Implementation of Customer Relationship Management (CRM)

Executive Summary

Nowadays, organisations across the globe are increasingly implementing the technology driven Information Systems not only to achieve higher levels of customer satisfaction but also gain a competitive edge over their rivals. The companies are shifting their strategies from product oriented to customer oriented. Not only multinationals but also SME's are increasingly seeking to implement IS in order to find competitive advantage which is to base their business's prospects for longevity.

The report proposes the implementation of Customer Relationship Management (CRM) for Benchmark Asset Management Company to address the important issue of low customer satisfaction that is having a negative impact on the business. The report is divided in the three parts. Part one gives the overview of the organisation. After having described the causes of low customer satisfaction in part two, an attempt has been made to apply and evaluate the implementation of strategic CRM framework and solution in part three.

Emergence of Exchange Traded Funds

Exchange Traded Funds (Etfs) popularly known worldwide are a hybrid financial investment vehicle - a cross between stocks and mutual fund. Like a stock it can be traded on the stock exchange and like mutual fund it comprises of a diversified portfolio. Etfs first came into existence in 1993when State Street Global Advisors together with the American Stock Exchange (AMEX) developed and launched the ETF market. The name of the product was SPDR (Standard & Poor's 500 Index Depository Receipts) which tracks the S&P 500 index, continues to be the most successful product. Since then the Etf markets have grown rapidly. The US remains the world's largest market place, followed by Europe. About 60% of trading volumes on the American Stock Exchange is in Etfs,¹ and according to Morgan Stanley Etf assets are expected to rise to US$2 trillion in 2011.

India's first Etf, Nifty BeES was launched by Benchmark Asset Management Company Pvt. Ltd. (BAMC) in December 2001. It is based on the popular S&P CNX Nifty Index. Since then big fund houses like Reliance Capital, Kotak Mutual Fund have launched etfs that track various indexes like the CNX Banking Nifty index, the public sector unit bank index and the gold commodity.

Etfs offer the investors the convenience of:

  • Intra-day trade at low cost
  • Low expense ratio of about 1% as compared to 2 to 2.5% of the open or closed ended mutual funds
  • Trade price very close to the NAV (Net Asset Value) of the fund on the stock exchange

The investors are always looking for safe and secure tool of investment that provides them good return on investment. Etfs offer them an exposure to a diversified range of sectors rather than a particular company and are easy to trade and liquidate.

The Organisation

Benchmark Asset Management Company

Benchmark Asset Management Company Pvt. Ltd. (BAMC) is based in India and established in June 2001 focuses on indexing and quantitative investing. Benchmark has pioneered many investment products in India, including the First ETF (Exchange Traded Fund) in India - Nifty BeES, the First Money Market ETF in the world - Liquid BeES and the First Gold ETF in India - Gold BeES. In fact Benchmark was the first in the world to conceive the idea of Gold ETF. BAMC currently manages a number of financial products. Currently the company was three branches in Ahmedabad, Bangalore and New Delhi with its head office in Mumbai. The total asset under management (AUM) of Benchmark is 1551² crores INR in Etfs and a total of 2445 crores INR in all its products.

The three main categories of investment tools offered by BAMC are

  1. BeES (Benchmark Exchange Traded Scheme): A family of exchange traded funds which are basically mutual funds schemes that combine the features of open ended and closed ended funds. ETF are like stocks, listed on NSE, easy to liquidate, can be traded throughout the day in demat form. The list of etfs managed by BAMC are
    • Nifty BeES - based on S&P CNX Nifty Index in India.
    • Junior BeES - based on CNX Nifty Junior Index, which constitute the midcap companies
    • PSU Bank BeES - on the CNX PSU Bank Index, which constitute 12 Public Sector Banks in India
    • Bank BeES - based on the CNX Bank Index.
    • Gold BeES - to provide returns close to the Gold in local market of India
    • Shariah BeES - based on S&P CNX Shariah Index.
    • Liquid BeES - based on Crisil Liquid Fund Index.
  2. Open Ended Schemes
    • Benchmark Derivative Fund (BDF) - based on Crisil Composite Bond Fund Index and S&P CNX Nifty
    • Benchmark Equity and Derivative Opportunities Fund(BEDOF) - based on Crisil Balanced Fund
    • S&P CNX 500 Fund - Based on S&P CNX 500 Index.
  3. Portfolio Management Schemes ( PMS )
    • STraP - Systematically Traded Portfolio
    • CaPPS - Capital Preservation Portfolio Scheme
    • Benchmark Debt Portfolio (BDP)- Structured Products

