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Customer Relationship Management Systems In Banks Information Technology Essay

The high rates of deployment of digital technological solutions have contributed to major changes in market research.
The advancement in information technology has made mangers to look for new ways of doing market research and consequently enhance them with awareness of their current market both in terms of opportunities and problems.
The knowledge about their customers is one of the greatest assets of the banks. They can use this precious asset and use it as a key competitive advantage for retaining those set of customers who characterize the highest profitability and lifetime value. Banks can improve customer relationships across a broad range of touch points like at bank branches, ATMs, electronic banking, internet, kiosks, and call centers. CRM is a dominant management tool that can be used to enhance the sales potential and further increase the value of the customer for the bank. In general, CRM incorporates various components of a bank's business for example, sales, marketing, IT and accounting. This approach may not increase a bank's profit suddenly, but it will definitely boost customer loyalty to the bank. The fundamental objective of contemporary CRM methodology is to aid businesses in using human resources and technology to gain a better understanding of customer behavior. For instance, banks may keep tab on a customer's life stages for marketing appropriate banking products, like home loans, credit cards, etc. to their customers at the correct time.

Technologies changes enable companies to re-strategize their plans, which allow them to have more information about their customers and their needs and requirements [1].

The collection and processing information from the client and providing an atmosphere of assurance and trust is imperative to customers’ retention.

Keeping long-term relationships has a substantial effect on business success and this can be more enhanced by increasing the effectiveness of existing client relations [2].
Customer Relationship Management (CRM) has been recognized since the mid 1990's, mainly due to the fact that many industries were experiencing increased demand from their customers for higher quality and less fuzzy access to service. This emphasis on renewed customer services drove corporations and the top managers to rethink the more effective way of providing services. (Smith, 2006, p.87)Generally speaking, there is no clear definition of a successful CRM. A successful CRM implementation is one that meets the business objectives. These objectives can be customer acquisition, customer retention, customer satisfaction, customer loyalty, better customer service or any other objectives that are set by the organisation.

It was estimated that the cost of winning a new customer is five times higher than that of maintaining an existing customer [3]. While the retention of an additional 5% of customers can increase profit by almost 100%.
Today banks are market driven and market responsive and every bank's CEO is more concerned about how to increase or at least maintain the market share in every line of business against the backdrop of sharp competition. Additionally, the entries of multiple channels and new players have made customers (both corporate and retail) more perceptive and less loyal to banks. This makes it essential that banks offer potential products and services to ensure customer delight. There have been vigorous efforts in the banking circles to switch over to customer-centric business model in order to address the challenge of retention of customers. The approach adopted by banks with respect to customer relationship management and customer data management decides the success of such a model.

Hence, the need to keep effective and long term relationship with customers is necessary and requires a system that encourages keeping such relationships.

Customer Relationship Management Systems

The term customer relationship management (CRM) system is defined as storage of customer information which encompasses all the customers’ profiles. Apart from the conventional database functions, it also plays the role of personalizing the needs of every customer by differentiating products and services of each distinctive customer [4].

There are probably five different answerers, when five different companies were asked about their views on Customer Relationship Management. CRM is not just a single application that will solve all customer related problems in an organization. Rather, CRM is almost a “state of mind” within an organization in which three key functional areas of the organization are integrated. These areas are sales, marketing and customer service.

CRM systems helps businesses to gain new customers; retain the existing customers and keep good relationship with customers as well as promoting customers’ values; hence improving the organization images [5].
Not at least of this the banks are confronted with a considerably stress of competition. Therefore many banks use systems and concepts to improve and to handle the costumer contacts. In the following of this paper the Customer Relationship Management will be showed and analyzed.

With increasing competition for marketing dominance, many organizations have exploited the customer relationship management (CRM) system to enhance business intelligence, better decision making and improve customer relations to offer quality services and products [6].

According to Buttle (2001), a CRM system is a technology-based business management tool for developing and leveraging customer knowledge to nurture, maintain, and strengthen profitable relationships with customers [7, 8].

CRM systems offer the framework that expedites building long term relationship with customers.

It also reduces duplication in data entry and maintenance by enabling a centralized firm-wide database of customer information.
Besides the price sensitivity and the interest sensitivity of the customers were obviously increased and the customers´ willingness for changing the bank became higher. As a result a trend towards a hard cutthroat competition is identifiable. This evolution is enforced by using of new and innovative concepts. The value chain of the classic banks, which so far includes product development, transaction banking, and retail banking, breaks increasingly open and so specialization is necessary. The majority of the banks will focus on the retail banking in the future.

It is a database which replaces the individual sales person and prevents the loss of organizational customer knowledge when that sales person leaves the enterprise [9]. CRM goes beyond information technology solution for collecting customers’ information; it is a form of universal concept where firms gain competitive advantage through by having more knowledge about customers understanding and relationships [10].
The consequences are an increasing pressure of competition and demanding customer. Therefore a binding and long-term customer relationship seems to be necessary for many banks to react to the changed conditions and to guarantee the continuity. A majority of German credit institutions tried to implement concepts of Customer Relationship Management (CRM). In some cases the afford - to turn the customer relationship into the road to success - were unsatisfying and unsuccessful.

Customer relationship management systems in banks

Financial service firms are the earliest implementers of customer relationship management systems. Before the implementation of CRM systems within the financial industry, banks and insurance firms had developed close relationships with their customers through personal customized services which were mainly a costly, inefficient and time consuming process [11].

According to the changing of the general conditions the German banks are forced to break new ground in order to assert their position: The market became much more lucent for customer because of new media.

But with CRM systems and information and communication technology (ICT), organizations can provide large customer variety, lower price and customized service all at the same time [12]. The banking sector compared to most other industries has richer customer databases comprising of transaction files, balance positions and call centre records.
The traditional customer contact is still the counter (Point of Purchase), at which all businesses can be transacted. Such customer contacts could also take place by home visits (Direct Sales). The loosing of the direct contact was introduced by telephone banking, which gives the customers the possibility to transact the business via Call Centre or via Electronic Mail at home.

According to Kalakota and Whinston (1997), banks are no longer "gatekeepers" but "gateways" to financial products. In the old gatekeepers’ model, banks act as an agent which limits themselves to customer related product choices.
According to this evolution new distribution channels become more important. The key word is Multi-Channel-Distribution. For instance the internet allows the banks to reach a bigger customer group with lower deployment by using Multi-Channel-Distribution. This concept helps to offer custom-tailored products by the suitable distribution channel. As the figure 1 shows the banks use multitude of different channels of customer contacts.

In the gateway model, banks acts as a flexible agent with wide variety of products like entertainment, insurance and investment, thereby providing more spectrum and flexibility [12].

Chapter One


Here in this chapter, the introduction, research question, research purpose, problem statement and delimitation of the research are highlighted

Chapter Two

Research Design

In chapter two, the method of conducting research is explained.

This chapter helps the reader to ascertain the research method, approach and standpoint the researcher used to carry her research.
The purpose of this research is to find out the relationship between CRM, customer satisfaction and customer loyalty in the banking industry of Singapore. Also, understanding the customer's expectation and satisfaction level is other primary aim of conducting the research.This research is expected to give some contribution to the bank managers who are a part of Customer services and relationship management area in the banking and financial industry of Singapore.

Chapter Three

Literature Review

The chapter comprises of literature review. Literature review is conducted from several sources of databases available through the university’s library.

Chapter Four

Case study and

Bank Background

In this chapter, information about the history of the bank selected for this research is described.

This chapter also describes information on customer management in Nigerian banking industry.
But interconnectivity of all the three variables have never been studied before. Many authors have claimed that Customer Relationship Management (CRM) has evolved from the concept of Relationship Marketing. CRM as a customer's approach has been gaining importance in every industry of the world; especially in the service industries. Therefore, after considering all the theoretical and practical concepts and implications, an attempt has been made to inter-connectively study the concepts of CRM, Customer Satisfaction and Customer Loyalty prevailing in the Singapore Banking Industry.

Chapter Five

Findings and


This section describes the research findings and the analysis. The analysis is performed with both primary and secondary data.

Chapter Six

Conclusion and


This section provides the conclusion of the research by giving answer to the research question.

It encloses the result of the study which is collected with the help of analysis carried out.
This chapter critically explores into the concepts of CRM and its three variables, Customer Satisfaction and Customer Loyalty. Work of various authors on the subject has been studied with reference to the context of present research. The flow of the chapter continues with understanding the relationship between Customer satisfaction and Customer loyalty done by previous researchers which will be valuable in answering the research questions set for this research. A detailed investigation on the Customer satisfaction and loyalty, and current practices undertaken by various banking industry in different countries of the world is highlighted in this chapter. Lastly the chapter ends with the research framework created as the interconnections that have emerged as a result of the study of these variables.

Recommendations for organizations that adopt CRM system are also provided

Table 1: Thesis outline

1.3 Problem statement

Customer relationship management (CRM) system has been ascertained to have better relationships with customers by having detailed knowledge of their requirements with the help of various information technologies. Implementation of CRM systems appropriately will bring tremendous benefits to both the customers and the business respectively.

CRM solutions can significantly help in improving customer satisfaction levels if implemented and integrated correctly. Data warehousing can help in delivering better transaction experiences for customers using different transaction channels. The reason is that data warehousing helps bring all the transactions coming from different channels under the same roof. Data mining provides banks measure and analyses customer transaction behavior and pattern to improve service levels and find new business opportunities.

Banks have large number of customers and for the banks to meet up with their customers’ requirements; most of the banks have embraced CRM system. This research work tries to ascertain the benefits of CRM systems to the banking industry.
Previously, many researchers have conducted research on topics such as CRM, Customer Satisfaction and Customer Loyalty as an individual variable on various banking industries like Australia, Korea, Russia, Canada, Malaysia, India, Costa Rica, Greek, Hong Kong, Kuwait, Nigeria, Taiwan, and UAE and so on.

1.4 Research question

The thesis will be written in accordance with the formulated research question. What benefits can be derived from implementing CRMS systems in the banking industry?

1.5 Research Purpose

The main reason of this research is to describe and analyze the benefits of implementing customer relationship management systems in the banking industry in a developing economy such as Nigeria. The strategy will be finding out both customer and businesses benefits, and thus compare the benefits with empirical data obtained from banking sector.

