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Ubiquitous Organization:A New Paradigm for CRM
Presented by:
Rado Kotorov, Ph.D.M. F. Smith & Associated, Inc.
1201 Mt. Kemble Ave.
Morristown, NJ 07960
Tel.: 973-425-4912
Fax: 973-425-0800
E-mail: [email protected]
www.mfsmith.com
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Cost to Snag a Single Sale
Amazon.com $103
Bluefly.com $245
Garden.com (gone) $71
Pets.com (gone) $200
Furniture.com (gone) $500 Shoebuy.com $15Source: Inc. Tech 2001, No. 1, E-Tailing by the Numbers
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Some transactions produce
saving only - InvoicingInvoice delivery
On- line $1.65 Manual $5.00Dispute resolution
E-mail $10.00 Phone $20.00
Fund TransferElectronic $1.90 Check $5.00
FedEx Shipping Charges $20,000 annually
Source: PC World, April 20. Manage Your Invoices Over the Internet, by Jennifer deJong
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Fig. 1
Scale and Scope Effects
1
1
2
2
3
Increased transaction flexibility
Scale
A: Scale Effect
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1
2
2
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Increased transactionflexibility
Scale
New transactions
Fig. 1
Scale and Scope Effects
B: Total effect - increase transaction capabilities
Total effect
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Three Questions ThatConcerned Executives
Ponder What are the emerging
technologies?
How would the emergingtechnologies change customerbehavior?
How would the emergingtechnologies change our socialorganizations?
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Emerging Technologies
(ET) Until 1980 the emerging
technologies were product focused:
The assembly line (Ford) Industrial robots (Fanuc)
The newly emerging technologies,
however, are collaboration andcustomer focused:
KM
e-CRM and predictive-CRM
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How Would ET Change the
Corporation The emerging corporation is ubiquitous.
Many technologies have evolved to
become ubiquitous: The electric motor operates hidden in
almost every appliance
The microchip obscurely controls andmonitors how our appliances perform
Organizations follow the sameevolutionary path.
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The Profound Change In CRM is:Service Everywhere, Everything,
Every-way Anywhere:Multiple channels - personal contact, web,
phone, web phone, etc (Merita Bank, Finland).
beware of channel conflicts (Charles Schwab)
Anytime: On Demand:Have a 360 view of the customer -
needs, preferences, expectations. Manage
information to anticipate and predict customer
changes (AXA Inc.).
beware of privacy issues, dont be obtrusiveness
beware of information overload and confusion
(AT&T).
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It Is Already Happening:
Stock Brokerage A person can access a transaction
processing engine/technology from a
personal computer, PDA, phone, etc. Transactions can be completed from
anywhere, at any time, andinstantaneously.
Service is offered and deliveredcontinuously and unobtrusively ondemand.
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It Is Already Happening:
Kinkos Promotional materials can be uploaded
on a server from anywhere and at
anytime. Promotional materials can be accessed,
modified, printed and deliveredsimultaneously to multiple locations.
Service is offered and deliveredcontinuously and unobtrusively ondemand.
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The Efficiency Paradox
Corporations are designed for growth,and not for the customers.
Horizontal and vertical segmentationincrease productivity, lower prices, butalso make the labyrinth bigger.
Efficiency paradox: It takes less time
produce a product than to service it(mass production), but this is not validformula for products with layered
information services.
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Evolution of CRM
Generation I CRM: 100 Focus on thecustomer - mostly contact data. Customer recognition and low level service
personalization.
Generation II CRM: 360 Degrees view ofthe customer -full descriptive profile. Learn more about the customer and develop
expectations of the customers future needs.
Generation III CRM: Ubiquitousorganization. Be the customers genie.
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Core CRM Concept:100% Focus on the Customer
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Core CRM Concept:360 Degree View of the Customer
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Core CRM Concept:Ubiquitous Organization
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Organizational Changes
Generation I and II do not requireorganizational changes:
Add information technologyAdd analytics and predictive software
Generation III cannot be achieved
without organizational andtechnological transformation.
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External Functional
Overview
CustomerDataFlow
EmergencyServices
Vendor
TransactionFlow
AccessMechanism
ProcessingMechanism
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CRM Organizational
Design Benchmarks The customer-end architecture is a
mirror view of the CEO-end
architecture. A cross-functional process service
layer is added, analogous to thefunctional layer underneath the
CEO, with the purpose to: Design self-service processes.
Broker in real-time services not
handled by a self-service processes.
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CEO/President
Functional Areas (Finance/Planning)
Div 3Div 2Div 1 Div 4EfficiencyLayers
Cross Functional Service Provision
Self-Service Real Time InternalService Brokerage
Self-Service Design
CustomerE
ffectiveness
Layers
CEOV
iew
CustomerView
C
ustomersvie
w
isamirro
rimageofC
EOv
iew
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Business Drivers
The more ubiquitous theorganization, the more desirable its
services become. The more customers demand, the
more diverse needs they express.
The more diverse demands, themore other companies seekalliances and revenue sharing withthe ubiquitous organization.
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CEO/President
Functional Areas (Finance/Planning)
Div 3
Div 1&2
InternalIntegration Div 4
Cross Functional Service Provision
Customer
PartnersAlliance
Revenue SourcesShared Revenue Sources
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Sources of RevenueGrowth
Revenue Growth
SharedRevenue
sGrowth