CRM is a enterprise-wide initiative as it aims at integrating the front end customer facing system with the back end

system that actually deliver the product & value to the system. Defining a CRM strategy involves not only the top management but also the enterprise as a whole with all functional areas. A CRM implementation requires change management because almost all aspects of a business viz., processes, goals, orientation, focus technology, performance & effectiveness metrics are subject to change.

Usually, an implementation team is formed that has representation from all the functional areas of the enterprise. CRM implementation road map helps a firm to develop a positive cultural acceptance of CRM. The different stages of a CRM implementation road map are shown as in the next slide.

Scenario Analysis Purpose & objective Business Planning Process Design Technology & vendor selection Solution Development Implementation Measurement

The planning phase includes documentation of high level CRM business goals in the form of business document that becomes the focal point for strategy development. There are five interrelated areas that are subject to changes. These include:Business Focus Organizational Structure Business Metrics Marketing focus Technology

    

In this stage firms should take a hard look at the changes liable to happen & prepare for it. Communication is extremely critical & vital during this stage.

Most organizations usually adopt a requirements driven approach towards identifying the relevant solution. Define the business problem & determine what need to be done to solve the problem. This may mean identifying the relevant processes that need to be revamped using technology as the driver. Specify the functionality to meet the specified requirements. Also requires to identify different aspects off the customer focused processes that need to be supported with technology. Define the products that support the identified functionality.

Although there are many firms offering CRM solutions in the marketplace, a firm might also look at developing their own CRM systems under the following situations:1. They require core CRM capabilities that can not be provided by products that exists in the market at that moment. 2. Off the shelf packages might be perceived as too expensive. However many firms are offering products for small & medium-sized firms. 3. A single CRM product can not provide the corefunctionalities required by the firm. 4. The firm wants a unique product that the competitors can not use & vendors can not refer to develop such other products

Functionality Flexibility to incorporate changes Customization Scalability Fit with existing architecture(Legacy systems) Fit with global best practices Upgradability Commercial impact (Lifetime cost of CRM package) Compatibility with other CRM solutions Degree of integration (with back end data warehouse)

CRM expertise Implementation experience Focus of the vendor on CRM Credentials of the vendor including financials, client list, life history etc. Preferred implementation partners if the vendor is not able to provide the service. The vendor's understanding of the firms business problems & pressing needs.

Cost & time Any surprises that may come up during implementation Promised features as against the actual features Vendor involvement during implementation Quality of the end user training Quality of customization Post implementation support Experience with the product.

Relationship marketing Internal Marketing Customer Defection Customer Retention Plans

Firms can profit from their current customers through customer portfolio analysis, customer retaining mix & reorganization for customer retention.

Before developing customer plans or reward programs, a firm need to know the purchasing history of a product or firms customers. A customer portfolio is a combination of customer types for each product that generate sales & resulting profit. An optimal customer portfolio consists of a balance of new and repeat customers yielding target sales & profits

The design of a portfolio begins by seeking meaningful customer classifications based on Market research of actual purchase patterns. The portfolio segments can be measured in terms of number of customers, number of purchases, demographic & psycho graphic profiles & contribution to sales & profits.

Customer Categories First time customers Repeat customers Switched away, then returned Last time(Defectors) Total

Actual Sales (2004) 28% 40% 10% 22% 100%

Target Sales (2005) 25% 60% 5% 10% 100%

An important factor that frequently contributes to the loss of customers is the lack of Organizational control & coordination. This problem takes two forms 1. Lack of sensitivity to customer turnover rate 2. An insufficient linkage between the marketing function & the operations group.

Product Extra Reinforcing Promotions Sales Force Connections Specialized Distribution Post Purchase communication