Customer Service Management : Assignment

Customer Service
Management
Table of Contents

INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
Definition of CRM......................................................................................................................1
Overview of CRM model............................................................................................................1
Significance of all the components of model..............................................................................3
Beyond fragmented CRM approaches........................................................................................3
Importance of CRM as a business strategy.................................................................................3
Examples of good practice within tourism sector.......................................................................4
Evaluation of CRM and its long term value................................................................................5
TASK 2............................................................................................................................................5
Immediate and latent benefits of DMO and local enterprises for implementing collaborative
CRM............................................................................................................................................5
Use of CRM software..................................................................................................................7
Unspecified new service and realignment of assets....................................................................7
Examples of good practise of CRM system................................................................................8
CONCLUSION................................................................................................................................8
REFERENCES..............................................................................................................................10

INTRODUCTION
Customer service management is the art of servicing the customers by an organization in
the best possible way. It involves an interaction with the buyers in order to fulfil their needs and
demand (Verma and et. Al., 2012). Apart from this, there are additional activities such as
consider the queries in order to resolve them and maintaining good and healthy relationship with
them. It increases customer satisfaction which leads to higher profit and sales. A company can
develop strategies for catering for managing the customers and their demands efficiently. In this
report, The Ritz London has been chosen which is located in Piccadily, London, United
Kingdom. The report covers definition of CRM, overview of a CRM model, importance of
components, interconnection of CRM business strategy with other units, facts and statistics. In
addition to this, benefit of DMO, opportunities to sell, staff retention, explanation of CRM
software along with realignment of assets to meet customer need.
TASK 1
Definition of CRM
According to Buttle, F, “Customer Relationship Management (CRM) is the core business
strategy that combined internal processes and functions, and external networks, to create and
deliver value to targeted customers at a profit. It is grounded on high quality customer related
data and support by information technology.”
According to Wimshurst & Mackay, “CRM can be further defined as a complete set of
activities covering all the functions of the organization, relating with and supporting a consumer.
Such activities build customer satisfaction by way of providing to their needs, and want over a
long period of time.”
There are many other definitions which have focused on CRM as technology driven part
or strategy which helps in increasing the satisfaction of the customers (Payne, 2012).
Overview of CRM model
CRM models have bee developed to manage the customers efficiently by understanding
the basics of CRM. It improves the relationship current as well as potential customers by
analysing data about the past records of customers available with the company with an intention
to improve business relationships. The CRM model chosen for The Ritz London is mentioned
below:
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IDIC model of CRM- This model was developed by Peppers and Rogers in the year 1995
which can be applied by variety of entities for attaining the goals related to customers. The main
aim of this model is to identify the expectation of customers and assess their value to the
business (Saarijärvi, Karjaluoto and Kuusela, 2013). IDIC is the abbreviated form in which I
stands for identity, D stands for differentiate, I means interaction and C defines customise. These
are the stages of IDIC model which have their individual working and importance. These have
been elaborated below in detail: Identify expectations of the customers- This is the beginning of the whole process which
starts with identification of the needs, taste, choices and preferences of both existing and
prospective customers. The Ritz London can conduct as survey to assess the number of
clients who have demands to stay in 5star hotels. By this, it can target those customers
and give them preference over others. Differentiate customer expectations- This is about distinguishing between all the
customers on the basis of value and need. The former is crucial to focus on those clients
who have availing the services from a long time and are indeed very loyal to the
organization. On the other hand, the customers falling in the category of need requires
promotion by which they can be attracted and make loyal customers. Management of The
Ritz London can form strategies which help it focusing on the loyal clients. Also, it can
have feedbacks from such people in order to make improvements in the current services. Customer interaction- Interaction is vital in having an understanding or uncovering the
expectations of the customers (Nies and et. Al., 2014). It is directly related to the
products or services of an entity. It can be done through number of ways such as
feedbacks in order to get the honest opinions which can be used to form strategies so that
customers can get higher satisfaction. The Ritz London can have feedbacks from all the
clients in order to make the services customer-oriented.
 Customizations to meet customer expectations- Once the above steps are fulfilled, an
organization can make changes in the products or services according to the requirements
of the customers. Also, companies can build new strategies focusing on customizations.
