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  1. 1. CUSTOMER RELATIONSHIP MANAGEMENT CRM Hitesh Kumar Srivastava Asst. Professor GBAMS, Mirzapur
  2. 2. Unit - I
  3. 3. What is CRM Customer relationship management (CRM) is a model for managing a company’s interactions with current and future customers. It involves using technology to organize, automate, and synchronize sales, marketing, customer service, and technical support. CRM “is a business strategy that aims to understand, predict and manage the needs of an organisation’s current and potential customers”
  4. 4. Definition of CRM “CRM is concerned with the creation, development and enhancement of individualised customer relationships with carefully targeted customers and customer groups resulting in maximizing their total customer life-time value”.
  5. 5. The purpose of CRM  Help a business to keep customers.  It helps the business to understand what it needs to do to get more customers.  Reduce costs by managing costly complaints and finding out what services are useless for customers.  Help a company figure out if its product is working and, ultimately, increases profit.  Prime reason is to log and manage customer relationships.
  6. 6. Stages of Customer Relationship  Visitor - The online CRM is the entry portal to your company, however the visitor finds you. Whether they visit with your representatives at a trade show, or fill out a web form, they enter the front door of your virtual company and into the online CRM to be greeted with a welcome and offered something valuable to them. WARNING: Do not skip this important stage or your emails may be rejected later.  Engaged Visitor - online CRM is able to engage the sales lead and rescue your sales. The first place you engage the visitor is in the welcome email. Be gracious and welcoming.
  7. 7.  Prospect In some companies, just clicking on the link to the first offer will convert the sales lead into a prospect. It may be time to have your salespeople call to offer help and guide the sale. Whatever the sales process for your product or service, an email campaign delivered in your online CRM is the most engaging and personal way to get them to pay attention to your message.  Customer Way too many companies stop courting the business after they have become a customer. Some feel that customers are not loyal anyway, so what’s the point? Others believe that if they concentrate their effort on delivering good products and excellent service – it will be enough to earn whatever loyalty is possible.
  8. 8.  Advocate In an online world where customers can post their experience with your company to be seen by anyone who may be interested – customers have the enviable power to make or break your business. As demonstrated by such companies as Apple, Amazon and more, devout loyalty is possible when customers feel important. They feel deeply attached to the companies who make them feel valued and heard.
  9. 9. Relationship Marketing  Relationship marketing was first defined as a form of marketing developed from direct response marketing campaign which emphasizes customer retention and satisfaction, rather than a dominant focus on sales transactions. Marketing activities that are aimed at developing and managing trusting and long-term relationships with larger customers. In relationship marketing, customer profile, buying patterns, and history of contacts are maintained in a sales database, and an account executive is assigned to one or more major customers to fulfill their needs and maintain the relationship.
  10. 10. Purpose of relationship marketing  Satisfaction Today’s customers face a growing range of choices in the products and services they can buy . They are making their choice on the basis of their perceptions of quality, service, and value. Companies need to understand the determinants of customer value and satisfaction.  Retention To create customer satisfaction, companies must manage their value chain as well as the whole value delivery system in a customer-centered way. The company’s goal is not only to get customers, but even more importantly to retain customers. Customer relationship marketing provides the key to retaining customers and involves providing financial and social benefits as well as structural ties to the customers. Companies must decide how much relationship marketing to invest in different market segments and individual customers, from such levels as basic, reactive, accountable, proactive, and full partnership
  11. 11. CRM cycle There are four phases to the customer life cycle. The four phases include; marketing, customer acquisition, relationship management, and loss. Marketing The marketing part of the customer life cycle is when messages are sent to the target market to attract prospect customers. Customer Acquisition The next phases is customer acquisition which means prospects become customers when they place an order. Relationship Management The third stage is relationship management. Relationship management is when resell processes increase the value of existing customers. Loss/Churn The end stage of a customer life cycle is loss/churn when inevitably in time a company may lose a customer. The company then needs to establish a win-back process. The company then needs to decide which lost customers are of most value and try to win back their business.
  12. 12. CRM cycle A CRM system integrates all four phases of the customer life cycle into three major processes. These processes are solicitation, lead-tracking, and relationship management. The diagram above depicts the four phases and the three major processes. It shows the flow of phases and what each phase means.
