CUSTOMER RELATIONSHIP MANAGEMENT PRACTICES
IN SERVICE SECTOR– A COMPARATIVE STUDY OF L.I.C & BANKING IN WARANGAL
THE DEPARTMENT OF COMMERCE AND BUSINESS MANAGEMENT Dr. B. R. AMBEDKAR OPEN UNIVERSITY
FOR ADMISSION INTO
Doctor of Philosophy
SHRAVAN KUMAR KURAM
DEPARTMENT OF COMMERCE AND BUSINESS MANAGEMENT
Dr. B. R. AMBEDKAR OPEN UNIVERSITY
HYDERABAD ( A. P )
CUSTOMER RELATIONSHIP MANAGEMENT PRACTICES IN SERVICE SECTOR - A COMPARATIVE STUDY OF LIC & BANKING IN WARANGAL
Today many businesses such as insurance companies, banks and other service providers realize the importance of CRM and its potential to help them acquire new customers, retain existing ones and maximize their lifetime value. At this point, close relationship with customers will require a strong coordination between IT and marketing departments to provide a long-term retention of selected customers.
CRM is a modern approach to marketing. It focuses on the individual consumer. Customer is the king; therefore, the products and services have to be offered in such a way that they suit the needs and preferences of the customer.
CRM is a sound business strategy to identify the insurance company’s and banks most profitable customers and prospects and devotes time and attention to expanding policy relationships and account relationships with those customers through individualized marketing, repricing, discretionary decision making and customized service-all delivered through the various sales channels that the bank & insurance sector uses.
Customer Relationship Management (CRM):
“Your most unhappy customers are your great source of learning”
- Bill Gates
CRM is a process by which a company maximizes customer information in an effort to increase loyalty and retain customers business over their lifetimes. In literature, many definitions were given to describe CRM. The main difference among these definitions is technological and relationship aspects of CRM. Some authors from marketing background emphasize technological side of CRM while the others consider IT perspective of CRM. From marketing aspect, CRM is defined [Couldwell 1998] as “ a combination of business process and technology that seeks to understand a company’s customers from the perspective of who they are, what they do, and what they are like.” Technological definition of CRM was given as [Peppers and Rogers 1995] “the market place of the future is undergoing a technology –driven metamorphosis”. Consequently, IT and Marketing departments must work closely to implement CRM efficiently.
According to Sweeney Group, 2000 “CRM is a business strategy that goes beyond increasing transaction volume. Its objectives are to increase profitability, revenue, and customer satisfaction. To achieve CRM, a company’s wide set of tools, technologies and procedures promote the relationship with the customer to increase sales. Thus, CRM is primarily a strategic business and process issue rather than a technical issue”.
In the words of Mrs. Thatcher “Quality is when your customers come back, not your Products” hence the customer relationship is utmost important in any organization. The Primary Goals of CRM are to:
• Build a long term and profitable relationship with chosen customers • Get closer to those customers at every point of contact • Maximize your company’s share of the customer’s wallet “If you wish to prosper, let your customer prosper”
Customer Relationship Management Practices in Insurance and Banking Sectors:
Insurance, Banks and financial institutions are recognizing that they can no longer look at a customer from a specific or snapshot perspective but must encompass the entire customer relationship to fully understand a client’s profitability. From a strategic standpoint, CRM mobilizes resources around customer relationships rather than product groups and...