Anda di halaman 1dari 67


TABLE OF CONTENTS Abstract Chapter 1 Introduction Introduction.6 Aims and Objectives...8 Scope ..9 Rationale.10 Methodology...10 Conclusions & Recommendations11 Chapter 2 13 Customer Loyalty Programmes.23 Loyalty as Strategy33 Rhetoric Vs. Reality..36 Chapter 3 Methodology Research Methodology.40 Summary of Results.46 Chapter 4 Analysis Results48 Literature Review The Concept of Loyalty

Discussion of Results.56 Origin and Motives64 Tescos definition of Loyalty.63 Success Factors..66 Strategic implications of the Clubcard72 Competitive Pressures....77 Chapter 5 Conclusions and Recommendations Conclusions81 Limitations...89 Recommendations89 References93 Appendices

Customer relationship management is perceived as very important part in twenty first century. Deregulation in the energy market has changed the entire way business was done. Southern electric is second ranked company in the United Kingdom and it is a part of Scottish and southern energy .Southern electric has demonstrated phenomenal growth in the last five years and it has drawn attention from all business groups. Literature review from the published CRM material and the use of qualitative and quantitative survey discovered the value of true CRM and its importance in the energy market. It is recommended that if concerned areas are given appropriate attention in that case much needed boost and help can be given to improve further relationship between employees and CRM.

1.1 INTRODUCTION: Competition of energy companies in the UK are forcing energy firms to be more customer centric. In recent time focus of energy firms have shifted to customer satisfaction and there has been competition to be on the top for customer satisfaction in all areas of business. Before company can think to be productive and profitable it is imperative to innovative Customer Relationship Management (CRM) strategies and reaches to a great extent, in achieving the desired results. Being customer focus and relationship management have become very important marketing and business tactics for many companies looking competitive advantage.
Customer relationship management is basically a strategy and it is used to get more knowledge about customers' needs and perception about their approach to a specific product or service in order to create stronger relationships. The most useful way to think about CRM is as a strategic planning that will assist company for better understanding about there customers need and how company can meet those needs and improve bottom line at the same time. With the available wide range of internet based facility, companies have found it difficult to maintain relationships with customers since the ecommerce is widely in use across the globe. Computerization has revolutionized the entire way firms are approaching their CRM strategies because computers have also changed consumer buying behaviour. Information on any customer contacts can also be accumulated in the system. The motivation behind this approach is to develop services provided straight to customers and to use the information in the system for targeted marketing and sales purposes. A CRM stand for Customer Relationship Management and the origin of CRM lay in the observation that one element in competitive advantage is the ability of companies to retain customers. Companies have taken stance to implement a strategy of fulfilling the customer so as to maximise potential future earnings. This seems to become especially valid approaches considering the current Internet focus of competitors are just a click away.

Gas and electricity market was deregulated in 1996 by the British Government and with the opening up of the economy and globalization this market has gained attention from new market entrants. This is why knowledgeable customer is challenging the energy industry. Therefore in this current competitive situation, for an energy company

6 to survive competition, succeed and make profit, there is no option left except to understand and learn by actively responding to consumers needs. Companies are offering customised products like e-billing, online meter reading service and so on but these are common offering by all the companies and customers want much more customised service in unique way, further to this Government watch dog is constantly monitor energy companies and impose heavy fine in order to save customers and to make sure competition reaches to pick level so the main objective of deregulation remain fulfilled. The battle of all energy companies in the UK for gaining a greater market share, is taking on the new dimension. In the current energy crisis and inflation due to falling pound strength against dollar, companies are finding it quite difficult to meet the expected high growth. In order to strengthen their sales, Energy companies are in pursuit of innovative ways and means of achieving real growth through new strategies that help acquisition of new customers and retaining the most loyal of the existing customers. Success of an energy companys strategy for new customer acquisition will depend on its ability to understand perception of customer and using these into effective and operating models. It is only possible by making sure and ensuring a good customer experience at every customer touch point is the ultimate goal of a successful growth strategy and good customer experience will drive new customer acquisition and promote customer retention so higher marketing cost can also be controlled and that will translate into increased profits. All energy companies are quite conscious about relative costs of acquiring new customers. Management in company will always emphasize on getting maximum market share. Most companies want to keep customer with them for longer period, rather than getting new customer or creation, with the result retaining customer is a goal of the every day. In fact energy companies are fully aware that losing the existing customer and acquiring new customers is an expensive transaction for the company. Further to this it acts as a black spot on the companys reputation Therefore, the challenge for the energy companies are to retain and maximise the profitability of the existing customer relationships by fulfilling each and every need of customers. With the shift from a profit-centric to a relationship-centric business approach, CRM has become main thing. Energy firms are adopting CRM to unite people, process and products more effectively to get on the true relationship with the customers. Towards this end, Company expects to propose various ideas and approaches to understand the fundamental marketing motivations driving the CRM trend. In order to gain the challenging preferences of the customers and to stay ahead of competitors, Energy companies are bound to attract customers by providing excellent service. Online billing and meter reading, complemetary discount are just a few of them. Energy Company can essentially enhance customer service by business process reengineering. It is not enough for upper level of management to deliver but good amount of support from all level of employees need to demonstrate. It is observed that the energy companies lose their customers due to different reasons. The main reasons are not being competitive in price and level of accuracy in the bills as estimated bills are the biggest problem prevailing in energy industry in current times if these factors are taken in to serious consideration complaints can be reduced drastically

7 and hence this company will get higher ranking in terms of customer service and price and will be more favourable for the customers. Experts of energy companies estimate that poor service is the major reason for customers leaving their energy supplier so that energy companies should adopt customer relationship building approaches such as responding to complaints fast. Energy Company can get a competitive advantage with the help of CRM by becoming low-cost players in the market and achieving operational efficiency and maintaining customer loyalty. The ability to predict the volatile market and customers changing preference as few consumers are least concern for the price or service but more aware about green electricity products that customers are likely to purchase over a period of time. Importantly implementation of Customer relationship management will drive to enhance customer satisfaction leading to business growth. CRM helps organisations to motivate customers to remain loyal. There are several CRM issues such as, effectiveness and challenges draw attention of the energy industry. Having understood the importance of CRM in which companies have benefited they need continuously invest in the customer relationship activities. Customer Relationship Marketing is a practice that encompasses not only marketing related activities but also all activity directed toward establishing, developing, and maintaining successful customer relationships. The focus of customer relationship marketing is on developing long standing relationships and better corporate performance through customer loyalty and lower customer churn. If we take precise meaning of Customer Relationship Management as its name refers the primary focal is placed on the customer satisfaction and customer care by knowing their needs. The key issue is to maximise customer value over time by increasing customer loyalty towards company. If a company starts developing better relation with the customers, it also improves overall business processes and boosts the profits, generally CRM is much more effective and automated method which is used to improve and connect all areas of business to concentrate on generating strong customer relationships. All factors are connected with each other to improve, save and acquire business to customer relationships. The common areas of business which are positively affected by CRM those are include sales, marketing, and customer care strategies and so on. Here, the case study of Southern Electric is being discussed. Southern electric is U.K based company and it is a part of Scottish and Southern Energy group (SSE). SSE runs its businesses under three major brands in the United Kingdom, it is second largest energy supplier in the UK. As per SSE also holds 50% of the equity of Scotia Gas Networks private limited company, which operates the Scotland and Southern distribution networks. The core values of company are safety, service, efficiency, sustainability, excellence and team work. 1.2 OVERVIEW OF COMPANY

8 SSE is known as SWALEC in Wales, SCOTTISH HYDRO in Scotland and SOUTHERN ELECTRIC as in England. SSE main objective is to provide the energy to the people in a reliable and sustainable way. Southern Electric is a British owned FTSE top 30 company. Southern Electric (SSE) is one of the leading suppliers of electric and gas in United Kingdom. SSE has been supplying gas and electric to homes and business for over half a century. SSE has been voted the overall best energy supplier in the UK for the period of 2006 to 2009 by U switch satisfaction reports which is an independent online energy survey company.SSE has recently named greener company in the UK for generating more renewable electricity than any other energy company in the United Kingdom as per . Southern Electric has come up with great plans to be on the right spot by focusing more on customer care and reducing maximum complaints for its services. Company has heavily invested in renewable energy in order to meet new EU legislation. Southern Electrics main competitive advantage is its lowest advertisement budget over its competitors a British brand name and largest investor in renewable energy supplier in the UK which has attracted many attention from the consumer group. Although this is merely just one facet of Southern Electric, apart from that it has the largest off shore gas storage facility, own and operates worlds first tidal power station, maintain over 1 million street lights in the UK. The implementation of customer relationship management is often obstructed by numbers of factors such as persistently fragmented nature for the energy industry and relatively immature nature of IT system and new government rules which are often implemented on all major energy firms by the UK government or by European Union. CRM is helpful in terms of creating time efficiency and savings on both sides in terms of the business point of view. If CRM is implemented accurately and with the help of its solutions, companies can reap a better understanding of their weakest and strongest side and how they can develop its strategy. Therefore customers can have improved products and services. In order to get deep insight on CRM, it is vital to check all of its mechanism. 1.3 CRM-MEANING Customer relationship management (CRM) is nothing more than a business strategy that connects entire organization from front to back. It is important for any business to put customers at the heart of enterprise. The right CRM strategy and solutions would help reliability and consistently. Make customers happy each time they interact with business by empowering them with anywhere, anytime, and any channel access to get right information and more personalized services, secondly to reach more customers with good efficiency, increase customer retention, control churn and boost customer loyalty by increasing opportunities to up-sell and cross-sell and making repeat business happen at lower cost, third thing is , improvements in business performance by providing customers with the ability to access more and customised information through self-service and assisted-service capabilities but most importantly when it is convenient for the customers and the last but very important is to balance sophisticated

9 functionality with fast implementation and more effective support for a rapid return on your CRM investment. Todays customers get a growing range of wide choices in the market for the products and services they can buy .Customers decide their choices on their perception of quality, value for money, and quality of service. Each customer is different than other and tends to have a specific behaviour, so that buying habits are highly likely to be difficult to understand, and that is why companies always want to get some knowledge about consumer behaviour so that products can be introduced in a way where it can easily reach to the target customers. Once this skill is developed it means it becomes much easier to change customers perception of the product or service to set up a relation between the company and customers. Customer relationship management (CRM) is one of the primary and strategic tool in industry today, regardless of whether the business serves retail or wholesale, manufacturing or service provider. In the energy industry, the important towards CRM is being fuelled by competitive pressures from existing competitors and new-entrants, that are literally raiding a territory of a company to get customer base. Customer Relation Management is an integral part of any business in todays era, it is very important to create maximum number of customers. It is vital to maintain those existing customers and grow deep and strong business relationship. In times of intense competition it has become important to have set standards of CRM, it is not an option anymore CRM is a crucial part of any business. As per Customer relation management can be defined as it is not just the application of technology, but it is a strategy to learn more about customers needs and behaviour in order to develop stronger relationship with them. Customer relation management (C.R.M) is a strategy that involves building effective business relationships with the customers. The prime focus of the CRM strategy is on solving customer grievances and it revolves around it but in recent time few aspects of it has been changed and CRM has become broader than ever. CRM also boosts businesses to get depth knowledge of their customers and adopt new ways the way business is done to ensure that can serve customers in the best way. Briefly, CRM can be very important tool to value customers and to improve customer relations it is understood better you know your customers, the faster you become responsive to their needs and once you know their needs it becomes easier to satisfy the requirements and increase new customer base. The topic here is the importance of CRM in an energy industry, it is imperative for any company to implement CRM effectively in highly competitive market such as energy industry in the UK. Energy companies in the UK are privatised since 1996 and now monitored by OFGEM. Since then immense competition is prevailing. The primary focuses for all companies are to capture maximum share in the market. There are few reasons why company should choose to use CRM wisely, firstly it can enhance customer satisfaction and maintain customer churn by ensuring good reputation continuously grow in the market, A good reputation of a company is very important and specially for energy industry it is quite obvious as customers expect error free service, secondly better value from existing customers and by minimising cost which are associated to support and service them and increasing total effectiveness and