According to Roy (2008,p.56.), along with providing good product attributes, acquiring new customers and transforming them into loyal customers through customer satisfaction has now become the main strategy of the global banking industry. The base of a successful business growth strategy for a bank is to ensure a good customer experience at each and every customer touch point. Here lies the importance of Customer Relationship Management.

1.6 Delimitation

This research is limited to only one bank as it is hard for the researcher to find other contacts in banks both inside and outside of Sweden. In this research, I concentrated more on benefits with successful implementation being considered essential to accomplish benefits.

In present times, as the customers enjoy a good amount of power in terms of customization of products and services, the banks can use CRM practices to nurture long-term, mutually-beneficial relationships. For a bank to prosper by adopting a CRM strategy of doing business, it first has to first understand CRM as a all-inclusive concept that includes multiple, interconnected disciplines, such as strategic planning, market knowledge, product design, business process improvement and pricing analysis, modern technology implementation, customer retention, human resources management and sales force management and training.

This study contains the benefit which Zenith Bank got with the implementation of CRM system and it is not necessary that other banks or financial organizations got same benefits from CRM system. Research is conducted in a single bank which can be considered as limitation of the research.
Based on the research and the opinion formed and observations made by the researcher, over the conduct of this research, certain conclusions have been arrived which has been written in this chapter. The limitation of the research work has also been discussed in this chapter.

Chapter Two: Research Design

2.0 Methodological Analysis: Realistic

The methodological analysis employed in this research work is related to the realist approach. The realist researcher gazes for relationships between variables and where possible tries to establish chains of cause and effect.

The banks are continuously developing, re-designing and delivering the finest possible products and services which will strengthen the relationship between them and their customers. The global banking industry has effectively started applying CRM strategy in a competitively market through many Customer- oriented and loyalty programs which can enhance the flow of information between the bank and its customer thereby increasing satisfaction and gaining customer loyalty.

The research of this nature involves structuring a problem by splitting it into its various parts. The connection among the parts would then be analyzed, by looking for repeated patterns and associations [13].
Each questionnaire was individually analysed in respect of the main points and issues sought to be highlighted and discussed. Care has been taken to structure the analysis on a uniform pattern so that the findings could later be used to draw further conclusions and recommendations for the research.

As noted by Fisher [13], the realist research divides the problem into various parts and then the relationship between the problems would then be collated and studied. I will embrace a similar approach as I am intending to collate and analyze the benefits of CRM systems in the banking industry.
For service provider, especially in the banking industry, great benefit can be obtained from this research that can be applied for getting a better service quality in order to make more market share in the industry. Also with the research conducted, the service providers can get information on current customer's expectations from the banks and the feedbacks which can help in improvement in the product/ service quality of the banks.

The research problem will be divided into component portions to be able to ascertain the benefits of implementation of CRM system both to the business and the customers. To establish the cause and effect chain, I will examine cause of implementing CRM systems and on the effect side the benefits which successful CRM system offers.
In the first chapter I describe the current situation of German banks. After a brief overview about CRM in general we analyze the previous attempts of CRM implementation. Two examples - Dresdner Bank and Deutsche Leasing, a member of the “Sparkassen - Finanzgruppe” - follow. At the end I identify the problems of the implementation of CRM at the banks.



Customer & Business


Successful CRM implementation

Figure 2.1: Cause and Effect Relationship Diagram

2.1 Research approach: Deductive

In this research, I considered two research approaches namely structured and grounded approach. Fisher (2007) stated that in a structured approach a structure is imposed on the research based on a preliminary theory, concept or hypothesis.

This chapter has been structured in a way as to answer the research questions. All three questions listed earlier in this introduction have been answered in the chapter. Additional observations, not falling with the preview of the original question sought to be answered, has also been discussed in this chapter.

So, the structure may be employed to guide the research and also material collating process. Whereas, a grounded approach allows material to collated without prejudice or preliminary conceptual thoughts about what is going to be ascertained.
This is the concluding chapter of the dissertation, providing some recommendations and remarks of the overall findings and a brief comment on the outcome of the research. References have been listed after this chapter, listed in alphabetical order and under appropriate heads.

Fisher (2007) further stated that the use of structured approach ensures the security of understanding the structure and shape of the research before the collation of the research material.

In this research I employed structured approach for collating research material.

The approach of CRM as a philosophy is used in this research to understand and analyze the customer oriented culture of Banks in Singapore.

This employs collecting of data from various articles, exploiting literature review of the material collated from various articles and build up the conceptual frame work.

Fishers (2007) noted that there are two types of discoverers "Explorers" and "Surveyors". Explorers travel into an unknown destination and their major focus is making the unknown into known.

The methodology adopted for the research has been discussed in this chapter. The research follows both quantitative as well as qualitative methodology in the form of survey questionnaire and observation respectively. The reason for use of the above methods along with other information has been discussed in this chapter.

Based on the fact that they do not have clue of what they will arrive at they embrace the open approach; whereas, the surveyor task is to pin the knowledge down into precise manner. Surveyors have ideas about what they will find out and they will measure things.
However, the study conducted by Ndubisi, et al (2009) has been focussed primarily. The research framework and the variables of Relationship Marketing have been studied and applied in the research to achieve the aim and objectives of the research.

Surveyors always embrace the close approach [13]. In this research work I will use survey approach. I think using Survey approach is mandatory since answering research question requires using both secondary and empirical data.
The research will focus on various theoretical concepts like CRM, CS and CL. Also, with the help of many journals and case studies, the practical implications of these concepts in the various banking industries across the globe have been studied and concluded.

2.2 Research method: Qualitative

Fisher (2007) noted that any method, either Qualitative or Quantitative can be used in a research and it is erroneous that realist research means using quantitative research method. In accordance to Fisher postulation (Fisher 2007), in this thesis I am adopting realist research that embraces using qualitative research method.

This research theoretically introduces the concepts of CRM, Customer Satisfaction and Customer Loyalty. Also, Theories related to service quality and consumer behavior are a part of this research. The theoretical concepts can help the reader to understand the nature and requirements of these variables in the service industry.

2.3 Data Collection

In this thesis work, both secondary and primary data are collated.

2.3.1 Primary data

In this research, the primary data are collated using questionnaire. Fisher (2007) noted that there are two types of questionnaires; "Precoded" and "Open". Precoded embraces using tick boxes to be fill in and Open questionnaire allows free space which enables respondents to give responses in their own words.

The sample of mere 100 respondents may not accurately represent all the banking customers of Singapore.

The use of questionnaire in this research work is separated into three sections, which is to collate response from the Zenith Bank on its implementation of CRM system and the customer and business benefits they derived from it. In this research work, I use some open questions for the respondent to answer.
The result from this research can be used as additional information and contributions to service providers in banking industry in the form of service quality consideration and can help to understand the consumer behavior and help to reach the benchmarks of the service quality in the banking industry.

Every answer from respondent has been collated by sending open ended questionnaire.

2.3.2 Secondary data

Secondary data is a type of data that is gathered from other researchers work. Secondary data is often gathered from articles, books and journals.

I intend to collect and analyse both primary and secondary data in the proposed study. The secondary data will take the form of a literature review and provide details of past studies into customer relationship management in Banking sector. From the literature a set of criteria for bank selection can be deduced. This can then be used in the primary data collection. Saunders, Lewis and Thornhill (2007) describe descriptive research as portraying an accurate profile of persons, events or situations. The study will follow the survey strategy because it allows the collection of large amounts of data from a large population. Saunders, Lewis and Thornhill (2007) contend that questionnaires work best with standardised questions. As the bank selection criteria will be drawn from past studies this enables the questionnaire to be set out in a standardised way. A Likert will be used allowing respondents to rate the importance of different criteria. This means the results can be analysed by a quantitative data package (SPSS).

In this work I use online databases available through LNU digital library. Databases used in this research work are listed in tabular form as follows:


Obtained from


Diva(Digital Vetenskapliga)

Google Scholar


Science Direct

Table 2.1: Database table

I obtained different articles and journals by typing likely keywords about my research in above mentioned online databases.

In order to have good quality coverage and representative sample, 250 bank customers from different banks having different age group, gender, educational background and occupation were taken from different parts of Singapore. The data have been collected from the structured questionnaires which were filled by the respondents at the time of survey. Also the observation technique was used by the researcher as a potential customer to understand the current practices adopted by various banks to retain and satisfy the customers.

I then selected close related topics to the benefits of using CRM system and information on CRM systems implementation. The various keywords I used during my literature research are:

CRM system

CRM benefits

CRM customer benefits

CRM business benefits

CRM successful implementation

2.4 Validity and reliability of the research

For validity and reliability of this work, I tried to choose articles from peer reviewed journals. Mostly the articles are collected from the university (LNU) online libraries.

People involvement at all stages is indispensable for the success of a CRM program. The bank's managers and other staff must be in a position to exploit the customer relationship completely.

The empirical data were collected from the responsible and authorized persons from Zenith bank.

2.5 Method Critique

In this thesis work, I employed both secondary and primary method to collate data. For collating primary data, I selected only one bank in Nigeria.

To complete the primary data collection all possible selected bank customers will be approached. They will be approached through e-mails and on-line networking sites (e.g. Facebook). Every reputed bank in India have minimum 1,18,952 registered accounts according to the latest figures available on-line . To take part in the study, Customer will be required to complete an on-line survey lasting no more than 5 minutes. Respondents will have to access to the internet and have at least 1 current account. As all customers are computer literate, with internet access provided by the bank, and should all have a bank account, the sample size is the number of customers at the bank. Due to time limitations non-probability sampling will be used with self selection.

My choice of one bank limitation is because it is challenging to have contacts with banks both in Nigeria and Sweden. The limitation of contacts can hamper the amount of data collated in this work. In addition, only the head of CRM system in Zenith Bank answered the questionnaires, which can limit the research as information is provided only in one viewpoint which is pro CRM system.
The self completion question is selected because it is both cheaper and faster to administer and can be completed at the convenience of the respondent (Bryman and Bell, 2003). However, there are a number of issues listed by Bryman and Bell (2003) concerning self selection questionnaires. Firstly, self selection questionnaire have a lower response rate, this can be improved through writing a good covering e-mail, and the subsequent sending of follow up e-mails. Secondly, the researcher cannot prompt or probe the respondents. However, by piloting the questionnaire prior to administering, this should help ensure the depth and relevance of the questions. Finally, the questionnaire can be read as a whole and as such there is a greater risk of missing data because respondents can select which questions they wish to answer. However with the questionnaire being administered on-line, questions can be marked as requiring a response, thus limiting respondent progress until said questions are completed. Also, the questionnaire can be set so respondents can only see one question at a time.

