WELINGKAR INSTITUTE OF MANAGEMENT DEVELOPMENT &

RESEARCH

Current Status of e-CRM in Indian Banking: - A Survey

By
Shrikant Zanwar
PGDM e-Biz 2013 15
TRIMESTER VI

SPECIALISATION: FINANCE
ROLL NO: 49

Under the Guidance of:

Prof. Prasannavadanan Thampi

PROJECT COMPLETION CERTIFICATE

This is to certify that project titled Current Status of e-CRM in Indian

Banking: - A Survey is successfully done by Mr. Shrikant Zanwar in
completefulfillment of his two years full time course Post Graduation Diploma in
Management recognized by AITEC through the Print. L. N. Welingkar Institute of
Management Development & Research, Matunga, Mumbai.

This project in general is done under my guidance.

___________________________
(Signature of Faculty Guide)

Name: ______________________

Date: ______________________

ACKNOWLEDGEMENT

This final year project has been a golden opportunity for learning and selfdevelopment. I consider myself very lucky and honored to have so many
wonderful people lead me through in completion of this project.
.
I wish to express my indebted gratitude and special thanks to Prof.
Prasannavadanan Thampi, who in spite of being extraordinarily busy with his
duties, took time out to hear, guide and keep me on the correct path. He helped all
the time and gave the right direction towards the completion of the project. His
advice is invaluable and will definitely help me in my long term goals.

My project was very well supported by Mrs. Suvarna Moghe and Mr. Ganesh
Devarushi who were always there for support during all the times of the project.

INDEX
Table of Contents

1. Abstract
2. Introduction
3. Literature Review
4. Profile of Banks
5. CRM in banks
6. Study Objective
7. Methodology
8. Data Analysis
9. Discussion
10.Conclusion
11.Reference
12.Annexure: Questionnaire

1. ABSTRACT
eCRM can help bank to manage customer interaction more effectively to maintain
competitiveness in present economy.Moreover anxiety is taken as a moderating variable that
moderates the relationship between E-CRM and customer satisfaction. For this 40 questionnaires
were distributed responses were obtained. The future research should comprise of factors that
can be used to evaluate the customer satisfaction. In addition the moderating impact of other
dispositional variables should be used to evaluate customer satisfaction.

2. INTRODUCTION
In recent years, the banking industry around the world has been undergoing a rapid
change. In India also, the wave of deregulation of early 1990s has created heightened
competition and greater risk for banks and other financial intermediaries. In the year 1969, 14
banks were nationalized and in the second phase of nationalization 6 banks were nationalized.
The top concern in the mind of every bank's CEO is increasing or at least maintaining the market
share in every line of business against the backdrop of heightened competition. With the entry of
new players and more resources, customers (both corporate and retail) have become more

discerning and not loyal to banks. This makes it imperative that banks provide best possible
products and services to satisfy customer. To face the challenge of retention of customers, there
have been active efforts in the banking circles to switch over to customer-centric business model.
The key success of such a model depends upon the way adopted by banks with respect to
customer data management and customer relationship management.
Over the years, Indian banks have expanded to cover a large geographic & functional
area to meet the developmental needs. They have been managing a world of information about
customers their personal information. They have a close relationship with their customers and a
good knowledge of their needs, requirements. Though this offers them a different advantage,
they face a basic problem. Customer-centricity also implies increasing investment in technology.
Overthe last decade, banks world-over have re-engineered their organizations to improve
efficiency and move customers to lower cost, automated channels, such as ATMs and net
banking. But this need not be the case. However, to maximize the value of this resource, our
banks need to upgrade their branches from transaction processing centers into customer-centric
service centers. This transformation would help them achieve bottom line business benefits by
retaining the most profitable customers. Branches could also be used to inform and educate
customers about other, easier channels, to advise on and sell new financial instruments like
customers loans, insurance, mutual fund products, etc. There is a growing realization among
Indian banks that it no longer pays to have a "transaction-based" operating model. They took
more efforts to develop a relationship-oriented model of operations focusing on customer centric
services. The biggest challenge our banks face today is to establish customer privacy without
which all other efforts towards operational excellence are meaningless. Banks are involved with
the nature of the product and nature of customer needs. Customer relationship management
(CRM) is all about Repeating.
It must be noted, however, that customer-centric banking also involves lots of risks. The
banking industry all over the world is being thrust into a wild new world of privacy issue. The
banks need to set up serious governance systems for privacy risk management. It must be
reminded that customer privacy issues threaten to compromise the use of information technology
which is at the very center of and customer relationship management. The serious issue for banks
is that they will not be able to secured customer privacy completely without undermining the
most exciting innovations in banking. These innovations promise lots of benefits, both for
consumers and providers. But to capture them, banks and their customers will have to make
some critical tradeoffs. When the stakes are so high, nothing can be left to chance, which is why
banks must immediately begin developing comprehensive approaches to the security issue.
Customer Relationship Management is the innovation of industry shifting and the level of
competiveness organizations have had to deal with in order to gain competitive advantage in the
market. In the last few decades we have seen a dramatic economic shift from manufacturing to
information and knowledge driven services (Ramaswani, Srivastava, & Bhargava, 2009). Such
shift has contributed to a corresponding increase in intangible assets like brand recognition.
CRM is tools of intermediaries which help companies succeed in the transition that we have had
from a production economy to a service one. According to Payne and Frow (2005) CRM is a

strategic approach whose ultimate goal is to create value through the development of the
relationships amongst key customers and customer segments; its purpose is to create long term
relationships between the organization and its customers. The technological advancements
occurring in the past decade have had an impact on CRM as well. While the innovation of CRM
was made possible to better assist customers, the internet and social media gave rise to Social
CRM and regardless of the level of involvement of the company in CRM; Social CRM is being
pushed towards organizations almost as a natural phenomenon which offers insights into the
customers wants and needs.