For instance, The Ritz London can make strategic decisions which can enable it to make
major modifications in the existing services so that more customers can be attracted to
avail the services.
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Significance of all the components of model
A CRM model has variety of components which is essential for efficient working of
CRM system. In the chosen CRM model IDIC, there are different stages which can be termed as
components. These are interdependent of each other and there is a connection between all the
elements (Luck and Lancaster, 2013). Each of them should work in a co-ordinated form for
implementing the CRM successfully. For example, on the application of IDIC model in The Ritz
London, the hotel cannot make differentiation between the customers without identifying their
expectations. Hence, in order to make business strategy in CRM, all the components of a model
in vital.
Beyond fragmented CRM approaches
Fragmented CRM approach means where each units or functional group implements their
own CRM without depending on other department. There is no common or uniform vision or
strategy. This approach is very limited which may not be successful all the time. However, there
are integrated approach as well which is opposite to the one described above. In this, a common
system together with vision exist in the entity which is made according the main goals and
objectives. Generally, the business strategy is made the target by considering which integrated
approach is implemented.
The choices and preferences of customers keep changing quiet often which increases the
need to implement fragmented CRM approach. This enables the organization to develop new
strategies in every unit so that multidimensional needs can be fulfilled. Customers have different
requirements which is not possible to meet with integrated approach. Hence, The Ritz London
can apply this approach to cater the different needs of customers.
Importance of CRM as a business strategy
CRM is basically a system which ensures that customers are getting the right products or
services which are capable enough to fulfil their needs and provide higher satisfaction. However,
it can be implemented as a business strategy which put the customers at the center of a business.
In other words, organizations can make this as a part of business strategy for increasing the value
of the business by creating lifetime relations (Chung and et. Al., 2012). As a business strategy,
CRM helps a company stay focused on delivering the best services and products to the
appropriate target customer. It enhances the interaction with the clients. Furthermore, it covers
all the areas or aspects such as marketing, sales or production related. These units carry functions
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associated with sales, marketing and customer service as well as focus on producing new
products. Apart from this, when CRM as a business strategy can meet its objectives efficiently. It
helps in identifying and target the profitable customers, better sales management, personalisation
relationships with customers, providing employees with information regarding customers.
Examples of good practice within tourism sector
Tourism sector in UK is growing rapidly as many hotels have been built in the past few
years. Also, there are hotels which have expanded and increased their services (Verma and et. al.,
2012). In these kinds of entities, it is important to have good customer relations. Therefore, some
of the examples of good CRM practice are as follows:
 Loyalty programs- There are large hotels which have started loyalty programs
for their customers to reward the loyal guests. In this program, guests are given
points every time they check into the hotel.
Fig 1. Top 10 Loyalty programs
 Welcome award- It is a program which is for the frequent guests visiting the hotels. In
this program, customer is identified as business traveller in which it award such guests by
forming collaboration with travel partners.
 Customised services- There are customers who wish to have specific needs additional to
the basic needs. This helps in building strong relationships with the guests as they can
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expect particular services according to their wish. For example, some of the UK hotels
are providing boutique rooms which are designed as per the specifications provided by
the guest.
Evaluation of CRM and its long term value
CRM has prime objective which is to build good relations with customers by meeting
their expectations (Coelho and Henseler, 2012). There are large number of hotels which have
prime objective to provide high satisfaction to its clients. It has direct impact on the long term
retention of the guests. Tourism sector is very competitive which makes it necessary for the
entities to focus on the expectations of their customers. CRM system helps hotels in building
strategies by which it can make plans to make changes in the services. This leads to creation of
long term value for the hotel. For example, The Ritz London may develop loyalty programs in
order to reward its customers who avail the services on a repetitive basis. In this way, it can
retain them for a long time resulting in appreciated brand image which direct impact the long
term value in a positive way.
