1.

INTRODUCTION
CRM stands for Customer Relationship

Management. It is a process or methodology used to learn more about customers' needs and behaviors in order to develop stronger relationships with them. There are many technological components to CRM, but thinking about CRM in primarily technological terms is a mistake. The more useful way to think about CRM is as a process that will help bring together lots of pieces of information about customers, sales, marketing effectiveness, responsiveness and market trends. CRM helps businesses use technology and human resources to gain insight into the behavior of customers and the value of those customers. Customer relationship management (CRM)

consists of the processes a company uses to track and organize its contacts with its current and prospective customers. CRM software is used to support these processes; information about customers and customer interactions can be entered, stored and accessed by employees in different company departments. Typical CRM goals are to improve services provided to customers, and to use customer contact information for targeted marketing.

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While the term CRM generally refers to a softwarebased approach to handling customer relationships, most CRM software vendors stress that a successful CRM effort requires a holistic approach. CRM initiatives often fail because implementation was limited to software installation, without providing the context, support and understanding for employees to learn, and take full advantage of the information systems.CRM can be implemented without major investments in software, but software is often necessary to explore the full benefits of a CRM strategy. Other problems occur when failing to think of sales as the output of a process that itself needs to be studied and taken into account when planning automation. Bank or life assurance is a contract between the policy owner and the insurer, where the insurer agrees to pay a sum of money upon the occurrence of the insured individual's or individuals' death or other event, such as terminal illness or critical illness. In return, the policy owner agrees to pay a stipulated amount called a premium at regular intervals or in lump sums. As with most bank policies, bank is a contract between the insurer and the policy owner event occurs which is covered by the policy.
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whereby a

benefit is paid to the designated beneficiaries if an insured

The value for the policyholder is derived, not from an actual claim event, rather it is the value derived from the 'peace of mind' experienced by the policyholder, due to the negating of adverse financial consequences caused by the death of the Life Assured. Bank is a complex product where personalized serviceachieved through an intimate knowledge of customers and their histories with an bank companyis critical to making sales. As bank options broaden and products grow more complex, customers seek superior, personalized service more than ever. With the repeal of the Glass-Steagal Act in 1999, bank companies face increased competition from banks and brokerages. With the enactment of the Patriot Act, bank companies need to ensure that they "know their customers." The situation grows even more urgent when one considers the bad economy that hurts investment income; as well as the extremely narrow window of time wherein an bank call center representative, agent or broker holds a customer's attentionand a valuable opportunity to cross-sell or up sell. It is at this precise moment that these individuals have the chance to opportunities. maximize these fleeting sales

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2. CONCEPT OF CRM
The two points of the concept are:

Understand your customers' unique requirements. Offer them the services and products over their lifetime that will maintain or increase their profitability and retain them as your-customers. These supporting strategies generally fall into three groupings: analytical, marketing and operational. The analytical path focuses on mining the data you have on your existing customers, and marrying that data with external data when possible to develop a scoring index. This index can then be reliably applied to individual customers to indicate their level of profitability, tendency to remain a customer, and propensity to acquire other products and services. At its simplest level this analysis might move your view of existing customers into one of four following segments: Low Profit / High Retention High Profit / High Retention Low Profit / Low Retention High Profit / Low Retention

The second supporting strategy centers around marketing and the design of effective programs that
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will enhance your customer relationships based on their unique requirements. In many companies, this strategy represents a different marketing focus than the traditional one of new customer acquisition. A plan for the High Profit/High Retention customers, for example, might focus on retaining customers, crossselling them specific services and insulating them from competition. In contrast, a plan for the Low Profit/Low Retention customers might be low maintenance with heavy emphasis on self-service.

E-CRM:E-CRM refers to the set of activities that enable a firm to utilize the power of the Internet and the electronic medium to implement CRM. Firms all around the world have realized the potential of the Internet as a medium for CRM and have been actively pursuing E-CRM strategies. The following statistics highlight the importance and potential of the e-CRM industry.

General Motors (GM) receives about 100,000 emails from it customers, every day.

The volume of customer related email traffic is so much that almost 42% of the queries never get answered by the companies.

