1. BUSINESS DRIVEN TECHNOLOGY Customer Relationship Management
Business Plug-In B4
Customer Relationship Management

2. LEARNING OUTCOMES
Describe the three CRM technologies used by marketing departments
Describe and differentiate the CRM technologies used by sales departments and customer service departments
Compare customer relationship management, supplier relationship management, partner relationship management, and employee relationship management
Summarize the future of customer relationship management
1. Describe the three CRM technologies used by marketing departments
Three marketing operational CRM technologies: List generators compile customer information from a variety of sources and segment the information for different marketing campaigns. Campaign management systems guide users through marketing campaigns. Cross-selling is selling additional products or services. Up-selling increasing the value of the sale.
2. Describe and differentiate the CRM technologies used by sales departments and customer service departments
Three sales operational CRM technologies: Sales management systems automate each phase of the sales process, helping individual sales representatives coordinate and organize all of their accounts. Contact management systems maintain customer contact information and identify prospective customers for future sales. Opportunity management systems target sales opportunities by finding new customers or companies for future sales.
Three customer service operational CRM technologies: Contact center (call center) is where CSRs answer customer inquiries and respond to problems through different touchpoints. Web-based self-service allows customers to use the Web to find answers to their questions or solutions to their problems. Call scripting access organizational databases that track similar issues or questions and automatically generate the details to the CSR who can then relay them to the customer.
3. Compare customer relationship management, supplier relationship management, partner relationship management, and employee relationship management
Supplier relationship management (SRM) focuses on keeping suppliers satisfied by evaluating and categorizing suppliers for different projects, which optimizes supplier selection. Partner relationship management (PRM) focuses on keeping vendors satisfied by managing alliance partner and reseller relationships that provide customers with the optimal sales channel. Employee relationship management (ERM) provides employees with a subset of CRM applications available through a Web browser.
4. Summarize the future of customer relationship management
CRM future trends include:
CRM applications will change from employee-only tools to tools used by suppliers, partners, and even customers
CRM will continue to be a major strategic focus for companies
CRM applications will continue to adapt wireless capabilities supporting mobile sales and mobile customers
CRM suites will incorporate PRM and SRM modules

3. INTRODUCTION
Customer relationship management – involves managing all aspects of a customer’s relationship with an organization to increase customer loyalty and retention and an organization’s profitability
Operational CRM – supports traditional transactional processing for day-to-day front-office operations or systems that deal directly with the customers
Analytical CRM – supports back-office operations and strategic analysis and includes all systems that do not deal directly with the customers
CRM, operational CRM, and analytical CRM were introduced in detail in Chapter 11

4. INTRODUCTION
Operational and Analytical CRM overview

5. INTRODUCTION
Organizations can find their most valuable customers through “RFM” - Recency, Frequency, and Monetary value
How recently a customer purchased items (Recency)
How frequently a customer purchased items (Frequency)
How much a customer spends on each purchase (Monetary Value)
Once a company knows this information, it can begin to strategize marketing campaigns, sales promotions, and other ways to increase business
For example: If Ms. Smith buys only at the height of the season, then the company should send her a special offer during the “off-season”
Ask your students if they have received any personalized promotions lately
How did the company gather information on the student to be able to offer the personalized promotion?

6. The Evolution of CRM
Three phases in the evolution of CRM include reporting, analyzing, and predicting
Discuss the Barclay’s Bank example on page 263
Reporting
Help organizations identify their customers across applications
Analyzing
Help organizations segment their customers into categories such as best and worst customers
Predicting
Help organizations make predictions regarding customer behavior such as which customers are at risk of leaving

7. Reporting, analyzing, and predicting examples
The Evolution of CRM
Reporting, analyzing, and predicting examples
Ask your students to define additional examples of reporting, analyzing, and predicting questions

8. Operational CRM
Operational CRM technologies for sales, marketing, and customer service departments

9. MARKETING AND OPERATIONAL CRM
Three marketing operational CRM technologies:
List generators – compile customer information from a variety of sources and segment the information for different marketing campaigns
Campaign management systems – guide users through marketing campaigns
Cross-selling and up-selling
Cross-selling – selling additional products or services
Up-selling – increasing the value of the sale
Discuss the CSAA example on page 265

10. SALES AND OPERATIONAL CRM
The sales department was the first to begin developing CRM systems with sales force automation – a system that automatically tracks all of the steps in the sales process
Discuss the Vail resorts example on page 266
Walk your students through the sales process displayed in Figure B4.5

11. SALES AND OPERATIONAL CRM
Three sales operational CRM technologies:
Sales management systems – automate each phase of the sales process, helping individual sales representatives coordinate and organize all of their accounts
Contact management systems – maintains customer contact information and identifies prospective customers for future sales
Opportunity management systems – target sales opportunities by finding new customers or companies for future sales
Discuss the 3M example on page 267