3. Literature Review
CRM is an interdisplinary subject; this cannot be studied in isolation. Before making any single
move towards improvement propositions, it is worthwhile to first understand and analyze the
current and future trends. The literature on Customer Relationship Management in the context of
the Banking Industry of developed countries points towards the wide use of all financial services
under one roof leading to relationship banking and CRM concept in a specific study on CRM
found that a customer becomes more profitable in the long run. Though the initial acquisition
cost exceeds gross margin but the subsequent retention costs are much lower which help in
increasing the profits. The Research findings of Technical Assistance Research Project state that

95% of customers do not complain and give opportunity to competitors. On the other hand, a
dissatisfied customer tells around 14 people about service failure, whereas the same customer
tells only around six others when he receives excellent service. This chapter highlights major
review developments related to CRM relevant for the study
Ernst & Young (1999, p. 34):
They observed that enterprises investing on CRM solutions predominantly focus on
technology. The challenge lies in combining people, processes and technologies while
implementing CRM Solutions.
Dr. S.P Rajgopalan (2000, p. 47):
In his article e banking in Indian scenario has defined the need of e-banking in Indian
context as it can help banks to reduce the cost of transaction and cost of administration and to
survive in competitive environment it is essential for banks to information technology and to able
to provide more better and efficient services .
Swift (2001, p.65):
He studied and found out CRM as a process aimed at collecting customer data, finding
profiles of customers and use the customer knowledge in specific marketing activities. CRM has
been seen as an IT-enabled business strategy focusing on developing and retaining customers
through increased scores on satisfaction and loyalty.
Bose (2002, p. 56):
He has outlined a CRM development plan based on the development life cycle approach
involving acquisition, analysis and use of knowledge about customers so as to sell more goods
and services and to do it more efficiently. An integration of technologies, working together, such
as data warehouse, website internet/extranet, phone support systems, accounting ,sales marketing
and sales has been called for by the author. The analytic functions desired have been proposed to
be fulfilled by separate systems such as decision support systems and expert systems.
Jain and Dhr (2003, p.685):
They studied the determinants of customer relationship management effectiveness in
India. They used in-depth interviews focused on behavioral dimensions of relationships. It was
found that customer relationship management emerged as a core business process for
maintaining and enhancing the competitive edge in modern business affairs. In the area of bank
services, the issue of customer relationship management holds much importance. Many a times,
it is the CRM that becomes the deciding factor while selection of services. Customer loyalty is
directly related to the CRM efforts made by the service sector companies.
Campbell (2003, p. 368); Rowley (2004); Minna and Aino (2005):
They studied that an analytical CRM system requires Knowledge Management (KM)
applications in CRM systems to improve the strategic efficiency of CRM through acquiring and
sharing knowledge about customers. The importance of interface between KM and CRM systems
in banks has been highlighted. They found out the criticality of this interface to understand and
operationalize this interface in parallel contexts of systems, people and processes. The same
author further suggests that customer data may be used as a platform for CRM systems for

communicating, creating loyalty, customer service, trust cultivation and relationship maintenance
and banks. The same may also act as a platform for KM processes in banks like knowledge
creation, sharing, dissemination and exploitation.
Reichlleld and Schefter(2000, p. 89)
The Customer Relationship Management is still in its pioneering stage. Customer relationship
management in electronic commerce (e-CRM) is one of the fastest growing management
techniques adopted by online enterprises.
Gilbert (2003, p. 47)
CRM has emerged due to the change in marketing environment. The link of the CRM with the
technology makes its more interesting to explore.
Kamakura et al (2005, p.33); Ngai, (2005, p.78).
Technological developments enable businesses to implement CRM systems that can create
practical mass customization marketing programs, based on one-to-one marketing techniques.
Peppers, Rogers, & Dorf, (1999, p.564); Reinartz & Kumar,(2000).
It is suggested by academics that the link between marketing and technology can help to build
and maintain long term, mutually beneficial interactions with large numbers of customers with
relatively lower costs
Dyche, (2001).
Within the framework of CRM, a number of channels exist for interacting with customers. One
of these channels is electronic, commonly known as e-commerce or e-business.
Companies should be able to integrate the online channels with the traditional customer touchpoints via e-CRM. It is the combination of hardware and software to capture and analyse the data
Heikki et al. (2002)
Through e-CRM companies try to identity and understand customers demographic pattern of
purchasing and other relevant information in order to create new business opportunities giving
importance to customers. However it is important for an organisation to define its business
objective and asses its current position with respect to its marketing environment before
implementing the e-CRM. An organisation must also align its existing strategy with the new
possibilities. The most widely tool of e-CRM in banking is the eBanking.
Alter, (2002).
The transformation from the traditional banking towards e-banking has been a leap change. The
evolution of electronic banking started from the use of automatic teller machines (ATM) and has
passed through telephone banking, direct bill payment, electronic fund transfer and the
revolutionary online banking.

Evolution of CRM (Customer Relationship Management)

CRM is defined according to Gummesson as CRM is the values and strategies of relationship
marketing with particular emphasis on customer relationships- turned into practical
application. Sternes definition of CRM is easier than Gummesson, CRM is the art of using
every piece of information that comes into your bank about each customer as means of tailoring
your communications with them on a one-to-one basis.
Customer Relationship Management is the establishment, development, maintenance and
utilization of long-term mutually valuable relationships between customers and the banks.
Successful customer relationship management focuses on understanding the needs and desires of
the consumers and is achieved by placing these needs at the heart of the business by integrating
them with the banks strategy, people, technology and business processes. Banks are involved
with the nature of the product and nature of customer needs. Customer relationship management
(CRM) is all about Repeating.
At the heart of a perfect CRM technique is the creation of mutual value for all the parties
involved in the business process. It is about creating and maintaining competitive advantage by
being the best at understanding, communicating, and delivering, and developing existing
consumers relationships in addition to creating and keeping new customers. So the concept of
product life cycle is giving way to the concept of customer life cycle focusing on the creation of
products and services that achieve the future need of the existing customers and creating
additional services that increase existing customer relationships beyond transactions. CRM is a
comprehensive approach for creating, maintaining and increase customer relationship. It
provides harmless co-ordination between customer service, marketing, information technology
and other customer related functions. It involves people, process and technology to maintain
relationships with all the customers.Today, in the competitive business world, management
realizes that customers are the core of a business and that a banks success depends on effectively
managing relationships with them. All objectives are focused to one single goal that is to make
customers happy because they are the ones who keepthe business running. Essentially, CRM
focuses on buildingsustainable customer and long-term relationships that add value for both the
bank and the customer. Besides widespread agreement that CRM can have a direct and indirect
impact on customer satisfaction, loyalty, sales and profit, the significance of CRM and the
factors that lead to its successful implementation is an area of widespread debate.

CRM is a business strategy depends upon relationship-oriented marketing that serves

marketing as a tool. CRM can be assumed to be a uniform effort for defining, maintaining, and
developing a customer relationship network and consolidation of achieving bilateral benefits for
all parties concerned through interactive and personalized communication and with an everincreasing value during a long period of time.

