Customer Relationship Management issues
Customer relationship management (CRM) is an initiative employed by business enterprises in order to establish an interaction between current and future customers. CRM has helped many corporate industries to strengthen their relationships with their customers hence, positively, influence the image of the business. In addition, employment of CRM by a company creates a strong customer base and thus the company’s returns are expected to increase as a result of increased demand by customers. Moreover, CRM can also be viewed as a strategic technique employed in order to achieve company’s goals and objectives. However, CRM is not only a strategy in the large corporate industries but also the small medium enterprises can still apply the same initiative in order to create a better understanding of customers and maintain a customer base. On the other hand, many enterprises have failed to acknowledge the advantages of CRM implementation in an organization and have thus not been able, successfully, to implement.
Therefore, in the current economic situation, enterprises need to value the essence of CRM with the magnitude it deserves. Additionally, enterprises need to acknowledge the importance of relationships in the business network and corresponding benefit to the enterprise in general. An enterprise should thus be in a close range with its customers, investors and other enterprises. In practice, enterprises usually depend on each for raw materials and other intermediate products in order to complete their production processes. On the other hand, a good relationship with investors will boost the company’s reputation and thus bring in more investors and in turn significantly affect the profitability and performance of a company. Therefore, implementation of CRM in any business enterprise will have a significant impact on an enterprise future income flow. There are various important issues which need to be discussed under CRM which affect the effectiveness of its implementation. In addition, enterprises should, effectively, be able to understand and implement such strategies in to get the predetermined goals and objectives of the business enterprise. On the other hand, enterprises should understand that CRM is an evolving initiative and thus not a matter of utilization of technology.
Therefore, it is important to understand how CRM will, effectively, evolve from the current economic situation in order to help enterprises improve their relationship in the future. Additionally, enterprises should be quick to spot any business opportunity, make good utilization of the opportunity and through good interaction skills manage to acquire competitiveness in the industry. However, most of the enterprises are normally not up to the establishment of a strong customer base rather using information technology only in marketing their products. Therefore, great emphasis should be placed on how business should focus on establishing a relationship for the future prospects of the enterprise. Moreover, enterprises need to acknowledge globally environmental working factors and establish ways in which they can be addressed in order to remain competitive in the industry. The growth of many corporate industries globally and the increased competition in production industries, business enterprises need to change their relationship management skills and tactics in order to develop a competitive customer relationship against other rival industries.
Therefore, business enterprises should address the establishment of a strong customer base rather than just aiming at short run returns from marketing strategies. In addition, CRM will help deliver market value and hence guide the enterprises in changing their strategies with the ever dynamic market environment. Additionally, CRM will focus on the business skills, technology and techniques which will enable the enterprise to develop a strong and profitable relationship between customers. Therefore, an enterprise with great entrepreneurial skills will be competitive in the market industry with high sales and returns. Additionally, an enterprise should be dynamic in its strategic skills in order to attract customers and gain their confidence in the future. Further, an enterprise should closely keep track of its rival industries’ CRM practices in order to find out its weakness; hence evaluate its business techniques and skills. Therefore, CRM demands a lot of strategic and business skills for its success. Moreover, a corporate company with strong customer base can be associated with excellent business skills.
Additionally, rapid response to change in technology is required to enable the company stay updated with the current management practices and advertisement procedures of its products. Moreover, a clear channel of communication is necessary for an enterprise so as to allow customers to acquire all the information about the company. Therefore, for a successful implementation of CRM it requires a thorough evaluation of business practices and emerging technologies. However, most of the corporate companies have not yet developed their technology and business techniques which are the prerequisites for the success of CRM. Additionally, the scope of CRM is widely expanding and thus requires the application and implementation of technology and techniques from diverse areas and disciplines like human resource, e-commerce, e-business, accounting and knowledge management.
Therefore, it is of great importance for a company to revise its business skills, techniques and technology in order to establish a good relationship with customers. In so doing, the enterprise will gain customers’ confidence. On the other hand, a company needs to focus on employee behavior and changes in the organization. It is worth noting that people are the most crucial aspect in the establishment and maintenance of good CRM. On contrary to factors such as technology and pricing, human resource forms the initial stage of establishing contacts and relation not only to the customers but also to the stakeholders. Therefore, an enterprise should be able to embrace different cultural aspects, be flexible and radical in accepting changes as they happen. Moreover, an enterprise must be creative, innovative and agile in respect to the customer demands and expectations. Therefore, for a successful implementation of CRM, an enterprise should undertake their operations in aligning with the customer demands. Essentially, the customers will determine the success of the business in the future hence their needs must be put into consideration.
Additionally, some of the business practices in labor employment and management usually have a great impact on the CRM. Therefore, a company should try to maintain free and fair employment techniques in order to preserve its reputation in the market and hence strengthen customer base. Effectiveness in the management to have fair treatment of labor, incentive schemes for the employees is some of the factors which attract customer interests in a company. Additionally, a company should instill labor recruitment programs which are based on competencies and the preferred skills. Therefore, it is important to have fair treatment of labor and provide the necessary incentives not only to promote a company’s production but also to ensure better Customer Relation Management.
The investment decision of a company is another determinant of how the relationship between customers and the business enterprise will be. Therefore, it is preferred that a company chooses the investment decision in an appropriate manner since it ultimately affects the CRM. On the other hand, a company should ensure it selects projects which are productive and hence shareholders get some of the returns in the form of dividends. Additionally, investment decisions are as well of equal importance to customers. A good customer relation management can be attributed to the decisions a company undertakes concerning investments of the firm. In practice, a company may undertake various investment projects so that the value of the firm can be maintained. Therefore, if a firm makes investment decisions which adversely affect the value of the firm, customers will be worried about future uncertainty of such company.
