The role of e-CRM - Research Proposal Example

Research Proposal Assessing the role of e-CRM as a key success factor for SME’s in developing countries Name] [Date] Assessing the role of e-CRM as a key success factor for SME’s in developing countries Background to Context: Small and medium enterprises in today’s competitive market scenario are facing greater challenges as globalization of trade and expansion of major corporations cross borders makes it extremely difficult for such business to develop and implement strategies that can achieve customer acquisition. The strategies that are aimed at customer acquisition are becoming increasingly costly and less yielding for small and medium sized businesses to carry out. In times where global financial crisis has hard struck the developed countries, businesses operating in the developing countries are still somewhat saved from the effects of the global economic slowdown. Businesses performing under par in developed economies are seeking ways of making entry or expanding into developing markets that would further intensify the competition and small and medium enterprises need to adopt ways that are aimed at long term sustainability and profitability. One way of becoming efficient and effective is to focus on strategies that are aimed at achieving customer retention. Customer retention strategies focus more on the businesses’ existing customer base and implement ways of making customers aware of the utility they can obtain from the use of products / services offered by companies. This strategy allows businesses to educate their current customers who can then differentiate their products / services from others and at the same time act as brand ambassadors and promote company’s products / services to potential customers. From this it could be clearly suggested that customer relationship management (CRM) can play an important role in understanding customers’ preferences and patterns to employ successful business strategies. For small and medium enterprises the interaction with customers is frequent and it is therefore important for them to be able to respond to the customers’ needs in a better way. One of the innovations related to CRM has been e-CRM that could assist businesses to learn and respond to the changing competitive landscape much quicker that enables them to make opportunistic business decisions achieving efficiencies and significant improvement in their customer service. Objective: The objective of the proposed research is to develop a case for e-CRM strategies and tools as key to success for small and medium enterprises in developing countries. Project Aim: The proposed study would be a useful one to assess how e-CRM strategies and tools can help small and medium enterprises in developing countries can benefit from increased efficiency and effectiveness in terms of meeting the needs and requirements of customers and eventually improve their performance. Most of the literature available on e-CRM and its applications has remained focused on its role for businesses in developed economies however the proposed research extends the study by assessing possibilities of implementation of e-CRM as a key success factor for small and medium business operating in countries like India. The users of the report would be able to develop a thorough understanding of how e-CRM can become an integral element of the business model that SMEs can adopt to serve their customers’ requirements in the most suitable manner. Research Questions: How can Small and Medium Enterprises benefit from the implementation of CRM? What contributions e-CRM can make in helping Small and Medium Enterprises to develop their business strategies and achieve better results? What makes e-CRM a crucial element for success of Small and Medium Enterprises in developing countries? What are the future possibilities for e-CRM strategies and tools for Small and Medium businesses in developing economies? Rationale of Proposed Study The research questions set out for the study may not be exhaustive however the proposed research is set out to find suitable answers for these questions that will in fact help the researcher to establish a case for e-CRM and its applications for small and medium in developing countries that are currently facing tougher competitive conditions not only from the local big corporations but also foreign companies that are seeking stronger position in these markets. Literature Review E-CRM that has been defined in several ways is considered to be one of the most recent developments that have given a new insight to customer relationship management by companies. One of the definition of e-CRM states that “E-CRM uses information technologies in order to support strategically the execution of CRM. E-CRM is a combination of hardware, software, process, applications, and management commitment designed to support an enterprise-wide CRM business strategy that will optimize customer satisfaction, customer loyalty, financial performance and finally competitive advantage” (Khosrow-Pour, 2006, p. 706). The role of e-CRM is considered to be of high significance for SMEs as it allows such businesses to achieve efficiencies and competitive advantage. Business can use various internet functionalities to overcome hurdles in trade and adopt an approach that is not restricted geographically and can yield better opportunities for SMEs (McGowan et al. 2001). The use of e-CRM is not simply recording consumer data over the internet but could also be used to provide real time personalization for interaction with customers and managing strong relationship with them. E-CRM allows gathering of consumer data that could help SMEs in designing and developing products and services that serve customers better than their competitors. This way e-CRM assists businesses to set up exit barriers for consumers as suggested by Day and Hubbard (2003) and Chaston and Mangles (2003). There are great benefits from the strategic implementation of e-CRM in terms of lowering costs of doing business, increased level of efficiency in business processes and eventually to achieve competitive advantage (Smith 2000). However, at the same time it is viewed that the outcome of e-CRM could really be beneficial for SMEs that are operating in countries having high internet connectivity and integration of e-CRM for SMEs also depends upon the type of products and services offered by SMEs. However, the ability of SMEs to explore opportunities over the internet market is undeniably expanding (Boyle 2001). It is further understood that SMEs do not have resources to spare on testing out strategies for managing customer relationships as compared to larger organizations therefore e-CRM provides them with a centralized controlled way of dealing with different aspects of customer relationship management with relatively less use of resources. The integration of e-CRM into business strategy can allow SMEs to achieve higher product loyalty but at the same time they must be careful as the use of e-CRM can often lead to negative outcome because of perception of consumer of the lack of personalization from the approach SMEs may adopt through