Vol II Issue V Nov 2012 Impact Factor : 0.1870 ISSN No :2231-5063 ORIGINAL ARTICLE Monthly Multidiciplinary Research Journal Golden Research Thoughts Chief Editor Dr.Tukaram Narayan Shinde Publisher Mrs.Laxmi Ashok Yakkaldevi Associate Editor Dr.Rajani Dalvi Honorary Mr.Ashok Yakkaldevi
IMPACT FACTOR : 0.2105 Welcome to ISRJ RNI MAHMUL/2011/38595 ISSN No.2230-7850 Indian Streams Research Journal is a multidisciplinary research journal, published monthly in English, Hindi & Marathi Language. All research papers submitted to the journal will be double - blind peer reviewed referred by members of the editorial Board readers will include investigator in universities, research institutes government and industry with research interest in the general subjects. Flávio de São Pedro Filho Federal University of Rondonia, Brazil Kamani Perera Regional Centre For Strategic Studies, Sri Lanka Janaki Sinnasamy Librarian, University of Malaya [ Malaysia ] International Advisory Board Mohammad Hailat Dept. of Mathmatical Sciences, University of South Carolina Aiken, Aiken SC 29801 Abdullah Sabbagh Engineering Studies, Sydney Catalina Neculai University of Coventry, UK Hasan Baktir English Language and Literature Department, Kayseri Ghayoor Abbas Chotana Department of Chemistry, Lahore University of Management Sciences [ PK ] Anna Maria Constantinovici AL. I. Cuza University, Romania Romona Mihaila Spiru Haret University, Romania Delia Serbescu Spiru Haret University, Bucharest, Romania Anurag Misra DBS College, Kanpur Titus Pop Ecaterina Patrascu Spiru Haret University, Bucharest Loredana Bosca Spiru Haret University, Romania Fabricio Moraes de Almeida Federal University of Rondonia, Brazil George - Calin SERITAN Postdoctoral Researcher Editorial Board Horia Patrascu Spiru Haret University, Bucharest, Romania Ilie Pintea, Spiru Haret University, Romania Xiaohua Yang PhD, USA Nawab Ali Khan College of Business Administration Pratap Vyamktrao Naikwade Iresh Swami ASP College Devrukh,Ratnagiri,MS India Ex - VC. Solapur University, Solapur R. R. Patil Head Geology Department Solapur University, Solapur Rama Bhosale Prin. and Jt. Director Higher Education, Panvel Salve R. N. Department of Sociology, Shivaji University, Kolhapur N.S. Dhaygude Ex. Prin. Dayanand College, Solapur Narendra Kadu Jt. Director Higher Education, Pune K. M. Bhandarkar Praful Patel College of Education, Gondia Sonal Singh Vikram University, Ujjain Rajendra Shendge Director, B.C.U.D. Solapur University, Solapur R. R. Yalikar Director Managment Institute, Solapur Umesh Rajderkar Head Humanities & Social Science YCMOU, Nashik S. R. Pandya Head Education Dept. Mumbai University, Mumbai Govind P. Shinde Bharati Vidyapeeth School of Distance Education Center, Navi Mumbai Chakane Sanjay Dnyaneshwar Arts, Science & Commerce College, Indapur, Pune Awadhesh Kumar Shirotriya Secretary, Play India Play (Trust),Meerut G. P. Patankar Alka Darshan Shrivastava S. D. M. Degree College, Honavar, Karnataka Shaskiya Snatkottar Mahavidyalaya, Dhar Maj. S. Bakhtiar Choudhary Director,Hyderabad AP India. S.Parvathi Devi Ph.D.-University of Allahabad Sonal Singh Rahul Shriram Sudke Devi Ahilya Vishwavidyalaya, Indore S.KANNAN Ph.D, Annamalai University,TN Satish Kumar Kalhotra Address:-Ashok Yakkaldevi 258/34, Raviwar Peth, Solapur - 413 005 Maharashtra, India Cell : 9595 359 435, Ph No: 02172372010 Email: ayisrj@yahoo.in Website: www.isrj.net
Golden Research Thoughts Volume 2, Issue. 5, Nov. 2012 ISSN:-2231-5063 GRT ORIGINAL ARTICLE Available online at www.aygrt.net E-CRM PRACTICES OF INSURANCE COMPANIES IN INDIA KAMAL GULATI Singhania University Pacheri Bari, Distt. Jhujhunu Rajasthan Abstract: KEYWORDS: Customer relationship management in the insurance industry is in the nascent stage. Firms are framing new strategies to combat stiff competition. Public and private insurance companies are implementing customer relationship programs to attract more customers and retain existing customers. The objective of the study was to study the e-customer relationship management program of the insurance sector in India. Four companies were taken namely Life Insurance Corporation of India, ICICI Lombard, Oriental Insurance Co Ltd. and Max Life Insurance company. The study also focus on effectiveness E-CRM program in insurance sector in India. This study is based on the opinion scores of 182 policyholders of Life Insurance Corporation of India, who have been with the company for more than the last five years. Based on the average opinion scores before and after the implementation of the Customer Relationship Management program, it was concluded that the program is effective, which was evidenced by the results obtained from statistical analysis. E-CRM, General Insurance, Life Insurance. INTRODUCTION : As the Internet is becoming more and more important in business life, many companies consider it as an opportunity to