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CRM is a perfect business strategy to identify the banks most profitable customers and
prospects, and devotes time and attention to expanding account relationship with those customers
through individualised marketing, reprising, discretionary decision making, and customised
service through the various sales channels that the bank uses. Any banks seeking to adopt a
customer relationship model should consider six key business requirements (Chary &
Ramesh,2012), they are:
Create a customer-focused organisation and infrastructure.
Gaining accurate picture of customer categories.
Maximise rate of return on marketing campaigns..
Maximise the profitability of each customer relationship.
Understand how to attract and keep the best customers.
Assess the lifetime value of customers.
.
Strategy depends upon its ability to understand the needs of the customer and to integrate them
with the banks strategy, people and technology and business process. Financial services are in a
structural change whereby competition and customer demands are increasing.
CRM can provide various benefits to a bank, namely a distinctive and consistent customer
experience, clear identification of the organisation, technological and process-related
capabilities. The banking industry is much further along than other industries in recognising the
value of CRM and implementing decision support systems to support CRM. Though most of the
banks have already focused on tactical point solutions, theyre ready for a transition toward
strategic, enterprise-wide CRM initiatives that cross major business lines. Important decision
support systems for CRM enables to collect data about customer from every touch consolidate
this information into a single view of the customer, and use this information for customer
profiling, segmentation, cross-selling, up selling and retention efforts. As banks continue to seek
a unified understanding of customer relationships across diverse channels, the importance and
penetration of CRM is expected to grow like anything.
Customer Relationship Management (CRM) primarily caters to all interactions with the
customers or potential customers, across multiple touch points including the Internet, bank
branch, call center, field organization and other distribution channels.
Customer Relationship Management (CRM) can help banks in following ways:
1. Campaign Management Banks need to identify customers, tailor products and services to
meet their needs and sell these products to them. CRM achieves this through Campaign
Management by analyzing data from banks internal applications or by importing data from
external applications to evaluate customer profitability and designing comprehensive customer
profiles in terms of individual lifestyle preferences, income levels and other related criteria.
Based on these profiles, banks can identify the most lucrative customers and customer segments,
and execute targeted, personalized multi-channel marketing campaigns to reach these customers
and maximize the lifetime value of those relationships.

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2. Customer Information Consolidation Instead of customer information being stored in

product centric silos, (for e.g. separate databases of savings account & credit card customers),
with CRM the information is stored in a customer centric manner covering all the products of the
bank. CRM integrates various channels to deliver a host of services to customers, while aiding
the functioning of the bank.
3. Marketing Central repository for products, pricing and competitive information, as well as
internal training material, sales presentations, proposal templates and marketing collateral.
4. 360-degree view of company This means whoever the bank speaks to, irrespective of
whether the communication is from sales, finance or support, the bank is aware of the
interaction. Removal of inconsistencies of data makes the client interaction processes smooth
and efficient, thus leading to enhanced customer satisfaction.
5. Personalized sales home page CRM can provide a single view where Sales Mangers and
agents can get all the most up-to-date information in one place, including opportunity, account,
news, and expense report information. This would make sales decision fast and consistent.
6. Lead and Opportunity Management These enable organizations to effectively manage
leads and opportunities and track the leads through deal closure, the required follow-up and
interaction with the prospects.
7. Activity Management It helps managers to assign and track the activities of various
members. Thus improved transparency leads to improved efficiency.
8. Contact Center It enables customer service agent to provide uniform service across
multiple channels such as phone, Internet, email, Fax.
9. Operational Inefficiency Removal CRM can help in Strategy Formulation to eliminate
current operational inefficiencies. An effective CRM solution supports all channels of customer
interaction including telephone, fax, e-mail, the online portals, wireless devices, ATMs, and faceto-face contacts with bank personnel. It also links these customer touch points to an operations
center and connects the operations center with the relevant internal and external business
partners.
10. Enhanced productivity CRM can help in enhanced productivity of customers, partners
and employees.
11. CRM with Business Intelligence - Banks need to analyze the performance of customer
relationships, uncover trends in customer behavior, and understand the true business value of
their customers. CRM with business intelligence allows banks to assess customer segments,

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which help them calculate the net present value (NPV) of a customer segment over a given
period to derive customer lifetime value. Customers can be evaluated within a scoring
framework. Combining the behavior key figure and frequency to monetary acquisition analysis
with a marketing revenue quota can optimize acquisition costs and cut the number of inefficient
activities. With such knowledge, banks can efficiently allocate resources to the most profitable
customers and reengineer the unprofitable ones. Data warehousing solutions have been
implemented in Citibank, Reserve Bank of India, State Bank of India, IDBI, ICICI, Max-Touch,
ACC, National Stock Exchange and PepsiCo. And Business Intelligence players hope many
more will follow suit. A CRM system apart from improving front office operations and customer
servicing also helps in coping with many services that do not need manual intervention. These
are serviced by channels like IVR, Internet and ATM. Customers can get account information,
information on credit balance, issue instructions for drafts or even transact through these. At the
same time there may be a few customers who still prefer the traditional methods of banking.
Banks need to be flexible enough to continue to extend the personal touch that such customers
prefer.
Make changes internally before going for CRM: Many banks have spent a lot of money on
CRM, finding it easier to buy CRM technology than to make the major internal changes
necessary to really make CRM work for them. Unfortunately for these banks, the software has
often failed to deliver.
Customers Expectation toward CRM
Customer perceptions are till now positive in the context of the bank employing CRM as
compared to that not employing CRM due to following factors:
Reliability
Loyalty
Responsiveness
Empathy
Tangibles
Assurance
Satisfaction
Commitment

Evolution of e-CRM (e-Customer Relationship Management)

In simplest terms, e-CRM provides companies with a means to conduct interactive, personalized
and good communications with customers across both electronic and traditional channels. It
utilizes a complete view of the consumer to make decisions about messaging, offers, and channel
delivery. It synchronizes communications across otherwise separate the customer-facing systems.
It adheres to permission-based practices, respecting individuals preferences for how and whether
they wish to communicate with you. And it focuses on understanding how the economics of
customer relationships impact the business. Advocates of e-CRM realize that a comprehensive
understanding of customer activities, personalization, relevance, permission, timeliness, and
metrics are all a come to an end optimizing value between you and youre most important asset
your customers. While the definition above is simple, achieving e-CRM itself is difficult. For

