Question

customer relationship management (CRM) system:

What value does the system contribute to organisational efficiency and effectiveness? Does the system provide enough value to warrant the cost? Are there cost reduction measures that should be investigated?

Answer 1

Customer Relationship Management system contributes to organisational efficiency and effectiveness as it maintains systematic data about the customers of an organisation and leads for prospective customer. CRM are automated systems so they save time in information processing, data collection, recording and retrieval thus improving the efficiency and effectiveness of CRM. It enables sales professionals of a company to get access to customer information instantly and resolve customer problems in faster way. CRM also helps in forming targeted marketing campaigns as per the customer purchasing history and customer behaviour. CRM provides analysis of the data collected from customer shopping experience and can take steps in improving by collecting feedback.

Customer systems provide enough value to warrant the cost as it saves time and resources and utilize them more efficiently that increases customer satisfaction, customer retention and loyalty. It helps in communication with customer about their preferences, problems and future needs so that customized solutions can be provided to them and saves time for both the organisation and customer. It aims for creating life time value of customer relationships by focusing on customer's lifetime needs and serving them in ways as anticipated by the customers.

There are cost reduction measures like the software is convenient to use and reduces training costs. It helps in understanding and analysing the performance of sales professionals also and identify areas of improvement. CRM software also help in optimising costs related to incentives paid to sales professionals so that they are more justified.