Indian Institute of Management Bangalore

Customer Relationship Management

Faculty: Prof. G. Shainesh
Room C-103, Tel : 3334
Term IV

PGP (2014-15)

3 Credit Course

Background Businesses aim to win and keep customers. Its competitors also seek to
do the same. Most successful firms have developed capabilities for attracting customers
through their marketing programs. But they have shown mixed results when it comes to
retaining these customers. Customer Relationship Management helps businesses in
successfully implementing strategies aimed at winning and retaining customers profitably.
It is also helping businesses shift from a short-term transaction based mode of operation in
their interactions with customers to a long-term relationship mode.
Objectives The objective of this course is to help students understand the concept and
practice of CRM derived from research and applications across businesses. These
concepts and applications from real life case studies will help identify opportunities, which
can be successfully implemented for long term profitability.
Pedagogy The teaching methodology will include a mix of lectures, discussions,
presentations by practitioners, videos, exercises and case analysis. The cases are
integrative in nature but will also help develop an appreciation of specific elements of CRM.
Each session will require preparation of assigned reading / case and active participation by
students. A significant portion of the performance will depend on students contribution to
the class.
Group Project
Identify any organisation which is practicing some form of CRM. Start working with them to
understand the objectives, strategy, structure and process of relationship management.
Identify the key issues they faced in implementation especially related to financial and
marketing evaluation of the program. Interview some relationship customers of this
organisation to understand the customer perspective.
Evaluation
Case Analysis & Presentations
Class Participation
Group project
Exam (Mid Term)

- 20%
- 20%
- 30%
- 30%

All submissions are due before the beginning of the assigned class (specified on Moodle).
Attendance Students should attend a minimum of 75% classes and contribute to case
analysis and discussions. Students with attendance below 75% will lose 1 GPA.

Textbook - G. Shainesh and Jagdish N Sheth (2006),Customer Relationship

Management A Strategic Perspective Macmillan: New Delhi.
Customer Relationship Management
Course Outline - PGP (2013-14)
Coverage
The course is divided into four modules Module 1 - CRM Concepts,
Module 2 - CRM Applications in Consumer and Business Markets,
Module 3 - CRM Tools, Techniques and Technologies, and
Module 4 - CRM Implementation

Module 1: Sessions 1-5

The Concept of Customer Relationship Management
Text: Chapters 1-4
This module focuses on the conceptual and theoretical foundations of CRM. A number of
theoretical perspectives developed in economics, law and social psychology are being
applied in CRM. These include transactions cost analysis, agency theory, relational
contracting, social exchange theory, network theory, game theory and interorganizational
exchange behavior. Resource allocation and resource dependency perspectives and
classical psychological and consumer behavior theories have also been used to explain
why organizations and consumers engage in relational behavior. An overview of these
theories will help develop insights on CRM from multiple perspectives.
Other topics include
Evolution of customer relationships
Benefits of CRM
Transaction vs. Relationship orientation
Relationship building as a process
The ladder of loyalty
Bonding for customer relationship
Zero Customer Defections
Market share vs. share of customer
Lifetime value of customers
Session 1 : CRM : The Strategic Imperatives
Reading Chapter 1
Session 2: Conceptual Foundations of CRM
Reading Chapter 2
Case Analysis Angels and Devils: Best Buys New Customer Approach
Session 3: Building Customer Relationships
Reading Chapter 3

Case Analysis Tchibo Ideas: Leveraging the Creativity of Customers

Session 4: Economics of CRM
Reading Chapter 4
Case Analysis - Rosewood Hotels & Resorts: Branding to Increase Customer
Profitability and Lifetime Value
Session 5:
Case Analysis EMC2: Delivering Customer Centricity