Chapter Three: Literature Review

3.0 CRM system implementation

CRM system implementation requires looking beyond customers perception since it entails focusing on wider perspective. CRM system implementation entails data collation which is as important as integration of processes.

However, it must be noted that customer-centric banking comes with many risks. The banking industry all over the world is being pushed into a wild new world of privacy controversy. The banks need to set up serious governance systems for management of privacy risk. It must be kept in mind that customer privacy issues threaten to compromise the use of information technology which is at the heart of e-commerce and CRM - Two areas which are crucial for banks' future. The important issue for banks is that without undermining the most thrilling innovations in banking banks will not be able to preserve customer privacy completely. These innovations promise huge remuneration, both for customers and providers. But to get benefited from them, financial services companies and their customers will have to make some critical tradeoffs.

Thus, it implies that technology and processes are the fundamental factors of CRM systems [14].

Technology Infrastructure:

Broadbent & Weill (1998) states that " Technology infrastructure is a key requirement of CRM and in creating any IT infrastructure around business-driven requirements must be based on a sound understanding of a firm’s strategic perspective"[15]. The level of investment in IT and system associated to CRM is imperative to realize and with the drive towards e-commerce making long term infrastructure investment decisions critical [15].

Time involved in processing should be minimum with least waiting time to the customers. If required delegation of authority and assignment of account-ability at various executive levels should be addressed, revised and fine-tuned to meet the requirements.

Firms must apply integrated approach instead of employing technology in different ways for successful implementation of CRM systems [14].

Front end technology:

Front end information systems such as sales force automation (SFA) and customer service automation enables enterprises to serve and engage their customers by embracing information system based tools. Most firms incline for more interaction with their clients employing such forms of technologies [14].

In recent years, a rapid revolution is transforming the banking industry around the world. In early 1990s, banks and other financial intermediaries have been affected by greater risk and sharp competition due the wave of deregulation in India. Due to cross-border flows and entry of new players and products, banks are forced to adjust the product-mix and modify their processes and operations to remain competitive. Also, better tracking and fulfillment of commitments, multiple delivery channels for customers and faster resolution of incoordination is possible due to extensive use of technology.

Data Gathering:

Data gathering encompasses obtaining the knowledge and information about customer’s requirements and preferences. Data can comprise customers’ name/address, customer status, customers’ buying habit and other information.

The banks use various methods through which customers' information can be gathered and decide where and how this data will be stored and how will it be used. For example, the banks may contact customers through mails, emails, call centers, marketing and advertising. The data thus collected may flow between different operational systems as well as analytical systems which can sort these records to identify to identify any underlying patterns. Business specialists can analyze this data to attain an in-depth understanding of each customer and ascertain areas where improvement in services is required.

The use of technology to capture data is faster and time efficient compared to paper based data collection technique. The use of technology facilitates direct communication and interaction of channels to gather data.
Competition in the banking industry has increased in recent years, due to events such as technological changes and deregulation in the industry. Conventional banking channel has been progressively supplemented by the growing use of electronic banking. A lot of bank customers now prefer using ATMs or Internet banking rather than visiting a branch. The technological advancements have also reduced barriers to entry for a large population of new customers.

Technology also allows data saving in such a way that it may be deployed across several channels and can also be deployed for strategic purpose [14]. According to Algesheimer et al (2001), "customers’ processes do not fit into traditional functional organizations so the process flexibility and data integration are most important issues while implementing CRM systems" [16]. But, the systems should be updated with the varying dynamics of the market and customers.
CRM life cycle begins with the integration of front office systems and the centralization of the customer- related data. The benefits of this phase include improved front office efficiency and productivity. In this phase, the customer data has to be collected in detail and maintained properly. Customer profile regarding demographics, socio-economic and lifestyle characteristics of customers has to be colleted. Based on collected data, analysis of customer begins to understand behavior, identify the pattern of buying and trends, and discover causal relationship. The out of this is strategic business decision. Business processes and organizational structures are refined based on the improved customer understanding gained through analysis.

Enterprises that embraced strategic approach in implementation of CRM systems were successful for several reasons. First, they mapped out a business strategy which fits into their business needs, while the business needs determine the functionalities that are deployed and developed.

CRM is variously misunderstood as an expensive software product, a fancy sales strategy, or even a new method of data collection. However, CRM in the Indian banking system is fundamental to building a customer-centric organization as it links customer data into a logical and single customer repository. It is a key element that allows a bank to develop its customer base and sales capacity. The objective of CRM is to manage all aspects of customer interactions in a way that enables banks to maximize profitability from every customer. Increasing competition, deregulation, and the internet have all contributed to the increase in customer power. Customers, faced with an increasing array of banking services and products, are expecting more from banks in terms of attractive returns, customized offerings, transparency in dealings and ease of access. Major concern for banking institutions is retaining customers which underscore the importance of CRM. Banks can turn customer relationship into a key competitive advantage through strategic development across a broad spectrum.

Secondly, they developed strategic approach during the implementation of CRM system. This then provides the facility to define the scope of the project and consequently controls which of the CRM elements are included in the project and which are not.
Use of modern technology is imperative in the operations of a complex and data intensive business such as banking. At the same time it should increase the user-friendliness, facilitate smooth flow of information, flexible and easy implementation of new processes. Banks should use technology to remove the human error from the various processes as far as possible.

The planning for the scope of the CRM project entails thorough scrutiny of use for sales-force automation, employee relationship management, call center routing, point of sale systems, wireless application, marketing campaign automation and Web self-service [17].
Different CRM definitions can be found in the current global world. Pedron and Saccol(2009) concludes CRM as a philosophical approach where a firm operates its working by thinking and functioning from a customer oriented point of view at every point of interaction between them and the customer to build and develop long term relationships. Whereas, KinCaid (2003,) is of the opinion that CRM is the planned and strategic use of combination of technology, information, processes and people to handle and manage the relationships with customers across the whole customer life cycle. On the other hand, Peppers and Rogers (2004) believe that CRM is a technological approach which helps to generate and broadcast the ideas in the form of software applications to enable better customer services.

Thirdly, the scope determines the needed cross departmental infrastructural modifications which are needed in building vibrant cross- functional CRM teams that effects organizational changes among various section of the business formation.
As a result of wide variety of choices available to customers today the customers have the power to decide which bank they want to maintain relationship with. Therefore, protecting the existing customer base, as well as drawing new ones, is a serious concern for banks. Customer satisfaction is a vital variable in appraisal and control in a bank's marketing management. Low customer satisfaction leads to a decline in a customer loyalty, and given the comprehensive list of offerings from the rivals, customers can easily switch their banks. Banks should essentially leverage on their customer relationships and judiciously use the customer information across the organization.

In summary, vibrant design of CRM strategy, scope determination and development of cross functional teams enhance good CRM system implementation [17].

Kotorov (2003) noted that both process and system integration concurrently are required for successful CRM systems implementation, but also challenging to achieve both together.

CRM is a simple philosophy that places the customer at the heart of a business organization's activities, processes and culture to improve his satisfaction of service and, in turn, maximize the profits for the organization. A successful CRM strategy aims at understanding the needs of the customer and integrating them with the organization's strategy, people, and technology and business process. Therefore, one of the best ways of launching a CRM initiative is to start with what the organization is doing now and working out what should be done to improve its interface with its customers.

Enterprises that do not embrace strategic approach only employed partial integration that leads to incomplete customer view, confusing customer service and poor targeting

Employee’s change is an essential measure of implementation of CRM system since employees are closely related to CRM processes, and their exploits in turn impact the success of CRM projects [18].

CRM is a corporate level strategy, focusing on creating and maintaining relationships with customers. An effective CRM system is able to identify factors important to clients, promote a customer oriented philosophy, adopt customer based measures, develop end-to-end processes to serve customers, provide successful customer support, handle customer complaints, track all aspects of sales, create a "holistic" view of customers' sales and service information. The long-term success of an organization depends mainly on how well it attracts and retains a large customer base. Managing relationships with customers is very important for organizations since improved relationships increase business value. CRM helps in leveraging information regarding customer behaviour to achieve high levels of customer satisfaction, retention, and loyalty all resulting in improved profitability.

The success of a large-scale change initiative as presented by a CRM implementation depends heavily on possibility of employees who are subscribed to change [19]. Employees’ commitment to change is one of the important factors for successful CRM implementation.
Even though CRM can aid the banks to efficiently manage their customers, several banks remain unsuccessful in merging this concept into the existing work culture. However, the high frequency of CRM failure is not directly related to the CRM concept itself. Generally it's as a result of the banks' failure to pay due consideration to customer data they already have access to.

Firms must create an atmosphere where employees exhibit less resistance during the implementation of CRM systems [20]. Corporation must be aware of some strategies before implementing CRM systems [21], these strategies are:


The first strategy is identifying the target customers which organization offers services to. Enterprises may employ existing business’ model in identifying target customers.

In the highly competitive market, all the banks are faced with the challenges of attracting new customers and retaining the existing customers. Maintaining relationships with the existing customers is considered even more important than attracting new customers. One of the reasons supporting this argument is that the cost of attracting new customer is much higher than the cost of retaining the existing one. Thus, Customer satisfaction and loyalty are essential to a bank's success in the Singapore banking industry which can be achieved by undertaking effective CRM strategies.

Such approach helps categorizing customers according to their brands. Hence, customer centric strategy enables firms to be more profitable through increase focus on customers, sales and market share [22].
With the estimated growth of Average Real GDP to 4.4% over the next five years, Singapore's banking loan growth is expected to pick up the pace to 9% in 2010, after an estimate increase of just 4% in 2009(Business Monitor International Ltd, 2010, p.28). Also, a rise in other products and services like credit cards, deposits, mutual funds, investments and securities are anticipated to grow in the near future. This indicates the continued commercial banking stability in the coming future. There is an intense competition among all the banks in the industry. With the expected increase in loan growth rate along with other product and services, it can be predicted that the banks will compete to the core in satisfying and retaining their customers to earn more profits.


