Professional Documents
Culture Documents
(11123030)
MBA (3 YEARS)
SAAD JAMIL IRFANI
(10108034)
BBA
Table of Content
1
Abstract.................................................................................................................. 6
Introduction.......................................................................................................... 7
2.1
Rational of Study................................................................................................ 7
2.2
Significance of Study........................................................................................... 8
2.3
Research Gap..................................................................................................... 8
2.4
Problem Statement............................................................................................... 9
2.5
Research Question............................................................................................... 9
2.6
Research Objectives............................................................................................. 9
2.7
Delimitation of Study........................................................................................... 9
Literature Review............................................................................................... 10
3.1
Information Technology...................................................................................... 11
3.2
Management Commitment................................................................................... 12
3.3
3.4
Organizational Culture................................................................................. 13
Conceptual Framework............................................................................................. 13
4.1
Dependent variable............................................................................................ 13
4.2
Independent variables......................................................................................... 13
4.3
Framework................................................................................................... 14
4.4
Hypothesis................................................................................................... 15
Methodology.......................................................................................................... 15
5.1
Sample Selection............................................................................................... 15
5.2
Population frame............................................................................................... 16
5.3
Unit of analysis................................................................................................. 16
5.4
Type of study................................................................................................... 16
5.5
Time horizon.................................................................................................... 16
5.6
Instrument development/selection..........................................................................16
5.7
5.8
5.9
Data Analysis......................................................................................................... 17
6.1
6.1.1
Missing Value......................................................................................... 18
6.1.2
Outliers.................................................................................................. 18
6.1.3
Normality............................................................................................... 18
6.2
Demographic Analysis.................................................................................19
6.3
Reliability..................................................................................................... 20
6.4
Factor Analysis............................................................................................. 21
6.5
Descriptive...................................................................................................... 22
6.6
Correlation...................................................................................................... 24
6.7
Regression....................................................................................................... 25
Discussion.......................................................................................................... 27
Implication......................................................................................................... 28
Conclusion.......................................................................................................... 28
10
Appendices..................................................................................................... 29
11
References...................................................................................................... 31
List of Tables
Demographic ..19
Reliability 20
Exploratory Factor Analysis ...21
Descriptive Statistics 22
Correlation 24
Regression .25
List of Figures
Theoretical
Framework.14
List of Appendices
Questionnaire.29
List of Abbreviations
CRM
IT
Information Technology
MC
Management Commitment
HRK
OC
Organizational Culture
SPSS
EFA
EDA
CFA
KMO
Kaiser-Meyer-Olkin
SD
Standard Deviation
Sample size
df
Degree of Freedom
SE
Standard Error
1 Abstract
Establishing strong relationships with customers is the most important thing for any kind of
business. Basically organizations have understood that customers are their most important
assets and view customer relations (CR) for profitable transactions and requiring management.
CRM is a business strategy through which organizations retain and attracts the customers. The
proper implementation of this strategy will help the organizations to retain and attracts the
customers at lower cost. This research paper, tries to identify the success factors which affects
CRM system. The main purpose of this study is to determine and identify the success factors
affecting Customer Relationship Management system. To achieve these goals the research model,
four hypotheses were formulated. To collect the data for this research questionnaire are used and
also the descriptive method was used to perform the present study In hypotheses test section,
three hypotheses Information Technology, Human Resource Knowledge and Organizational
Culture were accepted and one hypothesis (Management Commitment) was rejected.
Keywords: CRM (Customer Relationship Management), Organizational Culture, Management
Commitment, Human Resource Knowledge, Information Technology.
2 Introduction
2.1 Rational of Study
In this modern era the competition is becoming large between organizations or companies day by
day. Organizations are always in search of new solutions which can help them in maintaining their
position and increasing the efficiency of their businesses. Organizations or companies around the
world started re-engineering and restructuring their business processes to cut the costs and become
more competitive and efficient.
In this regard Customer Relationship Management (CRM) has risen to the agenda of many
organizational strategies. Customer Relationship Management (CRM) is a business strategy that
attracts, elevates and retains customers. It defines all aspects of interaction and relations that a
company has with its customers; however the company is sales or service oriented. Customer
Relationship Management (CRM) is basically the most important thought of a business strategy that
helps businesses and organizations to understand the customer and also retain the customers by
winning new clients and contracts, through better customer experience, increase profitably, attract
new customer and also decrease the customer management costs.