  13. 13. Types of CRM Nowadays, three major types of customer relationship management systems, namely operational CRM, analytical CRM and collaborative CRM are being used in many organizations. Operational CRM It provides support to front-office business processes that involve direct interaction with customers through any communication channel, such as phone, fax, e-mail, etc. The details of every interaction with customers, including their requirements, preferences, topics of discussion etc., are stored in the customers’ contact history and can be retrieved by the organization’s staff whenever required. Thus, it presents a unified view of customers across the organization and across all communication channels. Examples of operational CRM applications are sales force automation (SFA), customer service and support (CSS), enterprise marketing automation (EMA),etc.
  14. 14. Analytical CRM It enables to analyze customer data generated by operational CRM applications, understand the customers’ behavior, and derive their true value to the organization. This helps to approach the customers with related information and proposals that satisfy their needs. The analytical customer relationship management applications use analytical marketing tools like data mining to extract meaningful information like the buying patterns of the customers, target market, profitable and unprofitable customers, etc., that help to improve performance of the business.
  15. 15. Collaborative CRM It allows easier collaboration with customers, suppliers, and business partners and, thus, enhances sales and customer services across all the marketing channels. The major goal of collaborative customer relationship management applications is to improve the quality of services provided to the customers, thereby increasing the customers loyalty. Examples of collaborative CRM applications are partner relationship management (PRM), customer self-service and feedback, etc.
  16. 16. Success Factors In CRM  Evaluate current customers’ impact on business. CRM must start with determining what kind of customer information the company is looking for and what it intends to do with the information.  Evaluate business environment to understand how current customer relationships impact business retention and growth.  Develop a strategy that is well expressed to give clear direction and value to all employees
  17. 17.  Evaluate and update the strategy  The goal is to lock customers into a mutually beneficial long- term relationship. The CRM strategy aligns an entire organization toward customers in a way that benefits partners, suppliers and improves the financial bottom line
  18. 18. Facts of CRM CRM is methodology to achieve global excellence through customer satisfaction. it tracks customer history, need and co-ordinates company’s multi-pronged interaction with its customer for business excellence.CRM tentacles every area of business. These are.—  Customer Needs  Customer Response  Customer Satisfaction  Customer Loyalty  Reclaiming Lost Customer  Customer Complaint  Customer service
  19. 19. Importance of CRM CRM helps the organization to identify customer needs and re-focus its strategy to serve his better. It helps the company to archive business growth through development edge and excellence. Some of the major issue it address are:  Identify customer needs.  Helps in rediscovering the customer and understanding him.  Identify untapped business potential.  Identify strong and weak points of supplier.  Provide feedback to the supplier on his total operation.  Provide feedback and new information on competitors.  Action plan to make organization customer – centric.
  20. 20. Stakeholders in CRM Firms also use relationship marketing techniques to build mutually supportive bonds with stakeholders other than consumers. The 4 stakeholder groups most affected by CRM are: Employees. Difficult to convince buyers when employees are not happy. Employee relationship building is handled by human resources departments. Employees are instrumental in building relationships with customers = they have to be trained + to have access to data & systems used for relationship management. Business customers in the supply chain. Business customers (the B2B market): uses Internet technologies to work with numerous wholesale and retail intermediaries. Firm’s suppliers: uses the Internet to receive bids from its suppliers (lowers transaction costs + enhances competition + speeds order fulfillment).
  21. 21. Stakeholders 3. Lateral partners.  Other businesses that join with the firm for some common goal but not for transactions with each other (not-for-profit organizations, or governments). 4. Consumers.  The individuals who are end users of products and services.  Marketers must differentiate between business customers and final consumers because different tactics are often employed in the B2C and B2B markets.
  22. 22. CRM Implementation •Customer Segmentation Based on Customer Life time value •Customer Profiling •Offer Customization •Matching Service Cost and Revenue •Employee Participation in CRM Design •Motivating Employees for Effective Implementation •Making CRM an Enterprize wide Activity •Adequate technology Support for CRM Implementation •Consistency testing of CRM Programs •CRM Practice Evaluation Form
  23. 23. UNIT - II
  24. 24. Satisfaction 1. The fulfillment or gratification of a desire and need. 2. Pleasure or contentment derived from such gratification. 3. A source or means of gratification. 4. Satisfaction is feeling that emanates from fulfillment of needs and wants. 5. Satisfaction is evaluated based on what is received against what was expected.
