Survey
* Your assessment is very important for improving the workof artificial intelligence, which forms the content of this project
* Your assessment is very important for improving the workof artificial intelligence, which forms the content of this project
Int. j. econ. manag. soc. sci., Vol(3), No (4), April, 2014. pp. 222-227 TI Journals International Journal of Economy, Management and Social Sciences www.tijournals.com ISSN: 2306-7276 Copyright © 2014. All rights reserved for TI Journals. Review and application of theoretical models of customer relationship management on organizational productivity Hadi Nuri Master of Business Administration student at Islamic Azad University of Kermanshah, Iran. Zahra Khoshiman * Master of Marketing Management, Islamic Azad University Kermanshah, Iran. *Corresponding author: [email protected] Keywords Abstract theoretical model customer relationship management metrics for evaluation conceptual design This article aims to review and apply theoretical models of customer relationship management on the organizational productivity. The purpose of this paper is to examine the concept of customer relationship management, objectives, and the customer relationship management models and systems. The method is documentary – analytical and print and electronic resources are implemented. There are also three categories of customer relationship management systems; including operational, analytical, and interactive. Among the customer relationship management goals we could point to increasing revenue, creating customer loyalty, and reducing costs and the customer relationship management, Gartner model, Wendy Close model, GL model, M.POLO model are among theoretical ones and the most important factors in productivity include competitive advantage, identifying and monitoring the measures of success and customer data. The concept of customer relationship management Different definitions of customer relationship management have been provided by the experts, which are addressed briefly below: Abbasi, quoted Burnt (2001), writes: the customer relationship management is a part of organization strategy to identify and satisfy the customers and change them into permanent ones. It also helps in managing the customer relationship with company and maximizing the value of every customer (Abbasi, 1389, page 21). He also notes: customer relationship management is a collection of methodologies, processes, softwares and systems assisting to companies and departments due to the customer relationship effective and organized management (Abbasi, 1389, page 30). Elsewhere, the customer relationship management is in fact a process to collect and integrate data for efficient and objective operation. This information can be useful in having relationship with customers, sales, effective marketing, sensitivity and market needs (Elahi, 1384, page 21). In another definition, customer relationship management means to establish and maintain personal relationships with profitable customers through the appropriate use of information and communication technology (Kavoussi, 1384, page 389). Customer Relationship Management is comprised of three main parts: customer, relationship, management. Customer means the end consumer which plays a critical role in valuable relationships. With relationship we mean creating more loyal and effective customers through learning relationship and management includes creativity and directing a customer-center business process and considering the customer at the center of organization processes and experiments (Elahi, 1384, page 3). Customer relationship management is a business strategy which could be enhanced by improving technology and then the companies seek to establish effective relationships based on optimizing the customer's cognitive and comprehensive value (Safari Nejad, 1387, page 63). Kamalian et.al, quoted Anton (2002), write: customer relationship management is a comprehensive business and marketing strategy which integrates processes technology and all customer's property business activities (Kamalian et.al, 1388, page 25). Sufi, quoted Adrienne (2005), writes: customer relationship management is a strategic approach about improving the beneficiary value through developing the proper relationships with customers and key customer segments (Sufi , 1389, page 4). Thus, according to the above definitions, we can say that customer relationship management is the collection of strategies, methodologies, processes, software and systems that help institutions and companies in effective and organized customer relationship management. Customer relationship management objectives Various insights on customer relationship management have been proposed by experts, which are paid briefly below: Najafi, quoted Brent (2001), writes: customer relationship management objectives can generally be divided into three groups "costs saving, increase revenue increase, and strategic effects". He admits that the following objectives seem reasonable for the organization running customer relationship management: recovery rate, increasing profits, increasing customer satisfaction, reducing administrative costs, marketing and public Sale costs (Najafi, 1391, page 90). Kabiri, quoted Noel (2009), writes: total customer relationship management involves identifying the things that have created value for the customers and then delivering them in this view. While consumers have different attitudes towards value, many methods are available to satisfy any of them. Then, customer Relationship Management objectives include: identifying the specific values of each segment of