MC\'s Dissertation on CRM


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the presentation of my dissertation on CRM & SME (feb 2008)

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MC\'s Dissertation on CRM

  1. 1. CRM & SMEs: the Case Study of a Telecommunications Broker Marco Castoldi Milan, 27/02/2008
  2. 2. Dissertation’s topics The assessment of CRM, the strategy which enhances the value of the relationships; Show the main issues related to CRM failure; Suggest a methodology to implement; Underline the crucial aspects to consider while implementing; Apply such methodology to a case study.
  3. 3. Contemporary issues in customer management FACTORS AFFECTING THE COMPETITIVE ADVANTAGE (Busacca 2002; Tourniaire 2003): new demand’s dynamics; technological convergence; enhancing competitive pressure; sectors’ convergence; products and services complexity; deregulation; new technologies; office automation software peaks; globalization; overload of information. Customers became sceptical and sophisticated Winning spot transactions does not guarantee a lasting competitive advantage It is crucial to focus the business models on the relationships
  4. 4. From transactions to relationships: the customer’s lifecycle
  5. 5. CRM: Enhancing the value of the relationships “CRM is about delivering value to the customer relationship, in the customer’s terms, to maximize the value of the relationship to the customer, for the customer’s benefits and the company’s profit.” (CRM Forum 2007) The value is delivered through: Customer oriented strategies; Technologies which support the relationship management Tailor made products; (datawharehouse + CRM Multiple contact channels. applications).
  6. 6. Implementation is the bet 50% - 75% of the CRM projects run in the main US companies until 2002 failed at the implementation stage (Dyche 2002); The main cause of the failure of CRM project deals with the refusal of the systems by the final users (Bligh and Turk 2004); In 2004 the 81,2% of the Italian companies used CRM only at an operational level; Implementation requires change and innovation (Information & Management 2005); Italian Companies show low rates of innovation (AITech-Assinform 2007); Italy-Europe GAP in Innovation Innovation in Managerial Practices Organizational Innovation Product Innovation Marketing Innovation Process Reengineering Overall Innovation 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Italy Europe
  7. 7. Assessing Implementation SET CRM GOALS: BUILD A BALANCED TEAM Marketing Automation; Sales Force Automation; Customer Service IMPLEMENT AT EVERY LEVEL: CHECK IMPROVEMENTS: Customer Customer Maturity Structure Organization Maturity Process Process Maturity Culture People and Motivational Maturity Technology System Maturity
  8. 8. The Case Study EUROPEAN TLCs MARKET (EITO 2007) ITALIAN TLCs MARKET (EITO 2007) 31,7% of the world; 13,6% of the European Market; over 450,000,000 customers, mostly in over 60,000,000 customers, mostly in Western Europe; North-Western Italy; Growth rate: 2,6%; Growth Rate: 3,7%; Average expense on GDP: 3,09%; Average expense on GDP: 1,96%; Big players. Big players and small providers. THE CASE STUDY ENTERPRISE: Transaction based; Same business model of other 150 players crucial to Telecom for maintaining local markets; Can be considered a Marketing & Sales unit; Reached the peak of office automation tools; Accepted the challenge of marketing innovation; Presented problems in the CRM implementation.
  9. 9. Gaps Avoiding the Implementation
  10. 10. CRM Goals and Actions
  11. 11. Evaluating Customer Maturity TLCs CUSTOMERS: ALPHA: Sophisticated and sceptical; Transaction-based; Cost saving oriented; Fragmented in the selling proposition; Overloaded of information. Operations-oriented. More strategy and management Value-based approach
  12. 12. Process Maturity The core business process was: Measurable; Repeatable; Defined; Managed. Suitable for an automation through CRM
  13. 13. Organization and Systems Maturity PRE-SALES SALES DELIVERY Marketing Call Sales Force Back Administration Actions taken: Center Office 1) islands of automation (May 2007) Mapping of the information needs; Information categories and information purposes; Data reorganization; PRE-SALES SALES DELIVERY SFA tool development; Report planning. DATABASE Marketing Call Sales Force Back Administration Center Office 2) partial view of the lifecycle of the customer (November 2007)
  14. 14. People and Motivational Maturity Over the 50% of the CRM projects run in the US until 2002 failed at the implementation stage. This is mainly due to the refusal of the systems by the final users (Bligh and Turk 2004); INVOLVEMENT IS THE KEY Bottom-up approach Gradual changes Motivation
  15. 15. Conclusions ROS 2005= 1,7% vs ROS 2006= Customer-centric approaches are 3,6% winning. Value based sales pay; Turnover PABX Q2 2006= 213.799 € Segmentation and Analytical CRM Turnover PABX Q2 2007= 407.214 € boost the sales. Q1 2007: 7 operators, 319 calls Involvement and bottom up strategies avoid the systems’ Q2 2007: 7 operators, 4949 calls refusal. 13 agendas correctly managed on the system However the whole organization has to embrace CRM; CRM is not an arrival but it is a journey, hence tuning activities are required.
  16. 16. Main References AITech-Assinform (2007), Anteprima Rapporto Assinform 2007, AItech-Assinform; Annunziato P. (2005), Imprese Per l’Innovazione [online] [Accessed 16/11/2007]; Bligh P., Turk D. (2004), CRM Unplugged, New York: Wiley; Busacca A. (2002), L’era del cliente, Milan: Il Sole 24 ore S.p.A.; CRM forum (2007), association’s website [online] [Accessed 20/09/2007]; European Information Technology Observatory (2007), The European Information Technology Observatory Report [online] %20ICT%20markets,%20March%2020071.pdf [Accessed 24/05/2007]; Gentle M. (2002), The CRM Project Management Handbook, London: Kogan Page; Kentritas S. (2007), Customer Relationship Management: The SAS Perspective, SAS Institute 2007; Levitt T. (1986), The Marketing Imagination, London: Collier Macmillan; Sarkar V. (2003), How to analyse CRM for SME [online] [Accessed 04/12/2007]; Tourniaire F. (2003), CRM, Milan: McGraw-Hill; UK Government (2004), Organization’s website [online] [Accessed 10/12/2006];