Customer Relationship Management

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Customer Relationship Management

• Professor William Qualls
• University of Illinois

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Balanced Scorecard

• The concept originated with 12
• companies in a study group lead by
• Robert Kaplan of Harvard University
• Used by a majority fortune 500,
• Government, non-profit enterprises
• Focuses on outcomes/results -not activities
• Looks at five performance areas rather than a
• single, traditional bottom line

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5 primary areas of performance focus ...

• Customer Management Perspective - To achieve our
  vision, how must we look to our customers
  constituents?
• Internal Operations Perspective - To satisfy our
  customers, what management processes must we
  excel at?
• Organizational Learning and Innovation
  Perspective - To achieve our vision, how must
  our university learn and improve?
• Financial Management Perspective - If we
  succeed, how will we look to our constituents?
• Employee Empowerment Management - How will we
  reward performance and provide for learning?

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Benefits of A BALANCED SCORECARD

• Clarifies a firms Vision
• Provides balanced assessment accountability at
  all levels
• Creates alignment of strategic operating
  priorities with results
• Supplies strategic feedback key learnings
• Links rewards to performance outcomes
• Accelerates organizational change

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Customer Relationship Management (CRM)

• CRM is a business strategy that an organization
  performs to identify, select, acquire, develop,
  retain, and better serve customers
• A CRM strategy attempts to optimize a firms
  profitability, revenue and customer satisfaction
  by focusing on a customer centric process.

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EVOLUTION OF CRM

• 1980S
• Focus on Data Mining and Direct Marketing was the
  outcome

• 1990S
• Focus on loyalty programs

2000S
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GOALS OF CRM

• Provide better customer service
• Cross sell products more effectively
• Helps sales staff
• Simplify marketing and sales processes
• Discover new customers and new customer needs
• Increase customer revenue

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CRM AND SRM
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CRM and Analytics

• 2. Whats Missing?
• Who, what, why
• Robust qualitative Hearing the Consumer/Client
  Voice
• Primary research customized to clients real
  marketing and sales need
• True 360 degree analytic view of client
• General lack of understanding of clients
  business and negligible insight delivery
• No way to do standard market driver protocols
  tests, market measurement, satisfaction loyalty
  assessment
• No guidance on what to do with all the data

• 1. Typically, CRM Analytics are
• Automated alerts
• Automated scripts to assist Customer Service or
  Sales
• Automated data mining templates, very
  restrictive and inflexible

• 3. This leads to three areas of need
• Deliver full faceted analytics
• Enrich customer understanding
• Optimize CRM strategy and customer
  intelligence (data, customer understanding, and
  marketing driven solutions)

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Full-Faceted CRM Analytics Are Needed
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Understanding of Customer Needs to be Enriched
Behavior Transaction, Scanner CRM
Clickstream Data
Attitudes Perceptual Attitudinal Quali/quant Data

Demographics and Third Party Data
Data Stream

• SEGMENTING
• Cross Tables
• Cluster Analysis
• Correspondence Analy.
• Principal Components
• CART

• PREDICTING
• Regression
• Neural Networks
• Genetic Algorithms
• CART
• Bayesian Choice

• TESTING/MODELING
• Chi Square
• T-Tests/ANOVA
• Structural Modeling
• Data Modeling

Marketing Strategies, Responses, and Actions
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CRM Strategy Has to be in Place and Optimized for
Effectiveness
Determine Business Drivers
Assess Customer Value
Develop, Test Deploy CRM Value Propositions
Measure, Analyze Refine CRM Processes
Quali/Quant Research
Test Levers Evaluate Models Measure
Effectiveness Refine Solutions
Market Analysis Secondary Research Competitive
Intelligence Segment/Profile
CRM Analytics Behavioral Attitudinal
Data ROI Customer Loyalty Customer Satisfaction
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