  25. 25. Customer Satisfaction Customer satisfaction is a measurement of how pleased customers are with a particular product or service. Satisfied customers are likely to make repeat purchases and often refer others. How to Increase Customer Satisfaction in 3 Steps 1. Justify the Sale with Social Proof When most sales are made, chances are that the buyer will have to justify the purchase to another person – a boss, spouse, or anyone that may pass judgment. To make this go smoothly, you should arm each one of your customers with testimonials from other people and companies.
  26. 26. 2. Surprise Customers with a Bonus When people spend money on a product, the last thing you want them to think is “was this worth it?” To combat this, you should surprise each one of your customers with a little bonus. 3. Offer Free Product Training and Support This is a clear, business-winning decision. Nothing decreases customer satisfaction more than being confused with how to make a product work. And free product training and support will be how you alleviate this customer frustration.
  27. 27. Components of Customer Satisfaction •For better understanding of customer satisfaction components need to be discussed as ultimately satisfaction is dependent on large number of factors. Customers are satisfied whenever they consistently receive:  1. A perfect product  2. Delivered by a caring, friendly person in a timely fashion  3. The support of an effective problem resolution process.  •Brodeur Berry defined some Quality Values and Quality Characteristics.
  28. 28. QUALITY VALUE QUALITY CHARACTERISTICS Quality Best Services and high quality reputation of suppliers. Front line Service Behaviors Courtesy, friendliness, attentiveness and keenness. Timeliness Error free processing. Efficiency On time delivery. Inter-departmental Teamwork Professional appearance..
  29. 29. Customer satisfaction Model: (Teboul Model)
  30. 30. Customer satisfaction Model: (Teboul Model) Company offer Customer needs (product or service) Customer satisfaction Needs not fulfilled Total satisfaction is achieved when offer matches the need i.e. circle is superimposed on the square
  31. 31. Rationale of Customer Satisfaction  Application of the concept of customer satisfaction provides numerous benefits to the organizations. These benefits are as follows:  –Customer Satisfaction building loyalty.  –Customer Satisfaction helping in customer retention.  –Customer Satisfaction strengthening customer’s repurchase intention.  –Customer Satisfaction leading to superior business performance .
  32. 32. Measuring Customer Satisfaction  Customer satisfaction measurement provides an indication of how successful organization is at providing goods and or/services to the market place.  Customer satisfaction is key factor in determining the success of organization in customer satisfaction .
  33. 33. Need of Measuring Customer Satisfaction  As satisfied customer is base of optimal performance and financial returns.  Customers are viewed as a group whose satisfaction with the enterprise must be incorporated in strategic planning efforts.  Forward looking companies are finding values in directly measuring and tracking customer satisfaction as an important strategic success indicator.
  34. 34. Measurement of Customer Satisfaction  There are number of scales and models are used in evaluating customer satisfaction . Few are listed below. KANO MODEL THE COMMON MEASUREMENT TOOLS [CMT] AMERICAN CUSTOMER SATISFACTION INDEX [ACSI] CUSTOMER SATISFACTION INDEX [CSI]
  35. 35. Customer Satisfaction and Marketing Program Evaluation  Why would a marketing publication, namely Marketing News, devote a special section entirely to customer satisfaction?  A better question might be, why spend thousands or millions of dollars in creating a product or concept and then spend thousands or millions of dollars in advertising to drive people to the product or service, if you don’t know what you are doing to the customer when they finally do come into your business?  People spend money when and where they feel good.  Companies use to monitor all aspects of in-store marketing, from long- term programs to new product rollouts.
  36. 36.  You can create the most brilliant campaign, but if it is not executed properly or at all, it won’t get the desired results. Sometimes marketing departments get disappointing first- month results and realize more communication and training is in order to make the campaign work.  Measuring and monitoring performance and delivery of product and service is not a new concept; people have a tendency to do more of what you inspect rather than what you expect.  In today’s competitive business environment, front-line understanding of the steps and details of delivery of a product or promotion is more critical than ever
  37. 37. Unit - III
  38. 38. Service Quality An assessment of how well a delivered service conforms to the client's expectations. Service business operators often assess the service quality provided to their customers in order to improve their service, to quickly identify problems, and to better assess client satisfaction.
