SBM & EA Discussion
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group_3_crm.pptxCustomer Relations Management (CRM) Enterprise System Considerations
Group 3
Kristopher Johnson,Selinda Montgomery, Glenda Lopez, Matthew Popp, and James Spears
University of Maryland University College – IFSM 311
April 30, 2017
Agenda
Introduction
CRM Case Studies Corporate Insight
Amazon
Harmond Bank
CRM Assessments for Each Study: Failures and Accomplishments
CRM Implementation: Benefits and Limitations
CRM Planning and Success Criteria
Conclusion
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The agenda provides elements each slides will discuss throughout the presentation.
Introduction
The selection of a business systems depends on the needs of the company. The following presentation summarizes two cases studies that implemented a CRM after re-engineering their business process, to cope with emerging technologies.
2
The introduction sets the roadmap for the presentation and should give you a clear idea of the presentation.
CRM Case Studies Corporate Insight
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EXPLAIN WHAT CRM IS:
Customer Relationship Management (CRM) is a business strategy to acquire and manage the most valuable customer relationships. CRM requires a customer centric business philosophy and culture to support effective marketing, sales and service processes. CRM applications can enable effective customer relationship management, provided that an enterprise has the right leadership, strategy and culture (Siebel, 2016).
Reference:
Siebel CRM 8.1: Navigation & Configuration. (2016). Google Books. Retrieved 8
September 2016, from https://books.google.com/books/CRM
CRM: Amazon Overview
4
Amazon is a leading e-commerce company
Originally started as a book retailer
Sells millions of products to customers all over the world
Sells an extensive range of products through its own
Store as well as through extensive online marketplaces
CRM Challenges
Strong customer relationship
Studying customers interest and personality
Efficient checkout process
DEBRIEF ON AMAZON:
Amazon as a leading e-commerce company was able to understand their customers needs and provide them with the products they want—quickly. However with expansion Amazon faced some challenges. A strong customer relationship is crucial for Amazon to keep customers from shopping at other destinations. It is important that when a customer enters Amazon for the first time the system creates value for the customer by studying their interest and personality. This is why the company began making product recommendations based on purchase history. Amazon implemented the CRM enterprise system as an integral part of their business model in order to maintain a refined communication system that would automate this process.
Amazon – Approach to Success
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Implementation of CRM System
Information System
Transaction Processing System
Recommendation System
Efficient Checkout Process
Understand Customer’s Interest
Study Market Trending
Gather Customer Feedbacks
Amazon’s web service has become a global platform for individuals and retailers to sell their products (Imran, 2014, p.3). Through the implementation of a CRM system Amazon was able to improve its transaction processing system, recommendation system and checkout processes.
Amazon was able to create global domination. An information system is very important for the analysis of data, for Amazon, in order to provide its customers with a reliable, scalable and robust web services. The Information System utilizes Customer Relation Management to track customer spending through their search history, data mining and wish list which allows Amazon to retain crucial information about its customers so they can make future recommendations. By studying customers interest and behavior, Amazon has improved communication with customers and retailers and the simplified processes enhanced overall customer interaction on the website.
Transaction Processing System utilizes CRM to reduce the process steps when a customer makes purchases and are ready to check out. This system allows the customer to purchase products using 1-click ordering, which personalizes shopping services through easy to use card transactions. As a result, there was an increase in order processing simple because customers were able to checkout in fewer steps. The Recommendation System involves an intelligent recommendation system, which recommends items by a customer’s past purchases and searching data gathered through the Information System. This system stores every order made by customer to provide an enhanced browsing experience when they come back to the web site. As a result, there is expansion on product recognition and leverage capabilities, while increasing and maintaining excellent customer satisfaction.
