Customer relationship management (CRM) has become a key strategy for personalising the customer experience and improving customer. While CRM (Customer Relationship Management) systems have been around everything from their fitness activities to their home surveillance equipment. This article has been brought to you in collaboration with Cluboid. Bottom line, if you don't have effective customer relationship management The author has granted permission to Hotel Tech Report to post this article but has.
In the academic field, the discussion helps to point out several assumptions and questions for future research, as indicated in the last section of this article. In this paper the CRM phenomenon with a critical and dialectical view is being analyzed. Therefore, the next section presents the adopted methodology, according to the phenomenological approach.
The rest of the article is developed as follows: Phenomenology encourages us to back to the things themselves, it means, to approach phenomena that present themselves directly to us as conscious human beings, and attempt to understand their essences. It has at its centre "the initial recognition of essential intuition as the necessary condition for locating the experiential world that philosophers seek to understand" Natanson,p.
A phenomenon is what humans directly experience Crotty, ; Myers, In this study of the CRM phenomenon, a Heideggerian phenomenology has been followed. To Heidegger, the phenomenon shows some appearances, although the essence of it is behind such appearances. Heidegger, in contrast to Husserl's phenomenology, claims that it is not possible to acquire adequate evidence and complete freedom of prejudice when dealing with a phenomenon.
To Heidegger, there are no such things as wrong or right interpretations; life is always interpreting. Phenomenology, thus, is hermeneutic, which means, it is interpretative Dreyfus, ; Gadamer, Hermeneutics can be considered as a theory or philosophy of the interpretation of meaning.
It is primarily concerned with the meaning of a text or text-analogue. A text-analogue is anything that can be treated as a text, such as an event, an action, an organization or a culture, and even an Information System Boland, ; Myers, According to DreyfusHeidegger proposes a hermeneutics of everydayness that involves the understanding of everyday practices and discourse, but in a deep sense, since the fundamental aspects of our existence hide their structure behind common sense.
Researchers have to be suspicious and try to get a deeper and a clearer understanding of them. Researchers must be prepared to revise radically their traditional accounts of objects, subjects, language, space, truth, reality, time, etc, on the basis of the phenomena revealed by their interpretation. According to these propositions, Heidegger in the initial phase of his work claims a phenomenology of suspicion. This philosophical and methodological approach indicates the necessity of approaching organizational phenomena by questioning the models and concepts taken -for granted about them, and to pay attention to the unexpressed aspects of organizational life, observing the flow of events and considering that "the everyday apparitions should instead be looked at as symptoms, pointers to an organizational phenomenon that does not manifest itself directly.
Both appearances and apparitions are generated by the underlying phenomenon to be unveiled" Ciborra,p. According to Manen phenomenological studies cannot be formalized into a series of technical procedures. However, a variety of activities may be identified that can help in making a phenomenological inquiry. There are two main types of activities: Empirical inquiry activities aim to explore the range and varieties of pre-reflective experiential material that is appropriate for the phenomenon under study.
Reflective inquiry activities aim to interpret the aspects of meaning or meaningfulness that are associated with this phenomenon Manen,p.
Considering empirical activities, this study is based on previous works both in consultancy and in academic research by the authors, about CRM.
This previous empirical experience has been considered and the following reflective phenomenological methods have been applied Manen, Conceptual analysis - this is the process of examining a complex conceptual or linguistic entity into its most basic semantic constituents, considering that the meaning of a concept lies largely in its usage. In this study, the different definitions and concepts about CRM presented in the literature were revisited, as well as the ideas related to this concept, including: Etymological reflection - Frequently the words that are used to refer to a phenomenon have lost some of their original meaning.
Being attentive to the etymological origins of words may help the researchers to understand the origins and the essence of concepts that are usually taken for granted.
In this sense the origins of the term relationship have been analyzed, as well as its meaning and all that a relationship implies see next section, especially item The Meaning of Relationship. Collaborative reflective discussions - this type of discussion is helpful in generating deeper insights and understanding about a concept.
Themes and insights can be examined, articulated, reinterpreted or reformulated. The author's empirical experiences, both in consultancy and in academic research in the field of CRM and Information Technology applied in organizational processes have been discussed, as well as the concrete observations of unsuccessful experiences of CRM adoption.