  39. 39. Issues in Service Quality  Evaluation of service quality is more difficult as compared to goods quality.  Service quality is comparison between expectations and performance.  Service quality evaluation involve outcomes and processes.
  40. 40. Definition • Parasuraman describes Service quality as “the ability of an organization to meet or exceed customer’s expectations.” • Lloyd-Walker and Chueng said that “service quality is considered not only to meet but to exceed customer expectations, and should include a continuous improvement process.”
  41. 41. Types of Service Quality • Concrete measurable conformity of a working result with the previous defined benefits. Objective Service Quality • Customers’ perceived conformity of the working result with the customer ‘s original imagination of the service. Subjective Service Quality
  42. 42. Dimensions f Service Quality As per Parasuraman (1985) 10 determinants were identified which are as follows:
  43. 43. Parasuraman further modified the list in 1988
  44. 44. Service Quality Gap
  45. 45. Service Quality Gap There are seven major gaps in the service quality concept , which are shown in Figure· Gap1:Customers’ expectations versus management perceptions: as a result of the lack of a marketing research orientation , inadequate upward communication and too many layers of management. Gap2:Management perceptions versus service specifications: as a result of inadequate commitment to service quality , a perception of unfeasibility , inadequate task standardisation and an absence of goal setting. Gap3:Service specifications versus service delivery: as a result of role ambiguity and conflict, poor employee-job fit and poor technology-job fit , inappropriate supervisory control systems , lack of perceived control and lack of teamwork.
  46. 46.  Gap4: Service delivery versus external communication: as a result of inadequate horizontal communications and propensity to over - promise.  Gap5: The discrepancy between customer expectations and their perceptions of the service delivered: as a result of the influences exerted from the customer side and the shortfalls (gaps) on the part of the service provider . In this case ,customer expectations are influenced by the extent of personal needs , word of mouth recommendation and past service experiences.  Gap6:The discrepancy between customer expectations and employees’ perceptions: as a result of the difference s in the understanding of customer expectations by front-line service providers.  Gap7: The discrepancy between employee’s perceptions and management perceptions : as a result of the differences in the understanding of customer expectations between manager sand service providers.
  47. 47. Measure For Bridging Service Quality Gap Gap1: Customers’ expectations versus management perceptions •Have better understanding of customers’ need and expectations. •By facilitating and increasing direct interaction managers and customers. •By improving upward communication . •By using and turning insights into action.
  48. 48. Gap2: Management perceptions versus service specifications : •By insuring that top management displays ongoing commitments. •By getting the middle management to set, communicate and reinforce customer oriented service standard. •By training managers. •By standardizing repetitive work task to ensure consistency and reliability. •By establishing clear service quality goal. •By clarifying to employees to which tasks have biggest impact on quality. •Measuring performance. •Rewarding managers and employees for attaining quality goals.
  49. 49. Gap3: Service specifications versus service delivery: •By clarifying employees goal. •By ensuring that all employee understand how their job contribute to customer satisfaction. •By matching employees to job. •By providing employees with the technical training. •By developing innovative recruitment and retaining method. •By teaching employees about customers’ expectations. •By eliminating role conflicts among employees. •By training employees in priority setting and time management. •By building teamwork •By treating customer as partial employee and clarifying their role in service delivery.
  50. 50. Gap4: Service delivery versus external communication: • By seeking input from operations persons when new advertisement program are being created. • By developing advertisements that feature real employee performing their job. • By allowing service provider to preview the advertisement. • By getting sales staff to involve operation staff in face-to-face meeting with the customer. • By getting internal educational, motivational and advertising campaigns. • By ensuring that consistent standards of service are delivered across multiple locations.
  51. 51. Gap5: The discrepancy between customer expectations and their perceptions of the service delivered:  •By Keeping customer informed.  •By briefing the customer at the end of service delivery.  •By offering tangibles evidence to the customers to assure them.  •By taking customer into confidence about the service being offered.
