Final Dissertation Project(CRM invades Indian Insurance
sector)IN PARTIAL FULFILLMENT OF THE REQUIREMENTS FOR THE POST
GRADUATE DIPLOMA IN MANAGEMENT
ByHimanshu Sharma
Under the guidance ofDr. T.K Singhal Faculty, Management
INMANTEC, Ghaziabad
1|Page
DECLARATIONI Himanshu Sharma a student of PGDM VI trimester of
Inmantec business school, Ghaziabad hereby declare that the
research project report titled CRM invades Indian Insurance
sector is my original work and the same has not been submitted
for the award of any otherdiploma or degree.
Place: Ghaziabad Date: HIMANSHU SHARMA
2|Page
3|Page
AcknowledgementA project is never the sole product of a person
whose name has appeared on the cover. Even the best effort may not
prove successful without proper guidance. For a good project one
needs proper time, energy, efforts, patience, and knowledge. But
without any guidance it remains unsuccessful. I have done this
project with the best of my ability and hope that it will serve its
purpose. To be or not to be is not anything which matters, how to
be thankful is what really matters It was really a great learning
experience and I am really thankful to Dr. T.K Singhal sir and my
faculties, who not only helped me in the successful completion of
this report but also, spread his precious and valuable time in
expanding my knowledge base. I wish to acknowledge my gratitude
towards Inmantec B-school, my parent, friends and all those persons
who are responsible for the successful completion of this
project.
4|Page
TABLE OF CONTENTS 1. Objective.62. INTRODUCTION ..7 3.
CRM.........................................................................................9
FEATURES......9 CRITICAL SUCCESS FACTORS..11 ESSENTIAL STEPS WHEN
CONSIDERING CRM....12 4. PLANNING A CRM PROJECT ...14 5. HOW TO
PREPARE YOUR OFFICE FOR CRM....22 6. WORK FLOW OF CRM
..........................................................23 7.
e-CRM.24 8. CRM IMPLEMENTATION ..28 9. CRMS TOP BUSINESS
MODELS..........................30 10. CRM INTEGRATION .33 11.
INDIAN CRM MARKET .34 12. CRM NECESSITIES FOR FINANCIAL SERVICES
.41 13. INSURANCE SECTOR IN INDIA43 14. IT in INSURANCE 47 15. CRM
FOR INSURANCE48 16. SUCCESSFULL STORIES OF CRM ...51 17. CHALLENGES
...64 18. SCOPE..70 19. FINDINGS...73 20. CONCLUSION 74 22.
RECOMMENDATIONS .75 23. BIBLIOGRAPHY.76
5|Page
ObjectivesTo analyze - Impact of CRM in Indian Insurance sector.
(A) Process involved in planning CRM.
(B) Find out successful stories of CRM in Indian Insurance
sector.
(C) Challenges of Indian CRM market.
6|Page
IntroductionAbout CRM:Customer relationship management (CRM) is
a management strategy that unites information technology with
marketing. It originated in the United States in the late 1990s,
and, to date, has been accepted in a significant number of
companies worldwide. On the other hand, some people have negative
opinions of CRM; such views hold that it is difficult to implement
successfully and that its cost-benefit performance is low, among
others. Customer relationship management is a broadly recognized,
widely-implemented strategy for managing and nurturing a companys
interactions with clients and sales prospects. It involves using
technology to organize, automate, and synchronize business
processesprincipally sales activities, but also those for
marketing, customer service, and technical support. The overall
goals are to find, attract, and win new clients, nurture and retain
those the company already has, entice former clients back into the
fold, and reduce the costs of marketing and client service. Once
simply a label for a category of software tools, today, it
generally denotes a company-wide business strategy embracing all
client-facing departments and even beyond. When an implementation
is effective, people, processes, and technology work in synergy to
increase profitability, and reduce operational costs. Due to
ever-increasing costs and competition, organizations now must sell
more products, and provide a higher level of service than at any
time in the past. Fast delivery of information and service are now
just as important as price. Without current technology, the
increasing demands placed on the people in your Customer Facing
Departments would make the job almost impossible. Software now
allows sales departments, marketing departments, consultants,
support reps and anyone else who interacts with customers and
clients to enhance their productivity beyond what many people could
have imagined just a few short years ago. Collectively, this
technology and the tools associated with it are known as Customer
Relationship Management Software, or "CRM". THE EVOLUTION OF
MARKETING STRATEGY The Changing Market Environment In the early
20th century in the United States, demand outpaced supply to the
extent that companies concentrated on selling as many products as
possible. Suppliers focused on product development, manufacturing
capacity, and securing distribution outlets, without regard to
their consumers. They did not pay much attention to who bought
their products or what their7|Page
customers needed. They used classic marketing tactics, i.e.,
mass marketing primarily print and broadcast advertising, mass
mailings, and billboards. By the middle of the 20th century,
however, the economy had matured to a point where consumers had the
power of choice because supply had outstripped demand. The era of
the passive consumer was coming to an end. Companies began to find
out who their customers were, what they wanted, and how they could
be satisfied. They analyzed data about their customers and
segmented them based on their demographics, such as age, gender,
and other personal information. Then they promoted their product or
service to a specific subset of customers and prospects. This was
called target marketing. Each company thought seriously about the
four Ps (price, promotion, product, and placement), the basic
concept of modern marketing, which was first suggested by the
expert in the field, Jerome McCarthy, in 1960. By the middle of the
1980s, when the economy was highly matured, it had become extremely
difficult to sell things. Traditional target marketing was not so
gratifying under circumstances in which it was so difficult to
cultivate new customers that this tactic could not sustain cost
efficiency. At this point, the idea of relationship marketing
gained the confidence of the business sector. This concept was
aimed at building long-term relationships with customers and placed
a great deal of value on the retention of existing customers rather
than the acquisition of new ones. I will explain this in detail
below. Retention and Acquisition Marketing operations consist of
two activities: acquisition and retention of customers. In the
world of mass and target marketing, the focus was on the
acquisition side. On the other hand, in the world of relationship
marketing, attention shifted to retention. This happened mainly
because of the cost involved. In general, it is believed that it is
five to 10 times more expensive to acquire a new customer than
obtain repeat business from an existing customer.1 As the needs of
customers became diversified, conventional promotions became less
efficient and drove up costs. According to the well-known empirical
Pareto principle, it is assumed that 20 percent of a companys
customers generate 80 percent of its profits.2 In other words;
retention of a large customer base is a major issue. Birth of
Customer Relationship Management In this context, CRM came into
existence in the late 1990s. Although there is no clear definition
of CRM, Jeffrey Peel, CEO of Quadriga Consulting, defined it as
follows: [CRM] is about understanding the nature of the exchange
between customer and supplier and managing it appropriately. The
exchange contains monetary considerations between supplier and
customer but also communication. The challenge to all supplier
organizations is to optimize communications between parties to
ensure profitable long-term relationships. CRM is a key focus for
many organizations now as a shift away from customer acquisition
toward customerretention and churn reduction strategies dictates a
need for best practice CRM processes. Share of Wallet and Life Time
Value
8|Page
In the age of target marketing, marketers aimed at the expansion
of their companies market share. With the advent of CRM, on the
other hand, they shifted their emphasis to increasing the share of
wallet4 of their customers. As mentioned above, they try to
establish close connections with their customers and offer products
that the customers really want, so that the customers will be
satisfied. Marketers estimate the value of customers on a long-term
basis, that is to say, life time value (LTV).5 Basically, LTV is
calculated as follows: Multiply a customers expected number of
visits times the average amount of money spent per visit. Deduct
your costs of acquiring and servicing that customer. Add in the
value of accounts this customer refers to you, and discount the sum
appropriately for the time period youre analyzing.6 It is difficult
to ascertain the exact LTV of customers, but there is evidence that
significant concern over creating long-term relationships with
customers is warranted.
Cross-Selling and Up-Selling Cross-selling is the behavior of
selling a product or service in addition to another purchase.
Upselling is the behavior of stimulating a customer to trade up to
a more expensive or profitable product or service. These strategies
are aimed at selling more to existing customers for the reasons
mentioned above. Taking an automobile dealer as an example,
suggesting a car navigation system for a buyer is cross-selling;
advising a higher-class car for a potential customer is
up-selling.
