Theoretical Frame of reference
The purpose of this chapter is to provide the theoretical background to the topic and to demonstrate an understanding of the previous theories and relevant concepts which were related to the broader areas of knowledge. The pertinent research studies related to the theories and the analytic models were reviewed. Thus we found them relevant to the research problem being investigated. It is an essential part of the study as it includes theories based on their appropriateness, explanatory power, and relevance to the study. The chapter also includes the presentation of the research model and the research question.
The process of the review of the literature
According to Easterby, Thorpe, & Jackson (2015), the process of the literature review is seen as a research activity in itself as it requires a wide range of research skills as well as analytical capabilities. To rate the quality and the relevance of our research study, systematic literature reviews will be conducted, and most of the articles that will be used will be peer-reviewed journal articles and academic books.
The study takes into account the researches until 2018 for the review. Considering the purpose of the study that is to evaluate ways through which CRM system could be implemented in the freight industry and to study the challenges related to the integration of this system, data from different sources related to CRM will be collected and we will position the literature review in accordance with the existing knowledge related to the field of CRM implementation and the challenges involved in its integration process. Therefore, to search for the articles, keywords such as “CRM system,” “Implementation of CRM,” “CRM integration challenge,” “Freight forwarder,” and so on, will be used. In addition to that, the literature review will help us to build the analytical framework to understand the previous researches in this area. The aim of the study would also be achieved through the detailed literature review as CRM would be frequently discussed in the paper. Since this study is based on the freight forwarder industry and the implementation of CRM, it cannot be ignored that it would be considered essential from the management point of view. Different perspectives will be taken into account while conducting the review, which would help in further analysis of the study.
For this study, online portals, different databases, and the university online library will be used.
CRM and technology
CRM is a concept that has no clear paradigm. There are many ways through which it is conceptualized. According to Cambra-Fierro, Centeno, Olavarria, and Vazquez-Carrasco, (2017), CRM system is the one that is the combination of the management practices and the software that is developed to serve the customer from placing the order through the delivery and the after-sales services. It should be noted that there is an involvement of the flow of information and energy in two ways that is between the firm and its customers. There are service encounters that could not be separated from the CRM systems if the systems are adequately designed. CRM is that process that helps in compiling the information and in increasing the understanding related to the management of relationships between the organization and the customers (Rababah, Mohd & Ibrahim, 2011). Also, they referred it as the business strategy using the IT to provide the organization with a thoroughly comprehensive, and reliable as well as integrated view of their customer base that helps in processing and maintaining the customer interaction by expanding relationships on mutual benefits.
However, as CRM is studied primarily in technological terms, it involves the integration of several resources in the firm. There are different relationships that require trust and commitment, as well as personal contacts to form service encounters (Paden & Stell, 2005). In this industry, trust is the most integral part as the CRM technology does not only create a bond between the company and the clients. It is dependent on the premise of the developing relationship with the customers as it builds loyalty, which leads to higher profits for the organization. These premises seem to have both conceptual as well as empirical backing, meaning that any small improvement in the rates of customer retention could lead to a significant increase in the profits. In the European region, CRM tries to understand the nature and the impact of long-term relationships in the B2B environment (Paden &Stell, 2005). The aim is to understand the needs of the business customers and analyzing ways to give better value as excellent benefits are provided. In the B2B relationships, information technology is considered as the support mechanisms as well as highly critical (John, 2018). It depends on the industry as for how this is perceived. As this is the case, the technology in the freight industry is an integral part of their CRM system. In particular, information technology includes internet and business intelligence, helping them enable their firms and focus on their customers in depth. They also provide the products and the sales services at different levels 8 that are essential to retaining the customers. In the freight industry, the call center is a critical element in CRM technology. There could be the identification of the call center technology in identifying the incoming calls and matching it to the records of appropriate customers. This automated call distribution system could direct the calls to the departments that are relevant in the organization. One of the most important keys in using CRM is to assure that the customization and the personalization are essential to make the marketing efforts of the carriers (Batista, Dibb, Meadows, Hinton and Analogbei, 2018).
