CUSTOMER RELATIONSHIP MANAGEMENT: CONCEPTS AND TOOLS

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CUSTOMER RELATIONSHIP MANAGEMENTCONCEPTS AND
TOOLS

• Chapter 3
• Information Technology For Customer Relationship
  Management

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Enterprise Systems
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Origins of CRM technology

• Stand-alone technologies
• Call centres
• Sales force automation systems
• Data analytics
• Customer information files

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Why is technology necessary?

• As companies grow they become separated from the
  customers and cultures they intuitively
  understand
• Customer knowledge is maintained in both dry
  memory
• nnn Documents, nnn Spreadsheets, nnn Emailsnnn
  Customer cards, nnn Reports
• and wet memory, i.e. the heads of people
• CRM technology captures, stores, analyses and
  distributes this information for marketing,
  sales and service operations

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Single view of the customer?
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Ultimate goal of CRM technology

• The ultimate goal is consistently excellent
  customer experience across all channels, i.e.
  multi-channel CRM
• All customer contact channels such as sales,
  partners, marketing, and the service centre are
  consolidated into a single view of the customer,
  across all communication media including
  face-to-face, voice telephony, email, web, and
  wireless.
• Customers expect continuous, consistent dialogue
  with a company, irrespective of the systems and
  departments within

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Single View of the CustomerShared
Customer-Related Knowledgebase
Multi-channel CRM
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360 degree view of the customer
Courtesy PeopleSoft
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What must CRM technologies accomplish?

• CRM must
• be flexible enough to stay in touch with a
  changing audience (the customer)
• meet different operational requirements in
  different industries
• be accessible to external stakeholders and mobile
  professionals such as salespeople and field
  technicians.
• operate over any communication channel
• must integrate with other systems to provide a
  single view of, and for, the customer.
• must be implemented in such a way that
  appropriate work practices and skills are
  deployed, as many of the requirements of CRM
  cannot be solved by technology alone

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Global Enterprise Application Software sales
Source Gartner Dataquest
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EAS points of note

• CRM software valued at over one-third of overall
  EAS sales
• CRM software touches both sides of the profit
  equation revenues and costs
• ERP and SCM software touch cost-side only
• Many more user seats needed for customer-side
  software, than ERP or SCM
• marketers, salespeople, contact centre, field
  technicians, partners, customers, distributors

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Early adopter profiles

• Geography
• North America, Europe
• Industries
• Banking
• Finance
• Telecommunications

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CRM issues vary by industry
Churn Share of wallet Call centres Data
mining Dealer networks Service and
maintenance Customer knowledge Portals Complex
selling Channels Product configurator Partner
portal Retail trade Trade spend and promos Store
audits Complex customer structures
Telcos and Banks
Automotive Manufacturers
CRM?
High Technology
Consumer Goods Beverage
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Some members of the CRM ecosystem
CRM SW Vendors Siebel PeopleSoft Oracle SAP
Specialist SW Vendors SAS NCR salesforce.com O4
Midmarket SW Vendors Pivotal Onyx Microsoft Salesl
ogix
Service Providers Peppers Rogers Customer
Connect Accenture IBM Unisys EDS
Hardware and Infrastructure IBM Hewlett-Packard Ge
nesys Siemens Avaya
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Classifying CRM service providers
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Issues in CRM architecture

• Architecture is the way in which the system is
  constructed
• CRM systems must be able to operate in the
  office, out of the office, and over the web.
• CRM systems must tie together multiple
  communication channels each using very different
  technologies (web, email, telephone).
• CRM systems must perform well enough, and be
  flexible enough, to suit a constantly changing,
  potentially growing user community.
• Some users may be both partners and competitors.
  The architecture must recognise this

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Contemporary architectural challenges

• Growth in number of communication technologies
• voice phone, fax, email, web, SMS, advertising,
  direct mail, salespeople
• Growth in number of company touch points
• Branch, contact centre, field service, service
  desk

