Enhancing Customer Relationship Management system...
Transcript of Enhancing Customer Relationship Management system...
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ARAB ACADEMY FOR SCIENCE, TECHNOLOGY
AND MARITIME TRANSPORT
College of Computing and Information Technology
Department of Information Systems
Enhancing Customer Relationship
Management system Effectiveness Using
Balanced Scorecard Model
For a Telecommunication Organization
By Rehab Mohamed Hussein Salman
A thesis submitted to AASTMT in partial
Fulfillment of the requirements for the award of the degree of
MASTER of Science in Information Systems
Supervised By
Prof. Dr. Mostafa Abd El-Azim Essam El-Din Fawzy El-Fakharany, PhD.
Prof. of computer science
College of Computing and Information Technology
AASTMT
College of Management and Technology-
AASTMT
Mohamed Bakr Abdelhalim, PhD.
College of Computing and Information Technology AASTMT
2012
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Acknowledgements
I want to express my deepest gratitude for my professors and
thesis supervisors Dr. Essam EL-Fakharany, Prof. Dr.
Mostafa Abd El-Azim and Dr. Mohamed Bakr for their major
help and support through all the phases of research and
development.
Special Dedication
I dedicate this dissertation to Prof. Dr. Mohamed Quota who
passed away few months before submitting this thesis, Even
though he is not here today to share my happiness and
success. I am sure he is happier in a better place.
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بسم هللا الرحمه الرحيم
وقل اعملوا فسيرى هللاه "
"عملكم ورسوله والمؤمنون
صدق هللا
العظيم [٥٠١: التوبة]
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Published Work:
The work in the thesis is published as follows:
1. R.Salman, E.el-Fakharany, the Evaluation of CRM In
Telecommunication company Using Balanced Scorecard, The
Journal of AL Azhar University, Engineering sector, JAUES,
ISSN: 1110-6409, 2011.
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Abstract
In this research we study and implement an evaluation model of Balanced
ScoreCard (BSC) which has an iterative process that assesses the effectiveness of
CRM. This model evaluates the CRM effectiveness through a framework of
measurements. The first step in this framework is to determine the CRM mission and
goal in the organization, then establish a CRM strategy and figure out the principle
strategic factors. Based on the completion of the previous steps, find the
interrelationships among CRM activities and business goals within the organization,
and analyzing these relationships by cause and effect relationship analysis to achieve
better outcomes and select the most efficient business perspectives in order to
achieve the targeted goals and objectives of the organization.
Based on the evaluation analysis of the actual success results versus the
business targets will help the organization in enhancing the effectiveness of CRM.
In this thesis, we used a BSC model that is measuring the effectiveness of
CRM through four perspectives, customer knowledge (CK), customer interaction
(CI), customer value (CV), and customer satisfaction (CS) and each one of these
perspectives consists of a number of appropriate metrics, which should be adapted to
suit organizations in different industries.
We applied this model to enhance the CRM system in a Telecommunication
Company. In 2010, X-Telecom moved from traditional CRM evaluation models to
BSC evaluation model that is described earlier. Accordingly, we ran this research to
evaluate the effectiveness of the new BSC model, through comparing the Key
Performance Indicators (KPIs) results of year 2011 with the year before, in order to
measure the impact of new enhancements on X telecom‘s CRM system using the
new BSC model.
The measures were selected according to the X-Telecom business goals and
objectives. And it was evaluated through expert interviews, financial reports, and
customer feedback questionnaires that will described later.
After applying the BSC model and assuming to give the four BSC
perspectives an equal weight of 25% of the total measurement, and comparing the
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targets and outcomes of Period 1 year (2009- 2010) and Period 2 of year (2010-
2011), we can conclude that using the Balanced Scorecard has helped the company
to achieve an increase of 8% in the Customer knowledge, 13% in Customer Value,
11% in customer interaction and 10% in customer satisfaction.
Moreover, we set other measures to separate the perpetual normal growth
percentage from the total growth of the four BSC perspectives in order to assess the
standalone impact of using the BSC, which resulted as 5.3% increase in customer
knowledge, 2.7% increase in customer interaction, 9.3% increase in customer value
and 8% increase in customer satisfaction. Based on our model, we proved that BSC
can enhance CRM system to evaluate the effectiveness of CRM in the organization.
