Customer Relationship Management ( CRM )

                                               Customer Relationship Management ( CRM )

Every business unit emphasizes on spurting a long term relationship with customers to nurture its stability in today’s blooming market. Customer’s expectations are now not only limited to get best products and services, they also need a face-to-face business in which they want to receive exactly what they demand and in a quick time.

Customer Relationship Management is an upright concept or strategy to solidify relations with customers and at the same time reducing cost and enhancing productivity and profitability in business.

An ideal CRM system is a centralized collection all data sources under an organization and provides an atomistic real time vision of customer information. A CRM system is vast and significant, but it be can implemented for small business, as well as large enterprises also as the main goal is to assist the customers efficiently.

Usually an organization consists of various departments which predominantly have access to customer’s information either directly or indirectly. A CRM system piles up this information centrally, examines it and then makes it addressable within all the departments. Lets take an example of an international call center which uses a CRM tool called ‘xyz’ and is integrated with a phone and a computer system or laptop. Now this system automatically perceives which customer is calling. Before the executive attends the phone the CRM system brings forth the customer details on the computer or laptop screen and also indicates what the opportunity of deals is with that particular customer, what the customer had already purchased or ordered in past and what is the probability of buying in future. Not only this, it can also highlight what all products best suit this customer. For finance department it may show the information regarding the current balance and for accounting department it may pop out the information regarding the recent purchases by the customer. All these pieces of data are stored in the CRM database and are available as and when it is needed.

According to this example, CRM system provides a well defined platform for all business units to interact with their clients and fulfill all their needs and demands very effectively and to build long-term relationship.

Wangling this kind of relationship with customers is not easy to manage and it depends on how the systematically and flexibly a CRM system is implemented or integrated. But once it’s accomplished it serves the best way in dealing with customers. In turn customers feels gratitude of self-satisfaction and loyalty which results in better bonding with supplier and hence increasing the business.

A CRM system is not only used to deal with the existing customers but is also useful in acquiring new customers. The process first starts with identifying a customer and maintaining all the corresponding details into the CRM system which is also called an ‘Opportunity of Business’. The Sales and Field representatives then try getting business out of these customers by sophistically following up with them and converting them into a winning deal.

Customer Relationship Management strategies have given a new outlook to all the suppliers and customers to keep the business going under an estimable relationship by fulfilling mutual needs of buying and selling.

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Designing and Managing Value Networks and Marketing Channels

A normal way of functioning for a company is to procure raw materials, use its expertise in creating the product and then distribute to the customer. Companies have to convert this supply chain into a value network as to develop and maintain partnership with different stakeholders. Value Network and Marketing Channel A network which creates partnership and value in purchase, production and selling of products is referred to as value network. Value network looks at the whole supply chain system players as partners rather than customers. The purpose of value network is to increase productivity, save cost and increase revenue. Companies are willing to take the procurement process on online for accuracy and speed. Companies exactly know each partner’s role in influencing or disrupting normal operations. Companies have developed distribution channel and network through which it supplies final product to customers.

This distribution channel and network are referred to as the marketing channel. Companies invest time and money in a well functioning marketing channel. The marketing channels are an integral part of marketing and promotional activity of the company.

Marketing Channels

Core competency for a company lies in developing a product which satisfies a particular need of the market. A company if it decides to sell a product on its own than it is diverting from main line business resulting in operational difficulties. Marketing channel is ears and eyes of companies in the market. They provide companies with valuable information of customers, competitors and other players in the market. Dell’s computer exclusively uses direct marketing (the Internet and express mail service) in reaching customers. are different of marketing channel depending upon the number intermediaries like retailer, wholesaler and distributor. Channels are also used by companies providing services; for example, hospital and fire station have to strategically locate for people to reach without considerable efforts.

