CRM can be integrated into other cross-functional systems and
     thereby provide accounting and production information to customers when
     they want it

Improving customer relationships

CRMs are also claimed to be able to improve customer relationships .
Proponents say this can be done by:

   * CRM technology can track customer interests, needs, and buying habits
     as they progress through their life cycles, and tailor the marketing
     effort accordingly. This way customers get exactly what they want as
     they change.
   * The technology can track customer product use as the product progresses
     through its life cycle, and tailor the service strategy accordingly.
     This way customers get what they need as the product ages.
   * In industrial markets, the technology can be used to micro-segment the
     buying centre and help co-ordinate the conflicting and changing
     purchase criteria of its members
   * When any of the technology driven improvements in customer service
     (mentioned above) contribute to long-term customer satisfaction, they
     can ensure repeat purchases, improve customer relationships, increase
     customer loyalty, decrease customer turnover, decrease marketing costs
     (associated with customer acquisition and customer ÒtrainingÓ),
     increase sales revenue, and thereby increase profit margins

Technical functionality

A CRM solution is characterised by the following functionality:

   * scalability - the ability to be used on a large scale, and to be
     reliably expanded to what ever scale is necessary.
   * multiple communication channels - the ability to interface with users
     via many different devices (phone, WAP, internet, etc)
   * workflow - the ability to automatically route work through the system
     to different people based on a set of rules.
   * database - the centralised storage (in a data warehouse) of all
     information relevant to customer interaction
   * customer privacy considerations, e.g. data encryption and the
     destruction of records to ensure that they are not stolen or abused.

Privacy and ethical concerns

CRMs are not however considered universally good - some feel it invades
customer privacy and enable coercive sales techniques due to the information
companies now have on customers - see persuasion technology. However, CRM
does not necessarily imply gathering new data, it can be used merely to make
"better use" of data the corporation already has. But in most cases they are
used to collect new data.

Some argue that the most basic privacy concern is the centralised database
itself, and that CRMs built this way are inherently privacy-invasive. See
the commercial version of the debate over the carceral state, e.g. Total
Information Awareness program of the United States federal government.

The use of computer cookies is troubling for many people. This is particularly
true when the customer is unaware that their web usage is being tracked.

CRM suppliers

Siebel Systems has been among the most active and outspoken in its appeal to
the U. S. federal government's homeland security plans. Shortly after Sept.
11, the company created a homeland security business unit, which now employs
100 people, and announced it would build a set of applications geared
specifically for homeland security.

Many other companies supply CRM solutions, including Oracle Corporation,
IBM, FrontRange Solutions, BroadVision and Epicor. These pay varying degrees
of attention to usability, integration, and privacy concerns - it being
widely acknowledged as impossible to fulfil all three constraints - thus it
seemed unlikely that any one vendor can dominate in the near term. However,
those dealing in Total Information Awareness and fulfilling government
contracts to gather data on citizens without their permission or knowledge,
clearly have the advantage of prepaid integration contracts and no privacy
limits whatsoever, effectively making CRM a key part of the U.S.
military-industrial complex.

If a dominant provider of such "solutions" could gain a decisive advantage
in this privacy-sensitive marketplace, this would raise significant
antitrust concerns.