CRMThe concept of CRM is premised on the simple logic of
business: it must keep tracking customers once attracted; retain
them in business portfolio and profit from their growth.CRM
epitomizes the marriage of relationship marketing with the emerging
information technology. Integration of people, process, technology
and data. Effective CRM practices can mean the difference between
the success and failure of a business across all industries. CRM is
a way of differentiation between customers to provide greater value
to more valuable customers. The meaning of more valuable would be
in terms of the monetary spending received from the customer along
with regency and frequency of visit. CRM can be viewed in 4
principal ways y y y y Firstly it is a contemporary response to the
emerging climate of unprecedented customer churn, waning brand
loyalty and lower profitability. Secondly, CRM is central to the
task of making an organization customer centric. Thirdly, CRM is
the surest symbol embracing IT in business. Fourthly, CRM is the
most certain way to increase value to the customers and
profitability to the practicing organizations.
9|Page
CRM is the business strategy, process, culture and technology
that enable organizations to optimize revenue and increase value
through a more complete understanding and fulfillment of customer
needs. There is a "Revenue Gap" that exists in most companies
today. It is the difference in revenue that could be derived if all
of a companys Customer Facing Departments were working with optimum
information and at peak efficiency. Many companies understand that
the greatest competitive advantage they have is what they know
about their customers and how they use that data. However, most
companies have not established the systems and methods necessary to
capture customer centric information and leverage it into higher
revenues and profits. Once captured, this information may be used
to strengthen customer relationships that will then help to
differentiate your offering and decrease the necessity to engage in
costly price wars. Your ability to capture and leverage this
customer information will become the measuring stick for your
companys future success. Communication is the foundation of any
successful relationship and business relationships are no
different. Many companies are transitioning from the traditional
one-way mass marketing communication model to a two-way
communication model that engages their customers in an ongoing
dialogue, creating a learning relationship. Every contact with the
customer, whether its e-mail, phone, Web, or face-to-face, is an
opportunity to learn more about the customers unique preferences,
values and expectations. It is also an opportunity for the customer
to gain valuable insight into a companys product or service
offering. Enlightened companies are refining their product or
service offerings based on what they learn, and theyre using this
greater understanding to create deeper, more profitable long-term
customer relationships. The more your customers invest in these
learning relationships, the greater their stake in making the
relationship work, and the harder it becomes for your competitors
to place a wedge between you and your customers. QIEM starts with
the goal of helping companies develop comprehensive Customer
Relationship Management strategies and solutions that focus on
improving four key areas: Communication the exchange of information
that, in turn, builds a greater understanding for both parties.
Efficiency those areas for improving productivity while not in
front of the customer. Effectiveness those areas for improving
productivity while in front of the customer. Decision-Making
leveraging the information derived to set future direction. A focus
on these four key areas will help your company narrow the Revenue
Gap by decreasing expenses and increasing revenue.
Definition CRM is the business strategy that aims to understand,
anticipate, manage and personalize the needs of an organization's
current and potential customers" -- PWC Consulting
10 | P a g e
Rather it is the IT face of business processes that aims to
establish enduring and mutually beneficial relationships with
customers in order to drive customer retention, value and
profitability up. Important features of CRM y It permits a one-to
one marketing as compared to mass marketing y It stresses
commitment over flirting y It helps disintermediation and delayed
distribution aspects. y It helps reducing marketing cost
significantly.
Critical Success Factors for CRMGeneric CSFs can be defined for
any CRM project. These align around customer-facing processes and
include: creating a customer culture adopting customer-based
measures introducing effective IT segmenting customers developing
an end-to-end process. The degree of change required around each of
these measures needs to be evaluated at the outset. Many companies
have customer-facing processes in place, such as complaints
handling and customer service. Other initiatives may be less
effective. For example, there is widespread dissatisfaction with
loyalty programmes in many cases, they do not create added value
because they are not integrated with product or service
development. It is important not to develop what is, in effect, a
wish list of processes, however. Processes need to be actionable
and economic. Changing the business culture to be customer-centric
can be a significant challenge because of the long-term dominance
of the product view. It is vital to change the measures on which
business performance is assessed this also allows the organization
to benchmark how well it is progressing towards CRM. Reporting is
closely linked to culture, as it indicates what the company
believes is important. While customer satisfaction measures are
relatively widespread, many companies struggle with identifying
customer profitability. Fewer than half of all organizations have
this measure in place (although one-third plan to introduce it),
while more complex indicators such as lifetime value, are even less
widely adopted. Aggregated, gross financial measures still dominate
and need to be11 | P a g e
added to. Customer-defined measures also need to be adopted to
evaluate performance against expectations. CRM systems and
technology have been a major focus and 40 per cent of companies
have already implemented them. Vendor selection is critical: a
robust process needs to be adopted, as the right partner will
affect the outcome of the project. End-users need to be consulted
and piloting organized, with strong management support and training
to ensure adoption. The impact of internal IT issues can be
overlooked, but may harm the outcome of CRM implementations unless
they are carefully managed. Gaining a better understanding of the
customer base is an important step, especially the adoption of new
segmentation practices (which seven out of ten companies are
undertaking). The primary new approach is needs analysis, providing
insight into how these differ by customer group. This may often
reveal where the organization needs to make service improvements,
or where it can achieve differentiation. To be effective, the CRM
process needs to be integrated end-to-end across marketing, sales
and customer service. This may require the introduction of
board-level representation of the customer. There are important
human resource implications, such as managing the expectations
created by the project concerning timescale, costs and results.
High-level sponsorship and a steering committee can be central to
this, working closely with the project team.
7 Essential Steps When Considering CRMFor 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) What are your 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. For example, one of your business objectives
could be to increase retention of current clients by 5 percent over
the next three years.
2) What processes will the 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 clients12 | P a g e
throughout the year? Understanding what could be impacted can
help you identify areas you want to adjust, change or keep intact
once the software is installed. 3) What are the anticipated 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) What features and functions are most critical to achieving
your
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. Here's a hypothetical example: Business
objective: Increase client base by 10 percent with a corresponding
10 percent increase in revenue in the next three years. Processes
impacted: Lead conversion process, which includes looking up
pertinent client information before contacting the client
(currently a long, manual process). Anticipated gains: Time savings
to free up more time for prospecting. Function needed: The ability
to quickly look up pertinent client information, including updated
portfolio information, goals, net worth, etc. Track the stage each
prospect is in. By using this information you can outline exactly
what you need the software to accomplish to achieve your
objectives.
5) What incentives and measurements exist 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.
13 | P a g e
6) Who will be responsible for evaluating and improving your
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) Which
CRM is the best fit? 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. While
going through all of these questions may seem like a daunting task,
you will ultimately be better equipped to choose and use a software
system that will help you take your practice to the next level.
14 | P a g e
PLANNING A CRM PROJECTA well-defined and thought out plan
outlines the following: The general business goals and objectives
The necessary people involved A date for implementation A budget
for all phases of the solution A Technical Inventory
The General Business Goals and ObjectivesThe first step in
implementing a successful CRM project is to conduct an internal
analysis. From this point you can begin to outline your project
goals, objectives and requirements. Current State Analysis
Successful solutions begin with analysis. This usually starts with
an assessment of the current state of things. These most usually
include the "aches and pains" that hinder your teams productivity
and detract from your companys goals, but they might also include
certain strengths within the current system. It is important to
identify both. How do you know what the current state is? Begin by
asking your sales, marketing and customer service teams a few key
questions: What are the strengths and weaknesses of your companys
current processes? How can the processes be improved? What
administrative activities are detracting from their
productivity?What is the competition doing?
Desired State AnalysisYour desired state will establish and
define the ultimate project goals. This analysis will result in a
clear direction for the project and be the foundation for measuring
the projects success. This analysis will also define the "Gap"
between the Current and Desired State. Also, as a result of this
phase of the analysis, the areas where the Revenue Gap can be
narrowed will become obvious. Technology is an enabler, not a
solution itself. Automating an inefficient process will only speed
up the wrong activity. On the other hand, automating very strong
processes can be easy and early victories for your system.