Marketing Channel Design, Management, Evaluation and Modification

In designing marketing channel companies analyze customer needs and preference for a given product. Further marketing channel should fall in line with overall objectives of the company in cost and desired output level. Companies then need to explore various marketing channels like direct marketing, tele-marketing, direct mail, etc. to find the right fit to reach the customer. Each channel short listed has is to be evaluated on operational, cost effective and flexibility criteria. Once the channel is designed, companies look forward to selecting partners with characteristics, which have a positive impact for the product. Channel members need to get the right amount of training as to full understand their role with respect to customer and product. Companies need to develop a mechanism as to monitor functioning of marketing channels on criteria based on total customer satisfaction. After reviewing marketing channel companies should modify them to improve functioning and productivity.

New Trends in Marketing Channels

Companies are looking forward to innovating business functioning as to stand up to the competition and changing market scenario. This has seen rise different types of marketing channel. In a vertical marketing channel, the traditional producer-wholesaler-retailer becomes one functional unit. This can be achieved through franchise or single ownership. In horizontal marketing channel two or more un-related agencies combine to exploit the market opportunities, for example, banks in super markets. In multi-channel marketing systems, companies use different marketing channels to reach different customer base or segment.

Conflict Management in Marketing Channels

In vertical channel conflicts are between members of same channel. In horizontal channel conflicts are between similar service providers in a different channel. In multi-channel conflict arise when a different channel serves the same market. The first step in conflict resolution is to identify the cause for the conflict. Next step is to manage the conflict. This can be done by setting up clear mandate for each member and their role in the overall objective of the company. Further, joint membership, diplomacy and exchange of team members are other ways in resolving conflicts.

Companies need to design and manage marketing channels in such a way that they are always able to deliver value to customer.

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WHO BECOME A LEADER

                                                LEADERSHIP SKILLS AND QUALITIES 

 

Who become a Leader

At the most basic level, a leader is someone who leads other. But what makes someone a leader? What is it about being a leader that some people understand and use to their advantage? What can you do to be a leader? Here's what you need to know and do.

A leader is a person who has a vision, a drive and a commitment to achieve that vision, and the skills to make it happen. Let's look at each of those in detail.

 

The Leader's Vision

A leader has a vision. Leaders see a problem that needs to be fixed or a goal that needs to be achieved. It may be something that no one else sees or simply something that no one else wants to tackle. Whatever it is, it is the focus of the leaders attention and they attack it with a single-minded determination. 

Whether the goal is to double the company's annual sales, develop a product that will solve a certain problem, or start a company that can achieve the leader's dream, the leader always has a clear target in mind. This is a big picture sort of thing, not the process improvement that reduces errors by 2% but the new manufacturing process that completely eliminates the step that caused the errors. It is the new product that makes people say "why didn't I think of that", not just a toaster that lets you select the degree of darkness of the toast. Edison did not set out to build a better candle, he wanted to find a whole new way to illuminate the darkness. That's the kind of vision a leader has.

 

The Drive To See It Through

It is not enough to just have a vision. Lots of people see things that should be done, things that should be fixed, great step forward that could be taken. What makes leaders different is that they act. They take the steps to achieve their vision.

Is it a passion for the idea, an inner sense of drive, or some sense of commitment? Whatever it is, it is the strength that lets leaders move their vision forward despite all the obstacles, despite all the people saying it can't be done, it's too costly, we tried that before, or a dozen other excuses. The true leader perseveres and moves forward.

 

Trait And Skills A Leader Must Have

There are things that set leaders apart from other people. Some people are born with these characteristics. Others develop them as they improve as leaders. These are not magic bullets. They are things you can do and be if you want to be a leader.

 

Traits Of A Leader

There are as many traits of a leader as there ae lists of what makes a leader. Here are the fundamental traits of a leader from my perspective:

• Has integrity. People have to believe that you are pursuing your dream because it's the right thing to do, not just because you are ego driven.
• Is a people person. Understands the differences that make people unique and is able to use those individual skills to achieve the goal.
• Is positive. A leader encourages and rewards people and makes you want to do it and do it right. A leader is not a negative person and doesn't waste time and effort tellng everyone what they're doing wrong.

