Abstract

Background

What is CRM?

Integration of Front and Back Office Systems

Integration of CRM Strategies with the Internet

Practical Examples of CRM Strategies on the Internet

Conclusion

References
 

 
Many organisations have already optimised the Back Office to the point where there is very little additional benefit to be had; and increased competition driven by globalisation and deregulation, is making it increasingly difficult to sustain and grow profits.

According to Karl Campbell, Managing Director PQ Telesystems (Intelligence Vol. 5 No 10 1999), CRM is about turning the focus of organisations towards their customers.  Campbell says, "At its core, CRM places the customer at the centre of the focus of the systems.  It also aims to raise the efficiency of the functional areas including marketing, selling, servicing and support.  CRM focuses on employee processes and internal information sharing." 

In the long-term CRM assists in the reduction of general and administrative expense and streamlines the delivery of the product to the market.  Customers, suppliers, business partners and employees are all key elements of the value chain.

Many companies currently operate with silos of information between business units and one each is offering different products to the same clients, they don't always share information across their domains.  This is particularly relevant in large organisations such as banks.  According to Russell von Ruben, Country Executive, IBM SA's CRM unit, the average client receives between 10 and 30 contacts from different people in the same organisation.  "This only highlights the need to integrate Back Office applications with the front office,” says Russell von Ruben. "The single biggest message is - Why don’t you know who I am?"

Organisations can create marketing intelligence through the proactive collection of customer information, contact history and past purchases.  However, in order to be able to use this information effectively companies need to manage and control the replication and synchronisation of the various databases.

According to McKinsey and Company (1995).  "Ninety percent of US banks have some sort of marketing customer information file, and many are using it for direct mail purposes.  But few are building competitive advantage by continuously refining differentiated product offerings and targeting them to customers or prospects for whom they will create real value." 

In his paper "The High Cost of Low Quality Data", Larry English (1999) quotes the following example.  "One insurance company had a list of 12 sacred data elements that were considered so important that if the data was wrong, the company would fail.  When it did a data inventory, it discovered that these data elements were maintained in 43 separate data bases by 43 independent applications with data entered by 43 different data producers".

In the same paper Larry English gives the example of a major bank that had to analyse 251 different customer data bases just to answer the question "Who is our best customer?"

Many companies launch customer service initiatives and customer loyalty programmes but neglect to change their systems to accommodate and support these initiatives.  It is important for employees to have access to back office systems which include information about customers and suppliers, as both are integral parts of CRM. 

Russell von Ruben, Country Executive IBM SA's CRM unit, also says. “Companies should keep details of every interaction at every point of contact.  If the systems were in place when a customer voiced a concern, somebody could find out about the experience and make amends.”

Provided companies are able to support their CRM strategies with proper back office integration and data analysis there are huge savings to be made. 
 

Integration of CRM Strategies on the Internet..........