CH11 - CRM and SCM Flashcards
What’s the concept of Customer Relationship Management (CRM)?
- it is a customer-centric way of thinking and acting.
- It’s a customer-focused and customer-driven organizational strategy.
- Organizations concentrate on assessing customers’ requirements for products and services and then provide a high-quality, responsive customer experience.
Characteristics of CRM
- Enabled by IT in the form of various systems and applications
- CRM is not only about the software
- Problem with managing relationships: time and informations
- Modern CRM strategies: sustainable long-term customer relationships that create value for the company as well as for the customer.
2 elements (Policies) a company needs to use CRM?
- Company must identify the many types of customer touch points
- Company needs to consolidate the data with each customer
What’s a CRM process/strategy?
A process where a company treats different customers differently because their needs differ and their value to the company may also differ.
A successful CRM strategy not only improves customer satisfaction but also makes the company’s sales and service employees more productive, which in turn generates increased profits.
What’s a Customer Churn?
all organizations inevitably lose a certain percentage of customers during a certain time frame
→ The optimal result of the organization’s CRM efforts is to maximize the number of high-value repeat customers while minimizing customer churn.
What are CRM systems?
Basically, CRM systems are information systems designed to support an organization’s CRM strategy.
CRM systems lie along a continuum, from low-end CRM systems—* designed for enterprises with many small customers—to *high-end CRM systems—for enterprises with a few large customers.
What are the 2 types of CRM systems?
- Low-end → designed for enterprises with many small customers
- High-end → For enterprises with a few large customers
What is a customer touch point?
- Any point of interaction between a customer and an organization
What are the Customer Touch Points?
Traditional customer touch points: telephone contact, direct mailings, and actual physical interactions with customers during their visits to a store.
Other additional customer touch points: email, websites, and communications through smartphones
Omni-channel marketing: effective marketing makes use of all of these channels (touch points) in sync with one another
What’s data consolidation?
- Modern interconnected systems built around a data warehouse now make all customer-related data available to every unit of the business.
- This complete data set on each customer is called a 360° view of that customer.
- A 360° view enhances company’s relationship with its customers and ultimately make more productive and profitable decisions.
→ Customers information is very data heavy, must use data warehouses**
What’s collaborative CRM?
- Info. sharing leads to collaborative CRM.
- provide effective and efficient interactive communication with the customer throughout the entire organization.
- integrate communications between the organization and its customers in all aspects of marketing, sales, and customer support
What are Operational CRM systems? (Important)
Supports front-office business processes.
What are front-office business processes?
those that directly interact with customers; that is, sales, marketing, and services.
What are the types of operational CRM systems?
- customer-facing applications
- customer-touching applications
What the definition of a customer-facing application?
An organization’s sales, field service, and customer interaction centre representatives interact directly with customers
What are examples of customer-facing applications?
- Customer Services and Support
- Sales Force automation (the component of an operational CRM system that automatically records all of the components in a sales transaction process)
- Marketing
- Campaign Management
What is the definition of customer-touching application?
Customers who use these technologies interact directly with the applications themselves.
What are examples of customer-touching applications?
- Search and Comparison Capabilities
- Technical and Other Information and Services
- Customized Products and Services
- Personalized Web Pages
- FAQs
- Email and Automated Response
- Loyalty Programs
What is the relationship between Operational and Analytical CRM? (Important)
Whereas operational CRM systems support front-office business processes, analytical CRM systems provide business intelligence by analyzing customer behaviour and perceptions.
These systems also create statistical models of customer behaviour and the value of customer relationships over time, as well as forecasts about acquiring, retaining, and losing customers
What is part of the supply chain structure?
- Upstream
- Downstream
- Internal
- Reverse flows
What are the 5 basic components of supply chain management (SCM)?
Plan: Planning is the strategic component of SCM. Organizations must have a strategy for managing all the resources that are involved in meeting customer demand for their product or service.
involves developing a set of metrics (measurable deliverables) to monitor the organization’s supply chain to ensureefficiency, high quality and value to customers for the lowest cost.
Source: In the sourcing component, organizations choose suppliers to deliver the goods and services they need to create their product. Supply chain managers: develop pricing, delivery, and payment processes with supplierscreate metrics to monitor and improve their relationships with their suppliersdevelop processes for managing their goods and services inventory, including receiving and verifying shipments, transferring the shipped materials to manufacturing facilities, and authorizing supplier payments.
Make: This is the manufacturing component. Supply chain managers schedule the activities necessary for production, testing, packaging, and preparation for delivery.
This component is the most metric-intensive part of the supply chain, in which organizations measure quality levels, production output, and worker productivity.
Deliver: This component is often referred to as logistics. Organizations coordinate the receipt of customer orders, develop a network of warehouses, select carriers to transport their products to their customers, and create an invoicing system to receive payments.
Return: Supply chain managers must create a responsive and flexible network for receiving defective, returned, or excess products back from their customers, as well as for supporting customers who have problems with delivered products.
What’s the bullwhip effect? (IMPORTANT + GRAPHS)
- erratic shifts in orders up and down the supply chain
- variables that affect customer demand can become magnified when they are viewed through the eyes of managers at each link in the supply chain.
- When self-interest placed above that of the chain!
- Hoarding
- Stockpiling