 

Leadership Skills

Beyond the personal traits of a leader, there are specific skills someone must master if they want to be a leader.

• Effective communication - it's more than just being able to speak and write. A leader's communication must move people to work toward the goal the leader has chosen.
• Motivation - a leader has to be able to motivate everyone to contribute. Each of us has different "buttons". A leader knows how to push the right buttons on everyone to make them really want to do their best to achieve the leader's goal.
• Planning - the leader has a plan to achieve the goal. He/she doesn't get too bogged down in the details, that are what managers are for, but rather uses a high level plan to keep everyone moving together toward the goal.

 

Bottom Line

Leaders dream dreams. They refuse to let anyone or anything get in the way of achieving those dreams. They are realistic, but unrelenting. They are polite, but insistent. The constantly and consistently drive forward toward their goal. You can be a leader. You will be - when it matters enough to you.

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Managing Retailing, Wholesaling and Market Logistics

                                  

                                         Managing Retailing, Wholesaling and Market Logistics

Companies are looking forward to moving away from the conventional supply chain and moving towards value network. In a value network traditional supplier-wholesaler-retailer are considered as partners rather than as a customer. Companies designing marketing channel under the value network principle need to understand the players, role and their importance.

Retailing

The act through which goods and services reach the end customer for individual or business usage is known as retailing. The players involved in this act are known as retailers. Retailers can be manufactures, distributors or wholesalers. They can reach the end customer through the internet or physical stores. Retail organizations are divided into three categories store retailers, non-store retailers and retail organization. Store retailing, the best example is the department store like Macy or Sears. Store retailers are further divided on the service level with self service, self selection, limited service and full service stores. Store retailing comprises over 90% in way products reach the end customer.

Over the years non-store retailing has garnered a market share. Non-store retailing includes direct selling, direct marketing, automatic vending and buying service. Avon is an example of direct selling. Internet retail giant Amzon.com is an example of direct marketing. Soft drink vending machines are a form of automatic vending.

Retail organizations are retailing stores under direct ownership of corporate. Customer satisfaction and brand management becomes easier through retail organizations. Corporate chain store like Old Navy and Franchises like McDonald’s are good examples of retail organizations.

Every retailer needs to have a business or marketing strategy for success. Retailer needs to analyze its target market and customers for an in-store promotion and product assortment. Services form a big part of retailing business, so retailers have to finalize level of service. Services include pre-purchase, post purchase and supporting services.

With the advent of technology and unprecedented economic growth, retailing has its own share of change in business ways.

Wholesaling

The act of purchasing goods for consumer and industry for further resale is referred to as wholesaling. Here, manufactures and farmers are not considered as wholesalers.

Wholesaler is an important part of the marketing channel. Wholesaler increase reach of the company products and the risk of selling to the customers. Wholesaler can store inventory of various assortment of product thus helping cost for company and time for customers. Wholesaler can serve as ears and eyes for the company in understanding competition and customer.

Marketing Logistics

The supply chain management is essential for companies to improve productivity and reduce costs. The purpose of marketing logistic is to design and implement infrastructure, which will deliver goods from the point of origin to point of sell in an effective and least cost manner. This objective mix of high customer satisfaction and lowest cost possible are asymmetrical. The major decision involved with marketing logistic relate to order processing, warehousing, inventory and transportation.

Companies look forward to shortening order to payment cycle. A long cycle will lead to decrease in customer satisfaction and company’s profit. Companies have to set benchmarks at each level from sales people receiving orders to receiving payment from creditors.

Warehousing for finished goods is another important hub for companies. There has to be a right balance between sales order and quantity of finished goods. Warehousing at strategic locations increases timely delivery of goods and reducing in inventory. Technology has helped in improving warehousing standards.

Piled up inventory is not a good sign for the company. Inventory management involves making decision with time and quantity of raw materials for matching customer requirements. Management principle like Just In Time (JIT) are used for better inventory management. In JIT focus is to develop well time flow of raw materials and finished goods.