TASK 2
Immediate and latent benefits of DMO and local enterprises for implementing collaborative
CRM
UK is the chosen tourism destination which comprises of variety of local as well as
international hotels operating in this sector. Every such enterprise applies CRM to understand the
needs of the customers in a better way to fulfil their expectations. DMO means Destination
Marketing Organization which represents the destinations and help develop their long-term
travel and tourism strategy (Nitu, Tileaga and Ionescu, 2014). On the other hand, local
enterprises are the entities which have operations within UK only having the business of forming
the strategies. Collaborative CRM refers to an approach which focuses on all the units of the
company such as sales, marketing, technical support etc. for better interaction with the
customers. Some of the benefits of DMO and local enterprises implementing collaborative CRM
are as follows: Identification of potential guests- These organizations is responsible in increasing the
awareness about the services and offers made by the hotels which has appointed them. It
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advertises on behalf of the partnered hotel to make the guests aware about discounts
which are available by the hotels and local attractions. Help in making strategic decisions- DMO and local enterprises make decisions by
focusing into the marketing plans of hotels. They provide statistical data on their official
websites showing visitor profiles, annual reports, economic updates, tourism summit
results etc (BARCOE and WHELAN, 2018). These information are important which is
used by the customers before booking the hotels. Information about local economic development plans- Hotels can have the information
about the local economic development plans so that it can make changes in the strategies
used for business. It has direct impact on the demographics of the audience which are
being targetted by the hotels. Social media- DMO/local enterprise considered that social media can provide a great
platform for making the customers believe the information put by them on the websites.
Since, large number of transactions are done digitally, it can help them providing all the
information on the internet which can be made a part of social media campaigns. Enhance cross sell and up sell opportunities- Cross-selling refers to invitation to
customers to buy related or complementary items. On the other hand, up-selling is the
practice of influencing the customers to acquire premium or higher-end product. DMO
and local enterprises help in attracting the customers to consider the offers of acquisition.
They provide specifications which may encourage the customers to buy luxurious as well
as complementary products or services (Kolas, and et. al., 2015). Acquiring new customers- Customers are important for making profit, fight the intense
competition and survive for a long term in the industry. The main purpose of
collaborative CRM is to present the information about the hotel in such a way which will
impact the choices of the customers. DMO and local enterprises target the clients by
segregating them. Furthermore, it try to attract new customers who are willing to pay for
the hotel services in UK.
 Staff retention- With the collaborative CRM, the information about the customer are co-
ordinated with different departments such as sales, marketing etc. In this way, the burden
gets reduced which ultimately helps in retaining the employees for a long time.
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Use of CRM software
CRM software or CRM system is software for business which is independent of type,
size and nature. In this, all the information about customers can be stored in the record which
may help in making strategies to be implemented in the business for higher satisfaction to the
guests. However, there can be changes in the software according to the requirements of the
hotels which can fulfil its objectives (Venturini and Benito, 2015).
By applying the IDIC model of CRM system which can help creating body of
information which will increase the value proposition for a particular client. The IDIC model
begin with identification of expectations of customers which can be ascertained by asking the
specific guests number of questions regarding the services which are expected. After this, the
expectations are divided into two categories which are the needs and which can create value.
This increases the efficiency of putting the right service within the right amount which can
provide high perceived value. Furthermore, interacting with the customers is the next step in
which opinions from a specific customer is obtained so that more improvisation can be done.
Lastly, the services are customised on the basis of all the available information. In this way, the
information stored in the database of CRM system, the value proposition ca be enhanced.
Unspecified new service and realignment of assets
From the use of CRM approach the management could effectively develop tourism
services by forecasting need of consumer from the instant feedback that are been given them on
the portal. The services may vary from perception of different consumer. Then after the
supervisor should focus on attracting potential tourist towards the organisation. The company
can increase profit margin by providing various special offers through discounts while booking
ticket from partnership trip agencies. It will help in gaining profit margin in tourism industries.
Thereafter result in securing personal information of consumer which will improve customer
relationship base. It is necessary that there should be cordial relation between the employee, so
that there would be minimal chances of conflicts in an organisation. Henceforth it help manager
to create loyalty towards the brand in tourism industry. Also it will help in generating more
revenue of the hotel in market.
Examples of good practise of CRM system
The customer relationship management is considered to be cost effective system that help
in gaining competitive advantage in any industries. A CRM is software based system used for
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maintaining cordial and fruitful relations with primal and existing consumer in tourism sector.
