The Role of Relational Information Processes and Technology Use in Customer Relationship Management

Abstract

Drawing on the relationship marketing and market information processing literature streams, the authors conceptualize and measure relational information processes, or organizational routines that are critical for customer relationship management (CRM). The authors examine the key drivers and outcome of relational information processes and the role of technology in implementing CRM using data collected from a diverse sample of firms. The results show that relational information processes play a vital role in enhancing an organization's customer relationship performance. By moderating the influence of relational information processes on customer relationship performance, technology used for CRM performs an important and supportive role. The study provides insights into why the use of CRM technology might not always deliver the expected customer relationship performance outcome.Satish Jayachandran is an associate professor (e-mail: Satish@moore.sc. edu), and Subhash Sharma is James F. Kane Professor of Business (e-mail: sharma@moore.sc.edu), Moore School of Business, University of South Carolina. Peter Kaufman is an assistant professor, College of Business, Illinois State University (e-mail: pkaufma@ilstu.edu). Pushkala Raman is Assistant Professor of Marketing, Texas Women's University (e-mail: dr_p_raman@yahoo.com). The authors thank the Teradata Center for Customer Relationship Management at Duke University and the Center for International Business Research at the University of South Carolina for financial support. They also thank the consulting editors, Richard Staelin and William Boulding, and the two anonymous JM reviewers for their helpful suggestions. R elationship marketing scholars have long advocated that pursuing long-tem relationships with customers instead of a transaction-oriented approach is more profitable for firms (e.g., Morgan and Hunt 1994). Customer relationship management (CRM) is a core organizational process that focuses on establishing, maintaining, and enhancing long-term associations with customers (Srivastava, Shervani, and Fahey 1999). The rapid advance in information technology (IT) has presented firms with new technology-based solutions-namely, CRM technology-to manage customer relationships. Such technology is a suite of IT solutions designed to support the CRM process (Rigby, Reichheld, and Schefter 2002). Many firms have invested in CRM technology (Day 2000), hoping to discriminate between profitable and unprofitable customers, provide customized service, and obtain greater customer retention (Peppers, Rogers, and Dorf 1999). However, the results of using CRM technology have been mixed (e.g., Reinartz, Krafft, and Hoyer 2004), and this has created substantial concern about its viability and effectiveness (Rigby, Reichheld, and Schefter 2002). The business press also gives conflicting accounts about the efficacy of CRM technology (e.g., Whiting 2001), and research on this issue has been limited (Winer 2001).The unease with CRM technology use is similar to the disillusionment that f...

Mobile Customer Relationship Management: a communication perspective

“…Liljander et al 2007, Valsecchi et al 2007. However, according to the current study mobile CRM communication involves each functional area, namely marketing, sales and service, of CRM (Xu et al 2002, Jayachandran et al 2005 although it is, in many cases, quite hard to make a distinction between the different functional areas when it comes to messaging based communication through the mobile medium. Furthermore, mobile CRM, as a part of CRM, has a long-term focus on customers and, thus, communication is predominantly continuous and interactive with the customers.…”

“…Empowered by advanced technologies, companies can, among other things, gather an unprecedented amount of data on their customers, and, subsequently, turn this data into customer knowledge (Bose 2002). Accordingly, a customer database enables information on customers from all relevant departments to be centralized in order to further use it intelligently to develop relationships with those customers (Reinartz et al 2004, Jayachandran et al 2005. In addition, providing the consistent service regardless of the channel the company chooses to interact with its customers is largely enabled by intelligent technology (Greigthon 2000, Bradshaw & Brash 40 2001, Chen & Popovich 2003).…”

“…This demands improving and coordinating information across time and contact channels to manage the customer relationships systematically (Reinartz et al 2004, Thomas & Sullivan 2005, Richards & Jones 2008. Companies can interact with the customers more appropriately when the information on them is detailed and up-to-date (Jayachandran et al 2005). The essence of CRM is, thus, to learn about customers needs and identify how best to satisfy them (Srivastava et al 1999).…”

“…Parvatiyar and Sheth 2001, Reinartz et al 2004, Jayachandran et al 2005, Palmatier et al 2006. The emphasis CRM places on relationships is also redefining how companies communicate with their customers.…”

“…It is sometimes forgotten that communication in CRM is not only about sales, but about marketing and service activities as well (Jayachandran et al 2005, Xu et al 2002. Bearing this in mind, one channel may function mostly as an information source for customers, while another channel may serve as the sales channel (Berman & Thelen 2004).…”