Examples: Increased customer satisfaction Shorter sales cycle
Higher close rate Higher margin per sale15 | P a g e
More accurate revenue forecasting Improved management
information Stronger relationships with partners
Project GoalsYour project will begin to come into focus once you
begin to drill down into the measurable, tangible project goals
that address your CRM solutions unique requirements and specific
needs. Example Objectives: Reduce the time required to disseminate
leads to the sales team Automate quote and proposal generation
Create and distribute reports electronically Cut the time required
to generate forecasting reports Eliminate duplicate data entry
Distribute pricing information, collateral materials or inventory
Catalogs more quickly Facilitate group scheduling and activity
calendaring Your project objectives will become your projects
critical success factors. Youll use these to evaluate CRM
solutions, and in turn, they will become the benchmarks or criteria
that the solution must meet in order to be considered successful.
If you dont identify the projects objectives, youll.
Project DeliverablesYour project deliverables drill down further
into the specific business needs that your system must address.
This detailed list of features and functions will sometimes serve
as the body of an RFP used to evaluate and compare CRM
applications. Example Deliverables: Classify contacts by type, such
as prospect, customer, reseller, supplier, business partner
Automatically notify other team members of important plans, events
or customer interactions Run reports automatically and distribute
electronically Track customer referrals and lead sources Manage
multiple marketing campaigns, projects and activities Create
mailing lists and generate targeted direct mailings using fax,
e-mail or standard mail
16 | P a g e
Maintain an online encyclopedia of all marketing and sales
materials including slide presentations, videos, graphics and audio
clips Synchronize data changes, additions, deletions and
modifications to records with mobile users.
Cost JustificationYour CRM solution plan should also provide a
basis for justifying the expense associated with your initiative.
Increased revenues and decreased costs are the obvious ROI
indicators, but more must be understood. To justify the costs,
first determine your ROI expectations. Begin by outlining your
project goals and defining your measurable objectives. Convert the
measurable objectives into a dollar amount that reflects the
operational savings and increased sales that you anticipate. Now
you can calculate how quickly you will realize a 100% ROI.
Example ROI Equation:Company XYZ automated 20 salespeople with a
CRM solution. As a result, each salesperson reduced his or her
administrative tasks and non-selling time an average of 4 hours a
week. 4 hours X 20 salespeople = 80 extra selling hours/week. Thats
equivalent to hiring two additional salespeople without the
overhead. Next, add to your ROI analysis the less tangible benefits
that your organization will derive, such as: Enhanced communication
Greater Responsiveness Better-informed employees Better-informed
management Happier Employees To achieve success, the CRM initiative
must be endorsed and used at the highest level. Involve users in
the analysis. Create a system that becomes a tool for them, not
just a repository for management information. A solution may take
as little as 30 days to implement, all the way up to 120 days,
based on complexity.
Involve the Appropriate PeopleThe most important factor in a
successful CRM implementation is the people involved. Involvement
has to start at the top with management and include relevant
parties all the way to the user level. As a rule, successful CRM
projects have an executive as the project champion. They make sure
the project stays on track by setting the initial project goals and
objectives, and eliminating obstacles that arise. Executive support
and endorsement ensure that the CRM solution becomes a part of the
corporate culture.
PrioritizePlan meetings where the teams can discuss the
opportunities to improve your current system and have them
establish the priority of some "must-do". Since the CRM project
will also impact17 | P a g e
management and information services (IS), poll them individually
or create representative teams to compile their critical success
factors as well. Early participation by everyone affected by the
CRM solution promotes a sense of ownership and stimulates
enthusiasm before the solution is implemented. Failure to involve
the users during the project development leads to user resistance
when you roll out the solution.
Establish a TimelineImplementing a CRM solution, or any
automation project, without pre-implementation planning is a
sure-fire way to set out on the road to failure. An effective
planning process includes creating the project calendar, complete
with established deadlines and scheduled meetings. If your decision
process will be by committee, delegate the appropriate tasks to the
members. The length of the planning process can range from a few
weeks to several months depending upon the complexity of your
companys processes. Low-end contact management applications that
are implemented "out-of-the-box" require less time than high-end
enterprise solutions with complex customizations. Implementing the
typical middle market CRM solution, not including your
preimplementation planning, usually requires 30 to 120 days to
complete. Many factors can affect the implementation timeline,
including the depth and breadth of your customizations, amount of
your internal IS departments participation, the number of users to
automate, the amount of data to convert, and the degree to which
the CRM solution will be integrated with existing systems. To help
our clients begin realizing the benefit of their CRM solution
quickly, QIEM recommends a phased implementation approach. In a
phased approach, we begin by implementing the solution with only
the minimum amount of customization necessary to meet your projects
most critical success factors. Your employees begin using the CRM
solution quickly and your company starts to realize ROI
immediately. As the users become familiar with the systems
capabilities and features, additional customizations are made in
subsequent phases. The most successful CRM projects only attempt to
implement in each phase as much as the users organization can
absorb. A phased implementation can also help your project avoid
the "scope creep" that can occur when you attempt to address too
many requirements all at once. If you approach your CRM project
with a long-term vision, then segment that vision into prioritized
phases; youll be less likely to overwhelm your organization with
massive changes.
Take a Technical InventoryOne area thats often overlooked prior
to selecting a CRM solution is the technical inventory. It is
critical to know the current components and age of your companys
technical infrastructure. This information will directly impact
both the cost and operability of any CRM solution. Enterprise wide
CRM solutions are designed for the client/server environment,
Web-based environment or combination of the two. While some
products will function in a variety of technical infrastructure
configurations, others are designed for a limited number of
configurations. If your technical infrastructure will not support
the application you select, you may have to decide whether to
change your infrastructure or choose from a more limited list of
solution options. Some solution providers or software publishers
offer system-hosting services. This alleviates some of your
internal IS departments responsibility from some of the maintenance
and administration of your CRM solution, but generally costs
considerably more over 48 months or so.
18 | P a g e
Establish a BudgetFront-office automation solutions vary from
low-end, "off-the-shelf" products to high-end, customizable
solutions. The cost of these products will vary significantly based
on functionality, scalability and architectural elegance. While the
CRM marketplace is crowded and fragmented, you should be able to
compile a short list of systems to review based on your specific
CRM objectives, business requirements and technical infrastructure.
The greater your functional requirements, expect the cost for the
system to increase. Your CRM project budget will need to account
for the following Components: Software Consulting (analysis and
project management) Customization, Integration and Data Conversion
System Implementation User and Administrator Training Technical and
User Support Software Maintenance There are two categories of costs
commonly associated with a CRM project: Implementation Costs: These
are the costs associated with the initial system implementation.
Annual Costs: These are the ongoing costs associated with the
long-term maintenance and support of the system.
Implementation CostsTo make sure that sufficient resources are
available from the outset of the project, it is important to
consider the solutions total cost. In addition to the software
licenses, other costs associated with the initial implementation of
a CRM solution include customization, implementation, training,
support, and maintenance. These additional costs over and above the
software will generally be 1 to 3 times the cost of the software. A
typical middle market CRM solution implementation costs from $1,000
to $4,000 per user. Annual Costs Once youve completed your
implementation there will be annual expenses required to ensure the
long-term success of the solution. Support Typical support
agreements give you direct access to technical analysts for problem
resolution, bug reporting, documentation clarification and
technical. Maintenance Typical maintenance agreements include
software updates, software upgrades and new versions. Without a
maintenance agreement, you will have to purchase separately the
software upgrades and new versions required to keep your system
current. Industry standards are two to three software updates per
year, one software upgrade per nine months to one year, and a19 | P
a g e
new version every 18 months. A support agreement usually costs
10-15% of the software publishers current suggested price for the
software. Professional Services In addition to the support and
maintenance agreements, you will want to budget annually for the
professional services necessary to implement the upgrades, updates,
and new versions. Ongoing Training When new versions or
customizations are planned, you will need to include additional
training for your users in the annual budget. New employees will
also require user training to ensure they are using the solution
successfully.
SELECTING A CRM SOLUTIONThere are over 400 front-office
automation solutions on the market today. Keep in mind"Execution is
more important than vision". Your success depends on the ability of
your company and your selected business partner to successfully
integrate the new tool into your existing ecology. So it starts
with the planning process. The more planning that is done, the more
obvious the selection will be. The "must-dos" are the benchmarks
used to evaluate each solutions ability to effectively support your
business processes and address your automation requirements.
