CHAPTER - 1

INTRODUCTION AND
DESIGN OF THE STUDY
 CHAPTER-1

INTRODUCTION AND DESIGN OF THE STUDY

1.1 INTRODUCTION

Customer relationship management is essential because, in the end if there are

no customer, no'business and no future.

Good customer relationship is at the heart of business success stronger

relationship between the Banker and the customer, more likely the customer will give

more deposits to the bank. Now, banking is shifting from trying to maximize the profit

on each individual transaction to maximize beneficial relationship. The operating

principle is build good relationship and profitable transaction will follow automatically.

Now-a-days the CRM is fast moving and highly competitive market and

product development and important development of one to one customer relationship.

CRM is implemented to see future and to create the loyal customers. CRM is guide to

people, process and technology development to the future. Customers want a personal

relationship with the company and the banking. By reducing the cost of services, and

customer care. CRM analyses the intelligent and initiative and enable customers, to

measure revenues, profits and customer satisfaction. CRM technologies can be made

effective by sales, marketing and services. CRM raters to organizing your bank around

the needs of your most valuable and profitable customers in the marketing community

and around business strategy of any bank to follow. CR.M represent a new way of doing

business—fof-blnkS,—Stiaras the sales culture, one - to - one marketing, data

warehousing, data-mining, customer, customer segmentation loyalty programs and

cross selling.
 CRM has become a "customer-centric" business strategy information to

discover the customers financial reeds and engages all the business of the banks in

satisfying the needs.

The aim of CRM is to build long-term mutually satisfying relations with

customer in order to earn and retain business by delivering high quality products and

services at reasonable prices over the time. In other words, instead of trying to

maximize profits from each and every transaction, CRM focuses on maximizing profits

over the lifetime value of the customer by creating and maintaining relationships. Long

standing, happy customers can be served with less customers services, marketing and

sales costs.

1.2 HISTORICAL PERSPECTIVE OF THE STUDY:

Only in 1983, Berry formally introduced the term Customers Relationship

Management to the literature though several ideas at relationship marketing and

emerged much earlier.

In 1996 Prentice Hall published Dr.Jon Anton's entitled Customer Relationship

Management. First book a new business revolution, and a completely new industry of

vendors providing CRM solutions to company's worldwide

Over the past 5 years, thousands of companies have been the corporate journey

to become more "customer-centric" by adding CRM solutions to their internal

infrastructure there by hoping to get better connected to their customers.. During_these —

past 5 years. We have learned a great deals about what CRM is, and what it is not.

At present, companies are designing strategies to retain customers and build

long-term relationship with them through CRM..

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 CRM is a relative new corner that appeared in the business radar. With the

advent of e-commerce. CRM has become a typical area of interest. It is a business

strategy with technology as its nucleus. The successful implement ion of CRM in the

organization requires re orientation of a company's culture-the way the company is

managed employees are trained and evaluated. The whole business organizations

should become consumer-centric.

1.2.1 Customer Understanding:

The important to the customer understanding. The customer relationship and before

the customer understanding. Understanding the customer's requirement and developing

suitable strategy in itself will provide competitive advantage to the supplier. It is

necessary to understand the customer requirement, priorities, likes and dislikes, buying

behaviour and factors that satisfying. In many cases customer requirement may be

different due to his liking or due to other factors.

1.2.2 Develop the Customer Understanding:

Some of the factors studies can help in forming an opinion about the customer

are listed below.

• History
• Culture
Habits
• Belief and factors affecting them
• Attitude
• Perception approach
-Analysis-of Past-
• Motivating factors
• Services

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1.2.3 Facets of CRM

CRM is a methodology to achieve the customer satisfaction It tracks customer's

history, needs, and co-ordinates banker's multi-programmed interaction with its

customer for business excellence. CRM reach every area of business

There are:

A Customer needs
A Customer response and influence
A Customer satisfaction
A Customer loyalty
A Reclaiming lost customer
A Customer complaint
A Customer service
Figure 1.1 Facets of CRM

Customer needs Customer loyalty

understanding

Customer response Customer response

flM and influence
and influence

Customer Customer service

satisfaction

Source: Secondary data - Customer Relationship Management - R.K. Sugandhi

1.24 Pre - Requisites of CRM

CRM_i_s relationship process through which a company can cultivate

relationship on long - term basis with its customer groups segments in such a way that

it would benefit both the customer and the company. The pre - requisites of CRM

programmes are.

