Chapter 9: Systems development and project management
1. Customer relationship management (CRM) – involves managing all aspects of a customer’s relationship with an organization
to increase customer loyalty and retention and an organization's profitability.
a. Customer Relationship Management Systems provide two way communication of customer information between the Customer
Relationship Management System and other organizational systems such as accounting, order fulfillment, Inventory, and
Customer Service.
b. CRM is not just technology, but a strategy, process, and business goal that an organization must embrace on an enterprise
wide level
c. Through these systems, companies gain insight to their most valuable customers through “RFM” - Recency, Frequency, and
Monetary value. How recently did a customer shop, how often, and how much did each spend?
2. Evolution of CRM
a. CRM reporting technology – help organizations identify their customers across other applications
b. CRM analysis technologies– help organization segment their customers into categories
such as best and worst customers
c. CRM predicting technologies– help organizations make predictions regarding customer behavior such as which customers
are at risk of leaving
d. Three phases
i. Reporting: Customer information. What happened?
ii. Analyzing: Customer segmentation. Why it happened?
iii. Predicting: Customer predictions. What will happen?
3. Operational CRM –supports traditional transactional processing for day-to-day front-office operations or systems that deal
directly with the customers.
a. Marketing CRM Systems
i. List generator –compiles customer information from a variety of sources and segment the information for different marketing
campaigns
ii. Campaign management system– guides users through marketing campaigns
iii. Cross-selling and up-selling
1. Cross-selling – selling additional products or services
2. Up-selling – increasing the value of the sale
b. Sales CRM Systems
i. Sales Force Automation –a system that automatically tracks all of the steps in the sales process
ii. Sales management CRM system– automates each phase of the sales process, helping individual sales representatives
coordinate and organize all of their accounts
iii. Contact management CRM system – maintains customer contact information and identifies prospective customers for
future sales.
iv. Opportunity management CRM system – targets sales opportunities by finding new customers or companies for future
sales
c. Customer Service CRM Systems
i. Contact center (call center)
ii. Web-Based Self-Service System
1. Click-to-talk
iii. Call scripting system
4. Analytical CRM – supports back-office operations and strategic analysis and includes all systems that do not deal directly with
the customers.
a. Personalization – when a Web site knows enough about a person’s likes and dislikes that it can fashion offers that are more
likely to appeal to that person
5. Operational CRM Systems feed the Analytical CRM Systems with gathered data.
6. CRM Trends
a. Supplier relationship management (SRM) – focuses on keeping suppliers satisfied by evaluating and categorizing suppliers
for different projects, which optimizes supplier selection.
b. Partner relationship management (PRM) – focuses on keeping vendors satisfied by managing alliance partner and reseller
relationship that provide customers with the optimal sales channel.
c. Employee relationship management (ERM) – provides employees with a subset of CRM applications available through a
Web browser.
7. Business Intelligence
a. Business intelligence (BI)– applications and technologies used to gather, provide access to, and analyze data and
information to support decision-making efforts.
b. BI Data Analysis
i. Reliable- The data have been documented as the certified or approved data for enterprise.
ii. Consistent- The processes that deliver the data to the business community are well documented
iii. Understandable- The data have been defined in business terms; calculations and algorithms are easily accessed for
comprehesion.
iv. Easily Manipulated- Manipulate data in different ways to improve organization insight.
c. Improving the quality of business decisions has a direct impact on costs and revenue
d. Claudia Imhoff, president of Intelligent Solutions, divides the Spectrum of data mining analysis and business intelligence into
three categories:
i. Operational
1. Helps with immediate actions
2. Results in sales revenue
ii. Tactical
1. Helps with daily analysis
2. Results in refined campaign
iii. Strategic
1. Helps with planning
2. Results in marketing campaign
e. Data mining– process of analyzing data to extract information
f. Data-mining tools –use a variety of techniques to find patterns and relationships in large volumes of information
i. Classification- Assign records to one of a predefined set of classes.
ii. Estimation- Determine values for an unknown continuous variable behavior or estimated future value.
iii. Affinity grouping- Determine which things go together
iv. Clustering- Segment a heterogeneous population of records into a number of more homogeneous subgroups
g. Data Mining Analysis Capabilities
i. Cluster analysis –a technique used to divide an information set into mutually exclusive groups such that the members of
each group are as close together as possible to one another and the different groups are as far apart as
possible
ii. Association detection– reveals the degree to which variables are related and the nature and frequency of these
relationships in the information
iii. Statistical analysis– performs such functions as information correlations, distributions, calculations, and variance analysis
1. Forecast – predictions made on the basis of time-series information
2. Time-series information– time-stamped information collected at a particular frequency
All Information above compiled from below reference
Gordon, B., & Ducham, P. (2011). Information Systems. New York: McGraw-Hill/Irwin.
to increase customer loyalty and retention and an organization's profitability.
a. Customer Relationship Management Systems provide two way communication of customer information between the Customer
Relationship Management System and other organizational systems such as accounting, order fulfillment, Inventory, and
Customer Service.
b. CRM is not just technology, but a strategy, process, and business goal that an organization must embrace on an enterprise
wide level
c. Through these systems, companies gain insight to their most valuable customers through “RFM” - Recency, Frequency, and
Monetary value. How recently did a customer shop, how often, and how much did each spend?