Solution evaluation processes range from an informal discussion
among the project leaders to a formal rating procedure involving
the entire project team. The complexity of your business processes,
the amount and detail of your project requirements, and the number
of solutions you plan to evaluate will guide the format of your
evaluation process. Establish benchmarks for evaluating a solution.
The evaluation should include all factors that could impact your
solution.
Proprietary SystemsYou may be considering designing your CRM
solution from scratch. The initial cost of developing a proprietary
system may look attractive, but many companies find that after they
"re-invent the wheel" they face ongoing development costs to keep
the system functioning. Most of these proprietary projects fail
because of one or more of the following reasons: Lengthy design and
implementation cycle Resource draining maintenance requirements
Future platform incompatibility Inability to integrate system with
other enterprise applications Reliance on a single custom
developer
Packaged SolutionsImplementing a packaged CRM solution with
customizations to accommodate your business practices will save you
both time and money. Customized solutions can be implemented in
less time than it takes to develop and implement a proprietary or
homegrown system. Customized20 | P a g e
solutions also require fewer resources to maintain and can be
readily integrated with back-office automation solutions such as
MRP/ERP and accounting/finance systems. When evaluating a CRM
solution, you want to consider the software developers market
leadership or position, the long-term growth goals and financial
stability. In the current economy, many CRM vendors are not
financially stable. The last thing you want is to select a vendor
only to see them go out of business in three months. Check out
their financials. It is also important to purchase a mature
product, not some late entry into the middle market CRM space. Most
new products may have some slick new technology, but never make
enough of a dent in the market and mind share to survive. You will
also want to be comfortable that the solution is scalable and will
grow with your company. You may only have ten sales reps today, but
will the system still handle 50 or 100 sales reps easily without
abandoning it. Consider carefully the methods that the CRM solution
can be customized. Many appear to be simple to customize in a quick
demo, but cannot be inexpensively adapted for more complex
customizations. You may not feel that you need these today, but
most companies regret not considering this aspect in their decision
process. For example, can you affordably add custom business logic
to the data entry and other areas using a simple and commonly
understood programming language such as Microsoft Visual Basic? Can
you add additional tables to the CRM system? For example, could you
add a custom 1:Many table associated with the Account or Company
table to store multiple software licenses, multiple channel
partners, or multiple products? Do not trust the sales rep with an
answer like Yes, no problem!. We tend to call this type of answer
SMOP, or Simply a Matter of Programming, and many, many dollars.
Have them demonstrate how you can make such changes in front of
you. Do not trust any custom demos developed off-site. Also, check
with other companies who are using the system. See how much they
have been able to adapt and customize the system to their special
business needs.
SELECTING A SOLUTION PARTNERSelecting a knowledgeable, reputable
solution provider or systems integrator is more important than
selecting the best solution for your project. You can take an
excellent CRM software package and totally mess up your
implementation if it is not done right. You will want a partner
with the resources to provide full implementation support including
system design, customization, data conversion, installation and
training. Look for the following in a CRM partner: Specialized
resources Companies and organizations that have consultants who
specialize in Customer Relationship Management understand how to
implement successful solutions. Organizations with resources
dedicated to supporting CRM solutions are able to provide
comprehensive services and ensure the long-term, ongoing success of
the system. Current certifications and training Maintaining a staff
of trained and certified professionals requires a significant
allocation of a companys resources and is a strong indicator of
their commitment to servicing the CRM solutions they represent. It
is important that the team assigned21 | P a g e
by your CRM partner to implement your system includes
experienced professionals certified to customize, integrate and
provide training for the solution you select. Check out the
experience of the consultant to be assigned to you. In fact, be
sure to meet this consultant prior to your selection of the
solution provider. CRM Experience The CRM industry is growing
exponentially, and so are the numbers of solutions and solution
providers. It is important that your partner has the experience,
both with implementations and with the product offered to
understand both the technical and strategic aspects of CRM. Be wary
of ERP and Financials solution providers who also offer CRM
solutions. With the slowdown in their market, many have jumped into
the hot CRM space but have little experience and understanding of
it. Documented methodology The solution provider that you choose
should utilize a proven and documented project management system.
Development of a successful, repeatable methodology is a strong
indicator that they will deliver a reliable solution form start to
finish and that they are committed to the CRM market. Client
references The best way to assure that your implementation
experience will be positive and professional is to check client
references. Call three to five of their customers and ask questions
such as: Did the solution provider meet the project deadlines? How
were last minute changes handled? How well did the solution
provider communicate with them? Was the final project cost in line
with the estimate? How well have they provided "after sale"
service?
How to Prepare Your Office for CRMBusiness surveys show that
more than half of CRM solutions actually fail because of poor
implementation. Business experts recommend ten steps that project
managers can take to ensure the successful adoption of new CRM
solutions.
1. Get Clear on Who Owns CRM Solutions
Some marketing professionals perceive sales automation as a
function of the IT department. In other organizations, CRM might be
viewed as an individual's "pet project." Instead, everyone in an
organization should have some emotional buy-in for CRM to
succeed.
22 | P a g e
2. Communicate How CRM Solutions Help Meet Business Goals
Customer relationship management encounters resistance in
organizations where CRM solutions appear to contradict goals. For
instance, if employees don't feel empowered by information, CRM can
become a waste of time. Tying each element of a CRM implementation
to a policy or to a vision statement can improve its chance for
success. 3. Put Customer Relationship Management into Strategic
Context In organizations where CRM solutions fail, project managers
often focus on the potential savings of sales automation features.
Instead, successful project managers emphasize the areas of
longterm opportunity opened up by CRM. 4. Offer Thorough Training
on CRM Solutions scheduling a handful of mandatory training
sessions is a great strategy for a failed implementation, according
to veteran project managers. Understanding that different team
members may have different learning styles can lead to a more
comprehensive training program that continues beyond the launch
phase. 4. Offer Thorough Training on CRM Solutions scheduling a
handful of mandatory training sessions is a great strategy for a
failed implementation, according to veteran project managers.
Understanding that different team members may have different
learning styles can lead to a more comprehensive training program
that continues beyond the launch phase. 5. Carve Sales Automation
Tasks into Manageable Chunks CRM solutions fail to gain traction in
organizations when one team member or job role becomes tasked with
"keeping things running." Instead, project managers can work out
assignments for specific departments that keep the system from
developing a bottleneck. 6. Track ROI on CRM Solutions Project
managers often justify a CRM solution by pointing at the potential
cost benefits. Moving beyond the internal savings and into tracking
the new business generated from sales automation and other modules
is essential to keeping a CRM project moving forward. 7. Prepare
for Culture Shock after Online CRM Implementation Online CRM tools
break down barriers in organizations, even when stakeholders prefer
to keep some information to themselves. Openly addressing coming
changes and their implications early in the launch cycle can help
prevent team members from rolling back into old habits. 8. Roll Out
CRM Solutions Gradually In organizations where CRM solutions failed
to take root, stakeholders often reported feeling overwhelmed.
Launching CRM in smaller chunks maintains a sense of forward
momentum while team members become acclimated to new systems. 9.
Ask for Input on Customization and Future Releases when
stakeholders feel "shut out" of the release process, CRM
implementations fail. Soliciting23 | P a g e
and tracking feature requests can help team members understand
how CRM solutions evolve over time, based on user feedback and
budget guidelines. 10. Celebrate Milestones Regularly Taking time
to celebrate wins is just as important as addressing opportunities,
according to many experienced CRM project managers. Giving team
members time to reflect on the positive impact of a CRM solution
can shift focus away from gripes and criticisms of an incomplete
system. Clear Communication Leads to CRM Success Experts agree that
following these ten steps often leads to significantly higher
success rates for CRM rollouts. Keeping everyone in the loop about
the rationale for and the progress of the project is essential to
an effective launch.
Workflow of CRMA simplified CRM workflow is as follows.
1. Collecting Customer Data and InformationAcquisition of
customers and basic data including name, address, gender, age, etc,
is fundamental, but transaction data such as date, time, item,
value, etc. at every touch point,7 i.e., a point of interaction
when the company communicates with a customer, or vice versa, are
also essential. Information is often needed to complement these
data. It is a knowledge that comes from asking questions to
customers such as why and how.8
2. Analyzing Data to Predict Customer BehaviorMarketers use
these data and information so that they can record the interests
and preferences of customers. Furthermore, they attempt to
ascertain purchasing patterns on the basis Of transaction records.
