Chapter
8
Section
1
What
is
CRM?
Managing
the
full
range
of
the
customer
relationship
involves
two
related
objectives:
one,
to
provide
the
organization
and
all
of
its
customer-facing
employees
with
a
single,
complete
view
of
every
customer
at
every
touchpoint
and
across
all
channels;
and,
two,
to
provide
the
customer
with
a
single,
complete
view
of
the
company
and
its
extended
channels.
Companies
are
turning
to
Customer
relationship
management
to
improve
their
customer
focus.
CRM
uses:
(1)
information
technology
to
create
a
cross
-‐functional
enterprise
system
(2)
IT
framework
of
Web-‐enabled
software
and
databases.
How
does
CRM
help?
~/the
major
application
compononet
/
Contact
and
CRM
software
helps
sales,
marketing,
and
service
professionals
Account
capture
and
track
relevant
data
about
every
past
and
planned
management
contact
with
prospects
and
customers,
as
well
as
other
business
and
life
cycle
events
of
customers.
Information
is
captured
from
all
customer
touch
points,
such
as
telephone,
fax,
e-‐mail,
the
company’s
website,
retailstores,
kiosk
and
personal
contact.
CRM
systems
store
the
data
in
a
common
customer
database
that
integrates
all
customer
account
information
and
makes
it
available
throughout
the
company
via
internet.
Or
other
network
link.
Sales
CRM
system
provides
sales
reps
with
the
software
tools
and
company
data
sources
they
need
to
support
and
manage
their
sales
activities,
and
optimize
cross-‐selling
and
up-‐selling.
Marketing
and
CRM
software
helps
marketing
professionals
capture
and
manage
Fulfillment
prospect
and
customer
response
data
in
the
CRM
database,
and
analyze
the
customer
and
business
value
of
a
company’s
direct
marketing
campaigns.
Customer
CRM
system
provides
service
reps
with
software
tools
and
real-‐
Service
and
time
access
to
the
common
customer
database
shared
by
sales
support
and
marketing
professionals.
Call
center
software
routes
calls
to
customer
support
agents
based
on
their
skills
and
authority
to
handle
specific
kinds
of
service
requests.
Help
desk
software
helps
customer
service
reps
assist
customers
who
are
having
problems
with
a
product
or
service
by
providing
relevant
service
data.
Web-based
self-service
enables
customers
to
access
personalized
support
information
easily
at
the
company
website.
Retention
and
Enhancing
and
optimizing
customer
retention
and
loyalty
is
a
Loyalty
major
business
strategy
and
primary
objective
of
CRM.
Programs
CRM
helps
a
company
to
identify,
reward,
and
market
to
their
most
loyal
and
profitable
customers.
What’s
the
three
phases
of
CRM?
(1)
Acquire
–CRM
software
tools
and
databases
to
help
company
acquire
new
customers
by
doing
a
superior
job
of
contact
management,
sales
prospecting,
selling
direct
marketing
and
fulfillment.
Let
customer
perceive
the
value
of
offered
products.
(2)
Enhance
–
Web
Enabled
CRM
account
management
and
customer
service
and
support
tools
help
keep
customers
happy
by
supporting
superior
service
from
a
responsive
networked
team
of
sales
and
service
specialist
and
business
partners.
(3)
Retain
–
CRM
analytical
software
and
databases
help
a
company
proactively
identify
and
reward
its
most
loyal
and
profitable
customers
to
retain
and
expand
their
business
via
targeted
marketing
and
relationship
marketing
programs.
What’s
the
Benefit
and
Challenges
of
CRM?
-‐
Allows
business
to
identify
and
target
its
best
customers
-‐
It
makes
possible
real-‐time
customization
and
personalization
of
products
and
services
based
on
customer’s
want,
need,
and
buying
habit,
life-‐cycle
-‐
It
help
to
keep
track
of
when
customer
contact
the
company
-‐
It
enables
a
company
to
provide
consistent
customer
experience
and
superior
service
and
support
across
all
the
contact
points
a
customer
chooses.
What
causes
the
CRM
to
fail
/failure/?
-‐ Lack
of
understanding
and
preparing
-‐ Rely
on
major
new
application
of
information
technology
like
CRM
to
solve
business
problem
without
first
developing
the
business
process
changes
and
change
manage
management
programs
that
are
required.
-‐ Lack
of
stakeholder
participation.
/employees
and
customers
are
not
prepared
for
it
/
Section
2
What
is
ERP?