Reference:
Imran, A. (2014). A STUDY ON AMAZON: INFORMATION SYSTEMS, BUSINESS STRATEGIES AND e-CRM. ResearchGate. Retrieved 8 September 2016, from
(2016). Retrieved 6 October 2016, from
Amazon continued…
6
Performance
Simplifying processes and customer interaction on the
website
Allowing customers to check out in fewer steps
Studying customers interest and behavior
Quality
Focus on exact needs of customers
Improve communication with customers
Maintain excellent customer satisfaction
Amazon’s website has been customized with one click purchasing. The website has been simplified to provide customers with a unique, expedited checkout process. This allows the customer to checkout quick, with as few steps as possible and ensures that the customer commits to the purchase and doesn’t change their mind because the checkout process is cumbersome.
CRM Benefits: Amazon
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The benefits of the CRM System
Offer expedited deliveries to customers
Lower cost and increase revenue
Direct sales approach
Maximize up selling and cross-selling
Improved customer relations
Optimize marketing
Better internal communication
Gain competitive advantage
Customer Relationship Management is a system which aims at improving the relationship with existing customers, finding new prospective customers, and winning back former customers.
Amazon will be able to offer expedited deliveries to customers by eliminating inefficient processes in the delivery phase. By allowing vendors to ship products directly to customers, Amazon will benefit from lower cost for warehouse storage and increased revenue by collecting a fee from vendors. This ties into direct approach of selling through amazon. Amazon provides the platform for the vendors and in return generates a revenue.
The CRM system allows Amazon to up-sell by offering premium products to customers based on the product category. The strategy also facilitates cross selling by offering products based on previous purchases. Amazon benefits from this through the CRM system, by interacting with customers, tracking their purchasing patterns, and the products they previously purchased. The data obtained is then stored into a database where top management can make decisions on which products to promote in-order to maximize up-selling and cross selling.
One of the prime benefits of using a CRM is continuously improving customer satisfaction. By using this strategy, all dealings involving servicing, marketing, and selling of the products to the customers can be carried out in an organized and systematic way. You can also provide better services to customers through improved understanding of their issues and this in turn helps in increasing customer loyalty and decreasing customer agitation. In this way, Amazon can also receive continuous feedback from customers regarding products and services. It is also possible for customers to recommend Amazon to their friends and family, when providing efficient and satisfactory services.
With the help of CRM system Amazon is able to better interact and understand their customers, thereby allowing them to market certain products in the correct time. CRM will also give Amazon an idea about the most profitable customer groups, and by using this information they are able to target similar prospective groups, at the right time. In this way, they are able to optimize marketing resources efficiently. This strategy also ensures that they don’t waste time on less profitable customer groups.
Reference:
Klie, L. (2015). Integrate CRM and ERP for better intelligence: businesses benefit when information flows freely between systems. CRM
Magazine, (9). 28.
Wailgum, T. (2007). E-Commerce Prophet. CIO, 21(1), 44.
What are the benefits of using CRM for your business?. (2016). Blog.perfectmind.com. Retrieved 5 October 2016, from
http://blog.perfectmind.com/benefits-of-using-crm-for-your-business
CRM Limitations: Amazon
Technical Limitations
data and file storage
customer’s account limits
customer’s database
vendors database
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The CRM system is designed to help businesses cut costs and improve workflow efficiencies, however each system comes with some type of limitations.
The CRM system for Amazon requires huge databases and file storage due to its data analytics collection. Therefore Amazon has to take into considerations the services available through its data centers regarding data storage limitations so they don’t encounter any issues in the future.
Reference:
Limitations of CRM | thoughtleadership.liquidhub.com. (2016). Blog.liquidhub.com. Retrieved 6 October 2016, from
http://blog.liquidhub.com/2015/02/38848
CRM Case Study Evaluation Points: Amazon
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Cost
Reduced the operational cost
Variable cost structure
Expand products and leverage capabilities
Schedule
Effective delivery speed
Receiving orders on time
Efficient order processing
Amazon web service has become a global platform for individual to retailers to sell their products (Imran, 2014, p.3). Amazon is able to reduce overall operational cost by doing drop shipment directly from the seller, as opposed to purchasing the product from the seller then storing products in their warehouse prior to shipment. With this system, Amazon is able to offer more products to its customers and leverage capabilities through saved costs.