10 reducing expenditure of total sales activity, in order to remain cost effective company needs to be innovative in terms of using cheaper yet faster way to resolve customers related issues and can also try to minimise sales related expenditure for example direct marketing can be replaced or reduced by effective online or telemarketing and last is to improve profit margin by targeting the most profitable customers who generate maximum number of revenue for the company and dealing cost effectively with unprofitable customers, when company has vast volume of customers it is essential to segment customers in to different category and cost related to them should be divided proportionately ,with the help of effective CRM company can know how to look after its existing customers and it can start expanding customers base as it is rightly said and well supported by that the more you know about your customers it becomes very easy to find new customers base. Customers requirements over the period can change so it is important to make it easy to find out more about customers and making this information available for every one in the company so it can be exploited. The study explores the value of Customer relation management and organizational strategies in big companies so main objectives of research are as follows: What is the role of CRM in an energy companys performance? It is understood from the definition of CRM as its a cooperative efforts towards maintaining long term relationship with customers and generate new customer base and find out cross selling opportunity within a set group of customers, the first question is the main role of CRM in an energy company and how CRM can be helpful in order to improve overall customers satisfaction and how it can help an energy company to gain maximum customer base in highly competitive energy market in the UK. Do employers encourage the relationship between CRM and the employees? CRM is a comprehensive approach and it is not only responsibility of marketing or IT team but rather a cooperative effort among all employees of the company because each department is linked with another department. Does CRM encourage company for better customer service? What are the factors of CRM which encourage the company for better out put? CRM gives analytical details about customers information through which management or marketing team can predict customers behaviour and strategy can be formulated so that bigger market share can be captured. Can CRM improve sales effectiveness in an energy company? CRM provides each and every detail about customers behaviour, together all data can be analysed and it can be put in a practice where maximum customers can be gained. 1.4 SUMMARY This chapter has supplied with a crucial guideline of the effects to come. It has given a comprehensive description of the aim, purpose and objectives of the study and what the study look to achieve. It clearly states the scope of the research and areas where the study will not throw much focus on. The study now goes forward into the journey of discovering the true importance of CRM in an energy company and discusses different way to get more insight on it.



2.1 INTRODUCTION It is very important for any company to implement CRM accurately. It is often seen as many companies consider CRM as a formality or it is only considered as just an IT tool and it is not implemented correctly. There is also seen in lack of cooperation among the employees or lack of communication is also responsible for failing to launch CRM successfully in the organization. Customer relationship marketing has come as very promising marketing activity for businesses which are operated in intense and cut throat environments. Businesses have to spend more than six times to gain new customers than to keep them within the company. (Gruen, 1997). It is very important for any business to focus more to maintain relationship with the existing customers to keep them and increase customer base. It has also been observed most of the industries have been aware to provide customised to service to the customers, such as banks now have relationship managers for their selected customers, telecom companies have customised service to their high users, hotels have also unique service for their regular guests, airlines companies have air miles for their regular fliers and most of the super markets have loyalty points to keep their customers shopping with them 2.2 CRM DEFINED Anderson and Kerr also define Customer Relationship Management is a comprehensive approach for creating, maintaining and expanding customer relationships.(Anderson & Kerr 2002, p 2), If each word is taken individually it can be understood thoroughly the first word is comprehensive it means CRM is not related to sales and marketing or with information technology it is an entire responsibility of customer service group, sales and marketing or information technology can be a part of CRM for any company, second word is approach it means CRM should have clear plans and simple terms to use it. The third word is creating it is quite obvious that no company can survive

13 without customers so creating customers is utmost priority for any company, fourth word is maintaining it means company has to spend substantial amount of money for marketing so that company can gain new customers therefore existing customers can be real assets so maintaining them accurately and knowing their spending habit can be real advantage also by doing this company can minimise their marketing cost and gain competitive advantage over its rivals and the last word is expanding, the simple meaning is when CRM is implemented and with the help of all captured details and by analyzing data about customers and their habits of buying a brand new customers can be gained.

The common thing for marketing department is to focus on capturing market share rather than retaining the customers or to build up longer relationship with the existing customers. In the recent time this trend has changed significantly as more companies are coming in the market to challenge market leader so capturing only customers focus can be harmful for the company and should shift the focus on retaining customers. (Baker,2000). Therefore in response to these changes there has been a new trend which has come in to existence and it is to retain more customers rather than focusing only on new customers and that will eventually reduce overall cost of the company. This strategic change has been very popular in the recent time.(Sharp & Sharp, 1997). Establishing, maintaining and enhancing customer relationships have always been very important aspect of any business. Although, in recent times there has been a major boost in CRM related research (Kamakura et al., 2005).Although CRM is considered by academics to be a business philosophy strongly connected to relationship marketing, it is the connection with technology that is particularly of interest. Marketing have begun to discover and appreciate the linkage between CRM technology, relationship marketing and business relationships as providing opportunities for competitive advantage. It is important for entire energy industry to be customer- specific. In this context, the management of customer relationship in energy industry demands special focus. Gone are the days when customers used to wait for call centre executive to speak and did not mind the long serpentine queues and waited patiently for their turn with patience. In todays fast and internet era, no one has the time to wait. Today, energy companies are more customer-centric and increasingly focused and constant look for the options to provide service with innovation as customers choose on the service provider who distinguish through quick and effective service. Nevertheless, there is significant importance of Customer Relationship Management (CRM) than just managing customers and analysing their behaviours. Energy firms are quite aware that now their success is mostly dependent on the CRM strategies and implementation of it. Energy companies have recognised that good CRM bonds

14 customers with the organisation for a longer term relationship and eventually it will result in increased revenues. Recent time customers expectations becoming more competitive, Energy firms are coming up with a wide range of products and innovative services every day in order to please customers. The main challenge for the energy firms is to make sure that customers prefer their products and services over rivals. The main reason is to develop and cultivate better relationship with customers is by appreciating their needs and preferences and addressing appropriately to their needs. Focus more on CRM and enable staff with the help of IT so they can understand the needs of existing customers in better way and to ensure customer satisfaction which is the utmost priority of any company in highly competitive market, similarly it is vital to find out the possibility of cross selling opportunity to gain a competitive advantage are the other issues drawing attention and interest, Southern Electric recently started telephone and broadband service to their existing customers. 2.3 IMPORTANCE OF CRM There are numerous benefits for implementing CRM effectively most importantly sales can be increased by anticipating customers needs on historic trends at the same time it is also possible to identify needs of customers more effectively so satisfaction amongst customer can be increased, company itself can identify new business amongst its own customers by suggesting alternatives or just doing cross selling as it is very easy to generate trust for new products for set customer base. Company can not treat every customer in the same way there must be identifiable segment in which company can get more important of highly profitable customers so further attention can be given to these customers and churn ratio can be kept under control in highly competitive market. It is also possible there are group of customers who generate maximum number of complaints so by identifying these customer groups and by resolving their complaints effectively employees would have more time to look after other customers. This could lead to improved marketing of the products and servicing by focusing on effective and targeted marketing communications which specifically customer centric and a more personalised approach with new and improved products with appropriate development so that company can win more business in the future. As per Chaudhuri and shainesh (2001)- Department in the company who are responsible to implement customer relationship management have to have very clear understanding and commitment for their companys customers, cautious devotion to companys goals, dedication from both senior managers and line executives and detail awareness of customers perception. Customer relation management is about nothing more than applying right frame of customer business method and to monitor attitude and behaviour of them. CRM is capable enough to change relationship with the customers and increase the revenue in the bargain. Further to this it helps to decide which customer is much beneficial for the company so when time comes it is very easy to decide which customer to retain and which customer to let go.

15 The main importance of CRM is to understand and treat each and every customer as an individual and it is even important for any company to know how to treat customers as per their importance in the company as no company can afford to treat all customers in the same way. This will help any company to deal every customer in different way and company can focus their high profit generating customers in a way where those customers feel they are being treated differently and special way. These types of customer often have good impression on others and they indirectly market their experience with the others and company can get bigger market share. It is not right to say personalization and customization are only mode of maintain customer loyalty rather they can help drive customers to purchase higher. In order to boost up customers loyalty and to encourage and maximise deep business knot it is very important to get closer and efficiently responding to the needs in a right way, however retaining customers or controlling churn ratio in competitive market is much harder and requires great skill and quality anticipation. Fundamental of for any business is to understand and does business as per customers wish and the way they want to do and not as per enterprise way. There are numerous big companies in the market which are known for strict customers centric and focused and it is very important as being customised it gives consistent, dependable and convenient interaction with the customers in every transaction. Technology which is used for customer relation management focus on maintaining and monitoring all transaction that an organization has with their customers in order to use that data in a variety of companys application. It is understood for any companys ultimate objective is to create and generate as much profit as they can by giving customised service so customers should not have any problem to pay the prise which is asked against the kind of goods or service being provided by the company. In addition to this that can help company to fulfil customers unspoken wants and needs. As per Raghunath and shields (2001) there are main five needs of customers and these are good and customised service, appropriate prise for the offered products , types of quality ,action and appreciation. Apart from these, there would be requirement which even the customers have not taken consideration, but which, if it is satisfied will generally lead to higher customer satisfaction and loyalty. CRM, if implemented properly and exploit each aspect of it and that would certainly lead to cross-selling and up selling of products and services. Cross-selling is nothing more than selling the right product to the right customer. The very important aspect of CRM is being capable to satisfy customers ego and if it is implemented accurately it will smooth the customer's negative emotions they could have, for not reaching their expectations regarding the service or the products. The requirements for doing business in the UK are changing rapidly, consumptions patterns are different and there has been new technology for billing, supplying and collection information. New laws on energy firms are also being umplemented by the Governement to cut down emission and so on ,further to this competition on energy market is also increasing day by day and many small firms are also in the market to challenge the big firms in this situation effective use of CRM is essential for a big firm to get a big share in the market,In order to survive and grow companies must find new ways to approach the customres and that would lead to emerge new ways in marketing

16 research.As it has been mentioned in introduction CRM highlight the significant of creating then maintaining and boosting customer relationships. Neverthless,there is a requirement to create a good understanding of CRM and of how an energy company can use IT and enetire system as a whole.Therefore purpose of this study can be exploratory and discriptive but it going to be more explorative.The analysis of this research will be based on empirical findings at the same time the theoriticalframe work of this study.The main goal with CRM is to optimim company profits by increasing the value of customerss interaction.Therefore an energy cmpany needs a business strategy that concentrate on customres and later it can explore a process oriented view of the organization.However business process needs to be well supported by a CRM system and a well organised support from all related employees will be needed.The CRM is quite helpfull to collect and analysis of customer data and that can manage customers ineraction more effectively,further to this analysis of this study will show why do companies need to have effective CRM and how it can help companies to function and support marketing,sales,churn ,cross selling or upselling and customer service. CRM functionality is diveded into mainly three parts first is marketing automation,second is sales force automation and third is customer support and service, heare all categories comprise different functional groups and arguably whether it is a service company or a production company a core activity within each function will remain the same.Neverthless there are few aspects which are seemed to have an influence on requirments,it could be different stages in CRM improvement procedure and the organizational process orientation.In order to explain how an energy company can use a CRM effectively this study would reveal details of how CRM could be used effectively at different level in the sales and customer retention where churn ration is very high. CRM can be very important tool to get competitive edge in an energy company; above all in the U.K consumers are free to choose their own supplier so importance of CRM can be significant.