Additional Recommended Readings

Brodie, R. J., Hollebeek, L. D., Juri, B., & Ili, A. (2011). Customer Engagement:
Conceptual Domain, Fundamental Propositions, and Implications for Research. Journal
of Service Research, 14(3), 252-271.
Egol, M., Hyde, P., Ribeiro, F. and Tipping, A. (2004) The Customer-Centric
Organization: From Pushing Products to Winning Customers
http://www.booz.com/media/file/The_Customer_Centric_Organization.pdf
Roland Rust, Valarie A. Zeithaml ,and Katherine N. Lemon (2004), Customer-Centered
Brand Management, Harvard Business Review, September, pp. 110-118.
Parvatiyar, A and Sheth, J.N. (2001), Conceptual Framework of Customer
Relationship in Customer Relationship Management Emerging Concepts, Tools and
Applications, Sheth, J.N., Parvatiyar, A. and Shainesh, G., Eds., New Delhi: Tata
McGraw Hill, pp. 3-25.
Prahalad, C. K., & Ramaswamy, V. (2000). Co-Opting Customer Competence. Harvard
Business Review, 78(1), 79-90.
Fournier, S, Dobscha, S, and Mick, D. G. 'Preventing the Premature Death of
Relationship Marketing', Harvard Business Review, January - February 1998, pp. 42-51.
Module 2: Sessions 6-10
CRM Application in Consumer and Business Markets
Text: Chapters 5-6
This module focuses on applications and practices of CRM in different business
contexts. CRM has been applied in consumer and business markets covering goods as
well as the services sector. Rewards / loyalty programs are the most visible aspect of of
CRM in consumer markets while CRM manifests itself as Key Account Management
(KAM) in business markets. Marketers in the services businesses have been pioneers
in adopting CRM. Review of the concepts and practices of service quality, service
recovery and service guarantees will be done in this module. CRM practices in telecom,
hospitality, retail and airlines and in the durables and automobile markets will be
highlighted through select cases. In addition to KAM, the concept and practice of
Customer value management (CVM) will be covered.
Session 6 -7 : CRM in B2C Markets
Reading Chapter 5

Case Analysis : Cyworld: Creating and Capturing Value in a Social Network

Session 8 : CRM in B2B Markets
Reading Chapter 6
Session 9 :
Case Analysis P&G : Improving Consumer Value Through Process Design
Session 10:
Case Analysis ABB and Caterpillar: Key Account Management
Additional Recommended Readings
Tarasi, C. O., Bolton, R. N., Gustafsson, A., & Walker, B. A. (2013). Relationship Characteristics
and Cash Flow Variability: Implications for Satisfaction, Loyalty, and Customer Portfolio
Management. Journal of Service Research, 16(2), 121-137.
Shainesh, G. (2012), Effects of Trustworthiness and Trust on Loyalty Intentions: Validating a
Parsimonious Model in Banking, International Journal of Bank Marketing, Vol. 30, Iss: 4, 267
279.
Nitzan, I., & Libai, B. (2011). Social Effects on Customer Retention. Journal of Marketing, 75(6),
24-38.
Lemon, K. N., & Wangenheim, F. V. (2009). The reinforcing effects of loyalty program
partnerships and core service usage a longitudinal analysis. Journal of Service Research, 11(4),
357-370.
Senn, C. (2006). The Executive Growth Factor: How Siemens Invigorated Its Customer
Relationships. Journal of Business Strategy, 27(1), 27-34.
Anderson, J. C., Narus, J. A., & Van Rossum, W. (2006). Customer Value Propositions in
Business Markets. Harvard Business Review, 84(3), 90.
Narayandas, D. (2005). Building loyalty in business markets. Harvard Business Review, 83(9),
131-139.
Lam, S. Y., Shankar, V., Erramilli, M. K., & Murthy, B. (2004). Customer Value, Satisfaction,
Loyalty, and Switching Costs: An Illustration from a Business-To-Business Service Context.
Journal of the Academy of Marketing Science, 32(3), 293-311.
Reinartz and V. Kumar (2003), The Mismanagement of Customer Loyalty, Harvard Business
Review, 80 (July) 86-94.
Uncles, Mark D., Grahame R. Dowling, and Kathy Hammond (2003), Customer Loyalty and
Customer Loyalty Programs, Journal of Consumer Marketing, 20 (4/5), 294-316.
Homburg, C., Workman Jr, J. P., & Jensen, O. (2002). A Configurational Perspective on Key
Account Management. Journal of Marketing, 66(2), 38-60.

Module 3: Sessions 11-15

CRM Tools, Techniques and Technologies
Text: Chapters 7-9
Information and communication technologies have played a key role in the rapid
adoption of CRM by businesses. These technologies, many of them developed in the
last decade, have helped in automating the customer facing functions of sales,
marketing and service. An overview of the components of eCRM Solutions help
understand the technologies which enable an organization to get a single unified view of
its customers across various points of contact. A balanced approach of CRM combines
4