  52. 52.  Gap6: The discrepancy between customer expectations and employees’ perceptions:  Gap7: The discrepancy between employee’s perceptions and management perceptions:
  53. 53. Service Quality Measurement Scale •Proposed by Parasuraman: •Identified 22 variables: •22 Variables of Service Quality Measurement Scale  Modern Looking Equipments  Physical Facility is visually appealing  Employees are dressed and neat appearing  Material and tolls are visually appealing  Promise is always kept  Show great concern for solving problem  Perform better service right from the first time
  54. 54. •Provide service at the time agreed on •Tell the exact time of service delivery •Error free records •Provide prompt service to the customers. •Employees always willing to help the customers •Employee never be busy to help the customer •Impressive behaviour of the employees •Customers feeling about safety •Employees friendly and courteous nature •Knowledge to answer question of the customer •Individual attention on customer •Opening and closing hours •Employees personal attention on each other •Customers best interest at heart •Understanding needs of their customers
  55. 55. UNIT - IV
  56. 56. What is E-CRM? E-CRM This concept is derived from E-commerce. It also uses net environment i.e. internet. Electronic CRM concerns all forms of managing relationships with customers making use of Information Technology (IT). E- CRM is enterprises using IT to integrate internal organization resources and external marketing strategies to understand and fulfill their customers needs. Comparing with traditional CRM, the integrated information for E- CRM intra organizational collaboration can be more efficient to communicate with customers
  57. 57. ECRM Features General Entirely web-based. Through ECRM application Contact with customer is made through the phone and fax. Besides, all the other traditional methods are used in addition to Internet, email, and wireless technologies. Geared more toward front end, which interacts with the back-end through use of ERP systems, data warehouses, and data marts. Personalized individual views based on purchase history and preferences. Individual has ability to customize view. System can be designed based on customer needs. Web application designed for enterprise-wide use. Reduction in time and cost. Implementation and maintenance can take place at one location and on one server.
  58. 58. Security  Users can be defined with access to only certain options using a role based model.  Options applicable to certain roles can be graphically configured and users defined as fulfilling a given role.  Pages can be encrypted using SSL and ECRM can be configured to only display pages using SSL to ensure that all information passing over the internet is encrypted.  Users can be defined to see only certain modules on the main menu - so menu options that they will not have access to be not even displayed on screen.  HTTP security can be configured over the top of the inbuilt security to provide two levels of security the first to access the web-server at all and the second to actually get into web- Based ERP.  An audit trail of which users did what is retained and is automatically maintained based on how long the information is required to be kept.
  59. 59. Advantage of E-CRM Increased customer loyalty An effective ECRM system lets a company communicate with its customers using a single and consistent voice, regardless of the communication channel. This is because, with ECRM software, everyone in an organization has access to the same transaction history and information about the customer. Information captured by an ECRM system helps a company to identify the actual costs of winning and retaining individual customers. Having this data allows the firm to focus its time and resources on its most profitable customers
  60. 60. More effective marketing Having detailed customer information from an ECRM system allows a company to predict the kind of products that a customer is likely to buy as well as the timing of purchases. In the short to medium term, this information helps an organization create more effective and focused marketing/sales campaigns designed to attract the desired customer audience. ECRM allows for more targeted campaigns and tracking of campaign effectiveness. Customer data can be analyzed from multiple perspective to discover which elements of a marketing campaign had the greatest impact on sales and profitability
  61. 61. Improved customer service and support An ECRM system provides a single repository of customer information. This enables a company to serve customer needs quickly and efficiently at all potential contact points, eliminating the customer’s frustrating and time-consuming “hunt” for help. ECRM-enabling technologies include search engines, live help,e-mail management, news feeds/content management and multi-language support. Withan ECRM system in place, a company can:  •more accurately receive, update and close orders remotely  •log materials, expenses and time associated with service orders  •view customer service agreements  •search for proven solutions and best practices  •subscribe to product-related information and software patches  •access knowledge tools useful in completing service orders
  62. 62.  Greater efficiency and cost reduction Data mining, which is the analysis of data for exploring possible relationships between sets of data, can save valuable human resources. Integrating customer data into a single database allows marketing teams, sales forces, and other departments within a company to share information and work toward common corporate objectives using the same underlying statistics
  63. 63. Voice Portal A voice portal (sometimes called a vortal) is a Web portal that can be accessed entirely by voice. Ideally, any type of information, service, or transaction found on the Internet could be accessed through a voice portal. A mobile user with a cellular telephone might dial in to a voice portal Web site and request information using voice or Touchtone keys and receive the requested information from a special voice-producing program at the Web site. Voice portal interaction may involve audible speech, speech recognition or a telephone keypad interface. There are two major categories: A consumer voice portal provides general access to information; an enterprise voice portal provides customized access to customer support.
