Global Journal on Technology

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Global Journal on

Technology

Issue 6 (2014) 32-36

Selected Paper of Global Conference on Computer Science, Software, Networks and Engineering (COMENG-2013)

The Evaluation Criteria for the Purchase of the CRM

Jan Němeček *, University of Hradec Králové, Faculty of Informatics and Management, Czech Republic. Suggested Citation:

Němeček, J. The Evaluation Criteria for the Purchase of the CRM, Global Journal on Technology [Online]. 2014, 06, pp 32-36. Available from: www.awer-center.org/pitcs

Received May 17, 2013; revised July 09, 2013; accepted September 17, 2013.

Abstract

The article deals with the part of the research “Business Requirements for Information Systems” where 208 companies participated. The research was done using questionnaire survey. The focus is on Customer Relationship Management (CRM), respectively selecting criteria according to which is the CRM chosen by the small and medium-size companies. The first part of the article describes the methodology and main aims and assumptions of the research. In the methodology is described how the research was created and the composition of the sample of companies. The second part of the article describes the analysis of the evaluation criteria for the purchase of the CRM for small and medium-size companies. Small and medium-sized companies have not as much money as large companies. This is one of the reasons why was as the most important criteria identified a price of the CRM. The other specific reasons are taken from the questionnaire responses. Obtained results are presented and described in tables and graphs. At the end of the article are listed the main results of the analysis.

Keywords: business strategy, CRM, customer relationship management, information technology.

* ADDRESS FOR CORRESPONDENCE: Jan Němeček, University of Hradec Králové, Faculty of Informatics and Management, Rokitanského 62, Hradec Králové, 500 03, Czech Republic, E-mail address:[email protected], [email protected] /

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1.Introduction

The Customer Relationship Management (CRM) is currently trend in the Czech Republic since the economic crisis in the year 2008. Managers of all kinds of companies (small, medium-size, large, huge) need to retaining existing customers, improve communications with customers, increase efficiency, increase product quality, identifying and predicting possible future demand and also to gain new customers and improve market competitiveness. For these needs is implementing CRM business strategy together with CRM IT solution very good decision. Especially during the economic crisis is CRM competitive advantage. Nowadays are a lot of CRM IT solutions. The managers can choose CRM on based on various criteria. This was one of the reasons why was prepared a questionnaire research “Business Requirements for Information Systems”. This research was focused on selected small and medium-size companies in the Czech Republic.

2.Selected Definitions of CRM

According to the analysis of available literature is not entirely uniform CRM definition. For example, Scott Fletcher defines CRM as "a set of ideas and enterprise business processes, which have a direct impact on addressing, contact and customer retention, in the areas of marketing, sales and service" [1]. According Schneiderman [2] is the CRM not only technology and information system, but also a business strategy focused on understanding our customers and based on anticipating the needs of current and future customers of the company. Österle *3] defines CRM as an alternative to increase turnover and profits of the company through the coordinated integration of all business contacts with its suppliers, business partners and customers.

3.The Research Methodology and Aims 3.1.The Research Methodology

This research was inspired by previous research by Hynek and Janeček *4] "Evaluation of the Benefits of Advanced Technologies" conducted in the years 2008-2009. This questionnaire research “Business Requirements for Information Systems” was conducted during the year 2013 and focused on selected small and medium-size companies in the Czech Republic. The questionnaire had three parts. The first part was focused on Financial Management. The second part was focused on using Customer Relationship Management in the companies. The third part was focused on using Cloud Computing technology. In each part were prepared response options and space for writing answers. All respondents could choose prepared answers or write your own. The research was made with cooperation with Datank, Ltd. which helps with collecting data. The questionnaire had on-line form and data was collecting anonymously through the web page.

3.2.The Aims of the Research

The main aim of CRM part of the research was mapping using CRM technology in the small and medium-size companies in all scopes of business (market sectors) classified by scale CZ-NACE [5]. The part of this research was focused on questions about evaluation criteria for purchase of the CRM in the small and medium-size companies. This paper is focused to analysis of obtain results. All results are analysed.

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4.The Results of the Analysis

4.1. Composition of the Sample of Companies

The sample has total of 208 small and medium-size companies in the Czech Republic which filled on-line questionnaire. All respondents could choose only one answer. The scopes of business of companies in this sample according to the classification scale CZ-NACE [5] are shown in the Figure 1.

Source: Own processing

Figure 1.: The Composition of the Sample of Companies by Scopes of Business

The four main scopes of business of companies in the sample are construction industry (20 %), wholesale and retail sale (16 %), manufacturing industry (13 %) and information technology and communication activities (6 %). The composition of the sample of companies by overall annual turnover is shown in the Table 1.

Table 1. The Composition of the Sample of Companies by Overall Annual Turnover Overall Annual Turnover Quantity Percentage

To 39 999 Euro 63 30.4 %

40 000 – 199 999 Euro 54 26.0 % 200 000 – 1 199 999 Euro 56 26.9 % 1 200 000 – 3 999 999 Euro 23 11.0 % 4 000 000 – 11 999 999 Euro 8 3.8 % 12 000 000 Euro and more 4 1.9 %

Source: Own processing

The most of the companies had overall annual turnover to 39 999 Euro (30.4 %), from 40 000 to 199 999 Euro (26.0 %) and from 200 000 to 1 199 999 Euro (26.9 %). It confirms the good targeting the questionnaires to the small and medium-sized companies.

