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Customer Relationship Management Etihad - Case Study Example

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The paper 'Customer Relationship Management Etihad' is a perfect example of a Management Case Study. Customer relationship management is a vast executed management strategy of the firm and its customers or consumers of its products. It, therefore, engrosses the use of technical know-how to systematize, computerized, and harmonize the firm’s business operations especially sales…
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Customer Relationship Management Etihad Name: Institution: Date Due: Table of content Introduction 2 Etihad Airways 4 Reasons for Customer relationship 4 Customer service 5 Value creation and data handling 6 Technology 8 Employees and process 10 Potential outcomes 12 Reference 14 Introduction Customer relationship management is vast executed management strategy of the firm and its customers or consumers of its products. It therefore engrosses the use of technical know-how to systematize, computerize and harmonize the firm’s business operations especially sales, customer service, and technical assistant and marketing activities in this case Etihad. The main objective of CRM is to lure, and win the client’s preference hence increase the firms revenue returns. Moreover, it provides retention and nurturing technique for its already existing clients. This is done through alluring former clientele back into the business and cutting down the expenditure of marketing and client services. CRM therefore, describes a firm’s business strategy that is with the inclusion of customer interface and other related responsibilities. The quantitative measurement the value of customer affiliation is fundamental to the execution of this strategy (Pennington, 2007). Customer relationship management is a relevant strategy to be implemented by a firm such as Etihad. Firms that need consumers in order to maximize their profits have a system that efficiently and successfully manages the clientele affiliations. CRM is a business philosophy which enhances the firm to have an apparition of the way a firm is able to deal with its customers. Thus in order to deliver this vision the firm needs a CRM strategy which affects the shape of sales, marketing, and customer services and data analysis activities. Most firms embrace CRM to increase its profit margin by increasing the value and relationship of its customers and vendor. Software solutions and the advancing technology have facilitated the innovative ways of working with CRM. Moreover, it propagates the completion of CRM cycle that is plan, interact, process, leverage and planning a new (Hunt, 2011). Etihad Airways Etihad Airways is the rationale airline spatially located in the United Arab Emirates and has so far established base within the last 7 years as the world’s leading airline. It was setup by the Royal decree in 2003 in the month of July. Etihad initialized its commercial services in November 2003 and is ranked the fastest growing in the history of the commercial aviation industry. The hub of the airlines is Abu Dhabi which is also the capital of United Arab Emirates. The firm has 57 commercial aircrafts and operates close to 1000 flights in 7 days, serving international destination covering about 44 countries and networked to 66 destinations. The mission of the airlines is to create the best image of Arabian hospitality, culture, considerate and generosity. Moreover it tends to enhance the prestige of Abu Dhabi as the core of generosity flanked by the East and West. The airlines has so far received a range of awards that creates its image as the premium airline brand in the globe for instance the ‘world leading Airline’ during the world’s travel awards during the 2009 2010 period (khan, June 2010). Reasons for Customer relationship Organizations that are involved in the sales of both online and off-shelf products and services have to embrace CRM for the success of the business that is maximizing the firm’s revenue. This is exemplified in Etihad which uses CRM strategies as depicted in its triumph in the business world. On the other hand Etihad is also has an online business through the selling of airline tickets and other related products. Therefore, firms that have a mission of achieving profits and rake hold of significant customers need to educate themselves about the phenomenon, Customer Relationship Management. Customer Relationship Management is thus concerned with luring and economically keeping important customers; enhance healthy firm-customer relationships and eradicating less profitable variables. Through these firms are able to realize call centre services which deals with one customer at a time hence cost effectiveness. Apart from that it enables the firm too forecast the future and thereby strategize plans. CRM will continue being a development tool for the business world. In the economically enlightened world the purchasing over the internet and airline trip for business ventures is increasing. Moreover, online businesses are picking pace very rapidly. This is due to convenience which is ranked the number one element for purchasing online and offline according to surveys (Joachim, March 11, 2002). Customer service An effective CRM system lets the firm (Etihad) communicate with its customers using a single communication tool that is one-voice-firm. This is because of the organizational staff in Etihad have adequate history about the customer. Information that is captured in the CRM system helps the firm (Etihad) to recognize the actual expenditure of winning and retaining consumer’s. Having adequate data concerning customer allows the firm to focus its time and resources on its most profitable clientele and their changes in behavior. The classification of the firm’s best customers in this way allows the firm to manage them more effectively as a premium assembly with the comprehension that it is neither vital nor worthwhile to treat every consumer in the exact similar way thus adopting to customer preferences. The firm should in this event execute in pursuit of consumer loyalty and ensure changes in their preferences is detected (Waltner, January 29, 2001). Customer satisfaction