  64. 64. Virtual Customer Representative In customer relationship management (CRM), a virtual agent (sometimes called an intelligent virtual agent, virtual rep or v-rep) is a chatterbot program that serves as an online customer service representative for an organization. Because virtual agents have a human appearance and respond appropriately to customer questions, they lend automated interactions a semblance of personal service. Combining artificial intelligence with a graphical representation, virtual agents are increasingly used in CRM to help people perform tasks such as locating information or placing orders and making reservations. Customer response to the use of virtual agents has been largely positive. Typically, people talk to a virtual agent longer than they do to an actual person, perhaps because talking to a responsive, personalized computer program is a novelty. Virtual agents are usually scripted to respond to a wide variety of questions and remarks.
  65. 65. Functional Component Of CRM CRM applications are a convergence of functional components, advanced technologies and channels. Functional components and channels are described below: Sales applications Common applications include calendar and scheduling, contact and account management; compensation; opportunity and pipeline management; sales forecasting; proposal generation and management; pricing; territory assignment and management; and expense reporting. Marketing applications These include web based and traditional marketing campaign planning, execution, and analysis; list generation and management; budgeting and forecasting and marketing materials management. Customer service and support applications. These include customer care; incident, defect and order tracking; field service; problem and solution database; repair scheduling and dispatching; service agreements and contracts; and service request management.
  66. 66. Database Management System (DBMS) A database management system (DBMS) is a collection of program that enables you to store, modify, and extract information from a database. There are many different types of DBMSs, ranging from small system that run on personal computer to huge systems that run on mainframes. The following are examples of database application:  computerized library systems  automated teller machines  flight reservation systems  computerized parts  inventory systems Some DBMS examples include MySQL, Microsoft Access, SQL Server, Oracle, RDBMS, and FoxPro etc.
  67. 67. Database Construction  A good database is designed for a specific use and is constructed with the possibility of growth. Like web sites, "one size fits all" only ensures that our database may not have the flexibility we need. Our database may fail to collect the information that we want and need for our business; or it may fail to provide our customers all the information they need to made a purchasing decision.
  68. 68. Definition of Data Warehouse The electronic storage of a large amount of information by a business. Warehoused data must be stored in a manner that is secure, reliable, easy to retrieve and easy to manage. The concept of data warehousing originated in 1988 with the work of IBM researchers Barry Devlin and Paul Murphy. The need to warehouse data evolved as computer systems became more complex and handled increasing amounts of data.
  69. 69. The Data Warehouse Architecture The architecture consists of various interconnected elements:  Operational and external database layer – the source data for the DW  Information access layer – the tools the end user access to extract and analyze the data  Data access layer – the interface between the operational and information access layers  Metadata layer – the data directory or repository of metadata information
  70. 70. Components of the Data Warehouse Architecture
  71. 71. The Data Warehouse Architecture Additional layers are:  Process management layer – the scheduler or job controller  Application messaging layer – the “middleware” that transports information around the firm  Physical data warehouse layer – where the actual data used in the DSS are located  Data staging layer – all of the processes necessary to select, edit, summarize and load warehouse data from the operational and external data bases
  72. 72. Data Mining Process of semi-automatically analyzing large databases to find patterns that are:  valid: hold on new data with some certainty  novel: non-obvious to the system  useful: should be possible to act on the item  understandable: humans should be able to interpret the pattern Also known as Knowledge Discovery in Databases (KDD)
  73. 73. Characteristics Of A Data Mining System  Large quantities of data The volume of data so great it has to be analyzed by automated techniques e.g. satellite information, credit card transactions etc.  Noisy, incomplete data Inexact data is the characteristic of all data collection.  Complex data structure conventional statistical analysis not possible  Heterogeneous data stored in legacy systems
  74. 74. DATA MINING TOOLS Most data mining tools can be classified into one of three categories: 1. Traditional data mining 2. Dashboards 3. Text-mining
  75. 75. Traditional Data Mining Tools. Traditional data mining programs help companies establish data patterns and trends by using a number of complex algorithms and techniques. Dashboards Installed in computers to monitor information in a database, dashboards reflect data changes and updates onscreen — often in the form of a chart or table — enabling the user to see how the business is performing. Text-mining Tools The third type of data mining tool sometimes is called a text-mining tool because of its ability to mine data from different kinds of text — from Microsoft Word and Acrobat PDF documents to simple text files, for example. These tools scan content and convert the selected data into a format that is compatible with the tool's database, thus providing users with an easy and convenient way of accessing data without the need to open different applications.