17 2.4 BENEFITS OF CRM In recent times it is often mistaken that CRM is just a technical tool only, besides that even those who have implemented CRM effectively for their businesses are seemed to have forgotten the basic concept of CRM as building a profitable relationship with the customers. This most important part is left only on technology (Schneider and Bowen, 1999). This situation is mainly because of managements inability to accept the value and importance of customers and serving them with utmost care so they can be kept satisfied and happy, If the core value is ignored in that case it might result in low sales and low profitability. As per (Lemon, et al, 2002) the average, unhappy customer is likely to tell eight other prospective customers about his negative or bad experience with the company. In the past most of the companies used to focus on higher productivity through the higher level of effectiveness of employees and cost reduction. Companies also use TV campaign, mass mailing and so on, however rapid growth of service sectors has proved that these would not fetch enough profits as it is expected, after the emergence of cheaper, faster and more efficient systems of communication and internet have made the business people aware that the competition is just a mouse away and matter of few seconds and all information will be on computer and this change has revealed the importance of keeping the existing customers longer with the company and loyal so that they do not switch to the competitors, without much consideration and this has led to the optimum focus of companies about the significant importance of treating customer needs with utmost care and higher quality of personalised service in a way which can be good to both customers and companies. As per Berry (1983) Customers to any business are those enterprises or people which benefit the company by the use of product or service offered by that respective business, certainly something in return and most cases a price. When customers pays a price they expect to get some specific thing with an appropriate features and quality, if their expectations are not met with required amount of quality of the service it leads to a unsatisfied customers base and the offer exceeds their requirement for a stipulated price it leads to a very satisfied customers base and it is said to share his joys with other prospective customers and indirectly do marketing for the company. In the UK customers are free to choose their energy supplier so they have wider choices to choose from so it is highly likely for the customers to switch from their existing company to another company in search of a better deal. But the companies have discovered that creating new customer is much more costly than spending appropriate amount to keep existing customer with the company and hence that will generate regular cash flow for the company and then profit. The reports of getting a new customer can be different from as low as three times to as high as fourteen times of serving the existing customers. (Berry 1983) In the recent times as per customers view point there is a less chance to leave company often, if everything is going fine and comfortably with the existing company and the amount of service is fair and if there is no much difference in cost as switching

18 company involves changes and disruption in service level that most of the customers would like to avoid. Many companies have realised this facts and have started making long term relationships with their existing customers. (Hart et al, 2002) therefore this has been proved to be beneficial for the both parties. This has ended up managing this relationship as a strategic weapon and the evolution of Customer Relationship Management and most commonly known as CRM.


As CRM is very important tool for any business sector in order to get competitive advantage it can be very useful for any energy company. As per, there are numerous benefits of CRM, but before that there are three important aspect of CRM mechanism which are very important to understand and that differentiate the unique benefits from each aspect. CRM CONSTRUCTION: There are three parts of application construction of CRM: 1. Operational - mechanization to the basic business processes 2. Analytical - support to monitor customer behaviour, implements business intellectual alike technology. 3. Collaborative need to ensure the contact with customers via phone, fax, email, web, text, post, in person. OPERATIONAL CRM The meaning of CRM is to support front office and related business process, it also includes customer contact i.e. sales, service and marketing and Information which are collected through these processes. ANALYTICAL CRM In analytical CRM, data gathered within operational CRM and/or other sources are analyzed to segment customers or to identify potential to enhance client relationship. COLLABORATIVE CRM Collaborative CRM facilitates interactions with customers through all channels and supports co-ordination of employee teams and channels.



In the free energy market, consumers are free to choose which energy company they want, the processes by which they choose their company are solely depend on the image of company in the market and it means the company's total focus in offering its products or services in social way. In a competitive market where companies do have a low degree of sovereignty, the manner in which companies make strategic decisions, taking into consideration the Social Responsibility perception, becomes in itself a matter of judgment. Though CRM is very important and respectful tool and consistent with marketing theory (Abbott, Stone, & Buttle, 2001), and makes utterly good business sense and is easily available today from a variety of different vendors, it has continued to face serious problems and implementation difficulties. Few popular business magazines (Le Pla, 2002;Markowitz, 2002), as well as commercial study teams have published sarcastic reviews on the implementation of CRM technology, focusing on the lack of commercial profit gained from extensive CRM investment. Right way to implement CRM technology and adoption requires noticeable, concentrated and long-term senior management buy-in and significant organisational change if its full remuneration is to be understood. (Ling & Yen, 2001).The core use of CRM technology is to deliver customer loyalty and to increase corporate profitability, nevertheless the META Group declares that more than half of all CRM projects do not produce required results(R. Davis, 2002; Seligman, 2002). A survey of 1490 companies found that 92% of businesses plan or have implemented CRM tool, however 40% of the companies with CRM solution were facing serious deployment problems. R. Davis, 2002 has mentioned that up to 71% of firms had not gained any benefit from CRM tool implementation or did not meet basic company goals, such as return on investment. This might in part reflect the complexity in understanding and matching the suitable CRM investments and returns (Ang & Buttle, 2002).It also state that 22% of senior managers have reported that CRM implementation had failed to provide profitable growth and in few cases CRM had even spoil existing customer relationships. In response CRM suppliers have undertaken new development, focusing on adding more features, benefits and value. CRMs success is not well stated in the IT or marketing literature. This can in part be accredited to the great difficulty in agreeing on a CRM definition, as well as the diverse approaches to CRM research. The IT research focuses mainly on understanding CRM system implementation issues, significant success factors, and improving the use and implementation of CRM. Other researchers have stated CRM success around the size of systems quality, information excellence and user contentment, following and adapt the DeLone and McLean IS Success Model (DeLone & McLean, 1992). The IT perspective of CRM implementation success most appropriately and briefly as: an up-and-running system with agreed-upon requirements delivered within schedule and budget. It has been defined by Brown and Vessey (2003, p.66).There have been few more observed studies attempting to link CRM success straight with business performance or relationship performance such as market share and retention and churn

20 control (Croteau & Li, 2003) This is in difference to the marketing research, which has mostly been focused on the impact of CRM on customer relationship process. This does not mean that marketing researchers have ignored the prospective business performance aspects of CRM and Marketing researchers have found for example that CRM technology tends to positively influence business performance and customer satisfaction method. CRM marketing research try to link success more directly to business performance measures, while also examine the interaction of relationship management implementation and IT effectiveness. The marketing literature appears to have common view of CRMs success which focuses on how to use CRM as a change method to rejuvenate business growth (Rigby & Ledingham) or support customer focused business strategies. The existing literature suggests that CRMs success is solely depend on successful CRM implementation (Brown & Vessey, 2003),CRMs capability to support the customer facing characteristic of business approach and improving economic performance(Reinartz et al., 2004). That is obvious that the unfortunate results reported for CRM implementation can be partly explained by the incompatible CRM models and related research. There are few issues connected to calculate CRM success including the incapability to isolate, test and examine CRM technology factors apart from CRM strategic, organisational and business factors, then correctly isolate and separate CRM investment and identify and measure the dependent variables(e.g., loyalty, retention or profitability( Reinartz et al., 2004). CRM research has generally tended to give emphasis to augmented profitability, performance improvements and customer retention and that appear with very little or no focus on calculating relationship development with customers. (Hirschowitz,2001). The major investigation of CRM accomplishment has generally focused on project management success, improved data quality, management leadership and strategic promptness for CRM implementation (Bose, 2002). Few of them consider the root of CRM estimation and success as a customer confidence issue and that customers should be able to feel some improvement in association from a successful CRM technology implementation. The CRM implementation challenges have been evaluated to the early days of implementation, implying that it might only be a matter of time before the factors which make CRM technology successful are understood and measurable benefits are more fully understood (Brown & Vessey).The widely held of CRM research, though it focused on what has to take place within an organisation to execute CRM successfully. 2.6 CURRENT CRM USE Today CRM is widely used mainly by sales; sales support and customer service staff that Includes call centres and telemarketers to portray a combined and harmonized point or points of contact to the customers. It can be very handy tool in competitive market such as energy industry. It is also used as a marketing tool to help in segment and target customers, help develop marketing and sales programmes for targeted customers, and aid in keeping track of customer actions (Ling & Yen, 2001) CRM needs the IT, and sales and marketing departments to work strictly together if the benefits of CRM should be properly

21 realised. However this is not always the case (Ryals & Knox, 2001). Further to this CRM, by definition, and reliable with an underlying philosophy, collects, stores and utilises detailed customer information and thus is potentially a major important contributor to organisational knowledge and knowledge management (Alavi & Leidner, 2001).From the practitioners point of view , CRM technology puts value to the business by making it easy for customers to do business, focusing on the customer for products and services and redesigning customer facing business processes from the end customers perspective and designing a complete, evolving electronic business architecture, and nurturing customer loyalty. (Turban, Rainer et al., 2003). As per CRM systems also have the probability to become an essential component of business fulfilment, adding customer value by combining all the business components from sales through distribution and fulfilment to invoicing and even receivables. However, CRM system implementation has received different opinion in both the academic and popular literature. As per Markowitz, (2002) The CRM industry suffers from much more hopeful and under delivering.Therefore CRM is seen as ineffectually meeting todays business and needs to let alone meet their own potential for core strategic business value. 2.7 OTHER ASPECTS OF CRM In order to commercialise CRM appropriately major focus has been given existing theory of relationship management and CRM has high probability to develop stronger knot to relationship building at a primary level. The CRM business process deploys product, price, place (distribution) and promotion as fundamental elements of the business and marketing strategies, but the current marketing invented theory views the 4Ps as being not capable to create, develop, sustain or enhance relationships (Gummesson, 2002) However, Winer (2001) recognized the need for a relationship element within his seven component CRM evaluation framework ,He has not expanded upon the require elements, techniques or applications to get or calculate this component, however they do not specifically include a relationship component in their five areas for future CRM research. (Gummesson, 2002) 1. Market is comprising and consisting of participants, resource allocation, transactions and communications. 2. Business models generally involves logistics, communication channels and intermediation of branding. 3. Knowledge management includes storing, ownership and transformation and knowledge management process including people management. 4. Technology, for example user interface, media (voice/video) and virtual reality 5. Human factors that includes usability, trust, accessibility, privacy, attitude and behaviour. CRM and customer support shares a high level of data and information management involving a balance between human and computer-based knowledge. Knowledge management capabilities within the organisation was invented to be one of two key factors affecting CRM impact (Croteau &Li, 2003); while Shoemakers (2001) work favours an opportunity for IT and marketing people to work together to build knowledge management systems along with CRM systems to help and expand

22 sustainable competitive benefits. Despite the high CRM technology implementation failure rate, the invented theory indicates that CRM technology may supply longstanding benefits for business and customers, conversely two underlying research gaps are clear, first a need of common CRM knowledge and understanding between technology and Sales and Marketing units also senior management vision and correct direction and the lack of centre on the connection between CRM technology adoption and customer relationships (Ling & Yen, 2001).

2.8 CRM AND RELATIONSHIP MANAGEMENT (R.M) Customer relationship consists of two willing parties using relationship mechanism such as mutual trust, understanding and commitment to initiate and maintain their relation (Gounaris,2005). Therefore the relationship process between CRM and RM may not be completely equal between the buyer and the seller; in any specific example sellers may want a relationship while customers may want single transactions and do not want to be remembered. However there are few incidents that identify the unique viewpoint of customers in an exchange. An empirically study by Pels, Coviello, & Brodie, 2000 have investigated the effect of the customers orientation toward CRM. The customers orientation towards initiating and continuing a relationship has an effect on the development of the relationship, and has been revealed to considerate the impact of relationship investment and the following outcomes. Ganesan (1994) noticed that the customer relationship orientation has played very important role in the development and extension of relationships. For example, there are few customers who considered short-term relationships advantageous and would seek short-term benefits like price reduction. Peters and Fletcher (2004, p. 61) investigated the relationship orientation exhibited by the respondent towards a company nominated by the respondent by measuring the customers confidence and commitment. The sample consisted of 108 which are around 23% response rate and questionnaires completed by customers who did receive direct mail. The authors were keen to know whether the customers relationship orientation toward their nominated firm had any bearing on their perception and that include information privacy concerns, trust of the use of data collected by companies, and receptivity to direct marketing. The findings have suggested that the customers relationship orientation may be positively influenced by responsible data use. One more study using a series of four focus groups to find out customer attitudes toward CRM in the service industry and found that few customers had not embraced CRM themselves because of an overriding wish to limit and control the boundaries of the relationship. (Kapoulas et al., (2004). In addition to this few customers had not appreciated nor wish to attempt to move towards CRM, whereas others favoured these latest moves. Further to this customer having a positive relationship orientation may be more prone to view relationship performance positively, or alternatively imprint specific expectations as to what that customer relationship should involve. (Garbarino & Johnson,1999). A case study of an industrial chemical manufacturer found that which is similar to energy