Ramsey (2003) noted that enterprises must assess the proper and prospective channels available to them, more so it is particularly imperative that they rationalize and understand how to effectively use those channels they choose [21]. To recognize the conflicts while implementing the new channels is not the problem, but to create and improve the new strategies demands concentration and research [23].

In the long run the demand behaviour has changed: Since the fifties according to increased financial assets the demand for investment opportunities has increased. Through the movement of the demand the refinancing of credit transactions became more expensive.


It is imperatives for firms to have commitment to their brands. This implies that organization has must know their customer’s needs and preferences; must make improvement based on the feedback and train the employees about their brands and equip up businesses according to brands [24].

Throughout the last decade, banks all over the world have re-engineered their organizations to improve competence and moved customers to lower cost and automated channels, such as ATMs and online banking. As proved by the experience, banks now realize that one of their best assets to build lucrative customer relationships especially in a developing country like India is through branch. Branches are in fact key channels for customer retention and profitable growth in rural and semi-urban set up. However, Indian banks need to convert their branches from transaction processing centers into customer-centric service centers to maximize the value of this resource. This revolution would help banks achieve bottom line business benefits by retaining the most lucrative customers. Branches could also be used to educate and notify customers about other, more efficient channels, to advise on and sell new financial instruments such as consumer loans, insurance products, mutual fund products, etc.

In accordance to Ramsey (2003) submission, businesses employ brand value strategies to identify and know customers behaviors. He also noted that brand value strategy help to recognize that it can pay real dividends, increase revenues improve capital efficiency [23].
With the advancement in banking machinery and subsequent automation and networking of bank branches, customers are becoming more and dynamic and less loyal in their behavior. The development and easy accessibility of the Internet is acting as a catalyst and the whole market is becoming transparent and thus making customers efficient to move easily from one bank to another. In such a situation, by satisfying customer at all point of contacts will helps in retaining old customers and brings in new customers.

CRM applications choices

The application of CRM system helps businesses to achieve their vital goal, which is to attract new customers and hold on to loyalty of existing customers. CRM Systems implementation along with its capabilities helps bring substantial benefits for those investments [21].

For example, Georgia B & T of Augusta(File 59), uses both approaches of CRM as a technology and as a philosophy. The Bank uses technology approach by implementing Synapsys, a CRM application which helps the fast growing bank staff to execute customer relationship. On the other hand, as a philosophical approach, the bank avoids thinking of expansion of its relationships with a given customer as a sale and believes that it is better to see such transactions as an improvement in its own services to serve customers.

Piskar and Faganel (2009) said to gain competitive advantage through successful CRM system implementation, company’s management must understand industry’s practices; know how CRM fits into the context of the general business strategy of the organization and how to assess current CRM capabilities.
The Singapore government's decision to liberalize the banking sector, which was relatively sheltered from international competition before the financial crisis of 1997-98, has contributed to the country's growing role as a financial centre for the region and a destination of choice for global investors. Singapore's banking industry has shown an impressive growth over the past decade, ballooning to 114 banks (full, wholesale and offshore banks) in 2010 reflecting the high intensity of competition in the industry (Singapore Department of Statistics, 2010, p.191).

Others are to understand the reason why it is imperative to implement CRM, create and execute a plan; this is defined by how to achieve the goal and how to execute the plan [25].

3.1 Customer relationship management (CRM) system benefits

CRM systems emphasis on customers and they assist in identifying customers who are prepared to pay higher margin. If these customers are identified, their situation can easily be analyzed and also other varying attributes that help them in minimizing cost can be identified.

The concepts of Customer Satisfaction and Customer Loyalty written by Researhers like Lin, et al(2009); Neilson & chadha(2008) ; Wugayan & Pleshko(2010); Tariq & Moussaoui(2009) ; Ehigie(2006); Roig, et al(2009) ; Lin, et al(2009) ; Kassim & Souiden(2007) have been applied in the research.

This helps firms to have edge over their competitors whenever they are negotiating with customers since customers are very interested in saving cost. CRM system helps in knowing customers that are not paying "fair" margin [26]. For this purpose, an accounting based methodology known as activity based costing (ABC) is employed and this may be used as a part of CRM process.
Possible for firms to maintain a 1 to1 relationship with their customers. Firms can now manage every single contact with the customer from account management personnel, call centers, interactive voice response systems, on-line dial-up applications, and websites to build lasting relationships. These interactions can be used to glean information and insights about customer needs and their buying behaviour to design and develop services, which help create value for the customers as well as the firms. Although customised as well as off the shelf technological solutions are available in the marketplace, businesses need to do a lot more than just adopt these solutions to implement customer relationship management (CRM) practices. Successful implementation of CRM requires a strategic approach, which encompasses developing customer centric processes, selecting and implementing technology solutions, employee empowerment, customer information and knowledge generation capabilities to differentiate them, and the ability to learn from best practices.

In activity based costing the cost incurred in managing every customer is calculated with margin earned with each customer [26].

If customers’ demands are known, then CRM systems turn out to be a central aspect of business process and also enhance efficient usage of inventory.

Process with the ultimate objective of increasing loyalty of profitable customers. This is because of the applicability of the 80-20 rule. According to Market Line Associates, the top 20% of typical bank customers produce as much as 150% of overall profit, while the bottom 20% of customers drain about 50% from the bank's bottom line and the revenues from the rest just meeting their expenses.

This means, less manpower will be needed in the areas of customer support functions like customer service, credit entry, order entry, finance and collections. This is because customers will be demanding less for such services since they are better served with more reliable information, and consequently increases customer [26].
Customer Relationship Management (CRM), which is the most appealing strategies that has been developed from networking technology revolution of the 1990's, is now emerging as one of the most important cooperate business strategy. A well-implemented Customer Relationship Strategies can result in numerous quantitative benefits, which include a better ability to up sell and cross sell, increased customer retention in addition to a lower cost of services.

CRM systems improves every customer related transactions from the first contact to the on-going services, repeating sales and in turn getting value from each step. If these steps are performed and managed properly by the organization then it implies that customer related information and their attributes are gathered in an efficient way.

Customer Relationship Management is basically the process of developing, establishing, maintaining and optimizing long-term and mutually valuable relationships between customers and the companies. Successful CRM practices focus on understanding the needs and wants of the customers and success is accomplished by placing all these needs at the very heart of the business by incorporating them with the organization's strategy, technology, people and business processes.

Thus, providing good understanding of customers’ interests, requirements and plans. In addition, CRM systems enable evaluating the cost and return of investment in proving services to the customers. The implementation of CRM systems allows enterprises to recognize the products and services that yield profits from those that just liabilities [27].
Often driven by the need to improve customer satisfaction and retention, CRM systems can aid in understanding a customer or segment to focus sales and marketing activities. We will see more of an appreciation that profitability is a key variable in determining cross-sell promotions, product pricing and packaging based on historical as well as future anticipated consumer information. Lifetime value will be better understood to allow for organizations to think about potentially good prospects and the overall return on the relationship that is developed over time. CRM systems will be blended with operational and back- office systems to provide a seamless, real-time data environment. CRM will not only be about servicing the customer better, but also servicing the customer in the best interests of the customer as well as the business itself.

The implementation of CRM systems enables organization to embraces proactive approaches in terms of customer interactions. For example, if the sales unit came up with sales strategy, the post-sale unit develops the post-sale strategy of interacting with customers to fulfill their post-sale needs and demands.

CRM system can open up new more cost effective channels of service delivery. We can mention example of the Internet and call centers. According to an estimate, up to 90% reduction in cost per transaction is achieved by using these modes when compared to cost of transaction at branch. In order to give enhanced and extensive services to customers new technology platforms are being created by shelling out huge investment in Information Technology in this sector. With the recent development in this field by introducing CBS (Core Banking Solutions) banks can offer seamless transactions across different channels (branches, the Internet, the telephone and Automated Teller Machines or ATMs). CBS helps in centralizing the transactions of branches and different banking channels and the customers start banking with the bank instead of at different branches. As such nowadays a customer is called a customer of the bank rather than of a branch.

With CRM systems, organizations can maintain and record the customer information such as objectives, desires and events. Thereafter, the information is updated into the CRM systems to ensure that the customer’s information is not outdated.
There should be proper re-action to the information and feedback provided by the customers in designing, developing and providing desired products at afford-able cost.

Customer interactions allow new business opportunities due to availability of more information about customer’s goals and requirements. This also encourages more customers to the enterprise for additional products and services, or to renew their contracts, thereby providing publicity about the organization to the others.

One more objective of CRM is the efforts towards constant improvement in the customer relationship by providing value added services at reasonable cost. An effective way of bringing improvements is through innovation and change management. The successful organizations must encourage and foster innovation and perfect the art of change. Organizations that maintain their spontaneity, flexibility and unpredictability, repeatedly improve their quality and, beat their competitors in the market place by continuously innovative new products and services.

Because of this kind of interactions, information is constantly expanding in the CRM systems and hence increases the profile portfolio of each customer and ultimately works as powerful tool in making business decisions [27].
Since long, Indian banks had presumed that their operations were customer-centric, simply because they had customers. These banks ruled the roost, protected by regulations that did not allow free entry into the sector. And when the banking sector was opened up to their credit they survived by adapting quickly to the new rules of the game and many managed to post profits. For them an unexpected bonanza came from government bonds in which most were hugely invested.

The application of CRM systems assists enterprises to have good knowledge and relationship with their customers. It helps enterprises to have good market share, enhancing customers’ retention and satisfaction.

According to a RBI road-map, India has been a very competitive banking market after 2009. As one of the most attractive emerging market destinations, India had seen foreign banks come in, what with more freedom to come in, grow and acquire. Therefore, it is imperative that Indian banks wake up to this reality and re-focus on their core asset - the customer. A greater focus on CRM is the only way the banking industry can protect its market share and improve growth.

It also helps in enhancing profitability and revenue. CRM systems help in providing differentiated services or for value customers. The merging of customer information in single platform as applicable in CRM systems improves customer services [28].
Now-a-days, the success of any company is directly correlated to how its customers are served in terms of both product and service. Every company have started adopting the combination of different CRM approaches for customer retention, customer satisfaction and improvement of service quality.