  76. 76. DATA MINING TECHNIQUES In addition to using a particular data mining tool, internal auditors can choose from a variety of data mining techniques.  Artificial neural networks  Decision trees  Nearest-neighbor method.
  77. 77. Artificial neural networks Neural networks have been used to solve a wide variety of tasks that are hard to solve using ordinary rule-based programming, including computer vision and speech recognition. Decision trees It is tree-shaped structures that represent decision sets. These decisions generate rules, which then are used to classify data. Auditors can use them to assess, for example, whether the organization is using an appropriate cost-effective marketing strategy that is based on the assigned value of the customer, such as profit
  78. 78. The Nearest- neighbour Method This Method classifies dataset records based on similar data in a historical dataset. Auditors can use this approach to define a document that is interesting to them and ask the system to search for similar items.
  79. 79. Significance of Data Mining 1. Significance of Data Mining In today’s competitive world, every business has to fight huge competition to achieve success. So it is necessary for every business organization to collect large amount of information like employee’s data, Sales data, customer’s information, market analysis reports, etc 2. Sales and transactions, detection of beneficial patterns, minimizing risk and increasing ROI [Return on Invesment] and understanding clear business problems and goals
  80. 80. Call Center Telephone service facility set up to handle a large number of (usually) both inbound and outbound calls. Some firms, however, specialize only in calls that are inbound (for assistance, help, or ordering) or outbound (for sales promotion or other messages). Most telephone orders are handled by call centres and not by the manufacturers or suppliers of goods or services.
  81. 81. Multimedia Contact Center Allowing customers to choose the contact method most convenient for them - phone, e-mail, fax, SMS, chat or web – provides an overall improved customer experience.
  83. 83. Web Phones  It is also known as Internet Protocol telephony. Web phone technology supports voice communication over the internet, obviating the need for the telephone network. this allow a fuller integration of voice and textual data. several companies including 3Com,Cisco and Mitel are experimenting with IP telephony system that can be applied to CRM
  84. 84. UNIT -V
  85. 85. CRM: Emerging Perspectives Developing customer relationships was there even in the pre-industrial era but in recent times de- intermediation process in many industries has accelerated the evolution of CRM. Airlines, banks, insurance, computer program software, and household appliances are using computer and telecommunication technology to directly interact end-customers Databases and direct marketing tools give industries the means to individualize their marketing efforts.
  86. 86. RECENT SUCCESSSES  On-line Banking  Direct selling of books  Automobiles and insurance  Growth of service economy and total quality management have driven adoption of CRM  Partner relationship with suppliers and customers for TQM, JIT and MRP seen at Toyota, GM , IBM, Ford and Motorola
  87. 87. Employee- Organisation Relationship The employee play a very vital role in the growth of the organization also as they are the one who actually buy the service organization's business concept and concretize it by providing their knowledge, skill, effort and time. they interact with all other stakeholders and satisfy the interest of each of the stakeholders. the Organization ,in turn, fulfils the employees physiological, security, and social needs. they also inherits several attribute of customer and hence, are called customer. “If the customer is the purpose of business ,employee are the means to achieve the purpose“.
  88. 88. Employee- Customer Linkage Radclyffe group conducted a study of call center and found that “satisfied” contact center employees make for satisfied and loyal customers. Customer decide whether or not to make future purchasing decisions with company, or to recommend its service to other, as a direct result of their experiences with a contact center representative. Organization must do short-term investment in employee satisfaction efforts through employee training, good working condition, standard pay and perquisites, participation in management, employee empowerment etc. companies essentially need to adopt following practices to leverage their resources of employee.  Better working condition for employee  higher salary  trained staff  employee empowerment
  89. 89. Factors effecting employee’s customer oriented behavior • Overwork Employee Behavior • Fatigue Employee Behavior • Interpersonal Issue Employee Behavior • Freedom Employee Behavior • Role of Decision Making Employee Behavior • Mutual Trust Employee Behavior
  90. 90. Essentials of building employee relationship Since the employee are the pillars for the companies building of relationship with the customer. a deliberate and well – thought –out initiative is required by the companies to build foundation for a strong relationship of employee with the organization.
