02 Jul Customer Relationship Management (CRM)
In the early 2000s, several practitioners and authors have predicted the overshadowing of customer relationship management (CRM) systems by what is called enterprise resource planning systems II (ERP II). ERP II was envisioned to virtually cover all the processes within organizations from supply chain, CRM, to e-business. In 2000, Gartner group published an article titled “ERP is dead, long live ERP” in which they argued that in near future, ERP systems will overcome the need for other specialized systems (e.g. CRM). While there have been major advances in ERP systems since then, and the fact that most current ERP systems include CRM modules and applications, however, separate CRM systems are still widely adopted by organizations.
CRM is not a new area. It is described as core organizational processes that focus on establishing, maintaining, and enhancing long-term associations with customers 14. These processes can be supported technologically by CRM systems. Prior literature points out the importance of a single-view of the customer across all contact channels 15, which CRM systems play a big role in supporting this view by integrating the data among the sales and marketing teams and providing suitable reporting capabilities. CRM Systems are typically considered a type of Enterprise Systems (ES). Even though existing literature differentiates between ERP capturing operational (internal) data and CRM capturing customer (external) data 16, most ERP systems nowadays have a module for customer relationship management included. With many CRM solutions establishing themselves in the market, such as Salesforce, SugarCRM, Hubspot and other providers, the CRM market totalled 26,2 Billion USD in 2015, and Salesforce is the current market leader and holds a market share of 19,7% 17. Salesforce is a cloud-only provider, which, besides sales modules, offers modules for marketing, service desks, analytics, community (social networks) and e-commerce. Reinartz et al. (2004) state that the use of CRM systems is “expected to boost the ability of an organization to sustain profitable customer relationships by enabling information to be integrated and shared smoothly”. Customer relationship is assumed to be a people-driven process 15, meaning that building and enforcing customer relationships have to come from within the organization and the people therein, and the CRM system can only support these processes. Prior research in this area even found that by implementing a CRM system without the established processes and people in place, the actual customer relationship performance can decrease (Haddara et al, 2017).
Social Customer Relationship Management (Social CRM)
Social CRM strategy is a novel version of CRM empowered by social media technology that offers a new way of managing relationships with customers effectively. The adoption, use, and performance of social Customer Relationship Management (CRM) strategy have emerged as an active research area in the scholar and professional environment particularly for Small and Medium Enterprises (SMEs) with limited resources. Social media technology introduces social CRM as a new version of CRM strategy (Malthouse, Haenlein, Skiera, Wege, & Zhang, 2013).
In fact, the growth of social media technology questions the old-style concept of CRM. Rather than focusing on traditional CRM technologies in the form of packages such as Sage CRM Cloud or Salesforce, the focus of social CRM is on social media technology. Social media technology introduces social CRM as a new version of CRM strategy (Malthouse et al, 2013).
Social CRM research is significant because of advantages of social CRM on country’s development through improvement of SMEs performance.
Today, social media technology has become a crucial part of human life as customers produce content, share photos, choose to ‘like’, or interact in the social media environment. Indeed, social media technology not only affects human behaviour but also it significantly impacts organization behaviour. Social media technology has presented new customer-centric resources that allow customers to interact with others and with businesses (Kietzmann et al., 2011). The mixing of social media technology inside a CRM strategy is a rising circumstance, leading to an innovative efficient model which can be explained as social CRM (Askool & Nakata, 2011; Harrigan & Miles, 2014). It is an integrated, customer-oriented and strategic management method defined by means of ‘a viewpoint and a business strategy, supported by a technology, business instructions, processes and social features, planned to involve the customers in a cooperative connection in order to provide value for business’ (Greenberg, 2009; Peters, Pressey, & Greenberg, 2010; Ahani et al, 2017).
- Ahani, A., Nor Zairah, A. b., Mehrbakhsh Nilashi, R. (2017). “Forecasting social CRM adoption in SMEs: A combined SEM-neural network method”. Computers in Human Behavior, S0747-5632(17)30353-9.
- Haddara, M., Constantini, A. (2017). “ERP II is Dead- Long Live CRM”. Procedia Computer Science, Volume 121, Pages 950–959.
- Reinartz, W., Krafft, M., Hoyer, W. D. (2004). “The customer relationship management process: Its measurement and impact on performance”. Journal of marketing research, 41(3):293-305