CRM and E-Business Connection

Carol Smalley
Managing Editor, CRMGuru
Member

Posted 07-Oct-2003 09:04 AM
Posted by Carol Smalley (Editor) on behalf of Brian Tang [brian36k@yahoo.co.uk]

What is the connection between CRM and e-business? Is one part of another? Do they exist together or independently?

Carol Parenzan Smalley
Managing Editor
www.CRMGuru.com
carol@CRMGuru.com

Helmar
Member

Posted 13-Oct-2003 12:21 AM
In my opinion, the connection exists insofar as one part of reaching the customer is via electronic means—be it an end user or a large corporate. As "e-business" doesn't operate by itself and automagically, but still needs human interaction, it's bound to fall within the realm of CRM. CRM's role in e-business is to gather feedback on the process itself, and improve/adjust it to such an extent that it provides the maximum use and benefit to the customer.

Taking my Diamond-CRM model as a point of reference, e-business would be placed on the "triangle connector" between "Skills", "Service" and "Systems".

Answering the last two questions:
1) Yes, e-business is part of CRM, but some may argue that there is an overlap rather than an inclusion. If you regard CRM as an holistic business philosophy/concept rather than some piece of technology, then e-business is included in CRM (hence the reference to my Diamond-CRM model), rather than floating somewhat outside it all.

2) This questions pretty much answers itself. No, they don't exist together independently, because e-business continuously needs input from the CRM side (if you want to call it such) in order to maximize its efficacy and efficiency for both parties.

Helmar

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Helmar Rudolph works with visionary companies to help them succeed with
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[This message was edited by Helmar on 14-Oct-2003 at 10:12 AM.]

Edwin Setzpfand
Member Council
Member

Posted 01-Nov-2003 05:34 AM
Brian,

If you consider CRM to be a business strategy to help your customers to do a better business, CRM can exist without e-Business.

For instance, the local baker shop at the corner of your street who has no internet or PC at all but who knows his (hers) customers and through that delivers a high-quality product with great service for which his customers keep coming back (and refer it to others too), has a very successful CRM.

At the other end of the spectrum, you may have a successful e-Business without explicitly addressing CRM (depending on the nature of that business and its type of customers, of course).

However, what we try to achieve here is to help companies to set up the best combination of both, CRM and e-Business to serve their and their customers' present and future needs.

On the CRMGuru pages (in and outside this Forum) you can find loads of postings, articles, columns and referenced books to help you in further exploring these issues. But don't hesitate to come up with new questions while going forward.

Success,

Edwin

Jay Rollins
Member

Posted 04-Nov-2003 01:55 PM
To functionally define e-Business, it is the way to describe conducting business in an inter-connected way to achieve efficiencies in process and productivity. It is also making available intelligent information on demand to be used to make business decisions in real-time at all customer interaction points.

Given this definition, CRM as a philosophy/strategy and as a technology is essential to e-Business.

* Creating a web channel for your business to transact with that portion of your customer base that has a web channel preference.
* Providing the ability to identify a churn candidate as soon as they contact the call center. Then, based upon LTV and an arbitration model that instantly derives a personalized offer from the customer's entire transaction history, provide the CSR with the tools to save that customer.
* Proactively identify, track and correct product issues leveraging the contact center knowledge-base and using it as an early warning system for product managers.
* Leverage feedback and survey systems to facilitate product innovation.

...and the list goes on. Can e-Business survive without CRM? I guess that depends on your competitors.

gautam
Member
Picture of gautam

Posted 15-Apr-2004 08:30 AM
This thread really got me thinking. Thought I’d share the result of my ruminations, so here goes:

e-Biz, at the basic level, is about using IT tools to:
- make business operations more efficient, and
- provide information for better decision-making.

CRM is possible without technology; especially for small enterprises, corner stores and mom & pop outfits. But most businesses would be better off using some technology. IT systems can store and sort data better. Being centrally located, information is accessible to anyone who needs it, right when they need it. Besides, systems can completely automate certain ops like order and complaints processing, freeing up the sales-force for other tasks,

As for the CRM& e-Biz overlap:
CRM is like navigating a river—you can use a rowboat or a motorboat.
E-biz is like the motor, it can be applied to a boat, a bike, a car, even a fan or any tool for that matter.

So, e-biz can be used for CRM or other business areas. And CRM may or may not involve an investment in e-Biz infrastructure.

(As the earlier posts put it, CRM could be viewed in a wider sense; but allow me some simplification to make my point. Smile )

Can e-Business survive without CRM?

What a lovely point!!
While doing my Master’s in e-Business, I'd studied many cases of companies implementing e-Biz projects in the areas of CRM, SCM and ERP.

A large manufacturing firm spent millions ($) in software and hardware purchases; then spend 7 years using it for SCM and ERP programs—to re-jigged internal processes and purchasing operations. After 7 years, they starting thinking of deploying some management time and IT resources towards CRM.

While they become efficient and more connected internally, they'd done nothing to become more connected with Customers. They lost market-share (and revenues) to competitors. Combined with their heavy e-biz spending, they ended up in bankruptcy.

If only they'd put that e-biz motor to work on CRM and locked in their revenues first.

In my study, the best performers had drawn up an effective CRM program and executed it first; incurring IT expenditure where it was needed to support CRM effort. Having spent time learning what makes customers’ tick, their later investments in SCM and ERP where also geared towards customer-responsiveness and not just cost-effeciency.

Others that also did well had run CRM and SCM side-by-side. They also used pilots and phased rollouts, rather than big-bang implementations.

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All conservatism is based upon the idea that if you leave things alone you leave them as they are. But you do not. If you leave a thing alone you leave it to a torrent of change.—G. K. Chesterton

Jean-Patrick (J.P.)
Member

Posted 22-Apr-2004 08:14 AM
E-Business ... we tend to forget that it has been around for a long time and it is just simply another sales channel, like paper catalogs, stores, etc. Ever since EDI, companies have been doing Electronic-Business to get or place orders. It doesn't necessary means that your are looking at a CRM strategy. One has nothing to do with the other, but are complementary. Other people have posted in this thread examples about corner stores doing effective CRM and are absolutely right.

CRM doesn't require technology. It is strategy. Tools are secondary.

The fact that e-business is by definition based on technology, it just makes it more simple to integrate with any technology based CRM that you have in place. It just makes this channel more accessible to your CRM software. Easier integration, means lower costs. But doesn’t necessarily means more sales. All sales channels, need to be considered in a successful CRM strategy in order to better manage were your going to be increasing your contribution to sales.

In other cases, I would definitely consider going e-business in order to feed more information into my CRM, because of this easy integration point between technologies. I could then successfully leverage my e-business channel in order to build my customer base and bring even more added value for them through satisfaction programs and self-service. E-business can be part of a CRM strategy.

JP