The Royal Mint London 2012 Olympic Souvenir Coins - Essay Example

The Royal Mint London Olympic souvenir coins Table of contents Executive Summary 3 Introduction 3 2. Relationship Management in Royal Mint 4 2.1 Elements of a Customer Relationship Management (CRM) system, which the Royal Mint could use to understand how well they could manage their customers 4 2.2 Benefits that the Royal Mint will gain from the introduction of a Customer Relationship Management (CRM) system 7 2.3 Ethical and legal issues involved for The Royal Mint in using the customer information they store for future marketing activity 8 3. Conclusion 9 4. Recommendations 9 References 10 Appendix 11 Executive Summary The criteria on which key organizational strategies are based are not standardized. Usually, the aims and the objectives of each organization are set as the basis for its plans and practices; however, the market conditions can often affect the priorities of the organizations, either in the short or the long term. Focusing on its core needs can help an organization to secure its position in the global market. The CRM is a strategy that supports the improvement of the relations between the organization and its customers, leading, gradually, to the increase of organizational profits. The specific strategy is developed through an appropriately customized CRM system, the elements of which are customized for each organization, in accordance with the organizational needs and characteristics but also with the resources available. In Royal Mint, ‘a leading export mint, exporting to about 60 countries worldwide’ (Royal Mint, About the Royal Mint, 2011), the introduction of such system is considered as necessary since the firm’s existing practices for managing its customers can be characterized as rather problematic. 1. Introduction The development of business activities worldwide is usually related to the ability of firms to establish innovative practices, which will allow them to increase their competitiveness towards their rivals. The introduction of Customer Relationship Management (CRM) systems is considered as part of the firms’ efforts to secure their position in the global market. The above systems aim to promote the Customer Relationship Management, a strategy, which has been described as ‘a customer-focused business strategy designed to optimize profitability, revenue and customer satisfaction’ (Gartner Group 2002, in Vogt 2009, p.3). The key aim of CRM is reflected in the following definition: ‘CRM means becoming a customer-focused organization’ (Garret 2000, in Vogt 2009, p.4). From a different point of view, CRM has been characterized as a ‘state of mind’ within the organization in which three functional areas are incorporated: sales, marketing and customer service’ (Merkel 2010, p.4). Moreover, Kincaid (2003) notes that CRM should be considered as the awareness of customer’s needs, meaning that each organization should be aware of the needs of its customers in regards to the products/ services available by the specific organization. In other words, CRM can significantly help towards the strengthening of the relations between the organization and its customers. This issue is highlighted in this paper. The potentials of a particular organization, the Royal Mint, to improve its communication with its customers through a CRM system is examined and evaluated. It is concluded that CRM could help the organization to develop its communication with its customers but specific changes in the firm’s existing strategy would be required. 2. Customer Relationship Management in Royal Mint 2.1 Elements of a Customer Relationship Management (CRM) system, which the Royal Mint could use to understand how well they could manage their customers The introduction of a Customer Relationship Management (CRM) system in Royal Mint, could help the firm’s managers to understand the quality of the organization’s customer services. In general, this system could improve the relations between the firm and its customers but such target could be achieve under the following term: the CRM system chosen should have specific elements, in terms of its structure but also of its potentials as part of the organization’s key strategic tools. The potential elements of this system could be identified using the literature published in the specific field. Two different forms of CRM, as a business strategy, are presented in Appendix (Figure 1 & Figure 2). It is clear that the parts of CRM are not standardized; their core objective should be the improvement of the relations between the organization and its customers but different plans would be developed for achieving this target. In accordance with Grunewalder (2008) the promotion of CRM within a particular organization is based on an appropriately customized CRM system; this system aims to make the communication between the customer and the organization more effective, a fact that can lead to the increase of the organization’s profits. It is also noted that a CRM system can achieve its objectives when it is carefully planned, meaning that its phases are clearly presented (Grunewalder 2008). On the other hand, Segovia, Szczepaniak and Niedzwiedzinsky (2002) note that a key element of a CRM system is ‘an analytical sub-system for the analysis of customer-related data’ (Segovia, Szczepaniak and Niedzwiedzinsky 2002, p.79). Through this sub-system, the data of each customer could be processed in real time, i.e. during the relevant