-4 Willingness on the part of the company and the customer to stay committed to
the relationship, which is based on mutual benefits.
-4 A 'non — transaction' orientation on the part of the company is required.
Contary to a transaction - one off interaction - CRM is concerned with
formulating and implementing strategies to build long — term relationships -1
with customers.
Willingness on the part of the company to invest in an infrastructure that can
implement and operationalise CRM. The infrastructure could include web -
based hardware / software that can effectively harness the advantages of CRM.

Now - a - day Customer Relationship is involved all the field and improvement

the customer understanding the growth and developing sectors. CRM is basis the only

the customer to analysis the customer satisfaction, measure customer Relationship,

market research. Desk Research, field survey, customer response, customer retention,

complains management, service, consumer sectors, and e - CRM.

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1.2.5 Importance of CRM:

CRM helps the organization to identify customer needs and re -focus in strategy
to serve him better. It helps the company to achieve business growth through
development of competitive edge and excellence some of the major issues addresses
are:
• Identify customer needs
• Help in rediscovering the customer and understanding him
• Identify untapped business potential
• Identify fields requiring new technology and development
• Identify strong and weak points of supplier
• Provide feedback to the supplier on his total operation
• Provide feedback and new information on competitors
• Bench marking to achieve global excellence
• Action plan to make organization customer - centric.

CRM helps in providing uniqueness to the organization to help it build up

different ration from its competitors. This is achieved through.

Comprehensive approach tailored to meet customer's specific needs

• To build up customer focused operating environment and culture
• To prepare and implement result oriented action plan
• Continuous up gradation of competencies to provide enhanced benefits and
satisfaction to customer.

1.2.6 Implementing CRM

Implementing CRM is most important. This is not a simple matter. If you

attempt to implement a CRM package without knowing now implementions works, it is

likely that you will face problems throughout the _project and, you...could_be_in. for a fait-

and a big one at that it could even be a job termination.

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 Implementations on a larger scale are not covered here they are more complex

in scope and methodology. They have a different set of problems and often a larger

team.

1.2.7 CRM Implementation Steps

1. Pre -'implementation

The timeframe on this one various from several weeks to several months

according to the depth of preliminary work your company needs to do for example, in

this timeframe, the decision is made to go with e CRM implementation.

Your selection criteria must be sharp and you must have some reference to help

you identify the established customer and new customer. Some of the criteria for the

selection one :

• Scalability of software
• Toolset flexibility for customization
Stability of the existing CRM application with legacy systems and internet
systems.
)=. Level of technical support available during and often the implementation. A
• Upgrade support

2. The commencement meeting:

This meeting, which should take two or three days, is where the customer and

the partner decide which responsibilities are assigned to whom. The team members

meet each other and the chemistry for the implementation is established.

:—
-3;Project-ManagerIPMF:

The project manager is responsible for all aspects of the implementation on

including cost control, quality and testing, and customer satisfaction.

 Since the PM may be managing several projects simultaneously usually may

not be available at the required time. If there is a problem, the PM is the person to

consult and the one who is expected to work out the solution.

The project manager represents a consulting services partner or a systems

integration. If there are changes in the statement of work (SOW).

There should be a change management process in place that is approved by both

the customer and the implementation services company.

4. Implementation on Leader:

This person is also the technical leader. He is responsible for 'dedicated to only

the one project at a time. However, he does not resolves the problems of the project.

That is done by the project manager's team.

5. Project Manager :

The project manager owns the project from the customer's point of view. That

means the PM is in relationship with the partner's PM.

This project manager filters any suggested changes in the sow, prior to a

discussion with the partner PM on changes. This PM is also the one who approves the

pricing for the change. We should not do any changes free of cost

6. Administrating or networking staff :

People, who are maintaining

_ and _setting_up_ the network,_should. ensure-that
_
there is no significant downtimes or problems during the implementation period.

Actually, that have to do this all the time. Because a good deal of an implementation

process involves working the bugs out of it, the stress on the system can be great.

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7. integration professional :

This expert is an charge of integration of CRM with other information systems.

This person has to have specialized skills to interact with the other information

systems.

1.2.8 Successful Implementation of CRM

-+ Developing customer - centric process

- Selecting and implementing technology solution
-* Empowering employees
-+ Building customer information
- Developing the ability to Lear from and imbibe the best practices
-+ Knowledge generation capabilities to differentiate between customers.

