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MN7510-Implications Arising From The Implementation Of CRM Technologies

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  • Course Code: MN7510
  • University: University Of Leicester
  • Country: United Kingdom

Question:

Critically assess the implications arising from the implementation of Customer Relations Management (CRM) technologies.
 
 

Answer:

Introduction

CRM or customer relations management can be stated as one of the most significant approaches for the purpose of managing the interactions of an organization with the potential and current customers (Khodakarami & Chan, 2014). This particular approach utilizes analysis of data concerning history of each and every customer with the specific organization for improving business relationship with these customers after focusing on the growth of sales and customer retention. The software of CRM eventually consolidates the information or documents of customers within one CRM database and hence the business users could easily and promptly access or manage those (Choudhury & Harrigan, 2014). The following report outlines a brief discussion on the major implications that arise from the implementation of customer relations management technologies with relevant details.

Discussion

Customer Relations Management or CRM Technologies

CRM technology is being used for the better management of each and every interaction or relation of a specific organization with its customers (Nyadzayo & Khajehzadeh, 2016). The major goal of this type of technology is to improvise the respective business relationships and provides other benefits like improving profitability, streamlining of business processes and staying connected to customers. The management of organizational sales is also easily done with customer relations management technology. This particular solution helps in focusing on the organizational relations with other people like suppliers, vendors, customers and anyone connected with the company (Trainor et al., 2014). Regarding marketing of the company, CRM technology is quite useful for storing as well as prospecting the customer information, identification of sales opportunities, recording the service issues and even management of marketing campaigns without any type of complexity.

With the easier access and visibility of data in CRM technologies, it becomes quite easy to collaborate and then increase the productivity. These technologies could even be helpful to the companies of every size to drive business growth and hence it could be specifically advantageous to smaller businesses, in which the teams often require to find out ways for doing less (Badwan et al., 2017). The customer service issues are better managed and thus status of the orders are being checked easily. There are various types of customer relations management technology and for them, four most popular and significant vendors are Oracle, SAP, Microsoft and Salesforce. The remaining vendors are being used mainly by the smaller and medium sized enterprises or SMEs, however, these above mentioned four technologies are used by the larger organizations.

The major types of customer relations management technologies are given below:

On Premises CRM: The first and the foremost type of customer relations management technology is the on premises customer relations management (Hassan et al., 2015). This particular system puts an obligation of the administrations, security, maintenance and control of database as well as information over the organization with the help of the software of CRM. With this specified approach, the respective organization eventually purchases the licenses up front instead of getting annual subscription from the cloud based CRM provider. This CRM software exists over the organizational own servers and that user subsequently assumes about the expenses of up gradations. The on premises CRM also needs a prolonged installation procedure for the completed integration of company’s data (Soltani & Navimipour, 2016). The organizations with the most complex CRM requirements, might obtain advantages from the deployment of an on premises software. 

 


Cloud Based CRM: The second important and significant type of CRM technology is the cloud based CRM. The other names of cloud based customer relations management are SaaS and on-demand CRM technology (Padilla-Meléndez & Garrido-Moreno, 2014). With the help of this specific software, the confidential data is being stored on the external and remote network, which the organizational members could access irrespective of the time and place only with an Internet connection. The third party service provider can easily oversee the installation as well as maintenance with this cloud based CRM software and the quick and relatively easier implementation capabilities of the cloud eventually demand to the organizations with extremely restricted technological resources and expertise (Chang, Wong & Fang, 2014). The cloud based ERP is quite cost effective, however, often data security becomes a major concern for the companies. Moreover, issues of compatibility even arise as soon as the data is being migrated from the specified internal systems of the company to the cloud.

iOpen Source CRM: The third subsequent and noteworthy type of CRM technology is an open source CRM technology. This significant system eventually makes the source code available to the public and hence allowing the organizations to undertake alterations at extremely lower expenses to the company that has employed the system (Tseng, 2016). These types of systems even allow the respective addition as well as customizations of the data links over the social media channel and hence assisting them to look for the better improvisation of social CRM practices. The various platforms of open source customer relations management are SugarCRM, SuiteCRM and OroCRM and they offer several options to the registered platforms from vendors of Salesforces and Microsoft.