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Global 2000 companies, evolving to e-CRM require process and organizational changes, a suite
of upgraded applications, and a non-trivial technical architecture to support both the e-CRM
process and the enterprise applications that automate the process. Mid-size companies may
benefit from less sophisticated, and easier to implement (and afford) hosted solutions, offered
through Application Service Providers. But regardless of the size of your firm, you have no
choice but to evolve to e-CRM quickly. Forrester Research expects e-CRM applications to
obsolete channel-specific CRM applications by 2002. McKinsey & Company notes that
capturing and effectively using customer profiles will determine winners and losers in
ecommerce development.
Electronic customer relationship management (e-CRM) is seen to arise from the consolidation of
traditional CRM with the e-business applications marketplace and has created a flurry of activity
among banks. e-CRM is the proverbial double-edged sword, presenting both opportunities and
challenges for banks considering its adoption and implementation. This explores the marketing
opportunities e-CRM creates for banks such as enhanced customer interactions and relationships
as well as personalisation options, all of which are potential sources of competitive advantage. It
also explores the challenges confronting banks implementing e-CRM such as managing an
online banking, data integration issues and information technology (IT) architecture challenges.
Directions for future research are also suggested-CRM describes the broad range of technologies
used to support a banks CRM strategy. It can be seen to arise from the consolidation of
traditionalCRM with the e-business applications marketplace.
Internet in recent times has emerged as one of the potent way to ease the access to banks. With
the innovative technologies provided by telecom providers banks have made it possible for
customers to pay bills at home with the use of internet. These include MTNL, BSES, and
AIRTEL etc. Understanding the importance of internet as a medium to reach the customers,
Indian private sector banks like ICICI Bank, HDFC Bank, Global Trust Bank andUTI Bank,
have taken the lead in e-banking. Foreign banks operating in India like Citibank Federal Bank,
HSBC Bank, Deutsche Bank and ABN Amro Bank, RBS arealso in the same practice.
Recently it has been seen that even the Indian public sector banks like SBI have begun the
internet enabled services for their customers.
UTI in connection Comet Max is looking to create a communication network for its customers.
The network is said to help in ATM servicing and intern management information system with
the 50 VSAT terminals at strategic locations.
As the banks need to collect, organise and use the information related to customers in a
systematic manner, e-CRM is a potent and efficient way to do that. It can help with developing
the accurate customer profiles to customize the offerings and improve the customer experience
by building healthy relationships. With some efficient data mining techniques, e-CRM will act as
a facilitator in converting the loads of information into useful customer profiles and touch points
hence improving the quality of data. An organisation must keep a customer centric approach in
implementing the e-CRM strategy to make it a profitable one and this will include the culture ,
process and people being integrated into the core framework. Banks need to understand that they
need to make a beginning. Start small, but start. Later they can learn and improve. Finally, it is
very important to communicate, train and measure all activities. The framework recommends
leadership and motivation driven by top management to optimise customer relationships on the
basis of customer information.
e-CRM features

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Regardless of banks objectives, an e-CRM solution must possess certain key characteristics:
It must be:
Driven by a data warehouse.
Focused on a multi-channel view of customer behaviour.
Based on consistent metrics to assess customer actions across channels.
Built to accommodate the new market dynamics that place the customer in control.
Structured to identify a customers profitability or profit potential, and to determine effective
investment allocation decisions accordingly.
Scalable to meet growth and performance needs.
Data warehouse driven
In an e-CRM solution, the data warehouse or customer data mart contains a consolidated and
comprehensive view of the customer. The warehouse provides the broadest possible profile of
the customer, needed to determine an appropriate course of action, the most effective offer to
make, and the best channel to deliver your pertinent message.
A multi-channel view
Organizations today have different methods for interacting with their customers. For example, a
bank might use one application to support its Website, another to support its call centre, another
to support email, another to support sales, another to support ATMs, and yetanother to support
direct mail and telemarketing. These applications, rarely, if ever, talk to each other, precluding
the sharing of information between channels and preventing meaningful cross-channel dialogue
with customers. For example, a call centre agent may not be oblivious to a complaint that a
customer registered that day through email, nor would the agent be aware of customer behaviour
on the Website.
Measurement driven
Today, many companies spend millions of dollars communicating with customers, but spend
little time and effort determining the effectiveness of those campaigns. e-CRM provides the
means to measure customer communications efforts. e-CRM is a continuous, iterative process. It
employs customer analytic tools to: project outcomes of customer communications initiatives;
capture results; attribute changes in customer behaviour to a particular communication; and
assess those results to improve subsequent customer interactions and returnoninvestment.
The disparities between customer touch-point systems can make the establishment of consistent
metrics difficult Thus, cross-channel coordination becomes important for establishing metrics
baseline. Effective measurement enables companies to target their customer investments in an
optimal fashion across all channels.
Scalable
E-CRM systems tend to quickly accumulate data, which is continuously manipulated by
analytical tools to refine marketing processes, messages and strategies. The difference between
Test environment and real-world application is often measured by scale and adaptability to
dynamically
changing
situations.
Off-the-shelf
solutions
may
implement
quickly,butwillcrumble from rigid and proprietary limitations that preclude the integration of

15

additional functions and the ability to scale to meet future growth and dynamic business
demands. Be careful
Steps to e-CRM Success
Many factors play a part in ensuring that the implementation any level of e-CRM is successful.
One obvious way it could be measured is by the ability for the system to add value to the existing
business. There are four suggested implementation steps that affect the viability of a project like
this:
Developing customer-centric strategies
Redesigning workflow management systems
Re-engineering work processes
Supporting with the right technology

4. Profile of Banks
1) Public Sector Banks
SBI
The Bank is actively involved since 1973 in non-profit activity called Community
Services Banking. All branches and administrative offices throughout the country sponsor and
participate in large number of welfare activities and social causes. Their business is more than
banking because they touch the lives of people anywhere in many ways. Their commitment to
nation-building is complete & comprehensive.
SBI KEY POINTS

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Indias largest Commercial Banking Group, consisting of SBI and 21 Subsidiaries, 6

Joint Ventures and 7 Associates
Rated AAA by Crisil (a Standard and Poor company) indicating highest safety
Maintaining a CAR of ~12% consistently
Independent Risk Governance structure & integrated risk management of credit,
market and operational risks
High levels of corporate governance Board driven decision making
Strong internal and external audit systems Audit committee of the Board consists
of highly qualified and independent directors
New initiatives in Pension Fund, Infrastructure Fund, Point of Sale and General
Insurance in partnership with large international players
Strong record of corporate social responsibility (CSR) activities

PNB
Established in 1895 at Lahore, undivided India, Punjab National Bank (PNB) has the
distinction of being the first Indian bank to have been started solely with Indian capital. The bank
was nationalized in July 1969 along with 13 other banks. From its modest beginning, the bank
has grown in size and stature to become a front-line banking institution in India at present.
Its presence virtually in all the important centers of the country, Punjab National Bank
offers a wide variety of banking services which include corporate and personal banking,
industrial finance, agricultural finance, financing of trade and international banking. Among the
clients of the Bank are Indian conglomerates, medium and small industrial units, exporters, nonresident Indians and multinational companies. The large presence and vast resource base have
helped the Bank to build strong links with trade and industry. Bank has Rupee Drawing
Arrangements with 15 exchange companies in the Gulf and one in Singapore.