transaction (Segovia, Szczepaniak and Niedzwiedzinsky 2002). In any case, the elements of a CRM system are depended on the needs of the organization involved but also the resources available. The CRM systems developed by software providers are based on the above fact. For example, the CRM system of Oracle emphasizes on marketing and sales (Wisner, Tan, and Leong 2008). In Microsoft, the organization’s CRM system, the Microsoft Dynamics CRM Application, incorporates a high range of features allowing ‘to the users the direct access to customers’ information’ (Wisner, Tan and Leong 2008, p.367). In the study of Meersman (2009) reference is made to the potential use of the ‘service platform approach’ (Meersman 2009, p.489) when building a CRM system. In the context of such approach, a successful CRM system should focus on the promotion of marketing and sales, being able to monitor the progress of orders up as of all their stages, i.e. up to their completion (Meersman 2009, p.489). In the case of Royal Mint, the CRM system chosen should focus on the following issues: a) the improvement of communication with customers; the availability of customers’ information in real time, i.e. during the transaction, would be valuable so that the firm’s employees are able to handle effectively all orders, b) the increase of effectiveness of the firm’s marketing plans; the firm’s marketing practices should be more customer-focused, meaning that the customer information stored in the system could be used for producing a marketing plan addressing each customer separately. This target could be achieved, for example, through a newsletter, which would address the different needs of the organization’s customers, c) the decrease of time required for the completion of each order, d) the development of the firm’s current range of products, following the suggestions of customers; for example, the customers’ comments on each order received could be stored and used for improving existing products or for introducing new, aiming to increase the firm’s profitability, e) the increase of security regarding the customers’ personal details; existing system used for storing the customers’ data is not quite effective, especially as of the safety provided to the customers’ personal data. The new CRM system would incorporate features for ensuring the safety of customers’ personal data without preventing the use of the data for critical organizational tasks, for example, the development of marketing strategies in regard to the firm’s specific products. The issues highlighted in the literature regarding the necessary elements of an effective CRM system, as these issues were analyzed above, should be also taken into consideration by managers in Royal Mint when having to decide on the structure of the CRM system that will be introduced in the organization for addressing specific organizational needs. 2.2 Benefits that the Royal Mint will gain from the introduction of a Customer Relationship Management (CRM) system In case that a CRM system is successfully implemented, then it can result to a long term competitive advantage for the organization involved (Grunewalder 2008, p.5). In any case, through such system, the organization can ‘hear its customers’ voice’ (Grunewalder 2008, p.5). In this way, the organization’s impact on its customers is increased, leading to the increase of customer loyalty. This means that the organization is able to secure its existing customer base but also to attract new customers (Grunewalder 2008, p.5). On the other hand, the introduction of a CRM system would lead to the increase of effectiveness of a firm’s sales and marketing strategies. More specifically, by storing data related to past purchases of customers, employees in a specific organization ‘can make customized selling to the customer’ (Meersman 2009, p.488). This means that the organization could also develop forecasts based on the information stored in the system, as the relevant data show the profile of customers but also their preferences (Davis 2009, p.309). At the same time, a CRM system can help towards the increase of simplicity of information provided to the organization’s accountants; indeed, since the information related to each customer will be integrated, the accountants of the organization could develop more accurate reports and statements; the time required for the development of critical tasks regarding the firm’s financial reports would be also decreased (Meersman 2009, p.489). In addition to the above, a CRM can help ‘to check the availability of products’ (Kurtz 2010, p.322). In this way, employees receiving orders would be able to inform the customers on the time required for the completion of their order. At the same time, through the CRM system, the amount of orders related to each customer can be measured with accuracy; customers who have exceed a specific level of orders can be rewarded, a strategy that could enhance customer loyalty (Kurtz 2010, p.322). The benefits described above could also result for Royal Mint, in case that the CRM system would be introduced in the specific organization. 