Download Data warehouse: the critical link between operations and marketing

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SAS Institute
Data Warehouse:
The Critical Link between
Marketing, Customer Care
and Internal Processes
Dr. Ronald U. Telson
SAS Institute Europe
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SAS Institute
Evolution to
Relationship Marketing
Consumer Marketing
Industrial Marketing
Non-profit & Societal Marketing
Services Marketing
Relationship Marketing
Transaction vs. Relationship
Marketing
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SAS Institute
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Transaction marketing
 Focus on single sale
 Orientation on product features
 Short time-scale
 Little emphasis on customer
service
 Limited customer commitment
 Moderate customer contact
 Quality is primarily a concern of
production

Relationship Marketing
 Focus on customer retention
 Orientation on product
benefits
 Long time-scale
 High customer service
emphasis
 High customer commitment
 High customer contact
 Quality is the concern of all
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SAS Institute
Managing Relationships between the
Organization and its Customers
Customers needs
and Competitors’
performance should
be the key
determinants of
Customer Care
levels
Customer
Care
Marketing
Customers should
be the final arbiters
of process design
Process
Management
Managing by Process should include both the process element
(i.e. designing out failure points) and the data element (i.e.
end-to-end measurement of defects, cycle time and failures)
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SAS Institute
1993: US RBOCS Customer
Retention Challenge
100%
30%
80%
53%
91%
40%
70%
47%
20%
9%
Scenario
1
60%
Scenario
2
Competitor
Scenario
3
0%
Scenario 1:
Competition offers
higher prices, lower
service quality, less
features
Scenario 2:
Competition offers lower
prices, lower service
quality, less features
Scenario 3:
Competition offers lower
prices, higher service
quality and more
features
Monopoly
Source: US WEST
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SAS Institute
Data Warehouse Applications in
Customer Care

Customer Analysis
 Customer Profiling
 Customer Segmentation
 Target Marketing
 Lead Generation
 Customer Retention
 Win Back
 House Holding
Customer Churn in US Carrier
Market (1995)
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SAS Institute
30,00
Percent
25,00
20,00
Once
15,00
Twice
3 or More
10,00
5,00
0,00
AT&T
MCI
Long Distance Carrier
Sprint
Source: FCC
There is nothing magic about retaining customers
Profit Stream of
Customer Retention
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SAS Institute
Profit Income Increase (%) for a 5% Incease in Retention
140.00%
Percent Profit Income
120.00%
100.00%
80.00%
60.00%
40.00%
20.00%
0.00%
Mail Order
Auto Service
Chain
Software
Insurance
Brokerage
Credit Card
Industry
Source: Harvard Business School
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SAS Institute
Responding to the Service Quality
Challenge

Establish a Service Quality Program
 Understand the Voice of the Customer, that is the customerbased definition of service
 Identify the key service factors
 Develop Q[uality] measures
Voice of the Customer
(US West)
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SAS Institute
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




Reliability
 Accurate Billing
 Keep good records
 Do what you said you would when you said you would do it
Responsiveness
 Let me know what” happening
 Call me back quickly
 Keep your appointments
Competence
Access
 Don”t keep me waiting
Know me and Understand me
If it Fails, Fix it Fast
 Restore Service First, Play later
Monitor and Manage the
Corporation’s Performance
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SAS Institute

Establish a Process Performance Program
Monitor the process outputs (Q measures)
Reduce variability
Understand root causes of process failures
Continuously improve the process
U S WEST
Communications, circa 1993
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SAS Institute
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1992 Revenue: » $ 11 billion
» 25 m customers across 14 US states
 Residential
 Small Business
 Large Business & Government
 Inter Exchange and Local Exchange Carriers
» 61,000 Employees
1,754 Electronic Switching Systems
» 45 million miles of fibre/copper lines
400+ Operation Support Systems; 39 Mainframes
US West Business
Process Model
Billing
CQ5
CQ1, CQ2, CQ3, CQ4
Service
Delivery
(MM)
Service
Delivery
(BGS,
CXR)
Customer Agents
Foundation
CUSTOMER
CQ1, CQ2, CQ3, CQ4
Finance
Human Resources
Processes
Technologies
Total Quality
Service
Assurance
MPQ5
Supplier
SAQ1, SAQ2, SAQ5
CPQ1, CPQ2, CPQ5
Marketing
& Planning
Capacity
Provisioning
BUSINESS
UNITS
Implementers
LNOQ1, LNOQ2, LNOQ5
SAQ1, SAQ2, SAQ5
LNOQ1, LNOQ2, LNOQ5
CORE PROCESS AREAS
Procurement
Legal
Public Policy
Public Relations
Regulatory
Support
SAS Institute
Field
Forces
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Transformation Metrics
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SAS Institute
Phase 1
Who is calling the Business Offices and why
 length in queue, number of busies, abandon, etc.
 What is our daily forecast of Work Force
 how many technicians and where should they be when
 What are our missed commitments characteristics
 by New Services Request, Repair Requests, by customer
 number of customers
 average duration
 reason
 What are our daily switched call characteristics
 total volume, whom from, whom to (by customer segment)
 defects per million
 What are our daily transport characteristics
 fibre and copper transport failure MTTR, MTBF
occupancy rate and overflow

PANS: Three - Tier Data Warehouse Systems
WFA
OSSs
MTAS/MIHR
...
NMA
Switche
s
...
SAS System Data Access Engines
Host
Environment
1.2 G
daily
T
Transformation Engine
H
E
Data Warehouse
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A
S
Physical Data
Logical Data Views
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Y
S
T
E
Business Offices VRUs M
OLTP
Systems
Application
Layer
Compute Serving
DSS
ODBC
Driver
Visualization OLAP
OO Applications
Development Tools
Presentation
Layer
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SAS Telecom Package
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Our Solutions

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Customer Analysis

Customer Profiling & Segmentation

Target Marketing/Lead Generation

Customer Retention & Win Back

House Holding
Product/Promotion Analysis

Product Profitability

Promotion Campaign Mgmt

Product Churn

Product Affinity

Product Adoption Rates
Network utilisation Analysis

Customer Usage by Location

Excess Capacity Analysis
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Fraud Detection
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Life Cycle Value
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Proof Positive
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The SAS solutions will help your
organisation bring about an alignment
between Marketing,
Customer Care and Process Management
so that the impact on the customer
is more effective
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Merci!