CRM systems enhance knowledge integration that facilitates company ability to know their customers immediate needs, the capability to anticipate and solve future needs and providing customized services and goods.

Customer relationship management (CRM) is popular business strategy in today's competitive environment. Customer Relationship Management is discipline which enables companies to identify & target their most profitable customers. It involves new & advance marketing strategies which not only retain existing customer but also acquire new customers. It is a unique technique capable of remarkable changes in output of financial organisations.

In CRM database, customers purchasing behaviors may easily be analyzed. By mere assessment of previous customer buying habit, new product information can be sent to customers. With this, products and services are promoted by analyzing the interest of customers, whereas unused products are removed by assessing the information in the database [29].
This is the first and foremost guiding principle in CRM. Who is a customer? A customer is a person or group of persons who receives the product or service, the final output of a process or group of processes. As a part of this focus on customers, banks must make sure that clients are correctly identified; requirements are appropriately determined, understood and met enhancing customers' pleasure.

CRM systems also play vital role in marketing a company. With a strong marketing policy, companies can discover and understand customers need and also improve on them. CRM systems increase competitiveness among enterprises.

The system should be responsive and deliver to customers what they desire. Additionally, the target should be to accomplish more and to surpass the customer's expectation to accommodate future requirement and to bolster against the competitors' attributes. CRM represents the management of the complete system and is not limited to only one or the other sub-systems or departments. Its main objective is to increase value to the bank's customers on a endless basis by designing and refining organizational processes and systems on an continuing basis.

Since CRM strategy will be totally unique to each company, this may cause competitive advantage, promote customer relationships management and boosts customer satisfaction and retention [30].

3.2 Customer benefits

3.2.1 Customer satisfaction

Because of the importance of customers to the growth of any business, there has been a tremendous amount attention to this concept. Wang et al (2004) noted that the central objective of CRM is to ensure steady streams of revenue and maximization of customer life time value or customer quality and customer behaviors [31].

The relationship with the customer should be based on a mutually beneficial relationship. A bank should not focus its attention on earning of profits only, but focus should be directed to the customers' wealth creation or value augmentation with the aim of earning through service. Retention of customers and building a long lasting relationship is the central criteria under this concept.

Hence, CRM systems performance is focused on customer behaviors since it could impact on the organization future.

It also imperative to know that customer satisfaction contributes immensely to the profitability of a business.

CRM is a business approach that integrates people, processes, and technology to maximize the relations of an organization with all types of customers. CRM helps in understanding the customer better, which enable organizations to effectively customize their products and service offerings according to the customer needs in order to retain customers and increase customer's loyalty and satisfaction. Many organizations are embracing customer relationship management strategies to reap benefits such as enhanced revenues and high profits.

Satisfaction is the process of equating opportunities with performance. Thus, it is believed to encompass cognitive practice within consumers’ cognizant control and emotional practice outside of the cognizant control [32].
CRM, being the soul of future banking, proper understanding of the key principles, its theories and practices should be revisited and redefined to provide a road map to generate new ideas and technique in the turf. Over the years, banking institutions have been feeling the pressing need of putting up greater force on this initiative for improving their operation and appearance.

Hsu and Lin (2008) submitted "when satisfaction becomes an important element, CRM affects retention not only independently but also collaboratively. Moreover, the main effect of CRM is conspicuous for retention; customer satisfaction is very complicated and multi-dimensional phenomenon" [32].

3.2.2 Customer value

In the past, customer value was constraint to just quality and price, but nowadays researchers are of the opinion that there are other functions to this concept. Sweeney and Soutar (2001) submitted that it is imperative that enterprises take note of this concept because if they understand it, they will be able to evaluate process of customers and re-engineer their resource and activities [33].

Today's banking is not simply a function of accepting deposits, lending and money transmission. The banks have now diversified themselves into insurance, brokering, advisory services, merchant banking, factoring and almost every legitimate financial activities.The banks are now transforming themselves into a customer centric service centers rather than the transaction- processing centers.

"CRM is a corporate strategy and systematic approach based on relationship and one-to-one marketing that aims to integrate management of personalized relationships with customers and to continue customer’s value in the long term and to maximize value creation for companies." [32]

"Customers are becoming more value-oriented and are not simply influenced by high quality or lower price. Nevertheless, they can make a reasonable trade-off between the benefits and sacrifices in the process of obtaining and consuming products or services.

All processes should meet the legal and statutory requirements to perform the activity or deliver the product or service.

However, not all customers value the same benefits and care for the same sacrifices at any given time" [31].

3.2.3 Customer Retention

"Customer retention can be achieved by attractive customer satisfaction and loyalty, civilizing problem decrease, and creating the ability to recognize and save "at-risk" customers. Actuality, an "at-risk" customer represents a major chance for extra income - if handled correctly. For example, a customer makes a large extraction from his or her account.

The study will also be of interest to managers and marketers of financial services as it will provide insight into how an important segment of the customer relationship management makes decisions. The results of the study will help tailor products and marketing efforts better for banks attempting to attract/retain customer.

This may sign that the customer is transferring money to a second bank. CRM driven practices aid in customers retention and also help to migrate meager account holders to more profitable and long-term customers" [34].

3.2.4 Customer Achievement

CRM systems is expected to assist customers in accordance to the "value" its bring through the life of the customer and beyond through marketing. Enterprises must ensure that their value propositions have connection with the right market segments.

Where personal management of relationship will be given to high value and business customers on the other hand automated relationship management can be given to low margin or mass market segments.

This will allow them to achieve their goals and gain new customers [34].

3.2.5 Customer trust

"The continuing search for added value and competitive advantage, increasing competition, similarity in core products and lack of customer loyalty lead companies to search for new ways of gaining competitive advantage over their rivals; This implies how to create offer more unique, valuable on the basis of unique business system based on multidimensional competitive advantage, better than their competitor" [35]. Thus, there is necessity for marketing technique such as customer relationship marketing (CRM) which facilitates trust between customers and suppliers to increase retention rates.

Now a day's many financial organizations have been pioneers in developing customer retention strategies. Banks have relationship managers for select customers, airlines have frequently flyer program to reward loyal customers, credit card offers redeemable bonus points for increase card usages, telecom services operators provides customised services to their heavy users, and hotels have personalised services for their regular guests.

"The successful delivery of CRM benefits requires fundamental changes in the way that the organization approaches marketing management. In its consequence, it represents a corporate restructuring caused by positive reasons that involves all functional areas; including production, property, financial, business, organizational and personal" [35]

3.3 Business benefits

I have so far discussed the benefits of CRM systems to the customers. But, here I will also discuss the benefits of CRM systems to the business.

The creation of mutual benefits for all the parties involved in the business process is the core of a perfect CRM strategy. It helps in creating a sustainable competitive advantage by being the best at communicating, understanding, delivering and developing existing customer relationships apart from adding and keeping new customers.

I have explained earlier that CRM has lots of benefits and also could have good effect on the customers, but the question is that how it can impact on whole business? I will discuss about a view that divide the business benefits of CRM systems to three sections.
Customer relationship management does not enable a quick win. It is a long-term approach that has to be adopted at a strategic level. Whilst the value of customer relationship management has been identified by organizations, they are yet to look at the bigger picture and understand all of associated benefits that would enable their business strategies to be successful. Those responsible for delivery are perhaps the most informed about these strategic benefits yet the transformation is long-drawn-out process. The competencies required to deliver these customer benefits are: to deliver on its service promise, integrate products and service channels effectively, customize products & service and their respective prices, create opportunities for cross selling and delivery mechanisms for the onward promotion of these products and services and reduce the gestation period to market by allowing quick and effective introduction of new products and services.

This view is exhibited by three students‟ names Goodhue, Wixom, and Watson in Georgia and Virginia University in the United States. In their research they examined the business benefits of CRM in some organizations.
Unstable environment (financial crises) has forced organizations to restructure themselves in order to enhance their chances to survival and growth. The restructuring efforts have included, among others, the emergence of the "new paradigm" which is commonly referred as Customer Relationship Management (CRM). Customer Relationship Management business strategy places the customer at the centre of the organizations' universe. Maintaining One to one Relationships in today's world are more important than anything else which an organization wishes to maintain with their associations. It has become extremely important for all organizations to maintain rich and fruitful relationships, and it has become even more and more important to sustain them to be rewarding forever.

They were of the opinion that using CRM systems has three targets and by reaching to these targets managers can enhance their business profile.

3.3.1 CRM Application

The first target according to them is application. With this concept, they showed that some organizations strongly need for a particular CRM application and the benefits that are likely to be obtained.

The basic proposition of a CRM strategy is based on the age-old idea that knowledge, understanding, and serving the customer is the best method developing a sustainable competitive advantage. But building a sustainable and successful relationship with a large customer base is not the easiest thing to do and carries a direct impact on many core operational processes. At the heart of a perfect CRM strategy is the creation of mutual value for all the parties involved in the business process. It is about creating a sustainable competitive advantage by being the best at understanding, communicating, and delivering values to the existing customers in addition to creating and keeping new customers. It addresses to the changing needs of the customers by developing products and services that continuously seek to satisfy the lifestyle and need patterns of individual customers. Organizations tend to acquire a structure around customer segments and not on the basis of product lines to deliver customer satisfaction.

They are not prepared to run into a CRM effort and due to their culture they must first test and establish the concept before applying it in the organization. The outcome of this research showed that the use of individual application assists organizations to know important impacts in each department.
To evaluate the results and provide detailed conclusions based on the primary research findings. Use the conclusions to make recommendations for businesses and further academic research.

Although, it was stated that implementing this view may bring some challenges for an organization [36]. They further stated that an intently attention on this approach can help an organization to have a better customer relationship management.
Turning any good business strategy into actionable items is a difficult task for an organization as big as a bank. This is where Customer Relationship Management works like a magic.

In total, individual approach can bring about lower-cost efforts

3.3.2 Infrastructure

The second target according to them is the infrastructure. An organization must complement an efficient application with strong and suitable infrastructure to exchange information.

The survey questionnaire, once completed, is analyzed by the researcher with the help of SPSS software to conclude the findings and provide future recommendations.