23 industry that customers do form further expectations from a relationship after CRM technology is adopted by the company. (Richard, Thirkell, & Huff, 2007). There was an expectation that CRM technology-enabled suppliers would understand and deal with customer issues better (e.g., reducing complaint, more accuracy in energy bills and improving communication management and those suppliers will have an enhanced overall understanding of the customers business and therefore better meet the customers exact requirement. Customers also supposed to have more frequent and productive customer-supplier meetings. The effect of a customer relationship orientation may moderate the relationship between suppliers and customers in highly competitive environment. Customers may develop expectations from a suppliers adoption of CRM technology, which may moderate certain aspects of the relationship performance. 2.9 CHAPTER SUMMARY The CRM research to date has revealed on CRM technology implementation concerns, understanding critical CRM success factors includes process, management and stakeholders, and highlighting CRM advantage for sales, marketing and the firm but hardly ever extended to the customer, ( Kapoulas et al., 2004)). Customer relationship management (CRM) is an important concept in todays time for marketing theory and practice. Other factors which also affect successfully implementation of CRM and affect CRM adoption and success that include: 1. Market orientation (Abbott et al., 2001) 2. IT management orientation. 3. The ability to build customer relationships. 4. People, process and technology issues, including CRM acceptance The choice to employ CRM technology can be a change mechanism for business reengineering at the same time focusing the business on contemporary metrics such as customer lifetime value, retention rate, and customer satisfaction (Shoemaker, 2001). Common argument found in the CRM marketing and its literature includes the impact of market orientation and the relationship between people and process. CRM research is also amplified in the areas of customer acquisition, development and retention and controlling churn ration. (Kamakura et al., 2005). Basically, CRM technology adoption is seen by both IT and marketing academics and researchers, and represented by vendors and academics, as a practical approach to relationship Marketing. Nevertheless there are few empirical studies which are linked up with CRM and RM. Further empirical research related to CRM and Relationship Management is required in order to help focus the different perspectives and consolidate the present conceptualisations and theory (Helfert et al., 2002). The level of management practices, reflecting the influence of CRM on business practices within a firm, has been shown to effect CRM performance outcomes with respect to customer satisfaction measures. (Karimi et al., 2001). However the main influence of such IT management practices on the adoption of CRM technology within the firm has not been completely examined .There are few more CRM studies specifically examining the significance of CRM

24 functionality adopted or level of CRM system arrangement within the firm. Although few studies explain the CRM functional mechanism in place at the time of the study (Abbott et al., 2001), most do not. Stefanou et al. (2003) and Raman and Pashupati (2004) are two studies that do reveal and gather CRM functionality and mixing data from respondents, but give limited discussion to the results. One more study found that the level of CRM technology adopted based on a hypothesised CRM process considered through formative indicators did not have a specific impact on economic performance (Reinartz et al., 2004).Nevertheless the impact of the extent of CRM approval within a firm on relationship strength and performance (i.e., customer satisfaction, retention and loyalty) has not been appropriately investigated or detailed (Raman & Pashupati, 2004; Stefanou et al., 2003). Other than few more technical related issues for CRM technology adoption and success, knowledge exploitation has also been shown to be important to the adoption and success of CRM, like a reflection of CRM usefulness.(Bose & Sugumaran, 2003).A small empirical CRM-related research was undertaken in the areas of commencement, expansion and sustaining customer relationships. It takes two for a relationship and the customer needs to view the offer for a relationship and its outcomes positively as well. (Fournier et al., 1998). Trust, commitment and communication between the company and customers have constantly been shown to assist create, nurture and improve a healthy customer relationships ( Morgan & Hunt, 1994), and these are basics for successful RM and CRM. Communication and trust are interlinked and a good communications supports trust building, and trust helps two-way, open communications. Relationships flourish when there is a balance, or stability between the core trust, commitment, and communication relational elements (Lewin & Johnston, 1997).These main relationship constructs have also been set up to assist and forecast relationship performance (Hausman, 2001).Improved relationship performance represents outcomes that are capable, productive and useful, and direct to supportive behaviour between customers, individuals or company(Berry, 1983) CRM technology is seen by some as a RM enabler with the capability to assist and create relationship between company and customers. (Bose, 2002). Without technology CRM implementation is very costly and it can be a lot of time consuming but technological advances give the assistance for efficiency gains (Berry, 1995).,Combining, customising, tracking, communicating, minimising errors, augmenting core services and personalising can be implemented quickly and cost effectively through technology (Berry, 1995). In order to help and overcome other related problems that the customers focused CRM sales and marketing automation may marginalise marketing and disperse customer focus, therefore additional marketing and IT cross-discipline investigation is necessary (Sheth 2002). It is utterly essential for company to understand, not only the impact of CRM adoption on relationship and business performance, but also the impact on relationship building since relationships are now considered the main tool to customer retention and controlling churn ration in highly competitive market. In order to create trust, commitment towards service or products given to the customers and a clear communications have been heavily researched with respect to CRM, however research gaps still exist in the area of CRM and RM.


These gaps are still apparent in resent time and these includes the discontinuity of CRM related research between the IT and marketing domains, the role of market orientation and IT management orientation in the acceptance, adoption and subsequent success of CRM technology within the firm, the impact of the level of CRM technology acceptance on creation, maintenance and enhancement of customer relationships, and the short of practical research connecting CRM technology adoption with RM theory and practice. (Stefanou et al., 2003). Research in these areas is not enough and that can be main factor contributing to apparently CRM not being fully successful. The important question which is not answered is: What is the impact of CRM in an energy company? And Can CRM improve sales effectiveness in an energy company? And customer relationship related performance. The next stage concentrates on these gaps in the research by presenting and developing the research model extensively in order to find out the CRM phenomenon and its affects on an energy companys strength and performance.



3.1 INTRODUCTION: Primary research is essential in order to deal with all set out objectives of this study. The method would demonstrate that how objectives were tried to achieve. It will provide detail understanding how each objective has been evaluated and what is the reason behind choosing respective method with all advantages and disadvantages. 3.2 RESEARCH OBJECTIVES: In order to achieve the research objectives, this dissertation topic is taking into consideration of both qualitative and quantitative research methodology, which is recognized as combination and that means to get the results from the two different places. (Green et al,2002). The combination of the both the methods make every effort to get a more complete, comprehensive, and contextual description of the observable fact in this dissertation, and is planned to neutralize unfairness in any one approach applied (Green et al., 2002). As per to Bonoma (cited in Lewin & Johnston, 2002), researchers can follow high levels of data validity and generalization by implementing triangulation approaches which give imitation and confirmation of findings across all methods and that includes experiments, case studies, surveys,. It has also been recommended that the combination of both research methods within a single project opens up massive opportunities for shared benefit, as inbuilt weaknesses of one approach can only be overcome by using another methods (Simon & Vosseberg , 2001). The Research Approach is a mixture of deductive and inductive approach. Deductive, because the existing concept of CRM and its importance on business decisions and strategy is first tested using data and inductive because the gathered data is analyzed to give new height to the CRM concept and its strategic effect on business decisions. Quantitative and qualitative methods of data collection technique are taken into consideration, while the major part of the research is focused on qualitative data and its analysis. Qualitative secondary information from a variety of sources are gathered like , Southern Electric brochures, Southern Electric Web page , Reference books , Journals , Online journals and Articles, semi structured interviews, service comparison website (e.g. Uswitch) databases. Quantitative data from Southern Electric website information has been collected and analyzed to compare and contrast the importance of CRM and its effect in todays time in this cut throat competition period. The main objectives of this extensive study are below mentioned:


What is the role of CRM in an energy companys performance? Do employers encourage the relationship between CRM and the employees? Does CRM encourage company for better customer service? Can CRM improve sales effectiveness in an energy company?

Before reaching to conclusion of selecting ultimate research methodology each research objective was taken into consideration and each option was considered separately and a detailed analysis was done for each data collection approach against each objective. A proper justification was established behind each research method before going further on. It was made sure that the data collection methods were more or less mutually supporting so that each method fulfilled or covered the areas which could not be covered by the other. Original secondary data collection method included reading through the relevant material in Books, Journals, Company websites, related article, company reports, and southern electric website and so on. Different Keywords were then used to refine the search. Keywords Used: - Customer Relation Management, Relationship Marketing, and Customer relationship management, Strategy of service industry, Buyer behaviour, and Customer loyalty. Primary data collection methods were embarked on only after sufficient insight that had been gained from secondary data. Most of the secondary data was collected and analysed and before that the Customer relationship management concepts were fully understood. The minimum criteria was set in order to obtain accurate result that includes at least one of internal retail sales manager, senior marketing executive or marketing manager, call centre manager, senior executive with regular customer contact and it was ensure everyone should have willingness to take part in the research by providing customer relationship data, and at least one accessible and willing customer who can participate it can also be any employee who is taking energy services from southern electric. These criteria ensured that all participants were able and willing to participate on schedule time and could contribute valuable and relevant information. In order to fulfil objectives focus groups and semi structured interview were conducted to expose not only behavioural but attitudinal aspects of CRM and to interpret if CRM can improve sales effectiveness or is it just another marketing instrument. Focus groups are a cognitive form of qualitative research. There is less formation to the group, with group members are encouraged to take their own paths of discussion, make their own links up and for the whole process to develop. It looks to summarize the experiences and feelings of respondents in their own expressions. The purpose of the dissertation is

29 revealed to the respondents or else understandable to them from the questions which will be asked. The concept of Focus group was hired from general human psychology where it has been recognized that people can be encouraged to speak up when they are in the group rather than being individual speaker. (Edmunds,1999). It has a strong effect so that a comment from one person ignites ideas from another and groups can get more ideas than one to one interviews. However, focus groups also have drawbacks: the researcher has less control over a group comparatively over one-on-one interview, so time can be lost on issues which may be irrelevant to the topic and data difficult to analyze because the talking in response to comments by members of another group and observers should be highly qualified, and groups are vary and may be difficult to invite at the same time. Furthermore, the numbers of team members are not large enough to be a representative sample of the total population: thus, the data obtained from the groups are not necessarily representative of the population, in contrast to data from opinion polls. Focus groups reveal companys viewpoint and perception and looks at how CRM can encourage employees and company for the better out put. From historical support it is found that women and old people were more loyal in their habits for choosing service provider for their energy and do not consider other factors while men and especially young people are the most inconsistent and are tend to change their mind so often. The variables taken into consideration in the formation of focus groups were Age, Gender, Income, Education and Accessibility of internet. The details of the participants were attempted to match up against the required result and employees from different department were invited to make sure that the conclusions drawn were statistically considerable. Employees were chosen in a way to ensure that the conclusions which were obtained were statistically significant. Focus groups gave viewpoint on satisfaction with overall service and its significant, and what kind of service they preferred and what changes they thought would make them to buy energy services from Southern Electric. It also gave close idea about customers perception about CRM and whether they built any longer term relationship for the reason that of CRM. Focus groups assisted to gain sufficient insight what customers actual requirement in todays time. That was the first stage of primary data collection, five focus group sessions were conducted together and the number of participants ranged from nearly 6 to 9. Focus group provided real help to achieve Objective 1. The main benefit of interviewing company employees is that it is comparatively manageable and inexpensive; nevertheless, the downside of this method is that there are no much statistical techniques are available to calculate the random sampling error and as a result it does not permit the researcher to plan the data beyond the sample (Zikmund, 2000)


3.2.1 DIFFERENCE BETWEEN QUALITATIVE AND QUANTITATIVE: Adapted from Neill (2007) Qualitative versus quantitative research: key points in a classic debate.

Qualitative "All research ultimately has a qualitative grounding" - Donald Campbell

Quantitative "There's no such thing as qualitative data. Everything is either 1 or 0"

The aim is a complete, detailed description.

The aim is to classify features, count them, and construct statistical models in an attempt to explain what is observed. Researcher knows clearly in advance what he/she is looking for. Recommended during latter phases of research projects. All aspects of the study are carefully designed before data is collected.

Researcher may only know roughly in advance what he/she is looking for. Recommended during earlier phases of research projects. The design emerges as the study unfolds.


Researcher is the data gathering instrument.

Researcher uses tools, such as questionnaires or equipment to collect numerical data. Data is in the form of numbers and statistics. Objective seeks precise measurement & analysis of target concepts, e.g., uses surveys, questionnaires etc. Quantitative data is more efficient, able to test hypotheses, but may miss contextual detail. Researcher tends to remain objectively separated from the subject matter.

