CRM Cycle

CRM Cycle
1 An Assessment Phase Knowledge acquisition portion of the process
2 A Planning Phase The creativity of the marketing process
3 An Executive Phase Maps to the customer interaction element
 An Assessment Phase
Analysis of the data will require tools such...
OLAP – Online Analytical Processing
Data mining
CHAID – CHI squared automated induction
CART – Classification and regression trees
 A Planning Phase
 How best to approach the customers
 Less dependent on technology
 Creative part of marketing
 An Executive Phase
 Organization puts all his knowledge to work
 Two dimensions
• Execution & Management of marketing campaigns
& customers treatment strategies
• Tracking of responses


Business Drives of CRM
Competition
Economic of customer retention
Technology
CET


Three ways to increase the profitability of a customer base
Acquire more customers
 Most expensive
 5 to 10 times then the retention an existing once
Optimize the value of existing customers
Retain the right customers longer


Armed with effective customer relationship management, a
company should
Prevent overspending / under spending
Without spending improvement
Identifies the current channel
Deliver the right product / service at right time
Improve marketing return on investment


An Architecture for developing CRM
An Architecture – a blue print
The data warehouse is the technology & infrastructure
heart of the architecture.
Various analytical tools
OLAP – Online analytical program
Data mining
Statistical analysis

Electronic Customer Relationship Management [E-CRM]

Electronic Customer Relationship Management [E-CRM]

CRM is journey of
Strategic – Process – Organizational – Technical Change
 CRM comprises the acquisition & deployment of knowledge about
customers to enable a company to sell more of their product or
services more efficiently.
 CRM ensures that individual customer needs are profitable satisfied at
the right time in the right channel with the right offer.
 Two cornerstones of CRM.
The knowledge or customer information platform.
The customer interaction platform.
 CRM is the process of …
Acquiring, retaining & growing profitable customers.
 To be effective in managing the customer relationship, an organization
must….
Define its customer policy
Create a channel & product strategy
Understand the importance of a robust and integrated
infrastructu

Strategies of Evolution of CRM
Mass Marketing
Target Marketing
Customer relationship Management
 Mass Marketing
Replaced intimacy of direct sales force
This has been occurred because of...
 Centralized large scale production
 Wide geographic distribution
 One way communication
This has been enabled through...
 TV, Radio, Printing Press
 Powerful means of communications
Main Measure of Success ---- Market Share
 Target Marketing
1980 -- Advancement in technology
Refinement in direct mail & telemarketing
Selection of specific (targeted) customers via mail or telephone
Direct response of a customer
Gauge of success -- Response rates
Primary measure -- Market Share
 Customer Relationship Management
Moves back towards developing an intimacy with today’s
customer
Two variables...
 First Variable -- Information & Analysis (Knowledge)
• Customer’s wants, Needs & Values
 Second Variable -- Need for interactivity & Personal
contact
Measure -- Share of customers

Anatomy of the CRM Campaign
Database Can contain the existing customers
Find potential candidates for the campaign
Scoring / Scoring algorithm
Telemarketing Outbound Representative makes the calls
Inbound Representative accept the calls

Types of CRM
1) Win back / Save
2) Prospecting
3) Loyalty
4) Cross selling / Up selling
 Win Back / Save
 Process of convenience a customer to stay with the organization
when the customer have / is going to left / discontinue.
 4 times more likely to succeed if contact is made within first
week than it is made in the forth week.
 Prospecting
 Effort to win new first time customer
 3 most critical elements
 Segmentation
• Need based Segmentation – What customer wants
• Profit based Segmentation – How valuable the
customer is
 Selectively
 Sources
 Loyalty
Most difficult to gain accurate measures
 Organization is trying to prevent customers from leaving & uses
3 essential elements
 Value based segmentation
• Willing to invest in retaining a customer loyalty
 Need based segmentation
• Offer a customized loyalty program
 Predictive churn models
• Depending on the future predictions
 Cross Sell / Up Sell
Selling in a way which gives usage to the targeted customers
The replacement of analog line with an ISDN line – Examplere strategy.

Guidelines for Case Analysis

Guidelines for Case Analysis
Read the case thoroughly & completely
Three readings are recommended
Case Brief
Write down review notes or brief summaries
Problem statement
Formulation in writing a precise definition of the problem as
evident in the case study
Problem analysis and elaboration
Everything should revolve around the problem statement
Generation of alternative solutions
Care analyst will have to develop meaningful alternative
solutions as many as desirable with an open mind
Evaluation of alternatives
Thoroughly and completely evaluate the process
Choice of solution
Acid test of the case analyst’s ability to choose between the
final alternative solutions
Contingency Plan of Action
Precautionary measure to immediately switch over to the
next best alterntive solution
Presentation of case analysis
The individual level – Individual case analysis
The group level – team analysis
An effective combination of both – Hybrid analysis
Writing – Written form = writing skills
Both = combination of both skills
Skills…
Clarity & simplicity of the ideas used
Use simple & short sentences based on the formula
keep it simple & short [KISS]
Avoid sing the passive voice
Tell who is doing what, & specify whose responsibility it
is to take action
Evaluate outcomes or possible effects of alternative
suggestions made
Take care of spelling, punctuation & sentences
structure in written presentation & body language while
making the oral presentation of case analysis
Strength / Weakness of case analysis

Analytical Technique

Analytical Technique
Environment – Micro & Macro
A Case analysis should be …
Logical
Sequential
Systematic
The analytical part of the care study can be taken up in tree mentioned
phases…
Basic or fundamental level of analysis
Detail indepth analysis
A conclusive final analysis
Five sense organs
1 Eyes 4 Tongue
2 Ears 5 Skin
3 nose