Generally, company’s value will be determined by the type of investments a company undertakes which in turn affect the profitability and efficiency of the firm. Therefore, it is crucial for any enterprise to focus on the type of investment decisions taken since they talk much about the company. Additionally, company’s performance is important for the customer since it determines whether the company will go down or maintain its performance and efficiency. Therefore, in order to maintain a good customer relation management, a company’s performance must act as a convincing factor for the customers. Moreover, in publicly traded companies, financial statements are usually published for all the interested parties. Therefore, all the company’s activities will be reflected in the financial statements hence provide a clear view of the company’s future performance. Publicly published financial statements will thus act as the basis for customers to judge the enterprises’ performance.
Company sales are very important in determining the customer organization relationship. Therefore, an enterprise should be very keen in selecting sales practices in order to have a wide coverage of customers. Additionally, an enterprise's ability to acquire customers and retain them is correlated with profitability. Moreover, maintenance of high quality products and services is of great importance in gaining customers’ confidence and acquiring more customers. Therefore, sales of a company together with how the products are packaged are very much important for the company since it influences the amount of sales. Additionally, reaching out to customers helps to improve the company’s reputation across a wide range, thus an enterprise should try to use all means possible to advertise its product varieties.
On the other hand, in production of goods and services, an enterprise should first find out what customers need. In this perspective, an enterprise will produce goods and services in line with the customers’ demand. In so doing, the enterprise will minimize the costs incurred in producing most of the inventories which stay idle and thus the cost of production is cut down. Additionally, an enterprise reaching out to its customers for inquiry about the products it should produce will have a better relationship with its customers hence influence its profitability. Generally, customers’ tastes and preferences are important factors in determining the amount of goods a company is going to sale and hence prospect on the future earnings through a maintained relationship with the customer. Therefore, it is important for a company to formulate and implement sales and marketing practices which favor customers’ demand and preferences. In practice, by producing what the customer needs and at considerable market prices, an enterprise will secure a competitive place in the market.
A company should also review on its pricing policies in order to establish a strong customer base. Prices are very important to customers and will thus determine whether a customer buys a particular product or does not. Therefore, it is important for an enterprise to adopt a flexible pricing mechanism which will not adversely affect customers’ ability to buy goods and services. On the other hand, demand and supply of goods and services will equally determine their prices under a competitive market structure. Therefore, when demand is high, prices are anticipated to go up; while when the supply increases, prices will go down. Moreover, an enterprise should have price strategies which are customer friendly and fix prices which will end up exploiting the customers. Additionally, implementation of CRM software systems in an organization has helped to maintain a good contact with the customer. Basically, the company will have information about various products sold in different areas. Therefore, it will be easier to identify customers in different regions thus help the organization in embarking on measures to improve its sales in such regions. Moreover, with the evolution of CRM systems, more companies have begun to see the importance of the software systems thus expand their customer base which in turn affects the company’s performance.
Therefore, organizations should view implementation of CRM system more than just information technology; however, it is because of the information technology that CRM exists. Moreover, enterprises must acknowledge the usefulness of CRM system in the business and thus enable them to catch up with the developments in the global markets. Generally, customer relation management must be viewed as more of a technology rather than a process. In addition, CRM should be taken as more than just a software application which purposely aimed at managing the interactions between an organization and customers. Therefore, the usage of CRM is a development in producer-supplier interaction which is a more advanced and productive system. However, the system comes with a lot of challenges in the implementation process.
Therefore, successful implementation of CRM requires proper definitions of the targeted objectives and goals. It is important for an organization to come up with the objectives of implementing a CRM system in an organization. On the other hand, it should be noted that the definition of the objectives is not only targeted for the suppliers only, but also for the business too. An organization should, clearly, stipulate how processes in the business will change and what parts of the business enterprise will be affected. An enterprise must then determine what sort of customers and partners they will work with in order to make the implementation a success. The process of defining the needed specification need not to be carried out by any specialized personnel or an Information Technology specialist; rather, a member of the senior management can perform the task. Therefore, in so doing the problem of poor and failure of proper definition of the requirements can be done with. Another focus of the CRM should be on the vendor pressure. It is of great importance to be in close contact with suppliers which therefore necessitates for the establishment of a good relationship. Additionally, an organization should clearly state its requirements in order to avoid any unnecessary pressure from the vendors.
An organization should be so calculative in implementation of the CRM system in the business. Implementation of CRM in a business enterprise envisages very many parts of the organization, it is for this reason that the enterprise should make the approximation of the costs which are to be incurred in running the system in the business. Some of the areas which have issues in the implementation of the system are: Integration with the rest of the system, either new or an existing system, cleansing of the database in order to ensure all the clients’ information is available and in the appropriate state. Costs associated with paying external trainers because, for instance the system became more complicated.
It is usually common with the Small and Medium Enterprises to face these unforeseen costs as a result of lack of experience in how to go about the CRM. However, the consultant can be sought from the expertise on how to carry out the implementation. Alternatively, a business enterprise can consult with other organizations which have applied the system before. Customer Relation Management has the ability and potential to improve an organizational performance and efficiency, if only it’s done in the right manner. However, all problems stated above and associated with CRM can be avoided. On the other hand, an organization needs to review its capabilities and resources before putting place CRM. Therefore, it simply needs some clear understanding of how CRM operates.
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