Customer Relationship Management Process - A way to increase customer satisfaction

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1 90 Customer Relationship Management Process - A way to increase customer satisfaction, Professor, MITCOE CMSR, PUNE. Abstract: - Satisfaction plays very important role in each and every business. It may be related to employees or customers. Once the individuals get value according to their expectations and requirements, they will form positive attitude. If the benefits are continuous to provide adequate outcome or performance of products or services to the customers they will be more satisfied, due to which organization will be able to achieve the objectives. Organizations needs to be more specific in the overall process to develop one to one healthy and strong relation with their customers. This conceptual research paper focuses on how the process of customer relationship management is useful in developing the business and to improve the level of satisfaction for the customer. Keywords: - Satisfaction, Expectations, Process and Customer Relationship Management. Introduction:- Customer relationship management is playing important role in magnetizing the attention of corporates and scholars in satisfying the customers. More companies are embracing customer-centric strategies, programs and technology for executing efficient and effective customer relationship management process. Companies want their customers to be happy; it is rational to think that happy customers would behave in a way that would benefit the company. Relationship marketing has an objective to build long term, mutual satisfying relations with customers, suppliers and distributors in order to earn and retain their long-term preference and businesses (Kotler, 2000). As a result, business leaders find it difficult to justify spending valuable company resources on tracking customer satisfaction. Many studies, however, provide substantial evidence to suggest that the strength of a company s customer relationships, as measured through customer satisfaction, is an important indicator for business performance. High customer satisfaction has been shown effects on company s different factors like: Improving customer satisfaction Increasing customer retention. Reducing price sensitivity. Increasing cross -selling reception. Increasing referrals and contacts. Increasing purchase intentions. Reducing customer complaints. To obtain above mention factors, organizations should follow the process in which there should be proper coordination between all the activities that will lead to fulfill the requirement of the customers hence pull towards satisfaction. Customer satisfaction provides an indication of how successful the organizations are providing products and services to the potential customers. Organizations need to retain the existing customers and invite new customers. For this purpose they have to follow the effective and efficient process of customer relationship management. This study is able articulates appropriate path to enhance the customer relationship marketing and customer satisfaction.

2 Review of Literature. Customer relationship marketing is one of the best contemporary marketing strategies for all companies to satisfy their customer needs and wants. From organization point of view, trust, commitment, mutuality and long-term relationship with customer are the essential factors to satisfy customer needs and wants. Customer relationship marketing concerns attracting, developing, and retaining customer relationship (Berry and Parasuraman 1991). The study was undertaken by Dr. T.Venampy & S.Sivesan on customer relationship marketing and customer satisfaction -A Study on Mobile Service Providing Companies in Sri Lanka. In this paper the researcher finds that the mobile service providing companies in Sri Lanka have more intense competition. The competition amongst the companies is not focused only on infrastructure (network, tower) but also effective service provision by investing a bulk amount.the major findings of this paper are, there is significant impact of functionality of service in service quality on customer satisfaction and priority should be given to reduce customer dissatisfaction, improve service to retain and increase customer loyalty. The study was undertaken by Dr. Tauseef Ahmad & Dr. Omar A.A. Jawabreh on Impact of Customer Relationship Management of Hotel (A Case study Umaid Bhwan). The results shows that there is impact of implementing customer relationship management to increase the customer trust in Umaid Bahwan as the employee have develop a good repo, customers feel confident while dealing with the customers. Umaid Bahwan hotel implements customer relationship management in its management activities with a medium degree, where services are updated to meet customers need. There is flexibility in hotels services. The staff knows how to solve customer problems and tackle with customer s demands and queries. The researcher tries to define the relation between customer relationship management and customer retention by updating with new services available, there is a continuous contact from the hotel side Umaid Bahwan with a medium degree, where the hotel keeps customer. In research paper Customer Satisfaction towards Honda Two Wheelers: A Case Study in Tirupati by Dr. Duggani Yuvaraju & Prof. S. Durga Rao, the findings were that 90 % of the respondents were happy about the mileage and performance of Honda two wheelers,more than 50 % of the respondents give preference to Honda due to quality service provision. The researcher tries to find out customer relationship marketing will be more effective when the process can be achieve by providing quality bikes and effective service provision. Mahapatra, kumar and Chauhan (2010) mentioned a study on "customer satisfaction, dissatisfaction and post purchase evaluation: an empirical study on small size passenger cars in India" with the main objectives to examine the satisfaction and impact on future purchase decision and explore the performance of different attributes in automobile in giving satisfaction to customer with the sample size of 150 customers and they used the multiple regression techniques and they revealed from this study that customers are highly satisfied with the performance of attributes like pickup, wipers, etc. and other attributes like pollution, engine, quietness, battery performance, and pick up influence the consumer future purchase decisions and consumer give the more importance to these factors III. RESEARCH METHODOLOGY This is a conceptual research with explorative methodology. The secondary data was collected from different authentic sources like textbooks, research papers, articles, newspapers and internet etc. This study was made to have an overview of customer relationship management process to enhance 91