Implementation of Customer Relations Management Technologies

A proper implementation of CRM technology is extremely important and significant for reducing the complexities of customer management in an organization and thus this type of technology is being implemented in the organizational systems (Olszak, 2013). The entire process of CRM technology implementation is not complicated and it comprises of six distinctive steps. These six steps are as follows:

CRM Technology Review and Selection: The first and the foremost step in this process of implementation of CRM technology is the proper reviewing and selection of CRM technology. Since, there are a variety of CRM technologies, it is extremely important and significant to select the most appropriate technology (Abdul, Basri & Shaharuddin, 2013). The suitable CRM system is vital for the perfect maintenance of timely as well as cost effective project. The respective companies should even have gone through the process of selection and implementation of customer relations management. Furthermore, they offer valuable advices regarding the tools, which are being reviewed and then a correct technology is selected.

Project Management and Communication: The second important and significant step in this process of implementation of CRM technology is the management of project. The deployment of CRM system could be extremely expensive and time consuming procedure with several elements that occur in simultaneous manner (Payne & Frow, 2013). Ensuring stronger project management and then following a specific detailed strategy of communication for the core purpose of helping to keep every participant is being informed of their responsibilities. The making of communication strategy is quite vital since it helps to maintain a proper communication within the organizational management and organizational members. The vendor of customer relations management and the organization has to follow this step.

Vendor Contracting as well as Software Licensing: The third subsequent and noteworthy step in this process of implementation of CRM technology is the contracting as well as software licensing of the respective vendors. As soon as the most suitable CRM technology is being identified and selected, it is required to complete licensing of software and contracting (Anshari et al., 2015). All of these are required to set expectations of the type of technology to be implemented and how this would be supported with involvement of expenses. These projects are not supported by clearer contracts as well as licensing terms and thus often costs are incremented.

CRM System Customization: The fourth distinctive step in this process of implementation of CRM technology is the proper customization of CRM systems. Few of such systems need only primary set up or preparation before the companies could begin utilizing them; however the other systems need few of the substantial customization only before they could be deployed (Iyer & Bejou, 2014). In maximum cases, this development work would eventually affect the final product of CRM and it also considered as the most important cost element. The respective CRM developers need a proper understanding of the business rules of that specific company. This company must clarify about any undocumented or informal processes, which are affecting the CRM customization at regular intervals. This particular step ensures that the specific task is getting completed for customer satisfaction.

Migration of Data: The next important and significant step in this process of implementation of CRM technology is the proper and effective migration of confidential data. Most of the companies have their data stored within the old systems, which they want to move to the new system of CRM (Choi et al., 2013). This particular information is being organized differently from the newer systems and hence needing any more effort in relocating. Moreover, focusing on the major migration strategies can also be a major help for ensuring smooth data transfer. Data improvisation is also done in this specific step of CRM technology implementation. 

 


Training and Support: The final step in this process of implementation of CRM technology is providing effective and efficient training and support to the associated employees of an organization. The CRM technology is responsible for offering wider range of tools for the users for their learning and mastering. Every training option is properly identified and better understanding is possible with it. Few of the customer relations management technologies provide any type of self pace training, video making and written documentation in a better manner.

These above provided six steps clearly demonstrate the entire process of deployment of CRM technology within an organization to deal with the previously existing complexities of customer management in an efficient an effective manner.

Implications of the Implementation of Customer Relations Management Technologies

The various important and significant implications of the proper implementation of customer relations management technology are as follows:

Capturing of Data: This is the first and the most significant implication of implementation of CRM technology (Thakur & Workman, 2016). When new strategies are required for increment of sales in the company and also for focusing on the customers for gaining high profit margins, it is important to determine few methods to isolate all of such strategies within the sales data. This type of information could be easily determined through better observation of customers in the sales process and the staffs could enter within the organizational point of sale terminals as soon as transaction is being completed. This is termed as one of the major implication of CRM technology implementation within any specific organization.