In order to attract more customer satisfaction, first we have to identify their expectations and
requirements and then services are developed according to their requirements and expectations.
Information technology has significantly changed all business processes. Customer Relationship
Management is the most important issue for organizations because it is use to support effective
marketing, sales and services processes. With the advancement in technology, available instruments
for establishing customer relation (CR) and customer relationship management (CRM) have become
prevailing in organizations. Now customers have higher expectations than the past because they
want to purchase and to be served from different communication channels like telephone, internet
and e-mails. Basically now organizations cannot content themselves on the past strategies anymore
and also they have to adapt themselves with new techniques, market advancement and ever changing
customer requirements. The research will examine the main features or components affecting a CRM
systems success because in Stone Age Company it is believed that Customer Relationship
Management has been built on the basis of customer-organization value exchange and this mainly
emphasizes the value created in this respect. Therefore Stone Age Companys efforts for the
development of the long term Customer Relationship Management (CRM) is based on mutual value
creation as an important management goal. To achieve this, the Stone Age Company has to try to
identify the strategical factors affecting its CRM systems success and develop profitable
relationships based on optimization of customers received and perceived value through it, which
would explain the reason for which the present study is being conducted.
2.2
Significance of Study
What are the success factors that affect in CRM (customer relationship management)
systems?
systems.
To estimate whether those factors are important in the success of CRM system.
the other hand there are many other variables which express customer relationship
management.
3 Literature Review
The basic fundamental of CRM is the philosophy of customers and marketing which in turn has
been derived from the marketing to create relationships with every person related to the
organization (Kotler, 2003). In marketing Customer Relationship Management is defined as a
communicating tool between organization and customer for the purpose of maintaining and
attracting the customers who will become the loyal and the true customers of an organization.
There are many studies that have been made to identify CRMs components. In this regard Buttle
(2004) has named four factors that having impact on Customer Relationship Management which
includes the culture of an organization, leadership and people means the human resource and also
information technology.
According to Chen the main and main key factors of Customer Relationship Management are
technology, people and processes. As a matter of fact, the four items suggested by Combe
(2004), to propel CRM are composed of leadership, culture, technology and people. Customer
Relationship Management mainly focuses on enabling organizations to provide better services to
customers through creating integrated, reliable and automatic processes which tries to cover this
great phenomenon in different ways such as processing, integration and gathering information.
According to this definition this is said that the main agenda of Customer Relationship
Management (CRM) is to increase the satisfaction between customer and organization, as well as
enhancing the benefits and elevating the efficiency in logistics, marketing, sales and services.
Basically customers are seeking benefits and expect value added from organizations more than
products.
For many organizations Customer Relationship Management became popular means it is the
most important tool which overcomes the issues of expanding markets, increased competition
and increasing customer expectations (Richard & Jones, 2008). The main objective of Customer
Relationship Management is to create organization customer oriented that increases the customer
value and long-term organizational profitability through durable relationships with customers
and realization of mutual beneficial. Over the last decade many popular brands has practices this
strategy in different ways to capture potential customers in market. A good Customer
Relationship Management (CRM) strategy is important for the brand name which helps in the
extension of a brand, while a very good CRM strategy also enhances the goodwill and also the
brand name. This strategy is mainly applied for the greater market share and further to attract
more and more customers in order to be successful & survive the in competitive market.
4 Conceptual Framework
4.1 Dependent variable
4.3 Framework
Information
Technology
Management
Commitment
Human Resource
Knowledge
Organizational
Culture
+ive
+ive
+ive
+ive
Customer
Relationship
Management
4.4 Hypothesis
H1: Information Technology has significant relationship with Customer Relationship
Management (CRM)
H2: Management Commitment has significant relationship with Customer Relationship
Management (CRM)
H3: Human Resource Knowledge has significant relationship with Customer Relationship
Management (CRM)
H4: Organizational Culture has significant relationship with Customer Relationship
Management (CRM)
5 Methodology
The purpose of this section is to describe the methodology which had been carried out to
complete the work. The methodology plays a dominant role in any kind of research work.
The effectiveness of any research work depends upon the correctness and effectiveness of
the research methodology.
for data collection Non probability convenient sampling technique is more appropriate for our
research.
6 Data Analysis
We have gathered data through questionnaire. Our population frame was employees and the
customers of Stone Age Company. We have collected data and final respondents after elimination
were 50. Now we are in a position to run different analysis on the data collected. First of all, data
is needed to be screened and cleaned.