2.3 Ethical and legal issues involved for The Royal Mint in using the customer information they store for future marketing activity As explained above, the storage of customer information is considered as one of the advantages of CRM systems, since the information of this type can be used for developing effective marketing plans. However, such initiatives could raise a series of ethical and legal concerns. In accordance with Peelen (2005) the employees involved in the management of CRM systems should be appropriately skilled and trained so that all rules related to the use of the above systems are applied. On the other hand, it may be necessary for different levels of access to be set for each organizational department. In this way, the access to the customer information would be controlled and failures in the management of the relevant data would be minimized (Ward and Daniel 2006). Moreover, barriers need to exist in regard to the customer information used for marketing purposes. Personal data provided by the customer during a transaction cannot be used for marketing purposes unless there is a clear authorization for such use (Fitzgerald and Arnott 2000). In case that the firm’s marketers fail to meet the requirements of the law in regard to the management of personal details of customers, then allegations for fraud could be developed (Pride and Ferrell 2010). It should be noted that in the context of modern technology, which promotes the use of intranets and extranets within organizations, the management of personal data can be related to many risks, meaning the loss of data but also the availability of data to third, non-authorized, persons (Kotler and Armstrong 2010, p.153). 3. Conclusion The success of CRM system in Royal Mint would be depended on a series of factors. The specific system could significantly help towards the improvement of performance of Royal Mint but only under the terms that ethical and legal issues related to the use of the data stored in the system are addressed. Employees in Royal Mint do not have experience on the use of such systems, a fact that increases the risk of the particular project. However, if specific measures are taken, as those, indicatively, suggested below, the risks related to the introduction of the specific system would be minimized. The managers of the organization should decide on the elements of the system based on the existing literature but also on the plans used by other firms operating in the same industry. The CRM system chosen should be able to meet the targets set by its initiators and to pay back the investment made within a relatively short period of time. 4. Recommendations The introduction of a CRM system in Royal Mint could significantly help towards the improvement of relations between the organization and its customers. However, it would be necessary for specific problems to be addressed. The firm’s existing IT systems may not be available to support such system; this means that an update of the firm’s IT system would be possibly required in order for the CRM system to operate effectively. On the other hand, employees in Royal Mint should be appropriately trained in order to respond to the new system’s needs. In any case, the CRM system should be closely monitored, as of its performance but also as of its daily needs, in order to avoid any major failure in the firm’s performance. At the same time, the following suggestion should be made: before deciding on the structure and features of the CRM system, managers in Royal Mint should review the performance of CRM systems used by rivals. Also, before introducing the CRM system, managers in Royal Mint should develop a cost/ benefit – analysis report, aiming to check whether the organization can afford the particular investment and to estimate the actual value of the system as a strategic tool for increasing organizational performance. References Davis, J. 2009. Competitive Success, How Branding Adds Value. Hoboken: John Wiley and Sons. Fitzgerald, M., Arnott, D. 2000. Marketing communications classics: an international collection of classic and contemporary papers. Belmont: Cengage Learning. Grunewalder, A. 2008. Implementing CRM Systems: Approaches and Potential Problems. Norderstedt: GRIN Verlag, 2008 Kincaid, J. 2003. Customer relationship management: getting it right! New Jersey: Prentice Hall Professional. Kotler, P., Armstrong, G. 2010. Principles of marketing. Essex: Pearson Education. Kurtz, D. 2010. Contemporary Marketing. Belmont: Cengage Learning. Meersman, R. 2009. On the Move to Meaningful Internet Systems: OTM 2009 Workshops: Confederated International Workshops and Posters, ADI, CAMS, EI2N, ISDE, IWSSA, MONET, OnToContent, ODIS, ORM, OTM Academy, SWWS, SEMELS, Beyond SAWSDL, and Combek 2009, Vilamoura, Portugal, November 1-6, 2009, Proceedings. New York: Springer. Merkel, N. 2010. Customer Relationship Management in Banking Sector. Norderstedt: GRIN Verlag. Peelen, E. 2005. Customer relationship management. Essex: Pearson Education. Pride, W., Ferrell, O. 2010. Foundations of Marketing. Belmont: Cengage Learning. Segovia, J., Szczepaniak, P., Niedzwiedzinsky, M. 2002. E-commerce and intelligent methods. New York: Springer. Vogt, H. 2009. Open Source Customer Relationship Management Solutions. Hamburg: Diplomica Verlag. Ward, J., Daniel, E. 2006. Benefits management: delivering value from IS & IT investments. Hoboken: John Wiley and Sons. Wisner, J., Tan, K., Leong, K. 2008. Principles of Supply Chain Management: A Balanced Approach. Belmont: Cengage Learning, 2008 Appendix Figure 1 – Customer Relationship Management (Source: http://www.marketingmo.com/2-create-tools-and-processes/how-to-select-crm-for-your-business/) Figure 2 - Customer Relationship Management (Source: http://www.clearvision.com.sa/index.php?module=solutions&page=details&id=19) Read More