Data Mining: The second significant implication of CRM technology in any organization is data mining. New strategies are being used for the purpose of incrementing the sales and even for focusing on the customers on the items with higher profit margins (Rahimi & Gunlu, 2016). After data is being captured successfully, this specific information could be mined within the software of customer relations management for correlating the sales initiatives with the most profitable tools and techniques. Data mining is considered as one of the most important implications that helps in reducing the major complexities of data management after data capturing. The customer impulses are much lower in this case and hence it is quite popular for the larger organizations to maintain a better relation with their customers.

Better Market Segmentation: The third subsequent implication of CRM technology is the better market segmentation. This particular software is helpful in gathering information regarding the customers after inclusion of demographic and preference data. This information can be useful for segmenting the market and even customization of the approach to every customers’ group (Almunawar & Anshari, 2014). The effect of this segmentation on the basis of CRM data is for the better adjustments of organizational strategies in better suiting the clients.

Improvement ofCustomer Retention: The next important and noteworthy implication of the CRM technology is customer retention. The total effect of this software is for incrementing the customer retention by properly serving them in a more convenient and focused manner. The effect could even be incremented by utilizing the software of CRM for implementing customer loyalty program (Law, Ennew & Mitussis, 2013). As the applications can track the respective purchases, the organization could issue reward points as well as bonuses in keeping the valuable customers. These programs even reduce expenses as sales are cheaper than the sales to new customers

Records of Purchases: The CRM system is responsible for keeping the records of all types of customer purchases as well as customer service calls. These tracking of the products is quite important for understanding the customer satisfaction and dissatisfaction issues of customers. This information is quite vital for reducing the major complexities and hence fulfilling the requirements of every customer with utmost efficiency and priority. Moreover, the costs of the targeted promotion becomes lower than marketing to any larger group and hence receiving only fewer responses.

Improvement of Customer Satisfaction: Another distinctive and significant implication of the implementation of CRM technology within any organization is better improvement of customer satisfaction (Ali et al., 2013). By proper utilization of this specific strategy, every dealing such as servicing, selling and marketing of products as well as services to the customers could be conducted in the most systematic and organized manner. Better service to the customers with the help of improvised understanding of the issues are also provided. Moreover, various issues related to customer satisfaction are also resolved by the data extracted from activities regarding organizational customers. 

 


Maximization of Business Performance: It is yet another important and noteworthy implication of the implementation of CRM technology in any company is the subsequent maximization of business performances. This is majorly done by eventually increasing the up sell as well as cross sell opportunities. Both of these selling strategies could also be conducted with the customer relations management software as the needs, requirements and patterns of purchase are being understood (Chikweche & Fletcher, 2013). With the presence of this specific information within the organizational database refers to the fact whenever any opportunity is arising, the sales team could promote as per requirement.

Better Internal Communication: After following a distinctive strategy of CRM, it helps to build up effective and efficient communication in the organization. The sharing of customer’s data within the various departments would enable in working as a team and helping to optimize the customer experiences. Every employee would even be able in answering customer questions regarding products and services. Hence, organizational efficiency is increased and better services are being offered.

Gaining Valuable Insights: The next distinct implication of the implementation of CRM technology in any company is gaining valuable insights. Since, the CRM software is majorly responsible for storing all types of data and information within one centralized location, it becomes extremely easy to properly analyse the performance as a whole (Christopher, Payne & Ballantyne, 2013). By simply pinpointing the suitable information like leads, revenue generation and the outcomes of marketing campaigns, the organization could have the core ability of generating reports. The effective reporting data refers to undertaking effective and efficient business related decisions and even improvement of revenue in the longer run.

Optimization of Marketing: There are a myriad of several CRM advantages that would improvise whatever size the businesses they comprise of. The entire marketing department of the company is being optimized and hence it is extremely popular for all types of businesses (Diffley & McCole, 2015). The revenue is increased in a better manner and in a correct time.