Solution Strategy & Decision Rules

The solution recommended by the case analyst should be …
1 Specific 4 Relevant
2 Measurable 5 Times
3 Achievable (Implement able)
The solutions must be …
Simple to understand
Easy to implement
Economical to operate
Effective in terms of solving the problem with a long term focus

Handling the case – Nature of the case

Classified into three broad categories…
1 Mini Case
2 Functional Case
3 Comprehensive Case
1) A Mini Case
Consists of 2 – 3 business incidents constituting a problem
situation
2) A Functional Case
Present case materials pertaining to different functions such
as…
Production
Finance
Marketing
Research & Development
Human resource management
Systems management
3) A Functional Case
Presents the total picture of an organization & the case study
contains materials & questions touching upon all the functions
Highly complex
Case analyst must be versatile

Brevity & Conciseness
Two kinds of case analysts
1 Loudly ineffective
2 Silently effective

Implementing the Decision

Implementing the Decision

Decision is useless unless it is implemented
Influences on individual decision makers
Measure the importance of a decision
Problem Misidentification
Avoid defining the problem "Too broadly" or "Too narrowly"
The problem stated as
Build a better mousetrap
Get rid of the mice
Group Decision Making
Strengths
Weaknesses
Tips for Decision making
Problem consciousness – The ability to determine problems by
recognizing abnormalities or sensing abnormal situations.
Problem Clarification
Understand what was actually happening
Understand what should be happening
Ten Managerial Roles
A Practising manager needs …
Possess sufficient quality & quantity of timely data
Information & knowledge to understand the problem solving
context & inputs
Requisite conceptual technical
Human relations
Administrative skills
Competencies to analyze
Interpret the data
History of Management, Case Study
Information & knowledge already available
The right mindset
Objective of Case Analysis
The specific objectives of case study method of teaching & learning
are …
Increase awarness of individuals
Gain knowledge of individual, team & organizational behaviour
Strengthen the abilities in proactively identifying, defining &
solving situational problems
Enhance the basic skills
Offer realistic training – hands on experience
The quality of case analysis largely depends upon …
Imaginative ability
Creative ability
Innovative ability
A Problem solving Format
The case analyst will be facing two alternative modes
1. He can be the part of the problem by simply glorifying & complicating
the issues involved in a case with a no solution mindset.
2. The case analyst can try to become the part of the solution
Renovision
It is the ability of an individual to look beyond the obivious or look
beyond the problems with a proactive mindset.
Level of Analysis
Five basic dimensions of analysis
People – Individuals & Terms
Organisational structure – Flexible or rigid, tall / flat,
Bureaucratic or free form
Task – Simple or complex, safe or hazardous
Technology – Labour intensive or capital intensive, hi-tech or
low-tech

Problem Identification : Methods

Problem Identification : Methods

1) Deviation from Past Performance
I took to the past for symptoms of problems in the present.
Employee turnover increases
Sales Decline
Sales expenses increase
More defective units are produced
MB 014 – History of Management, Case Study
2) Deviation from the Plan
 New products fails to meet its market share objective
 Profit levels are lower than planned
 Construction of a new plant is far off schedule
3) Criticism
 Customer dissatisfaction with new product / with their delivery
schedule
 Union presents grievances
 Investment firms may not recommend the organization as a
good investment opportunity
4) Competition
 Organization’s competitors for resources & clients
 A competitor introduces a superior new product

Problem Identification : Evaluating Alternatives
1) Conditions of Risk
50 % chance of capturing the youth market with new product
Actuarial tables used by insurance companies

Probabilities will be reasonalble accurate for a great number of cases over the long run

2) Conditions of uncertainty
Decision maker – no idea of the probabilities associated with the
various alternatives
Institution, Judgment & personality of the decision maker play an
important role
3) Multiple & Conflicting objectives
Competitiveness objective of a high quality product & an
efficiency objective of low maintenance costs
Profitability objective v/s Social responsibility
4) Optimal solutions are often impossible
Managers can in no way be aware of every possible alternative
Most managers are therefore not "Optimizers" but "Satisfiers".

History of Management, Case Study

History of Management, Case Study Introduction

Five elements governing a firm’s ability to manage competition
successfully are…
 People
 Poor Quality
 Cost containment
 Speed of delivery
 Innovation

Need for Decisions

A problem is the difference between what should be happening & what is actually happening.

1 Problem
Consciousness
Ability to determine problems by recognizing
abnormalities or sensing abnormal situations
2 Problem
Clarification
Identifying a discrepancy between an actual &
desired state of affairs
3 Cause
investigation
Finding the problem – root cause
Organizational problems

1 Problems with "Full" Solution 100 % Solution
Solution will give increased satisfaction &
morale among employees.
Example : Increase in 5 min tea break
2 Problems with "Partial"
Solution
Only Partial solution – Can not solved fully
Parties must adopt the holistic attitude of
‘give & take’ or ‘live & let live’
3 Problems with "No" solution No Solution
Become a condition & one must adjust to
live with the condition
Solution is beyond the normal capacity of the organization


Response to problem
1 Problem Avoiders Avoids or ignores information that points to problem
This type of people – Ostrich bird or Africa
People are – inactive & don’t want to confront problems
2 Problem Solvers Try to solve problems
People are – reactive with problems when they occur
3 Problem Seekers Actively seek out problems to solve or new
opportunities to pursue
People take – proactive approach to anticipating
problems before they occur


Effective Decision Making : Types of Decisions
 Programmed & non programmed decisions]

Problem Identific