These are the Nifty Linked Fixed Tenure Debenture under which the client will receive a fixed participation on his investment for any positive or negative movement of the Nifty Index.

Philosophy of the Organisation

Benchmark is a passive management company and the investment philosophy of the fund is not to beat the index but to track the same. The fund uses indexing and quantitative approach to achieve this objective.

Benchmark believes in

  • Adding value to the company by providing enhanced levels of services
  • Focussing on generating awareness amongst the investing population and constantly endeavour to introduce new and innovative products with the goal to achieve superlative growth and
  • Manage relations across all channels and hence getting to the holy grail of one to one marketing.

Organisation Structure

The structure diagram of Benchmark is as shown

The organisation comprises of 3 departments namely Marketing and Sales, Operations and Investments. The departments are headed by their respective executive directors. The customer service is a part of marketing and sales department.

Customer Profile

The target customers of Benchmark are the private financial institution, high net worth individuals, corporate business houses.

Different segment of clients are managed by the respective sales manager who manage the relationship and are the first point of contact between the customers and Benchmark.

  • The financial institutions are the banks, the insurance companies who use etfs to gain short term exposure to the market quickly, effectively and economically.
  • The corporate clients include the various business companies who use etfs to park their surplus cash which can be used in the future.
  • The High Net worth Individuals (HNI) invest in etfs as it is a more secure and safe vehicle as it tracks the particular index and not a particular company. The other important factor is the ease of trading and liquidating the securities.
  • The target clients for the PMS products are HNI and the minimum investment amount is 10,00,000 INR.

The Competition

Currently Benchmark is a Small and Medium Enterprise and is the market leader in Exchange Traded Funds managing an approx 1550 crores INR in all its etfs.

The competitors to BAMC are Reliance Capital, Kotak Mutual Fund and UTI AMC who have etfs in the similar sectors. But these companies have a wide and diversified range of other open ended and close ended mutual fund schemes. These larger companies are all together in a different league as they have their own channel of distributions and wider resources. They are the large cap fund houses that focus on active management of funds.

The Business Problem

Benchmark's current marketing strategy is primarily based on maintaining personalised relations with its clients. Once the client invests in a product or scheme of the company they not only expect good returns on investment but also time to time update on the status of their investment. Thus need for an appropriate after sales service is important for creating a good image in the mind of the client. The information system consisting of people, information technology, processes and structure plays a vital role in creating this.

At present there isn't one comprehensive system which has all the information and details of the existing clients and their investments. Currently the information about the clients is scattered and stored scheme wise in excel sheets and MS Word. Hence when a client requests the customer service for the status of their investments with Benchmark, the customer service has to look up individually to get the required data and whole process takes considerable amount of time. Also most of the times required information is to be obtained from the custodian who keeps track of the day to day holding of the clients in various products. This causes long response time of about 2 to 3 working days. As a result customer experience low level of after sales service satisfaction. Hence there is a need for an information management system that allows the details to be provided to the clients in a few clicks.

For the business to grow it is essential to acquire new clients and provide appropriate services in order to build a long term relationship. The concept of Etfs is relatively new to the ever growing capital market in India.

In order to create product awareness and to reach a larger market, Benchmark has tied up with NSE (National Stock Exchange) and organises seminars and camps for the members of NSE in various parts of the country. Also a number of IFA (Investment Financial Advisors) meets and HNI meets are being organised regularly. After the initial product campaign has been set by the sales department, the potential investors enquire for further details and statistics about the products. The customer care is not able to provide these minute technicalities due to lack of information. Therefore these queries are passed on to the sales department to attend. There isn't any system which keeps a call log about the queries of the clients which are to be answered by the sales department. The customer care conveys these queries to the sales managers verbally or through email. It takes 2 to 3 days to respond to these queries. Hence the process of reverting back to client is long, lengthy and error prone.