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The Gartner group estimates that as of October 99, about 90% of the firms are not equipped to handle customer e-mail with a probability of 0.9

A complete E-CRM architecture would comprise of the following components: 1. 2. 3. 4. 5. 6. Sales Force Automation (SFA) E-Mail Management System (EMS) Interactive Voice Response (IVR) Knowledge Management (KM) Call Centers Instant online querying through Chat

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3. CUSTOMER RELATIONSHIP LIFE CYCLE

Customer Relationship Management facilitates

closed-loop customer interactions through all phases of the customer relationship life cycle, including:

1. Customer Engagement

2. Business Transaction

Marketing and Management

Planning Campaign

Order Acquisition Internet Pricing and

Configuration and

Telemarketing Lead Generation

E-Selling Telesales Field Sales Profitability Analysis One Step Buying and Selling

Opportunity Management

Sales

Activity

and

Contact Management

Customer Segmentation, Product, Profiling and Service

Collaborative Management

Content

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3. Order Fulfillment
Complete Order Life

4. Customer Service

Interaction Center Internet Customer SelfService

Cycle Process Real-Time Checks Contract, Billing, and Financials Management Fulfillment Visibility Availability

Service Management Claims Management Field Service -- Mobile Service

Field Dispatch

Service

and Order Tracking

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4. KEY REQUIREMENTS FOR CRM IN BANK

Some of the functional and technical requirements for CRM solutions are as described below:

Business Capabilities

Intelligence

and

Analytical

A CRM application contains vast amounts of information that pertain to an organizations customers and prospects. This information needs to be leveraged and analyzed by decision makers so that they can make more informed and timely business decisions. This is possible only if CRM solutions have robust business intelligence and analytical capabilities. This is a major requirement primarily for marketing applications.

Unified Channels of Customer Interaction involves not only integrating channels the so functional that the

This

components of CRM solution but also integrating these components efficient. across multiple customer interaction can be seamless, consistent and

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Web-based Functionality Support

Web-based functionality is essential for applications such as web self-service and unassisted sales. Web is also a critical channel for e-business and is also important from an infrastructure perspective. Users of CRM applications require access to their applications, which is supported via standard web-browsers. Moreover business logic and data are maintained centrally, thus facilitating the deployment, maintenance, and upgrading of applications.

Centralized Information

Repository

for

Customer

CRM solutions should work from a centralized repository so that current customer information is available in realtime to all customer-facing employees.

Integrated Workflow

CRM solutions should have a strong workflow engine to ensure that cross-functional tasks can be accomplished as dynamically and seamlessly as possible.

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5. CRM & TECHNOLOGY

The Internet has really opened up the prospects for one to one marketing on a global scale. Today several

technologies are helping the ever-busy consumer obtain more targeted assistance than ever before. The idea of mass customization is at the heart of Customer

Relationship Management. Every CEO out there realizes or is in the process of realizing the importance of customer needs to their business, and never before have their options been so diverse. There are such things as intelligent agents, learning agents, negotiation agents, chat rooms, FAQs pages, personalized web pages, help desks, call centers, and, as we are all aware, automated emails and automated response systems. Today's CEO is bound to be a bit overwhelmed by his or her options with respect to Customer Relationship Management. In fact, the options available are so

astounding, that several companies specialize in customer relationship management alone. However, there is some basic theory upon which all of the different software
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packages offered by all of these companies are founded: customer loyalty, trust, and referrals. Loyalty is basically self-explanatory, and it is the single most significant contributor to profitability. "Customer loyalty, measured

in repeat purchases and referrals, is the key driver of profitability for online businesses, even more so than for offline companies, according to a series of joint studies in online retail by Bain & Company and Mainspring. For

example, in apparel, the average repeat customer spent 67 percent more overall in the third year of his or her shopping relationship with an online retail vendor than in the first six months. And, over three years, customers referred by online grocery shoppers spent an additional 75 percent of what the original shopper spent." (Mind spring) "The study also found that the average online apparel shopper was not profitable for the retailer until he or she had shopped at the site four times. This implies that the retailer has to retain the customer for 12 months in order to break even.

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6. NEED & OBJECTIVES OF CRM

Need for CRM in Bank Sector

Bank CRM decreases the time required to make product changes

A holistic integrated customer view Targeted marketing Customer retention Increased growth Increased policy sales Increased bank market share CRM Bank integrates marketing with other operations Efficient distribution channels are secured CRM provides the chance to reduce operating expenses

It provides for more effective and efficient communication

It improves the response time It increases customers satisfaction Bank application queries/ claim status queries can be answered sooner

It reduces the time that is normally taken for printing

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BANK BUSINESS OBJECTIVES FROM CRM: The following are some of the strategic objectives offered by the Sales Applications in the CRM suite:

Increased Revenue your sales force on increasing your

Focus

companys revenues through better Information and better incentives to drive top line growth. Through a CRM integrated solution, sales reps can access and share account and contact management information throughout the enterprise, facilitating team selling that will lead to closing more deals, faster. It also allows sales reps to effectively target their selling efforts to focus on high-value deals and meet revenue targets.