  91. 91. Essentials of building employee relationship Recruitment And Selection Recruitment strategy from customer perspective Finding persons of customer first orientation Building employee customer parity Employee Motivation Sharing Customer profile Directing to remain focused Training and Development Training with customer – first approach Training to listen to the customer Training to build empathy with customer
  92. 92. Employee Customer Orientation Influencing employee behavior towards customer Employee Participatio n Communica tion strategic view of manageme nt Incorporati ng customer service in appraisal Motivating employees for service innovation Livening growth path with customer service orientation Providing learning opportunity
  93. 93. Service Recovery
  94. 94. Service Failure 1 2 3 4 5 6 7 8 9 Expected Service Above expectation (great service) Below expectation (poor service) Zone of Tolerance Service Failure is the process of NOT keeping promises
  95. 95. Service Failure – Two Topics Perception&Zone ofTolerance
  96. 96. Part One: Causes
  97. 97. 1 2 3 4 5 6 7 8 9 Service Failure - Causes The equipment Actions (& inactions) of staff The systems The process Actions of the customer Actions of other customers The facilities and environment The expectations
  98. 98. Service Failure - Causes The equipment Actions (& inactions) of staff The systems The process Actions of the customer Actions of other customers The facilities and environment The expectations The Service Provider Becomes Responsible for Managing
  99. 99. Part Two: Responses
  100. 100. Responses 1 2 3 4 5 6 7 8 9 Expected Service Above expectation (great service) Below expectation (poor service) Zone of Tolerance Customers Have Choices Put up with it Complain Leave BADGOOD
  101. 101. Complaining is Good? THE LOGIC: 1. The Perception of the Customer Determines Service Quality 2. Perception is intangible and may be invisible 3. Complaining makes it visible 4. Unless it is visible the Service Provider cannot respond
  102. 102. Customer Choices THE SERVICE PROVIDER CAN ONLY RESPOND IF THEY KNOW ABVOUT THE FAILURE Put up with it Complain Leave What Happens • Little opportunity to influence by service provider • Customers spread bad word of mouth • Customers left are gone for good How do Customers Decide • Bond (e.g. contracts, knowledge etc.) • Strength of dissatisfaction • Switching costs • Willingness to complain • Significance of service • Past relationship What Happens • Opportunity to influence by service provider • Opportunity to learn and adjust service Service Recovery Process GOOD BAD
  103. 103. Service Recovery 1 2 3 4 5 6 7 8 9 Expected Service Above expectation (great service) Below expectation (poor service) Zone of Tolerance 7 8 9 Service Recovery: is the process for resolving Failures that maintains the perception of quality Service Recovery Paradox: Can Service Recovery increase satisfaction with service to levels above normal service?
  104. 104. The Concept of Justice A Service Failure represents an expectation not met, for a customer this is like a BROKEN PROMISE The customer wants to see JUSTICE Distributive Size of recompense matches degree of failure Procedural Process is consistent and transparent Interactional Behaviour of service provider appropriate for degree of failure
  105. 105. The Implications of Justice Distributive Size of recompense matches degree of failure Procedural Process is consistent and transparent Interactional Behaviour of service provider appropriate for degree of failure Frequent, trustworthy communication Appropriate compensation Appropriately trained staff high-pitched wheel Opportunistic claims Unrealistic expectations Basis of Organisational response Potential customer issues
  106. 106. Service recovery paradox.
  107. 107. Successfully fixing a problem with a defective product may lead to higher consumer satisfaction than in the case where no problem occurred at all.
  108. 108. Problems…………. Majority of the customers don’t complain. Expensive to fix mistakes. Encourages service failure. Don’t necessity to think of the firm. No guarantee the customer will end up more satisfied.
  109. 109. Service recovery paradox in a chart- Plan • to disappointed customer So that • They can recover well Gain • Greater loyalty from them.