Data is in the form of words, pictures or objects. Subjective - individuals interpretation of events is important ,e.g., uses participant observation, indepth interviews etc. Qualitative data is more 'rich', time consuming, and less able to be generalized. Researcher tends to become subjectively immersed in the subject matter.

Neill (2007) Qualitative v/s quantitative research: key points in debate. (Online) In order to achieve all objectives it is decided to use a quantitative and qualitative approach and that was on the grounds that a large representative sample is required. Qualitative research is principally based on in depth interviews and focus groups but here focus group method has been used. Therefore this method is regarded to be suitable to the study. It is very important that there is unbiased study and analysis of data. One such possible scenario with using a focus group could be that one employee could easily influence other respondents or control the group to a particular direction. Further to this, it was also stated by McDaniel and Gates (2006) as it required really good skill to conduct sophisticated focus group. it is obvious that in order to achieve the required information the interviewer required a good skill and great presence of mind. It is known that focus groups are a positive medium for understanding emotions and attitudes. Although, with the help of using both qualitative and quantitative techniques in the survey, it is assumed that this understanding can be gained to an extent on a larger level and at considerably low expense.


3.3 ANALYSIS OF DATA Results and analysis of the data is gathered by using a table by showing percentages of participants response. General computer skills have been used to gather statistical information about the response of all participants. All the questions with the answers have been attached in appendices. 3.4 QUESTINNAIRE DESIGN The questionnaire symbolizes main part of the survey process. It is, therefore a very important part of the study. A poorly formed questionnaire will not present the data that are actually required or, poorer questions will provide data that are incorrect. (Bruce, 2004). As the questionnaire is the principal data collection method, it is imperative that the questions are suitable to what this dissertation study intends to achieve. The main focus should be on using the appropriate terminology and it should be appropriate enough to get the required information from the respondents. 3.4.1 QUESTIONNAIRE CONSTRUCTION METHOD McNabb (2004, page 151) has made an EightStep questionnaire construction procedure.

Source: McNabb(2004) Malhotra (1999)( cited in McNabb, 2004, pg 151) states that while preparing of a questionnaire the researcher have to pursue an organized procedure in order to make sure that it performs three broad objectives. The questionnaire must: 1). Effectively collect information that answers each and every study question. 2). Inspire respondents to answer to the best of their capability. 3). Keep all possible error to a minimum level.

33 Bearing this fact in mind, the above questionnaire construction table has been used to prepare questionnaire. 3.4.2 JUSTIFICATION OF THE QUESTIONS The initial aims for the survey have been understood from the secondary data. This has recognized the areas to address by providing a route for the questionnaire. Questions have been designed in a way where the participants have enough opportunity to express themselves (Punch, 2003). 3.4.3 QUESTION TYPES AND WORDING It is very important that the questionnaire has been constructed using clear and to the point language and avoiding double meaning questions and jargon to evade any avoidable confusion. Bruce (2004, pg 8) has defined a questionnaire writer who is not familiar with the vocabulary of a market can very quickly come unstuck. The participants have been invited from the different department however most of the employees are from customer service, marketing, call centre and direct sales. It is very important to get view from different department but as this study is based on CRM only those employees have been invited who are quite close to CRM or else it does not make any significant impact on the out come so this work has been done with utmost care. It is also observed one matter is seen from different point of view by both gender and it is likely to have bias view by different age group. It was determined that the use of pre coded groups was the best available method. The questionnaires are made of predominantly of only multiple choice and closed questions have been avoided. It was set up that the multiple choice questions allowed respondents to point out their views as well as allowing more liberty for their answers rather than just yes or No to be noted. The dichotomous questions were deliberately limited to five alternatives as this is much easy to manage but it also makes sure relatively fast answer from respondents, so that a better understanding of respondents opinions can be gained to allow for a more detailed measurement of attitudes. Questions within the questionnaire have been graded using a scale of one to five where respondents are given advice to tick the response options that best show their positions on each item. The justification for adopting a fivepoint scale is to make sure that respondents have enough choice of responses which can represent their perception and it will also raise the response rate and superiority of responses, further to this, this approach allows for attitudes to be calculated and analysed precisely. In order to achieve Objective 4 it has been decided to arrange semi structured interview with the regional sales manager of southern electric and branch sales manager and assistant branch manager for London branch will also be invited so that detail information can be gathered and gained information can be investigated. Semi structured interview can be arranged for both to receive information and pass on information. This method is quite different than questionnaire method because detail questions are framed before such interviews are conducted and interviewer has chance to create some more questions as and when they find any related information can be retrieved this argument has also been supported by The main strength of

34 this method is that it is cost effective and it does not require any prolong preparation as it allows both interviewer and the person who is being questioned the flexibility of time and detail information on asked question. The main weakness for this method is again it requires good questioning skill otherwise it can lead to unnecessary argument and eventually waste of time. Interviewer should remain focus all the time and should monitor relentlessly to make sure only relevant information is being exchanged. The addition of an open question has been included in the questionnaire of the focus group this is mainly to let respondents to use their own expressions without restrict their choices and any minor error which can prevent respondents to express themselves freely can be overcome. In addition to this it will give a chance for the interviewer to give confidence to respondents to expand and enlarge their answers and disclose more information. However analysis of this data will not be as straight forward as the closed questions, it was decided that they could support the gained data from the previous questions and expose more information with regards to their attitudes. 3.4.4 QUESTIONNAIRE LAYOUT Cohen and Manion (1994), stated that the out look of the questionnaire is very important. It has to be easy, attractive and interesting rather than tough, unclear, forbidding and boring, it is vital for respondents to be introduced to the purposes of each section of a questionnaire, so that they can be involved in it and maybe identify with it. If space permits, it is useful to tell the respondent the purposes of the questionnaire. The questionnaire will start build up connection through the introductory speech detailing the topic and the reason for carrying it out and once initial contact was made, the opening question in the questionnaire made sure everyone was qualified. A required answer will be followed by a short description of the respondent and multiple choice questions which can be answered rapidly and correctly. 3.5 SAMPLE SELECTION PROCEDURE It has been decided in order to achieve objective 1 focus group did seem the best possible option therefore approximately 50 respondents shall be selected from different departments. All employees of Southern Electric from England but the size of the sample has had to be relatively limited and that is because of available time, availability of employees and money. This also can be known as convenience sampling in which the sampling selection process is carried until desired sample size is reached. (Saunders et al., 2003). In addition to this most of the employees who were invited it was made sure they are from the department where they deal with CRM directly or indirectly. It is believed that probability sampling will be suitable method so that there is a strict criterion for respondents should be direct Southern Electric employees( i.e contractual employees have been eliminated from this survey) and minimum length with the company should be minimum two years as this can be very sensitive in case of data

35 collection. Using this process will remove any possible error and ensure a fair method of selecting respondents. Prospective respondents will be approached by respective head of the department and invited for the interview by considering it does not affect their routine work. The times and dates in which this research had been carried out were sadly constrained by the periods that Southern Electric allowed. The questionnaire was carried out on different dates as travelling was needed and allowed time was almost the same. The following are the dates and times: 3rd May 2010 10.30am 11.00am 10 4th may 2010 9.30am 10.00am 9 5th May 2010 9.30am 10.00am 10 6th May 2010 9.30am 10.00am 11 7th May 2010 - 9.30am 10.00am 10 . TOTAL = 50 3.6 STRENGTHS,LIMITATION AND VALIDITY The planned method of collecting data through questionnaires is similar to any form of research which is used elsewhere, it has its qualities but it also contains restrictions and subject of validity. McNabb (2004, pg 150) defines Questionnaires have many advantages. The greatest of these is the considerable flexibility of the questionnaire. Questionnaires can be customdesigned to meet the objectives of almost any type of research paper. 3.6.1 STRENHTHS The method allows responses to be gathered in a proper way, resulting in the data being more purposeful; in addition, these obtained results reduce bias and allows respondents to talk freely. The collected information can also be presented in numerical and graphical form. This will help the platform of a structured logical analysis and, if needed, this can also be reanalysed by others. 3.6.2 LIMITATION It is highly likely as that participants may forget some key issues while giving answers and do not understand the important of this survey. As Clarke and Crichter (1985) have commented there is always difference between what people say and what people actually do. This is applied in such research methods however this factor has to be consideration when carrying out an analysis. The time limit given by Southern Electric for when the questionnaire can be completed will not be 100% error proof. Because of such restrictions, data will only be obtained in the morning where employees are likely not to have brain storming session. The survey is conducted as per the guidelines and instruction given by respective head of the department and within the allocated time period.

36 Moreover, participants may answer superficially, although the questionnaire is designed to be relatively short so these issues can be overcome. 3.6.3 VALIDITY As far as questionnaires are concerned its validity may depend mainly on reliability. As per Reliability is a characteristic of the instrument itself, but validity comes from the way the instrument is employed. If a questionnaire is revealed to be defective then there is no discussion of validity. Veal (1997, pg 186) states that validity is the extent to which the questionnaires accurately reflect what they are meant to reflect. It is also cited on as validity refers to whether the questionnaire or survey measures what it intends to measure. As per Belson (1986, pg 13).In the interview, authenticity can be compromised by collection of scenarios and circumstances. For example, if participants are in a rush to finish the questionnaire this can affect their responses, further to this, it is also likely that participants give exaggerated responses or totally fail to understand the questions as it is aimed by its designer. 3.7 SUMMARY The actual process of data collection has been defined and agreed with validation in this chapter of the dissertation. Using this method as a research tool and mixing quantitative and qualitative research methods will successfully answer the aims of the study. The next chapter will give the research findings and provides investigation of the findings.



4.1 INTRODUCTION: This chapter is on the presentation and data analysis of the details gained through research methodology. In order to get answer for objective 1 and objective 4 qualitative methods was used therefore focus group and semi structured interviews were carried out. Analysis of focus group has provided vital information pertaining to respective objectives. In order to find answer for objective 2 and objective 3 quantitative methods was used. These findings and findings from the secondary data will provide all required answers. The main aspects of CRM which encourage employees for the better out come will be examined and analysed thoroughly. The factors which have led to the success of CRM and encourage company for the better out come will be highlighted. The results from the quantitative and qualitative research have been correlated and investigated. This part of the study provides the essential information and data which are required to meet the objective of this dissertation. 4.2 ANALYSIS AND RESULTS From the previous chapter it was decided that there are few areas which are required to establish. This section has been divided into two parts in order to evaluate results for all objectives. Objective 1 and objective 4 have been investigated with the help of focus group and semi structured interview and Objective 2 and objective 3 have been investigated with the help of questionnaires. This enables to present the results in a manner which can be analysed easily also table with percentages of the answers have also been displayed for the easy numerical understanding of the data. As discussed earlier, two different methods have been used to achieve result for this study. Focus group helped to give detail insight on how employees see CRM for the company ,semi structured interview with the sales manager helped to get detail insight how CRM can be useful in order to increase sales effectiveness . As this study is purely on CRM so only those employees were invited who have to work with CRM either directly or indirectly in the focus group. It was also made sure only those employees whose length of service is at least more than two years. These strict criterions were used just to make sure the obtained result is authentic and accurate. 4.2.1 OBJECTIVE 1: Objective 1 is to get in depth knowledge on CRM and its role in the energy companys performance. There is hardly any industry which is not affected from fierce competition and as far as energy companies are concerned, they are facing cut throat competition at this time in the UK. Therefore CRM is very important for the energy company and it is even important to know the role of CRM in the energy companys performance. In order to get accurate result of this objective focus group was conducted and it gave good idea about how management see CRM for southern electric. Focus group was comprised with all employees from different department especially from customer contact centre, customer service, sales and marketing and retention department.