Closed-Loop Marketing

Improve marketing management and programs with a comprehensive marketing system that supports planning, campaign management, execution, Internet support and analysis. Marketing Applications automates the entire marketing process from demand creation to revenue recognition. Designed specifically for marketing professionals, the application automatically collects campaign results and tracks campaign effectiveness across different sales channels, by market segments, and even individual
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customer results. This level of detail enables marketers to reduce costs while increasing the effectiveness of their marketing efforts.

Better Information for Better Management

Implement highly focused, targeted campaigns with better returns on your marketing investments. Marketing applications are tightly integrated with the other applications of the CRM suite as well as the ERP applications. This integration enables marketers to tap into the wealth of data collected through every customer "touch" with their company whether through field sales, a call center, or the Web. Without a dependence on simple demographics, marketers will be able to profile customers based on any number of criteria including sales cycle, payment preference, and purchase frequency, to tailor messages and campaigns with better accuracy for highly focused, individualized marketing campaigns.

Expand Marketing Channels Through the Web

Utilize the power of the Internet to increase your marketing reach and effectiveness. In addition to supporting traditional marketing and

demand creation channels such as direct mail and tele-business, many vendors are enhancing the integrated closed-loop
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marketing application through relationships with several strategic third-party vendors. The combination of these applications will expand the automation of the marketing planning and execution process over multiple deployment channels and sales models, specifically through the Web. By leveraging the Web as a channel, Marketing applications will help companies capitalize on this rapidly expanding opportunity to reach a larger audience with their marketing campaigns. The objectives for Service Applications offered by a CRM suite are as follows

Service Increases Profitability a profit center out of your and service customer

Create

organization revenues.

using

operational

information to reduce costs and generate more

Service application enables organizations to reduce costs by providing a comprehensive closed loop support and service information management system. Its comprehensive resource management capabilities enable organizations route the calls to the right agent to reduce call resolution time. Its enterprise wide customer management ability enables you to reduce billing time with built-in integration between contracts, warranties, resource usage and the billing system. Further, with interfaces to customer care, organizations can track total
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customer contact history to increase customer knowledge and reduce redundancies and resolution time. Fast parts rotation enables reduced inventory levels and therefore, reduced costs.

Service

Helps

organizations

to

Delight

Customers Provide customer loyalty. With an end-to-end Customer Care and Service Solution, Organizations can achieve a full 360-degree view of their customer. This translates into better response to customer's needs; an ability to extend proactive customer management programs as well as has the information at your disposal to better understand the customer. Service applications also track all product defect information, which enables organizations to proactively manage customer issues, so that they are well informed and can also accurately inform customers of service issues. The built-in self-learning knowledge base enables companies to leverage employee knowledge and achieve skills transfer, increasing employee retention and reducing customer churn. Additionally, Service Applications enables organizations customers to communicate with the
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enhanced

customer

care,

service across

and your

information

management

organization to improve customer satisfaction and

company though many different venues, web, call centers, and directly with Field Representatives, offering customers

flexibility in interacting with the company. This integrated customer contact capability ensures that the organizations customers receive consistent service and information, thus reduce his need to turn to one of the competitors for new products or services.

Service Helps organizations Differentiate their Product

Distinguish

business with

by

offering

service full

as

differentiator communications

using

multiple

channel enterprise

customers,

wide view of customer information. As products become commodities, the next purchase decision customers make is increasingly based on either the quality of service or the perceived care they receive from the company. Service Applications by enabling both improved product service, and customer care, help organizations provide their customers with a positive experience in dealing with the company, maximizing the likelihood of additional product purchases.