In tourism industries, every organisations follows different techniques in facilitating their
customers. The CRM has unique features like automated client follow-up and business
workflow, attracting potential consumer to website, cloud CRM, mobile CRM, productive
document management and invoicing and centralised database. Some of these examples are
described under beneath:
Automated client follow-up: It is necessary to take feedbacks from clients who have
visited and prevail the services offered by management of hotel. The management should
encourage the work force to communicate with customer. These goals could be achieved through
effective communications through various mediums like e-mail, telephonic calls, video
conferencing and many more. The main objective of using this approach is to retain customer
and improve profit margin in competitive market..
Business Workflow: It is necessary that leader should effectively manage employee and
timely update the software so that online user could effectively visit the website of hotel. Also
gain more knowledge about the offers that hotel is offering to them. For planning strategies the
manager could use effective software for analysis business performance.
Document Management: The leader could use online software super office CRM for
managing contacts, project, sales and other information which is effective for the management.
The IT department play an essential role in development of such softwares. Also help marketing
team to grab attention of customer base towards the hotels (Taylor and et. al., 2013).
Centralise customer database: In this database all information about primal and
existing client are been stored by the management. It will help leaders to contact with customer
when some sales offers are introduced in the market.
CONCLUSION
From the above assignment, it is concluded that customer service management plays an
important role in business which is beneficial for both customer as well as the organisation
which helps in effective working in business. It also considers all different needs, approaches and
components of effective model for successful CRM technique. In addition to this, the
management also consider importance and explains specified examples of good practices with in
tourism sector with their facts & statistics in this. Along with this it also includes effective
benefits of DMO & local enterprise which enhance cross and up sell opportunities for acquiring
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new customers and also staff retention as well as daily business activities. It also uses CRM
software's effectively which creates Cohesive and coherent information and relies on assets to
meet the customer need effectively and efficiently.
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REFERENCES
Books & Journals:
Verma, R., and et. Al., 2012. Customer experience modeling: from customer experience to
service design. Journal of Service management.
Payne, A., 2012. Handbook of CRM. Routledge.
Saarijärvi, H., Karjaluoto, H. and Kuusela, H., 2013. Extending customer relationship
management: from empowering firms to empowering customers. Journal of Systems
and Information Technology. 15(2). pp.140-158.
Nies, J.G., and et. Al., 2014. Predictive Modeling from Customer Interaction Analysis. U.S.
Patent Application 14/083,772.
Luck, D. and Lancaster, G., 2013. The significance of CRM to the strategies of hotel
companies. Worldwide hospitality and tourism themes. 5(1). pp.55-66.
Chung, Y.C., and et. Al., 2012. The correlation between business strategy, information
technology, organisational culture, implementation of CRM, and business performance
in a high-tech industry. South African Journal of Industrial Engineering. 23(2). pp.1-15.
Verma, R.,and et. al., 2012. Customer co‐creation in service innovation: a matter of
communication?. Journal of service management.
Coelho, P.S. and Henseler, J., 2012. Creating customer loyalty through service
customization. European Journal of Marketing. 46(3/4). pp.331-356.
Nitu, C.V., Tileaga, C. and Ionescu, A., 2014. Evolution of CRM in SCRM. Economics,
Management and Financial Markets. 9(1). p.303.
BARCOE, C. and WHELAN, G., 2018. A proposed framework for measuring the effectiveness
of social media: A study of irish tourism. WIT Transactions on Ecology and the
Environment. 227. pp.151-161.
Kolas, N., Höpken, W., Fuchs, M. and Lexhagen, M., 2015. Information gathering by ubiquitous
services for CRM in tourism destinations: an explorative study from Sweden.
In Information and Communication Technologies in Tourism 2015(pp. 73-86). Springer,
Cham.
Venturini, W.T. and Benito, Ó.G., 2015. CRM software success: a proposed performance
measurement scale. Journal of Knowledge Management. 19(4). pp.856-875.
Taylor, J., and et. al., 2013. Customer relationship management system and method. U.S. Patent
8,489,543.
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