CRM Strategy

Abstract

The term “customer relationship management” emerged in the information technology vendor community in the mid‐1990s to refer to technology‐based solutions facilitating the management of customer data and the customer‐firm interface. In the academic community, CRM is associated with Relationship Marketing and is described as ‘information‐enabled relationship marketing’. The belief that CRM activities can enhance firm performance and that developing customer relationships can lead to profitability, led to an explosion of interest in the study and practice of CRM by both academics and executives, with many firms implementing CRM programs. Although the conceptual underpinnings of CRM are hardly questioned, the lack of agreement about what CRM should include, the conflicting implementation results, and some highly publicized failures, have created substantial concern and skepticism. The root of the problem appears to be in the implementation of CRM , which is proven challenging for firms. The mere implementation of CRM technology does not lead to the desired effect; it is instead the key reason for CRM failure. CRM should be positioned at a strategic level to yield positive results, complemented by a customer relationship orientation, and facilitated by a number of changes in organizational processes and alignment of these processes with technology.