e-CRM (Lituchy and Rail, 2000). Further studies suggest that SMEs typically have an approach to deal with short term obstacles of managing customers’ relationship and they rely on tactical approach to the issues rather than adopting a strategic approach that is required for success of e-CRM (McCole and Ramsey 2004). McGowan and Durkin (2002) suggests that the implementation of e-CRM is not easy for SMEs as businesses need to establish trust and confidence amongst customers that could be a difficult proposition to be achieved over the internet as compared to face-to-face interactions. This could also create difficulties as interactions over the net lack personalization of communication that could affect customers’ perspective of the business relationship. Most of the literature available on the use of e-CRM by SMEs pertains to the studies carried out by various researchers in the developed economies. However, it is observed that SMEs are increasingly faced with challenges to establish and manage strong relationships with market participants including suppliers, customers, workers and other stakeholders and the extent of information available on developing a thorough understanding of issues related with e-CRM and its implications for SMEs is somewhat limited. The lack of literature is also observed by several researchers including Boyle (2001) and McGowan and Durkin (2002) in their studies of the role of e-CRM on SMEs business, sustainability and growth. The proposed research will attempt to bridge this gap by providing a detailed understanding of e-CRM and its role in increasing the efficiency and effectiveness of SMEs in developing countries. Research Methodology The proposed research methodology is considered to be qualitative research that is based on phenomenological paradigm and involves qualitative data collection and interpretation of findings based on the researchers own interpretative skills and knowledge (Ketchen & Bergh, 2004). The research will also use deductive approach (Saunders et al, 2007) that will allow generalization of findings from a particular set of companies to a large group of small and medium enterprises. Data Collection The data for the proposed research will be collected from both primary and secondary sources. For primary data a survey questionnaire will be designed for collection of responses from representatives of selected Indian companies (Trochim, 2006). The questionnaire will be designed in such a way that it covers different aspects of implementation of e-CRM and evaluate its possible effects on the companies’ business and their ability to respond to the requirements of their customers efficiently and effectively. Sampling For primary research five Indian SMEs from the automotive industry based in New Delhi will be selected. The selection of companies is not random and they will be contacted through the researcher’s personal contacts with the industry participants. However, prior to conducting the primary research ethics clearance will be obtained from the university. Analysis Since the proposed research methodology is based on the qualitative research therefore no statistical technique will be used to assess findings from the study. The responses to be collected from the primary research will be gathered and important findings will be drawn from similarities and differences in responses from five Indian SMEs. The researcher’s own interpretative skills and knowledge will play an important role in developing a case for e-CRM and its implications for SMEs operating in developing countries and assess its importance for efficient and effective management of customer relationship. The analysis will also bridge the gap between the proposed research and previous literature available on the subject topic that is primarily focused on data available from developed economies. This way the proposed study will be an excellent attempt by the researcher to extend the scope of study to emerging economies. Research Variables Categorical Variables: Dependent variable: Researcher’s own interpretative skills and knowledge related to the subject (Agarwal, 1983). Independent Variable: Time and cost of conducting the proposed research (Key, 1997). Continuous Variables: Dependent Variable: 1) The number of companies and respondents selected for the survey questionnaire 2) The possibility of biasness of responses and misunderstanding of questions inquired from respondents (Key, 1997). Timeline: Tasks Performing initial study and collecting relevant data for evaluating the study subject Collecting relevant literature review Making a choice between different research methodologies suitable for the research Preparing the research proposal Finalizing and submitting the research proposal Undertaking further investigation and carrying out the primary research Review of Chapter 1: Introduction Review of Chapter 2: Literature Review Review of Chapter 3: Research Methodology Review of Chapter 4: Findings & Analysis Review of Chapter 5: Conclusion Submission of First Draft Submission of Second Draft Submission of Final Report References Agarwal, R. D. (1983). Organization and Management. New Dehli: Tata Mc-Graw Hill. Boyle, A.B. (2001) The internet in industrial channels: its use in (and effects on) exchange relationships Journal of Business & Industrial Marketing 16 (6/7) 452 Chaston, I. and Mangles, T. (2003) Relationship marketing in online business-to-business markets: a pilot investigation of small UK manufacturing firms European Journal of Marketing 37 (5/6) 753 Day, S. G. and Hubbard, J. K. (2003) Customer relationships go digital Business Strategy Review 14 (1) 17-26 Ketchen, D. J., & Bergh, D. D. (2004). Research Methodology in Strategy and Management. New Jersey: Emerald Group Publishing. Key, J. P. (1997). Qualitative Research. Retrieved May 4, 2010, from Oklahoma State University: http://www.okstate.edu/ag/agedcm4h/academic/aged5980a/5980/newpage21.htm Khosrow-Pour, M. (2006). Emerging Trends and Challenges in Information Technology Management (Vol. 1). New Dehli: Idea Group Inc (IGI). Lituchy, T. R. and Rail, A. (2000) Bed and breakfasts, small inns, and the internet: the impact of technology on the globalization of small businesses Journal of International Marketing 8 (2) 86 McCole, P. and Ramsey, E. (2004) Internet-enabled technology in knowledge-intensive business services: a comparison of Northern Ireland, the Republic of Ireland and New Zealand Marketing Intelligence & Planning 22 (6/7) 761 McGowan, P. and Durkin, M. G. (2002) Towards an understanding of internet adoption at the marketing/entrepreneurship interface Journal of Marketing Management 18 (3/4) 361-77 McGowan, P., Durkin, M. G., Allen, L., Dougan, C. and Nixon, S. (2001) Developing competencies in the entrepreneurial small firm for use of the internet in the management of customer relationships” Journal of European Industrial Training 25 (2/4) 126 Saunders et al, M. (2007). Research Methods for Business Students. Essex: Pearson Education. Trochim, W. (2006). Types of Surveys. Retrieved May 4, 2010, from Available from: Research Methods Knowledge Base: http://www.socialresearchmethods.net/kb/survtype.php Read More