Analysis on the failure and success factors of the

2022-10-15
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Customer Relationship Management (CRM) is a management concept that has developed rapidly with the strategic transfer of enterprise business model from "product centered" to "customer centered". Its core idea is to take customers as the most important resources of enterprises, through improving customer service and in-depth analysis of customers, to meet customer needs and ensure the realization of customer lifetime value. Its emergence and development is the inevitable result of economic development

I. overview of CRM application in enterprises

customer relationship management is the most valuable tool that rose in Europe and the United States in the 1990s to create profits for enterprises. In 2004, CRM was rated as one of the five best management tools in the world. Enterprises can improve the retention rate of customers through CRM. According to the data, if the customer retention rate is increased by 5%, the profit can be increased by 80%

because CRM can improve the profits of enterprises and realize the lifetime value of customers, enterprises are very enthusiastic about it, and major companies have opened CRM projects. According to IDC statistics

according to the data provided in Table 1, the average annual growth rate of global CRM market revenue from 1999 to 2004 is about 38%. This data shows that in recent years, enterprises' investment in CRM projects has increased year by year, and the number of enterprises opening CRM projects has increased year by year

obviously, when companies set up CRM projects, they all thought that CRM would quickly bring return to their investment, but the result was not as good as they thought. Most reports show that only 25% - 30% of the enterprises that have implemented the CRM plan have received the expected return

II. Cause analysis of CRM failure

through the description of the above overview, it can be seen that the application of CRM in enterprises is not successful, but has a high failure rate. Is it the mistake of CRM concept? Of course not. The emergence and development of CRM is the inevitable result of economic development. Nowadays, the fierce market competition makes commodities more and more homogeneous. The focus of customers' choice of commodities has shifted from product quality to service quality and other added value. Therefore, the concept of "customer-centered" is certainly correct, and it must be the strategic concept of enterprises in the future. It can be seen that the failure of CRM should be analyzed from its implementation

1. Difficulties in the reform of enterprise management culture

in the management culture of many enterprises, the concept of "product centered" is so strong that any change will be a huge challenge. The core idea of CRM is "customer-centered". The introduction of this idea just conflicts with the inherent concept, which makes CRM encounter great difficulties in the application of enterprises. It can be seen from table 2 that more than half of CRM failures are caused by corporate politics, business inertia and organizational structure adjustment, which shows that the difficulty of implementing CRM lies in the difficulty of corporate culture reform

2. Lack of understanding of CRM

some people believe that CRM is to locate customers and customer groups based on personalized needs, so CRM is simply regarded as a way to obtain customers' names and addresses, confusing the difference between CRM and database marketing. Database marketing is a promotional means of enterprise marketing department. It carries out targeted promotional activities on the basis of preliminary analysis of customer database. It is a point solution. CRM not only includes business close integration and rich function sales automation applications, but also its application of analysis model based on data warehouse and data mining technology is incomparable to database marketing. In addition, there are many other misunderstandings to varying degrees, such as CRM is a technology, CRM system is a call 2.1, the error caused by the incorrect installation of the experimental machine, the installation of the experimental machine is not level center, CRM is to make all customers 100% satisfied, etc. These misunderstandings have hindered the successful implementation of CRM to a certain extent

3. Lack of plan

lack of plan includes two significant factors: poor planning and budget problems in Table 2, accounting for 16% of CRM failures. Many enterprises spend a lot of money on CRM, but they don't know which customers these funds need to spend to bring the maximum benefits. This is a budgetary issue. When introducing CRM projects, enterprises should be clear about where to invest and where to reduce the unnecessary concept funds half a year after the operation, so as to obtain the maximum return on investment. In addition, the specific implementation of CRM requires enterprises to formulate specific strategies. If an enterprise does not have a clear strategic goal, it is difficult to imagine how it can define "what I want to get from CRM". Enterprises need to really understand what capabilities they should have when meeting specific customer needs? What kind of goals should CRM achieve? How to define the criteria for successful CRM implementation? Only by clarifying this standard can enterprises succeed in the implementation of CRM

4. Lack of CRM skills

crm is a high-tech project, and the front-line personnel do not know how to use it well. Although many companies have sophisticated CRM technology, they do not realize that such cutting-edge technology requires high-quality users, thus ignoring the training of CRM users. This is one of the main reasons for the failure of CRM application

III. analysis of success factors

although there is a high failure rate in the application of CRM, many enterprises continue to invest in CRM. This is because its "customer-centric" concept is the inevitable trend of enterprise development. So how to make the input of CRM generate revenue, that is, how to successfully implement CRM, is an important issue that enterprises pay attention to

the success of CRM should include three main stages: understanding, planning and implementation. Understanding means to fully and correctly understand CRM first; Plan refers to formulating clear objectives on the basis of understanding; Implementation refers to multi-party cooperation and implementation

1. In the recognition stage, CRM is a management project, not just a software or technology, so it needs the attention of the top management of the enterprise, which is often referred to as the "top-level project". The participation of senior leaders can better match the CRM system with the management system and management process of the enterprise, better coordinate the resources of various business departments, and make the completion of various business links with active PbO2 as the core more smooth

of course, after the top-down system application rules are established, employees can understand the purpose of enterprise application of CHM and the problems that CRM system can really solve for employees. Relevant experts have found that when the goal of CRM is consistent with the interests of employees, the success rate of CRM will be greatly improved

2. Planning stage

a successful CRM project implementation must have clear stage objectives. As the initiator of the CRM project or the person in charge of the future project, we must put into words the clear vision and recent realization objectives that have been formed and unanimously agreed within the enterprise, and clearly reflect the business objectives, realization cycle, expected revenue and other contents. This document will be one of the most valuable documents in the whole project implementation process. It is not only the text embodiment of the common understanding of the enterprise on the CRM project before the project is launched, but also the goal and direction in the implementation process. At the same time, it is also an important measure of the success of the project after the completion of the project

3. The success of CRM in the implementation stage must be organized and implemented by an experienced supplier. Such suppliers know how to systematically guide enterprises to complete business processes, establish customer-centric fine business rules, improve customer value evaluation system, etc. they are also very clear about the competitive environment, management status, CRM difficulties faced by enterprises, how to overcome, and how to avoid risks in project implementation

in the process of implementation, enterprises and system providers need to cooperate closely to standardize and refine the implementation process. For example, we should first import the concept, then sort out the business, solidify the process, and deploy the system. Both parties should plan the implementation work to every day and every week to ensure the level promotion and efficiency of the project, so as to effectively control the risk. (end)

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