1.2.9 The CRM Success Factors

The various success factors of CRM are

• Strong internal partnership around CRM strategy
• Employees at all levels and all areas accurately collect information
• CRM tools are customer - and - employee friendly
• Report out only the data you use and use the data report
• Do not go high - tech when low - tech will do

1.2.10 CRM Development Cycle

Business starts with customer. Hence, any successful CRM initiative is highly

dependent on a solid understanding of customers.

1.2.11 CRM Life Cycle

Understand and differentiate

2. Development
_ and customize
3. Interact and deliver
4. Acquire and retain
5. Prioritizing the changes
6. Creating an action plan
7. Measuring success

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1. Understand and differentiate:

True understanding is based on a combination of detailed analysis and action.

The important activities are:

• Profiling to understand demographics, purchase patterns and channel preference

• Segmentation to identifying logic unique group of customers that tend to look a
like and behave in a similar fashion
)=' Primary research to capture reeds and attitudes
• Customer valuation to understand profitability as well as life time value or long
term potential.

2.Development and customize:

Most organizations today are not able to cost effectively customize products for

individual customer. The extent at customization should be based on the potential value

delivered by the customer segments.

3. Interact and Deliver:

Interaction is also a critical component of a successfiil CRM initiative.

Customer's interaction is in many different areas of the organization, including

distribution and shipping, customer service and online.

• All areas of the organization have easy access to relevant information

• All areas are trained to use customer information to fail or interactions
based on customer needs.

Customer perceptions of value are based on a number of factors including the

quality of products and services, convenience, speed, case at the use and service

excellence.

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4. Acquire and retain:

The more organizations learn about customer, the easier it is to pinpoint those

that are producing to greates value for the organization And because they will continue

to learn about what is valuable to each segment, they will be more likely to score a win

with the right channel, the right media, the right product, right offer, right timing and

the most relevant message.

Successful customer retention is also based on the organisation's ability to

constantly deliver on 3 principles.

Maintain interaction. Never stop listening

Deliver on the customer's definition of value and

Remember that customers change as they move through differing life stage.

5. Prioritizing the changes:

The organization should evaluate each of the strategies identified to - resolve

gaps based on :

=> Cost - so as to implement including initial one time costs, as well as

anticipated ongoing expenses.

=> Overall benefit - some changes may have longer impacts on the

organizations ability to increase customer value and loyalty

=> Feasibility - based on organization need, data and systems support,

resource skill - sets and a number of other factors

=> required_including-the-time •necessaiy-for-training-addressing —

c;ultural change management issues related to specific

strategy .

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6. Creating on action plan:

While the complete plan might span three or more years. It should be based on

-
six — month phases with clear deliverables that will demonstrate both progress and

quick hits or measures of success.

7. Measuring success:

Implementing CRM happens to be time consuming and hence needs a

significant commitment across the organization and it is crucial that the action plan.

• Establish means of measuring the progress on CRM initiatives

• Establish enterprise wide measures of success and metrics that can be

applied to all of the CRM initiatives and

• Apply these metrics on an ongoing basis to ensure continued finding of

your CRM initiatives.

1.2.12 CRM Process Framework:

The broad framework suggests that CRM process comprises the following

forms of sub - processes :

a) Customer relationship formation process

b) Relationship management and governance process

c) Relational performance evaluation process ; and

d) CRM evolution (or) enhancement process

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0

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ManagementandGovernance

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1.3 OPERATIONAL DEFINITIONS:

According to kotler and Armstrong CRM involves managing detailed

information about individual customers and carefully managing touch points in order to

maximize customer loyality.

Later, CRM is viewed as the overall process of building and maintaing

profitable customer relationships by delivering superior customer value and

satisfaction.

The challenge according to Jeffrecy Gitomer is not to produce delighted and

loyal customers The shift in emphasis from transaction marketing -one time deal - to

relationship marketing is based on the premise that important accounts need to be

focused and attended aptly.

1.4. STATEMENT OF THE PROBLEM:

The important problem at the study is, the banking is large scale sectors banking

is the main part of the life. Many at the people do not understand the banking

functions, bank introducing the new scheme but do not reach the all the people, the

illiterate people and poor people do not reach the banking activities. The customer

relationship management is most important do rectifying the customer problems.

L5. SCOPE OF THE STUDY:

The scope of the study of CRM in SB1 is mention of below to understand the

concept of CRM in SRI.

been constructed to evaluate the present scenario of the customer

Relationship ingt in banking sectors
• This study would be helpful to know the customer satisfaction and rectify
the some problem.
• This study provide best remedies to the CRM in banking sectors.