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Architectural excellence 1

• Usability
• Ease of navigation or use
• Intuitive, requiring minimal effort to reach the
  desired outcome
• Little training needed
• Perceived as highly responsive by the customer
• Flexibility
• An applications flexibility determines how many
  alternatives are available to the user at any
  given time
• These alternatives are often implemented through
  hyperlinks, buttons, or screen

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Architectural excellence 2

• Performance
• All technologies must be aligned
• Performance of the overall system is often
  determined by the performance of the weakest link
• Network performance, database performance and
  server performance all influence CRM system
  overall performance
• Integration and synchronisation issues
• Scalability
• As the CRM system grows, and is used by more
  internal and external people, the scalability of
  the system becomes important

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Typical CRM architecture
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Architectural solutions for CRM challenges
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Mobile and wireless technologies

• Many businesses go to the customers premises
• Salespeople, service technicians.
• Important to overall customer experience
• Need current customer and product information
• Two main technologies available to support
  mobile professionals
• mobile (synchronised)
• handheld or laptop device, with a small resident
  database
• wireless (online)
• handheld device connected to the main system
  using a wireless connection such as a mobile phone

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Metadata

• Metadata are data about data
• Meta data includes data about the layout of the
  columns, rules for validation, lists of values,
  even the processes to be represented on a
  devices screen
• Metadata stored in a separate database
• The final result on the screen is a combination
  of the core processing logic, the metadata
  (business rules), and the data itself (extracted
  from customer records).
• The metadata repository is typically modified
  using a set of tools, provided by the CRM
  software vendor
• Examples PeopleTools (PeopleSoft), Siebel Tools,
  and Studio (E.piphany).

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Knowledge management

• A central element to effective CRM is storing and
  leveraging knowledge about the customer
• structured, transactional data such as contact
  history and account balances
• unstructured information such as letters and
  faxes from the customer, and notes on telephone
  conversations
• The success of CRM depends largely on how well
  this information is converted into
  enterprise-wide knowledge

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Browser interface
Courtesy Oracle
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CRM benefits from browser technologies

• The hyperlink-driven user interface is ideal for
  the loosely structured flow of most
  customer-facing dialogues.
• The ubiquitous nature of the web also makes it
  relatively easy for people to learn how to
  navigate in such an application.
• Particularly important with customer- and
  partner-facing applications
• Web technologies also play in important role in
  integration and mobile solutions.
• XML (extensible mark-up language), a standard,
  flexible format for the description of documents
  over the web, is becoming a standard language for
  integration between applications

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Workflow within CRM

• In CRM many customer-related processes are
  predefined and automated
• Business rules that are critical to the success
  of sales, marketing and service no longer need to
  be manually managed.
• Workflow technologies can be programmed to
  monitor for predefined conditions.
• The end result is that customers receive a
  consistent, predictable experience

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Workflow for sales lead assignment
Courtesy Siebel
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Contexts of workflow automation 1

• Process automation
• when an email comes in from a customer in
  southern region, automatically respond with the
  following
• Escalation
• if a service call is 20 hours old, of high
  severity, and from a high value customer, and the
  status is not resolved, page the service manager
• Assignment
• when a lead comes in from the web site, look at
  the product being offered, the territory, and the
  current workloads of my salespeople, and assign
  the lead to the best person

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Contexts of workflow automation 2

• Integration
• if the customer submits a confirmed order,
  automatically post it to the fulfilment system
  for verification and dispatch
• Dialog scripting
• when a customer calls in, prompt the call centre
  agent with a standard welcome script. Register
  the customers response, then determine the best
  course of action, and offer the agent a script
  accordingly. Continue this process to increase
  the chance of up-selling the customer
• Process navigation
• if the customer does not offer their password,
  automatically navigate the user to the customer
  identification screen