reduce customer-service costs, tighten customer relationships and most important, further personalize marketing messages and enable mass customization. ECRM is being adopted by companies because it increases customer loyalty and customer retention by improving customer satisfaction, one of the objectives of e-crm. E-loyalty results in long-term profits for online retailers because they incur less costs of recruiting new customers, plus they have an increase in customer retention. Together with the creation of sales force automation (SFA), where electronic methods were used to gather data and analyze customer information, the trend of the upcoming Internet can be seen as the foundation of what we know as e-crm today. As we implement e-crm process, there are three steps life cycle: 1.Data collection: About customers preference information for actively (answer knowledge) and passively (surfing record) ways via website, email, questionnaire. 2.Data aggregation: Filter and analysis for firm's specific needs to fulfill their customers. 3.Customer interaction: According to customer's need, company provide the proper feedback them. e-crm can be defined as activities to manage customer relationships by using the Internet, web browsers or Golden Research Thoughts Volume 2 Issue 5 NOV. 2012
other electronic touch points. The challenge hereby is to offer communication and information on the right topic, in the right amount, and at the right time that fits the customer's specific needs. The e-crm or electronic customer relationship marketing concept is derived from e-commerce. It also uses net environment i.e., intranet, extranet and internet. Electronic CRM concerns all forms of managing relationships with customers making use of information technology (IT). ecrm is enterprises using IT to integrate internal organization resources and external marketing strategies to understand and fulfill their customers needs. Comparing with traditional CRM, the integrated information for e-crm intra organizational collaboration can be more efficient to communicate with customers. The ecrm or electronic customer relationship marketing concept is derived from e-commerce. It also uses net environment i.e., intranet, extranet and internet. Electronic CRM concerns all forms of managing relationships with customers making use of information technology (IT). ecrm is enterprises using IT to integrate internal organization resources and external marketing strategies to understand and fulfill their customer's needs. Comparing with traditional CRM, the integrated information for ecrm intraorganisational collaboration can be more efficient to communicate with customers. Implementing and integrating E-CRM work Non-electronic solution Several CRM software packages exist that can help companies in deploying CRM activities. Besides choosing one of these packages, companies can also choose to design and build their own solutions. In order to implement CRM in an effective way, one needs to consider the following factors: Create a customer-focused culture in the organization. Adopt customer-based managers to assess satisfaction. Develop an end-to-end process to serve customers. Recommend questions to be asked to help a customer solve a problem. Track all aspects of selling to customers, as well as prospects. Furthermore, CRM solutions are more effective once they are being implemented in other information systems used by the company. Examples are transaction processing system (TPS) to process data real-time, which can then be sent to the sales and finance departments in order to recalculate inventory and financial position quick and accurately. Once this information is transferred back to the CRM software and services it could prevent customers from placing an order in the belief that an item is in stock while it is not. DIFFERENT LEVELS OF E-CRM In defining the scope of E-CRM, three different levels of services are as following: Foundational services: This includes the minimum necessary services such as web site effectiveness and responsiveness as well as order fulfillment. Customer-centered services: These services include order tracking, product configuration and customization as well as security/trust. Value-added services: These are extra services such as online auctions and online training and education. Self-services are becoming increasingly important in CRM activities. The rise of the Internet and E-CRM has boosted the options for self-service activities. A critical success factor is the integration of such activities into traditional channels. An example was Ford's plan to sell cars directly to customers via its Web Site, which provoked an outcry among its dealers network. CRM activities are mainly of two different types. Reactive service is where the customer has a problem and contacts the company. Proactive service is where the manager has decided not to wait for the customer to contact the firm, but to be aggressive and contact the customer himself in order to establish a dialogue and solve problems. RESEARCH METHODOLOGY This study is based on cases of different Insurance companies in India. These companies are namely: 2
