Relationship Management in banking sector and the need for Customer Relationship For example, many financial institutions keep track of customers' life. the banking sector and identify marketing activities that are affected by. CRM usage. Taking a sample of banks that utilise a CRM system, we found a. The sample for the research study is selected scientifically. Two sets of Customer Relationship Management in Service Industry. CRM is recognized as the.
The payoffs are in terms of increased customer base, cross- selling, sales force optimisation, efficient lead management and higher productivity. Core areas of transformation were business focus, organisation structure, business matrix, marketing focus and technology.
This brings the bank one step ahead in providing convenience and service through CRM. The system generates reports daily for top management and each of the branches have access to reports generated particularly for them.
Bank of Maharashtra has developed in-house software which generates and updates a variety of reports on detailed customer information and sends to branches. These reports are utilised for better customer understanding, better customer support and service by access to relevant customer information with all stakeholders to enable decision making and Business Development as well as retention activities.
Issues and challenges CRM is a strategic initiative which has organisation wide implication. Many banks are still struggling to make proper use of this very useful mechanism.
However, the adoption and utilisation is dependent on a number of factors and impediments. Broadly the issues are pertaining to: People, Processes, Data and Technology.
Also a major drawback is the general perception of CRM being a Technology imperative.
There is a great need to understand that technology is only the enabler to CRM. In the real sense it is an organisation wide strategy. Most officers perceive technology as a limited to record of information and transaction.
The use of technology in further sophisticated information processing and dissemination is not done. There are multiple channels and multiple technologies in use simultaneously in customer interface, service and sales.
Empowerment to frontline staff: Frontline staffs have customer profile and data.
CUSTOMER RELATIONSHIP MANAGEMENT MODEL FOR BANKS | Open Access Journals
Most of them have no motivation to further process these and make full utilisation of these to provide better services and proactive selling effort.
They are neither trained to use customer analytics nor to customise the Banks offering. Historical data collected from legacy systems tend not to have been collected in any standard form. This process has to be carried out across branches which in addition to their core tasks have this work. Employees expected to organise and systematically manage data may not dot efficiently because of the lack of understanding of the strategic perspective of this activity.
Customer Relationship Management in Banking Sector
They also lack the necessary infrastructure and skill to complete this task. People issues Lack of knowledge and skills in converting data to customer knowledge Lack of motivation for utilising the potential of CRM solution Inadequate performance management parameters Less or insufficient decision making authority: In order to use CRM concept towards customer centricity, sufficient decision making power is required to provide customised, responsive and proactive services.
Staff lacks training in IT, its applications, the complete use of software and its applications as well as marketing skills, analytical skills, uses of customer information and service skills for implementation CRM.
Process issues As CRM is an organisation wide strategy the entire processes need to be aligned appropriately. Some important process issues are: This encompasses a fundamental change in the organisational practices and employee behaviour.
CRM cannot succeed in Silo structure of departments. It demands integration and collaboration of all departments on a continuous basis. So, Breaking of silos prevalent in traditional organisation structure is a challenge.
Change in Structure and Systems: CRM success lies in ownership of CRM by all departments with Marketing in the strategic role of combining efforts in all these towards better customer service. This basic structural change from product centric organisation to customer centric organisation faces impediments in terms of role conflicts, ambiguity, resistance and attitudinal impediments. Demand for more pro-activeness and flexibility: The former strict hierarchical and rigid structure has to be transformed to flexible, responsive and proactive structure.
This demands top management support, proper training and efficient follow up systems. In addition to behavioural issues the full utilisation of CRM benefits cannot be attained unless this is enabled.
Banks have made a large investment in technology and benefits thereof are being realised in terms of improved customer empowerment, customer orientation and convenience.
Yet to realise the full potential, a need to emphasise the strategic importance of CRM is felt. The following section suggests a strategic framework to enable successful CRM implementation. So far the commission surplus could not absorb this decline. Channels of Customer Contacts According to this evolution new distribution channels become more important.
The key word is Multi-Channel-Distribution. For instance the internet allows the banks to reach a bigger customer group with lower deployment by using Multi-Channel-Distribution. This concept helps to offer custom-tailored products by the suitable distribution channel. As the figure 1 shows the banks use multitude of different channels of customer contacts.
Customer Relationship Management in Banking Sector |authorSTREAM
The traditional customer contact is still the counter Point of Purchaseat which all businesses can be transacted. Such customer contacts could also take place by home visits Direct Sales. The loosing of the direct contact was introduced by telephone banking, which gives the customers the possibility to transact the business via Call Centre or via Electronic Mail at home. All these caused the structural changes at the bank market. Current information technologies like internet, multimedia, networking or digitalization afford new forms of corporation between vendor and customer.
That creates new distribution outlets. On the other site the customer can use other und especially cheaper information channels and distribution channels, for instance direct banking via World Wide Web. Conventional and high-cost distribution structures force the banks to re-engineer their marketing policy.
Therefore many banks use systems and concepts to improve and to handle the costumer contacts.Examples of Customer Relationship Management
In the following of this paper the Customer Relationship Management will be showed and analyzed. CRM is not just a single application that will solve all customer related problems in an organization. These areas are sales, marketing and customer service.
Therefore you can define CRM as follows: CRM requires a customer-centric business philosophy and culture to support effective marketing, sales and service processes. This means to identify the most valuable customers and to provide these with the best possible service.