Amazon is also able to offer faster shipping services through direct shipping from the vendor to the customer. Having products ship directly from the vendor to the customer eliminaties unnecessary processes and the customers receive their order quickly.
Reference:
Imran, A. (2014). A STUDY ON AMAZON: INFORMATION SYSTEMS, BUSINESS STRATEGIES AND e-CRM. ResearchGate. Retrieved 8
September 2016, from
https://www.researchgate.net/publication/261440748_A_STUDY_ON_AMAZON_INFORMATION_SYSTEMS_BUSINESS_STRATEGIES_AND_e-CRM
CRM Case Study Evaluation Points: Amazon continued…
Performance
Simplifying processes and customer interaction on the website
Allowing customers to check out in fewer steps
Studying customers interest and behavior
Quality
Focus on exact needs of customers
Improve communication with customers
Maintain excellent customer satisfaction
10
Amazon’s website has been customized to a one click purchase, where the interaction between the customer and the website has been simplified to provide customers with a unique browsing ordering and check out process. This allows the customer to checkout quick, with as few steps as possible. This ensures that the customer commits to the purchase and not change their mind because the checkout process is cumbersome.
Amazon’s website also monitors the customer’s interest and personality by tracking the products they frequently purchase and recommending similar products. This enhances the customer’s experience shopping on Amazon. It also maintains an excellent customer satisfaction and provides better communication with customers.
CRM: Harmond Bank Overview
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Harmond Bank is a financial and consolidated institution with over 80 years in the banking market and more than 600 employees and provides high standards through their strong customer service.
In order to offer and retain its customers through better service the management of Harmond Bank Implemented the CRM system.
DEBRIEF ON HARMOND BANK:
Harmond Bank is a financial institution and the main transaction the institution supports are customer mortgage requests.
Although the bank is a very consolidated institution and offers other types of services; due to outdated applications and high-volume of applications received it was difficult to maintain and keep up with performance. In addition to performance issues, it was becoming expensive to manage, so bank management decided the integration of a Customer Relationship Management system with the current Enterprise Architecture to speedup and re-structure the current processes (Lam, 2005). Due to the expansion Harmond Bank faced several challenges maintaining customer satisfaction because of the inefficiency in the processes and no online services meant customers had to wait a long time before being served.
Reference:
Lam, W. (2005). AN ENTERPRISE APPLICATION INTEGRATION (EAI) CASESTUDY: SEAMLESS MORTGAGE PROCESSING AT HARMOND BANK.
The Journal of Computer Information Systems, 46(1), 35-43. Retrieved from
http://ezproxy.umuc.edu/login?url=http://search.proquest.com.ezproxy.umuc.edu/docview/232575620?accountid=14580
Harmond Bank: Reality Vs Expectations
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Back in 2004-05 Harmond Bank faced some CRM challenge:
Increase and difficulty on customer retention
Application interfaces became expensive to maintain.
No online banking services were offered.
After Implementation of CRM System at HB
Good streamline and process efficiency
Standardization of System applications
Online banking services
HARMOND BANK: CRM ASSESSMENT
Harmond bank was facing different challenges at the beginning of the new millennium. And after evaluating different factors such as the difficulties in customer retention, because of the outdated systems and the cost of its maintenance, implementation of the new CRM System was their best solution.
The first bullet represents some of the challenges faced at that time. The second bullet shows the results after implementation, with the advantages expected. As a result, Harmond Bank was able to reach and offer more services to its customers. Its CRM demonstrated to be a good move as they were able to get new customers. In addition, their online system helped customers and staff speed-up all processes related to mortgage transactions that would normally require a customer to be present in one of the branches.
CRM Limitations: Harmond Bank
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Integration Limitations
Compatibility with existing system
Hardware requirements
Implementing CRM as a product is expensive
Takes time to setup and configure
Transition Limitations
Cultural organizational shock
Employee training
HARMOND BANK LIMITATIONS
Harmond bank initially did not follow any type of architecture on its systems that’s why the integration between a whole new structure to standardize processes and applications was very difficult to integrate at first. The hardware and software that Harmond bank had was not the most optimal in regards of speed efficiency, although the team made all possible efforts to provide the best with what was available.