1. Life Insurance Corporation of India 2. The Oriental Insurance Company Ltd. 3. ICICI Lombard Ltd. 4. Max Life Insurance Company Ltd. In this study out of four companies two companies are life insurance namely. Life Insurance Corporation of India, Max Life Insurance Company Ltd and two company are Non-Life Insurance namely ICICI Lombard Ltd and The Oriental Insurance companies. DATA COLLECTION: In this study data was collected through secondary source primarily website's of Indian Insurance companies. Interaction was also done with CRM Professionals with these organizations. These CRM practices are based on existing practices and their future plans. In this study observation was confined in National Capital region (NCR). E-CRM IN LIFE INSURANCE CORPORATION OF INDIA Customer Relationship Management consists of activities aimed at ensuring profitability of customers in an organization. Customer relationship management works on the concept of integrating customer management activities in an organization- like customer billing, distribution and shipping, customer service provision, and website utilization. Objective of Customer Relationship Management is to increase acquisition, growth and retention of profitable customers effectively and efficiently by selectively initiating, building and maintaining appropriate relationships with them. Developments in information technology has helped to implement customer relationship programs with ease and make it possible to gather vast amounts of customer data and to analyze, interpret and utilize it constructively. Customer Relationship Management includes many aspects which relate directly to one another: Front office operations: Direct interactions with customers, e.g. face to face meeting, phone calls, e-mail, online services etc. Back office operations: Operations that ultimately affect the activities of the front office, e.g. billing, maintenance, planning, marketing, advertising, finance, manufacturing, etc. Business relationships: Interaction with other companies and partners, such as suppliers/ vendors and retail outlets / distributors, industry networks. This external network supports front and back office activities. Key Customer Relationship Management data can be analyzed in order to plan target- marketing campaigns, conceive business strategies, and judge the success of Customer Relationship Management activities, e.g. Market share, number and types of customers, revenues. Academic research is stressing Customer Relationship Management as a fundamental business process with a significant impact on organization results. Rather, past academic research has been more narrowly focused on sales force automation (SFA). In particular the factors driving acceptance and use of information Technology by the sales force. Various activities are involved for effectiveness of Customer Relationship Management such as: Customer centric process: At the Customer Relationship Management planning stage, companies need to take cognizance of their processes from the customers' viewpoint and make necessary adjustments to enable higher customer facilitation. All processes that involve customers should be taken into account. Internal Collaborations: The Customer Relationship Management initiative should facilitate the collaboration process through the proper use of technology. An important aspect that needs to be considered is the resolution of ownership issues and boundaries across departments Designing databases carefully: Use of database is an integral part of Customer Relationship Management initiatives. The data that is collected should enable prediction of customer behavior with reference to propensity-to-buy, risk of churn, product affinity, and analysis of the data should enable opportunities for cross-selling and up-selling. E-CRM IN ICICI LOMBARD TalismaTM, a provider of multi-channel CRM solutions, announced that its solution has been deployed by ICICI Lombard, a leading provider of customized insurance solutions. Talisma v6 will provide ICICI Lombard's customers with enhanced customer service through quicker and more accurate claims processing. ICICI Lombard customer service representatives now have a single-screen view that provides a 360-degree perspective and complete audit trail of each customer enquiry. This enquiry includes contact information, customer profiles, appointments, and service queries, regardless of communication method 3