An enterprise must work together in a synchronized way with their customers. By doing this, they demonstrate that without coordination, it may be impossible to have good customer relationship. In attaining this goal, managers require a powerful data infrastructure that are supported by both hardware and software infrastructure that can make the organization to make a fast data recovery [36].
While this may sound quite straightforward, for large organizations it can be a mammoth task unless a gradual step-by-step process is adopted. It does not happen simply by buying the software and installing it. For CRM to be truly effective, it requires a well-thought-out initiative involving strategy, people, technology, and processes. Finally, it requires the realization that the CRM philosophy of doing business should be adopted incrementally with an iterative approach to learn at every stage of development.

Goodhue et al (2002) further suggested that the first step for each organization is to have an integrated system across the organization. The organization must first "put in place a data resource that is integrated across various source systems and customer touch points, using a single unique identifier for every customer; and keeps the data intact, timely and reliable". Though IT department understands the benefits of these infrastructures, but the challenges that most organizations may have is that "infrastructure investments are costly, and the gains are not really immediate. To convince the company’s management; IT department must tell them on the concrete business value of such infrastructure investments" [36].

The implementation of this approach enables the enterprise to have successful CRM programs by first focusing on their infrastructure, thereafter extending it and capitalizing on it to deliver value.

Proper respect should be extended to the customers. All relevant information should be collected from them with humble and polite approach. Proper value should be given to their feedback.

This can help organization with some important benefits such as laying foundation for other CRM activities and identifying key loyalty drivers [36].

3.3.3 Organizational Transformation

The number three target is organizational transformation. To be a strictly customer-centric, an enterprise needs the shift in their culture and business practices.

Implementation of CRM can be successful only when banks are able to identify their internal and external customers and then integrate both of them within their core business process.

Changes in the enterprise can involve things like "information systems to business processes, incentive structures, organizational structures and employee roles. Firms that embrace CRM generally make this organizational transformation slowly, even if that is not intended.
Indian banks are realizing gradually that it is no longer profitable to have a "transaction-based" operating model and dynamic efforts are made to develop a relationship-oriented model of operations which are focused on customer-centric services. Today, the biggest challenge that Indian banks are facing is to establish intimate relationship with the customer without which all other efforts towards operational superiority are meaningless. Through services, the banks need to make sure that the customers approach back to them. The reason is that most of the banks earns major chunk of income for from existing customers, rather than from new customers.

Although organizational transformation is difficult and risky but has potentially very high payoffs as the organization shifts its business processes, culture and technology to truly become customer-centric" [36]. According to views of Goodhue et al (2002) "companies can reduce their risk of failure by having a clear vision of CRM infrastructure, target application and transformation".

3.3.4 Other Researcher Viewpoints

Other researches see these three points as a main business benefits. Chen and Popovich (2003) are of the same viewpoint to these business benefits.

Analytical: This aspect deals with analyzing information about customers and using if for the business intelligence purposes.

They submitted that business process change, technology and people change are the major targets that will propel an enterprise to high profitability and good customer loyalty [30].

But Harej and Horvat (2004) in their own research noted that "business processes have to be integrated across marketing, sales and customer support. Also processes in connection with business partners and employees have to be considered.

Operational: This aspect deals with the concept of making some processes automated.

Knowledge about specific customers is needed before an organization establishes such change management". They emphasize that total commitment of company’s management is imperative for the success of the organizations [37].
The key focus of financial relationship is frequent marketing programs founded on financial incentives such as lower rate of commitment charges, reduction of processing fees, organizing Loan-Mela on special occasions etc. A social relationship program is based on the social attachment between a company and its customers and creates brand loyalty. The optimization of structural relationship relates to the replacement of physical resources by total service replacement.

Hoon and Gul (2003) believe that for an organization to have a successful management, managers of such enterprise must have to "support diverse customer information - such as of-the-customer, for-the-customer, and by-the-customer information". They also demonstrate the key role customer information system (CIS) plays in managing and distribution of customer information.

The study will be of interest to academics that have an interest in financial services marketing. The results will add to, and update the limited academic literature that presently exists on banking behaviour and, more precisely how customer decide which bank to patronise. The study will also provide a useful information about status of customer relationship management in banking sector.

Their research also emphasizes on customer information and encourages improvement and enhancement of the IT department. This they said will reflect on whole business process that the organization is customer centered, and consequently help the managers to consolidate the customer information and have a better idea about their needs, and as result enhance the overall business of the organization [38].
Banking can be sometimes difficult for customers and how they manage their finances can also be a complex thing to understand. The challenges faced by today's Indian banks and their customers are many in number but the key lies in acknowledging and understanding these complex financial relationships.

3.3.5 Customer support

Application of CRM systems enables an enterprise to support their customers so that they can have high level of value from the customer purchases. Using CRM systems assists an organization in finding new market opportunities and to make a competitive advantage over other competitors.

Implementation of CRM in Indian banking is still in its nascent stage and has to travel long and tough path in order to raise it to the global standards. But the Indian private banks in association with their public counterparts are considering the issue on a large scale in order to remain competitive to foreign and other private sector banks.

A CRM system enables customer support service to evaluate customer support needs during the new product development process [39].

3.3.6 Customer segment

If an organization segments its customers, such organization could gain the customer preferences in order to efficiently distribute resource according to information. The segmentation enables the organization to "differentiate themselves by providing appropriate and suitable services for their customers’ needs, therefore building up a competitive advantage, and second direct companies to where their most valuable customers are located and helps allocate major capital, effort and time to generate the most profit" [39].

Chapter Four: Bank Background Case Study

4.0 Customer Management in Nigerian Banks

Marketing is known to be one of the most powerful business’ tools that enhance the profit portfolio of an enterprise, particularly banks. A senior top manager of Zenith bank submitted that aggressive marketing by various stakeholders in the bank has contributed immensely to the bank successes.

Even though CRM as a concept originated some years earlier in the past however its principle has been around for some time in the India banking industry. Field officers of various banks have always contributed in building strong relationship with the customers; however the focus on customer orientation rather than product orientation as a philosophy has been in the Indian banking industry for around a decade now. But then, to implement customer relationship management is a hard nut to crack.

He also submitted that with aggressive marketing, about 5% of customers can generate 85 % profit of a bank.

Customer Relationship management (CRM) is a business strategy that every bank should embrace.

CRM in banking industry has been studied by Smith (2006); Pedron & Saccol(2009); Menon & Connor (2007); Roy (2008); Zineldin(2006); Lin, et al(2009) ; Hubbel & Reeding((2003) and so on. Customer Satisfaction and Customer Loyalty have always been an important element of study and therefore, many a times has been connectively studied by Szwarc (2005); Hill & Alexander (2006); Titko & Lace (2010); Beerli, et all(2004); Ta & Har (2000) ; Mishra(2009) ; Kayis, et al(2003); Amin & Isa(2008) ; Hart, et al(2007); Blery, et al(2009) ;Winnie, et al(2001) and more.

Effective banking requires aggressive marketing, deployment of latest technologies and a superb customer service [40]. The adoption of IT systems by companies aid better communication with customers since IT infrastructure helps with fast information delivery and sharing of information with customers.
The aim of the study is to evaluate critically the status of Customer relationship management in Indian banking sector.

Zenith Bank Ltd was founded in the early 1990’s. The bank was a product of deregulation and liberalization policies of the Nigerian government. According to Balogun (2007) review article, he wrote that Professor Charles Soludo (CBN Governor) reforms were focused on strengthening the financial systems through banking sector consolidation in which Zenith bank was one of the twenty five banks that emerged as a product of the deregulation and liberalization policies of the Nigerian government [41].

Banks will have to take pragmatic decisions with a clear plan before choosing which delivery channels to use for their different products and services.

Currently, due to tremendous competition in the banking industry, most banks have adopted CRM systems to enhance their operational efficiency and profitability.

For banks to maintain and strengthening their customers’ base, they must embrace and implement powerful and useful CRM systems.

In this paper I want to show, how CRM works, how CRM can be implemented in banks and what problems can result from the implementation.

This statement will remain true because customer management is the pillar of successful banking system. The implementation of CRM system makes banks to have a shorter sales cycle and hence increase revenues.
The proposed study is limited by time constraints; a time limit of 12 weeks. The delimitations of the proposed study are funding and geographical location. The study is not receiving any funding and the researcher is based in Salford, UK. However, as explained in the proposed methodology section, a self selection questionnaire has been selected as it is both cheap, and fast to administer.

The general expectation of CRM systems implementation to both customers and the business is to increase speed and reduce waiting time on queues in banks.

The deregulation and liberalization of financial institution and privatization policies of the Nigerian Government had made almost all government owned banks to become private banks.

The concept of maintaining one to one relationship with customers was formally introduced in early 90's when financial services, airlines & other institutions stated to 'reward to retain' the existing customer by introducing loyalty programs.CRM was introduce in late nineties.

There are many types of banks in Nigeria, each of these types of banks are operating under different set of rules and policies. We have commercial banks, mortgage banks, micro-finance banks and agricultural banks [42].
Berry (1983) recommended the following five strategies for practicing relationship marketing i. Developing a core service around which to build a customer relationship, ii. Customizing the relationship to the individual customer, iii Augmenting the core service with extra benefits, iv. Pricing services to encourage customer loyalty, v. Marketing to employees so that they will perform well for customers.

Zenith bank falls under the commercial banks that privately owned and established by private individuals, and the bank is one of the two banks in Nigeria that is managing Nigeria’s external reserves.

There are variances in ways in which CRM systems is being implemented in private and governmental banks.

Ironically, the Reserve Bank of India's moves, to cut the interest rates aggressively after 1999, pushed up the prices of bonds. Hence, banks had a windfall doing almost nothing. The bond profits, like manna from heaven, improved the balance-sheets of all banks irrespective of their core performance. However, the era of lazy banking is soon to end and the mesh of rules that propped up the Indian banking industry is now being dismantled rapidly.

While managers and other employees in private banks have respect and regards for customer’s time and values, their counterpart in governmental banks care less about customers’ time and values.

A CRM system is imperative to the operations and activities of private banks, while in governmental banks CRM systems are not fully implemented.

While CRM may already seem to be an old and jaded term, there is a bright future ahead that will bring new ways for small and mid-sized organizations to communicate, operate and strategize to manage their personnel, customers and prospects.