As a result, transformation of a new architecture came with a complete renovation in hardware that could easily be integrated with the new software, but it became a limitation since the bank could not do the transition all at once, instead it was done section by section, department by department.
CRM Assessments: Harmond Bank
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Project Cost Increased
Due to the prolongation on implementation.
The slow mode of the new architecture implementation.
Schedule Delivery Delayed
Slow pace during implementation process,
Considerable time was taken from the implementation
Process to decide the type of data modeling that would fit best with Harmond Bank.
HARMOND BANK ASSESSMENT PART 1
The initial cost for Harmond Bank was expensive due to the prolonged time it took for implementation.
Why slow paced? Well, the team had to spend a considerable amount of time learning and training on understanding the business architecture in place before they could possibly implement the CRM system. Since the IT team was not familiar with the architecture and CRM as whole migration was slower than what initially thought.
CRM Assessments: Harmond Bank
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Performance
Enhanced capabilities of the current services, and providing more intuitive tools to the customer through the internet.
Obtaining metrics that would help analyze and study the customer’s experience on their portal.
Reduction of processes by combining some of them through the new system
Quality
Services were improved in the long term
The bank was able to reach out and offer more services to customers
HARMOND BANK ASSESSMENT PART 2
Even though the CRM system implementation was expensive and prolonged, the system performance improved significantly.
For instance, current processes were enhanced with new capabilities such as providing online banking services to customers, and increasing self-service. The reduced need of having customers going to an actual branch for simple transactions greatly improved customer satisfaction.
Another factor that improved service quality improved the customer service by allowing the bank to respond to customer demand quicker and address any issues or concern they might have. The new system uses data analytics to track the customer's experience, and improve services. The bank was not only able to retain its customers but was also able to gain new customers and maintain very good customer satisfaction, which previously was very hard due to the growth of the bank.
Reference:
Vella, J., & Caruana, A. (2012). Encouraging CRM systems usage
Harmond Bank Benefits After CRM Implementation
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Improved application processes
Integrate online banking
Reduce lines at bank’s counter
Faster and updated transaction processes
Integrate self-service through online banking
Increased customer satisfaction and retention
BENEFITS
The transition and improvement in the current architecture brought many benefits.
System application and process standardization made mortgage and other transaction requests simpler and more efficient.
HB got an extra enhancement by having online banking, which wasn’t available before, the ability to facilitate resources to its customers; saving time not only for the staff at the bank but also to their customers when going to the bank.
The result of updating several of the processes gave more retention among HB customers and were more likely to recommend the bank to prospective customers, which made HB stand out among its competitors.
General Considerations to Implement a CRM system
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Internal Technology Capabilities
Culture of the organization
Information System
Business
Aligning Business strategies with Information System
Data Security, Backup and Recovery
Design phase
Development phase
Implementation phase
GENERAL CONSIDERATIONS (PART 1)
The CRM system is a great tool to create an extend relationship as long as it does exactly what the organization needs it to do. In order to ensure that the CRM system is customized to do exactly what the organization wants there are some considerations that must be discussed.
Internal Technology capabilities is an important factor to consider before investing into the CRM system. The existing technological capabilities of the organization has to be considered. This will allow key decision makers to support the project for ongoing success.
The culture of the organization is also important. With the implementation of the CRM system everything will be centralized and interconnected. Different departments will have to work together as one big team. Therefore understanding the current culture can help alleviate issues in the future among different department within the organization.
Data security, backup and recovery are among the most important factors to consider when implementing a new CRM system. Whether the CRM system will be cloud based or stored on a local server these considerations are critical is a disaster were to occur. Proper steps has to be put in place to ensure the organization’s data are safe and backed up regularly. In addition policies and steps to recover after a disaster has to be in place to minimize downtime and loss of revenue.