Using sophisticated modeling and data mining techniques, behavior
prediction uses historical customer behavior to foresee future
behaviors.9 Understanding the tendency that a certain type of
customer is apt to purchase a specific product (propensity-to-buy
analysis) and that certain products are often bought with other
specific products by a particular type of customer (product
affinity analysis) has a beneficial effect on making marketing
decisions.
3. Marketing Campaigns: Applying the Results of
AnalysisCompanies conduct marketing campaigns that are designed on
the basis of the results of analysis or on hypotheses. They promote
their products through various channels, such as e-mail, the
Internet, telemarketing, or direct mail. They also contact their
customers for follow-up after purchase. And, of course, they have
to monitor the results of that campaign in order to refine future
campaigns. With CRM software, they can, for the most part, automate
these processes.
4. Measuring Results, Revising Hypotheses, and Repeating This
Workflow Process24 | P a g e
To improve their results, companies need to evaluate the effects
of their marketing campaigns. They should measure whether and how a
given campaign achieves its original goal and revises their
hypotheses according to the results. After that, they should repeat
the workflow process, thereby making gradual progress.
About e-CRM:ECRM Electronic CRM concerns all forms of managing
relationships with customers making use Of Information Technology
(IT). 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. 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 eCRM
today. We can define eCRM as activities to manage customer
relationships by using the Internet, web browsers or 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 customers specific
needs Channels, through which companies can communicate with its
customers, are growing by the day, and as a result, getting their
time and attention has turned into a major challenge. One of the
reasons eCRM is so popular nowadays is that digital channels can
create unique and positive experiences not just transactions for
customers. An extreme, but ever growing in popularity, example of
the creation of experiences in order to establish customer service
is the use of Virtual Worlds, such as Second Life. Through this
so-called eCRM, companies are able to create synergies between
virtual and physical channels and reaching a very wide consumer
base. However, given the newness of the technology, most companies
are still struggling to identify effective entries in Virtual
Worlds. Its highly interactive character, which allows companies to
respond directly to any customers requests or problems, is another
feature of eCRM that helps companies establish and sustain
long-term customer relationships. Furthermore, Information
Technology has helped companies to even further differentiate
between customers and address a personal message or service. Some
examples of tools used in eCRM: Personalized Web Pages where
customers are recognized and their preferences are Shown.
Customized products or services (Dell). CRM programs should be
directed towards customer value that competitors cannot match.
However, in a world where almost every company is connected to the
Internet, eCRM has become a requirement for survival, not just a
competitive advantage.25 | P a g e
E-CRM and its Benefits The long-term business relationships
provide many potential benefits for banks and clients. It is
Generally less costly for any service firm (bank) to maintain and
develop an existing client Relationship (Berry 1983). The customer
can also make transaction cost savings by developing a Long-term
relationship with bank. The numerous studies carried on in USA
reveals that transacting through Internet is much more economical
than other channels. For instance, it has been estimated that while
it costs nearly US $1.07 per transaction using the normal means, on
the Net the costs comes to a mere cent. Even when compared with
telephone banking (5 cents) and the ATMs (2.7cents), the Net seems
to have an edge. In addition, the strategic and social benefits may
be considerable for both parties (Halinen 1989). A long-term
relationship may, for instance produce strategic benefits for the
bank in its marketing by generating references and credentials or
it may create competitive advantage by building barriers to
switching. The client on its part may enhance the quality of
services offered by engaging in long-term business relationship
with a bank (Berry& Parsuraman 1991).In Net banking the
financial statement can be viewed, printed or down-loaded in any
format for ease of analysis. Thus, Internet as a service-delivery
channel shifts the control of transactions from the bank staff to
the customer. Net bank customers find better information through
websites than from the unwilling, less knowledgeable and
noncooperative banking staff. Thus high level of customer control
that translates into customer satisfaction and repeat purchases the
most critical advantage of e-CRM in banks. Other related benefits
include decreased cost of sales and promotion, high supply-chain
management integration and improved logistics management. Current
Status of e-CRM in Indian Banks Internet has enabled banking at the
click of the mouse. At present there are five functional Categories
for online banking sites on line brochure center, interactive bank,
e-mails, calculations and cyber banks, which offer customers access
to account information, inter-branch funds transfer and utility
bill payments. Banks have tied up with service providers in telecom
and power sectors like MTNL, BSES and cellular service providers
for allowing their customers to make bill payments online. In
India, new private sector banks like ICICI Bank, HDFC Bank, Global
Trust Bank and UTI Bank, have taken the lead in e-banking. Among
the foreign banks, Citibank, has noticeable presence, while others
like Federal Bank, HSBC Bank, Deutsche Bank and ABN Amro Bank, are
moving towards becoming big players in e-banking. Even the state
run banks like SBI and Union Bank of India have realized the
advantages of such services. ICICI Bank, the first bank to offer
e-banking services in India has more than one lakh regular Internet
user accounts, of which more than 25 percent are of NRIs. The bank
has viewed advanced information technology as a managerial and
competitive tool and has tried to harness technology to the maximum
possible extent to deliver superior customer services. The Bank has
emerged leader in B2B and B2C initiatives. A B2B solution
(i-payments) aims at facilitating online supply-chain management to
it corporate clients by linking them with their suppliers and
dealers in a closed business loop. All members in this loop are
required to maintain the account with the bank. This product has
gained considerable market acceptance and the bank has already
entered into memorandum of understanding with over 100 large Indian
companies. The Bank became the first bank in India to introduce
utility bill payment through Internet. Bank has entered into
tie-ups with leading telecom companies such as MTNL, Tata
teleservices, VSNL and cellular operators such as BPL Mobile,
Airtel and Usha Martin. Tie-ups have been26 | P a g e
established with BEST & BSES for electricity payment in
Mumbai. The bank with its net banking service called Infinity goes
a step forward by allowing the account holder to transfer fund into
another persons account with the bank. Also one can intimate about
the loss of an ATM card over the net when using Infinity. Corporate
sector can issue letter of credit and make inquiries regarding
bills sent for collection via this service. It also provides
facility for nicknaming all accounts to avoid remarking lengthy
accounts number. UTI bank has tied up with Cosmat Max, to create a
communication network for its customers. The network will have 50
VSAT terminals at strategic locations, which will help in ATM
servicing and internal management information system. The bank has
signed a memorandum of understanding with equitymaster.com for
e-brokering activities of the site. This will enable the bank to
leverage its database for e-commerce and other initiatives with
data-warehousing and data-mining, where information of the customer
spending habits will be used to sell other correlated products like
credit cards. HDFC Bank has, for the first time in India made the
e-shopping experience secure online and real time with the launch
of its payment gateway. This will allow any Visa/Master credit card
holder anywhere in the world to make payments for global services
over the Internet. The bank has tied up with 15 portals and is in
talk with several others to offer secure business to customer
e-com. transactions. The first secure, on-line and real-time e-com.
credit card transaction in the country was done on the Easy.2
shoppe.com shopping mall, enabled by HDFC bank on a Visa card,
heralding the launch of the payment gateway. HDFC Bank also offers
a direct debit option whereby its customer can pay for the goods or
services by a secure password enabled transfer of funds from their
account to the merchant account. The state run public sector bank,
the State Bank of India (SBI) made a quiet foray into net banking.
The countrys largest commercial bank launched on-line SBI - an
account browsing facility over the Net for customers in eight
select branches including four NRI branches. E-CRM Techniques used
by Banks in India Banks leveraging technology can develop
innovative customer solutions to attain growth with Profitability
within the framework of sound risk-management practices.