Customer satisfaction and service quality
Customer service is vital for a company’s success, especially in today’s highly competitive global environment. This is evident when the researchers see why papers on customer related theories such as service satisfaction and service quality are prominent in the services literature (Sureshchandar, Rajendran and Anantharaman, 2002). However, it is to be noted that, in what way quality and satisfaction are connected to CRM are not examined in these papers. There is a definite link between the quality of service, service satisfaction, and customer loyalty, as illustrated by the plethora of evidence, which is essential to corporate success. Relationships between customer service constructs have also been investigated in numerous papers in this area. The research efforts were summarized by Cronin, Brady, and Hult (2000) and an empirical model involving customer service structures has been tested. Under this model, quality of service is a precursor of satisfaction that in turn paves the way for behavioral intentions, including’ loyalty, positively talking about the company, recommending the company to other consumers’ and’ spending more with the company.’ The quality of service also has a direct link with the intentions of behavior.
CRM and supply chain
The supply chain in the organization has been considered and recognized as one of the important key business processes across the network of the organizations. It is the integration of the processes of businesses from the end users through the initial suppliers providing all the products, as well as the services and information adding value to the customers and the other stakeholders (Lambert &Enz, 2017). Supply chain management comprises eight key processes in which CRM comes on the top (Marchesini and Alcântara, 2016). The others include the supplier relationship management, customer service management, managing demands, order fulfillment, developing the flow management, developing the products and commercialization, and the returns management. SCM is the entire process that is run across the firm where each department is given a responsibility to be fulfilled (Cambra-Fierro, Centeno, Olavarria, and Vazquez-Carrasco, 2017).
The relationship between SCM and CRM cannot be ignored. CRM is the process in the SCM relating to how the relationships with customers are structured, developed, and maintained. It is a crucial aspect in identifying the customers and the groups that the organizations should be targeting. The teams set by the organizations are customized according to the products and services agreement so that the accounts and segments of the consumers could be met. In CRM, teamwork is an important phenomenon that helps in improving the processes and eliminating the variability of demand as well as the non-value-added activities (Cambra-Fierro, Centeno, Olavarria and Vazquez-Carrasco, 2017).
The Freight forwarding industry
The freight forwarding sector is recognized as a customer-intensive service sector that connects buyers and sellers to create economic value through effective delivery of goods to the customers (Shang & Lu, 2012). About 75 percent of all international shipments apply their use, thus making them an essential link for shippers, serving as a crucial intermediary in the network of global logistics (Anderson, 1993). According to Burkovskis (2008), the term “Freight forwarder” has no standard definition. However, he views Freight forwarders as nothing else but transport architects that provide with services related to consignment on their own or by customer’s name. Their activities include the arrangement of the formalities associated with the carriage of goods on behalf of the consignor, such as booking space on a ship, providing the important documentation and handling customs clearance (Shang & Lu, 2012). They take responsibility for the qualitative and timely delivery of goods (Burkovskis,2008). Their customers include B2B organizations and individuals, all operating in different business sectors.
One of the major advantages of using a Freight forwarder lies in the area of tracking and tracing capabilities available as customers have become more demanding for services that go beyond just moving goods (Anderson, 1993). For example, in the area of intermodal transportation, the owner of the consignment may have a limited experience with processes such as findings and evaluating bids or knowing shipping conditions for different carriers, thus making it quite challenging to deal with all the formalities and all the carriers involved in the transportation process (Gasparik, Zitrický, Abramovic, & David, 2017). Hence the need of a Freight forwarder that has the adequate knowledge about the tax payment, the rules of import and export, and so on (Burkovskis, 2008), and who can support the entire customer process in a single place by providing the customer with all the products, services and information that they require (Gasparik, Zitrický, Abramovic, & David, 2017).