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TABLE OF CONTENTS
Abstract .................................................................................................................................... V
LIST OF FIGURES ....................................................................................................................... X
LIST OF TABLES ....................................................................................................................... XII
List of Abbreviations ............................................................................................................. XIII
Chapter One: Introduction
1.1 Overview ........................................................................................................................ - 1 -
1.2 Motivations .................................................................................................................... - 2 -
1.3 Problem Definition ......................................................................................................... - 2 -
1.4 Research Objectives ....................................................................................................... - 2 -
1.5 Research Methodology .................................................................................................. - 3 -
1.6 Thesis Contribution ........................................................................................................ - 3 -
1.7 Thesis Organization ........................................................................................................ - 4 -
Chapter Two: Customer Relationship Management
2.1 Customer Relationship Management (CRM) Definitions ............................................... - 6 -
2.2 CRM Architecture ........................................................................................................... - 7 -
2.2.1 Information Technology Perspective. ......................................................................... - 7 -
2.2.2 Customer Life Cycle ‘CLC’ Perspective ........................................................................ - 9 -
2.2.3 Business Strategy Perspective .................................................................................... - 9 -
2.3 CRM Elements .............................................................................................................. - 11 -
2.4 Characteristics of CRM ................................................................................................. - 11 -
2.5 Goals of CRM ................................................................................................................ - 12 -
2.6 Customer Information Architecture in CRM ................................................................ - 14 -
2.7 CRM Types.................................................................................................................... - 15 -
2.7.1 Operational CRM ....................................................................................................... - 15 -
2.7.2 Analytical CRM .......................................................................................................... - 15 -
2.7.3 Sales Intelligence CRM .............................................................................................. - 16 -
2.7.4 Collaborative CRM .................................................................................................... - 16 -
2.8 CRM Strategy ............................................................................................................... - 18 -
Chapter Three: Applications of CRM in Telecommunication Sector
3.1 Telecommunication sector .......................................................................................... - 21 -
3.2 Contact Center ............................................................................................................. - 22 -
3.3 Contact Center Elements ............................................................................................. - 23 -
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3.4 Contact Center Structure ............................................................................................. - 24 -
3.5 Integrated CRM with contact center system ............................................................... - 27 -
3.6 Telecommunication CRM Applications ........................................................................ - 28 -
3.6.1 CRM Applications and Business Interactions ............................................................ - 28 -
3.6.2 Siebel CRM Applications ........................................................................................... - 29 -
3.6.3 SAP CRM .................................................................................................................... - 30 -
3.6.4 SalesForce CRM application ...................................................................................... - 30 -
3.6.5 CRM Application Survey ............................................................................................ - 31 -
3.7 Loyalty management in CRM ....................................................................................... - 32 -
3.8 How to build customer loyalty in Telecommunication ................................................ - 33 -
3.9 Customer Satisfaction .................................................................................................. - 35 -
Chapter Four: CRM Frameworks Literature Review
4.1 CRM measurement ...................................................................................................... - 38 -
4.2 The Measurement Orientations .................................................................................. - 40 -
4.2.1 Measurement Relation with Time ............................................................................ - 41 -
4.3 CRM Success Metrics ................................................................................................... - 42 -
4.3.1 Productivity metrics .................................................................................................. - 44 -
4.3.2 Operational metrics .................................................................................................. - 44 -
4.3.3 Resulting metrics ....................................................................................................... - 45 -
4.4 CRM Measurements Methods ..................................................................................... - 45 -
Chapter Five: Balanced Scorecard Model
5.1 Balanced Scorecard ...................................................................................................... - 51 -
5.2 Literature Review of BSC .............................................................................................. - 51 -
