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[Week 4]


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[Week 4]

  1. 1. It’s The Customer, Stupid!” <ul><li>Customer Relationship Management </li></ul><ul><li>Sell-Side Architectures </li></ul><ul><li>Buy-Side Architectures </li></ul><ul><li>Supply Chain Management </li></ul>
  2. 2. Fruits Of Entrepreneurship
  3. 3. Customers Are Changing <ul><li>Demographics </li></ul><ul><li>Cocooning </li></ul><ul><li>More informed </li></ul><ul><li>Global </li></ul><ul><li>Demanding </li></ul><ul><li>Predictable (individually) </li></ul><ul><li>Innovative </li></ul><ul><li>Price sensitive </li></ul><ul><li>Channel sensitive </li></ul><ul><li>Linked/Networked </li></ul><ul><li>Technology sophisticated </li></ul>
  4. 4. Eight Critical Success Factors <ul><li>1. Target the right customers </li></ul><ul><li>2. Own the customer’s total experience </li></ul><ul><li>3. Streamline business processes that impact the customer </li></ul><ul><li>4. Provide a 360-degree view of the customer relationship </li></ul><ul><li>5. Let customers help themselves </li></ul><ul><li>6. Help customers do their jobs </li></ul><ul><li>7. Deliver personalized service </li></ul><ul><li>8. Foster community </li></ul>Source: P. Seybold, , Times Books, 1998
  5. 5. “ It’s The Customer, Stupid!” <ul><li>Basic principles of Customer Relationship Management… </li></ul><ul><li>The one-to-one enterprise must: </li></ul><ul><ul><li>Identify your customers in as much detail as possible </li></ul></ul><ul><ul><li>Differentiate your customers (needs/values) </li></ul></ul><ul><ul><li>Interact with your customers (cost efficiently and more effectively) </li></ul></ul><ul><ul><li>Customize your aspects of your enterprise’s behavior toward your customers (based on needs/values) </li></ul></ul><ul><li>“ Suddenly, marketing’s in charge!” </li></ul><ul><li>CRM is ranked by Forrester as the growth segment through the year 2005 </li></ul><ul><li>Becoming a consulting specialty - Siebel, SilkNet, Berkeley Enterprise Partners </li></ul>Source: Don Peppers, “Are You Ready for One-to-One Marketing?” HBR, January 1999
  6. 6. Observations <ul><li>Current solutions build with a vertical (functional) focus </li></ul><ul><li>Processes still internally oriented </li></ul><ul><li>Customer data management not integrated </li></ul><ul><li>Data standards missing or weak </li></ul><ul><li>Data not considered an enterprise asset </li></ul><ul><li>Incomplete technology-enabled selling environment </li></ul><ul><li>Common processes nonexistent </li></ul>
  7. 7. Customer Database <ul><li>Enterprise view of customer </li></ul><ul><ul><li>Expand beyond transactional systems view of customer data </li></ul></ul><ul><ul><li>Complete picture of customer history </li></ul></ul><ul><ul><ul><li>Purchases </li></ul></ul></ul><ul><ul><ul><li>Service calls </li></ul></ul></ul><ul><ul><ul><li>Products owned </li></ul></ul></ul><ul><ul><ul><li>Event history (campaign management) </li></ul></ul></ul><ul><li>Interdependency with other front office applications </li></ul><ul><ul><li>Bi-directional data flows increase business intelligence </li></ul></ul><ul><li>Data normalized for sophisticated reports and analyses </li></ul><ul><li>OLAP tools </li></ul>
  8. 8. Conventional Landscape Disconnected islands of automation No common data model High integration costs Version lock High license cost Call Center Sales Force Automation Customer Service & Support Web Marketing Enterprise Resource Planning E-Commerce Source: J. Gauthier, Compaq. Presentation. April 5, 1999
  9. 9. Three Perspectives We and our competitors Customers Customer's Customers Suppliers Supplier's Suppliers Buy Side Sell Side Supply Chain Management
