Collaborative Customer Relationship Management

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Collaborative Customer

Relationship Management

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Alexander H. Kracklauer

D. Quinn Mills ´ Dirk Seifert

Editors

Collaborative Customer

Relationship Management

Taking CRM to the Next Level

With 99 Figures and 7 Tables

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Prof. Dr. Alexander H. Kracklauer Prof. D. Quinn Mills

Prof. Dr. Dirk Seifert Harvard Business School Soldiers Field

Boston, MA 02163 USA

[email protected] and [email protected] [email protected]

[email protected]

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Hardcover-Design: Erich Kirchner, Heidelberg Softcover reprint of the hardcover 1st edition 2004

ISBN 978-3-642-05529-4 ISBN 978-3-540-24710-4 (eBook) DOI 10.1007/978-3-540-24710-4

Originally published by Springer-Verlag Berlin Heidelberg New York in 2004 © Springer-Verlag Berlin Heidelberg 2004

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Preface of the Editors

Driven by rapidly changing business environments and more demanding consumers, many organizations are searching for new ways to achieve and retain a competi-tive advantage via customer intimacy and customer relationship management. In this context, new strategic frameworks and cooperative efforts with all participants along the value chain are needed to allow managers to synchronize their efforts with changes in shopping patterns of consumers. This book presents a new strate-gic framework that has already been tested successfully at global companies through a large empirical study. New management concepts like CPFR (Collabo-rative Forecasting and Replenishment), CRM (Customer Relationship Manage-ment), CM (Category Management) and Mass Customization are integrated in one holistic approach to jointly develop customer bonding and loyalty. Experts from companies like McKinsey, Procter & Gamble, Accenture, A.C. Nielsen as well as authors from renowned academic institutions like Harvard Business School and Technical University Munich offer valuable insights on how to redesign organiza-tions to meet future requirements of consumers.

Structure of the Book

After the introduction of the concept of customer management in part 1 of the book, Mercer Management consultants Eric Almquist and David Bovet together with Carla J. Heaton from Marsh & McLennan explain in chapter 2 what compa-nies have learned so far while implementing CRM and show key take-aways. Based on that, part 2 of the book explains how Collaborative Customer Manage-ment helps manufacturers and retailers to achieve joint success in the marketplace. Chapter 3 illustrates that Collaborative Customer Management is a further devel-opment of ECR on the demand side. Additionally, strategies and tools for Collabo-rative Customer Management are presented. A case study on Procter & Gamble clarifies the approach of Collaborative Customer Management. Chapter 4 explains the integration of Supply Chain Management and Customer Relationship Man-agement. It shows how logistics and information technology add value to the con-sumer while simultaneously reducing cost. In addition it shows what possibilities exist to increase co-operation along the supply chain in order to better meet con-sumer demand. A case study by JDA’s CTO, Scott Hines shows the way in which the integration of Customer Management and Supply Chain Management can lead to outstanding results. A study by Deloitte Consulting in chapter 5 reveals how customer satisfaction and profitability can be increased through customer man-agement and supply chain manman-agement. The study, conducted in 28 countries, shows that companies in digital loyalty networks, which integrate CRM and SCM

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VI Preface of the Editors

throughout the supply chain with modern IT are already realizing better earnings than comparable companies who have not.

The next part deals with the demand side of Collaborative Customer Relation-ship Management and looks more closely at CRM and Category Management. Chapter 6 and 7 show why cooperation in CRM makes sense and which results are realizable by using collaboration nets. The authors of the Technical University Munich show potentials and challenges of an individualization based approach and four models of an individualization based CCRM. AC Nielsen authors Mat-thias Groß and Jens Ohlig show in chapter 8, how market research institutes can help leverage the CM process and show the CM process in detail. Moreover, they demonstrate how Category Management can help to retain customers. Peter Bar-renstein and Stefan Tweraser of McKinsey establish in chapter 9 why CM is par-ticularly important now and offer guidelines for successful Category Management.

The next part of the book, part 4, looks into the relationship between CCRM and logistics. Collaborative Planning, Forecasting and Replenishment (CPFR), a new strategy for joint planning and supply management is introduced here via two contributions from industry experts. In chapter 10 Peter Hambuch of Procter & Gamble reveals how CPFR is employed by a large consumer goods manufacturer. In chapter 11, Georg Engler of Accenture discusses the progression from a pilot project to broad based use.

The fifth section of the book looks at future developments in CCRM. Chapter 12, written by A. H. Kracklauer, D. Q. Mills and D. Seifert together with P & G authors M. Leyk and S. Rübke deals with newest developments in the Category Manage-ment field and consequently talks about “New Ways of Category ManageManage-ment”. M. Großweischede of the Competence Center for Multi-Channel-Management of the University of Essen introduces CCRM in the Internet and customer driven assort-ments for e-retailers in chapter 13.

The sixth and final section of the book draws conclusions from the preceding chapters and offers the essential ‘take-aways’.

The book is to be viewed as a platform for the expression of the opinions of dif-ferent important players in the field: manufacturers, retailers, consulting compa-nies and IT-solutions providers. The opinions expressed by contributing authors do not necessarily reflect those of the editors. The articles distinguish themselves through different styles and approaches, offering the reader varying perspectives on Collaborative Customer Relationship Management.

Acknowledgements

The book would not have been possible without the help and the inspiration of many people and companies.

The editors would like to thank Accenture, JDA, and SAP AG, who sponsored our research.

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Preface of the Editors VII

Special thanks in particular to the contributing authors for sharing the knowl-edge and experience of their companies.

We would also like to thank the members of our research team. First of all we want to thank Anurag Mehndiratta, who gave us a lot of valuable insights based on his work at Siemens. Moreover, Alexander Adler, Mark Cicirelli, Kirstin Hornby, Julian Kurz, Carla Saraiva, Steffen Schneider and Michael Lark contrib-uted in an outstanding way to this volume. Heartfelt thanks also to those whose personal involvement facilitated intensive debate on many ideas contained in this volume: Fred Baumann, Claudia Beckers, Steffen Bundesmann, Richard Downs, Dr. Stephan Friedrich, Prof. Dr. Hans Hinterhuber, Dr. Heiner Olbrich, Dr. Olaf Passenheim, Prof. Dr. U. Jens Pätzmann, Silke Slootz, Jim Uchneat, Jürgen Wel-termann, Prof. Sean Willems and Prof. Dr. Michael Zerres.

And finally, our thanks to Prof. Michael Y. Yoshino and the Research Division of the Harvard Business School, who helped pave the way for the work presented here.

If you have questions, comments and criticisms regarding this book you may contact the editors via e-mail:

[email protected], [email protected], [email protected]

Boston, April 2003 Prof. Dr. Alexander Kracklauer Prof. D. Quinn Mills Prof. Dr. Dirk Seifert

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Collaborative Customer Relationship Management

Collaborative Customer

Relationship Management

Alexander H. Kracklauer

D. Quinn Mills ´ Dirk Seifert

Editors

Collaborative Customer

Relationship Management

Taking CRM to the Next Level

Preface of the Editors

Structure of the Book

Acknowledgements

Table of Contents