2) Private Sector Banks

HDFC
HDFC Bank's mission is to be a World-Class Indian Bank. The objective is to build
sound. Customer franchises across distinct businesses so as to be the preferred provider of
banking services for target retail and wholesale customer segments, and to achieve healthy
growth in profitability, consistent with the bank's risk appetite. The bank is committed to
maintain the highest level of ethical standards, professional integrity, corporate governance and
regulatory Compliance. HDFC Bank's business philosophy is based on four core values
Operational Excellence, Customer Focus, Product Leadership and People. Key Services are as
follows:

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Funded Services
Non Funded Services
Specialized Services
Value Added Services

ICICI
In October 2001, the Boards of Directors of ICICI and ICICI Bank approved the merger
of ICICIand two of its wholly-owned retail finance subsidiaries, ICICI Personal Financial
Services Limited and ICICI Capital Services Limited, with ICICI Bank. ICICI Group offers a
wide range of banking products and financial services to corporate and retail customers through a
variety of delivery channels and through its specialized group companies, subsidiaries and
affiliates in the areas of personal banking, investment banking, life and general insurance,
venture capital and asset management. With a strong customer focus, the ICICI Group
Companies have maintained and enhanced their leadership position in their respective sectors.
The Bank currently has subsidiaries in the United Kingdom, Russia and Canada, branches in
Singapore, Bahrain, Hong Kong, Sri Lanka and Dubai International Finance Centre and
representative offices in the United States, United Arab Emirates, China, South Africa,
Bangladesh, Thailand, Malaysia and Indonesia. ICICI emerges as the major source of foreign
currency loans to Indian industry.

5. CRM Practices in Bank

CRM in ICICI Bank
The bank has successfully leveraged the power of Finacle and has deployed the solution
in the areas of core banking, consumer e-banking, corporate e-banking and CRM. With Finacle,
ICICI Bank has also gained the flexibility to easily develop new products targeted at specific
segments such as ICICI Bank Young Stars- a product targeting children, Women's Account
addressing working women and Bank campus targeting students.
The CRM initiatives in Indias ICICI Bank hold together its compelling story of growth.
Its growth in customer base, channels, and product and service offerings. The ICICI bank is one
of the private sector bank which is providing the customer value added services. They are not

18

only able to satisfy the customer but they are successful in building a never-ending relationship
with the customer. They are able to retain them and carry business with them to benefit both the
organization and the customer. Customer preferences and needs are very well understood by this
bank. With the help of technology they are able to develop brand equity in the market and
differentiate themselves from the competitors.
The group prefers to call it a "clicks and bricks strategy that provides multiple access
points to its customers. For its traditional customers there are the lean and mean brick and mortar
branches propped by ATMs, call centers and direct selling agents. Internet banking and WAP
enabled services take care of the Supply and technology savvy professionals of today. The rise in
Internet banking customers is a result of the Infinity, Internet banking facility launched by the
bank. The facility, initially made available to NRIs and later to resident Indians permits online
opening of accounts, bills payment, account information.
Call Centers
The ability to serve across all product categories from a single location has enabled the
bank to provide a level of service qualitatively superior to its competitors, and this is offered as a
complementary extension of the branch capabilities. Even the branches are moving very rapidly
towards offering seamless service to all the customers. The relationship between the branches
and the call center is very good, and the branches are discovering how to focus their efforts on
more rewarding service relationships. ICICI has understood the importance of customer service
over the phone, but it was only fairly recently that they began the task of consolidating their
resources on customer service and customer relationship enhancement. The bank takes people
who are first class graduates with a lot of yearning to learn. Following a selection process that
includes telephone, personality and literacy tests, there is a post recruitment process embracing a
continuous learning program.
ICICI appreciated early on that by centralizing their service infrastructure, and
centralizing their service expertise, they created a new level of service for customers. The call
center has played a leading role in transforming the banks value proposition for its customers:
The call center also provides an opportunity to shift the qualitative nature of the relationship
between bank and customer to a new level. Much of the extra leverage with customers that the
call center brings is tactical. A customer is a lot more receptive to up selling and cross selling
when theyre phoning ICICI. The humble call center is ICICI Banks means of shifting away
from a market share based product-as-commodity mindset, to those stresses the importance of
deepening exiting customer relationship.
ICICI used to spend a lot of energy trying to make sales. Now their emphasis has
changed they spend their energy to get to know the customer better. It is when a customer feels
comfortable with the relationship they have with ICICI that they are likely to deepen their
commercial relationship with them. The call center is there new tool to getting to know the
customer better. The speed of the shift away from the branch as the primary means of interacting
with the bank shows the receptiveness of Indian consumer behavior to the use of new channels.
The technology usage is far higher in a call center compared with any other environment. The
call center is a cheaper channel than the branch, and often it is more convenient for the customer.
This convenience can be supported by technology to provide a higher level of service than was
possible previously. All the products and process are unified in the single call center allowing

19

the customer to get a seamless service. So ICICI is therefore able to truly take a customer centric
customer view. ICICI is able to get a customer who has been rejected from taking a credit card;
they immediately offer a debit card.
E- Marketing
The e-initiatives of the ICICI group have not been limited to customer servicing. The marketing
activities for its various products are also taking the online route. In April 2000, through tie-ups
with Orange and Airtel, ICICI started offering limited WAP based services for customers on the
move. A month later, on its way towards a full-fledged online mobile commerce service, the
company commenced offering services like balance updating, request for cheque book, details of
last 5 transactions, request for statement etc. Corresponding services are also available for the
banks credit card customers. On the anvil are personal banking services, payment services for
utilities, travel and ticketing information etc
Modus Operandi
The group has leveraged on a number of tie-ups to come up with its various offerings.
For its Internet banking offering the ICICI Bank uses Infinity from Infosys, for its credit card
business it uses Vision Plus from PaySys, USA. For WAP services the tie-up with cellular service
providers Orange and Airtel helps reach out to these users, while the WAP technology is being
implemented by the in-house ICICI Infotech Services. To leverage the Net for its marketing
initiatives, ICICI Bank and Satyam Infoway have jointly set up a ".COM" company to promote
banking products on the Net. The bank has also entered into agreements with leading corporates
like BPL, Rediff.com, Usha Martin and Tata Communications for B-to-C solutions in a bid to
further strengthen its Internet banking product offering and services Payment systems are
perhaps the bane of any financial services company looking to move online. Security and privacy
are issues that every bank looking to move online is grappling with. The ICICI Group has come
up with its own answer to the problem. ICICI joined hands with a consortium led by Compaq to
take the lead in offering a solution to the Indian e-commerce community. This consortium offers
a B2B and B2C e-commerce payment gateway within India. The B2C payment gateway will
help the Internet shopper, the web merchant and the banks to engage in e-commerce, while the
B2B payment gateway will facilitate virtual transactions in the corporate world. CRM has been
envisioned by the bank to support its goals in sales, customer service, and analytics. Already,
about 30.40% of the banks home loans are cross-sold to existing customers. Similar ratios have
also been reported in the sale of insurance policies. Ratios of about 50.60% have been seen out
of the credit cards and personal loans business. The banks stated intention is to take these ratios
to as high as 60.75%. ICICI Bank states that these high levels of relationship maximization are
made possible by how its CRM system is able to "know and understand the customer better,
which customer is most suitable for what kind of product and at what point in time.