3 customer satisfaction. While performing each and every step the organizations should strive towards the customer s satisfaction which will be beneficial for both. Objectives:- 1. To study the importance of customer relationship management process for increasing customer satisfaction. 2. To understand in detail process of customer relationship management conceptually. IV. Conceptualization CRM process comprised of the sub-processes as follows : a customer relationship formation process; a relationship management and governance process and its evaluation. CRM Formation Process Customer Relationship formation Process Customer relationship management (CRM) is a complex process, refereed by a set of different types of CRM viz. operational, analytical and collaborative CRM. With the help of information technology, organizations can focus on creating two-way exchange with customers so that firms have an intimate knowledge of their needs, wants, and buying patterns of customers. In this way, customers relationship management helps companies to understand, as well as anticipate, the needs of current and potential customers. CRM process will support the business to execute the activities like sales, marketing, providing effective and efficient customer service, human resource development, and compensation. CRM process should acknowledge that relationships evolve with distinct phases (Dwyer, Schurr and Oh 1987).Thus we can view CRM process as a longitudinal phenomenon. Firm should interact with customers and manage relationship differently at each stage (Srivastava, Shervani and Fahey 1998) In today s commercial world, practice of dealing with existing customers and flourishing business by getting more customers into loop is predominant and is mere a dilemma. Installing a CRM system can definitely improve the situation and help in challenging the new ways of marketing and business in an efficient manner. Hence in the era of advancement business every organization should be recommended to have a full-fledged CRM system to cope up with all the business needs. By adopting full proof process, the firms can achieve the objective of providing satisfaction to the customers. The first requirement for the successful implementation of CRM is clarity regarding CRM process terms. From the many approaches available, the distinction between the following three areas has become generally accepted. When it comes to application of CRM, three broad classifications based on their role in overall process of customer relationship management are explained in detail as follows Operational CRM:- Operational CRM generally refers to services that allow an organization to take care of their customers with the help of available recourse like information technology, sales force team to do follow-up, for generating leads, for promotional communication. It provides support for various business processes, which can include sales marketing and service. Contact and call centers, data aggregation systems and web sites are a few examples of operational customer relationship management. If your company has a high customer turnover, or perhaps high service costs, Operational CRM is a tool that can help you solve your problems. The high tech expertise of CRM gives you access to information about your customer as well as giving you a clear view of your customer s needs. Operational integration points exist to human resource systems for user data and 92