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4.2. The Evaluation Criteria for the Purchase of the CRM

For finding the main evaluation criteria for purchase of the CRM IT solutions was in the questionnaire set the question “When it comes to choosing a CRM system, how important to you are the following evaluation criteria?”. All respondents could choose one or more relevant evaluation criterion or write your own. Nobody wrote own criterion. All respondents were choosing relevant criteria. The all results of all answers are for better overview shown in the Table 2.

Table 2. The Evaluation Criteria for the Purchase of the CRM When it comes to choosing a CRM system,

how important to you are the following evaluation criteria? Definitely not important Somewhat unimportant Somewhat important Definitely important I do not know

The price of CRM system 2,22% 13,33% 26,67% 55,56% 2,22%

The compatibility with existing IT systems within the enterprise*

2,22% 6,67% 20,00% 71,11%* 0,00%

The compatibility with IT systems suppliers 4,44% 46,67% 28,89% 20,00% 0,00% The clarity evaluating business cases* 0,00% 8,89% 22,22% 66,67%* 2,22% The speed of implementation CRM to the

company

0,00% 15,56% 48,89% 33,33% 2,22%

The mobility of CRM system (eg. operation on different mobile devices)

4,44% 13,33% 42,22% 33,33% 6,67%

The clarity of CRM system (user friendly)* 2,22% 2,22% 15,56% 77,78%* 2,22%

The support for teamwork 2,22% 2,22% 40,00% 51,11% 4,44%

The quality of evaluated data* 0,00% 2,22% 24,44% 73,33%* 0,00% The ways how to work with documents 0,00% 13,33% 42,22% 42,22% 2,22% The extensive possibilities of settings and

editing CRM system

0,00% 17,78% 42,22% 33,33% 6,67%

The service of supplier or provider of CRM 4,44% 4,44% 31,11% 53,33% 6,67% The possibility of implementing CRM

solution in the cloud (on-line on the external server provider)

6,67% 42,22% 20,00% 20,00% 11,11%

The possibility of implementing CRM solution in off-line mode (installation on the internal corporate server)

2,22% 28,89% 31,11% 26,67% 11,11%

The cost savings to the customer service 0,00% 11,11% 48,89% 37,78% 2,22% The measurable improvement in long-term

relationships with customers

0,00% 11,11% 28,89% 57,78% 2,22%

* Definitely most important evaluation criteria; Source: Own processing

The research showed that the four definitely most important evaluation criteria for the purchase of the CRM IT solutions are:

 The clarity of CRM system (user friendly - 77,78 %),

 The quality of evaluated data (73,33 %),

 The compatibility with existing IT systems within the enterprise (71,11 %),

 The clarity evaluating business cases (66,67 %).

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CRM solution in the cloud (on-line on the external server provider - 42,22 %). Interesting result is the price of CRM system. For small and medium-size companies the price of CRM system is not first main criterion but sixth definitely important criterion. It means that respondents expected more functionality than only cheap price of CRM. The interesting result is CRM in cloud too. Especially in the Czech Republic are providing cloud solutions one of the quick grow market segment. But Czech managers are very afraid about putting company’s important data about their customers to the CRM cloud solutions. One of the reasons is Czech legislative about protecting customer’s sensitive information. The other reason is that they do not trust the security cloud solutions.

5.Conclusion and Summary

According to the analysis of evaluation criteria for the purchase of the CRM IT solutions in the small and medium-size companies is very important user friendly of CRM. For CRM developers and providers can be recommended spending more time with the CRM users before, during and after the implementing CRM in the company.

Acknowledgements

Author thanks to the Faculty of Informatics and Management, University of Hradec Králové, Czech Republic for supporting the research by grant "ICT as a Tool of Effectiveness and Growth" in original "ICT jako nástroj efektivity a růstu", project number 8/2013, contract number 2108 and also thanks for non-financial support of this research.

References

[1] V. Kumar, & W. J. Reinartz, (2006). Customer Relationship Management-A Databased Approach, John Willey and Sons Inc., USA.

[2] N. Schneiderman, & A. Yih, (2001). The Emerging Face of Customer Relationship Management, Wedbush Morgan Securities.

*3+ H. Österle, & A. Muther, (1998). Electronic Customer Care – Neue Wege zum Kunden, Wirtschaftinformatik 40.

[4] J. Hynek, & V. Janeček, (2009). Evaluation of the Benefits of Advanced Technologies orig. Hodnocení přínosů vyspělých technologií, Hradec Králové: Gaudeamus.

[5+ Český statistický úřad (2011). Metodická příručka k NACE Rev 2. (CZ-NACE)”, *Online+, Retrieved June 10, 2013 from:

http://www.czso.cz/csu/klasifik.nsf/i/metodicka_prirucka_k_nace_rev_2_(cz_nace)/$File/metodicka_prir uck a_cz_nace_rev_2.pdf