customers, understanding the needs relative importance for each customer segment, determining whether providing such positive manners will be effective or not, communicating and presenting values appropriate to each customer in a manner that they wish to receive information, measuring results and demonstrating the investment return (Kabiri, 1376, page 94). Najafi, quoted Swift, writes: customer relationship management has continuous learning process in which information about each customer is converted to establishing relationship with them and it is not enough just to have information about each customer but the individual needs should be collected and analyzed and be answered appropriately. He also states that the purpose of customer relationship management is to increase business opportunities through: improving easy relationship with customers, providing the right products to each customer, offering the right products through the right channels to each customer, offering the right products at the right time to each customer (Najafi, 1391, page 100). Atibaei, quoted Asatmn (2002), writes: since customer is the organization's life pulse, CRM main objective is based on attracting and retaining customers. The basic idea of customer relationship management helps the organizations on using technology and human resources due to gain better insight toward customer business behaviors and the values of each customer for the organization. Some comprehensive customer relationship management objectives include: managing and organizing the relationship between organization and customers, making the customers' needs accountability easy and fast and providing services, reducing the customer's needs accountability time and costs, attracting new customers, retaining old customers and making them satisfied, reducing the sales cost, distribution and marketing, boosting sales, increasing organization profits and income, taking advantage against other competitors in attracting market positions, providing more effective byproducts, predicting sales, market and customers future needs, increasing the work efficiency, and making sales cycle shorter (Atibaei, 1386, page 63). Therefore, considering the above arguments, we can say customer relationship management objectives are consisted of increasing revenue including identifying new opportunity and reducing missed opportunities, creating customer loyalty through improving customers' services and organization sight, reducing information storage costs and reducing administrative costs, marketing and public and sales costs. 223 Review and application of theoretical models of customer relationship management on organizational productivity International Journal of Economy, Management and Social Sciences Vol(3), No (4), April, 2014. Customer relationship management systems In customer relationship management, these systems can be divided into three general categories: 1. Operational CRM: In this method, all stages of the customer relationship from marketing and sales to post-sales services and the customer feedback, are given to one person; Of course, in such a way that the salespeople and engineers can get the history of each customer's information without referring to him/her. Among the means and methods of operational CRM, automate sales force systems can be noted that are responsible for all operations related to contact management, stock and sales management. Operational part of CRM typically involves three general areas of sales operations automation, support and customer service and marketing operations automation. Marketing segment provides information about competitors, market trends, and environmental macro variables. Marketing segment automates some sales processes and company sales management and seeks to collect information about certain buying habits, tastes, and customers demographic and sales staff efficiency. Customer service segment automates some services such as information requests, complaints and returned products (Chang, 2001, page 23). 2. Analytical CRM: in analytical CRM, means and methods used analyze the information obtained from CRM and prepare the results for business operation management. In fact, operational and analytical CRM have a two-way interaction; that is the operational data are submitted to analytical section. After analyzing data, the results directly affect operational section. Through analysis in this section, customers are classified and this allows organizations to focus on a particular segment of customers (Chang, 2001, page 23). 3. Interactive CRM: In this type of relationship, the customer can communicate with organization by the easiest way possible like telephone, mobile, fax, internet and other desired methods. Because the customers could choose the method and most processes are submitted to the related authority in the shortest possible time, Interactive CRM causes the customers to revisit and continue their relationship with the company (Chang, 2,001th the page. 24). Considering the above arguments we can say: operational CRM involve all stages of customer relationship, marketing, sales and post-sales services. In interactive CRM a communication is formed between the customer and the organization. Theoretical models for the customer relationship management 1. Customer relationship management is considered as innovative design in organizations and investigating this in service organizations is a priority. According to the customer relationship management concepts, we can find that customers, employees, leadership, organizational culture, strategy and structure are the main factors for CRM implementation and therefore the following theoretical model, consisting three intellectual, social, and information technology could be design and explained. The theoretical model for customer relationship management implementation Intellectual dimension Social dimension IT Strategy Interaction with stakeholders Electronic Markets Applications Business Models Organizational Culture Scope of work The plan structure Customer Leadership IT capacity Knowledge Management Staff Figure 1.1: Adapted from article (Abbasi, 1389, page 26) Based on the proposed model, the research original dimensions for organizations' customer relationship management include: intellectual dimension, social dimension, and information technology (Abbasi, 1389, page 26). 