Focus group revealed Southern Electric which is a part of Scottish and southern energy started looking for CRM related activity and first major step was to hire agency as this concept was fairly unknown to the company for that period and after privatization it was mandatory to improve customer service. In the mid 1995 Southern electric announced it would hire company called STORY UK LTD which is Scotland based company. Story UK is specialised in CRM related activity and helps company to improve overall all activity related to CRM. Focus group also revealed that this step was very crucial and proved to be very beneficial for the company, before Story Ltd was appointed Southern electric was the client of The Leith Agency and The Union respectively. The main reason to change from the previous agency was company seemed to deteriorate in its customer service and marketing activity. Company was also facing tough competition from British Gas and EDF which are Southern Electrics arch rival. Story UK was given responsibility for developing SSE's utility brands, which include Southern Electric to manage CRM, related activity. In March 2006, Southern electric started increasing focus on collecting and managing customer information with the help of increased its focus on gathering and managing customer information with the help of appointing data collection agency called Eurodirect and main responsibilty was for the agency to smoothen customer change over process from the competitors and imprving the targeting of potential customer. Eurodirect played vital role and helped Southern Electric to achieve its goals by providing customer related data which helped company to manoeuvre its strategy in order to gain new customers and their perception how and what basis they select an energy company. Southern Electric was able to acknowledge only competitive rate for the product is not only the criteria to get new customers because the most important thing is to retain them to avoid future marketing expenses or to reduce it. With the help of this agency company collaborated with AIRMILES and started giving Air Miles to customers who join them and customers can accumulate till the time they are with the company and this move helped Southern electric to retain customers. With the help of all gathered data company also discovered customer satisfaction should be the main priority and in order to gain competitive advantage company also started customised on line services for those customers who do not want to call and this helped company to satisfy customer needs and made possible for customers to give online meter reading, viewing bill and so on. This decision was proved to be succesful and company gained number 1 spot for customer service along with Scottish power and this award was given by very well known J.D Power and Associates. Focus group also revealed management was quite sceptical on appointing Story Ltd because when Southern electric appointed the Story Ltd ,Southern Electric was the first utility client for them and Story ltd had worked with HSBC ,Stagecoach and standrd life insurance which are finance related companies but after all it turned out to be very useful for southern Electric. With the help of Eurodirect southern electric found out

40 totally different and innovative way to gain more customers and increase its customer base.Soutehrn electric did tie up with AirMiles and those customers who choose southern electric as their energy compny they were given Airmiles and they were promised to be given AitMiles till the time they are with Southern Electric. This programme became very popular in customers and it helped company to gain more customers and also retain most of the customer. Focus company revealed Southern electric focuses more on customer satisfaction than any other compnay with the help of data analysis Southern Electric came up with new ways to provide meter reading over the internet and it helped to reduce many compaints about estimated meter reading.This was very important step as competitiors were facing problem to keep bills accurate. Focus group also revealed how Southern lectric with the help of CRM was able to reduce waiting time for the custmer when they called Southern electric call cente. One of the group members said CRM is not over night process it should be monitored all the time and have to make necessary changes which are beneficial to both company and customers. CRM was fairly new concept in 2005 for the company and company waited for five long years to get the positive reports from it. One of the senior member from the focus group said Southern electric which is a part of Scottish and Southern energy gained second largest company in 2008 from the fourth largest company in year 2005 and Southern electric increased their customer base from 6.5 million in 2005 to 9.75 million in 2010. All participants believed this phenominal growth has only been possible due to CRM. Focus group helped to get detail knowledge on CRM and its role in the energy company.CRM provides fundmental facility to all employees to cope up with the customer oriented industry. CRM helps improving customer contact cente overall quality,it also helps by providing customised facility over the internet,CRM also identifies area which can be targeted to gain more customers and finally it helps gained customers to keep with the company for the longer period. 4.2.2 OBJECTIVE 2 AND OBJECTIVE 3: In order to achieve Objective 2 and 3 it was predetermined to take quantitative approach and therefore questionnaires were prepared to get best possible results of this objectives.The main reason to get result of this study was to relate how employers encourage relationship between CRM and the employees and the factors which help company for the better customer service. Altogether 50 particpants were welcomed and all of them were given questionaires with five possible answeres so that they have enough liberty to choose the nearest one.The main benefit of this method is, it doesnt restrict partcipants to express them freely. Simple analytical analysis was performed so that result can be analysed accurately. All answers were coded with 1 to 5 so that analysis of this questionaires can be done easily where 1 indicates strongly agree, this is mainly to capture confidence level of respondent it is followed by 2 which indicates agree where respondent can fairly say yes to the statement after that it is followed by 3 which indicates neutral, this is mainly to give enough liberty to respondents if they do not want to agree or disagree they can opt out or any statement they can avoid instead of giving any influence on over all results. It is followed by 4 which indicates disagree and 5 indicates strongly disagree. Respondents were asked 20 questions and they were told to tick nearest possible alternative what they feel is correct. Average score has also been calculated so that it becomes easier to get result which is nearer to the objective. It

41 has been calculated by using simple maths technique; the formula used for first figure is below mentioned. Example for figure [1*20+2*10+3*5+4*10+5*5 = 120/50 = 2.4] 1 When the CRM project was launched initially it was really difficult to adopt because of all the complexities. But finally it has been possible to get used to it because of support and commitment from the management.
1 20 40% 2 10 20% 3 5 10% 4 10 20% 5 5 10% Total 50 100%

Average score for this statement is 2.4 The above statement relates the support what employees get from their employer or management and overall score suggests that most of the employees seemed to be satisfied the way they are supported for CRM related activity. 2 The employees were finding difficult the way system used to work but after the implementation of CRM, the employees are much happy with dealing with the problems.

1 16 32%

2 12 24%

3 8 16%

4 9 18%

5 5 10%

Total 50 100%

Average score for this statement is 2.5 The above statement is to measure after the implementation of CRM how employees were able to cope up with work load and overall score suggests that CRM software has helped to make work easier. 3 The CRM system has been designed to improve and boost sales from current customers and has been important tool to retain customers switching to competitors.



1 12 24%

2 11 22%

3 7 14%

4 14 28%

5 6 12%

Total 50 100%

Average score for this statement is 2.82 The average score suggests that employees fairly think CRM has helped retaining customer fairly but it is also concerned for the company that almost 40% employees still think it is to be improved so this is something what company has to consider it either by improving it or educating employees how to make best use of the CRM structure. 4 The system was really complex and difficult to adopt and therefore one was not looking forward to the get on with it.
1 5 10% 2 6 12% 3 9 18% 4 20 40% 5 10 20% Total 50 100%

Average score for this statement is 3.48 The above statement is to capture attitude of employees so in future new ways can be adopted where there is any major changes in CRM system, The above statement suggest that CRM system was indeed difficult and it was difficult to understand so in the future company can put effort in this area. 5 Organizational factors that supported CRM-led changes, which eventually changed the entire organizational culture.
1 10 20% 2 8 16% 3 9 18% 4 10 20% 5 13 26% Total 50 100%

Average score for this statement is 3.16 The above statement has been asked to get more idea about how employees think in terms of post changes in the company after implementing CRM. The average score suggests that CRM has very little impact on overall change in terms of culture of the company. 6 The culture in this company insists too much competition with other companies and therefore I believe that was main reason for the usage of CRM.


1 15 30%

2 12 24%

3 6 12%

4 10 20%

5 7 14%

Total 50 100%

Average score for this statement is 2.64 The above statement has been used to capture employees perception about CRM and the average score suggests that most of the employees are agree with it. 7 Our manager was very supportive throughout the CRM related activity; I felt I am learning something new for better.
1 10 20% 2 15 30% 3 10 20% 4 8 16% 5 7 14% Total 50 100%

Average score for this statement is 2.74 The above statement is to find out that employees think whether they are getting enough encouragement to use CRM tool for overall success or not and it is a good sign for any company that message is sent across to make sure everyone is aware why new system is being introduced. The overall score suggests that overall employees think they get enough support from the management. 8 In this time everything is revolved around the customer, and thats how we are asked to organize our tasks and strategy, here CRM gives vital help.
1 15 30% 2 10 20% 3 6 12% 4 12 24% 5 7 14% Total 50 100%

Average score for this statement is 2.72 The above statement is to check whether CRM encourage employees for better customer service and again the average score indicates that majority of employees think the CRM is the driving force for them to provide customer service. 9 I dont like to be trained so often; specially with the new system I am not familiar with.

1 11 22% 2 10 20% 3 5 10% 4 15 30% 5 9 18% Total 50 100%

Average score for this statement is 3.02 The above statement is to check the attitude and perception of employees so before employers make any changes in CRM function it is vital to evaluate how employees are going to see that change and how it is going to affect customer service. 10 CRM is vital for all employees and that is the only way we can cope up with rising competition and it enables us to deal with customers demand in correct way.
1 20 40% 2 10 20% 3 7 14% 4 8 16% 5 5 10% Total 50 100%

Average score for this statement is 2.36 The above statement is to check common opinion of all employees on CRM and why do they think it is really useful to use CRM effectively in order to remain competitive. The average score for this statement suggests that all respondents are agree and positive that with the help of CRM it is easy to deal with the competition. 11 The companys CRM software is great and user friendly therefore I can work much faster and effectively.

1 20 40%

2 17 20%

3 4 10%

4 4 20%

5 5 10%

Total 50 100%

Average score for this statement is 2.14 CRM is useful and there is no doubt about it but it is equally important for company to know how that system is being used and how friendly it is for employees to use. The above statement is to check whether current CRM software is creating any problems for users or not but from the average answer from the respondents it is observed that the current CRM tool is user friendly for the users and it does not affect overall customer service. 12 With the help of CRM, work load has reduced and it help the employees to sell Companys other products to the customers. This is much better than previous years

45 where it was required to ask more questions just to get idea about suitability for the other products to the customer.
1 18 36% 2 14 28% 3 8 16% 4 5 10% 5 5 10% Total 50 100%

Average score for this statement is 2.30 The above statement indicates whether employee feels that they are getting enough help from the employer in order to reduce work load or that type of encouragement to use CRM, the average answer for above statement indicates that majority of respondents agree that CRM gives that help to deal and ease work load. 13 With the help of CRM significant growth has been established.
1 13 26% 2 16 32% 3 7 14% 4 7 14% 5 7 14% Total 50 100%

Average score for this statement is 2.58 The above statement has been asked to notice whether users feel any difference after implementing CRM and response from respondents indicates majority of them are agree with the above statement. Southern Electric was finding difficult before 2005 but after launching CRM effectively company has achieved phenomenal growth. 14 CRM has played vital part in improving all activity from marketing to retaining the customers.
1 9 18% 2 21 42% 3 5 10% 4 6 12% 5 8 16% Total 50 100%

Average score for this statement is 2.60 The above statement has been asked to get in depth understanding the overall usage of CRM whether it has been restricted only for marketing or it has been use for all other departments and the average score indicates that most of the employees believe that CRM has played vital role in overall improvement of the company. 15 With the effective use of CRM, the company has gained the second rank in 2010 from previous rank of fourth in 2005 in the utility market.


1 15 30% 2 9 18% 3 6 12% 4 6 12% 5 14 28% Total 50 100%

Average score for this statement is 2.90 The above statement has been designed to check the driving force for employees to use CRM and how they see it because any employee wants to work with successful company and in order to be on the top any company should have unique which other companies dont have from the average score it is observed most of the respondents are fairly agree with the statement. 16 CRM has reduced overall cost of the company and has improved ROI. (Returns on investment)
1 10 20% 2 6 12% 3 6 12% 4 14 28% 5 14 28% Total 50 100%

Average score for this statement is 3.32 The average answer for the above statement is a bit concern for the company as majority of respondents are not agree with it , the clear reason behind is company has to do something in order to improve the usage of CRM to cut the cost and improve total ROI. 17 Severe competitions amongst energy companies and modernization have compelled the company to use CRM.
1 18 36% 2 10 20% 3 8 16% 4 9 18% 5 5 10% Total 50 100%

Average score for this statement is 2.46 The above statement has been asked to check whether CRM provides encouragement to employees for better customer service and average score for this statement shows that CRM has direct relationship and it drives employees to use it to cope up with rising competition. 18 CRM has made employees job less complex and faster.


