Customer Relationship Management at Ford - Essay Example

Customer Relationship Management at Ford Introduction Customer relationship management is one of the most important success factors for businesses. It is especially important for manufacturing concerns like Ford, because it helps them to generate customer loyalty and high lifetime purchase pattern. Considering that Ford manufacturers automobiles whose customer use cycle is pretty long, it needs to focus on its customer relations in order to retain customers over their lifetime hence making sure that repeat purchases occur. The report will focus on an interview with the customer relationship manager at Ford, in order to find out the issues at the automobile manufacturer regarding the customer relationship. The report will also discuss the solutions to the named problems and will explain in detail how the problems were resolved. Finally, a few suggestions will be made in order to improve the service. Case Discussion During the interview conducted there were several key findings about the nature of the business and the importance of customer relationships to Ford. According to the management the success or failure of our business depends upon the client problem solving and maintaining sound customer relationships. Ensuring customer satisfaction is the key principle for making the business a success because satisfied customers are the ones’ who will come again to buy the products, they are less receptive to the competitors advertisement and they will increase the credibility of the firm by viral marketing (Importance of Customer Satisfaction). On the other hand customer problems will cost the company in terms of lost sales; it will also hamper future purchases by the customers. And will cause a negative word of mouth behavior. Once a customer is dissatisfied and is lost to competition it becomes exceedingly difficult to get him back to the brand again. Customer retention is the key to a prosperous business and according to the Pareto’s Principle 80% of your business will come from the 20% of the customers. Therefore, it is important not only to retain customer but also to instill customer satisfaction. So Ford needs to address the customers’ issues and problems effectively and efficiently to make sure they don’t lose out their customers to the competition. As a result, the traditional philosophy that says customer is the king is still applicable to modern day business practices. Customer relations at ford are comprised to two different channels, namely end customers and dealers (Cisco). Dealers are also considered to be customers because they are one of the touch points the firm has with the end customer, if the dealers are satisfied they will stimulate sales according which in turn will contribute towards the profits. Hence, Ford aims to establish sound relations with their end customers as well as their dealers. The automobile giant tries hard to focus on their customers and for that they have dedicated teams responsible for customer relationship management. But there are still certain areas that need improvements in order to ensure that customers get the best service possible. A few flaws in the customer service at Ford are that they need to improve their customer and dealer experience so that it becomes easier and more fruitful for dealers and customers to interact with the company. At present customer are not satisfied with the level of service and the overall customer service experience. Similarly, Ford relies only on a few selected means of communications to contact their customers. In this modern era where technology has impacted lives enormously they need to come up with newer methods like Web 2.0 and social networking sites such as Facebook etc. This transition to alternate customer touch points will also help in reducing the costs associated with customer relationship management plus is it will provide a better experience for the customers. Trends in the US automobile industry The automotive industry has gone through an unprecedented change. Since companies are relying on shifting their manufacturing units offshore and are running towards cost cutting measures. The competition from worldwide automobile manufacturers like Toyota etc has increased and hence US automobile manufacturers face a lot of challenges (Schwarz, 2008). On the other hand, the environmental concerns of customers and the fluctuating global oil supplies have forced the manufacturers to innovate and venture into hybrid or bio fuels cars. Employment Outlook and purchasing patterns Since, the financial meltdown the employment rates are decreasing and people are finding it hard to retain their jobs. Therefore, since the country is facing high unemployment rates the consumer buying patterns have also changed (Global Foresight, Inc. 2006 Report on Industry Trends Automotive). Now the consumers are buying lesser luxury goods and focusing more on the necessities. Similarly, the gas guzzling vehicles are not that common amongst consumers they are now relying on more fuel efficient cars that will put a lesser burden on their pockets. Solutions In order to retain its customers and solve the customer relations problems Ford has relied on deploying the Cisco Internet Business Solutions Group (IBSG). The IBSG will help Ford to eliminate the problems by opening up new communication channels with clients and improving the customer relationship with the dealers and the end customers. IBSG will help achieve customer satisfaction because it has the expertise, knowledge of best practices, and proven methodologies for business relations with customers. The steps taken to ensure better customer service included building two websites one dedicated to customers while the other was dedicated to the dealers. The websites were designed to be more users friendly and hence more effective. They were also linked with the call center databases so that real time information could be available to the call centre representatives when a customer called regarding a query made over the Internet. The website also allowed the clients to send e mails directly to the customer relationship agent who was responsible for prioritizing them so that customers will not have to wait when they called for solutions. Another added feature was a click to call feature, which allowed clients to enter their number in to a screen and click the call button after which a customer relations agent would call them to ask the nature of their problem. The response time for this feature was 30 seconds. IBSG also improved the dealer website and provided facilities such as agent virtualization which gave Ford the flexibility to conduct a global self service website and with Intelligent Q&A feedback process. They also maintained blogs and chat rooms to maintain and record customer feedback. Conclusion It is evident that customer relations are very important for US automobile firms if they want to survive in the increasing global competition. To ensure that they live up to the challenge posed by the global manufacturers US based firms like Ford need to retain their customers. Customer retention is only possible by proving customers with good quality products combined with excellent after sales services and effective responses to customer queries. Ford was able to do this by implementing the Cisco’s IBSG and the success of the software and other initiatives can be proved by the words of Darryl Hazel, president, Ford Customer Service Division and Vice President, Ford Motor Company who feels that the relationship between Cisco and Ford has strengthened the relationship between Ford, its end customers and its dealers. Works Cited Cisco. (n.d.). Ford’s Innovative Customer Relations Programs Increase Owner Satisfaction and Promise 20 Percent Growth in Annual Savings. Retrieved May 16, 2010, from www.cisco.com: http://www.cisco.com/web/about/ac79/docs/wp/Ford_CS_1119.pdf Global Foresight, Inc. 2006 Report on Industry Trends Automotive. (n.d.). Retrieved May 16, 2010, from http://www.doe.mass.edu/cte/frameworks/trends_ov/auto.pdf Importance of Customer Satisfaction. (n.d.). Retrieved May 16, 2010, from http://www.allbusiness.com/marketing/direct-marketing/414324-1.html Schwarz, M. (2008). Trends in the Automotive Industry. Cisco White Paper , 2-3. Read More