The results of these discussions are presented throughout the article, but especially in Sections Discussion and Final Comments. It is important to clarify that this phenomenological approach is related to an interpretative research paradigm.
Following a Heideggerian phenomenology, the study is not free of biases, in the sense that even the choice of the subject of study is conditioned by the previous personal experiences of the authors, which includes a set of values and beliefs. This has to be considered as a limitation. This methodological approach was considered since it is valid for the purposes of this particular article in proposing a critical and reflective revision of CRM.
It does not follow the conditions of a positivist study. This paper aims to encourage reflection and indicate themes for future research that can be conducted later on according to different including positivist perspectives and methodologies. This limited scope has to be considered as another limitation of this particular study. By analyzing the different CRM definitions, it is possible to conclude that they can be split into three main CRM approaches.
These three different perspectives on CRM are classified in Table 1: CRM as a philosophy of doing businesses, which has to be considered above any kind of strategy or tool. A CRM philosophy is related to a customer-oriented culture keen on building and cultivating long-term relationships with customers. CRM as a strategy, as an organizational strategy that will drive functional plans and actions toward building relationships with customers. CRM as a tool, focused on the role of IT being used to gather, analyze and apply data to build and manage relationships with customers.
According to this business logic, the main idea is to use IT to develop, for instance, target marketing, saving money with untargeted, wasteful promotional campaigns. The CRM as strategy approach is related to a formal and deliberated plan and actions to articulate processes, people, structure and technology to acquire, select and retain customers with a high lifetime value to the firm, independently of the specific IT applied to support this strategy.
In its turn, the CRM as a philosophy approach goes beyond a deliberate strategy or tool application. It is related to positive attitudes towards all kinds of stakeholders. It involves a deep understanding of what relationship means and of all implications related to establishing a relationship such as trust, common objectives, increasing value on both sides, etc.
According to this type of analysis, this philosophy is supposed to guide organizational and functional strategies CRM as strategy ; these strategies, in their turn, would have to guide IT applications for CRM CRM as a tool - Figure 1. Considering CRM as philosophy is the background for any strategy and IT application, it is possible to have a better understanding of what it really means. For this purpose, the focus of the next section is the essence of the concept of CRM, by illuminating the understanding of the very concept of relationship.
The Meaning of Relationship In order to understand the essence of CRM, the meaning of the concept of relationship has to be discussed.
The section begins by analyzing the origins of this term, making an etymological reflection, as mentioned in the methodology section. Relation has the meaning of dependence between two things, liaison, friendship, to know each other, intimacy, reciprocity, political, commercial and cultural mutual interests.
By analyzing these different meanings of the term, it can be concluded that a relationship implies commitment, duties, mutual understanding and goals.
In this line of thought, Ford, Gadde, Hakansson and Snehotap. By exploring the literature, a set of conditions and implications that a relationship demands can be pointed out: Mutual knowledge - First of all, a relationship implies mutuality. In order for any state of affairs to be considered a relationship, both parties have to participate in and be aware of the existence of the relationship.
This means it must be inherently a two-way relation in nature. Symmetry - This is a combination of many relationship elements, including information sharing, dependence, and power. Symmetric relationships are more stable than asymmetric ones, because asymmetry undermines the balance of power and creates motivation for the stronger party to take advantage of the weaker party, especially in difficult economic conditions.
Long term orientation - As the very origin of the term relationship indicates, it has to have a long term orientation, with the idea of repetition. It demands that sometimes one of the sides will have to give up some current interests to sustain the long term relationship as a whole.
Communication - Ford et al. Communication is interpersonal and dependant upon a social context.
Mutual benefits and satisfaction - Another characteristic of a relationship is that satisfied customers are generally more inclined to remain in the relationship. According to O'Malley and Mitussisthe idea that both parties can derive value from a relationship requires consideration of the motivations, expectations, costs and rewards involved for both organizations and customers in a relationship.
Mutual trust and fairness - While relationship quality is a somewhat subjective term, it is plausible to measure relationship quality based on the levels of trust, commitment, and the ability to solve conflicts effectively. The higher the levels of these contributors, the greater the quality of the relationship: Mutual learning - In order for a company to develop a relationship with a customer, the learning relationship process is crucial.