CRM Approaches
20

CRM, according to ICICI consists of following approaches:

[A] GETTING PERSONALIZED INFORMATION ON CUSTOMERS
The bank collects all the information about the customers for processing. ICICI bank has
mainly 4 service offerings viz: loan account, saving account, current account and fixed deposits.
Moreover, the bank has many customers in each category. So, they collect the data on one server
and thus the company gets the personalized information on each customer by asking them to fill
the information in customer application form.
[B] WHAT IS THE VALUE OF THE RELATIONSHIP?
After the collection of the personalized information on every customer, the department
checks out the value of the relationship with each and every customer. Later, they decide how to
approach the customer for knowing what his needs and wants are? After this is done, the
company offers him the customized product.
[C] CUSTOMIZED OFFERINGS TO THE CUSTOMER
The step which comes after deciding the value of the customer is that the company offers
the person the customized product. Moreover, they also practice a concept called cross- selling
over here. Cross selling refers to offering another product from the service offering of the bank
to the customer which he has not gone for.
[D] CONVERTING A PROSPECTIVE CUSTOMER INTO A TRUE CUSTOMER.
The last approach of CRM according to ICICI bank is that they try to convert the
prospective customer into a true customer. Right from the moment the inquiry comes, they
follow- up the customer and then make him to come to the bank occasionally and then regularly.
The processes for delivering CRM-The tools and the processes are as follow:
Customer application form
Centralized software where the whole data is collected.
Wide range of offering
Cross selling and
Feedback forms

Different Channels for Accessing Services:

Bank Branch
We can find a host of ICICI retail products at our widespread Bank Branch network-Bank
Accounts, Credit and Debit cards, Bonds, Demat Accounts, Loans against Shares, etc.
ATM Network
Make balance enquiries

21

Make cash withdrawals

Free access to all ATMs
Payee name available on the Mini statement.
Mini statement shows last 10 transactions
Ledger Balance available in Mini statement.
Phone Banking
24 hour manned Customer Care Center
Interactive Voice Response (IVR) facility available
Bill pay requests
Stop payment request
Balance enquiries
Give standing instructions for payments
Open a Fixed Deposit
Dial a draft
Internet Banking
Payment of Utility Bills-electricity, phone etc.
Online Railway ticket booking
3-in-1 Demat Account
Inter Bank funds transfer (available in select cities)
Third party transfer
Mobile Banking
ICICI bank mobile banking enables us to bank while being on the move.ICICI bank
mobile banking can be divided into two broad categories of facilities:
Alert facility: ICICI bank mobile banking alerts facility keeps us informed about the significant
transactions in your accounts. It keeps us updated wherever we go.
Request facility: ICICI bank mobile banking requests facility enables us to query for our
account balance.
INSTA Banking
ICICI Banks Insta Banking enables us to conduct banking transactions anytime from
anywhere. You can avail of this anywhere-Anytime banking service through our 24-hour
channels like ATM, Internet Banking, Instant Voice Response (IVR) Banking and Mobile
Banking, and from 8 a.m. to 8 p.m. These unique and user-friendly channels have brought
banking services to your fingertips. From balance enquiry to checking cheque status to ordering
a new cheque book, you can communicate with ICICI Bank from the comfort of your home or in
the middle of a busy day at the office.

22

CRM in HDFC Bank

HDFC Bank is making all possibilities come true for its customers. The bank offers
targeted messaging and other customized services using NCRs 'Aptra eMarketing' software. The
bank runs one to-one (customized) and one-to-all targeted messaging via all self-service channels
like the ATM, mobile banking and Internet banking. Most banks do not have clean data of the
customer with regards to residential address and other details. This implementation helps HDFC
Bank with a more thorough analysis of the change in customer demographics and thus, plans
their campaigns better after being equipped with a thorough data repository in the data
warehouse Services
Along with targeted messaging, the bank is also offering fast ATM services. HDFC Bank
has launched favorite transaction that allows the customer to set a particular amount for
withdrawal so that every time he visits the ATM he will not be accessing the same screens. This
has reduced the number of screens the customer must access while using the ATM machine for
withdrawing cash. Till now, the customer had to access 9 screens, which has now been reduced
to five screens, which has in turn resulted in a reduction of 40 percent in the time taken to
complete a transaction.They have been powered by the data warehousing, data mining, modeling
and analytics abilities and have structured data in the CRM to implement this software. The
major benefits from the implementation is saving about 40 percent of the transaction time at the
ATMs, ability to personalize communication via self-service channels enabling active
engagement with the customer, which further enhances the ability of the CRM for analytics.
HDFC has revamped its corporate website in line with its communication philosophy.
The new improved, interactive, and user-friendly website is in sync with its need-based
communication strategy of helping individuals through their decision of selecting the right plans
that fit their needs.

Protection: Need for a sound income protection in case of unfortunate demise of an

individual
Investment: Need to ensure long-term real growth of an individuals money
Saving: Need to save for the milestones and protect an individuals savings too
Retirement: Need to save for a comfortable life post retirement

The new improved website leverages to educate customers in choosing the right. The
website is designed to provide an enhanced user experience to our existing as well as prospective
customers through simple navigation, faster access, and rich content and enhanced utility as a
service delivery tool. The objective of their new website is to educate customers right from the
process of identifying their needs, to the final process of select the plan that fits their needs, the
website features an elaborate and exclusive knowledge section designed to help a customer.

The other salient features of the website are:

Caters to all types of Internet users - advanced, moderate and new users

23

Faster and convenient navigation (e.g. no need to use 'back page button;' access to relevant
and important links available on every web page)
Key information at your fingertips. e.g. structured flow of key product information and their
features
Enhanced interactivity through user interaction and involvement (tools and calculators)
Modular structure making the website 'future ready' with flexibility to accommodate
restructuring and additional content in future
Uses flash and other advanced software to provide a better surfing experience to the user, but
through its intelligence moves to a classic mode if the user does not have the requisite
software to view the same.
Compatible with all browser s i.e. Internet Explorer 6 and above, Firefox Mozilla, Safari,
Opera and Google Chrome