We have checked the data to see any missing value. There was no missing value found in the
data. It is necessary to detect the missing values because it can affect the results.
6.1.2 Outliers
After checking the missing values, we had checked the data for outliers. Outliers affect the
normality of the data, which in turn can harm the results of the inferential statistics. We have
detected the outliers from the box-plots. After detecting outliers, we deleted the extreme outliers
and treated it as missing value. Then, we replaced the missing value through SPSS 19.0 by using
its Transform function and replaced the missing values with the mean of the series.
6.1.3 Normality
Third step was to check the normality of the data. Most of the statistics tools require the data to
be normal. So it is necessary to check the normality of the data.
Normality means that the data should be normally distributed. In other words, histogram drawn
from the data should be symmetrical. Further, shape of histogram should not be too peaked or
flat.
There are various ways to check the normality of the data. Most common tools are skewness and
kurtosis. In order to be normal, the values of skewness and kurtosis should be within the range of
-1 to +1. Skewness checks that whether the histogram is symmetrical. If the value is negative it
means the data is skewed towards left and vice versa.
Kurtosis checks the peakness and flatness of the curve drawn on histogram. If value is positive, it
shows peakness in the data. Negative value represents the flatness of the curve.
Values of skewness and kurtosis for all the variables are within +/- 1. However, there is slight
deviation for few items. It is acceptable.
Name
Gender
Male
Female
Age
21 to 25
26 to 30
Percentage (%)
76
24
25
58
Name
31 to 35
Income
11,000 to 25,000
26,000 to 35,000
36,000 to 45,000
45,000 onwards
Percentage (%)
17
47
41
11
1
Basically our respondents are the employees of Stone Age Company. The above table shows that
76% are males and 24% are females who filled the questionnaires that we provide and you can
see that in which age group employees are laying and also their income level is given in the
above table in percentages.
6.3 Reliability
It is necessary to check the instrument for stability and consistency. In other words instrument
should be reliable. There are various ways to check the reliability of the instrument. However, we
have calculated the reliability on the basis of inter-item consistency. From the SPSS we obtained
following results:
Table 2
Reliability
Serial no.
1
2
Variables
Information Technology
Management
Cronbachs Alpha
.731
.789
No. of Items
6
5
Commitment
Human Resource
.874
4
5
Knowledge
Organizational Culture
Customer Relationship
.890
.857
7
5
Management
According to Nulleiy (1967) value of Cronbachs alpha should be greater than 0.6 for an
instrument to be valid. In our case the value of Cronbachs alpha for all the variables (calculated
individually) is greater than 0.6. It means that there is high stability and consistency of items
measuring any variable.
Table 3
Exploratory Factor Analysis
S. No
1
2
3
4
5
6
7
Variance
IT
.518
.762
.617
.661
.651
.695
42.88%
MC
.687
.657
.725
.815
.815
55.14%
HRK
.623
.763
.819
.751
.830
.773
.711
57.10%
OC
.815
.770
.816
.747
.731
.761
.800
60.47%
CRM
.786
.773
.839
.808
.780
63.59%
Explained
KMO
Bartletts
.750
.000
.770
.000
.871
.000
.868
.000
.812
.000
Value of KMO should be greater than 0.6, variance explained should be greater than 40%,
component loading score for each item should be greater than 0.4 and Bartletts test should be
significant. In our case, total variance explained for information technology is 42.88%. It means
that approximately 43% variation is explained by the items measuring information technology.
Similarly, variance explained for management commitment, human resource knowledge,
organizational culture and customer relationship management is approximately 55%, 57%, 60%
and 64%.
Loading scores tell that how much a particular item explains the main variable/concept
out of 1. For example, the first item is explaining 0.518 of information technology out of 1.
Similarly, we can interpret other loading scores. Its value should be greater than 0.4. Our all
items have loading scores greater than 0.4. Some items had loading score less than 0.4, so we
deleted these items.
Value of KMO should also be greater than 0.6 in order to include a variable in the
research. If the value falls below this level, the variable is excluded from the research. In our
case, all the values are greater than 0.6. Lastly, results of Bartletts test should also be significant.
Otherwise, variables having insignificant value of Bartletts test are also excluded. Results of
Bartletts test showed that results are significant and all variables are included for the purpose of
the research.