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1.6 NEED OF THE STUDY:

. he important the Need of the study is listed below

• The study do analyses to the banking functions.
• Banking functions to reach the all the people.
• The CRM manager should appointment to the banking, and guide to the
people.
• To know the people all the banking sector functions
• The people proper utilize (or) use of the bank
• The banker what basis do attract the customer and what are the services
to the customers.
• Customer services is most important and what are new services to the
customers.

1.7 OBJECTIVES OF THE STUDY:

1 1I.
ToTo
To study
study
study the
the CRM
CRM
the Practices
Practices
performance ininSBI
of SBIbank
SBI inbank
Tiruchengode.
2 To study the relevance of customer relationship management in SBI banks
2 3ToTosuggest
examine thecustomers
benefits and implementation management
2. To study the opinion about the banking services.in SBI bank
and mean to maintain the CRM in SBI
4 To analyze the challenges faced by SBI bank in providing better facilities and
. 3. To study the customers opinion about CRM in SBI Tiruchengode.
maintaining
sod.3 good relation with their customers.
5
4. To suggest
ToAthe
3 To analyze the
CRMand inmean to maintain
faced by the
SBI Tiruchengode
challenges SBICRM
bankininSBI.
providing better facilities and
maintaining good relation with their customers
1.8 FIXING OF HYPOTHESIS:
4 To examine the benefits and implementation management in SBI bank
1. The CRM is SBI Tiruchengode is good.
5 To study the relevance of customer relationship management in SBI banks

1.9. METHODS OF STUDY:

Chromepet town has been selected for

The CRM of state bank of India at Tiruchengode

these study. This bank has been selected and the researcher used convenient sampling.

Random selected at the respondent has not been possible as there was no sample frame

due to non supply at the list of respondent by_the_study unit The Tesearcher-during their

routine inspection at respondent in SBI. The researcher to the respondents and this

created enough rapport between the researcher and the researcher.

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1.9.1 Frame Work of Analysis:

The data collected were arranged in concise and logical order and thus were

tabulated. A part of them was arranged in statistical tables.

1.9.2 Methods of Data Collection:

The data was collected from 100 samples. The entire samples were collected

Chromepet A pre - tested questionnaire was given to them and the data
from the Tiruchengode.

was collected.

1.9.3 Data Collection:

The study is based on both primary data and secondary data. To collect

primary data a detailed questionnaire were administers to respondent.

1.9.4 Primary Data:

Primary data those which are collected a freehand for the first time and thus

happen to be original in character. There are several methods of collecting primary

data. The researcher used questionarie method and collect data.

1.9.5 Secondary Data:

The researcher has been collected secondary data from the SBI in the form of

present customer services, customer satisfaction and customer behaviour and records

using these data, the researcher has applied co - efficient of range and trend analysis for

further inter predation

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1.10 LIMITATION:

It covers only limited numbers of population.

1. It is mainly based upon the customers not the other aspects.

Chromepet town.
2. The area of study is limited to Tiruchengode

3. This study is based on sampling process only. Therefore the accuracy & retable

cannot be obtained.

4. It is based on sampling process. So it is affected by two different types of errors -

Sampling errors and data collection errors

5. It is based on the sampling process. So easily may accrue errors. But very

difficult to check the omissions of errors.

1.11 CHAPTERISATION

Chapter J - Introduction and design of the study.

Chapter II - Review of literature.

Chapter III - Profile of the study area.

Chapter IV - Analysis and interpretation of data.

Chapter V - Summary of findings, suggestions and conclusions.

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References & Notes:

1.. E-commerce C. S. V. Murthy., Himalaya publishing House, Bangalore, 2006.

2. Marketing Management., C.B.Mamoria., R.K. Sun, Satish Mamoria., (2005).,
Kitnab Mahal., Allahabad., PM713, PP.732 to 733, PM736.
3. Principles of Marketing, Kotter, Armstrong, Prentice-Hall of India, New Delhi,
2004.
4. Marketing Management, Philip Kotter, Kevin Lane Keller, 2006, Pearson
education (Singapore) Pvt Ltd., New Delhi.
5. C.R. Mamoria., R.K.Suri., satish Mamoria., Marketing Management VII edition.,
2005., Kitab Mahal, Allhabad., PP.730 to 731.
6. Customer relationship management ILK.Sujandhi., New age International
Publishers, PP.91 to 94.

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