Transportation and freight cost plays an important role in final pricing, delivery and condition of raw materials as well as finished products. Here companies need to make the decision, whether to use a private carrier (company ownership), contractual (Outside agency) or common carrier (service shared at standard rates).

Retailing, wholesaling and logistic decision are very important to deliver value to end customers.

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VENDOR MANAGED INVENTORY & INVENTORY COST

VENDOR MANAGED INVENTORY:

As the name suggests, VMI stands for Vendor Managed Inventory. VMI involves a collaborative and continuous inventory supply owned, managed and replenished by the Manufacturer right up to the last stocking point or point of sale to end customer.
VMI concept is widely being used by companies both as procurement business model and FG supply chain model too. Industries like retail supermarkets, consumable supplier industry, electronic hardware industry and Automotive Components industries have adopted these strategies effectively to improve their supply chain efficiencies.
VMI concept aims to reduce inventory in the pipeline, besides achieving the concept of JIT - Just in time where in the ownership of the inventory lies with the supplier until the time of usage or sale where it gets transferred to the buyer. This model also reduces operational costs of logistics and inventory management for the buyer.

INVENTORY COST :



Inventory procurement, storage and management is associated with huge costs associated with each these functions.
Inventory costs are basically categorized into three headings:

1. Ordering Cost
2. Carrying Cost
3. Shortage or stock out Cost & Cost of Replenishment
   
   
   1. Cost of Loss, pilferage, shrinkage and obsolescence etc.
   2. Cost of Logistics
   3. Sales Discounts, Volume discounts and other related costs.

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Inventories Types

   Types of Inventories - Independent and Dependant Demand Inventories

Posted: 06 Sep 2010 11:16 AM PDT

Inventory Management deals essentially with balancing the inventory levels. Inventory is categorized into two types based on the demand pattern, which creates the need for inventory. The two types of demand are Independent Demand and Dependant Demand for inventories.

Independent Demand

An inventory of an item is said to be falling into the category of independent demand when the demand for such an item is not dependant upon the demand for another item. Finished goods Items, which are ordered by External Customers or manufactured for stock and sale, are called independent demand items. Independent demands for inventories are based on confirmed Customer orders, forecasts, estimates and past historical data.

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Dr. Abdul Kalam's Letter to Every Indian

Why is the media here so negative?

Why are we in India so embarrassed to recognize our own strengths, our achievements?We are such a great nation. We have so many amazing success stories but we refuse to acknowledge them. Why?We are the first in milk production.We are number one in Remote sensing satellites.We are the second largest producer of wheat.We are the second largest producer of rice.Look at Dr. Sudarshan; he has transferred the tribal village into a self-sustaining, self-driving unit. There are millions of such achievements but our media is only obsessed in the bad news and failures and disasters.I was in Tel Aviv once and I was reading the Israeli newspaper. It was the day after a lot of attacks and bombardments and deaths had taken place. The Hamas had struck. But the front page of the newspaper had the picture of a Jewish gentleman who in five years had transformed his desert into an orchid and a granary. It was this inspiring picture that everyone woke up to. The gory details of killings, bombardments, deaths, were inside in the newspaper, buried among other news. 

    In India we only read about death, sickness, terrorism, crime.. Why are we so NEGATIVE? Another question: Why are we, as a nation so obsessed with foreign things? We want foreign T.Vs, we want foreign shirts. We want foreign technology.Why this obsession with everything imported. Do we not realize that self-respect comes with self-reliance? I was in Hyderabad giving this lecture, when a 14 year old girl asked me for my autograph. I asked her what her goal in life is. She replied: I want to live in a developed India. For her, you and I will have to build this developed India. You must proclaim. India is not an under-developed nation; it is a highly developed nation.

     Do you have 10 minutes? Allow me to come back with a vengeance. Got 10 minutes for your country? If yes, then read; otherwise, choice is yours.. 