Proposed IS Solution

Implementation of Customer Relationship Management (CRM) would be the proper solution for the business problem of Benchmark.

Defining CRM

"The Customer Relationship Management is defined as a strategic orientation that calls for iterative processes designed to turn customer data into customer relationships through active use of, and learning from, the information collected" (Piccoli, 2008).

Chris Todman, in his book: Designing a Data Warehouse: Supporting Customer Relationship Management, defined CRM as "A strategy for optimizing lifetime value of customers" by achieving two things

  1. Getting to know your customer better
  2. Interacting appropriately with your customers

Francis Buttle the Guru of CRM in his book: CRM Concept and Technologies, defines CRM as follows

"CRM is a core business strategy that integrates internal processes and functions, and external networks, to create and deliver value to the customers at a profit. It is grounded on high quality customer-related data and enabled by information technology."

The CRM governs an organisation philosophy at all levels, including policies and processes, front of house customer service, employee training, systems and information management.

Selection of CRM Framework

A number of CRM frameworks were considered and evaluated like the Payne's model of CRM, the CRM value chain model by Francis Buttle and the Strategic CRM Approach model by Kumar and Reinartz. Payne (2005) offers the opinion that his CRM model is more suited to large industrial companies with complex processes and systems. To test this, for the purposes of this report, Payne's model was applied to identify a SIS solution to the business problem. This confirmed Payne's opinion of the limitations of his model to an organisation such as Benchmark. For this reason, Payne's model is not an appropriate framework with which to identify the SIS solution. Similarly CRM value chain model is also more suitable for large companies with complex processes.

Strategic CRM by Kumar and Reinartz is the model used in the paper as it addresses the key concern of management of profitable customer relationship. It provides a systematic roadmap to make CRM strategy successful in the organisation. And also it is simple and convenient to analyze and evaluate.

Strategic Approach of CRM

The strategic approach of the CRM is an adaptation of the CRM throughout the company for front-end and back-end systems. The front end systems are for customers and back end systems provide company means to analyse and develop new products. The development of a customer-centric culture is an important aspect of strategic CRM. "This culture is dedicated to winning and keeping customers by creating and delivering value better than competitors." (Buttle, 2008)

In strategic CRM, the approach of company is customer-centric. The processes are driven in a way to provide value to the customers.

The components of Strategic CRM Approach (Kumar, Reinartz, 2006, Page 33) are

  • Customer Management Orientation
  • Integration and alignment of organizational processes
  • Information capture and alignment of technology
  • CRM strategy implementation

Thus strategic crm consists of the four major components and its success depends on the proper implementation of all components.

Customer-Management Orientation

"Customer-Management Orientation is defined as the set of values, beliefs and strategic actions of the organization that enable the implementation of customer management principles". (Kumar-Reinartz, 2006)

Customer-management orientation is a commitment of the senior management towards the customer's requirements and is a critical factor to the success of strategic CRM implementation. It recognizes that the customers differ in needs and economic value to an organization and it is reflected in the way they interact with different customers differently. Thus the customers are of critical importance to any organization and therefore should be the focal point. There is requirement for the management to define the organization mission which is customer centric.

The suggested mission statement for Benchmark is

"Our mission is to offer our investing clients the finest asset accumulation, investment and wealth management products, services and support. We desire to reflect the commitment made by Benchmark to increase the depth and breadth of the Benchmark Asset Management Company for the benefit of our stakeholders and clients."

Customer Management Orientation is vital in customer retention. Customer retention can be achieved by creating customer value and by customer satisfaction. In order to achieve this all policies of the organization must be customer oriented.

