This article explores the plethora of literature available on CRM and relationship marketing and emphasizes the need for a single, process-based framework that helps in making a comprehensive CRM strategy followed by its successful implementation. The objective is to highlight CRM’s role in enhancing customer value and, in turn the shareholder value. Various CRM and marketing experts, who provide their views in the article, emphasize the need for a cross-functional, process-oriented approach which identifies three alternative perspectives of CRM within a holistic organizational context. They try to identify five key cross-functional CRM processes starting from a strategy development process, followed by value creation process, multichannel integration process, an information management process, and in the end performance assessment process. Based on these 5 pillars, they put forward a new conceptual framework specifying the roles and functions associated with each element in the framework.
CRM is a strategic approach that is concerned with creating improved shareholder value through the development of appropriate relationships with key customers and customer segments. There is a need to develop relationship marketing strategies and IT architecture to create profitable, long-term relationships with customers and other key stakeholders. The article is organized mainly in three parts. Firstly, it explores the three alternative perspectives of CRM. Secondly, it considers the need for a cross-functional process-based approach to CRM where the strategists develop criteria for process selection and identify the five key CRM processes. Next, they propose a strategic conceptual framework that is constructed of these five processes followed by the examination of the components of each process. Hence, CRM can be defined with three perspectives forming a continuum. At one corner is the narrowly and tactically defined particular technology solution, followed by wide-ranging technology (customer oriented IT and Internet), and customer centric approach (holistic approach emphasizing creation of shareholder value) as we move towards right at the other end of the continuum.
Processes are the backbone of any initiative or a framework. Absence of a strategic framework for CRM is one reason for the disappointing results associated with many CRM initiatives. The strategic perspective starts with reviewing the following four process selection criteria for marketing and business processes which are now augmented by 2 new additional suggestions.
1)The processes should comprise a small set that addresses tasks critical to the achievement of an organization’s goals. 2)Each process should contribute to the value creation process. 3) Each process should be at a strategic or macro level.
4)The processes need to manifest clear interrelationships.
5) New: Each process should be cross functional in nature.
6)New. Each process would be considered by experienced practitioners as being both logical.
The refining of CRM strategy can start with the interaction research as interaction and communication play a crucial role in the various stages of research. It consists of interaction with various executives, meetings and group discussion with emphasis on testing concepts, new ideas, and results. On the other hand, the process identification and CRM framework creation begins with identification of generic CRM processes which are used by an expert panel of experienced CRM executives. The resultant five generic processes are: the strategy development process, the value creation process, the multichannel integration process, the information management process, and finally the performance assessment process. These five key...