The more the organization is prepared to learn from a customer in a close relationship, the more the company can provide exactly what the customer wants and the more the customer will invest in the relationship.
The opposite way is also true: Mutual commitment and efforts from both parties - To develop an efficient relationship, both sides have to commit themselves and invest efforts, such as "time spent developing contacts with the counterpart, or developing the offering or introducing different equipment or working practices" Ford et al.
Uniqueness - According to Ford et al. Anderson and Jap say that sometimes it is necessary to make unique adaptations or investments to support a relationship. Freedom - Ford et al. So unruliness is an essential aspect of any relationship, because it can never be fully controlled by one party. Uncertainty - since relationships have a time dimension, they have a future that is uncertain and a history whose interpretation is subjective and can be changed Ford et al. Their development depends upon how the parties involved view each other's capabilities and motives and how they interpret their own actions and those of others.
The interpretation can change throughout new experiences. Since a true relationship is based on emotions and implies elements such as mutual knowledge, some level of symmetry, long term orientation, communication, mutual benefits and satisfaction, mutual trust and fairness, mutual learning, mutual commitment, investments and efforts from both sides, uniqueness and, above all, freedom and uncertainty, it is important to question the very existence of a true relationship between a company and its customers.
Each one of these relationship characteristics could be analyzed, and for each one of them many obstacles and challenges could be found, considering a relationship between one organization and its customers as well as the role of IT in supporting a relationship.
Starting with the notion of mutual knowledge, the usual difficulties in knowing and gathering personal information about clients can be considered. It is not only an IT challenge; it also involves privacy and ethical issues. It is intimately related to the notion of symmetry, in the sense of information sharing, which is difficult for both parties - for the customer to access information about the firm and the firm to access information about the customer.
Extrapolating this power game beyond the organizational frontiers, it is easy to see how hard it would be to have asymmetry in a relationship with clients, especially in a capitalist environment. The same rationality is valid when the idea of a win-win approach for a full and lasting relationship is considered.
According to the usual managerial logic, the background is always the search for efficiency, cost reduction and profit maximizing, which is frequently obtained at the cost of maintaining long term relationships. On the other hand, according to the theory of consumer behavior Williamson, customers will attempt to maximize utility for themselves, frequently without caring about the organization or loyalty issues at all.
If self-interest, opportunism and lack of goal convergence even exist within a company, it is very difficult to establish a win-win relationship between the firms and their customers. Considering this economic rationality for analyzing some IT tool for CRM, it is possible to see these divergent interests in practice.
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For instance, call centers are frequently associated with CRM, while in practice something more impersonal, cost-reduction oriented than this kind of tool is hardly possible to find. Uniqueness a condition for a relationship is expensive.
When a firm imposes a cold, impersonal, machine-guided interface in its interaction with customers, all the assumptions of freedom, uniqueness and caring, go away. As another empirical example, where is the respect for freedom when a company uses IT to monitor their customers to detect changes in the level of consumption or to impose up-selling or cross-selling promotions?
Usually these practices carry out massive efforts to lock-in the customer, even throughout economic penalties or pressure. CRM IT tools are frequently applied to aid this kind of action, for instance, via data mining applications or up-selling and cross-selling engines inside CRM systems.
Going further and considering not only an economic perspective, but a social one, the complexity of power, ethical and emotional elements standing on the background of the idea of relationship can be easily seen. Taking, for instance, the notion of mutual trust, it is possible to see how fragile the ideal of establishing a deep, lasting, intimate relationship with clients in a world driven by contracts is Williamson, Britton and Rose compare personal and business relationships, claiming that they have many similarities.
They say that the benefits of a successful marriage include companionship, intimacy, personal growth, shared finances and shared household responsibilities, and must be perceived to provide value for both relationship members in order to last. However, considering the usual business logic, is it possible that this kind of relationship exists between a firm and its customers? It is relevant to question the very possibility of the existence of a true relationship between them, in the complete sense of the term, with all the economic, social and ethical implications that this kind of relationship implies.
Some authors help us to support this claim. To Dowling and Unclesusually a relationship program's goals are extremely clear in emphasizing companies' profitability. They point out that companies wish to maintain and augment their sales and profit levels, to increase customer loyalty and value and to induce customers to buy. The authors wonder how this can be called a relationship, since the companies' intention is one-sided.