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7. Implementation & Strategies of CRM

in Bank
Before embarking on a CRM implementation insurers need to: 1. Understand prospective policy holder requirements 2. Understand what products and services will retain them and increase profitability

It is imperative that the objective behind the implementation is clearly spelt out and understood. Without this it is almost impossible to proceed further. Clarity of objectives both CRM and general organizational goals is mandatory for Bank CRM success. It is only against this that the actual results are marked. Goals although varying from company to company should be realistic and benefit the firm in the log run. Establishment of these goals has to be done after excessive scrutiny of company requirements. The more clearly defined objectives are the more chance your CRM implementation has of succeeding.

Organizations need to understand that the bank CRM implementation is not merely about technology. CRM encompasses far more than mere technology and transcends to the customer as well. Organizations need to assimilate the fact that it is a combination of
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people, processes and technology. Obliterating this fact will surely hamper the process.

Making

the

customer

the

focal

point

and

understanding that it is about meeting their needs will go a long way in ensuring success.

It is imperative that the entire organization realizes the importance of the implantation and endorse it. It requires approval not only from top management but individual employees as well need to give their support Staff need to accept the fact that this will do them good and willingly give off their best customer support effort.

Implementing in phases is always easier and far less time consuming as well as being cost advantageous. There are always added advantageous when the implementation is done in stages rather than as a onetime plan. It facilitates the easy involvement of resources when done on a short term basis, and makes easy the constant monitoring of results so that corrective measures can be taken.

Adequate metrics need to be established if the organization wants to succeed at its CRM bank implementation. benchmark measured. Without this there will be can no be against which performance

It is imperative to train staff adequately in order to ensure that they are equipped to deal with the CRM
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implementation. It is essential to have productive staff in order to better customer service. Inexperienced staff will undoubtedly give wrong responses to questions and yield wrong customer service. It is important to see that staff maintains proper customer service. Training staff is thus essential.

CRM manages to put the bank company in a position where it is able to let staff know which customers are likely to leave and move to competitors. This helps staff take the required steps to stop this from happening and prevents the loss of Valuable policy holders.

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STRATEGIES OF CRM Strategy Several CRM software packages are available, and they vary in their approach to CRM. However, as mentioned above, CRM is not just a technology but rather a comprehensive, includes customer-centric and approach to an organization's philosophy of dealing with its customers. This policies processes, front-of-house
customer service, employee training, marketing, systems

and information management. Hence, it is important that any CRM implementation considerations stretch beyond technology requirements. The objectives of a CRM strategy must consider a companys specific situation and its customers' needs and expectations. Information gained through CRM initiatives can support the development of marketing strategy by developing the organization's knowledge in areas such as identifying
retention,

toward

the

broader

organizational

customer improving

segments, product

improving offerings

customer better

(by

understanding customer needs), and by identifying the organization's most profitable customers.

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CRM strategies can vary in size, complexity, and scope. Some companies consider a CRM strategy only to focus on the management of a team of salespeople. However, other CRM strategies can cover customer interaction across the entire organization. Many commercial CRM software packages provide features that serve the sales, marketing, event management, project management, and finance industries. From this perspective, CRM has for some time been seen to play an important role in many sales process engineering efforts.

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8. CRM IN BANK: THE NEW MANTRA

Today in the era of cutthroat competition in the bank sector it is hard for the organizations to survive with their traditional strategy of selling. They need to be customer centric. We have seen the decline of the market share of LIC (it recently went down below 80%) because of its large size and its inability to change. Todays customer has a wide range of choices and he would opt for those that provide him, not the better, but the best service. So, to the customer centric and maintain loyal customer based, it is must that the organization should focus on CRM strategies and inculcate a culture of being customer friendly not just in words but also in practice. With the increase in the number of bank players in the market and consumers becoming more and more aware of different products, insurers have realized the importance of CRM. CRM has been practiced for decades now, the grocery shopkeeper near our home, the paanwala etc all of them have been practicing it In todays competitive era, where customer is the king, it is a must for insurers to not only make new clients but also maintain the existing customers and encourage repeat purchase. It is estimated that the cost of attracting a new customer is five times more than that incurred to make an existing customer happy.
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9. BENEFITS & CHALLENGES Benefits

1. Reduction in the cost of customer contacts. 2. Profitable and sustainable revenue growth. Provide the scalability and flexibility demanded by ebusiness (The unique ability to handle both the high volumes and data intensity associated with enterprise use and the high transaction rates and random usage peaks associated with internet use). Provide both dramatic improvements in the speed and ease of deployments and a true blended application for customer care. Help companies deliver the same consistent,

personalized, high-quality service across all interactions and all communication channels: web, email, chat, voice over IP, phone and fax. Help companies communicate with customers on a one-to-one basis across the many diverse channels, capture data from all customers, and interpret customer information into strategic business intelligence and apply it across operations to better serve customer needs.