For HDFC, the CRM activities span three segments: Back-office, which enables all
transactions. For instance, a transfer of funds will involve recording the transfer request,
debiting and crediting the account appropriately and the transformation by telex or demand draft.
The back office enables the core activities of banking transactions. Distribution of the bank's
products and services in the market. That is, enabling customer interaction through the
Internet, ATMs, the mobile phone.HDFC's corporate customers need not visit the bank for many
of their transactions either. PC-based corporate banking lets authorized personnel in corporates
open letters of credit or pays suppliers and integrates the transaction with the ERP system. The
third sort of automation enables the business intelligence and CRM aspects of a bank's business.
HDFC Bank can analyze channel profitability. Say, determine which type of customer access
which channel the most, and evaluate the cost-benefits of offering a service to customers. For
cash management, they use a package from a Pune company called Cashes. There Depository
systems run on software provided by Mumbai-based Kalpataru. For loans, that uses Nucleus
Software. To provide round-the-clock service and support to its customers, HDFC Bank has
Unix-based systems from Sun Microsystems as hosts for its banking software. It is in the process
of moving the application to a mainframe-class UNIX machine (the E10000 from Sun) .Many
other systems run on Intel based Compaq or IBM hardware with Microsoft NT or Windows 2000
as the Operating platform. The systems are run on a centralized basis with the branches accessing
them via telecommunication lines (leased lines from the DoT). All departments within the
organization were automated simultaneously. They work on a centralized database, the addition
of new branches and new cities made very little impact on the day-to-day operations of the other
existing branches. Every server at HDFC Bank had its own direct attached storage that led to
distributed storage upgrades and inefficient use of storage. The storage sub-systems were not
highly available and resilient. Thus, to provide scalable, reliable storage systems, and a SAN
environment for all their applications, HDFC Bank opted for a solution from Hitachi Data
Systems. Playing in a dynamic market, where there is a constant need to innovate and stay ahead
of competition, HDFC Bank's objective is to build sound customer franchises across distinct
businesses, so as to become the preferred provider of banking services for target retail and
wholesale customer segments.

CRM in SBI
24

The need for system automation became critical at SBI. The challenge was to meet the
demanding service and fulfillment levels of the growing. SBI was on the lookout for a
technology solution that was easy to implement, cost-effective and robust to expand its presence
in the insurance sector and achieve a higher degree of service differentiation. Although the
organization had a centralized system, most of the work was done manually. they had a
client/server architecture in place. But it was not integrated with the legacy systems.
Early on, the top management realized that technology was a crucial driver for product
and service delivery. Although using the extensive SBI group platform for cross-selling products
and services was a viable option, reaching and engaging the customer cost effectively required a
technology backbone. Earlier, they had little enterprise software to support its business and the
processes were carried out in an ad hoc manner.
There were hiccups as various centers had problems connecting to the CRM portal, which
have been solved. They are using multiple types of connectivity, leased lines that terminate at the
central data center in Mumbai, broadband connections, dial-up connections, telephone lines, etc.
The type of connectivity depends on the number of users in that particular branch and the kind of
work being done there. They have their mail server and other functionalities on the portal too.
Technology
The development tool, Web Logic Workshop, is Java-based, allowing people at SBI to develop
and customize applications at a faster pace. Applications running on the system permit the
management of content, merchandise and campaign-related details. The company has even
moved its internal applications to the portal. Thus, even when a staff member is working
internally, he is working with an interface of a browser/portal. What used to be on a client/server
environment is now on the portal.
Functions like cash management, proposal details and issuing policies all happen on the
portal. Having deployed Web Logic, SBI is able to run its cycle-all its processes right from
claims processing to CRM-on the portal. Some features of the system are load balancing,
effective code deployment and clustering support (24x7). Plans are afoot to use the portal for
providing self service to customers, partners and employees. One can just come in, log on to the
portal, and access any kind of information.
SBI implemented the system in a different manner. With this initiative, SBI has derived
quite a few benefits. For instance, it has been able to reduce the Turn Around Time (TAT).
Because of this initiative they could spot a few processes that would otherwise never be
realized. They have outsourced some routine work which was done centrally and was manual.
Now, irrespective of the location of the work, its done through the portal and they are able to
manage it better.
Saving time and money
Process improvements are evident. All of this happened with minimal system changes without
adding to the existing infrastructure The solution has also brought down by 50 percent the time
taken for specific processes like cash management. With a view to understanding the data quality
gaps and to develop a road map to closing them, SBI engaged Spectrum Business Support Ltd.s
Data fix Solutions team (now Data fix Technologies Pvt. Ltd.) to undertake a Data Quality Study
and Audit (DQ Audit).

25

Data Quality Consulting and Audit.

SBI is equipped to develop a blue-print for their Customer Quality Initiatives to create
long-term competitive advantage. State Bank of India (SBI), Indias largest financial services
conglomerate has contracted to implement Anti Money Laundering (AML) software AMLOCK
from 3i Infotech Ltd .it helps the bank in managing its government clients better. Cash@WillTM
helps SBI improve revenue, maximize profits, optimize costs, and establish efficient
management systems to accelerate growth.SBI is now using Nucleus Softwares Cash@WillTM
for Drafts, Income Tax Refund Orders (ITRO), Multi City Cheque (MCC) and Collections
services. The implementation was done in a phased manner where Payments and Collections
modules implemented initially were subsequently replaced by the newer version of
Cash@WillTM. Nucleus' Cash@WillTM will power the cash management product of State Bank
of India. It supports the bank in handling of government business like ITRO, SBI rights issue..
Nucleus Cash Management Solution Cash@WillTM built on new generation technologies of
Oracle empowers banks to offer their corporate customers optimized cash management services,
dramatically improving funds collection and inflow forecasting, payment dispatch and funds
utilization. It provides anytime, anywhere access to quality real-time consolidated information
and seamlessly supports multibank, multi-currency, multi-lingual transactions, ensuring smooth
flow of information and cash.

CRM with PNB

PNB chose Spectrum Business Support's Insight solutions (now part of Insight Technologies Pvt.
Ltd.) to provide the Data-cleansing and DE duplication solution for the first 4.3 million records
from branches. The following tasks were done by the Insight team, using Scrubby for Datacleansing and Decuple for Data DE duplication:
Data Cleansing and DE duplication of Migrated Data.
Generating exception reports of bad quality data based on various data quality
dimensions like invalidity, inaccuracy, missing values, precision etc.
Developing onscreen validation routines which could be used by the Branches.
Measuring success of validation and incorporating corrections back into the system.
Data Deduplication by identifying Unique Individuals and Households.
Generating various Customer segmentation reports which could be used by PNB's think
tank.
The following key customer discoveries were part of the analysis:
- Top 20% of customers.
- Geographical and Demographic segmentation.
- Data Quality Analysis.
- Loyalty scores based on house holding.
The visionary zeal and the futuristic view of the Banks top management in the year
2000-2001 incubated the idea of introduction of a Centralized Banking solution. The bold and
innovative thought culminated into the CBS architecture with Finacle application on Oracle
Database and Sun hardware platform with Solaris Operating System. In 2001-2002, PNB
embarked upon a transformation journey unparalleled in the country in terms of scale and