After all, if you were to ask a friend or even a stranger to tell you about her relationships, it is most likely that the conversation would center on relationships with family, friends, neighbors, workmates and team members.
Relationships are intensely personal concepts. In fact, some people have great difficulty associating the term relationship with the commercial interaction between a company and its customers. As the author argues, relationships are based, at the end of the day, in emotional ties; they are so much deeper than a functional connection.
They are characterized by dimensions such as mutual respect, caring, empathy, warmth, social support and effective two-way communication Barnes, He claims that a large portion of what contributes to long-term satisfaction and loyalty has absolutely nothing to do with products or prices.
It has a great deal more to do with how the customer is treated, what he or she goes through and ultimately how he or she feels about dealing with a company. Going further, Dowling criticizes the relationship marketing idea in all kinds of company sectors since often the customer does not want to develop a relationship with a company.
Since a true relationship demands a lot of effort from both parties, it must have a strong motivational drive. Dowling believes that there exist at least three kinds of relations between a customer and a company: The author highlights that in the last case, customers can be very loyal, but do not desire to talk with the company, and this position needs to be respected. Moreover, in order to develop a good relationship with customers, the internal relationships within a firm have to have a sustainable basis.
To obtain a unified view of customers, different sectors have to exchange information about all processes and issues that involve them Payne, However, over the course of most companies' management history, the organizational chart has suggested that the boundaries between the different sectors have been rigid. These fixed barriers had resulted in different structures, languages, control systems, symbols, stories, paradigms, etc.
As mentioned above, there are different agents, interests and power games within the organization, while a CRM philosophy would demand putting the customer above all these differences. Bentum and Stonep. The information integration supported by the use of CRM IT tools has an essential role to play in this sense, but it cannot stand alone to promote a true and deep integration towards a customer-centered organization. Even considering that some level or kind of relationship between a company and its customers is established, ranging from a continuum of a very functional relationship to a very emotional one Barnes,p.
To manage a relationship requires a very arbitrary and unilateral attitude, which is in opposition to the very meaning of relationship.
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Much of what is labeled as customer relationship management in current business vocabulary is definitely one-sided Barnes, As mentioned in the call center example, CRM IT tools can be very hindering if used without a clear understanding of relationships. However, this kind of reflection rarely occurs in practice.
It is important to consider that in most cases, CRM software has been pushed onto the market by IT consulting firms and software houses, following the Internet and ERP systems boom in late 90's. Some previously non customer-oriented companies that acquired a CRM system, either as a result of the influence of IT consulting or competitors, have faced difficulties in CRM initiatives.
Some of these problems are outlined below: Frequently, they solve this problem by manipulating the metrics and financial values of taxes involved. As CRM is a complex project that involves all departments in a company, firms usually try to adopt CRM on a large scale. In Thailand, a survey was conducted from hotels, it showed that such measures was taken by hotels in order to sustain long-term relationships with customers, like excellent interactions among employees and customers, may well build an affirmative reputation of a hotel.
Therefore this study proposes following hypothesis: Service standard and reputation are known to be prerequisite to customer satisfaction and trust in order to build customer loyalty in service centers. Moreover, Nesset et al. From the perspective of marketing, the impact of reputation on consumer behavior is well-recognized, despite the lack of empirical evidence [ 20 ]. Emphasized that not every disappointed customer apparently raise their voice about displeasing experiences by protesting to the firm, and as an alternative, they stop patronizing.
However, they found that the most influencing factors affecting customers raise their voice and complain about their dissatisfaction is reputation. Customer-perceived quality directly affects the perception of reputation [ 23 ]. Favorable image of the company develop by the customers who anticipate service standard over continuous service experience, and this image helps form an emotional attachment [ 24 ].
Recently, few studies indicated that food, physical environment, and service should be functioned as vital components of restaurant experience in forming the perceptions of the restaurant service standard in the restaurant industry [ 25 ].
Service standard is normally observed as a total assessment of the services delivered [ 26 ]. Some researchers defined service standard as the contrast between service perception and customer expectations. They believe that assessing service standard as the dissimilarity among expectations and perceptions is authentic and permits for the identification of gaps in services which are provided to customers [ 27 ].