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Types of integration

• Batch processing
• Stores information up in a file or batch, then
  moves the information across the interface into
  the destination system in one batch.
• The cost is opportunities lost in the wait before
  moving the information
• Real-time
• Occurs immediately
• once a customer record is updated in one system,
  the change is immediately reflected in the
  destination system

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4 areas of CRM integration 1

• Application integration
• Integrates front-office systems with back-office
• accounting, billing, inventory and human
  resources
• Telephony integration
• Ties the CRM application in to the telephone
  system,
• inbound calls can be routed to the right person
• allows outbound calls can be made from the
  contact centre desktop

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4 areas of CRM integration 2

• Email integration
• Can involve both the generation of emails as a
  result of an internal workflow process, and as an
  automated email response
• Web integration
• Integration of the web site into the CRM
  implementation
• May also involve web chat or web collaboration

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CRM applications
Sales (synchronised, field information)
Service (orders, complaints)
Management (decision support, performance)
Partner (promotions, funds, portals)
Data Knowledge Base
Consumer (web, clubs)
Warehouse
Web
Marketing (analysis, promotions actuals)
CRM System
Other systems, email, telephone
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Marketing automation
Customers
History
Attributes
Permission personalisation
Segments
Lists
Campaigns
Leads / opportunities
Plans
Budgets
Marketing funds
Activities
Responses
Partners
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Marketing automation example 1
Courtesy E.piphany,
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Marketing automation example 2
Courtesy Pivotal
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Sales force automation (SFA)
Customers
Products
Configuration
Buying process
Competitors
Quotes, presentations, proposals
Leads
Opportunities
Sales orders
Customer products
Sales team
Activities
Sales methodology
Territory
Forecasts
Partners
Objectives and tactics
Incentives
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SFA application at retail PDA example
Courtesy O4
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Service and support automation
Agreements warranties
Customers
Service team
Activities
Inventory
Dialogue scripts
Service requests
Service Orders Return Material Authorisation
Resolutions
Customer products
Products
Known issues
Solutions
Manuals
Maintenance plans
Defects
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Portal example 1
Courtesy Pivotal
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Portal example 2
Courtesy SAP
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CRM analytics basics

• Management wants to measures key results
• customer value, satisfaction and propensity to
  churn
• The three levels of analysis in todays CRM
  systems, in increasing order of complexity
• standard reporting
• online analytical processing
• data mining.

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Reporting standardised or query-based

• Standardised reports are typically delivered with
  the CRM software application, but often require
  customisation

• Query-based reporting presents the user with a
  selection of tools, which can then be used to
  construct the report that is currently required.
• Far more flexible, but is not suitable for the
  regular, standard operational requirements

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OLAP

• Online Analytical Processing (OLAP)
• OLAP technologies allow information to be
  transformed into a format that suits analysis and
  ad-hoc inquiry, and stored in a data warehouse
• Supports rapid slicing and dicing, allowing users
  to drill down on graphs and tables to analyse
  where a certain figure or problem may have arisen
• Applications
• Sales people can analyse their territory to
  determine revenue and profitability by customer.
• Service people can analyse call response rates
  and times.
• Partner managers can analyse the performance of
  partners by marketing fund approvals and
  partner-generated revenues.

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Analytics example 1
Courtesy Siebel
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Analytics example 2
Courtesy E.piphany
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Analytics

• Customer value
• Customer satisfaction
• Next purchase
• Channels
• Partner contribution
• Web activity

• Supplier evaluation
• Campaign success
• Sales activity
• Segmentation
• Customer profiling

• Risk scoring
• Prospecting
• Propensity to buy
• Revenue
• Volume
• Brand
• Profitability

ERP
CRM Transactions
CRM Analytics (OLAP)
Other Data
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Other CRM stakeholders

• Partners
• Employees
• Suppliers
• Investors

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Partner relationship management
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CRM technologies across the CRM value chain 1
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CRM technologies across the CRM value chain 2