The effect of CRM

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THE EFFECT OF CRM ON BANKING PROFIT

Not everything that can be counted counts, and not everything that counts can be counted (Albert Einstein 1879-1955)

Make all of your customers love you and buy more of your stuff.

Customer relationship management or CRM, is yet another one of those popular three letter programs that have been implemented by most large corporations over the last decade that has failed to live up to its expectations.

The definition of CRM for banks

It is important that the client not the product is in the center. The CRM definition we use is the following, ‘having the right offer for the right client, at the right time via the right channel’.

CRM is much more than a technological solution. It is a strategy integrated in the business model of the banks and clearly oriented to value generation

CRM is about enterprises collaborating across the customer value chain to develop and implement solutions that better meet the evolving preferences of individual customer groups. The C in CRM therefore has now evolved from ‘Customer’ to “Collaborative”.

The importance of CRM for banks

Customer relationship management is a broad approach for creating, maintaining and expanding customer relationships

CRM is the business strategy that aims to understand, anticipate, manage and personalize the needs of an organization’s current and potential customers.

At the heart of a perfect strategy is the creation of mutual value for all parties involved in the business process.

It is about creating a sustainable competitive advantage by being the best at understanding, communicating, and delivering and developing existing customer relationships in addition to creating and keeping new customers

So the concept of product life cycle is giving way to the concept of customer life cycle focusing on the development of products and services that anticipate the future need of the existing customers and creating additional services that extend existing customer relationships beyond transactions.

What is CRM supposed to do?

The theory behind CRM is that if companies take a systematic approach to building relationships with important customers, this will result in greater levels of customer satisfaction, increased revenue from those customers, and greater loyalty.

CRM is based on faulty assumptions

Faulty assumption # 1: Building a relationship requires a ystematic process and management system.

Faulty assumption # 1

Anyone who has ever had a job in sales knows that you can’t take to same approach to sales as you can with engineering a product or landing a plane. You can follow the exact same series of behaviors with one prospect, and she does not buy a thing.

Building a relationship requires a systematic process and management system.

Faulty assumption # 2

Most CRM data bases include all sorts of information about accounts and individual customers. There is information in there about the org. structure and who has the real authority, decision making matrices, and personal information about customers such as their previous jobs, buying history, spouse’s names, kid’s ages and names, hobbies, interests, golf scores, favorite vacation spots, etc.

CRM software provides the data needed to improve your ability to build relationships with customers

Faulty assumption # 3:

a lot of friends and clients in sales jobs: pharmaceuticals, insurance, financial services, medical devices, copiers, and a host of other products and services. One thing you hear from all of them is that they hate their company’s stupid CRM systems. It’s common for salespeople to spend 2-4 hours a day with their lap top, typing in reports of conversations with customers and prospects, entering data, and preparing account status reports.

It will be easy for the salespeople to use the CRM software and they will love it when they see how it helps them sell more.

How to Measure CRM Success

1- Input metrics

measures of quality, accuracy, thoroughness, and the degree to which data are current and verifiable

2- Process metrics

measures of behavior or activity proven to link to good performance

3- Output metrics

Quantifiable things that can be counted such as orders, samples distributed, proposals submitted, new clients acquired, brochures sent, phone calls made, meetings held, accounts visited, demos conducted, etc.

4- Outcome metrics

gross margin dollars, sales revenue, reduced marketing costs, artnerships with important customers.

What benefits can banks hope to achieve through deploying CRM solutions?

It depends on the positioning and focus of a bank. If operational excellence is your key-focus and not customer intimacy, the choices you make in terms of investments in CRM will be completely different. In strategic terms, ABN AMRO has a strong ambition to create value for our clients (especially the "midmarket" which we define as mass-affluent/ private client consumers and mid-sized businesses) by offering high-quality financial solutions that best meet their current needs and long-term goals.

Present and Future of CRM in banking

Bank merely an organization it accepts deposits and lends money to the needy persons, but banking is the process associated with the activities of banks. It includes issuance of cheque and cards, monthly statements, timely announcement of new services, helping the customers to avail online and mobile banking etc. Huge growth of customer relationship management is predicted in the banking sector over the next few years.

Steps to follow

- Identification of proper CRM initiatives

Steps to follow

- Implementing adequate technologies in order to assist CRM initiative

Steps to follow

- Setting standards (targets) for each initiative and each person involved in that circle

Steps to follow

- Setting standards (targets) for each initiative and each person involved in that circle

- Evaluating actual performance with the standard or benchmark

Steps to follow

- Identification of proper CRM initiatives.

- Implementing adequate technologies in order to assist CRM initiative.

- Setting standards (targets) for each initiative and each person involved in that circle.

- Evaluating actual performance with the standard or benchmark.

- Taking corrective actions to improve deviations, if any.

Conclusion

Customers are the backbone of any kind of business activities, maintaining relationship with them yield better result

Conclusion

Working with Luxoft helped the client to understand the issues of the current system and to improve the business process flow within the bank.

Conclusion

As a result of the implementation of the new CRM system, the time taken for data entry within the bank has been significantly reduced.

Conclusion

As a result of the implementation of the new CRM system, the time taken for data entry within the bank has been significantly reduced.

The new CRM system provides a single point of access to corporate clients’ data to all the parties and brought together sales, global relationship managers and senior investment bankers across the client organization.

The effect of CRM

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