Reference:
Considerations for buying the right CRM tool. (2016). SearchCRM. Retrieved 4 October 2016, from http://searchcrm.techtarget.com/feature/Considerations-for-buying-the-right-CRM-tool
Persson, A., & Ryals, L. (2014). Making customer relationship decisions: Analytics v rules of thumb. Journal Of Business Research, 671725-1732. doi:10.1016/j.jbusres.2014.02.019
Vella, J., & Caruana, A. (2012). Encouraging CRM systems usage
General Considerations to Implement a CRM system continued...
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Policy for regulatory and compliance requirements
Platform and cultural organization
Having a clear understanding of System Development Life Cycle (SDLC)
GENERAL CONSIDERATIONS (PART 2):
1. It is important to ensure that the organization stays in compliance with the law and local and organizational policies.
A clear example of that is Harmond bank, which had to operate under different regulatory constraints knowing that different cities may have extra regulation on financial institutions and if the bank has branches outside the country then we have to add international regulations as well.
Something that Amazon may not have as strict, due to the sensitivity of customer information they manage. However, both companies have to make sure they are in compliance when handling sensitive customer information to avoid any lawsuits.
2. By studying these two cases we conclude that companies have to understand their current platform and ecosystems to determine the approach they want their company to take in the future. Having a good understanding about the company's platform and how they are connected to the engagement tool will ensure that the system grows in parallel with the business.
3. Organization’s management and technical team will facilitate estimations of deployment time when re-structuring sections of current architecture in an organization. It is also important to take into consideration when the system will no longer be valid and will need to be decommissioned or upgraded to a newer version, so cost and maintenance can be planned.
Reference:
Justice Management Division. (2003, January). Systems development life cycle guidance document. Washington, DC: Department of Justice.
Considerations for buying the right CRM tool. (2016). SearchCRM. Retrieved 4 October 2016, from http://searchcrm.techtarget.com/feature/Considerations-for-buying-the-right-CRM-tool
The Best Fit
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Assess and understand organizational goals
Study customer's personality to understand market trends
Identify the key weaknesses and strengths of the organizations
Understand benefits and cost of the CRM system
Issues the organizations are trying to solve
Identifying must have features of the CRM system
Both organizations are now fully capable of maintaining customer satisfaction by understanding their interest and promoting products and services that they want at the right time. They are also able to eliminate unnecessary processes, improve internal collaboration and retain existing customers all through successful implementation of a CRM system.
CRM Planning & Success Criteria
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11 steps to develop an effective CRM plan:
Build a project Team
Define your CRM vision
Prioritize your CRM goals
Map out your processes
Consider reporting output
CRM data capture
Prepare your data
Integrating CRM
Managing user security
Identify the risk
Create a user adoption plan
DESCRIPTION OF EACH CRITERIA ITEM:
In order for the CRM system to be successful, the implementation strategy has to be effective. Therefore, planning is crucial for developing a bulletproof plan. These 11 steps are the difference between failure and success of the CRM implementation.
1. Building a project team is essential to secure buy in across the organization starting at the top with board level management support.
It is important to gain support from the top level management from the early stages. Their involvement and acceptance of the project
will ensure success. A recommended CRM project team will include an executive sponsor, a project manager, a CRM administrator and
key users for each team.
2. Defining your CRM vision will set high level goals that will be the benchmark for the project.
3. Instead of tackling all the goals at once, it’s best to break it down into smaller goals. This approach will allow for prioritizing more
important goals first and ensure that the plan is more realistic.
4. Mapping out the current processes is important to determine how they will be managed in CRM. This will give an opportunity to
understand how well the current processes are working and understand how CRM can improve their efficiency.
5. Measuring progress is an important step of the CRM. Being able to track progress and success will allow top management to see the
importance of CRM and continue support.
6. Data quality is crucial, therefore it is important to capture each CRM record to achieve your goals.
7. To ensure successful data migration from the current system to the new CRM system it is important not to underestimate the existing
data.
8. Proper integration of the CRM system with other application within the system is important to make sure the data flow is efficient and
data is feeding correctly from one application to the other. Examples of CRM integration can include email marketing, web forms,
SharePoint, and e-commerce platform.