4 ERP systems for transferring order information which was captured e.g. from a call center representative. From an operations perspective, Bose pointed out that CRM is an integration of technologies and business processes that are adopted to satisfy the needs of a customer during any given interaction. Analytical CRM: - Analytical CRM builds on operational CRM. It extracts information from a centralized data warehouse which is consolidated data based on certain criteria (e.g. sales and services). It is useful for managing and evaluating customers for segmenting the customers into different category. Here the data mining tool analyses defined dimensions e.g. compares the characteristics of one customer with another, leading to the determination of a customer segment and thus providing the basis for targeted marketing campaigns. It determine profitability or which customers generally lead to the most profit over time, it also provides the ability to market specifically to individual customers based on the data collected. Analytical CRM can help company to compare success based on the customer knowledge database. Over time, the analysis helps with business decisions founded on earlier analysis. When it comes to sales, marketing and services, the benefits of CRM analytics are many and usually lead to better and more productive customer relations. Rather than struggling to find out find out new customers, it is better to retain the present customers. With CRM analysis, organizations will know which customers will be the more loyal customers and how to find them more quickly and efficiently. Collaborative CRM: - Collaborative CRM is the important aspect of the customer relationship management process. It is the form of CRM in which the organizations are combining the efforts of operational and analytical CRM. Collaborative CRM a highly effective method of communication as it covers direct interaction with customers including feedback and issue reporting. Interaction can take place through web pages, and Automated Voice Response. As an important approach to customer relationship management, Collaborative customer relationship management. CRM greatly improves on services offered and addresses such issues as sales, technical support and marketing. As a dynamic tool it allows a business to share any information collected from interactions with customers. By way of example, as a company you might want customer feedback that is gathered from a technical support session, which could inform your marketing staff about services of interest to customers. Overall, the primary purpose of Collaborative CRM is to improve the quality of customer service and to increase customer satisfaction. CRM Governance Process and its evaluation. Good governance refers to the process of undertaking decisions and actions consistent with the principles of functionality, transparency, accountability and customers participation will leads to customers satisfaction. To administered and manage the individual relationship with each and every customer, programs should be developed to increasing the customer s satisfaction. The governance process is an ongoing process. It should vary according to the size of the market and the variation in the customer life cycle. The governance process structure should establish the guidelines and procedures for its own operations. This includes regular meeting intervals, formal communication mechanisms for achieving the set targets. In this process organizations should plan and execute the activity to achieve the goals. 93

5 The business-planning phase should include the documentation of high-level CRM business goals in the form of a strategy document or business plan. This stage is to interact with customers and execute the marketing plan so that both the company and its customers get the most out of their interactions. These tools helps organization to execute the customer relationship process to maximize customer satisfaction level. CRM governs process refers to a conceptually broad phenomenon of the business activity. The strategic role of company becomes clear when it defines IT as organizations governance which will lead to convergence between effective use of IT and business strategies. Evolution should be based on the information and the present process applied to achieve the maximum satisfaction level. Companies can enhance their CRM process, if the performance is satisfactory. When performance does not meet the expectations, companies can modify the present process and adopt the better one which will results in improving the relationship. Conclusion CRM is therefore understood as a customer-centric management approach where information systems provide information to support operational, analytical and collaborative CRM processes and thus contribute to customer profitability and retention. While potential benefits are attractive. CRM implementation must be managed carefully to deliver results. To cope up with the cut throat competition, companies needs to follow the strategic process. The result of observing keen collaborative CRM process leads to better service, builds greater customers satisfaction, and further improves the relationship and the company s results. Hence it can be concluded that a proper customer relationship management will bring greater customer delight. References:- 1. Atul Parvatiyar & Jagdish N. Sheth, Customer Relationship Management: Emerging Practice, Process, and Discipline Journal of Economic and Social Research 3(2) 2001, Abhiymanyu Verma, Customer Relationship Management-A Viable Strategy for Global Success Asia Pacific Journal of Marketing and Management Review 2(9) 2013, Timothy Keiningham, Sunil Gupta, Lerzan Aksoy and Alexander Buoye, Magazine: Spring 2014Research Feature 4. Dr.Duggani Yuvaraju & Prof.S.Durga Rao, Customer Satisfaction towards Honda Two Wheelers: A Case Study in Tirupati IOSR Journal of Business and Management 16 (5) May 2014, Dr. T.Venampy & S.Sivesan, Customer relationship marketing and customer satisfaction -A Study on Mobile Service Providing Companies in Sri Lanka Global Journal of Management and Business Research 12(18) Ver Dr. Tauseef Ahmad & Dr. Omar A.A. Jawabreh Impact of Customer Relationship Management of Hotel -A Case study Umaid Bhwan Asian Journal of Finance and Accounting 4(1) June F. Rajola Customer Relationship Management in the Financial Industry, Management for Professionals, Springer-Verlag Berlin Heidelberg