Customer satisfaction depends upon the relationship of the employee with the customer. The behaviour of the employee in turn depends upon the culture of the organization. The management plays a vital role in employee orientation and thus the employee behaviour. Employee orientation requires proper training of employees to adapt and get familiarized with the change in the work environment due to the change in systems. Therefore sharing of common values and belief by employees plays an important role in customer satisfaction and retention.

Hence it is essential for the management of Benchmark to inculcate the value of importance of its clients within all its employees. The company should get its employee involved in the crm initiative early on, to get their buy in and active participation in the project.

Integration and Alignment of the Organizational Processes

The second step in implementing of the strategic CRM is the integration and alignment of organizational process. It involves the creation and synchronization of processes and systems throughout the company. As various departments of the company are linked together, one process of one department can affect the workflow of the other.

There is a belief that the CRM system affects the activities and processes of sales and customer service department only. When interacting with a company's sales or customer service, the customer experiences a combined result of internal activities such as product development, IT support and human resource management (Kumar-Reinartz, 2006). Hence it is essential that the processes of the all the departments of the company are aligned so that it results in the benefit and value to the client.

Benchmark need to compile a list of top hundred customer related queries to study existing process with customer feedback/suggestion program. Based on this report, adopt improved process to increase productivity and customer satisfaction. It should review customer-facing processes in detail and make necessary corrections prior to implementing the technology of CRM initiative.

Information Capture and Alignment of Technology

"Information capture and alignment of technology comprises all the technology and processes necessary to collect store and process relevant and timely customer information which would enable the implementation of CRM". (Kumar-Reinartz, 2006)

For this the organization should develop and use database management method. Relational databases are now the standard architecture for CRM applications (Buttle, 2008,). It helps organization to capture a comprehensive customer profile of their clients which helps in better customer segmentation and targeting. The company can collect the customer's information by many channels and functions. Proper integration of the databases is the key factor for successful implementation of the CRM. "Failure to integrate databases may lead to inefficiency, duplication and damaged customer relationships" (Buttle, 2008). Data integration and analysis plays an important role in CRM strategy and implementation.

The model shown below will help the company to capture and integrate the information about its customers. The data about the customers that is collected from the various channels as shown will be stored in the integrated central customer database. The data analysis and mining phase is used to analyze the useful data and thus help in CRM implementation.

CRM Strategy Implementation

The success of Strategic CRM depends upon the successful implementation of two fundamental components of CRM.

Operational CRM: it is the customer facing application of CRM---the aforementioned sales automation, enterprise marketing automation and customer service (Greenberg 2000,). The operational CRM focuses on the automation of horizontally integrated business processes.

Operational CRM provides automated support to front office (sales, marketing and service). All the interaction with the customer is added to the customer history and employees can retrieve information on the customer from the database.

According to Gartner Group ( operational CRM normally involves three core areas.

  • Sales Force Automation (SFA)
  • SFA which automates company's critical sales and sales force management tasks such as sales administration, tracking customer preferences.

  • Customer Service and Support (CSS)
  • CSS automates certain service requests, complaint, product returns and enquiries

  • Enterprise Marketing Automation (EMA)
  • EMA provides information about the business environment, including information on competitors, industry trends and macro environmental variables. EMA applications are used to improve marketing efficiency.

Analytical Crm: it analysis the data gathered by the operational CRM, or from other sources which can be used to improve the company's relationship with its clients. The result of this analysis can be used to plan targeted marketing campaigns like

  • Acquisition : cross selling, up-selling
  • Retention: retaining existing customers
  • Information: providing timely and regular information to customers

The process of data collection and analysis is a continuous and iterative process. It provides the means to refine the business decisions overtime, based on the feedback from the earlier analysis and decisions.

In the first phase the company must implement the operational CRM as it would help overcome the current problem of customer satisfaction and also aid the sales department. The problem of providing the technical details about the various products would be solved by EMA.

The second phase is the implementation of the analytical CRM which helps in cross selling thereby retaining the existing customers and also analyze and help management to analyze the behaviour pattern of the clients and thereby allowing modifying existing products and developing new products according to customer needs.