The governmental banks are still working with the old systems and consequently they are characterized with long queues at the banking halls, ineffective customers’ services, prompt breakdown of IT infrastructure, weariness and poor accuracy to perform normal banking services [43].
Moreover the European Basel guidelines dictate the banks an aggravated minimum capital for covering the credits and better credit investigations. The consequences for banks were higher labour costs and more equity costs for covering the credits.

4.1 Zenith Bank

4.1.1 History

Zenith International Bank Limited was established in 30 May 1990 with its head office located in Lagos Nigeria. The bank is a private limited liability company and was licensed by Central Bank of Nigeria (CBN) in June 1990 to operate banking business in Nigeria.

A company must understand and know how to use all three aspects properly, and when they do this effectively, they can be in a position to build strong customer relationships and to ascertain their profits for a long time in future.

The bank's name was later changed to Zenith Bank Plc. in May 2004 to portray its position as a public limited liability company. Zenith bank shares were listed on the Nigerian Stock Exchange in October 2004 due to a highly successful Initial Public Offering.
Successful mass customization is essential to reduce the customer acquisition cost and enhancing the cross selling ability.

Nigerian institutions and private individuals of over a million currently hold the shares of the bank.

The bank's major service delivery channels in Nigeria are its business offices which as at 2012 had increased to over 338 branches and more than 125 cash offices.

What is CRM and what will it deliver to the banks? CRM is, probably, one of the least clearly defined business acronyms, as there is no single definition for it. It is probably easier to say what CRM is not. Unfortunately, CRM has also become a misnomer for a range of solutions from IT vendors, each providing its own spin on the idea.

These offices are situated in key business and commercial centres in every state in the country and Abuja. Since the beginning of its operation, the bank has been making its mark in profitability and every other performance indices, and is maintaining this leading position till date.
Some of the basic characteristics viz. Integrity, Dedication, Magnanimity, Humility, Openness, Creativity, Fairness, Assertiveness, Sense of humor must be properly imbibed within a leader in order to take out the assist the confused customers and thus help in resolving the matter in best possible manner. A leader does not suffer "analysis paralysis" but is always doing something in pursuit of the vision, inspiring others to do the same.

Zenith Bank Plc has grown progressively to become a financial services institution of choice with presence in Africa and the United Kingdom. This is because of the bank’s strategic measure in surpassing the limitations of the Nigerian banking industry, and strengthening its brand.

Trying to develop competence only in one area alone cannot help the today's Indian banks competitive enough to sustain in the banking industry.

The striking performance of the bank in all its branches within Nigeria and abroad is a testimony of the bank's ardent commitment to global best practices and steady reliable service delivery [43].

4.1.2 Business

The bank is a leading financial services provider in all areas of banking that provide and satisfy the banking needs of its numerous customers both in private and public sectors.

The core businesses of the bank are:

Investment and corporate banking

Private and personal banking

Treasury and cash management services

Consumer and commercial banking

Foreign Exchange and trade service

Non-banking financial services through its subsidiaries

Zenith bank provides specialized financial services like Pension Management but would not provide services in Insurance, Capital Market dealings, Trusteeship, Registrar, Mortgage and financial advisory services because of its resolve to focus on the commercial banking license with international authorization [43].

Personally through individuals such as customer service manager.

4.1.3 Culture

The bank culture is exceptional service delivery that exceeds customer beliefs in accordance to global best practices with the highest industry standards. All these potentials have bonded the bank to its numerous customers who have been of tremendous assets to the bank.

For effective functioning of an organization, it has to identify and manage numerous linked activities with the help of different processes for accomplishing its goal.

The bank philosophy of engaging the services of the best has attracted the most professional and highly motivated workforce in the industry that discharges their duties with the utmost integrity and professionalism.

This essay has been submitted by a student. This is not an example of the work written by our professional essay writers.

Zenith bank places steady importance on its main business strategy based on People, Technology and Service [43].

4.1.4 Customer Base

Zenith bank customer network comprises largely corporate bodies most of which are subsidiaries of multinational corporations and large indigenous companies. The bank lending strategy emphasizes on rational practices and transparency. Because of this approach, Zenith bank credit portfolio is the best asset quality in the banking industry in Nigeria.

To order to experience the full benefits of people participation, the human resource management must focus on employee empowerment, zero defeat service oriented training, and productivity linked reward and total quality management.

The bank's non-performing loans to total loans ratio is lower than industry average right from beginning and through the thick of the global financial crises in 2008/2009 [43].

Zenith bank customer base, which is over 1.6 million accounts, cuts across the following sectors:

ICT and Telecommunications

Transport, Shipping and Aviation


Oil and Gas

Power and Infrastructure

Real Estate, Building and Construction

Commodities and General Commerce

4.1.5 Vision and Strategic Objectives

From the beginning, the bank demonstrably defines service standards in the banking industry with its drive for a unique customer experience, service quality and the strength of its customer base. Currently, the bank is known with the following qualities in the Nigerian banking industry:


Strategic distribution channels

Stable and dedicated management team

Adoption of latest Information and Communication Technology solutions

Excellent financial performance

Good asset quality

Highly skilled personnel

The vision of the bank is centered on "building the Zenith brand into a reputable international financial institution recognized for innovation, superior performance while creating premium value for all stakeholders". The tactical objectives of the bank consist of continuous improvement of its capacity to meet the customer's increasing and dynamic banking needs and to maintain highest quality possible growth in an unpredictable business environment by [43]:

Investment and deployment of latest and state of the art technological solutions

Branch network expansion

Training and re-training of personnel

Employment of the best manpower available and motivating them

4.2 Zenith Bank’s IT and CRM systems

Zenith bank’s electronic-strategies (e-strategies) are centered on internet banking services, mobile banking services and telephone banking services together with CRM as its distant delivery channels. The CRM implementations of Zenith bank are centered on the following:

Customization and localization: Appropriate software systems are purchased from reputable foreign firm; which is customized for the bank in line with Nigeria’s banking laws.

Customer relation is that aspect of relationship marketing that pursues and guarantees customer loyalty by fulfilling promises. It continues to satisfy the bank's customers' wants and needs so that defection is absent. It involves of three levels of relationships - financial relationship, social relationship and structural relationship.

Database migration: The old database were discarded and incorporated into new database systems.

Training of staff/users: Managers, employees and customers are trained on the use of the new systems.

Infrastructure: Networks infrastructure, data centers equipment and recovery databases were provided.

Back up: The new systems are duplicated for a back-up provision incase of unexpected failure.

With the successful implementation of CRM system, the various modules such as telephone, mobile internet and customer management service (CMS) were integrated into the CRM system and the outcome was an integrated e-banking system, which Zenith bank is a reference model in the Nigerian banking industry.

The banks should acknowledge the fact that pursing new technology is not enough, and faultless implementation is the key to success. In fact, this is where the human resource aspect comes into the picture.

Chapter Five: Findings and Analysis

5.0 CRM system Implementation

Broadbent & Weill (1998) noted that "creating IT infrastructure around business driven requirement are based on firms strategic perspective and proper IT infrastructure, and selection of technology is key requirement of CRM system" [15]. A senior manager in CRM department in Zenith bank submitted that their major strategy in the bank in the implementation of CRM system is the selection of suitable technology.

Customer Relationship Management strategies of the three of the top Indian banks namely, ICICI Bank, HDFC Bank and IDBI Bank have been analyzed and tabulated in a concise form in this section of the report.

After the selection of appropriate technology, they then estimate the cost of implementing the selected technology; costs such as installation and training of users. Thereafter, they try to identify the type of CRM data that can be used to address the problematic areas in the customer relationship cycle and the value such process have on the organization.
When there is a slight chance of getting a business but the client is hesitating or in a fix, or not in a position to decide properly, proper follow up by relationship manager by patient hearing, kind counseling and to stand by the side of the prospective client to help clear his doubts and to make him feel happy by realizing that he is going in the right direction and he is very right in choosing his requirements.

Zenith bank uses front end technology during the selection process, with this they relate and interact better with their customers by employing information system based tools. Hill and Shore (2005) noted that technology should basically be employed as a tool for customer management and essential for implementing CRM system successful is the front end planning and the use of data collected [44].

Ways and means should be identified and practiced of getting and staying closer to customers.

Zenith bank employs centralized server based CRM software tool that has every information about customer management stored in the sever; this enables them to have important information about their business and be connected to their customers.
Training and motivating the employees so that it develops skills, right attitude, expectations, perceptions and behavior.

Zenith bank central features of CRM system software are email marketing and reporting since these make it possible to spread information to many potential customers at a very low cost and within short time.

All processes should be de-signed keeping in view the requirements and desires of the customers, within the policy, resource availability, strategy of the company.

These are then complemented with the ability to customize the knowledge base to enhance changes in the collection, organization and retrieval of information about the customers. Zenith bank CRM system software comprises of other features that enhance wide variety of reports such as sharing of documents, tracking of support and tasks.
It is to be communicated to all employees that all customers should be given a proper hearing and it should be supported from all levels.

Zenith bank employs integrated approach in implementing its CRM system. This takes the form of using a single database for the storage of all information across the organization and hence enables them to have full customer view that facilitates better customer service.

To understand the factors taken into consideration by the customers while selecting a bank.

Boon and Corbitt (2002) submitted that to get better advantage from CRM system, an enterprise must embrace integrated approach during the implementation of CRM system instead of using technology in a separate island [14].
All the processes should be properly integrated to meet the goal congruence and should not function at cross-purpose.

With a centralized single database Zenith bank is able to store and use customer information efficiently.

According to senior official of Zenith bank, some risks and challenges arise during the implementation of CRM software. The major problem in Zenith bank is the training of personnel on the use of the new software. Foss et al (2008) reported that employee’s engagement encompasses their support and obligation towards CRM implementation and "organizations cannot operate and develop customer focused CRM software without motivated and trained employees" [8]. In the beginning of CRM system implementation in Zenith bank, another challenge for the bank was customer’s awareness. Because of this the bank missed some customers in the initially due of newness of CRM software in the bank and because of less ability of their personnel in the use of the software.

Increase in the ability to adapt changes in the business environment.

Meyer et al, (1998) noted that the success of a large-scale change initiative, like the one incorporated by implementing CRM system is dependent on having personnel with very high readiness of affective commitment to change [19]. Employees’ effective commitment to change is one other issue face by the bank in their implementation of CRM system.

