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Question:



Fabulous Furniture is a large manufacturing company with an ERP system that sells a variety of furniture to many customers. Its customers often purchase separate pieces of furniture over several visits. The company is having difficulty in recalling which customers have purchased which styles of furniture on their previous visits.


What systems might Fabulous Furniture consider to resolve this issue? Explain how your recommendation will overcome the company’s customer purchasing problem.

Answer:

Recently, the biggest problem in the company’s operating is the relationship with customers. It’s hard to distinguish every deal, which leads the company can’t hold the market and satisfy every customer’s need. The company already adopted the ERP system to sell furniture to customs. Though the ERP system enjoys many advantages like reducing the barriers of currency, exchange rates, language and culture, ERP system only support internal organization business processes and record internal, supplier and customer transactions. (Considine B, 2008) To solve the problem in this case, involved CRM system, an outwardly organized system, which can help a business to organize and manage its customer relationships, is necessary.

CRM stands for Customer Relationship Management, which is an IT term for the methodologies, strategies, software and other web-based capabilities that help an enterprise organize and manage customer relationships.” Also, CRM is a business wide strategy more than a functional strategy which is designed to reduce costs and increase profitability by solidifying customer loyalty by brings together information all data sources within and outside the business to give one holistic view of each customer in real time (Considine B, 2008). There is no doubt that every firm’s aim is stay predominance in the competition. The core is the management method and the company’s reputation. Thus, good customer relationship could help the company conduct business and generate revenue.

How to implement CRM system

As discussed, adopted CRM system can help the Fabulous Furniture find a new way to increase their market share and to retain their existing client base. Its goal is to return to one-to-one personal marketing. The idea is to create a customer centric marketing and sales approach based on cumulative vital information about a customer such as her previous purchasing trend, preference and needs. (http://ezine.rusbiz.com/). From the research, the best option is to adopt a CRM system in Fabulous Furniture is phase by phase. The implementation of a CRM system is treated as a six-stage process. (http://www.businesslink.gov.uk)

The first stage is collecting information. Fabulous Furniture should capture the information to identify their customers and categories their behaviors. Build files for every customer that Fabulous Furniture also could access to the information about their customers’ buying histories, preference, complaints and other data, so that they could better meet what customers want. Indeed, the information helps the company grasp the trend of market better, which also help the manager make plan for the company’s development.

The second stage is storing information. Store and manage the customer information in a relational database is the most effective way for the company. Definitely, a centralized customer database would allow Fabulous Furniture run their all system from the same source, which ensure everyone uses timely information.

Accessing information is the third stage. With the information collected and stored nicely, make the staff access the information effectively is what Fabulous Furniture should do.

Following on, the stage 4 - Analyzing customer behaviors. Use the information to find out the frequent visitor, and the things they interested in. According to this, Fabulous Furniture could analyses which kind of goods is most popular, and makes a plan to introduce relevant furniture to customers.

The fifth stage is marketing more effectively. Fabulous Furniture could gain a better understanding of their customers’ needs, desires and self-perception by using CRM. In this case, the company must hold some fix customers. Give the valuable customers some bonus or discounts might simulate sales.

The last stage is enhancing the customer experience. Just as a small group of customers are the most profitable, a small number of complaining customers often take up a disproportionate amount of staff time. If their problems can be identified and resolved quickly, the staff will have more time for other customers. Fabulous Furniture could set a reception desk to deal with customers’ complaint specially.

With implementing a successful CRM system, Fabulous Furniture could understanding of customer’s behavior and needs better, developing and implementing business strategies and supporting technologies that close the gaps between an enterprise’s current and potential performance in customer acquisition.

Benefits of CRM

CRM is not just the application of technology, but is a strategy to learn more about customers' needs and behaviors in order to develop stronger relationships with them. (http://www.businesslink.gov.uk) A properly implemented CRM system can bring significant benefits to organizations. That’s why I recommendation Fabulous Furniture should adopted that to solve their problem. Let's take a look at the advantages that a CRM or Customer Relationship Management system can bring. (http://www.customerservicepoint.com/crm-system.html)

1. Cost reduction.

Reduce marketing costs while trying to reach a specific revenue goal with existing customers. Or reduce costs when get revenue by acquiring new customers. Easier to find the customers’ need, less order entry and customer support staff is needed.

2. Better customer service

All data concerning interactions with customers is centralized. Identifying needs more effectively by understanding specific customer requirements. The customer experience is greatly enhanced.

3. Increased customer satisfaction

There is no doubt that customer satisfaction will go up with the good customer service. Fabulous Furniture could know clearly about every deal, which could serve customer better than before. The more you know about your customers, the easier it is to identify new prospects and increase your customer base.

4. Better customer retention

CRM system could help Fabulous Furniture to solidify customers, which will increase customer loyalty and the company’s profit. They will keep coming back to buy the furniture again and again. Enhanced customer satisfaction and retention, ensuring that your good reputation in the marketplace continues to grow

5. More repeat business and new business.

Increased sales through better business increased. More business at lower cost equals more profit.

Adopting a successful CRM system could help Fabulous Furniture to gain an insight into the behaviour of their customer and deal with customers effectively and efficiently. Through CRM system Fabulous Furniture can increase patient loyalty and retention and acquire new customers. In a word, to the problem in Fabulous Furniture, the recommendation way is adopting the CRM system, which increased value from the existing customers, reduced cost associated with supporting and servicing them and enhanced customer satisfaction and retention, increasing your overall efficiency and reducing total cost of sales.

Bibliography

1. Considine B, et al (2008) Accounting Information Systems – understanding business processes. John Wiley & Sons Inc., Milton Qld, 2nd Edn. Will be referred to as: Cons

2. Nowshade Kabir. 2005. How to Implement a CRM System. Retrieved 8th June, 2008, from

http://ezine.rusbiz.com/article/How_to_Implement_a_CRM_System.html

3. The national b2b centre. 2007. Customer Relation Management. Retrieved 8th June, 2008, from

http://www.businesslink.gov.uk/bdotg/action/detail?type=RESOURCES&itemId=1075422950

4. The national b2b centre. 2007. Customer Relation Management- Introduction. Retrieved 8th June, 2008, from

http://www.businesslink.gov.uk/bdotg/action/layer?r.l1=1073861197&r.l3=1075422922&topicId=1075422922&r.t=RESOURCES&r.i=1075422950&r.l2=1075422920&r.s=sc

5. Customer service point. 2007. Benefits of a CRM system. Retrieved 8th June, 2008, from

http://www.customerservicepoint.com/crm-system.html