Customer relationship model may be defined as a practice, technology, and strategy which is used by the many companies to manage and evaluate the customer data and interactions throughout the customer lifecycle in order to improve the business relationships with customers and it will also help in customer retention. The CRM system came into in existence with an effective software which helps and supports in organizing, collecting and managing the customer information and data.
There are numerous elements of customer relationship management model which are essential to run the business activities and operations successfully. It also helps to build and develop good relations with customers in the global market. Each and every component is effective and unique and plays a significant role in the process. The customer relationship model helps to generate revenue and profit of the company. The components of CRM model have been discussed below;
- Human resource management: It is a significant component of CRM model which plays a vital role to build and develop a relationship with customers. HRM uses human resources and skills in an effective manner. It is the backbone of the company. It is essential components for the large industries as well as medium industries. HRM uses effective strategies and policies to improve the skills and potential of the workforce. In this way, the firm can easily achieve goals and objectives of the firm.
- Lead management: Lead management is an essential component to lead and manage the sales and distribution process of the products and services. It is the process, methodology, practice, and system to create new potential business activities and operations within the organization. It is important for customer relationship management and sales management. It is used by the sales industries, customer executive centers, and marketing firms to maximize the profits of the firm. It also helps to improve the sales of the organization.
- Customer service: It is a most significant component of the customer relationship model to develop the relationship with customers. The company collects data and purchase information of the customers through CRM model. In this way, customer service is an essential element of the CRM. None of the company can survive its business activities and operations effectively without effective customer service. Therefore, it is an important element of the CRM Model. The firm should maintain loyalty and trust with its existing customers to increase the productivity of the organization.
- Marketing: It is the mandatory element of the CRM model in order to meet the course of action of the firm. It refers to the promotional activities which are used by a company in order to promote and endorse the products and services. The sales and revenue of the company depend on the marketing. Thus, CRM model assists and supports in the marketing process and procedure by improving and enhancing the effectiveness and efficiency of the policies and strategies. There are various elements of the marketing such as list management, call management, document management, and activity management. Therefore, marketing activities and strategies are used by the companies to increase the profit of the firm.
- Workflow automation: Work automation is required by the company to run the business activities and operations smoothly. It helps to reduce the cost and streamlining of the processes as well. Further, work automation does not only reduce the excess expenditures and costs but also prevent and avoid the repetition work by the different people. In this way, it plays a fundamental role to build the relationship with customers around the world.
- Business reporting: CRM model helps to manage and control the sales, and marketing activities within the organization. Further, it assists the customer care reports to handle the operations and work management. The business report also helps in forecasting to attain the long-term goals and objectives of the firm. Through the business report, the company can easily evaluate and analyze the risk and challenges of the market.
- Analytics: Analytics is the process and procedure of studying, evaluating and representing the data and information in order to observe and examine the trends in the global market. It is the significant component of the CRM model to develop the long-term relationship with customers. Analytics uses various types of charts, diagrams, figures and form of histograms in order to meet the mission and vision of the company.
Now it is assumed that various elements are associated with CRM model to build and develop an effective relationship with customers in the market. These components also help to improve the organizational structure of the firm and market as well. There are various benefits of the CRM model in the organization which have been discussed below.
- Improve customer relations: The primary aim of the CRM model is to improve the relationship with existing and new customers in the universal market. By using of CRM model the company maintains loyalty, honesty, confidence, and integrity among the people to attain the long-term success and growth of the company. Through CRM model, the company is able to provide good quality of products and services to its customers in the global market. It will also help to reduce and eliminate the conflicts, disputes, and agitation of the customers. The company also receives feedback from its loyal customers regarding the various products and services. Through CRM model, the firm provides satisfactory and efficient services to the customers.
- Increases customer revenues and profits: By using of CRM model the firm can increase the revenue and profit of the customers in the international market. Various marketing campaigns and programs can be easily conducted by the company with the help of CRM model. Along with this, CRM software helps to increase the sales of the products and services. Through this model, the company is able to reach its target customers in the global market. In this way, CRM plays a vital role to increase the profits and revenue of the company.
- Maximize the cross-selling and upselling: CRM model help to increase and maximize the upselling and cross-selling of the firm. Upselling and cross-selling is the practice which is given to the customers for the premium products and services across the world. CRM model also helps to provide complementary products and services to the customers. Through CRM model, the company is able to know the tastes, preferences, and requirements of the customers in the market. In this way, the company promotes and encourages upselling and cross-selling of the products.
- Better internal communication: CRM model helps to build and develop better communication and coordination within the organization. It will also help to increase the profitability and revenue of the firm. Through CRM model, optimum utilization of resources can be possible by the firm. It also increases the efficiency and productivity of the workers in order to determine the long-term goals and objectives of the firm.
- Optimize marketing: With the help of CRM model, the company is able to understand and measure the needs, behavior, and expectations of the customers. Further, it identifies and evaluates the correct and accurate time to sale the products and services of the company. It will also help to optimize marketing resources effectively and efficiently. It will also help to reach the target market in the world to attract more customers in the world.
Along with this CRM, model increases the level of satisfaction of the customers. It will also help to reduce the cost of the products and it will also increase the team collaboration and co-operation within the organization. It will also help to increase the number of customers in the global market.
The companies use this model to expand and flourish its business activities and operations across the world. In today’s era, customer relationship management is becoming very popular due to increase in the competition among all the business around the world. Through CRM model, the company is delivering the best quality of products and services. In this way, the company is exploring its business activities and operations of the firm. The company can overcome on the competitors in the global market.
It will also improve the financial position of the company. It is the customer-oriented model which protects the rights of the customers in the world. In this way, it provides various benefits to the customers around the world. It will also help to promote the advertisement and promotional strategies to meet the requirements and expectations of the customers. It will also help to maintain good communication among the customers in the market. Through CRM model, the company can understand the worth and values of the customers around the world. It also improves and develops the technologies to introduce the products and services in the market.
Read More: Gartner Competency Customer Relationship Model
Although, CRM model has been proved beneficial for the company as well as customers but it also consists some weaknesses which have been discussed below.
- Poor communication: It affects the buying behavior of the customers and they do not believe in product quality and quantity. Thus, the company should maintain proper communication with clients to increase the sale of the products. It is the significant concern which can affect the growth and progress of the firm.
- Lack of commitment: It is the significant disadvantage which is faced by the company while implementing CRM model. As result, the organization is not able to maintain an effective and unique relationship with clients as well as customers across the world. Further, clients get disappointment and they do not trust on the goodwill and reputation of the firm.
- Work leadership: It is one of biggest issues for any of the CRM implementation system and plan. The leaders are not able to maintain proper control on the subordinates to increase the revenue of the firm. Therefore, the company should focus on the leadership styles to implement the CRM model within the organization. An effective and good leadership contributes to success and growth of the firm. Along with this, it should use some effective and unique strategies to manage the workforce in the environment. The organization must resolve and overcome on the various challenges and risks which are existed in the global market.
On the above discussion, it has been concluded that customer relationship management plays an integral and significant role in every organization to build the relationship with customers in the market. It is an important source to generate revenue and profit of the company. Therefore, the companies must maintain an effective and excellent CRM model to provide satisfaction and morale to the customers. It also provides various benefits to the employees.