  10. 10. Sell Side Or Storefront Catalog Shopping Cart Search Engine Configurator Pricing Payment Processing Customer Service Management Tools E-Mail Sell Side Electronic Commerce House- keeping Business-to-Business: Trilogy, TradeEx, Hitachi Business-to-Consumer: OMI, Broadvision, Netscape, OrderTrust
  11. 11. Sell-Side Architecture Firewall Financial Settlement Processes Fulfillment Center/ Processes Firewall Client Browsers Certificate Authority Internet WWW Source: META Group, Stamford, CT. Sell-Side Business Server Access Mgmt Shopping Cart Promotions Fulfillment Interface Reporting E-mail Storefront/Catalogs Configurators Personalization Cust. Mgmt/Care Payment Engine Business Rules Call Center Customer Care/Info Mgmt Back Office Database Legacy Systems Content Management Publishing/ Content Tools Media Server
  12. 12. Customer Interaction Center Marketing Sales Product Development Settlement Fulfillment Finance & Accounting Source: META Group, Stamford, CT. Customers (Internal/External) Telephone IVRS Internet E-mail Fax Video Customer Interaction Center (CIC) Call Center WAN/ VPN Branch Ofcs HQ Customer Relationship Management Systems
  13. 13. Customer Management Architecture Considerations Source: META Group, Stamford, CT. Customer Interface Systems LOBs Knowledge/Rules Systems Marketing Campaign Management Common CRM Rules Engine Data Warehouse/ Mining Master Customer DB Schema Face-to-Face Support Systems Call Centers Help Desks CSR Apps POS SFA Customer Self-Service Systems IVR Systems Online Dial-Up Kiosks Web Apps Application Systems Application Information DB DB Transaction DB Services DB Application Systems Application Information DB DB Transaction DB Services DB Application Systems Application Information DB DB Transaction DB Services DB Application Systems Application Information DB DB Transaction DB Services DB
  14. 14. CRM Drivers <ul><li>Marketing database foundation </li></ul><ul><ul><li>Data mining </li></ul></ul><ul><ul><li>Targeting and segmentation </li></ul></ul><ul><ul><li>Touch point systems </li></ul></ul><ul><li>Hybrid distribution structures </li></ul><ul><ul><li>Channels </li></ul></ul><ul><ul><li>Direct sales </li></ul></ul><ul><ul><li>Call centers </li></ul></ul><ul><li>Technology </li></ul><ul><ul><li>Internet </li></ul></ul><ul><ul><li>Front office automation products </li></ul></ul>
  15. 15. Customer Relationship Management (CRM) <ul><li>Management of customer relations </li></ul><ul><li>Understanding and building on customer value disciplines </li></ul><ul><li>Accommodating many, different customer needs </li></ul><ul><li>Managing and integrating all of a company’s (supply chain’s) resources on behalf of each customer </li></ul>Definition Processes, applications, technologies and culture that facilitate building and maintaining profitable relationships among enterprises, their customers, business partners, suppliers and employees
  16. 16. Customer Relationship Management (CRM) <ul><li>Harder to create competitive differentiation </li></ul><ul><li>Increasing reach </li></ul><ul><li>Customer empowerment </li></ul><ul><li>Ccustomer churns at all-time highs </li></ul><ul><li>Customer loyalty from customer knowledge emerges as the only sustainable differentiation </li></ul>Why care?
  17. 17. The “Business Diamond” Operating Model Management Processes Culture, Beliefs and Norms Information and Information Systems Organization, Jobs and Skills Business Processes
  18. 18. Negotiated Price Selling Order Management Back Office Management Tools Housekeeping Marketplace Electronic Commerce E-mail Member Management Payment Brokering Registration Inventory Management Bid Processing
  19. 19. Some Cost Elements Commerce Service Providers - $20 to $1000 per month UP!