Issues in Implementing CRM: A Case Study

By Da Silva, Rui; Rahimi, Ilan | Issues in Informing Science & Information Technology, Annual 2004 | Go to article overview

Issues in Implementing CRM: A Case Study


Da Silva, Rui, Rahimi, Ilan, Issues in Informing Science & Information Technology


Introduction

The use of CRM (Customer Relationship Management) systems in diverse industries is now common around the globe. However, the fact that many companies have undergone this process does not mean that it's easy to implement such a system, let alone decide to go through such a process. In fact, because of the substantial investment needed, many expect a return on this investment. In reality most of the time that expectation is not fulfilled. Usually 50%-70% of the times the project fails (Morrel & Philonenko, 2001).

The reason a CRM project fails lies in the way companies regard CRM systems. Light (2001) claims that because companies view CRM as a technological project that is bounded by time and budget instead of regarding CRM as a long term commitment to efficiency and improvement, the project will definitely fail. Ryals, Knox, and Maklan, (2001) agree with Light's view and contend that CRM should by regarded as a holistic view including a strategy that permits organizational changes and organizational processes. The technological should not be overlooked in the process but one has to remember that is only means to an end.

Holland and Light (1999) present a model that includes Critical Success Factors to insure swift ERP implementation. It is based on tactical and strategic factors, and on Slevin and Pinto's (1987) model that was modified by the two. It is argued in this paper that ERP and CRM implementation processes are similar. Therefore we aim to check two main issues: (a) Can Holland and Light's (1999) model for critical success factors be applied to CRM, and (b) What modifications in their model that reviewed ERP systems should be adapted to CRM implementation.

The case study of three companies reviewed for this paper is presented here. The review leads to the conclusion that Holland and Light's (1999) model can be extended to the implementation of CRM systems.

The next section presents key definitions concerning CRM and CSF. Following that is a review of the research methodology used; a review of the three case studies is next. Finally, we present an analysis that leads to the conclusion of the current paper.

Customer Relationship Management Framework

Despite the fact that CRM as a concept has emerged only recently in both the IT and marketing fields, the literature offers multiple definitions of CRM. Four definitions were chosen to demonstrate the correlation between Information Systems and Marketing, both of which comprise the two major components of CRM:

* _CRM is at the core of any customer-focused business strategy and includes the people, processes, and technology questions associated with marketing, sales, and service". (See http://www.realmarket.com/crmdefine.html)

* "CRM is defined as a management approach that enables organizations to identify, attract and increase retention of profitable customers by managing relationships with them" (Ryals et al., 2001).

* "..practicing elements of an approach to marketing that uses continuously refined information about current and potential customers to anticipate and respond to their needs" (Peppard, 2000).

* "CRM is not a technology or even a group of technologies. It is a continually evolving process that requires a shift in attitude away from the traditional business model of focusing internally. CRM is an approach a company takes toward its customers supported by thoughtful investment in people, technology and business processes" (Morrel & Philonenko, 2001).

With regards to the Marketing component of CRM, Kutner and Cripps (1997) emphasize that CRM is all about the customer: Customers must be viewed as the company's most important. In addition, they claim that contrary to previous attitudes, customers are very different in their need, preferences and buying habits and are not equally desirable as each one generates different profits. …

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