(chat, email, or phone). 7 Essential Steps When Considering CRM For many advisers, choosing a specific customer relationship management technology can be a challenge. There are hundreds of CRM systems, and more than a dozen are focused specifically on financial planning practices. So where do you start? While it can be tempting to choose a CRM system based on the cost and list of features, you need to take a step back and consider your practice from a broader business perspective. Here are seven essential questions for you to answer to make sure your CRM investment gives you a great return. 1)Business objectives: Software that allows you to easily create professional e-mail templates can be exciting, but it doesn't do you any good if it doesn't help you achieve your objectives. List your business objectives and make sure they are clear and measurable. 2)Processes and CRM impact: Even before you decide to buy the software, consider your current customer relationship strategies and processes. How do you currently handle contact information? What is your process for preparing for client meetings? How do you communicate with your clients? Understanding what could be impacted can help you identify areas you want to adjust, change or keep intact once the software is installed. 3)Gains from implementing CRM: Clearly identify what it is you expect your CRM to ultimately give you. Is it scalability to help you serve more clients, or efficiency in daily tasks so you can spend more time prospecting to increase revenue? These gains should relate to achieving your overall business objectives, but should also be very specific and relate directly to your anticipated use of CRM. 4)Features and functions are critical to achieving objectives: Once you have answered the questions above, you can use that collective information to help identify the functions you need in a CRM system. 5)Incentives and measurements to support the adoption of CRM: Before you purchase and install a CRM system, you need to consider how you will motivate your staff to use the software. If it takes your assistant an extra 20 minutes to input complete client information into the software, he or she will need to understand how this extra work benefits the entire practice in the long run. It may also be appropriate to award him or her in some way for taking on additional work. 6)Evaluation and improvement in business processes: It is important to know if you are actually getting the value you want and need from your software purchase. To that end, identify who will evaluate the software and any gains (or losses) you have received from using the software on an ongoing basis. This individual can also be tasked with identifying new ways to improve your process that can save you time and money. 7)Customization of E-CRM: Now that you know what you need the CRM software to do for you and how you are going to ensure return on your investment, you can evaluate the various CRM options available in light of how the software will improve your business. E-CRM IN MAX LIFE INSURANCE E-CRM is the process of carefully managing detailed information about individual customers and all customers touch points to maximize customer loyalty. A customer touch point is any occasion on which a 4
customer encounters the brand and product-from actual experience to personal or mass communications to casual observation. Max Life Insurance Company has also undertaken various steps to strengthen its customer relationship management. Max Life Insurance Company has undertaken various steps to strengthen its customer relationship management (CRM). Max Life Insurance has announced the introduction of INTERACTIVE VOICE RESPONSE (IVR) service in 10 different languages. The leap is in a bid to enhance and improve Max Life's customer and distributor experience by availing the customer service in their own language. "This initiative is yet another step towards improving customer satisfaction by enhancing their ease of resolving pre and post policy issues. At Max Life, we lay emphasis in interacting with our customers and distributors in their choice of language. E-CRM IN ORIENTAL INSURANCE COMPANY LTD. CRM is also a customer focused business strategy that aims to increase customer satisfaction and customer loyalty by offering a more responsive and customized service to each customer. CRM technology initiatives are most commonly implemented in functional areas such as customer support, service, sales and marketing to optimize profitability and revenue. CRM is about managing customers for better understanding and to serve them. It is an umbrella concept that places the customers at the centre of an organisation. Customer service is an important component of CRM; however CRM is also concerned with coordinating customer relations across all business functions to retain the customers for long range. KEY CRM PRINCIPLES IN ORIENTAL INSURANCE: 1. Differentiate Customers: All customers are not equal; recognize and reward best customers disproportionately. Understanding each customer becomes particularly important. Besides for