Thursday, March 3, 2011

Customer Relationship Management (CRM) Software, Applications, and Business Performance

Many different products, services, processes, and systems offered across the globe have had their own unique trials and tribulations throughout their existence. Customer Relationship Management (CRM) systems are one of those products that have had success along with failure in many of the world’s markets. As more companies continue to collect and access more customer data through programs such as CRM they will continue to increase their capabilities of using this data in order to fragment it into more sophisticated client messages through web based supply chains, mobile messaging, and ecommerce technologies. As a result of these new abilities and this newly constructed dependence through CRM implementation, those companies that encourage and promote the benefits to its employees will be the ones that create a cultural climate that fosters even more client centric innovations, while increasing organizational profitability. However, I found in (Ang & Buttle, 2006) literature review that many of these same CRM systems also tend to focus too much on the software itself or “a one-size fits all approach” versus the actual use or implementation, which is or has caused many CRM implementations to add to the increases in problems or in functionality and flexibility.

Considering both the negatives and positives of a CRM implementation, (Ang & Buttle, 2006) conducted a study throughout the Australian economy that focused on customer retention, customer acquisition, and customer development. The results of their study yielded three major insights

(1) First was that less than 40% of those companies surveyed throughout Australia were found to not use any type of CRM system (i.e. market analysis, lead generation, or customer profiling) to support the their operations or clients in any way
(2) Secondly, if an organization uses a CRM system as part of their overall strategic plan, they are more likely improve their retention, acquisition, and customer development rates significantly resulting in more return on investments and increases in company profitability
(3) Lastly, an organizations overall size seemed to determine the success rates with a CRM implementation (i.e. the larger the organization the more dissatisfied they were versus the smaller organizations who most of the time seemed more satisfied with CRM software)

From (Ang & Buttle, 2006) analysis and study of CRM systems in the Australia market there are still many organizations out there that are still undeveloped or lack a clear understanding of the real benefits that CRM can provide their company and long-term strategies. It is no secret that a company’s relationship with its customers cannot only strengthen the organization internally but also externally by providing its customers with superior service and added benefits. Additionally (Ang & Buttle, 2006) show readers that those organizations that want to achieve higher customer retention, customer acquisition, and customer development are the companies that want their customers to be more satisfied, thus increasing the organizations revenues and profitability. However, in order for these systems to gain more credibility manufacturers and vendors of these programs will have to build different systems for different companies based on size and location. This is exactly what I am looking for, as I continue to look for the key elements in the research that customers are demanding, which will allow me the ability to bridge any gaps in the literature in order to see more growth, enhanced business performance, and return on investments through CRM or other technological system implementation. Therefore, this article much like the others reviewed in previous posts are providing me with all the pieces that I will require to conduct a study, make recommendations, and contribute additionally to a niche market such as customer relationship management or enterprise resource planning.

Of course, I am always searching for other opinions, so if you got one let me hear it, as I continue upon in my research. Until next time-- Keep Smiling

Ang, L., & Buttle, F. (2006). CRM software applications and business performance. Journal of Database Marketing & Customer Strategy Management, 14(1), 4 - 16.

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