2. Evolution of CRM
a. CRM reporting technology – help organizations identify their customers across other applications
b. CRM analysis technologies– help organization segment their customers into categories
such as best and worst customers
c. CRM predicting technologies– help organizations make predictions regarding customer behavior such as which customers
are at risk of leaving
d. Three phases
i. Reporting: Customer information. What happened?
ii. Analyzing: Customer segmentation. Why it happened?
iii. Predicting: Customer predictions. What will happen?
3. Operational CRM –supports traditional transactional processing for day-to-day front-office operations or systems that deal
directly with the customers.
a. Marketing CRM Systems
i. List generator –compiles customer information from a variety of sources and segment the information for different marketing
campaigns
ii. Campaign management system– guides users through marketing campaigns
iii. Cross-selling and up-selling
1. Cross-selling – selling additional products or services
2. Up-selling – increasing the value of the sale
b. Sales CRM Systems
i. Sales Force Automation –a system that automatically tracks all of the steps in the sales process
ii. Sales management CRM system– automates each phase of the sales process, helping individual sales representatives
coordinate and organize all of their accounts
iii. Contact management CRM system – maintains customer contact information and identifies prospective customers for
future sales.
iv. Opportunity management CRM system – targets sales opportunities by finding new customers or companies for future
sales
c. Customer Service CRM Systems
i. Contact center (call center)
ii. Web-Based Self-Service System
1. Click-to-talk
iii. Call scripting system
4. Analytical CRM – supports back-office operations and strategic analysis and includes all systems that do not deal directly with
the customers.
a. Personalization – when a Web site knows enough about a person’s likes and dislikes that it can fashion offers that are more
likely to appeal to that person
5. Operational CRM Systems feed the Analytical CRM Systems with gathered data.
6. CRM Trends
a. Supplier relationship management (SRM) – focuses on keeping suppliers satisfied by evaluating and categorizing suppliers
for different projects, which optimizes supplier selection.
b. Partner relationship management (PRM) – focuses on keeping vendors satisfied by managing alliance partner and reseller
relationship that provide customers with the optimal sales channel.
c. Employee relationship management (ERM) – provides employees with a subset of CRM applications available through a
Web browser.
7. Business Intelligence
a. Business intelligence (BI)– applications and technologies used to gather, provide access to, and analyze data and
information to support decision-making efforts.
b. BI Data Analysis
i. Reliable- The data have been documented as the certified or approved data for enterprise.
ii. Consistent- The processes that deliver the data to the business community are well documented
iii. Understandable- The data have been defined in business terms; calculations and algorithms are easily accessed for
comprehesion.
iv. Easily Manipulated- Manipulate data in different ways to improve organization insight.
c. Improving the quality of business decisions has a direct impact on costs and revenue
d. Claudia Imhoff, president of Intelligent Solutions, divides the Spectrum of data mining analysis and business intelligence into
three categories:
i. Operational
1. Helps with immediate actions
2. Results in sales revenue
ii. Tactical
1. Helps with daily analysis
2. Results in refined campaign
iii. Strategic
1. Helps with planning
2. Results in marketing campaign
e. Data mining– process of analyzing data to extract information
f. Data-mining tools –use a variety of techniques to find patterns and relationships in large volumes of information
i. Classification- Assign records to one of a predefined set of classes.
ii. Estimation- Determine values for an unknown continuous variable behavior or estimated future value.
iii. Affinity grouping- Determine which things go together
iv. Clustering- Segment a heterogeneous population of records into a number of more homogeneous subgroups
g. Data Mining Analysis Capabilities
i. Cluster analysis –a technique used to divide an information set into mutually exclusive groups such that the members of
each group are as close together as possible to one another and the different groups are as far apart as
possible
ii. Association detection– reveals the degree to which variables are related and the nature and frequency of these
relationships in the information
iii. Statistical analysis– performs such functions as information correlations, distributions, calculations, and variance analysis
1. Forecast – predictions made on the basis of time-series information
2. Time-series information– time-stamped information collected at a particular frequency
All Information above compiled from below reference
Gordon, B., & Ducham, P. (2011). Information Systems. New York: McGraw-Hill/Irwin.