9. Understanding how the CRM system will be used in the organization is crucial to maintain security by creating user access policy and
defining level of access for each users. Controlling user access contributes to managing user security.
10. Risks is involved in any projects therefore identifying the risks that can threaten the success of the CRM system early can help reduce
risks significantly in the future.
11. The biggest risk to CRM success is low user adoption. Successful CRM projects engage with multiple users at an early stage to consult
for ideas and stimulate interest in CRM. Building support from the ground up will ensure that user adoption is not challenge.
Reference:
Basaez, M. O., Aranda, D. A., Djundubaev, R., & Montesano's, F. S. (2014). The Role of CRM-SRM Bolt-owns in Enterprise Resource Planning System: Toward a Customer-Oriented Supply Chain. Strategic Change, (5-6), 389. doi:10.1002/jsc.1984
Partner, P. & Partner, P. (2014). The 11 Step Plan for CRM Success - CRM Software Blog. CRM Software Blog. Retrieved 6 October 2016, from http://www.crmsoftwareblog.com/2014/07/the-11-step-plan-for-crm-success/
Conclusion
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It is crucial to fully understand the organization’s structure so that it gets easier to determine what type of architecture will fit specific needs for the CRM System. Some important points in the process
CRM Research and what it means to a company
Lessons Learned through: Amazon & The Harmond Bank
CONCLUSION
By doing the case studies on these two companies (Amazon and Harmond Bank) and their CRM systems, we were able to learn about the relevance the current architecture plays and how it can be adapted to emergent components and be integrated for better results in the company. The different areas that have to be taken into account when implementing it, such as organization’s culture, capability of the permanent staff, and the resources available.
Both companies had success in implementing the CRM system. Amazon was quick to make changes to their current system and was able to capitalize on the benefits of the CRM system early without losing much to competitor. Harmond bank however took longer for the implementation of the CRM system and as a result lost market shares in the competitive banking market.
We determined the benefits for our organizations by looking at how the CRM implementation benefited Amazon and Harmond bank in terms of reducing costs, increasing revenue, improving current processes and maintaining customer satisfaction. The decision to determine which CRM system will be best for our organization will be based on our customer needs, security, SDLC and how to align business and IT to achieve strategic goals.
A lot of information and factors has to be considered in order to properly plan the implementation of a CRM system and achieve success.
Questions
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If anyone has question about the presentation feel free to post it on the discussion board, and our team will do the best to answer your questions.
References
Basaez, M. O., Aranda, D. A., Djundubaev, R., & Montesano's, F. S. (2014). The Role of CRM-SRM
Bolt-ons in Enterprise Resource Planning System: Toward a Customer-Oriented Supply Chain.
Strategic Change, (5-6), 389. doi:10.1002/jsc.1984
from http://www.crmsoftwareblog.com/2014/07/the-11-step-plan-for-crm-success/mran, A. (2014). A
STUDY ON AMAZON: INFORMATION SYSTEMS, BUSINESS STRATEGIES AND e-CRM.
ResearchGate. Retrieved 8 September 2016, from
https://www.researchgate.net/publication/261440748_A_STUDY_ON_AMAZON_INFORMATION_SYSTEMS_BUSINESS_STRATEGIES_AND_e-CRM
Lam, W. (2005). AN ENTERPRISE APPLICATION INTEGRATION (EAI) CASESTUDY: SEAMLESS
MORTGAGE PROCESSING AT HARMOND BANK. The Journal of Computer Information Systems,
46(1), 35-43. Retrieved from http://ezproxy.umuc.edu/login?url=http://search.proquest.com.ezproxy.umuc.edu/docview/232575620?accountid=14580
Partner, P. & Partner, P. (2014). The 11 Step Plan for CRM Success - CRM Software Blog. CRM Software
Blog. Retrieved 6 October 2016,
Siebel CRM 8.1: Navigation & Configuration. (2016). Google Books. Retrieved 8 September 2016, from
https://books.google.com/books/CRM
Here are all the references we used in our presentation feel free to look at it more deeply.