both operational and the analytical technologies. Data warehouseing and data mining
form the support base for both operational as well as analytical CRM. The role of
datawarehousing and datamining tools and applications are highlighted to help
appreciate the analytical aspects of CRM. Coverage includes the three main
components of comprehensive CRM solutions include Campaign Management, Sales
Force Automation, and Customer Service and Support.
The functionalities and applications of a few popular CRM products targeted at large
enterprises (Siebel, SAPCRM) and a few targeted at the small and medium enterprises
(SalesLogix, Microsoft CRM) will be covered. An overview of the emerging hosted CRM
products (Salesforce.com) and social CRM will also be covered.
Finally the role of contact centers in building customer relationship is highlighted.
Topics include
Sales Force Automation
Customer Service and Support
Marketing (Campaign Management)
Datawarehouse & datamining
Evaluating technological solutions for CRM
Role of a contact center in building relationships
Components of a contact center
Economics of a contact center
Session 11-12: Components of eCRM Solutions
Reading Chapter 7
Case Analysis Pilgrim Bank: Customer Profitability
Session 13 : Product Offerings in the CRM Market Space
Reading Chapter 8
Session 14: Contact Centers for CRM
Reading Chapter 9
Session 15:

Case Analysis Hilton Hotels: Brand Differentiation through CRM

Additional Recommended Readings
Baird, C. H., & Parasnis, G. (2011). From Social Media to Social Customer Relationship
Management. Strategy & Leadership, 39(5), 30-37.
Hopkins, M.S. and Brokaw, L. (2011) Matchmaking With Math: How Analytics Beats Intuition to
Win Customers, MIT Sloan Management Review, 52(2), 35-41.
Bijmolt, T. H., Leeflang, P. S., Block, F., Eisenbeiss, M., Hardie, B. G., Lemmens, A., & Saffert,
P. (2010). Analytics For Customer Engagement. Journal of Service Research, 13(3), 341-356.

Zeithaml, Valarie A., Roland T. Rust, and Katherine N. Lemon (2001), The Customer Pyramid:
Creating and Serving Profitable Customers, California Management Review, 44 (Summer),
118-142.
Shoemaker, Mary E. (2002), A Framework for Examining IT Enabled Market Relationships,
Journal of Personal Selling and Sales Management, 21 (Spring), 177-185.
Reinartz, Werner J. and V. Kumar (2000), On the Profitability of Long-Life Customers in a
Noncontractual Setting: An Empirical Investigation and Implications for Marketing, Journal of
Marketing, 64 (October), 17-35.
Rust, Roland T., Valarie A. Zeithaml, and Katherine N. Lemon (2004), Customer-Centered
Brand Management, Harvard Business Review, 81 (September), 110-118

Module 4: Sessions 16-20

CRM Implementation
Text: Chapters 10-11
The last module will focus on issues related to CRM implementation. The organizational
challenges of implementing CRM is underscored by the high levels of failures in
implementing technology intensive CRM solutions. This module adopts a process
oriented view of CRM implementation.
Topics include
The CRM Roadmap
Defining a CRM strategy
Developing a relationship orientation
Internal marketing
Budgeting for Attraction vs. Retention
Learning from Customer Defections
Evaluating Retention Programs
Session 16-17: The CRM Roadmap
Reading Chapter 10
Case Analysis Cineplex Entertainment: The Loyalty Program

Session 18: Operational issues in implementing CRM

Reading Chapter 11
Case Analysis Customer Profitability and CRM at RBC Financial Group
Session 19: Group Project Presentations
Session 20:
Case Analysis Implementing a Technology Based CRM Solution - The ICICI
Experience (pp. 184-192 of text book)

Additional Recommended Readings

Hoffman, D. L., & Fodor, M. (2010). Can you measure the ROI of your social media
marketing. MIT Sloan Management Review, 52(1), 41-49.
Ryals, L. (2005). Making customer relationship management work: the measurement
and profitable management of customer relationships. Journal of Marketing, 252-261.
Reinartz, W., Krafft, M., & Hoyer, W. D. (2004). The Customer Relationship Management
Process: Its Measurement and Impact on Performance. Journal of Marketing Research, 293305.
Rust, Roland T., Katherine N. Lemon, and Valarie A. Zeithaml (2004), Return on Marketing:
Using Customer Equity to Focus Marketing Strategy, Journal of Marketing, 68 (January), 109127.
Timothy L. Keiningham, Bruce Cooil, Tor Wallin Andreassen, & Lerzan Aksoy (2007), A
Longitudinal Examination of Net Promoter and Firm Revenue Growth, Journal of Marketing,
Vol. 71, July, , 3951
Thomas, Jacquelyn S., Werner Reinartz, and V. Kumar (2004), Getting the Most out of All Your
Customers, Harvard Business Review, 81 (July-August), 116-123.