the same product or the service not all customers can be treated alike and CRM needs to differentiate between a high value customer and a low value customer. What CRM needs to understand while differentiating customers is: - Sensitivities, Tastes, Preferences and Personalities - Lifestyle and age - Culture Background and education - Physical and psychological characteristics 2. Differentiating Offerings - Low value customer requiring high value customer offerings - Low value customer with potential to become high value in near future - High value customer requiring high value service - High value customer requiring low value service 3. Keeping Existing Customers Grading customers from very satisfied to very disappointed should help the organisation in improving its customer satisfaction levels and scores. As the satisfaction level for each customer improve customer retention in the organization. There are two important issues in handling existing customers a.) Maximizing Life time value b.) Increasing Loyalty. RESULTS AND DISCUSSION By implementing CRM in organization, it leads for brand popularity, innovative product delivery, quick and honest response, building customer relationship through electronic mode and financial security. As far as effectiveness of factors across organizations is concerned, all the factors are proved to be the responsible and essential factors by delivering financial security and innovative products to the target customers and building the honest relationships. So it is fact that, all the undertaken insurance companies 5
are getting success by practicing the above factors. So it is fact that, brand popularity and financial security are two most responsible factors for insurers, by which they can create satisfaction among customers. For private and public sectors Insurance Companies, all the above factors are proved to be the responsible factors. There are few common practices of Electronic CRM in India are as Customization, Aliening with Business Objectives, Evaluation and Integration of Business Process, Dissemination of E-CRM knowledge to all stake holders, Sales Force Automation (SFA), Intelligent use of Data and technology and retaining the existing customers by high level of services to customers. CONCLUSION CRM will be able to manage the huge database of customers. Also will facilitates the online customer interaction for the sake of quick access, better service and delivering right offers at right time to the right customers. CRM implementation is also a cost effective and time saving activity, which will provide the long range solutions to the insurance players in the market. Thus, the need to integrate customer data from multiple channels, to increase sales force productivity, raising service standard, customer satisfaction, loyalty of customers, CRM software's and ITES Information Technology Enabled Services will be always in demand. BIBLIOGRAPHY Buttle, Francis (1999), The S.C.O.P.E. of Customer Relationship Management. International Journal of Customer Relationship Management 1 (4), 327-337. Gefen D. and Ridings C.M., Implementation team responsiveness and user evaluation of customer relationship management, journal of management information system, 19, 47-69 (2002) Kellen, Vince (2002). E-CRM Measurement Frameworks. http://www.kellen.net/crmmeas.htm. Cunningham, Colleen, Il-Yeol Song, Jin Taek Jung and Peter Chen (2003), Design and Research Implications of Customer Relationship Management on Data Warehousing and CRM Decisions. In Proceedings of the 2003 Information Resources Management Association International Conference (IRMA 2003), 82 85. Jain, Dipak and Singh, Siddhartha (2002). Customer Lifetime Value Research In Marketing: A Review and Future Direction. Journal of Interactive Marketing 16 (2), 34-46. Janny.C.Hoekstra, Eelko.K.R.E.Huizingh, The Lifetime Value Concept in Customer-Based Marketing, Journal of Market Focused Management [M], 3, 1999, 257-274. Peter C. Verhoef, Bas Donkers, Predicting customer potential value an application in the insurance industry, Decision Support System[M], 32, 2001, 189-199. K. B. S. Kumar, Insurance Customer Service, Hyderabad: The ICFAI University Press, 2006. 3 pp, 23 pp and 18 pp. Sameer A. Zodgeekar and Ravi Kant S. Wawge, Micro Insurance-Global and Indian Scenario, Hyderabad: The ICFAI University Press, 2008, 202pp. Ramsey, S. (2003). Introduction: Strategy First, Then CRM. In John Freeland (Ed.). The Ultimate CRM Handbook: Strategies and concepts for building enduring customer loyalty and profitability. McGraw-Hill. P.13 WEBLIOGRAPHY http://www.irdaindia.org http://www.insuranceandtechguide.com http://www.crm4insurance.com http://www.crminfoline.com/crm-articles/crm-insurance.htm http://www.licindia.in http://www.maxlifeinsurance.com http://www.icicilombard.com http://www.orientalinsurance.org.in 6
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