and retention: Sources: Etihad annual report (2010) Value creation and data handling The positioning of Etihad products is based upon customer’s perceptions through information gathered. Therefore airline marketers (ETIHAD) little control over the positioning of their products this is because of the nature of the services the firm offers. Services provided by the firm are less complex but made up of complex mix of intangibles. The airline products are not physical but are performance and experiences which differs from one firm to another, that is comparison of Etihad and other similar firms. Thus employees ensure that the firm offers the best customer experiences to ensure they are retained with the services provided. Every interaction of the customer and the airline employees highly influences customer perceptions of the airlines and its rank in one’s mind. Etihad business is vibrant and more so dynamic since it plays a major role in the development of the commercial industry. Thus it obtains its data from various sources such as customer database, click stream data and business systems. Moreover apart from that it obtains its data from market, sales, and customer automation. Therefore when a customer purchases any product form the firm it’s recorded into their system hence simulating the customer’s desires over time. Apart from that the salesmen assess the frequency of products purchases at a customer level which depicts their preference. CRM uses internal sources to gather its data (Wells, 1994). When a customer deals with the firm information is recorded through feedback mechanism. Customers are entitled to feel or use of electronic gadgets by pressing the required level of satisfaction. Therefore, the firm is able to gather required information concerning customer expectation and plotting of customer-product curve to determine the firm’s future sales. The filled forms are relevant as the firm requires them for data up datedness. Data is handled very carefully as it contains the firm’s pulse for its survival in the airline industry. Therefore most of the information gathered is archived safely in the firm’s information storage hub (Wells, 1994). Technology One tool that Etihad uses and has already implemented in the pursuit of customer loyalty is in this way ‘personalization’. The software ‘personalization’ generates a real-time profile for each consumer using information from various sources for instance customer database, click stream data and business systems. Therefore, the tool offers the firm the best customer’s selection when the customer shops or books flight within the firm’s website. When the clientele declines or accepts the offer the tool ‘personalization’ software structures this knowledge of the consumer into his/her profile. This will make the customer better informed about his/her later, future offers and the firm transition concerning the offers. ‘Personalization’ software has so far proved its effectiveness. It is hence considered the best navigational aide within the firm’s site which offers a wide range of products, services and content. The tool is time saving and the embracement of the technology is considered a great move by the firm (Greenberg, 2001). Commencing doing business using CRM software tools and hardware will need the firm to have disruptive organizational change. This was done to have it determined which department are frequently in contact with the customers and which are just adding to overhead. Trimming the redundant head count is hence inevitable as the hardware part requires fewer personnel for effectiveness. Therefore the firm should consider all stakeholders before the implementation of the technology into the system. The hardware part should also ensure by management that it is comprehended by the employees and customers. Thus the executive should stress on the use of technological tools. By adopting the new processes the firm needed to change departmental roles and responsibilities. Thus the firm took step-wise approach oriented towards improving the efficiency of the organization. Employing the step wise approach the firm’s departments are treated as separate entities. This approach rarely produces good outcomes as goals of various departments are parochial and they tend to compete against each other internally for what is best for the firm hence integrated approach should be considered (Janice, 2001– Seventh Annual Conference on Information Systems). The focus of the firm should consider its industry, position within the industrial world and which hardware and software implementation requirement should be considered. The criteria should be: scalability of the software; flexibility for the customization; the stability of the existing software and hardware application; hardware and software upgradeable support; security; and the availability of additional modules of both the software and hardware. The emphasis of the new technology and the existing should be analyzed critically to determine which trend best suits the firm. Therefore without the integration of the two the firm is liable to redundancy risk of data and the eventual loss of customers due to delays and botched transactions. With such integration the Etihad is able to improve its business intelligence for the capture of data at every instance the customer transacts with the firm (White, January 2000). White, (2000) asserts that security is a firm’s core concern for both the firm and its clients and is becoming a very significant aspect of customer service. There are various types of security however; with technology in mind two are mainly considered. Company perspective; recent surveys show that internet fraud is increasing rampantly. However, this incidence has so far been cut down by the adoption of authenticated and fraud-detection e-business software and hardware technology which in turn promotes CRM. Recent survey show that the firm could save about $10 billion over the next four financial years. It is hence clear that is the firm’s best interest to shield itself from such infringements. Therefore the organization has so far made a step further by setting up flags in the security software that could be tripped when transaction exceed a predefined dollar amount. Moreover, customer focused