Suggestions – CRM Strategy
The traditional telecom companies which had acquired a large number of first time customers would now have to focus on retaining these as well as have advocates for new buyers. Thus these could be either in the first or second phase of relationship management. This is also confirmed by a number of studies examined in the literature survey as well as the customer appraisal carried out. China Telecom, Unicom and China Mobile will thus need to invest heavily in CRM in the future. The first stage of CRM implementation by companies is operational which includes a detailed business environment analysis.
Standard measures such as PEST analysis or Five Forces Frame work can be used in the initial stages which could be later followed up by more rigorous processes with the help of consultants as well as software. A full spectrum analysis of the customer should be carried out only through tailor made software for the purpose. Having fully understood the client, interacting with him once again with this greater knowledge and perhaps affinity will be essential which is a part of the collaborative CRM process is.
For high value clients the concept of knowledge based client relationship is recommended to provide value
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Over the years having built large capacities, these are likely to attempt to attract customers in each others niche segments fixed and mobile with different technologies. One strategy would be to target each customer segment with an optimum technology; however CRM will have to be build into this model. Communications companies have a major advantage in CRM as they have a captive transmission capability in telephones, both mobile and fixed line as well as broadband internet and other means. This eases the basic problem which most organizations have in effectively reaching the customer.
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However it also needs consideration that the Chinese customer at present is more comfortable with person to person rather than machine interface, which may necessitate deployment of a large quantum of manpower by companies for this purpose. A balance can be achieved by ensuring that all high value customers are provided dedicated relationship services while others may be addressed collectively depending on the amount of resources that the company decides to deploy. China does have a high penetration of the internet hence internet media can enable linkages with a large proportion of the clientele.
Customer transfer is considered a major issue in CRM and this has been proved by the Chinese example as approximately 40 percent of the clients are said to be in the transitory mode. It is essential for companies to ensure that the loyalty of this segment is secured at the earliest while some more aggressive companies will even attempt to capture the customers turning over from other companies. In the Chinese environment, the importance of CRM is further highlighted by the large number of cultural diversities in the country varying from one geographical region to another.
Thus the general strategies may have to be readapted to suit the local conditions. Ultimately Chinese telecommunications companies have to ensure that CRM is used as a strategic tool to balance the capabilities addressed by technology, people, processes and knowledge to serve the customer, win him over and establish long lasting relationship. Those companies which are able to do so will survive and those who fall to the temptation of neglecting this essential facet will not be able to grow and may even face closure. Three external factors are seen to greatly affect Chinese telecommunications market in the future.
The first is introduction of 3 G technologies. This will increase the pressure on companies for CRM as the customer will have to be provided a full spectrum of capabilities and till he is used to adapt to them and is able to enjoy them, the challenge of CRM will remain very high. MII has already started increasing the scope for using advanced technologies; hence this issue may need to be addressed urgently. A second aspect is that of increased regulation which will end monopolies and provide a level playing field for the four companies, this will also increase the level of competition.
With the saturation of technology it is felt that the focus will be on CRM to acquire new customers and retain existing ones. An infusion of foreign capital also implies that there will have to be greater accountability and responsibility on the part of the companies who will be answerable to a more responsive stake holder. This will increase the need for results. In addition falling rate of growth in the context of ever increasing capacities implies that unless additional customers are acquired, capacity utilization will only be marginal. Thus indicating the enhanced the scope for CRM.
Conclusions from the Siemens Case study also indicate that the Chinese telecommunications industry can demonstrate high levels of growth through infusion of CRM in a systematized manner. Providing a company wide focus by adoption of CRM as a strategy is the first step followed by a detailed survey to understand the customer needs and then create a common data base for access to all company executives dealing with the customer. CRM is a people oriented process hence it is essential that the right type of personnel are selected and they are provided appropriate training in the common values established by respective companies.
Those adopted by Siemens as covered in the case study could perhaps act as guide lines for above. Their performance needs to be constantly assessed and incentives provided to ensure that they are fully motivated to follow up their training inputs. To implement CRM an organization has to be created so that it can provide accountability and denote responsibility. There is an acceptance of the need for CRM in Chinese companies and a number of them are in the process of setting up dedicated CRM services such as Hunan telecommunication (Local subsidiary of China Telecom in Hunan).
Collaboration with Western companies has been the route invariably followed by these companies. However the level of awareness and operations of such CRM systems is still in its infancy in China and there is a greater scope for enhancement. The essential issue will be to create a CRM culture as at present a number of areas as data capture and utilization is considerably poor. Lack of local expertise, particularly in the software field is creating greater dependence on foreign brands which is invariably being resisted by the Chinese.
The Kotler matrix simulation carried out indicates that the Chinese telecommunications companies are having a high level of customers but low revenues. This indicates that the present CRM level is essentially basic related to product provision and a very primitive follow up related to attendance of complaints. There is a need to graduate to a reactive and thereafter an accountable system of CRM by the companies. While with the high value customers a proactive and partnership model will have to be developed, applying the Kotler matrix to the high income generating customers.