1 15 30% 2 18 38% 3 9 18% 4 5 10% 5 3 6% Total 50 100%

Average score for this statement is 2.26 The above statement has been designed to check whether employees get encouraged to use CRM or not, apparently if not in that case entire exercise for using CRM is vain but the overall score suggests that employers are successful in terms of providing encouragement to the employees for using CRM. 19 CRM has increased the creditability of customer contact centre and has helped to gain number one position for customer service in the energy market.
1 10 20% 2 20 40% 3 9 18% 4 7 14% 5 4 8% Total 50 100%

Average score for this statement is 2.10 The above statement has been designed to check how employers provide encouragement to employees in terms of using CRM; it is evident from the average answer that employers have been fairly successful to provide enough encouragement to maintain relationship between CRM and employees. 20 CRM has provided more opportunity to compete against competitors therefore there is no waste of time and quality of work is rated frequently?

1 12 24%

2 14 28%

3 9 18%

4 11 22%

5 4 8%

Total 50 100%

Average score for this statement is 2.62 The above statement has been framed in order to capture the actual effect on employees after implementing CRM, the main benefits which drive employees to use CRM effectively and again the main source of motivation which is provided by employers. The average score suggests that employees are fairly content the way CRM is monitored and encouragement what they have been given. 4.2.3 OBJECTIVE: 4


This technique is normally used to collect data by asking questions and it gives freedom to respondent to take their time and think. The reason behind using this method is to get as accurate result as possible. This objective is purely based on sales so it was necesssary to take interviews of people who are directly related to sales, therefore area sales managers, branch manager of London and regional manager of lonodn were selected. The main benefit is to select this method is to undestand point of veiw of all and reaching to general conclusion rathern than generalising about their behaviour. In this method open ended questions have been asked which normally start with Tell me about this or you told this if you can tell more about this?The wordings of questions were not the same for all respondents. The semi structured interview with all managers were very useful and proved to be very successful in terms of getting answer of this objective. These interviews revealed that CRM has played really important role for Southern electric. One manager revealed CRM changed the way business was being done especially for sales people it was very useful. Southern Electric exploited Eurodirect which provided important data related to customers and marketing people targeted and it helped increasing customer base from 6.5 million to 9.25 million in 2010. Regional manager explained with the help of CRM Company realised direct selling is very crucial as energy buying is never interesting for consumers so better targeting customers in their homes and in order to create confidence amongst customers and in order to gain trust company became founder member of an independent agency called Energysure which protect customers against miss selling and provides help. Area sales manager revealed that the analysis of customers data through CRM helped company to gain understanding of customers perception on buying energy and customers were targeted through email urging them to buy energy over the website it was very effective in reducing companys overall administration cost compare to direct selling. It also helped company to draw attention of consumers group who want to join company which supports greener way compare to direct mails. One of the senior managers revealed that information from sales team is gathered, stored and analysed and it is used while forming a new strategy and company also encourage sales people who actively contribute such information. The majority of employees were quite positive and affirmed that CRM has been very important and helped company indisputably achieving larger market share in very short duration. Effective use of CRM has helped company be on the top list for customer satisfaction and it is helping to retain more customers and gaining new customers.


After the conclusion of the primary research, few new findings have been gained and the main objective of this extensive study has been fulfilled. The results revealed the importance of CRM and how it added value to overall companys performance and how

49 company get encouraged for better customer service and that is very important in this fierce competition. It also helped in clarifying some basic areas. The result from the questionnaires state that employees get well encouragement for better companys performance. Most of the respondents are quite content and believe that CRM encourages company for better customer service. However, after the accomplishment of all objectives which relate CRMs importance in an energy company in this study the result demonstrates that there is still to be done and it is employers responsibility to encourage employees to be ready for rapid change. There has been no evidence or support the theory that only because of usage of CRM Southern Electric has gained number one spot in energy industry. Particular attention can be drawn to employees loyalty towards companys overall success, further to this there are few more issues which have to be consider such as customer loyalty, complex and erroneous methods which prevent customers to change energy provider, lack of transparency and government s ineffective role in maintaining monopoly free market. These are few issues which indirectly support most of the companies to gain some advantage and prevent fair competition.


5.1 INTRODUCTION The main reason of this study was to find out the importance of the CRM in an energy company, therefore Southern electric was selected for study purpose and detail research

51 was conducted as case study, further to this it revealed the phenomenal success of southern electric in last few years was mainly due to effective use of CRM. The primary data and its detail research revealed key points and also answered all objectives of this dissertation which is outlined in the first chapter. This last chapter will show the main results of this study and focusing on the objectives rather than making recommendation straight away and this will be followed by the areas which need to be investigated further. 5.2 CONCLUSION OF THE STUDY The literature review has drawn attention that the importance of CRM in an energy companies can not be neglected and hence its role for companys success is very vital. Ideally Southern Electric implemented CRM related all activity in year 2005 and by 2010 it was second largest company in the U.K and became number one company for customer service. Southern Electric also hired agency for data collection and it helped company to target potential customer base. It was discovered from the primary research that CRM is the main driving source for companys success. CRM alone has put company on the first place. The study has also revealed that the number of modus operandi which exists to be customer centric and cost effective. Further to this, this dissertation has recognized and identifies the importance of CRM implementation in a way to reduce overall reduction in the companys marketing cost and better ROI, and better customer service has eventually helped to gain customer loyalty which is intangible assets for any company in this highly competitive market. Southern electric continues to improve customer service in order to make sure customers are happy and content with the company so the main objective of CRM can be fulfilled to retain customers. The study also has shown that customers have changed the view in selecting their energy provider and the perception and their attitude towards the products have changed completely. In addition to this massive investment in greener electricity and being number one for generating maximum electricity from renewable energy has drawn attention from different consumers group who emphasis more rather than price of the products. Parker and Worthington (2000, pg 496), have stated that consumers are ignorant, but overall results from this dissertation dispute and contradict this statement. The primary research from the objective 2 and 3 that company has provided sufficient encouragement to the employees as it is observed in all answers and that has helped company for the better customer service. As consumer now uses different way to get information about available choices specially on internet, so it is presumed that customers keep changing their energy provider so often to meet their own requirements and here better customer service play very important role. Primary research also revealed that one of the important features of employing CRM is to reduce overall cost by targeting new customers with the information gathered from the agency as it was revealed by the focus group. It was also revealed that Southern

52 electric has lowest customer churn ration in the energy market. Southern Electric has got more loyal customers than before. Parker and Worthington (2000, pg 496) have also stated that loyalty cannot be bought. In other words it can be interpreted that Southern Electric has got valuable assets and it can be competitive advantage over its rivals and this is mainly because of effective use of CRM. The finding from the secondary research have shown that there are few factors which can be real threat for the Southern Electric and these are below mentioned: (1) Competitors: The similar level of CRM implementation and more customer centric tactics have been introduced by most of the company. (2) External Environments: New trend to allure customers have been in to the effect especially mutual tie ups with super markets have threatened company to look more specific ways to retain customers and improve customer service with even better usage of CRM. (3) Perception: Secondary data revealed that employees perceptions towards CRM in specific situation is not yet clear and it seemed they needed more support from employers to deal with complex situations. 5.3 RECOMMENDATION Study has well established that majority of employees are fairly happy with the CRM facility and its usage in the company, but it is also important for the employers to be cautious and look all changes which are happening in the energy industry. There is no doubt that Southern Electric has exploited CRM and has reaped good results and that is the main reason company has been successful in the energy market. In spite of this accomplishment secondary study has found that it is becoming common for most of the company to improve overall functioning of CRM so company should also consider new and innovative ways to deal with the rising threat of existing companies or new market entrants.

On the basis of this conclusion few suggestions can be made: (1) Investigate new ways to deal with rising competition instead of solely relying only on CRM based activity. (2) Examine and solve the current existing problems which are faced by employees because by giving newer CRM system to deal with the problems that is not going to resolve all problems, company has to believe in order to generate loyal customer first need to generate loyal employees. (3) Evolve and transform the way data is gathered for marketing purpose because energy market is constantly changing and consumers need more customised service. 5.4 Limitations and Further Research

53 This study has not been established without any limitation, the main area is the questionnaires size. It is believed that it does not represent the entire employee base of the company to know the perception about how they feel about CRM and its importance. Further to this time and dates for this research was unfortunately controlled by Southern Electric. Time and money are other factors and due to which this study is in the limit up to certain extent. Southern Electric would not have allowed to ask specific questions and given time was very short. The result of this study is also limited because few employees didnt turn up at time and had to select other employees from the different department who were not as nearer to those who didnt turn up on the time. Further to this it is also believed if all desired employees would have appeared result might slightly have changed and carried results could have helped to investigate and support the original results. The proposed research only focused on CRMs importance, nevertheless it would have been advantageous to expand the research to customers and get some insight of how they actually feel about companys performance it would have been possible to get some knowledge from the customers who have been with Southern Electric for longer period and interesting results could have been gained.


Anderson, K. & Kerr, C. (2002) Customer relationship management. USA: Mc Graw Hill

55 Alavi, M., & Leidner, D. E. (2001). Review: Knowledge management and knowledgemanagement systems: Conceptual foundations and research issues. MIS Quarterly, 25(1), 107-136. Abbott, J., Stone, M., & Buttle, F. (2001). Customer relationship management in practice - a qualitative study. Journal of Database Marketing, 9(1), 24-34. Bose, R. (2002). Customer relationship management: Key components for IT success. Industrial Management & Data Systems, 102(1-2), 89-97. Bose, R., & Sugumaran, V. (2003). Application of knowledge management technology in customer relationship management. Knowledge and Process Management, 10(1), 3-17. Baker,M (2000) Marketing Strategy and Management(3rd edn.), London, Macmillan Business. BELSON, A. (1986), Validity in Survey Research, Gower Publishing Company. Berry, L.L. (1983), Relationship Marketing, in L.L. Berry, G.L. Shostack and G.Opah (eds) Emerging Perspectives on Services Marketing, pp 25-28 Buttle, F. (2004), Customer Relationship Management: Concepts and Tools, Elsevier Butterworth-Heinemann, Oxford Brown, C. V., & Vessey, I. (2003). Managing the next wave of enterprise systems:Leveraging lessons from ERP. MIS Quarterly Executive, 2(1), 65-77. BRUCE, I. (2004), Questionnaire Design: How to Plan, Structure and Write Survey Material for Effective Market Research, Kogan Page. Berry, L. L. (1995). Relationship marketing of services - Growing interest, emerging perspectives. Journal of the Academy of Marketing Science, 23(4), 236245.

CRM article,2009[online] available at [ accessed on 21st may 2010]

Chaudhuri, A & Shainesh (2001), Implementing a Technology Based CRM Solution. CRM Emerging Concepts, McGraw Hill CLARKE J., and CRICHTER, (1985), The Devil makes Work: Leisure in Capitalist Britain, University of Illinois Press. Customer relationship management, 2009[online] available at =en&r.s=sc&r.l1=1073861197& 1075422922&r.i=1075422931&r.t=RESOURCES [Accessed 28th March 2010] Customer relationship management, 2009[online] available at type=RESOURCES&itemId=1075422939 [Accessed 28th March 2010] CRM architecture, 2010 [online] available at [accessed 26th April 2010] Croteau, A.-M., & Li, P. (2003). Critical success factors of CRM technological initiatives. Canadian Journal of Administrative Sciences, 20(1), 21-34. COHAN, L., and MANION, L. (1994), Research Methods in Education, Routledge. Davis, R. (2002). The Wizard of Oz in CRMland: CRM's need for business process management. Information Systems Management, 19(4), 43-48. DeLone, W. H., & McLean, E. R. (1992). Information systems success: The quest for the dependent variable. Information Systems Journal, 3(1), 6095.
Department of energy and climate change, 2009 [online] available at [Accessed 20th April 2010]


Edmunds,H (1999) The Focus Group Research Handbook, Illinios, NTC Business Books

EWB, (2007), Questionnaire Validity, (online), Evensen Web Design. Retrieved May 8, 2010, from: Fournier, S., Dobscha, S., & Mick, D. G. (1998). Preventing the premature death of relationship marketing. Harvard Business Review, 76(1), 42-49.