Every person in service providing firm interact with the clients and communicate the aspects which are associated to the behavioral and physical attributes of a company like architecture, business name, services and impression of quality and, variety of products [ 28 ].
A positive image represents an asset to the service provider, and customers often trust that the provider will not jeopardize this by decreasing its service standard level [ 29 ]. Customers nowadays are reluctant to compromise on service standard, and therefore service standard has turn out to be the key to customer acknowledgement.
A firm can attain competitive advantage by offering unique perceived value that often proves challenging for the rivalry to compete with consequently increasing customer loyalty [ 30 ]. The literature shows that the relationship concerning customer satisfaction and image can go both ways, which may collectively create a collaborative influence over loyalty of customers. In other words, Greater the positive image will be expected of hotel if customers are satisfied.
Possibly, customers who formed the positive images of a hotel regarding their past experiences might experience more satisfaction level throughout following visits. Therefore, this study proposes following hypothesis: As the service standard is becoming an important part of business practice in the tourism and hotel industries, it is necessary to describe clearly the quality of hotel services and develops a psychometrically sound measurement tool [ 32 ].
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Another important factor is the reputation which is dealing with the gap in the integration model of the customer loyalty, customer fulfillment, and the perceived service standard.
On the other hand, the association among perceived service standard and reputation is hard to examine, because of the services given by hotels comes under untouchable [ 34 ]. The guests will be impressed and level of satisfaction will be raised by such kind of systems. Therefore this study proposes following hypothesis Figure 1.
In figure below, the main variable of the study are relationship orientation, reputation and service standard.
Research Methodology Sampling and data collection The objective of the study was to investigate the influence of relationship orientation on service standard and reputation and interrelationship between reputation and service standard in the hotel industry of Pakistan.
The target population of this study was the tourists, visitors and adventure seeker who had stayed in the hotels. Total questionnaires were distributed among the respondents in different cities of Pakistan, were returned. The respondents were selected conveniently and asked to complete questionnaire. The valid response rate was the The first part of the questionnaire contained nine questions relating to Relationship orientation dimension relationship orientation and mutual disclosure.
The second part of the questionnaire contains 10 questions related to the reputation dimension operational image and functional image. Another section includes items related to service standard dimension reliable and earnest services, physical equipment, decoration and environment, personal concern and response to customers. Measures The variables in this study were measured with scales obtained from the literature.
Relationship orientation was measured according to the dimensions [ 37 ] and its Cronbach alpha is 0. The instrument used to measure reputation dimension operational image and functional image has been adapted from [ 38 - 40 ] and its Cronbach alpha is 0.
The items suggested by [ 9 ] to cover service standard dimension reliable and earnest services, physical equipment, decoration and environment, personal concern and response to customers and its Cronbach alpha is 0.
Data analysis Statistical package for social sciences software was used for data analysis. To measure the internal consistency of scales reliability analysis was conducted by computing the Cronbach alpha in the analysis process. A descriptive statistical analysis was performed to gather demographic information of the respondents.
Correlation analysis was conducted to check the relationship among the variables of the study. A hierarchical regression analysis was performed to know the best influence of relationship orientation on service standard and reputation moreover a simultaneous regression was also performed to know the interrelationship between service standard and reputation. Results and Discussion The Figure 2 presents the descriptive statistics of research variable dimensions which highlights lowest to highest means ranged from 3.
In relationship orientation; mutual disclosure dimension has the highest mean score which is 3. In reputation, the operational image dimension has the highest mean score is 3. The dimensions of service standard consists the decoration, physical equipment and environment has top scored mean which is 3. Moreover, to see the relationship among the research variables; correlation analysis was performed which has also been showed in Figure 2, that clearly indicate the research variable dimensions are highly correlated to each other.
This research furthermore investigates that relationship orientation, service standard, and reputation are highly correlated with each other. So, hierarchical regression has been performed to find the influence of these variables on each other, results are presented in Figure 3. Frequency analysis and correlation analysis of research. Hierarchical regression analysis on the effect of variables of service quality and relationship marketing on corporate image.
Hierarchical regression analysis on the effect of Relationship marketing and corporate image on service quality. Hence, H1 in the research maintains customer relationships by relationship-marketing activities of hotels has positive influence on perception of customers about reputation, is proved.