2. In Gartner conceptual model, according to figure 1.2, the vision is defined first. Then, strategies to achieve the vision are identified. Next, the needs of customers, the partnership structure and the organization culture such as synchronization with the system are mentioned. After that, the knowledge management processes such as customer relationship management are mentioned. Next, the data and their analysis are presented and in later stages the IT infrastructure performance evaluation measures are discussed. Hadi Nuri, Zahra Khoshiman * 224 International Journal of Economy, Management and Social Sciences Vol(3), No (4), April, 2014. 1. CRM vision 2. Strategy: objectives, sectors, effective interactions 3. Customers analysis: 4. Organizational Identifying needs, corporation: monitoring expectations Culture and customer Satisfaction against the perception-based structure competition based Collaborate and feedback Strong relationships Staff Partners 5. Processes: customer life cycle, knowledge management 6. Information: data and their analysis 7. Technology: Applications, Architecture and Infrastructure 8. Measures: satisfaction, retention, loyalty and ... Figure 1.2: Gartner models derived from article (Mousavi Madani, 1390, page 61) 3. In Wendy Close conceptual model ( 2002), in accordance with Figure 1.3, CRM perspective that is the ultimate goal of CRM design and implementation is defined first. Secondly, CRM strategy and in other words the way to get vision defined in the previous step, is noted. Then, the customers' valuable experiences are mentioned, and it is necessary to place the organization partnership due to achieve objectives in the next vision. In the fifth step, define and automate CRM processes are performed. In the sixth step, useful data and necessary information relating to customers should be withdrawn. In the seventh step, CRM IT infrastructures will be created. Finally, in the last step, CRM monitoring and tracking metrics are defined (Mousavi Madani, 1390, page 62). 225 Review and application of theoretical models of customer relationship management on organizational productivity International Journal of Economy, Management and Social Sciences Vol(3), No (4), April, 2014. CRM outlook Strategies Identifying customer needs Cooperation Processes Definition Customer data Technology Identifying and monitoring track success measures Figure 1.3: Wendy Close model, derived from the article (Mousavi Madani, 1390, page 63) 4. In GL conceptual model (2003), according to Figure 1.4, the desired strategic outcomes are defined first. Secondly, processes and activities necessary to achieve the strategic objectives are identified. However, human fixed capitals are considered independent of the technology. Strategic Results Customer Results Mission and Business Results Value Processes and Activities Value Other fixed assets Technology Human Capital Input Figure 1.4: GL model (2003), Derived from article (Saniei Monfared, 1390, page 66). 5. In M.Polo model (2002), according to figure 1.5, we first address the strategies include improving quality and increasing loyalty, members pre-defined management such as services and processes and insights, analytical models dealing with life-cycle based on the needs and satisfaction and retention and receiving answer, organizational changes like business and relationship marketing alignment, technology platform that is sales automation and data analysis, development and education like sales and service training and continuous learning processes. Finally, strategic decisions regarding product development and the balance between supply and demand channels and the performance quality control are supported by administrative staff. Hadi Nuri, Zahra Khoshiman * 226 International Journal of Economy, Management and Social Sciences Vol(3), No (4), April, 2014. Analyzing Members Strategic models profile Concepts management Organization Business Technology al changes processes Performance Strategic Development Metrics decisions and Training support Figure 1.5: M.Polo model (2002), derived from article (Alvandi, 1388, page 64) The proposed model Regarding the models investigated in this article, the customer relationship management system would involve five hierarchical components in which each component indicates the next one. These five stages are: CRM Vision, strategies and guidelines, processes definition, technologies identification, performance evaluation metrics, which are used in most organizations to increase efficiency and productivity. This model is shown in Figure 1.6. Vision Strategies and guidelines Processes Definition Technologies identification Performance Evaluation Metrics Figure 1.6: The proposed model Implementing CRM models in organizational productivity Today, due to growth and survival in today's in economic competitive arena, companies and organizations must give importance to customers and increase