Proposed CRM Configuration for Benchmark

The figure below shows the block diagram of the proposed CRM configuration for Benchmark. Having a customer facing CRM system will help in a number of ways

  1. The customer interface which consist of order services and manage accounts will provide the customer direct access to request subscription for new product and at the same time will allow them to get a quick update about the status of their portfolios.
  2. Sales interface includes managing campaign and key accounts which will help the sales to manage product campaigns and manage existing and acquire new clients. Sales force automation is an application of computerized technologies to support sales people and management in the achievement of their work related objectives (Buttle,2008).
  3. The customer service will now be able to provide a quick response to the clients about their portfolios and answer their queries precisely. Also as the customers will now be able to check their status by themselves this would leave the customer service to answer the more complex inquiries about the various products.
  4. As the information is now contained in the central database system it will not only help achieve faster response time and thus higher level of customer satisfaction but also provide the management with a tool to analyze and study client investment patterns and thereby modify existing products and develop new ones.

Critical Analysis

Customer Relationship Management is an excellent system to develop an IS geared towards satisfying and driving value to the customers.

There is a risk that the project involves time investment initially and benefits may not be seen immediately. This is the most important stage as the success of project depends on this stage. Hence it is important to gain employee and senior management support and buy in at this critical stage in order to ensure success. The role of senior management is very vital as they help binding of people, process and technology for successful implementation.

Although the initial cost of implementation is high the company would greatly benefit from this strategic initiative as it would provide the company with an integrated information system of its clients. Using this information the company can provide improved services and develop new products for its existing and new customers.

Among numerous factors, a limited number play an important role in the success of CRM in Benchmark. These are the Critical Success Factors (CSF's) listed below

  • To establish measurable business goals i.e. reduce response time by 50%
  • To align business and IT operations to improve customer- facing processes
  • Getting Management support upfront
  • Avoid over customization of technology to prevent budget overruns and missing deadlines
  • Using trained and experienced consultants as they can translate business requirements in to software configuration
  • Actively involve the end users in design and invest to train them
  • Measure, monitor and track system effectiveness to continuously improve performance


Thus the implementation of Customer Relationship Management in Benchmark would provide

  1. An integrated and unified information system.
  2. Ability to query customer detail and information quickly
  3. Facilitate to build client profile and compile customer information across its multiple products and present it in a concise and clear format.
  4. Build up a resource of minute technicalities of the individual products which can be referred to by the customer service thereby resulting in quicker response times and improved service.
  5. A system to record customer feedback and leads which would help in targeting new products and new segments.


  • Piccoli G, (2008), Information systems for Managers, page 384
  • Todman Chris, (2001) Designing a data warehouse: supporting customer relationship management
  • Buttle F, (2008) Customer relationship management- Concepts and technologies 2nd edition pg 4, pg 110
  • Kumar V., Reinartz W., (2006) Customer Relationship Management: A Databased Approach, pg 33, 34, 35.
  • Dyché J., (2001). The CRM Handbook: A business guide to customer relationship management
  • Foss B., Stone M., (2002) CRM in financial services: a practical guide to making customer relationship management work
  • Greenberg Paul (2000) CRM at the speed of time---Capturing and Keeping Customers in Internet Real Time
  • Payne A. and Frow P., (2005) "A Strategic Framework for Customers Relationship Management", Journal of Marketing, Vol. 69, October 2005, pp 167-176
  • Rigby D., Reichheld F. and Scheffer P., (2002) "Avoid the four perils of CRM", Harvard Business Review, Vol. 80(2), pp 101-109
  • International Marketing Review, (2004) Sustainable competitive advantage of internet firms: A strategic framework and implications for global marketers Source: Volume: 5; Issue: 6. ETFs and Indexing: Benchmark Asset Management Company and CNBC TV18 publication

Web Sources

  • The National Stock Exchange of India Website
  • Association of Mutual Funds in India website

Please be aware that the free essay that you were just reading was not written by us. This essay, and all of the others available to view on the website, were provided to us by students in exchange for services that we offer. This relationship helps our students to get an even better deal while also contributing to the biggest free essay resource in the UK!