6.5 Descriptive
After data cleaning and screening, we are in a position to get our variables from the items. For
this purpose, we had transformed the items into representing variable. SPSS 19.0 provides a
function to transform and compute variable.
After computing the variables, we had applied descriptive statistics tools on the computed
variables and obtained following results:
Table 4
Descriptive Statistics
Variable
IT
MC
HRK
OC
CRM
N
100
100
100
100
100
Minimum
Maximu
Mean
S.D
Skewness
Kuartasis
2.50
2.60
2.43
2.57
2.40
m
4.33
4.60
4.29
4.71
5.00
3.4700
3.5180
3.5171
3.6914
3.6320
.39239
.45137
.52313
.53287
.59745
-.661
.262
-.410
-.227
.025
.725
-.274
-.577
-.410
-.373
Our sample size was 100. Mean represents the average level. It is calculated by summing
up all values and dividing it by total respondents. Standard deviation tells about the spread of the
data. It is the square root of average of squared deviations from mean.
6.6 Correlation
Correlation tells us about the relationship between two variables. It tells us about the intensity
and direction of the relationship between the variables. Intensity is assessed through the
magnitude and direction is judged by the sign.
Table 5
Correlation
IT
MC
HRK
OC
CRM
Note: * Correlation is significant at p-value < 0.05
** Correlation is significant at p-value < 0.01
Table 4 represents the correlation between the variables. The correlation between
Information Technology and Customer Relationship Management is weakly positive, r (99)
=0.349, p < 0.01, which is considered as large effect size according to Cohen (1988). It means
that if information technology increases (IT), customer relationship management (CRM) also
increases. The result of this relationship will be applicable on the population 99% times.
6.7 Regression
Regression analysis is conducted to predict the dependent variable through independent
variable(s). It also tells how much the dependent variable will change by changing one unit of
independent variable(s).
We have tried to predict the Customer Relationship Management by using Information
Technology, Management Commitment, Human Resource Knowledge and Organizational
Culture as predictors. Before applying any analysis main assumption of multi-co linearity has
been checked and it showed mild relation between the predictors. In order to develop regression
equation, we had run multiple regression analysis on SPSS 19.0 and obtained following results:
Table 6
Multiple Regression analysis summaries for information technology, management commitment,
human resource knowledge and organizational culture predicting customer relationship
management.
Variables
S.E
t-value
Sig
Hypothesis
Constant
.096
.670
.143
.887
No
IT
.366
.137
2.675
.009
Hypothesis
Supported
MC
.073
.114
.645
.521
Not Supported
HRK
.321
.113
2.851
.005
Supported
OC
.238
.111
2.133
.036
Supported
7 Discussion
As mentioned earlier that CRM system is very important and its practical implication involves
complex structure to be followed. This study suggests that information technology has a
positively impact on customer relationship management. It means if information technology is
acceptable among the employees then the customer relationship management system becomes
easy for the employees of the organization.
On the other hand Management Commitment has negative impact on Customer Relationship
Management system which makes us to conclude that commitment of the management is very
important factor for the Customer Relationship Management system. Management should
therefore maintain their commitment with organization in such a way that they can trust their
organization whole heartedly. This study shows that Management Commitment of Stone Age
Company employees have negative impact on Customer Relationship Management system. It
shows that personals who fills the questionnaire doesn`t have trust on Stone Age Company up to
extent that they can accept the CRM system of Stone Age . This may happen because every
individual has its own preference about the CRM system.
Human Resource Knowledge has positive impact on Customer Relationship Management
system. This shows that employees of Stone Age Company has better knowledge about the
human resource (HR) and hence can accept the CRM system.
While talking about Organizational culture of Stone Age Company it also have positive affect
and there are more chances that they will accept the CRM system of Stone Age Company. It is
because the organizational culture of Stone Age Company is more friendly and not the autocratic
culture.
8 Implication
Our study has many implications for the companies and organizations that are using CRM
systems. First of all this study will help Stone Age Company to know about the success factors of
their CRM system. This study would suggest Stone Age Company that they have to build good
management commitment in their organization to get more success in CRM system.
Whereas they can know about the success factors which are affecting CRM system but there are
also many other factors which can affect in the success of CRM system implementation, which
may be neglected in this study.