Green G., Kennedy P. and McGown A. (2002) Management of multimethod engineering design research: a case study Journal of Engineering and Technology Management 19, 131 140 Gounaris, S. P. (2005). Trust and commitment influences on customer retention:Insights from business-to-business services. Journal of Business Research, 58(2), 126-140. Garbarino, E., & Johnson, M. S. (1999). The different roles of satisfaction, trust, and commitment in customer relationships. Journal of Marketing, 63(2), 70-87. Ganesan, S. (1994). Determinants of long-term orientation in buyerseller relationships.Journal of Marketing, 58(2), 1-19. Gruen, T. W. (1997), Relationship Marketing: The Route to Marketing Efficiency and Effectiveness: Atlanta. Gummesson, E. (2002). Relationship marketing and a new economy: It's time for deprogramming.Journal of Services Marketing, 16(7), 585-589. Hirschowitz, A. (2001). Closing the CRM loop: The 21st century marketer's challenge:Transforming customer insight into customer value. Journal of Targeting,Measurement and Analysis for Marketing, 10(2), 168-178.

58 Helfert, G., Ritter, T., & Walter, A. (2002). Redefining market orientation from a relationship perspective: Theoretical considerations and empirical results. European Journal of Marketing, 36(9/10), 1119-1139. Hausman, A. (2001). Variations in relationship strength and its impact on performance and satisfaction in business relationships. The Journal of Business & Industrial Marketing, 16(6/7), 600-616.

Hart,G.,et al (2002), An Examination of Primary stakeholders opinions in CRM: Convergence and Divergence? Journal of Customer Behaviour, 1, pp. 215-240. Kamakura, W. A., Mela, C. F., Ansari, A., Bodapati, A., Fader, P., Iyengar, R., (2005). Choice models and customer relationship management. Marketing Letters,vol 16 part 3:pp. 279-291. Kotler, P. (2003). Marketing management (11th ed.). Upper Saddle River, NJ: Pearson Education. Kapoulas, A., Ellis, N., & Murphy, W. (2004). The voice of the customer in e-banking relationships. Journal of Customer Behaviour, 3(1), 27-51. Kamakura, W. A., Mela, C. F., Ansari, A., Bodapati, A., Fader, P., Iyengar, R., et al.(2005). Choice models and customer relationship management. Marketing Letters, 16(3-4), 279-291. Karimi, J., Somers, T. M., & Gupta, Y. P. (2001). Impact of information technologymanagement practices on customer service. Journal of Management Information Systems, 17(4), 125-158. Kotler P. (2003) Marketing Management, New Jersey: Prentice-Hall Inc. Lewin J. E. and Johnston W. J. (1997) Relationship Marketing Theory in Practice: A Case Study Journal of Business Research 39, 23 31 Lemon, A., et al. (2002), Dynamic Customer Relationship Management: Incorporating Future Considerateions into the service Retention Decision Journal of Marketing, 66 (January), pp. 1-14.

59 Ling, R., & Yen, D. C. (2001). Customer relationship management: An analysis framework and implementation strategies. The Journal of Computer Information Systems, 41(3), 82-97.

Lewin, J. E., & Johnston, W. J. (1997). Relationship marketing theory in practice: A case study. Journal of Business Research, 39(1), 23-31.

Morgan, R. M., & Hunt, S. D. (1994). The commitment-trust theory of relationship marketing. Journal of Marketing, 58(3), 20-38. MCDANIEL, C. AND GATES, R. (2006), Marketing Research Essentials. 5th edition, Wiley. MCNABB, D. (2004), Research Methods for Political Science: Quantitative and Qualitative Methods, M.E. Sharpe. MALHOTRA, N. AND PETERSON, M. (2006), Basic Marketing Research, 2ndedition, Prentice Hall London. Our value,2009[online] available at id=400&TierSlicer1_TSMenuTargetID=400&TierSlicer1_TSMenuTargetType=1&TierSlicer 1_TSMenuID=6 [Accessed on 20may 2010]
Our businesses,2009[online] available at http://www.scottish- id=400&TierSlicer1_TSMenuTargetID=400&TierSlicer1_TSMenuTargetType=1&TierSlic er1_TSMenuID=6 [accessed 20th April 2010] PARKER, C and WORTHINGTON, S. (2000), International Journal of Retail & Distribution Management, 28 (11), pg. 490497. Pels, J., Coviello, N. E., & Brodie, R. J. (2000). Integrating transactional and relational marketing exchange: A pluralistic perspective. Journal of Marketing Theory and Practice, 8(3), 11-20. PUNCH, K. (2003), Survey Research: The Basics, SAGE Publications Ltd London.

60 Peters, L. D., & Fletcher, K. P. (2004b). They love me, they love me not: Consumer relationship orientation and CRM. Journal of Customer Behaviour, 3(1), 53-80. Qualitative versus quantitative research: key points in a classic debate, (online), Research Methods For Studying PsychoSocial Change Programs. Retrieved May 8, 2010, from: tml Raman, P., & Pashupati, K. (2004). Is CRM really doomed to fail? An exploratory study of the barriers to CRM implementation. Journal of Customer Behaviour, 3(1), 5-26. Reinartz, W. J., Krafft, M., & Hoyer, W. D. (2004). The customer relationship management process: Its measurement and impact on performance. Journal of Marketing Research, 41(3), 293-305. Richard, J. E., Thirkell, P. C., & Huff, S. L. (2007). An examination of customerrelationship management (CRM) technology adoption and its impact on business-to-business customer relationships. Total Quality Management & Business Excellence, 18(8), 927-945. Rigby, D. K., & Ledingham, D. (2004). CRM done right. Harvard Business Review,82(11), 118-133.

Raghunath, S., Shields, J. (2001), "Introduction of e-CRM in Indian Hotel Industry, CRM Emerging concepts, McGraw Hill Ryals, L., & Knox, S. (2001). Cross-functional issues in the implementation of relationship marketing through customer relationship management. European Management Journal, 19(5), 534-542. Stefanou, C. J., Sarmaniotis, C., & Stafyla, A. (2003). CRM and customercentric knowledge management: An empirical research. Business Process Management Journal, 9(5), 617-634.

Schneider B. and Bowen D.E. (1999), Understanding Consumer Delight and Outrage, Slogan Management Review, vol. 41, pp. 35-45.
semi structured interviews available at [online] [accessed on 12th may 2010]


Shoemaker, M. E. (2001). A framework for examining IT-enabled market relationships. Journal of Personal Selling & Sales Management, 21(2), 177-185. Sheth, J. N. (2002). The future of relationship marketing. Journal of Services Marketing, 16(7), 590-592. Sharp B. and Sharp A (1997) Loyalty programs and their impact on repeat-purchase loyalty patterns International Journal of Research in Marketing14, 473 486 Simon J. and Vosseberg G. (2001), Research Methods An MSc Study Guide, Hull: University of Hull Business School. SAUNDERS, M., LEWIS, P., and THORNHILL, A. (2003), Research Methods for Business Students, 3rd Edition, Financial Times Prentice Hill. Turban, E., Rainer, R. K., Jr., & Potter, R. E. (2003). Introduction to information technology (2nd ed.). New York: John Wiley & Sons. VEAL, A. (1997), Research Methods for Leisure and Tourism, Pearson Education Limited. Winer, R. S. (2001). A framework for customer relationship management. California Management Review, 43(4), 89-105. Zikmund W. G. (2000) Business Research Methods (6th edn) Forth Worth: Harcourt College Publishers


Please indicate the extent to which you agree or disagree with the following statements 1=Strongly Agree 2=Agree 3=Neutral 4=Disagree 5=Strongly Agree

1 When the CRM project was launched initially it was really difficult to adopt because of all the complexities. But finally it has been possible to get used to it because of support and commitment from the management.
Figure 4.1
1 20 40% 2 10 20% 3 5 10% 4 10 20% 5 5 10% Total 50 100%

Average score for this statement is 2.4

63 2 The employees were finding difficult the way system used to work but after the implementation of CRM, the employees are much happy with dealing with the problems.
Figure 4.2
1 16 32% 2 12 24% 3 8 16% 4 9 18% 5 5 10% Total 50 100%

Average score for this statement is 2.5 3 The CRM system has been designed to improve and boost sales from current customers and has been important tool to retain customers switching to competitors.
Figure 4.3
1 12 24% 2 11 22% 3 7 14% 4 14 28% 5 6 12% Total 50 100%

Average score for this statement is 2.82 4 The system was really complex and difficult to adopt and therefore one was not looking forward to the get on with it.
Figure 4.4
1 5 10% 2 6 12% 3 9 18% 4 20 40% 5 10 20% Total 50 100%

Average score for this statement is 3.48 5 Organizational factors that supported CRM-led changes, which eventually changed the entire organizational culture.
Figure 4.5
1 10 20% 2 8 16% 3 9 18% 4 10 20% 5 13 26% Total 50 100%

Average score for this statement is 3.16 6 The culture in this company insists too much competition with other companies and therefore I believe that was main reason for the usage of CRM.
Figure 4.6
1 15 30% 2 12 24% 3 6 12% 4 10 20% 5 7 14% Total 50 100%

64 Average score for this statement is 2.64 7 Our manager was very supportive throughout the CRM related activity; I felt I am learning something new for better.
Figure 4.7
1 10 20% 2 15 30% 3 10 20% 4 8 16% 5 7 14% Total 50 100%

Average score for this statement is 2.74 8 In this time everything is revolved around the customer, and thats how we are asked to organize our tasks and strategy, here CRM gives vital help.
Figure 4.8
1 15 30% 2 10 20% 3 6 12% 4 12 24% 5 7 14% Total 50 100%

Average score for this statement is 2.72 9 I dont like to be trained so often; specially with the new system I am not familiar with.
Figure 4.9
1 11 22% 2 10 20% 3 5 10% 4 15 30% 5 9 18% Total 50 100%

Average score for this statement is 3.02 10 CRM is vital for all employees and that is the only way we can cope up with rising competition and it enables us to deal with customers demand in correct way.
Figure 4.10
1 20 40% 2 10 20% 3 7 14% 4 8 16% 5 5 10% Total 50 100%

Average score for this statement is 2.36 11 The companys CRM software is great and user friendly therefore I can work much faster and effectively.
Figure 4.11
1 2 3 4 5 Total

20 40% 17 20% 4 10% 4 20% 5 10% 50 100%

Average score for this statement is 2.14 12 With the help of CRM, work load has reduced and it help the employees to sell Companys other products to the customers. This is much better than previous years where it was required to ask more questions just to get idea about suitability for the other products to the customer.
Figure 4.12
1 18 36% 2 14 28% 3 8 16% 4 5 10% 5 5 10% Total 50 100%

Average score for this statement is 2.30 13 With the help of CRM significant growth has been established.
Figure 4.13
1 13 26% 2 16 32% 3 7 14% 4 7 14% 5 7 14% Total 50 100%

Average score for this statement is 2.58 14 CRM has played vital part in improving all activity from marketing to retaining the customers.
Figure 4.14
1 9 18% 2 21 42% 3 5 10% 4 6 12% 5 8 16% Total 50 100%

Average score for this statement is 2.60 15 With the effective use of CRM, the company has gained the second rank in 2010 from previous rank of fourth in 2005 in the utility market.

Figure 4.15
1 15 30% 2 9 18% 3 6 12% 4 6 12% 5 14 28% Total 50 100%

Average score for this statement is 2.90


16 CRM has reduced overall cost of the company and has improved ROI. (Returns on investment)
Figure 4.16
1 10 20% 2 6 12% 3 6 12% 4 14 28% 5 14 28% Total 50 100%

Average score for this statement is 3.32 17 Severe competitions amongst energy companies and modernization have compelled the company to use CRM.
Figure 4.17
1 18 36% 2 10 20% 3 8 16% 4 9 18% 5 5 10% Total 50 100%

Average score for this statement is 2.46 18 CRM has made employees job less complex and faster.
Figure 4.18
1 15 30% 2 18 38% 3 9 18% 4 5 10% 5 3 6% Total 50 100%

Average score for this statement is 2.26 19 CRM has increased the creditability of customer contact centre and has helped to gain number one position for customer service in the energy market.
Figure 4.19
1 10 20% 2 20 40% 3 9 18% 4 7 14% 5 4 8% Total 50 100%

Average score for this statement is 2.10 20 CRM has provided more opportunity to compete against competitors therefore there is no waste of time and quality of work is rated frequently?

Figure 4.20
1 12 24% 2 14 28% 3 9 18% 4 11 22% 5 4 8% Total 50 100%

67 Average score for this statement is 2.62