Theories Describing Implications of CRM Technology Implementation

There are some of the most important and noteworthy theories that could easily describe the above mentioned implications of successful deployment of CRM technology in a company. The system of CRM is helpful for the companies to stay connected to the customers, improving profitability and streamlining processes (Lam, Cheung & Lau, 2013). There are three distinctive aspects of customer relations management, which are CRM as technology, CRM as a strategy and CRM as a process. CRM as technology refers to the technology product, usually within the cloud that the respective teams utilize for recording, reporting as well as analysing the interactions within users and organizations. It is even termed as the customer relations management system and solution (Abedin, 2016). The customer relations management software even records the contact information of customers and it even automatically pull in any other information like current news regarding the activity of the organization and it could also store the details like the personal preference on communications of client.

It also organizes the information for providing a completed record of organizations and individuals for making the customer’s relationship understand in a better manner. One of the major aspect of this customer relations management approach would be that the CRM systems could compile data from a distinct range of various communication channels with inclusion of social media, electronic mails, marketing materials, organizational website and many more (Arman, 2014). With the help of this approach of customer relations management as well as the systems utilized for facilitating it and the businesses hence can learn more regarding the target audiences and how best the needs are to be needed.  It is the proper combination of technologies, strategies and practices, which the organizations utilize for managing as well as analysing the customers’ interactions and data in the entire life cycle of customer with the major objective to improvise the relations of customer services and even for assisting in the customer retention (Tzokas et al., 2015). These types of systems could even provide customer facing staff detailed data over the personal information of customers as well as concerns. 

 


The two theories for understanding the implications of CRM technology deployment are as follows:

Labour Process Theory: The first and the foremost theory that is suitable for the CRM technology implication is labour process theory or LPT. This particular theory analyses for seeking to explain the major dynamics of societal and organizational changes. The labour process eventually refers to the specific process, in which labour is being objectified or materialized within use values (Chikweche & Fletcher, 2013). This labour is the major interaction within the person, who is working in a company as well as the customers so that these organizational customers are being consciously changed in a proper manner. The major elements of the labour processes are of three fold, which are the work, the second is the object over which the work is being performed and finally the instruments that eventually facilitate the entire work process. The labour process theory ensures that there is a change in scale and scope of control.

There is a specific combination of process as well as product technologies, human labour and the most distinctive form of working organization. The direct control of this production process is being achieved by the continuous monitoring of human and even manipulation of the powered devices. Since, CRM is responsible for storing customer data and managing data within a single database, it is obvious that the organization would be benefitted with LPT usage in their business (Law, Ennew & Mitussis, 2013). One of the major implications of CRM technology implementation is that it helps in customer retention without much complexity. Labour process theory works in a similar manner; it monitors the clients and reduces the complications of systems. Moreover, the work is transformed and management is being informed with LPT and thus customer management is done easily.

Systems Theory: The second significant theory or approach that is suitable for understanding the implications of CRM technology implementation is system theory. It is an inter disciplinary theory regarding nature of the complicated systems within society, nature and science and is the core framework through which anyone could describe few objects, which work altogether in producing best results (Rahimi & Gunlu, 2016). The major elements of this systems theory are data, organization, processes and tools. These elements are required for the management of system effectively and efficiently. This kind of interaction has two components, which are input that is what is being entered into the system and output that is what the results of the system are. As per the implications of CRM technology implementation, the business performance is enhanced majorly and thus the inputs here are resources present in the company and output is the business performance. The system refers to the entire organization.

Conclusion

Therefore, from the above discussion, it can be concluded that customer relations management is a specific strategy that helps to manage the organizational relationships as well as interactions with the potential customers. The CRM as a strategy refers to the business philosophy and how the relationships with the potential customers must be managed. Finally, CRM as a process refers to that specific system, which any business is adopting to nurture or control the relationships. The interactions of customers are captured and managed within the business and thus information is to be surfaced to maintain a good relation. The effective and efficient characteristics of CRM are automation of marketing, automation of sales force, automation of contact centre, geo location technologies as well as location-based services, work flow automation, lead management, analytics, human resource management and artificial intelligence. The above provided report has clearly demonstrated the major implications from deployment of CRM technologies. 

 

References

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