Techno-savvy banks are Tapping into online services to initiate a
new era in relationship management to create one to one
Relationships as well as one to many relationships to enhance their
competitive advantage. Recent developments in critical areas of IT
have changed the way banks are managing their Customer
relationships. The following are some of the latest e-CRM
techniques used by banks in Offering new products and services to
its customers. 1. Internet banking: Internet is being used by banks
to disseminate information to customers about banks products and
services through their websites. The banking services are provided
through Net with convenience of ease and accessibility. Internet
banking offers many benefits To the banks viz. vast reach, reduced
transaction costs, direct marketing and cross selling, Build banks
brand, etc. It also offers benefits to customers viz. reduced cost,
convenience, Banking with the bank and not the branch, speed,
better cash management, etc. The new private sector banks ICICI
Bank, HDFC Bank, UTI Bank and the Global Trust Bank have taken the
lead in Net Banking. The state run public sector banks are lagging
behind in Net banking, although modest beginning has been made by
the State Bank of India. 2. Data Warehousing and Data Mining: This
technique is used to develop and use customer data to check their
profile, retention and loyalty patterns. They provide valuable
inputs for retaining customers and developing products and services
for the future.27 | P a g e
3. ATMs: At present installed number of ATMs in the country is
1800, which is likely to be more than 4000 by next year. Most of
the demand for this technology is coming from State owned banks.
Until now, ATM services have been confined to deposits and
withdrawal from bank accounts by customers. The growth in ATMs has
been fuelled by a race among banks to expand their customer base by
going in for more value added services (bill payments and ticketing
services) on these machines. 4. Telebanking or Mobile banking:
These services empower the customer with an instant access to
routine queries and transaction or check bank balances. 5.
Computerized decision support system: This helps the banks in
applying optimization techniques in functional areas such as,
assetliability management, optimization of investment portfolios
and asset portfolios through linear programming. This is a
practical tool which helps the bank managers and customers in
optimizing investment decisions. 6. E-mail: Banks can maintain the
list of its best customers and inform these members through e-mail
the various services and schemes offered by the bank. These days
this is considered as one of the cheapest and effective means of
communication. 7. Computer networking: Networking between the
branches of divisional, regional, zonal and Head office of banks
provides access to customer data base from the executive desk. This
will Integrate the front-office applications with back-office
requirements, thus generating MIS for Branch managers and
executives at the different controlling offices including Head
office for accurate, speedy and cost-effective customer services.
8. Customer smart cards: These cards are issued to key customers
which carries all the relevant Information, details of previous and
repeat purchases, to make it convenient for the customers to recall
and for the banks to keep a track of the behavioral and purchase
trends. Utilities like BEST in Mumbai are already using smart cards
for ticketing in its luxury buses.
Phased CRM Implementation - Is it the Right Choice?CRM is the
most influential customer strategy of the decade. What started out
as a customer retention program today has developed into a fully
fledged business strategy often involving millions of dollars? How
long does an actual CRM implementation take? How long does it take
to see some return on investment after employing a CRM strategy? A
company can expect a fair share of return on investment equivalent
to at least ten times its investment. Companies should comprehend
the fact that they are actually starting up a project that could
take at least 5 years but will lead to phenomenal increase in
market share. Since most organizations try to get the whole
organization involved in a CRM project they face considerable
difficulty. This happens as most organizations are built to resist
change. It is important to
28 | P a g e
concentrate on one department, make evident changes and then get
the rest of the organization involved. CRM's Time Frame- What you
Need to Knowy
Sometimes putting money into a 5 yr plan may seem unwise
therefore it is better to opt for small investments - quick steps.
The return on these little investments can be used to further
greater expansion. So one should therefore opt for a 6 months, one
year project and then continue from there on. Every organization
needs to establish its goals clearly. From then on it has to decide
at which point it actually is and where it really wants to see
itself after its CRM implementation. It is imperative that the
organization have a long-term commitment to the CRM project and be
willing to invest the required amount of effort time and money to
obtain necessary results. The organization should not expect a
return on investment too soon. Expecting a short return on
investment say 6 months will have detrimental effects. The average
implementation time for organizations that implement most CRM
solutions is 12 - 16 weeks while the industry average hovers
greater than 10 months. An organization that implements CRM should
expect full ROI in 10 months. Return on investment is usually 4 to
7 times the initial and ongoing investment. Large scale change
requires much more additional time. Over the first 3 years CRM will
evidence a steady growth rate and deliver a profitability increase
in millions. As the CRM program continues each step should pay for
itself in only 6- 12 months Customer behavior shows only within a
few months although some customer behavior takes longer to change.
Significant improvements take place only a few months after
employing the CRM strategy. After the implementation of the
strategy CRM focus should be on customer interactions and using
this to meet customer needs. What's most important is to build and
launch, then improve, rather than spend months in preparation
before the initial launch.
y
y
y
y y
y
y
So what's the best option? Do organizations opt for a one time
plan or a phased implementation strategy? Opting for phased
implementation is certainly more beneficial and is the better
choice of the two. Guidelines for Successful Phased Implementation:
Ease Slowly into CRM Implementation Establish your business needs
first. Next companies need to establish a CRM project that has a
short delivery period so that the project can be delivered in a
short timeframe. It is better to opt for phased implementation,
small individual projects than a mammoth one. This will ensure that
there is adequate return on investment and that there is
considerable cost reduction and efficiency.
29 | P a g e
CRM Package vs. Business Needs It is important to ensure that
the best balance is obtained between the CRM solution and the
actual use of it. At most times businesses find that they are
adjusting their business processes and goals to the CRM package and
vice versa. An effort should be made to make use of the CRM tools
to the best of its ability while at the same time accommodating
business processes. Get Management Involved CRM executives and top
management should be involved. Their participation is critical to
the achievement of CRM goals and objectives. The CRM committee
appointed or the CRM manager should actively participate in all
aspects of the CRM implementation from the inception to the
deployment. Responsibility should be given to the appropriate
persons and ensured that they carry it through and thereby avail of
all the possible CRM benefits. Training is Essential Training
should be taken seriously. Since the implementation of CRM is a
huge task it is important to plan for individual training within
the organization for ex. classroom training, expert training etc
can be opted for so that they are enabled to possess the necessary
skills required for the job. This is an important part of CRM
implementation. Employees should be encouraged to provide feedback
on how well the CRM training has gone and whether or not they need
additional help. Implementing CRM Make sure the business is
affected to the barest minimum. See what effects the CRM
implementation will have on your business and make sure you prepare
employees for the possible jolts. It is most important to focus on
the process and allow the CRM tool to manage the process. It is
also important to include the entire business even if the CRM
project includes only one business unit. Future Focus Since the CRM
implementation will bring with it new changes and new challenges it
is imperative that the resources at hand be used to deal adequately
with possible change. It is important to focus on the possibility
that changes will undoubtedly occur in future. Plans should be made
keeping this in mind. Room should be provided for modifications and
the possibility of plans going awry as well. The business should be
well equipped to deal with these changes. Get Feedback from Users
Obtaining user feedback is essential as this can contribute to the
success of the CRM project. It yields valuable information about
CRM implementation's requirements user acceptance, etc. While
considering implementing the CRM strategy the adherence to the
above factors will go a long way in ensuring success. Getting CRM
right will ensure that customer retention is secured, sales leads
are followed and marketing is boosted. After the execution of CRM
the results need to be measured often, based on the methodology
developed. It is important to ensure that current metrics are
established. Both qualitative and quantitative measures should be
adopted, after which the results need to be analyzed and finally
based on this a methodology should be implemented.
