ProsesBisnisdanInformasi SuryoWidiantoro, ST, MMSI, M.Com(IS) fileThe Web has changed business. Customers have the power. Economic transformation is taking place; i.e., from transactions

Proses Bisnis dan InformasiProses Bisnis dan Informasi

Suryo Widiantoro, ST, MMSI, M.Com(IS)

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Topics covered1. Customer relationship management definition

2. CRM role in supporting business operation

3. Benefits of CRM

4. Challenges of CRM4. Challenges of CRM

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Organizations must work harder than ever to attract and retain customers retain customers where comparison shopping is the norm and competitors are just a click away.

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The Web has changed business. Customers have the power.

Economic transformation is taking place; i.e., from transactions to relationships.

Keeping customers satisfied is key. Keeping customers satisfied is key.

CRM Organization-wide strategy

Concentrates on the downstream information flow

Attract potential customers

Create customer loyalty

Portray a positive corporate image

Managers need to be able to monitor and analyze factors driving customer satisfaction.

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Companies search for ways to widen, lengthen, and deepen customer relationships:

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Customer Relationship Management (CRM) is a means of managing all aspects of a customer’s relationship with an organization to increase customer loyalty and retention and an customer loyalty and retention and an organization’s profitability

CRM uses IT to create a cross functional enterprise system that integrates and automates customer-serving processes

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Three Phases of CRM

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Evolution of CRM There are three phases in the evolution of CRM:

Reporting Analyzing Predicting

CRM Reporting Technologies help organizations identify their customers across other applications

CRM Analysis Technologies help organizations segment their customers into categories such as best and worst customers

CRM Predicting Technologies help organizations predict customer behavior, such as which customers are at risk of leaving

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OPERATIONAL AND ANALYTICAL CRM

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Architecture of a CRM Environment

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Operational CRM Supports traditional

transactional processing for day-to-day front-office operations or systems that deal directly with the customersdeal directly with the customers

Systems for customer interaction and service Enables direct interaction

with customers Personalized and efficient

customer service Access to complete

information about customer

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Sales Force Automation Component of operational CRM

Supports day-to-day sales activities: Order processing and tracking Order processing and tracking

Account and contact management

Opportunity management

Sales management

Territory management

Customer history preferences, (product and communication) management

Sales forecasting and performance analysis

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Examples of Sales Measures Tracked by SFA:1. Sales pipeline for each salesperson, including rating and

probability

2. Revenue per sales person, per territory, or as a percentage of sales quotaof sales quota

3. Margins by product category, customer segment, or customer

4. Number of calls per day, time spent per contract, revenue per call, cost per call, ratio of orders to calls

5. Number of lost customers per period or cost of customer acquisition

6. Percentage of goods returned, number of customer complaints, or number of overdue accounts

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Customer Service and Support (CSS)

Second component of operational CRM

Automation of traditional “help desk” services

Automation of traditional “help desk” services

Customer interaction center (CIC) Multiple communication

channels (blogs, Facebook, phone, face-to-face, e-mail, and so on)

Customer service anytime, anywhere through any channel

Low support cost

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Enterprise Marketing Management (EMM) Third component of operational CRM

EMM tools help a company in the execution of the CRM strategy by improving the management of CRM strategy by improving the management of promotional campaigns

EMM tools provide extensive analytical capabilities that can help to analyze the effectiveness of marketing campaigns

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Analytical CRM Supports back-office operations and strategic analysis

and includes all systems that do not deal directly with the customers

Analysis of customer behavior and perceptions Analysis of customer behavior and perceptions

Customized marketing Up-selling, cross-selling

Retaining customers

Key technologies used to create predictive models Data mining

Decision support systems

Continuous data collection and analysis is necessary.

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Customer Focused Business Processes Addressed by Analytical CRM:

1. Marketing campaign management and analysis

2. Customer campaign customization2. Customer campaign customization

3. Customer communication optimization

4. Customer segmentation and sales coverage optimization

5. Pricing optimization and risk assessment and management

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6. Price, quality, and satisfaction analysis of competitors

7. Customer acquisition and retention analysis

8. Customer satisfaction and complaint management8. Customer satisfaction and complaint management

9. Product usage, life-cycle analysis, and product development

10. Product and service quality tracking and management

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Collaborative CRM Refers to systems for providing effective and

efficient communication with the customer from the entire organization

Facilitates the sharing of information across the Facilitates the sharing of information across the various departments of an organization in order to increase customer satisfaction

Supports customer communication and collaboration with the entire organization, thus providing more streamlined customer service with fewer handoffs and loyalty

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CRM enables an organization to:

1. Provide better customer service

2. Make call centers more efficient

3. Cross sell products more effectively3. Cross sell products more effectively

4. Help sales staff close deals faster

5. Simplify marketing and sales processes

6. Discover new customers

7. Increase customer revenues

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CRM business driver

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Digital Dashboards for CRMDigital

dashboards help to visualize visualize key CRM performance metrics

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Benefit Examples

Enables 24/7/365 operation

Web-based interfaces provide product information, sales status, support information, issue tracking, and so on

Individualized Learn how each customer defines product and service Individualized service

Learn how each customer defines product and service quality so that customized product, pricing, and services can be designed or developed collaboratively

Improved information

Integrate all information for all points of contact with the customers—marketing, sales, and service—so that all who interact with customers have the same view and understand current issues

Speeds problemidentification/resolution

Improved record keeping and efficient methods of capturing customer complaints help to identify and solve problems faster

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Benefit Examples

Speeds processes

Integrated information removes information handoffs, speeding both sales and support processes

Improved integration

Information from the CRM can be integrated with other systems to streamline business processes and gain integration systems to streamline business processes and gain business intelligence as well as making other cross-functional systems more efficient and effective

Improved product development

Tracking customer behavior over time helps to identify future opportunities for product and service offerings

Improved planning

Provides mechanisms for managing and scheduling sales follow-ups to assess satisfaction, repurchase probabilities, time frames, and frequencies

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Firms can find their most valuable customers by using the RFM formula: recency, frequency, and monetary value

Organizations MUST track: Organizations MUST track:

How recently a customer purchased items

How frequently a customer purchased items

The monetary value of each customer purchase

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CRM success factors include:

1. Clearly communicate the CRM strategy.

2. Define information needs and flows.2. Define information needs and flows.

3. Build an integrated view of the customer.

4. Implement in iterations.

5. Scalability for organizational growth.

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Business benefits of CRM are not guaranteed

50% of CRM projects did not produce promised results

20% damaged customer relationships

Reasons for failure

Lack of understanding and preparation

Not solving business process problems first

No participation on part of involved business stakeholders

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