Sunday, June 22, 2008

Lessons Learned v2.0 by Tolga YILDIRIM

Peter Drucker has influenced the way business people perceive what business is and the way they act and operate, by stating that the fundamental aim of a business is to create and keep profitable customers. His statement has shifted the focus from Fordism to customer-centric approaches. Today, business schools all around the world are embedding the importance of understanding customer needs, into their curriculums and companies, at least some of them, are trying hard to identify their customers and their needs, and make superior value propositions that the customers cannot refuse. CRM, which stands for Customer Relationship Management, is an invaluable element of this business endeavor.

Via utilizing CRM tools, companies seek to learn more about their customers’ needs and behaviors in order to develop stronger relationships with their customers. They can provide services and products that are exactly what customers want, offer better customer service and increase loyalty among customers. A good CRM application helps companies in two ways; first one is related to analyzing patterns, the second one is related to one-to-one relations.

Let us start with the first broad benefit. Pareto’s original 80/20 rule states that 80% of a nation’s wealth is enjoyed by the 20% of the society; where the remaining 20% of the wealth is enjoyed by 80% of the society. Pareto’s 80/20 rule can be applied to businesses, also. Most of the profits of businesses come from a couple of specific customer profiles. In order to align with Drucker’s ‘creating and keeping profitable customers’ idea, companies should seek to understand their customers, their behaviors and analyze patterns to increase the number of profitable customers they have. Good CRM implementations enable companies to do that.

Second broad benefit is dramatic effectiveness in one-to-one relationships with customers. Sales force gets the ability to close deals faster, and the ability to offer the best value proposition to a customer. Customer service increases and the individual customer feels he/she gets the treatment he/she deserves. Increased effectiveness in one-to-one relationships with customers directly raises loyalty, thereby helps companies keep profitable customers, and make each customer more profitable!

Siebel is the world-wide leader in CRM applications. Oracle has acquired Siebel, as well as Peoplesoft and JD Edwards. Siebel has specialized its CRM offerings into different industries, such as consumer goods, pharmaceuticals, financial services, in order to increase the effectiveness of its products. It has three different applications, which are Siebel CRM Enterprise, Siebel CRM Professional Edition and Siebel CRM OnDemand. It is highly remarkable that Siebel has added an on-demand solution to its portfolio as a traditional CRM software solution provider. It has five types of customers, which are, Siebel Web Client, Handheld client, Wireless web client, Mobile web client and Siebel Dedicated client.

During the analysis for ERP procurement, companies should perform SWOT analysis to understand the current, as well as potential future internal and external environment in addition to GAP analysis. During the decision making process, we should keep in mind the business objectives, critical success factors, key performance indicators and benefits.

1 comment:

sap upgrade automation said...

Thanks Tolga! It is great to know that Siebel is the world-wide leader in CRM applications. Oracle has acquired Siebel, as well as Peoplesoft and JD Edwards.