ERP
is
the
technological
backbone
of
e-business,
an
enterprisewide
transaction
framework
with
links
into
sales
order
processing,
inventory
management
and
control,
production
and
distribution
planning,
and
finance.
ERP
-‐ is
a
cross
functional
enterprise
system
driven
by
an
integrated
suite
of
software
modules
that
supports
the
basic
internal
business
processes
of
a
company.
/for
example:
ERP
software
for
a
manufacturing
company
will
typically
process
the
data
from
and
track
the
status
of
sales,
inventory,
shipping,
and
invoicing
as
well
as
forecast
raw
material
and
human
resource
requirement/
-‐ gives
a
company
an
integrated
real-‐time
view
of
its
core
business
/production,
order
processing,
and
inventory
management/
-‐ track
business
processes
/cash,
raw
materials,
and
production
capacity/
-‐ software
suites
typically
consist
of
integrated
modules
of
manufacturing,
distribution,
sales,
accounting,
and
human
resource
application.
What’s
the
Benefit
and
Challenges
of
ERP?
-‐ Quality
and
Efficiency:
ERP
creates
a
framework
for
integrating
and
improving
a
company’s
internal
business
processes
that
results
in
significant
improvements
in
the
quality
and
efficiency
of
customer
service,
production,
and
distribution
-‐ Decreased
cost:
Many
companies
report
significant
reductions
in
transaction
processing
costs,
hardware,
and
software
-‐ Decision
support:
ERP
provides
vital
cross-‐functional
information
on
business
performance
to
managers
quickly
to
significantly
improve
their
ability
to
make
better
decisions.
-‐ Enterprise
agility:
Implementing
ERP
system
breaks
down
many
former
departmental
and
functional
walls
or
“silos”
of
business
processes,
information
systems,
and
information
resources.
This
result
in
more
flexible
organization
structures,
and
work
roles,
and
therefore
a
more
agile
and
adaptive
organization
and
workforce
that
can
more
easily
capitalize
on
new
business
opportunities.
What
causes
ERP
to
fail?
-‐ To
underestimate
the
complexity
of
the
planning,
development,
and
training
that
were
needed
to
prepare
for
the
new
ERP
system.
-‐ Failure
to
involve
affected
employees
in
the
planning
and
development
phases
and
to
change
management
programs
-‐ Trying
to
do
too
much
too
fast
in
the
conversion
process
-‐ Overreliance
by
company
or
IT
management
on
the
claims
of
ERP
software
vendors
Section
3
What
is
SCM?
Supply
chain
management
is
a
cross
functional
interenterprise
system
that
integrates
and
automates
the
network
of
business
processes
and
relationships
between
a
company
and
its
suppliers,
customers,
distributors,
and
other
business
partners.
What’s
the
goal
of
SCM?
To
create
a
fast,
efficient,
and
low-‐cost
network
of
business
relationships,
or
supply
chain,
to
get
a
company’s
products
from
concept
to
market.
The
objective
is
significantly
reduce
costs,
increase
efficiency,
and
improve
their
supply
chain
cycle
times.
SCM
software
can
also
help
to
improve
interenterprise
coordination
among
supply
chain
process
players.
What’s
Electronic
Data
Interchange?
-‐EDI
involves
the
electronic
exchange
of
business
transaction
documents
over
the
internet
and
other
networks
between
supply
chain
trading
partners.
-‐EDI
software
is
used
to
convert
a
company’s
own
document
formats
into
standardized
EDI
formats
as
specified
by
various
industry
and
international
protocols.
-‐EDI
is
an
example
of
the
almost
complete
automation
of
an
e-‐commerce
supply
chain
process.
-‐EDI
is
still
popular
data-‐transmission
format
among
major
trading
partners,
primarily
to
automate
repetitive
transactions.
-‐EDI
automatically
tracks
inventory
changes;
triggers
orders,
invoices
and
other
documents
related
to
transactions.
What’s
the
role
of
SCM?
What’s
the
Benefit
and
Challenges
of
SCM?
(1) Benefit
-‐ Effective
supply
chain
management
system
-‐ Faster,
more
accurate
order
processing;
reduction
in
inventory
level;
quicker
times
to
market,
lower
transaction
and
material
costs;
and
strategic
relationships
with
their
suppliers.
(2) Challenges
-‐ A
lack
of
proper
demand
planning
knowledge,
tools
and
guideline
-‐ Inaccurate
or
overoptimistic
demand
forecasts
-‐ Inaccurate
production,
inventory,
and
other
business
data
-‐ Lack
of
adequate
collaboration
among
marketing,
production,
and
inventory
management
departments