   YOU say that our government is inefficient.YOU say that our laws are too old.YOU say that the municipality does not pick up the garbage.YOU say that the phones don't work, the railways are a joke. The airline is the worst in the world, mails never reach their destination. YOU say that our country has been fed to the dogs and is the absolute pits.YOU say, say and say. What do YOU do about it? Take a person on his way to Singapore. Give him a name - 'YOURS'. Give him a face - 'YOURS'. YOU walk out of the airport and you are at your International best. In Singapore you don't throw cigarette butts on the roads or eat in the stores. YOU are as proud of their Underground links as they are. You pay $5 (approx. Rs. 60) to drive through Orchard Road (equivalent of Mahim Causeway or Pedder Road) between 5 PM and 8 PM. YOU come back to the parking lot to punch your parking ticket if you have over stayed in a restaurant or a shopping mall irrespective of your status identity… In Singapore you don't say anything, DO YOU? YOU wouldn't dare to eat in public during Ramadan, in Dubai. YOU would not dare to go out without your head covered in Jeddah. YOU would not dare to buy an employee of the telephone exchange in London at 10 pounds (Rs.650) a month to, 'see to it that my STD and ISD calls are billed to someone else.’ YOU would not dare to speed beyond 55 mph (88 km/h) in Washington and then tell the traffic cop, 'Jaanta hai main kaun hoon (Do you know who I am?). I am so and so's son. Take your two bucks and get lost.' YOU wouldn't chuck an empty coconut shell anywhere other than the garbage pail on the beaches in Australia and New Zealand.Why don't YOU spit Paan on the streets of Tokyo? Why don't YOU use examination jockeys or buy fake certificates in Boston??? We are still talking of the same YOU. YOU who can respect and conform to a foreign system in other countries but cannot in your own. You who will throw papers and cigarettes on the road the moment you touch Indian ground. If you can be an involved and appreciative citizen in an alien country, why cannot you be the same here in India?

     In America every dog owner has to clean up after his pet has done the job. Same in Japan .. Will the Indian citizen do that here?' He's right. We go to the polls to choose a government and after that forfeit all responsibility.We sit back wanting to be pampered and expect the government to do everything for us whilst our contribution is totally negative. We expect the government to clean up but we are not going to stop chucking garbage all over the place nor are we going to stop to pick a up a stray piece of paper and throw it in the bin. We expect the railways to provide clean bathrooms but we are not going to learn the proper use of bathrooms.We want Indian Airlines and Air India to provide the best of food and toiletries but we are not going to stop pilfering at the least opportunity.This applies even to the staff, who is known not to pass on the service to the public.

       When it comes to burning social issues like those related to women, dowry, and girl child! And others, we make loud drawing room protestations and continue to do the reverse at home. Our excuse? 'It's the whole system which has to change, how will it matter if I alone forego my sons' rights to a dowry.' So who's going to change the system? What does a system consist of? Very conveniently for us it consists of our neighbors, other households, other cities, other communities and the government. But definitely not me and YOU. When it comes to us actually making a positive contribution to the system we lock ourselves along with our families into a safe cocoon and look into the distance at countries far away and wait for a Mr. Clean to come along & work miracles for us with a majestic sweep of his hand or we leave the country and run away.Like lazy cowards hounded by our fears we run to America to bask in their glory and praise their system. When New York becomes insecure we run to England. When England experiences unemployment, we take the next flight out to the Gulf. When the Gulf is war struck, we demand to be rescued and brought home by the Indian government. Everybody is out to abuse and rape the country. Nobody thinks of feeding the system. Our conscience is mortgaged to money. Dear Indians, The article is highly thought inductive, calls for a great deal of introspection and pricks one's conscience too…. I am echoing J. F. Kennedy's words to his fellow Americans to relate to Indians….. 'ASK WHAT WE CAN DO FOR INDIA AND DO WHAT HAS TO BE DONE TO MAKE INDIA WHAT AMERICA AND OTHER WESTERN COUNTRIES ARE TODAY' Let’s do what India needs from us.

Thank you,

Dr. Abdul Kalam (Former President of India)

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