security is encouraged. This deals in steps the firm takes to inspire trust form its potential customers either online or off-shelf. Use of authentication, non-repudiation and automated clearing house or 128-bit data encryption ensures that customer fraud is greatly reduced. Employees and process Etihad employs close to 8,000 employees representing over 120 nationalities. The airline is targeting in pioneering opportunities for the UAE’s population with its employees. Moreover it has launched its loyalty program which has been endorsed by about 1 million members. The program facilitates the firm to encroach guest miles which can thereafter be redeemed against the wide range of 1,800 flight and non-flight selection rewards. It therefore aims at providing its customers with best travel experience in ground and ground. Through the upgrading of its aircrafts and recruitment of new staff the firm has been able to gain an admirable perception (Janice, 2001– Seventh Annual Conference on Information Systems). The firm sells its products through either online sales or off-shelf sales where customers are able to d their purchases. Through enhanced services such as mobile phone delivery and booking via the net is embraced. Moreover, the value of customers is highly maintained to encourage more sales. In the long-run the firm is able to maximize its revenues and feedbacks through websites that have so been launched for enquiries and comments. Source: Etihad annual report (2010) The extended sales process is used by Etihad in order to reach more clientele and deal with their problems at an individual level. It thus have a series of harmonized sales processes defines various organizational selling motions. Hence the principle players are defined in each phase with the inclusion of CRM the workflow is enhanced. Etihad prefer that their employees to earn a certification of customer relationship management in an Arabian manner. This type of sensitization will enable the labor force to have a harmonized interaction between employees and its clientele in a positive way that promotes future communication and the after sales and services within the airlines. Customer relationship management teaches the tools that are needed to connect with the customers in an approach that instills customer trust and confidence for instance how clients are approached by the airline employees. The structuring of a common foundation with the customers is an effective method to commence building the consumer airline products. Surveys show that people are drawn to what they are lured to. Therefore when customers are approached by a confident and well communicated salesperson they are more likely to listen and be convinced in choosing Etihad (Joachim, March 11, 2002). Potential outcomes CRM has so far become the latest paradigm in the world business with the technological advancement of ECRM. This is depicted by the need for Etihad to go online to fully harness its full potential gold mines. Electronic-CRM is becoming more and more popular in this event firms are no longer relying on brick and mortar strategies that have so far gotten them where they are today. Organization such as Etihad has so far evolved with the market needs rather than behind it. In the first quarter of the 21st century Etihad has received an array of awards ranging from both local and international awards. This reflects the image of the firm as the leading premium airline in the world. Thus careful adoption of CRM and its technological advances relays its significance (Sims, April 2000). Etihad so far has achieved through engulfing more customers and retaining the already existing ones through its committed travel experience both in-flight and on the ground. It is a representation of modern Arabia CRM strategies eating a humble pie form best five star boutique hospitality from around the globe. This is because its clients travel in state-of-the-art designs and customer treatment to ensure maximum comfort and repetition of the same. In this event it has quite an impeccable CRM services. Sim, (2000) further suggest that recent studies relay that about 10% gains of Etihad come from repeat customers and add up to 10% of the firm’s profits. On the other hand 10% decrease needed for luring more customers. In essence keeping the already existing customers elated is more profitable than venturing for new ones. Therefore it is significant to keep the existing customers while gaining more knowledge on their preferences hence CRM. Etihad can gain as much as $130 million in profits through improving its customer relationships. Sim, (2000) asserts that about 64% of the firm’s returns on sales is attributed to CRM and affiliated technology performance. This is depicted through a well implemented CRM strategy which provides a winning situation for customers and the firm alike. The enhancement of customer experience leads to greater consumer satisfaction which in turn impacts positively on Etihad’s profitability. Therefore an efficient implementation of CRM will lead into greater reduction on a firm’s expenditure while earning greater returns hence maximized profits. Reference Greenberg, P. (2001). Capturing and Keeping Customers in Internet Real Time. N J: McGraw-Hill. Hunt, J. (2011). Importance of Customer Relationship Management. Corporate Matters Resources , 1-5. Janice, H. R. (2001– Seventh Annual Conference on Information Systems). Strategic Planning for E-Commerce Systems – Towards an E-Customer Focus. SPECS , 1-14. Joachim, D. (March 11, 2002). CRM tools improve access, usability (cover story). B to B 87 no. 3 , 1. khan, h. (June 2010). Fact Sheet Complete, Etihad Airways. Scribd , 1-7. Pennington, L. L. (2007). Surviving the Design and Implementation of a Content-Management System. Journal of Business & Technical Communication 21 , no. 1:62-73. Sims, D. (April 2000). A New ROI for New Economy CRM And Just Why Doesn’t High-Tech Get It? crmguru.com , 4-6. Waltner, C. (January 29, 2001). CRM makes on-line Shopping Personal. InformationWeek . Wells, T. (1994). A management perspective. Air Transportation 3rd ed. California. White, R. (January 2000). Building a sustainable e-business CRM Strategy. Call Center Solutions , 1-4 Read More
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