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Chapter 10 SCM CUSTOMER RELATIONSHIP MANAGEMENT

CRM DELIVERS PRODUCTS AND SERVICES:
Why
to achieve high levels of customer satisfaction
CRM DELIVERS PRODUCTS AND SERVICES:
How
-can use automated transactions
-strong communication by talking to customers
-understanding behavior and needs
CRM DELIVERS PRODUCTS AND SERVICES:
Helps
a system to satisfy requirements
CRM’s Role in SCM
-Create methods to find and develop good suppliers
-Companies must becoming & staying good suppliers themselves.
-Companies may have to certify suppliers to adequately represent their firm’s products.
Key Components of CRM
Segmenting Customers
Target marketing efforts
Relationship marketing
Cross selling
Predicting Customer Behavior
Customer Defection Analysis
Customer Value Determination
Personalizing Customer Communications
Event based Marketing
Segmenting Customers
Group customers to create specialized communications about products
Target marketing efforts
e-mail or direct mail saves labor & postage, reduces chances of being a nuisance
Relationship marketing
or permission marketing – customers select type & time of communication
Cross selling
Additional products are sold as the result of an initial purchase.
Predicting Customer Behaviors
forecast likelihood of purchases
Customer Defection Analysis
finding methods to retain customers
Customer Value Determination
verify the customer lifetime value
Personalizing Customer Communications
Understanding customer behaviors & preferences.
-Clickstream, learn how a customer navigates a Web site
Event based Marketing
offer the right products & services to customers at the right time
Sales Force Automation (SFA)
Used for documenting field activities, communications with home office, and sales history
-Sales Activity Management
-Sales Territory Management
-Lead Management
Sales Activity Management
Tool offering sales reps a guided sequence of sales activities
Sales Territory Management
Sales managers obtain information of each sales rep’s activities.
Lead Management
Sales reps follow prescribed tactics when dealing with prospects to aid closing a deal.
Managing Customer Service Capabilities
-What does customer service actually mean?
-“Seven Rs Rule”
-Performance measures are often designed around satisfying the seven Rs.
“Seven Rs Rule”
having the right product
in the right quantity
in the right condition
at the right place
at the right time
for the right customer
at the right costs
Customer Service Elements
-Pre-transaction
-Transaction
-Post-transaction
Pre-transaction elements
Know the customer service policies, the mission statement, org. structure, & system flexibility)
Transaction elements
During the sale include the order lead time, the order processing capabilities and distribution system accuracy
Post-transaction elements
After the sale warranty repair capabilities, complaint resolution, product returns, & operating information
Call Centers
-Can categorize calls
-Determine average resolution time
-Forecast future demand
-Improve the overall productivity of the staff
-Increasing customer satisfaction levels
Additional Components of CRM
-Website Self-Service
-Field Service Management
-Measuring Customer Satisfaction
-Customer Privacy Capabilities
Website Self-Service
Web sites act as support mechanisms Customers can access account information, operating hours, contact information.
Field Service Management
Customers communicate directly with product specialists and a diagnosis can be made quickly
Measuring Customer Satisfaction
Customers are given opportunities to provide feedback about a product, service, or organization
Customer Privacy Capabilities: Two important issues are
ability to assure privacy & ability to minimize customer harassment
6 Steps To A Successful CRM Program
Step 1 – Creating the CRM Plan:
Step 2 – Involve CRM users from Outset
Step 3 – Select the Right Application & Provider
Step 4 – Integrate Existing CRM Applications
Step 5 – Establish Performance Measures
Step 6 – Providing Training for All Users
Step 1. Creating the CRM Plan:
-Objectives of the CRM program
-CRM’s fit with corporate strategy (mission, vision, value
-New applications to buy or developed
-Integration or replacement of legacy systems
-Personnel Requirements- training, policies, -Upgrades, and maintenance
-Costs & time frame for implementation
Step 2 – Involve CRM users from Outset
-Employees should understand how it affects their jobs
-Create a project team with members from all affected organizational areas.
-Test with a pilot application
Step 3 – Select the Right Application & Provider
-Find appropriate application, determine extent of customization
-Visit trade show, read trade literature, hire consultant.
-Compare systems based on performance, security, reporting capabilities, system availability.
Step 4 – Integrate Existing CRM Applications
CRM can be a collection of various applications implemented over time.
-Customer contact systems need to be coordinated allowing all users to know the activity associated with each customer.
-Centralized database or data warehouse containing all customer information.
Step 5 – Establish Performance Measures
– Allows a firm to:
Determine if objectives have been met
Compare actual to planned variance
Step 6 – Providing Training for All Users
-Provide training for all users, then provide ongoing training as applications are added.
-Training also helps convince users like sales, call center, & marketing personnel of the benefits of CRM applications
CRM Issues
1. Customer data privacy
2. Social Media
3. Cloud Computing (Software as a Service)
Customer data privacy
Rules & laws regarding invasion of privacy include Patriot Act in the US and Internet Privacy Law in the EU
Social Media
Creating and cultivating virtual communities around product or brand a powerful way to engage consumers
Cloud Computing (Software as a Service)
-Ala carte & on demand offerings accessed via web browser
-Changing the cost structure of applications

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