their relationship with customers more than before. Attracting and retaining the customers and understanding their needs are considered as the most important corporate strategy. Many successful organizations have emphasized that there is a relationship between customer satisfaction and organizational productivity. In Gartner model (2001), visions, customer life cycle, technologies, and identifying the customer needs cause customers retention and thus affect the organizational productivity and create competitive advantage. In Wendy Close model (2002), visions, strategies, customer data and information, technologies, identifying and monitoring success track measures dramatically affect the organization performance and efficiency. In GL model (2003), Organization inputs such as human capitals, fixed assets, values, processes and activities, strategies results leave significant effect on organizational performance. In theoretical model of implementing customer relationship management (1389), the social dimension including interaction with stakeholders, customers and employees and technological dimension involving information and applications and knowledge management refers to the organizational capacity which in directly related to achieving the competitive advantage on organizational performance. In M.Polo model (2006), strategic concepts regarding costs reduction, customers attraction, customer loyalty and retention increase, revenue recognition, and certain members management, analysis models, technology, business process, organizational changes that address intensive marketing communications and customer segmentation management, development and training, and product development all contribute to customer satisfaction and thus productivity of the organization. Thus, according to the model proposed, it can be said that Wendy Close is the best model which considers CRM as the most important competitive advantage and introduces success measures monitoring as dramatically affective on organization performance and productivity. 227 Review and application of theoretical models of customer relationship management on organizational productivity International Journal of Economy, Management and Social Sciences Vol(3), No (4), April, 2014. Conclusions In this article, we review theoretical models of customer relationship management and it's usage in organization efficiency. In the present competitive environment, organizations need to maintain their valuable customers due to keep competition. CRM is a method that can be used to achieve customer loyalty and currently has provided any kind of customer service. Customer relationship management includes a series of strategies, methodologies, processes, software and systems, which helps institutions and companies in organized and effective management. The customer relationship management objectives involve: increasing revenue including identifying new opportunities and reduceing missed opportunities, creating customers loyalty including improved customer service and improved organization sight, reducing costs including the information storage costs, and reducing administrative, marketing, public and sales costs. Types of CRM systems include: operational CRM which covers all stages of having relationship with customers from sales to post-sales service; analytical CRM which analyzes operational methods and submits the results due to a better customer relationship; and interactive CRM which includes establishing relationship with customer via fax, mail and the Internet. Among models, the theoretical model of implementing customer relationship management, Gartner model, Wendy Close model, GL model, and M.Polo model were addressed. Finally, the proposed model introduced a new simple and efficient model for Customer Relationship Management. Wendy Close model could be used for organizational productivity. This model of customer relationship management identifies the competitive advantage and monitoring success measures as the most important factors on organization performance and efficiency. References Alvandi, M. (1388) Comparative study of customers’ contact management in 3 Iranian banks with a SWIFT approach, Journal of Development and Revolution Management, Tehran [Iran]. pp. 50. Atibaei, M. (1390) Investigating the management of electronically contact to customers in Iranian banks and its impact on customers satisfaction. M.A Thesis. IAU Kermanshah branch. Elahi, Sh. (1384) Management of customers’ contact, Tehran [Iran]. Kamalian A. R., Amini Lari M., Moezi H. (1390) Investigating the factors of electronically customers contact management on customers’ satisfaction, ScientificResearch Journal Vol 22, pp. 25-32 Kavousi, M. R. (1384) Measurement methods of customers’ satisfaction. Tehran [Iran]. Mosavi Madani F. (1390) Investigating a new model for designing the customers’ contact management. Journal of tomorrow management, No 17, Vol 5, pp. 6364. Najafi M. J. (1391) Investigation of customers’ contact management based on new marketing metrics and productivity in Ilam petroleum, M.A. Thesis, IAU Kermanshah branch. Safarinejad, M. (1387) A look at models of evaluating the customer satisfaction, Tehran [Iran]. Saniei Monfared M. A (1390) Development of a conceptual model for designing customers’ contact management. Scientific-Research Journal, Vol 17, Tehran, pp. 61-65. Soufi, Jahanyar, Karimi, S. (1389) Evaluation of performance of CRM in IKCO, Journal of Behbood and Tahavol management, Vol 61, Tehran, pp. 167-191 Yang book byun (2001), “customer relationship management”, university of California, available at:www.crito.uci.edu,[07, 08, 2004].