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CHALLENGES AND SOLUTIONS Business Challenges: Service is perhaps the last remaining way for a business to effectively differentiate itself. Effective service involves managing each the each customer interaction wants, to ensure a consistent experience and an outcome that is in line with individual business customers from a needs, with and that expectationsas well as being in line with the economics desires relationship customer. The customer experience should also be consistent across all interaction channels (such as the Internet, email, telephone, web-chat, fax, etc.) and across all areas of the company a customer interacts with (sales, service, marketing, etc.). Delivering these consistent focused experiences and over time builds customer sales and satisfaction profitability. Solution:

loyalty

that

increases

Identify a unique situation of a customer;  Prescribe rules on how to treat and influence that situation; Execute those rules consistently across all contact channels; Measure the effectiveness of the program on that unique situation.

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The Technology Challenges: Truly effective E-CRM solutions involve complex and

architectures,

time-consuming

product

selection

acquisition, and integration challenges to existing and future investments. For example, todays multi-channel solution involves email routing, web-chat, webcollaboration, web personalization, intelligent call routing and contact management, to name just a few. Products providing these capabilities take significant research and skill to integrate, implement, maintain, and continuously upgrade when you consider the software, servers, database, hardware, and telephone switches involved. Plus, with new technology being developed every day, its very difficult to remain on the leading edge, while continuously researching how new technologies will complement and coexist with an existing architecture.

The Operational Challenges: Businesses typically focus most of their energy and investment on management resources to develop the required marketing and customer influence programs, and the staff resources to execute those programs. For competitive advantage, both these investments should typically remain in-house and strategic to the business. The retention of key staff resources to communicate with your customer base is a vital issue. A business has to consider many things as it enters new markets, grows in
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an existing market, and attempts to retain its key personnel who interact with customers. A multi-channel ECRM solution involves many players, including support skills for the products involved, and any outside guidance and direction from integrators, product companies, and management consultants. This operating complexity can cause problems in four distinct areas: 1. Accountabilityfrustration due to vendor fingerpointing when technical problems surface because of the growing number of product vendors involved in a solution. Businesses struggle to identify who is on point to manage the complete operation, not just one or two elements of the solution. 2. Personneldifficulty in attracting, training, and retaining the key skills to operate, change, and enhance the supporting technologies. Maintaining and operating the technology requires a different mind-set than the individuals who utilize their technical skills to develop and create the initial solution. 3. Business change managementthe inability to effectively add capacity and the natural human apprehension to change from an existing environment. Understanding when the solution will require the next wave of investment, and that impact on all levels of people resources using the E-CRM solution. 4. Technical change managementdifficulty in
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properly staging, testing, and designing changes to the

technical solution and architecture. Adding technical capabilities requires a unique discipline and management focus to reassure the business that the new change will have little-to-no business interruption. Most businesses have not yet placed management attention to this very key issue. Since the technical world changes so rapidly, this must become part of the operating and management culture of a business.

The Financial Challenges: The categories of investment required creating, operating, and maintaining E-CRM solutions are: 1. Production hardware and software; 2. Labor expenseoperating staff expense to support, change, and upgrade the business use of the technology solution; 3. Test and staging hardware and software; 4. Maintenance environments; 5. IT research and development expenseto assess new enabling technologies in customer service management and their impact on the Current or planned business requirements. expenseproduction and test

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10. CONCLUSION
customer satisfaction and maximize your

Maximize

bottom line. Over the last decade, too many organizations have assumed that their products or services were so superior that customers would automatically keep coming back for more. But in order to compete effectively in todays marketplace, organizations must change their strategy to become more customer focused, not product focused. Customer Relationship Management (CRM) is the best way to integrate this customer-facing approach throughout an organization. Aimed at understanding and anticipating the needs people, of an organizations and current to by and potential an customers, this innovative book shows how CRM links process, technology profits optimize first enterprises revenue and providing

maximum customer satisfaction. Covers developing a market-oriented strategy, innovation in products and services, sales and channels transformation, customer care. customer relationship marketing, and

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11. BIBLIOGRAPHY

Websites:
www.google.co.in www.wikipedia.com

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