12. SALES AND OPERATIONAL CRM
CRM pointers for gaining prospective customers
Ask your students to identify additional pointers for gaining prospective customers

13. CUSTOMER SERVICE AND OPERATIONAL CRM
Three customer service operational CRM technologies:
Contact center (call center) – where CSRs answer customer inquiries and respond to problems through different touchpoints
Web-based self-service – allow customers to use the Web to find answers to their questions or solutions to their problems
Click-to-talk –customers click on a button and talk with a CSR via the Internet
Call scripting – access organizational databases that track similar issues or questions and automatically generate the details to the CSR who can then relay them to the customer
Discuss the FedEx example on page 269 for its outstanding Web-based self-service
Discuss the Documedics example on page 269 for its ability to use call scripting

14. CUSTOMER SERVICE AND OPERATIONAL CRM
Contact centers can include:
Automatic call distribution – a phone switch routes inbound calls to available agents
Interactive voice response (IVR) – directs customers to use touch-tone phones or keywords to navigate or provide information
Predictive dialing – automatically dials outbound calls and when someone answers, the call is forwarded to an available agent
A contact center is part of the customer service department and falls into the category of operational CRM
A contact center (call center) is where CSRs answer customer inquiries and respond to problems through different touchpoints
A contact center is one of the best assets a customer-driven organization can have because maintaining a high level of customer support is critical to obtaining and retaining customers
Automatic call distribution, IVR, and predictive dialing are only three of many different systems available to help an organization automate its contact centers

15. Analytical CRM
Analytical CRM relies heavily on data warehousing technologies and business intelligence to glean insights into customer behavior
These systems quickly aggregate, analyze, and disseminate customer information throughout an organization
Analytical CRM has the ability to provide an organization with information about their customers that was previously impossible to locate, and the resulting payback can be tremendous.
Discuss the Sears, Roebuck and Company example on page 270

16. Analytical CRM
Ask your students to provide additional examples of analytical CRM not covered in Figure B4.7

17. Current Trends: SRM, PRM, and ERM
Current trends include:
Supplier relationship management (SRM) – focuses on keeping suppliers satisfied by evaluating and categorizing suppliers for different projects, which optimizes supplier selection
Partner relationship management (PRM) – focuses on keeping vendors satisfied by managing alliance partner and reseller relationship that provide customers with the optimal sales channel
Employee relationship management (ERM) – provides employees with a subset of CRM applications available through a Web browser
Discuss the HBOS example of SRM on page 271
Discuss the Groupo Gas Natural example of ERM on page 272
Supplier relationship management (SRM) focuses on keeping suppliers satisfied by evaluating and categorizing suppliers for different projects, which optimizes supplier selection. SRM applications help companies analyze vendors based on a number of key variables including strategy, business goals, prices, and markets. The company can then determine the best supplier to collaborate with and can work on developing strong supplier relationships with that supplier. The partners can then work together to streamline processes, outsource services, and provide products that they could not provide individually.
Partner relationship management (PRM) focuses on keeping vendors satisfied by managing alliance partner and reseller relationships that provide customers with the optimal sales channel. PRM’s business strategy is to select and manage partners to optimize their long-term value to an organization. In effect, it means picking the right partners, working with them to help them be successful in dealing with mutual customers, and ensuring that partners and the ultimate end customers are satisfied and successful.
Employee relationship management (ERM) provides employees with a subset of CRM applications available through a Web browser. Many ERM applications assist the employee in dealing with customers by providing detailed information on company products, services, and customer orders. ERM applications typically offer expense tracking, project management tracking, performance appraisals, training, benefits, and company news.

18. CRM future trends include:
CRM applications will change from employee-only tools to tools used by suppliers, partners, and even customers
CRM will continue to be a major strategic focus for companies
CRM applications will continue to adapt wireless capabilities supporting mobile sales and mobile customers
CRM suites will incorporate PRM and SRM modules
Ask your students how they view the future of CRM

19. Closing Case One Fighting Cancer with Information
The American Cancer Society (ACS) is a nationwide voluntary health organization dedicated to eliminating cancer
The ACS choose to implement a CRM solution to solve its information issues
Critical to the CRM system’s success was consolidating information from various databases across the organization to provide a single view of constituents
Case is located on page 273