The systems of CRM are the ones that are adapted so that the value of the organization’s customer base could be maximized. As the latest technologies are applied in the system of CRM organizations, there is a streamlined process of business which allows the leverage of every customer interaction. The automation of front-end business processes helps in standardizing the best practices and tasks while leveraging the information of the customers. This refers to saving data and tracking information. As both of these are enabled, the correct implementation and utilization of the CRM systems would help in maximizing the revenue opportunities and create customer loyalty by enhancing the operations that are attached to the customer interface. All these are highly crucial in today’s market.
According to Kostojohn, Johnson, and Paulen (2011), a reliable CRM system is the one that results in an improvement in the operational efficiency of the organization. It helps in examining the customer perspective while making the decisions, developing the processes of the businesses and also adjusting the organizational structures. The system of CRM leads to the finding out the details of the customers facing functions of the business as it centralizes the customer information as well as helps in tracking the sales opportunities, providing business intelligence, analyzing the data and also enabling a highly responsive customer service. The system of CRM can also be referred to as the platform where the entire information related to development, improving, and retaining the customer relationship is stored.
CRM systems have helped organizations in establishing new B2B relationships, which are very costly and require considerable resources than just developing current relationships. There is an increase in both the value as well as the satisfaction of the existing customers. In addition to that, the existing customer base could also be of help in establishing new relationships with the help of positive word-of-mouth. While implementing the CRM system, there is a minimization of the customer relationship costs as well as customer satisfaction while there is the maximization of future potential (Xu and Walton, 2005).
CRM as a business process
The performance reports of CRM are mainly designed to measure the profitability of the individual customers evaluating the overall financial impact on those customers. The process is divided into two areas. The first is the strategic level of the process where the CRM provides the entire framework to the organization to manage the relationships with the customers. This is further divided into five sub-processes (John, 2018). The second one includes the operational process.
Strategic Process of CRM
On the strategic level of the CRM, the first sub-process consists of the reviews of the strategies on the corporate and marketing level so that the customer segments could be identified. Identification of the customers is the key to current organizational success as well as in the future. In the second sub-process, the team identifies the criteria to categorize the customers and to provide the guideline that determines the qualification of the customers for tailored project service automation (Lambert, 2009). The potential criterion on which the customers are segmented and grouped are based on the growth potential, the positioning issues, profitability, market share goals, access to the knowledge of the market, the technological level, strategic capabilities, resource capabilities and the channel of distribution.
The following third sub-process includes the development of the team guidelines related to the degree of differentiation. There is an involvement of the differentiation alternatives considering both the costs and revenue implications. This involves the level to which the customers could be provided with the customized products. The aim is to enhance the profitability of both the firm and the customers Lambert, (2009).
The fourth process is about the development of the metrics framework, which involves outlining the metrics of interests and relating them to the outcome that is the customer’s impact on the organizational profitability and customer’s profitability. The process of CRM is held responsible for assuring that these metrics are used so that there is no conflict in the other processes Lambert, (2009).
1.1 Customer Relationship Management
1.2 Problem discussion
1.3 Purpose of the study
1.4 Structure of the research study
2 Theoretical Frame of Reference
2.1 The process of the review of the literature
2.2 CRM and technology
2.3 CRM system
2.4 CRM as a business process
2.5 CRM implementation
2.6 The life cycle of CRM
2.7 CRM success
2.8 Process framework of CRM
2.9 Conceptual research model and Research question
3.1 Philosophical stance
3.2 Research strategy: Qualitative vs. Quantitative
3.3 Research approach: Inductive vs. Deductive
3.4 Data collection
3.5 Data analysis
3.6 Quality of the study
3.7 Ethical consideration of the empirical study
4 Results and Findings
5.1 Thematic analysis
6.1 Managerial implication
7.1 Research limitations
7.2 Further recommendations
7.3 Theoretical lift
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Investigative analysis of CRM system implementation and the challenges attached to its integration into the existing ERP system From an organization perspective A case study of a Freight Forwarding Company in Sweden