9 Conclusion
This study provides an insight how the Information Technology, Management Commitment,
Human Resource Knowledge and Organizational Culture affects the Customer Relationship
Management (CRM) system of Stone Age Company. Data had been gathered from different
individuals who are basically the employees of Stone Age Company, through questionnaires.
After careful analysis we reached at a conclusion that information technology, human resource
knowledge and organizational culture positively affect in the success of customer relationship
management system of Stone Age Company. The results are consistent with previous studies.
However, relationships between management commitment and customer relationship
management system are not significant.
10 Appendices
Questionnaire
We are students of MBA and BBA in GIFT University Gujranwala and doing research on
DETERMINING FACTORS AFFECTING IN IMPLICATION CUSTOMER RELATIONSHIP
MANAGEMENT: THE APPLIED STUDY FOR STONE AGE for which the questionnaire is being
distributed to collect the empirical data. Therefore, you are kindly requested to fill this questionnaire. The
information provided will be kept confidential and will be used for academic purpose only. It will take 1520 min to complete the questionnaire. Thank you in anticipation
(Strongly Disagree=1, Strongly Agree=5)
Information Technology: The branch of engineering that deals with the use of computers and
2
3
4
SD
Neutral
SA
Management Commitment: Direct participation by the highest level executives in a specific and
SD
Neutral
SA
Human Resource knowledge: The process of hiring and developing employees so that they become more
valuable to the organization.
SD
D
Neutral
A
SA
1 A large number of people are involved in HR
1
2
3
4
5
2 planning in firm.
1
1
2
3
4
5
3 Firm adopts selectivity in hiring.
1 Firm has incentive practices which really
4 recognize people who contribute the most to
1
2
3
4
5
firm.
1
5
1
6
1
7
1
8
Organizational Culture: is the collective behavior of humans who are part of an organization
1
9
2
0
2
1
2
2
2
3
2
4
2
5
SD
Neutral
SA
SA
CRM
In our firm, resources are designated in way
that benefits of main customers are provided
2
9
3
0
Gender:
o
o
Male
Female
Age (Years):
o
o
o
o
o
under 20
21 to 25
26 to 30
30 to 35
40 to onward
Under 10000
11000 to 25000
26000 to 35000
36000 to 45000
46000 to onward
11 References
Buttle, F. (2004). Customer Relationship Management: Concepts and Tools. Amsterdam:
Elsevier.
C. Bull, (2003). Strategic Issues in Customer Relationship Management (CRM) Implementation.
Business Process Management Journal, 9 (5) 592 602.
Combe, C. (2004). Assessing Customer Relationship Management Strategies for Creating
Competitive Advantage in Electronic Business. Journal of Knowledge Management Practice, 5,
4-14.
Ferrel OC, Hartline DM (2005). Marketing Strategy, 3ed, Ohio: Thomson.
Gebert, H., Geib, M., Kolbe, L. M. and Brenner, W. (2003) Knowledge-Enabled Customer
Relationship Management, Journal of Knowledge Management, 7(5) 107-123.
Gibbert, M., Leibold, M. and Probst, G. (2002) Five Styles of Customer Knowledge
Management, and How Smart Companies Use Them To Create Value, European Management
Journal, 20(5) 459 - 469.
Greenberg, P. (2001), CRM at the Speed of Light: Capturing and Keeping Customers in Internet
Real Time, Osborne/McGraw-Hill, Berkeley, California.
Gronroos, C. (2000). Service Management And Marketing: A Customer Relationship
Management Approach. 2nd ed. Chichester, UK: John Wiley & Sons.
Kotler, P. (2003). Marketing Management. 7nd ed. Englewood Cliffs, NJ: Prentice-Hall.
I. J. Chen and K. Popovich, (2003). Understanding Customer Relationship Management (CRM)
People, Process and Technology, Business Process Management Journal, 9(5), 672-688.
Laudon, K., Laudon, J. (2002). Management Information Systems Managing the Digital Firm.
Seventh Edition Prentice Hall International NJ.
Luis E. Mendoza (2006). Critical Success Factors for a Customer Relationship Management
Strategy. Information and Software Technology 49 (2007) 913945.
McKie, S. (2001). E-Business Best Practices: Leveraging Technology for Business Advantage.
New York: John Wiley & Sons.
Mendoza, E., Marius, A., Prez, M. and Griman, C. (2006). Critical Success Factors for a
Customer Relationship Management Strategy. Journal of Information and Software Technology,
5, 913-945.