Week Ten - Weekly Questions-Customer Relationship Management & Business Intelligence

Week Ten - Weekly Questions

Customer Relationship Management & Business Intelligence

1. What is your understanding of CRM?
   Customer relationship management (CRM) – involves managing all aspects of a customer’s relationship with an organisation to increase customer loyalty and retention and an organisation's profitability. CRM helps companies make their interactions with customers seem friendlier through individualisation. Therefore I believe CRM is a broadly recognized strategy for managing and developing a company’s interactions with customers and sales prospects.

For further knowledge on CRM visit http://www.youtube.com/watch?v=n3LEnCyaa5I

2. Compare operational and analytical customer relationship management.

Operational CRM supports traditional transactional processing for day-to-day front-office operations or systems that deal directly with the customers while Analytical CRM supports back-office operations and strategic analysis and includes all systems that do not deal directly with the customers. Therefore the primary difference between operational and analytical CRM is the direct interaction between the organisation and its customers.

3. Describe and differentiate the CRM technologies used by marketing departments and sales departments

CRM metrics include: sales metrics, service metrics, marketing metrics

Marketing Metrics include: number of marketing campaigns, new customer retention rates, number of responses by marketing campaign, number of purchases by marketing campaign, revenue generated by marketing campaign, and customer retention rate. While, Sales Metrics include: number of prospective customers, number of new customers, number of retained customers, number of open leads, number of sales calls, amount of new revenue, amount of recurring revenue, and number of proposals given.

4. How could a sales department use operational CRM technologies?

The overall goals of CRM are to find, attract, and win new clients, nurture and retain those the company already has, entice former clients back into the fold, and reduce the costs of marketing and client service. When an implementation is effective, people, processes, and technology work in synergy to increase profitability, and reduce operational costs therefore increasing the companies success. The sales force automation (SFA) system provides an array of capabilities to streamline all phases of the sales process, minimizing the time that sales representatives need to spend on manual data entry and administration. This allows them to successfully pursue more clients in a shorter amount of time than would otherwise be possible. Also, SFA also consists of a contact management system for tracking and recording every stage in the sales process for each prospective client, from initial contact to final disposition. Many SFA applications also include insights into opportunities, territories, sales forecasts and workflow automation, quote generation, and product knowledge.

5. Describe business intelligence and its value to businesses

Business intelligence (BI) refers applications and technologies used to gather, provide access to, and analyse data and information to support decision-making efforts. BI is valuable to the business as it can tell them things like:

—Determine who are the best and worst customers thereby gaining insight into where it needs to concentrate more for its future sales.

—Identify exceptional sales people.

—Determine whether or not campaigns have been successful.

—Determine in which activity they are making or losing money

6. Explain the problem associated with business intelligence. Describe the solution to this business problem

Companies can have a lot of data, however they are not able to benefit from levering this information and turning it into useful data for analytical and strategic decision making. The issue most organisations are facing today is that it is next to impossible to understand their own strengths and weaknesses, let alone their enemies, because the enormous amount of organisational data is inaccessible to all but the IT department. The problem: data rich, information poor. The best solution to this is to shorten the latencies so that the time frame for opportunistic influences on customers, suppliers, and others is faster, more interactive, and better positioned.

7. What are two possible outcomes a company could get from using data mining?
   

Data mining is the application of statistical techniques to find patterns and relationships among data and to classify and predict. Data mining represents a convergence of disciplines. Data-mining techniques emerged from statistics and mathematics and from artificial intelligence and machine-learning fields in computer science. Common forms of data-mining analysis capabilities include: cluster analysis, association detection, and statistical analysis. Cluster analysis is a technique used to divide an information set into mutually exclusive groups such that the members of each group are as close together as possible to one another and the different groups are as far apart as possible. CRM systems depend on cluster analysis to segment customer information and identify behavioural traits. Association detection reveals the degree to which variables are related and the nature and frequency of these relationships in the information