5.3 Why the Balanced ScoreCard ....................................................................................... - 53 -
5.4 Success stories of BSC .................................................................................................. - 56 -
5.5 BSC Design .................................................................................................................... - 63 -
5.5.1 Customer Centric Balanced Scorecard ...................................................................... - 65 -
5.6 BSC Model .................................................................................................................... - 66 -
5.6.1 Cause-and-Effect Relationship .................................................................................. - 66 -
5.6.2 Model perspectives ................................................................................................... - 68 -
Chapter Six: BSC Implementation and Analysis
6.1 BSC in Telecommunication Company .......................................................................... - 76 -
6.2 First year Analysis .................................................................................................. - 78 -
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6.3 Implementation of BSC model on X-Telecom .............................................................. - 80 -
6.3.1 X-Telecom CRM Goals ............................................................................................... - 80 -
6.3.2 X-Telecom Strategy Map ........................................................................................... - 80 -
6.3.3 Cause and Effect Relation Model .............................................................................. - 82 -
6.3.4 Measurement Selection ............................................................................................ - 82 -
6.4 Result analysis after BSC Model ................................................................................... - 84 -
6.4.1 Questionnaire analysis .............................................................................................. - 85 -
6.4.2 Interview Analysis ..................................................................................................... - 87 -
Chapter Seven: BSC Results
7.1 The Evaluation of X-Telecom BSC Model ..................................................................... - 93 -
7.2 Comparing Results ....................................................................................................... - 95 -
7.3 The Impact of BSC on Total Growth ............................................................................. - 98 -
Chapter Eight: Conclusions, Recommendations and Future Work
Chapter Eight: Conclusions, Recommendations and Future Work ................................ - 102 -
8.1 Conclusions ................................................................................................................ - 102 -
8.2 Recommendations ..................................................................................................... - 104 -
8.2.1 Objectives of “Recommend the Best” program ..................................................... - 104 -
8.2.2 Program Facts ......................................................................................................... - 105 -
8.2.3 The Benefits of the Program: .................................................................................. - 105 -
8.3 Limitations and Future Work ..................................................................................... - 105 -
References .................................................................................................................. - 107 -
Appendix ........................................................................................................... -116-
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LIST OF FIGURES
Figure NO Caption Page
1.1 Research Methodology 3
2.1 Relationships Between IT And CRM 7
2.2 The Industry Data And Information With, Marketing And
Customer Support
8
2.3 Customer Life Cycles ‗CLC‘ 9
2.4 CRM Marketing Teacher Model And Business Strategy 10
2.5 Key Elements Of CRM Architecture 10
2.6 CONVIO Approach For E-CRM 18
3.1 Static SBR Example
25
3.2 Dynamic SBR Example
25
3.3 Handle Calls Machine 26
3.4 Loyalty Management In CRM
32
4.1 The Measurement Orientations 40
4.2 Measurement Related To Time 41
4.3 Human Capital Intelligence Systems 46
4.4 Strategic Workforce Intelligence Framework 47
4.5 Lev Value Chain Scoreboard Model 48
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5.1 Regional Airline Balanced Scorecard 62
5.2 Generic Government Strategy Map 63
5.3 BSC Design as Norton and Kaplan 64
5.4 Company Centric Vs. Customer Centric BSC
65
5.5 BSC Evaluation Model 66
5.6 Cause-And-Effect Relationships 67
5.7 BSC Model Perspectives 68
6.1 X-Telecom Organization Chart 77
6.2 Evaluation To Target Before BSC For 2009-2010 79
6.3 X-Telecom Strategy Map 81
6.4 Cause and Effect Relationship Model
82
6.5 Questionnaire Results 87
6.6 Evaluation to Target Results after BSC 91
7.1 Evaluation Results of CK 95
7.2 Evaluation Results of CI 96
7.3 Evaluation Results of CV 97
7.4 Evaluation Results of CS 97
7.5 Comparing Two Years Results 98
7.6 BSC Impact On Total Growth 100
7.7 The Combination Results 100
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LIST OF TABLES
Table No Caption Page
3.1 Top CRM Vendors Comparison 31
5.1 Customer Knowledge Measures 70
5.2 Customer Interaction Measures 71
5.3 Customer Value Measures 72
5.4 Customer Satisfaction Measures 74
7.1 Evaluation Of BSC Model 93
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List of Abbreviations
Symbols Nomenclatures
ACD Automatic Call Distribution
ACW After Call Work
APIs Application Programming Interfaces
ARPU Average Revenue Per User
BSC Balanced ScoreCard
BSP Business Strategy Perspective
CBA Cost Benefit Analysis
CCC Call Center Contact
CI Customer Interaction
CIA Customer Information Architecture
CK Customer Knowledge
CLC Customer Life Cycle
CRM Customer Relationship Management
CS Customer Satisfaction
CTI Computer Telephony Integration
CV Customer Value
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CVM Customer Value Management
DBMS Database Management System
DFAS Defense Financial Accounting Service
DM Data Mining
EBU Enterprise Business Unit
EVA Economic Added Value
GCRM Geographic Customer Relationship Management
GUI Graphical User Interface
HCI Human capital Intelligence system
IVR Interactive Voice Response
KPIs Key Performance Indicators
LANs Local Area Networks
PLC Product Life Cycle
ROM Return On Management
SBR Skill Based Routing
SFA Sales force Automation
SME Small-Medium Enterprise
SOHO Small Office / Home Office
WWW World Wide Web