20. Closing Case One Questions
Explain how the ACS’s marketing department could use operational CRM to strengthen its relationships with its customers
Explain how the ACS’s customer service department could use operational CRM to strengthen its relationships with its customers
Review all of the operational CRM technologies and determine which one would add the greatest value to ACS’s business
1. Explain how the ACS’s marketing department could use operational CRM to strengthen its relationships with its customers
The ACS can use operational CRM to gain a single view of its constituents and all information required to serve them. Three marketing operational CRM technologies that the ACS could use include list generators, campaign management systems, and cross-selling and up-selling. List generators compile customer information from a variety of sources and segment the information for different marketing campaigns. Campaign management systems guide users through marketing campaigns. Cross-selling is selling additional products or services. Up-selling is increasing the value of the sale.
2. Explain how the ACS’s customer service department could use operational CRM to strengthen its relationships with its customers
There are three primary customer service operational CRM technologies that the ACS could use to strengthen its relationships with its customers including contact centers, web-based self-service, and call scripting. Contact center (call center) is where CSRs answer customer inquiries and respond to problems through different touchpoints. Web-based self-service allows customers to use the Web to find answers to their questions or solutions to their problems. Call scripting accesses organizational databases that track similar issues or questions and automatically generates the details to the CSR, who can then relay them to the customer.
3. Review all of the operational CRM technologies and determine which one would add the greatest value to ACS’s business
Student answers to this question will vary. The important factor in this decision will be the students’ justification for their answer.

21. Closing Case One Questions
Describe the benefits ACS could gain from using analytical CRM
Summarize SRM and describe how ACS could use it to increase efficiency in its business
4. Describe the benefits ACS could gain from using analytical CRM
Analytical CRM relies heavily on data warehousing technologies and business intelligence to glean insights into customer behavior. These systems quickly aggregate, analyze, and disseminate customer information throughout an organization. Analytical CRM has the ability to provide the ACS with information about their customers and constituents that was previously impossible to locate, and the resulting payback can be tremendous. The business intelligence provided by an analytical CRM system can provide the ACS with facts that can help lead to innovative cancer drugs and the possible elimination of the disease.
5. Summarize SRM and describe how ACS could use it to increase efficiency in its business
Supplier relationship management (SRM) focuses on keeping suppliers satisfied by evaluating and categorizing suppliers for different projects, which optimizes supplier selection. SRM applications help companies analyze vendors based on a number of key variables including strategy, business goals, prices, and markets. The company can then determine the best supplier to collaborate with and can work on developing strong supplier relationships with that supplier. The partners can then work together to streamline processes, outsource services, and provide products that they could not provide individually.

22. Closing Case Two Calling All Canadians
Canada has become one of the primary targets for outsourcing customer service centers by U.S. companies
Not only are accent and time-zone issues nonexistent, but companies also receive a favorable exchange rate
Case is located on page 275

23. Closing Case Two Questions
What are the two different types of CRM and how can they be used to help an organization gain a competitive advantage?
Explain how a contact center (or call center) can help an organization achieve its CRM goals
Describe three ways an organization can perform CRM functions over the Internet
How will outsourcing contact centers (call centers) to Canada change as future CRM technologies replace current CRM technologies?
1. What are the two different types of CRM and how can they be used to help an organization gain a competitive advantage?
Customer relationship management involves managing all aspects of a customer’s relationship with an organization to increase customer loyalty and retention and an organization’s profitability. Operational CRM supports traditional transactional processing for day-to-day front-office operational or systems that deal directly with the customers. Analytical CRM supports back-office operations and strategic analysis and includes all systems that do not deal directly with the customers. Analytical CRM relies heavily on data warehousing technologies and business intelligence to glean insights into customer behavior. These systems quickly aggregate, analyze, and disseminate customer information throughout an organization. Analytical CRM has the ability to provide an organization with information about their customers and constituents that was previously impossible to locate, and the resulting payback can be tremendous.
2. Explain how a contact center (or call center) can help an organization achieve its CRM goals
A contact center is part of the customer service department and falls into the category of operational CRM. A contact center (call center) is where CSRs answer customer inquiries and respond to problems through different touchpoints. A contact center is one of the best assets a customer-driven organization can have because maintaining a high level of customer support is critical to obtaining and retaining customers. There are numerous systems available to help an organization automate its contact centers including:
Automatic call distribution – a phone switch routes inbound calls to available agents
Interactive voice response (IVR) – directs customers to use touch-tone phones or keywords to navigate or provide information
Predictive dialing – automatically dials outbound calls and when someone answers, the call is forwarded to an available agent
3. Describe three ways an organization can perform CRM functions over the Internet
Intranets are a great way to provide information to important customers over the Internet. Organizations can push information to their customers with s discussing new promotions and sales. Offering a Web site that is user friendly is one of the best ways to offer customer support and sales over the Internet.
4. How will outsourcing contact centers (call centers) to Canada change as future CRM technologies replace current CRM technologies?
CRM future trends include:
CRM applications will change from employee-only tools to tools used by suppliers, partners, and even customers
CRM will continue to be a major strategic focus for companies
CRM applications will continue to adapt wireless capabilities supporting mobile sales and mobile customers
CRM suites will incorporate PRM and SRM modules