30 | P a g e
CRM's Top Business Models are in High DemandThe purpose of
Customer Relationship Management (CRM) is to enable various
organizations serve customers better through introducing them to a
series of processes and procedures that better the buying
experience for customers. This is done through implementing a
successful CRM strategy through a software package that has been
specifically designed to support these business processes and
procedures. The work of CRM involves focusing on service automated
processes, information gathering and processing, integrating and
automating various customer serving processes in a company. It also
manages to keep track of customer preferences, buying habits, deals
with service requests, information requests, complaints etc. It
deals directly with the customer. For ex call centers use Customer
Relationship Management to store customer information. It enables
them to retrieve and store information and serve the customer
efficiently. It also helps them to encourage new customers, cater
to the needs of the older ones and basically achieve customer
retention. Finding a CRM software vendor is easy work but what's
important is getting one that works for you. The leaders in the
field include:
OracleOracle is the leader in the CRM field. The company
currently offers 50 CRM applications that are able to provide for
all the customer service requirements of small, medium and large
industries. Oracle provides CRM applications that aid the
organization through improved business processes. What does Oracle
have to offer? The answer is accurate information. In addition to
that the functionality it offers is just as important. It manages
to provide excellent support for all departments within the
organization like customer support, added services and
additional
SAPSAP was established in 1972 and is now a leader in the
provision of business solutions for all types of industries. It is
a CRM software vendor that caters to businesses worldwide and
currently serves more than 32,000 customers. SAP has a presence in
more than 50 countries. It is the world's largest business software
company. It is the world's third-largest independent software
provider overall and employs more than 35,000 people. They are able
to provide excellent customer service and support. It boasts of
having the Knowledge, Experience, and Technology that is needed to
optimize Business efficiency. It manages to provide a range of
solutions that cater to every aspect of the business.31 | P a g
e
The benefits from SAP are:y y y y y
Better efficiency Cost reduction Better performance Adaptability
to business environment Overall Growth
One advantage SAP has is that SAP Ventures invests in new
companies that are interested in finding new technologies. This
enables them to stay ahead in the rat race. SAP offers several
solutions for Customer Relationship Management and is able to
deliver customer-centric solutions that revolve around each
customer. It helps the organization to support the various
departments like marketing, sales, and service and provides them
with good analytics as well as excellent interaction capabilities.
SAP CRM supports the customer-related processes and deals with all
customer-related activities across all departments. It sources and
gathers together all customer data in the organization in order to
facilitate better decisions. It enables company's address their
business needs adequately, manages to achieve the business
objectives and reaps the required return on investment. Sales Force
This unique provider manages to provide simple yet effective
customer relationship management products that equip the business
with the capacity to increase its effectiveness. It offers a wide
range of solutions from marketing to sales force automation to
customer service and support. It boasts of being the world's first
on-demand application-sharing service. It provides customizable CRM
solutions that integrate extremely well. It aids on-demand
applications and succeeds extremely well at this. Its main feature
is its ability to manage and share information easily. Its
provisions include:y y y y y
Analytics Sales Force Automation Custom Applications Marketing
Automation Customer Service Support
Right Now Business Models Right Now Technologies provides
organizations with the necessary on demand CRM solutions that are
needed to build a customer centered business. Its appeal lies in
its technology, commitment to customer success and its ability to
deliver a high ROI and capacity to achieve customer retention. Its
clients number more than 1,400 organizations.
32 | P a g e
It is able to achieve better customer relationships that cater
to customers needs adequately. It helps organizations to understand
and deal with their customers better.Right Now manages to provide a
holistic view of the customer and the customer data. It also helps
in identifying customers, satisfying them and ultimately retaining
them. Sales revenue increases along with overall productivity and
growth. It increases the quality of service effectiveness. The
sales department as well benefits as shorter sales cycles,
increased revenue from sales, and better sales efforts. From the
marketing perspective marketing efforts are sharpened and marketing
campaigns are improved. Right Now Technologies as a CRM software
vendor has so much to offer the customer as they have exhibited
leadership in the customer service field and enables the
organization to actually focus a whole lot more on the
customer.
Increase profitability and sales with CRM integration.CRM
integration has become what is considered to be one of the best
business strategies in use by companies today. With CRM
integration, companies can create an effective marketing plan,
improve customer service and increase satisfaction, and in turn,
increase the profitability and sales of the business. Deciding to
invest in CRM integration could be the best business decision your
company could ever make. No matter what the size of your business,
choosing to move to CRM integration is as simple as understanding
exactly what CRM integration can do for you. Once the facts are
clear, your business steps to CRM integration will naturally fall
into place.
What Is CRM Integration?CRM integration is most simply stated as
the introduction and implementation of CRM integration software
into a business. In most businesses, CRM integration would include
selection of a program, installation of necessary hardware and
software, importing existing data and files, and training employees
to use the new system. Bringing CRM integration into your business
is one of the best ways to increase productivity and maximize your
business profitability. CRM integration can be done within the
organization or you can hire an outside firm to do the initial CRM
integration work for you. How Do You Start CRM Integration?
Starting CRM integration can vary depending on your specific
business and needs. The first step is to decide what type of
program would best benefit your business with CRM integration. Some
research and comparison of available projects will help you to
complete this step. Next, you must decide if your company is
capable of handling CRM integration on its own or if you should
contact outside help to make the transition seamless. Bringing in
the necessary software and equipment, setting it up, and importing
existing data would be the next step in CRM integration.
33 | P a g e
Finally, training your employees on how to best utilize the new
system would complete your companys CRM integration process
What Are The Benefits of CRM Integration?Businesses that go
through CRM integration see many different benefits. One of the
biggest benefits of CRM integration is increased business
profitability. CRM integration makes this possible through
streamlining processes to reduce the time spent on customer
relations. With just a few keystrokes, customer service, billing,
and sales information is available in the database, making each
customer contact more efficient. CRM integration also allows you to
direct your marketing plans to the most receptive audiences. This
can cut costs for marketing and advertising, while increasing
customer conversion. You can also use the CRM program to manage
your employees tasks and sales, keeping tabs on everything that is
going on within your organization. Depending on the nature of your
business, you may find even more benefits of CRM integration once
the process has been implemented.
How Can CRM Integration Apply To Your Business?No matter what
industry your company is in, the need for CRM integration is
universal. Every business provides a service or product to a
customer and keeping detailed records on customers, purchasing
history, and service needs can allow CRM integration to help you
make the most of each customer interaction. Additionally, the other
features of CRM integration, such as employee monitoring and task
delegation can help you to manage the productivity of your
employees and their customer contacts. Finally, the CRM integration
process will better prepare you to plan and organize future
business plans with detailed information and customizable reports
on your business activity and trends. CRM integration can apply to
and improve your business in any way that you find acceptable to
use the processes included.
CRM Integration and Prophet Software.One of the industry leaders
in CRM integration is Prophet Software from the Avidian Company.
This knowledgeable company offers CRM integration solutions for
businesses of all sizes. Whether you are a business that has one
employee or a hundred thousand, CRM integration is possible with
the wide range of Prophet Software solutions. Avidian can also
offer a complete package for CRM integration, including
self-training and an extensive training package for your employees
to be used to wrap up the CRM integration process. Exploring
Avidian Prophet Software solutions for CRM integration may be the
best choice for the future success and profitability of your
company
34 | P a g e
The Indian CRM MarketThis report is an Executive Survey of about
70 CRM Consultants, Users, and Vendors involved with CRM practices
and technology in India. The report is restricted to the Indian
market, and the purpose is to give an overview of the market before
investigating different aspects in further depth in subsequent
research programs. Contents 1. CRM Market Size The Market can be
sized at Rs. 50-100 Crores (1 Crore=10 million) Outsourced CRM
Services forms the largest segment 2. Market Prospects Buyers are
either low-awareness or unconvinced The market shall show slower
than expected growth 3. Market Drivers and Inhibitors Need for
improved customer service shall drive service-oriented industry
sectors to adopt CRM High cost and poor customer-orientation hold
back acceptance 4. Buyer Sectors and Vendor Recall Banking,
Insurance, and Financial Services sectors are best-fit sectors for
CRM Siebel, Oracle and Talisma emerge top-of-mind vendors 5.
Respondent Profile
1. CRM Market Size Quick Glance: The Indian CRM market can be
sized at Rs. 50-100 Crores (1 Crore=10 million) The CRM market can
be segmented into the market for software and services The services
segment includes outsourced CRM services, integration, training,
and consultancy The market for CRM services is considerably larger
than the market for CRM software Fig. 1. Sizing the Indian CRM
Market
35 | P a g e
Observations and Inferences y A clear majority of our
respondents size the Indian CRM Market at the Rs. 50-100 Crore
range but with 33% of our respondents putting the market at a size
greater than Rs. 100 Crore; there could be a higher benchmark for
the market size applicable than the Rs. 100 Crore mark. y Our
findings are in agreement with the figure most published in the
media stated by Denis Collart, the global head of PWCs CRM practice
who, in an interview in November 2000, stated that the Indian
Market for CRM Software and Services would grow to about Rs. 100
Crore by 2001. Fig. 2. CRM Market Segments
The market segments for CRM can be broadly out as the Software,
Services, and Hardware market. Our study has been restricted to the
Software and Services markets.