Collaborative: This aspect deals with communication between organizations and their clients.

The bank reported that they initially faced with the challenge of employee commitment to change as the problem of resistance and difficulties from employees of how to use the CRM software arose. However, the bank noted that they were able to overcome this problem by training and re-training activities and by enlightening them how their works would be easier and simpler after implementing CRM system.

Ramsey (2003) advised that certain strategies such as customers, channel, brand and application choice are imperative for an enterprise in the course of implementing CRM system [21]. But Zenith bank did not have any system in place to know about these strategies before implementation of CRM software. The bank got ideas about these during monthly evaluations based on the scale of customers and monthly investment’s estimation of customers. Initially, the focus of the bank was on brand as they considered brand value imperative in identifying the customer behavior and enhances revenue portfolio and capital efficiency. Christ (2006) noted that an enterprise has to commit itself to its brands, which requires them to know their customers’ necessities and preferences and consequently come up with changes based on the feedback they got from their customers [24]. Thus, Zenith bank brand value strategy is employed for motivating customers and to enhance profitability.

CRM should then be communicated to all those who are involved. This objective is important as it increases sales indirectly as a result increasing the profitability.

The bank employs various ways and channels such as telephone and email. They do send email to their customers and also notify their customers of new information or changes in their operation and services. The bank uses the channels in evaluating the appropriate and potential channels available to them; and embraces brand value strategies to identify their customers’ behaviors.

5.1 CRM system and customer benefits

Implementing CRM system was initially hard and challenging for the bank just like any organization that is trying to introduce a new system into its network. Since the bank is one of the banks that first implemented CRM system in Nigeria, it brought some problems for the bank because the system was strange to the Nigerian banking industry. But with advertisement and training of personnel, the system started becoming popular in the Nigerian market and many other banks and corporate organizations started embracing it. After couple of years the bank became successful and their customers based had increased more than expectation after implementing CRM system. Their customers increased by over 50% within couple of years of successful CRM system implementation. Thus, this shows that employing CRM system was an important competitive advantage for Zenith bank over its competitors.

Competence, Communication and Conflict handling are the key attributes in today's Customer Relationship Management.

One of the most important functions Zenith bank used in increasing and sustaining the customers was satisfaction. Managers believed that using this system is not enough but they have to remain with their customers and must improve on the numbers of customers they have based on the fact that for a bank the number of the customers and their satisfaction are the important functions. Because, when the number of customers increases, profitability will also increase too. This theory is also applicable to Zenith bank. Hence, satisfaction of the customers is key important function to Zenith bank.

Attaining the level in which the bank is today is not an easy journey. Initially, during the implementation stage of the CRM systems, the bank confronted many challenges in the various parts of the organization, while the customers were also confronted with many problems. The problems confronted by the bank if had not be managed properly could have led to losing high substantial numbers of its customers and as a result decline in profitability. The first major problem for the bank is how the bank’s customers would cope with e-services comprising of internet services, telephone services, e-payment and e-application. The problem is even more severe for uneducated customers. Although the bank lost substantial numbers of this class of customers since they were unable to cope with the innovations of the bank. With the new system, many thing were change in the bank’s systems and customers were nor familiar with them. But with superb customer service unit support both in the banking halls and via telephones, the bank was able to solve the problems the customers were encountering with the new system. According to the bank’s official, they perform routine maintenance and updates on the system to avoid any major breakdown.

Now that the customer’s problems have been solved, CRM system has been of great benefits to the customers as their banking transactions are easier than before. Moreover, the system has been of great benefits to the bank as employees do their works faster but also helps to have a better relationship with customers; and having a better relationship will help them to know the customers problems better. But one thing the bank refused to mention is that the implementation of CRM system helped the bank to cut some jobs as the system made the bank to lay-off some redundant employees after successful implementation of CRM system.

In line with the submission of Wang et al (2004) "customers are becoming more value-oriented and are not simply influenced by high quality or lower price. Rather, they tend to make a reasonable trade-off between the perceived benefits and perceived sacrifices in the process of obtaining and consuming products or services. However, not all the customers value the same potential benefits and care for the same sacrifices at any given time" [31]. The bank built its systems with new services and they are providing support to their customers and keeping them informed about the changes and modifications to the system.

There should be in built control mechanism for ease of measuring, reviewing and taking corrective action.

CRM system helps organizations to support their customers, helps in finding new market opportunities and to make competitive advantage. Thus, CRM system is a valuable resource to an enterprise.

In today’s technological world with increasing number of customers and banking transactions, banks must continuously make modifications to their systems to have better and easier system and consequently leading to better relationship between the customers and the bank. In Zenith bank, there is a unit in place in the bank that works 24/7 that is responsible for recognizing the problems and proffering solutions to problems detected or reported by the customers. The bank does this because they are of the view that customer satisfaction is paramount and that customer satisfaction aids profitability of the organization.

5.2 CRM System and business benefits

The bank’s senior official stated that implementing CRM system in the bank’s operation does not only provide customers’ benefits but also a great deal of business benefits to the bank. These benefits include improvement in customers’ information quality, internal efficiency and system support enhancement. Roh et al (2005) noted that the "ultimate measure of CRM success is achieved when CRM system equals net benefits" [6]. There has been an average increase of 50% in sales and increase of 67% in revenues since the implementation of CRM system by the bank; an indication of the business viability and benefits of the CRM system to the bank.

The bank’s official also noted that CRM application, organizational infrastructure and transformation also play greater roles in getting business benefits. This is centered on selection of proper technology and transformation that are necessary to gain business’s benefits from CRM system. Though, the bank acknowledged that organizational transformation brought challenges due initial reluctance to change from staff. Goodhue et al (2002) submitted that organizational transformation brings some risks and most often not easy but has great benefits overall as it allows the organization to be truly customer-centric [36].

Zenith bank business prospects increases by CRM system application since the system enhances customer-centric strategies. The system enables the bank to facilitate more customers’ oriented services with improvement in sustaining and managing customers over a long time. One of the bank’s strategies in customers satisfaction is centered on quality training and re-training exercise for its employees. With quality training, employees provide good services to the customers and also portray good image of the organization. Thus, customers flow into the bank in numbers and invested in the bank. Such investments from customers bring more business openings and profitability for the bank.

The implementation of CRM system by the bank also aids the bank’s operational efficiency since it makes processes easier, shorter and faster. Irani (2002) noted that "the purpose of IT investments is to improve operational efficiency; many traditional appraisal techniques may be considered appropriate. Such investments are largely geared to the generation of tangible (financial) benefits" [45]. These tangible benefits are apparent as investment in CRM system yields 67% increase in profits.

CRM system helps in growing a business as the case of Zenith bank. The bank noted that they recorded growth in their business through incorporation of useful data and information obtained from their customers into the CRM system; which other organization signaled their readiness of buying from them. Thus, this is an example of classical case that CRM brings new business opportunities for an organization. The implementation of CRM system aids the bank in calculating the cost and return on investment as noted by the bank that the budget of implementing, installing and training is at strategic side in the implementation of the system. Smith (2006) noted "by using CRM systems an organization would be able to support their customers in order to achieve high level of value from the customer purchases" [39]. The bank provides customer support for its CRM system through the customer service center and a special unit in the IT department that operates 24/7 who is ready for customers’ complaints and provide them with the support that are necessary. By attending to customers’ complaints, Zenith bank receives customer support and gets benefits from it.

Chapter Six: Conclusion and Recommendation

This research has demonstrated that CRM system can be of great benefits to any organization. CRM system enables businesses to strengthening and increasing the relationship with their customers. In order to gain the expected benefits from CRM system, the system must be implemented in accordance to the strategy. Most businesses developed their strategies by paying attention to their customers and brand value before implementing this system. In Zenith bank, CRM data are being used to locate the problems discovered in the customer relationship cycle and the outcome of this is that it is winning and attracting more customers to the bank.

Selection of appropriate technology and formation of technological infrastructure are imperative to successful CRM system implementation. In the course of implementing CRM system, some fundamental issues such as training of employees, customer awareness, possibilities of losing some customers at the beginning of the system and uncertainty of return on investment are easily overcome with total support of top management staff. The challenges with employee’s commitment to change are fixed by enlightening employees the advantages they would have with the implementation of the system.

There is no organization that can be successful without customers’ satisfaction showing that customers is a determinant factor in the growth of a business. An organization cannot attain its objectives if they do not satisfy their customer requirements. CRM system allows enterprises to have good relationship with their customers and understands their requirements. On the business side, this system enables organizations to achieve their goals such as competitive advantage over other competitors, profitability, customer value and customer satisfaction. The data and information that I obtained from Zenith bank indicate that CRM system brings benefits to both customers and the business. On the customers’ benefits of CRM system, the expected result is that CRM system should enhance the number of customers with increase satisfaction of customers, which is the case of Zenith bank. My study discovers that after successful implementation of CRM system, there was 50% increase in the number of customers, whereas other banks that did not adopt the system have only single digit percentage growth

On the business benefits of CRM system, the system helps the bank to expand its operational networks as more branches were opened due to increase in customer numbers, sales and revenues. The system also helps to improve operational efficiency and collaboration across the bank as it makes processes easier, faster and simple. Some of the banks satisfied customers made more investment in the bank, which the bank diverted to its subsidiaries for more profitability.

Adopting a system like CRM system that is ICT oriented in a developing economy like Nigeria is not really an easy task. This is because such an economy is sure to be characterized with high numbers of uneducated customers and who are most often reluctance to change. This factor played an important role at the early years of CRM system implementation in Zenith bank, as the bank lost a good numbers of its customers. Though, after few years the bank recovered from this with awareness and after the customers got to know the benefits of the system. The idea of just using CRM technology is not enough, but managers and staff must be integrated into the system by the organization. Because in the early years of the implementation of the system, the bank relied much upon expatriate from outside that were providing support services for them. This brought a setback for the bank initially as the experts sometimes were not available to fix the problems due to other engagement. Though, the bank has overcome this since they have their own specialists who are available 24/7 to resolve any problem in the system. I will also recommend that organizations should be very careful during implementation of the system because the system requires proper strategy formulation. It is also important to know that whatever strategy is adopted, such strategy should be built based on available resources and expected realizable goals. The strategy should be customer centric and not be afraid of initial result putting into cognizance the future benefits of the system for the organization.

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