Customer Relationship Management Case Study


Customer relationship management is a broadly executed strategy that enhances the relationship between a company and its clients (Bidgoli 2010). Customer relationship management entails the use of technology to systematize, automate and harmonize business processes.Customer relationship management is primarily about managing sales activities but also may include technical support, marketing and customer services. The main objectives of customer relationship management are to sustain the current customers and attract new ones (Bidgoli, 2010).

Why IBM had a poor relationship with its customers

There are a number of reasons IBM had a poor relationship with its customers. One of the reasons is that the company had an elaborate culture of bureaucracy which was rigid. This might have made it difficult for relevant company employees to effectively deal with customer related issues.Besides, lack of proper communication was also one of the reasons that contributed to the poor relationship between the IBM and its customers. For instance, there was poor communication between product development department and marketing department. This implies that the marketing department could not effectively offer the customers sufficient information on the company’s products, especially with respect to product malfunctions.If the marketing department could not offer proper information to customers due to lack of communication between it and the production department, then customers were bound to have negative perception on the company’s operations. They were therefore likely to look for other alternatives.The poor communication, especially between the research arid business divisions, made it almost impossible to solve customers’ problems arising from the functionality of the company’s products. Besides, IBM could not have had the opportunity to enhance the relationship between it and the customers. This was because of its overall size, organizational structure and departments which were not well coordinated.From the customer’s perspective, IBM did not provide an integrated and harmonized interface for dealing with their issues. According to customers, the company did not have a clear mechanism of dealing with their issues.Instead, the company dealt with customers through numerous and different channels spread over a wide geographical region. This definitely caused a significant amount of confusion to the customers. The customers therefore had a general feeling that they were not dealing with IBM as a unit. All these led to low customer satisfaction and hence lost revenues.

The eCRM solution and provider that IBM contracted with

IBM contracted with Siebel Systems, which was a leading Customer Relationship Management vendor. The eCRM solution adopted by the IBM entailed integrated Tele-web channel which encompassed websites and call centers. The eCRM utilized special software that ensured the employees had all the crucial information about the company’s customers and the products.The solution has numerous advantages to the company and its customers. One of the advantages of using the solution is that the employees and staff members had a broad assortment of crucial information on customers and the company products at their finger tips.Through the solution, the staff members were able to track information on customers’ purchase of company products. Hence, the staff members were able to evaluate and comprehend the needs of the company’s customers. This had the potential of increasing the profit margin for IBM Company.With the new eCRM solutions, IBM was able to manage the information on its customers, business partners and product vendors. The solution made the operations of the company to be more effective than before. The new solution also reduced the cost of IBM’s business operations.In the process of implementing the new CRM platform, IBM had also implemented Partner World Lead Management platform. This was grounded on the Siebel Partner Relationship Management. The impact of this was that the IBM Company managed to build up on the ties it had with its partners and hence enhanced the dissemination of its sales leads to the business partners.The use of the solution also witnessed the improvement of productivity, especially after the inclusion of the company’s field personnel. The cost of operating call centers also reduced tremendously without necessarily employing extra personnel to man the call centers.It was important for the company to allow system users be part of the deployment process. Importantly, this made the end users to feel they were part of the entire project. It was also important for the end users to be involved in the entire process so that they could gain familiarity and understanding of the system they would be utilizing in future as they engaged with IBM Company. Moreover, involving end users was a sure way of gaining their support and confidence for the entire project.

How IBM prepared its employees across the world to use the new big solution

In order to prepare employees across the world to use the new solution, IBM embarked on training its employees on the usage of the newly introduced system of eCRM. The training was conducted by company’s Application Management Services; this was within the IBM’s Learning Development Division.The useful materials to be used in the training process were produced and distributed in collaboration with the Siebel End User education team. The training of the company’s employees was facilitated through the use of both classroom sessions and e-learning.It was important for IBM to train its employees across the world to use the new big solution because that was crucial in making them understand the usage of the new CRM system. The adoption of the solution was important to the company in terms of cost reduction; but it could not be successful if the employees could not understand how to use or implement it.

The type of CRM adopted by IBM

IBM adopted an operational CRM. This was because it aimed to enhance effective interface with its customers. The use of the new solution of CRM was primarily meant to reduce the company’s cost of operations, especially with respect to customer relationship management.The CRM solution also aimed to ensure a consistent and reliable interface across all the company’s channels of communication. To achieve this, the IBM’s new CRM solution allowed for the collection of customers’ information and availing at all the company’s client touch points. Employees’ contact with customers was enhanced by the eCRM.

Outcomes IBM gained by using eCRM

IBM gained a lot by adopting eCRM. First, the company was able to enhance the relationship it had with its clients. The use of eCRM enabled IBM to have a synchronized way of handling the company’s customers across the world. The customer services were standardized; this followed the intense and effective training that the employees of the company worldwide were taken through. Besides, the company was also able to reduce the cost of operations after the implementation of the eCRM solution.


Initially, IBM Company had a problem with its customer relations because of certain internal factors such as lack of communication and bureaucracy. This was costly to the company in terms of revenues and lost opportunities. However, after implementing the solution of eCRM, the company managed to enhance the way it dealt with its customers and business partners. It also started registering increased profit margins besides reduced cost of operations.

References List

Bidgoli, H 2010, The Handbook of Technology Management: Supply Chain Management, Marketing and Advertising, and Global Management, John Wiley and Sons, Hampshire.

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