Fig. 3. Breakup of the Global CRM Market
36 | P a g e
This chart gives the breakup of the Global CRM Software and
Services market. The projected revenues for each of the segments
for the year 2001 from past research have been used to arrive at
the relative percentages. This breakup is merely indicative, as the
revenue projections have been taken from more than one source.
Observations and Inferences y The breakup between revenues from
various segments in the India n context is not expected to vary
from global market to a significant degree. With this assumption,
the size of the market for CRM implementations (including Software,
Integration, Consulting and Training) in India lies in the 40-60
Crore range. y Given the small market, a local vendor looking for
business is going to find himself up against tough competition.
Majority of the CRM solution providers in India do not have a
product but act as consultants and integrators for software like
Siebel, Oracle, SAP etc. providing consulting, software deployment
and integration, and training. y Outsourced CRM Services has the
maximum potential for growth, but the number of players entering
this market is growing at a significant rate. Telemarketing Firms,
Direct Marketing Firms, Data Collection firms, Market Research
firms, and even Advertising Agencies have begun to add the CRM tag
to their services. With the Call Center market finding the
international market tough going, they are increasingly turning to
the domestic market to supplement revenues.
2. Market Prospects Quick Glance: Indian firms are aware of CRM,
but are yet to take concrete steps towards implementation The
market is expected to catch on, but slower than anticipated The
overall sentiment is wait-and-watch The next two charts indicates
what our respondents feel is the stage of evolution of the Indian
CRM market and what they feel are the market prospects. Fig. 4.
Stage of evolution of the Indian Market
37 | P a g e
Fig. 5. CRM Market Prospects
Observations and Inferences y While there has been a great deal
of attention on CRM technology and practices in recent times, when
it comes to putting it in practice, the market is in a very early
stage of evolution. Most respondents felt that the Indian firms
were either unaware, or unconvinced about the benefits and
applicability of CRM. y The overall sentiment when it comes to
growth prospects is upbeat in the sense that people are convinced
that it shall take off, albeit slower than anticipated. Signals for
Solution and Service providers are that they are going to have to
stick through this early stage till the market matures in terms of
awareness and acceptance, and the number of implementations
increases. y Media reports have put the annual growth rate for the
CRM Software market in India at 25-30%, and Services market at
about 50-60%. Our respondents however feel the going shall be
slower than projected. 3. Market Drivers and Inhibitors Quick
Glance: The need for improved customer service and high global
adoption shall drive the Indian CRM market The high cost of
implementation and low awareness of benefits is going to prove a
major deterrent The next two charts indicate the factors our
respondents feel will drive acceptance of CRM in India, and the
factors that will hold back acceptance.
38 | P a g e
Fig. 6. Market Drivers
Fig. 7. Market Inhibitors
Observations and Inferences y A need for improved Customer
Service shall be the main driver for Industry sectors that depend
on the quality of their customer interactions to retain existing
customers and win new ones. High Global adoption is likely to drive
the MNCs to adopt CRM first in line with Global implementations. y
While the first hurdle holding back the market is a lack of
awareness, respondents have put high cost of implementation as the
main inhibitor. Complete and comprehensive CRM packages such as
those of Siebel and Oracle costing in the range of Rs. 1 to 2.5
Crores (and more) are too expensive for most Indian firms. However,
with software vendors bringing down prices and offering relatively
affordable packages bundled with integration and consulting
services, this could soon change. y In the Indian context, lack of
customer orientation and poor existing IT infrastructure can prove
major factors. Firms need to evolve their customer thinking by a
significant extent before they accept CRM as the strategic
imperative it is, and internal systems and database management
practices need to be upgraded before CRM software can be used to
any effect.39 | P a g e
y
Another major inhibitor indicated by respondents was that Indian
firms lack the skills and strategic vision required to successfully
implement CRM.
4. Buyer Sectors and Vendor Recall Quick Glance: Banking,
Insurance, and Financial Services are the sectors that shall
benefit most from CRM practices and technology Siebel emerges as
the most top-of-mind CRM package, followed by Oracle and Talisma
Fig. 8. Best-fit sectors for CRM practices and packages
Fig. 9. Top-of-mind CRM Packages
Observations and Inferences y Our respondents voted
overwhelmingly in favor of the Financial Services sector as the
best fit sector for CRM. Recent implementations in the banking and
financial services sector, especially those of ICICI and Citibank,
have clearly grabbed attention. y The best-fit sectors as expressed
by our respondents gives an indication as to how closely CRM is
associated with improvement in customer service. y Siebel is the
global leader when it comes to CRM software and has clearly grabbed
mindshare in the Indian market as well. While 77% of the
respondents mentioned Siebel as a known CRM vendor, Siebel was the
first CRM package that came to mind for 64% of the respondents.
40 | P a g e
y
SAP and Oracle have recently entered the Indian market with
aggressive plans targeting the SME market in particular. Both firms
are targeting a growth in the market for their products of about
30%.
5. Respondent Profile Fig. 10. Respondent Profile
Fig. 11. Respondent Involvement with CRM
Total respondents: 71
CRM Necessities for Financial ServicesThe ideal CRM solution for
any financial service company is one that effectively leverages
customer knowledge in times of intense competition and
ever-changing customer demands. How well a bank or a financial
enterprise reacts to shrinking margins and complex situations can
make a huge difference in the market. Today, CRM solutions need to
grow, from the CRM solutions that preceded them to the market, and
provide dynamic solutions to the todays ever-changing business
challenges. While early CRM solutions only provided partial
solutions to complex banking issues, there is great promise that
contemporary CRM solutions will be able to meet the wide range of
market demands. Companies have been forced to provide a range of
products and value-services to meet the growing demands of
customers. With the availability new business channels such as the
Internet,41 | P a g e
customers have the option of choosing from a larger pool of
products and services. This puts immense l institutions to have
their CRM systems in place to succeed in a competitor market place.
In addition to requesting a wide range of products and value-added
services, customers demand ease and comfort in using these products
and services. This means that companies need a CRM solution that
can capture and store real-time information in a central repository
and offer easy access to the data. Capability to segment according
to customer details (demographics, geography, occupation, services)
is a necessity for any CRM solution. Segmentation helps business
managers and leaders in strategic planning and decision-making
based upon customer behaviour. With quality data, companies can
create cost-efficient marketing campaigns to target the most
profitable customers and ensure a profitable return on investment
(ROI). CRM integration impacts the following areas: Understanding
customer portfolios Optimizing sales process Integrating
collaborative solutions Increasing customer satisfaction Analytical
CRMs: Understanding Customer Portfolios Analytical CRMs aim at
storing, analyzing and applying information from business
intelligence tools to communicate with customers. It emphasizes
customer knowledge, strategic planning, and execution as
cornerstones of a CRM initiative. Under customer portfolio
management, companies make decisions and allocate resources based
on customer value. Winning new customers and retaining profitable
customers are the responsibilities of a successful analytical CRM
program. To obtain profitability, it is critical to match service
levels to customer needs, directing less profitable service needs
to lower cost service channels. Key deliverables of an effective
analytical CRM solution are: 1. Problem formulation 2. Preparation
of definitive datasets 3. Definitive analysis using statistical
techniques, non linear pattern or deviation detection and machine
learning. 4. Visualization of results in an easily understandable
format. Developing a CRM Measurement Strategy Many businesses are
pursuing new metrics even if they are not considering CRM. However,
it is central to successful customer-focused strategies that
appropriate measures are adopted which will evaluate the companys
performance against the customers perspective. As well as hard
measures of value and retention, softer measures also need to be
incorporated and their impact on the bottom line demonstrated. Many
organizations make the mistake of not establishing new measures
before CRM is introduced. This makes it very difficult to
demonstrate the benefit and added value of the new process. Key
performance indicators are one approach, although care must be
taken to ensure they are not simply deployed as a standardized
checklist. It is important to measure what needs to be measured,
not what can most easily be measured.42 | P a g e
Benchmarking is also likely to emerge as an important new metric
for the customer-centered organization. When considering which
benchmarks to adopt, those which include a strong element of
process measurement should be favored as this allows causal links
to be demonstrated with financial performance. Many companies do
not even know their baseline metrics, including elements such as
total marketing spend or composition of their sales force. This
makes the introduction of benchmarking extremely difficult.
Evaluation of marketing activities needs to be