26

technology. The bank became the first public sector bank in India to opt for a new generation
core banking platform Finacle from Infosys. Since then, Finacle has enabled the bank to
consolidate and centralize its operations, improving branch efficiency and productivity per
employee. Consolidation has also resulted in reduction of revenue leakage and cost, while
increasing ease of technical support and maintenance at branches. With Finacles agile and future
proof technology, the bank today has over 22,500 concurrent users. The solutions scalability has
also enabled the banks scalability to be the best in the country with the number of peak
transactions at 3.5 million. Finacle core banking platform also provides the bank with
exceptional agility for product innovation and improved flexibility of operations. With seamless
integration of delivery channels such as ATM and internet banking solutions, PNB is able to
provide 24X7 services to customers at a reduced transaction cost. Sun SPARC enterprise M
series and energy efficient Chip Multi-Threading (CMT) systems running the Solaris Operating
System delivered higher performance and scalability, enabling PNBs architecture to scale
seamlessly. Periodic consolidation of servers and storage by Sun Professional Services also
delivered important benefits optimizing compute and storage utilization, reducing power,
cooling and space costs significantly over a period of time. Sun technologies also ensured
continuous availability of the banking platform with the Disaster Recovery Site established by
the bank and as part of test drills, the Bank has successfully operated out of its alternative
datacenter (DRS). PNBs choice of the Oracle Database has provided the banks CRM
infrastructure with robustness, management features, security and scalability as well as
performance requirements to service 3.5 million transactions and 22500 concurrent users a
significant achievement in the Indian banking industry

6. Study Objective
To study the present state of customer relationship management in Public and
Private sector banks, identifying the important aspects of CRM, the customer view point on the
existing e-CRM, figuring out existing gaps present in the system and trying to figure out
different ways to improve e-CRM in public and private sector banks

27

7. Methodology
The purpose of methodology is to define a systematic approach to identify and answer research
questions with the help of a methodical collection and analysis of data. This research started with
a collection of secondary data from various literatures for the purpose of conducting a literature
review.
However, due to the nature of this study, obtaining primary data was critical for the success of
this research and a qualitative approach was taken for primary data collection. An empirical
research method was adopted to test e-CRM method.

28

Secondary Research and data:

Secondary data was collected as part of this research to provide background information related
to the study area. Collection of secondary data also provided a better insight to various
theoretical frameworks and models already existing in the subject area and provided a solid
foundation for designing in-depth interviews that were required to collect primary data.
To cover a wide spectrum of views and to achieve an unbiased overview of the subject area, most
of the relevant data collected through the secondary research method were used in literature
review. This detailed review of literature related to e-CRM provided a proper understanding of
the earlier work conducted in this broad area and raised research questions regarding the
technique for e-CRM. Literature review also provided information about specific issues, which
were come forward while using e-CRM
Primary Research:
Collection of primary data through the qualitative research method was vital to the success of
this research. This is mainly because the aim of this research is to identify whether the
transformational effects of e-CRM method predicted in literature were actually possible in a
practical context. It is also worth noticing the fact that existing academic research related to eCRM does not provide a clear data.

8. Data Analysis
Sampling
There are four banks, which have applied e-CRM systems to their customer service in Mumbai
recently: SBI, PNB, HDFC, ICICI Questionnaires were distributed to 40 e-CRM experienced
customers of these banks. We received 75% usable responses for the study.
These four banks have acted internationally by issuing financial products such as global
exquisite articles, international stock funds, and European market funds, etc. This research datacollection was designed to use these sample banks and then analysed these to build the
theoretical relationship. The research results could be highly expected toward generalization

29

because the new extension theory could contribute and apply to the mostly banking systems.
These banks also issue many diversified products, including: traditional financial merchandise
such as stocks, bonds, deposits, and financial bills, etc.; popular financial merchandise such as
real estate investment trusts (REITS), cash cards, and credit cards, etc.; and new financial
merchandise such as high-tech industry funds, emerging market stocks, and global exquisite
articles, etc. Data from these sample banks were used to show how an e-CRM service plays an
important role in the marketing integration process. Specifically, e-CRM raises the level of
seller-buyer transaction satisfaction when sellers/banks successfully promote their financial
merchandise to buyers/customers, because sellers could use e-CRM service to understand the
preferences and needs of the customers.

Age

Fig 1

20-30

15

37.5%

30-40

13

32.5%

40-50

22.5%

50-60

5%

Q. What is your Educational Qualification?

Bcom
BBA
Architect
Diploma in Event Management
Engineer
MBA
M.Com
MCA
Masters Program In Govt.
Interior Decorator
MBBS

30

Q. What is your Occupation?

Architect
Businessman
Engineer
Doctor
Employee
Entrepreneur
House Wife
Q. What is your annual income?
Fig 2

100000-500000

15

37.5%

500000-1000000

18

45%

More than 1000000

15%

Q. In which Bank do you have bank Account?

Bank Of Baroda
Bank Of India
Citi
SBH
SBI
Buldana Urban
ICICI Bank
Kotak Mahindra
Syndicate Bank
Axis
HSBC

31

Q. What are types of account you have?

Fig 3

Saving

20

50%

Current

18

45%

Demat

2.5%

Q. How many time you visited to bank in month?

Fig 4

Less than 5 times

18

45%

5-10 times

18

45%

More than 10 times

7.5%

Q. Do you use Internet banking?

Fig 5

32

Yes

33

82.5%

No

12.5%

Q. What types of service you like while using internet banking?

Fig6

Fund Transfer

22.5%

Bills Payment

12

30%

E-statement

20%

Tracking Status of your Service Request

12.5%

E-checks

5%

Q. How would you rate customer care services rendered by the bank with respect to
Internet Banking?
Fig 7

33

0%

15%

13

32.5%

12

30%

5%

Q. Have you logged any compliant regarding internet banking facility?

Fig 8

Yes

28

70%

No

22.5%

Q. If yes, in how many days bank addresses the issue?

Fig 9

34

2-3 days

11

27.5%

3-7 days

16

40%

More than 7 Days

10%

Q. Which social media platform you use?

Fig 10

17

42.5%

Twitter

20%

LinkedIn

17.5%

Others

7.5%

Facebook

Q. Are you satisfied with the way of solving issue?

Fig 11

35

Yes

28

70%

No

17.5%

9. Discussion
Customer Value Improvement strategies

36

a) Identify Customer Value

In the funds industry, the cost of customer acquisition is very high and the selling cycle is quite
long. It takes easily 1-2 years, if not longer, for prospecting a customer. Thus, the Capability to
retain existing customers, specially the good ones, is crucial to Fund Services.
Hence, it is of paramount importance to:
1) Find out what these customers value most;
2) Deliver such value to satisfy them (or exceed their expectations);
3) Nurture the existing relationship;
4) Keep them as our loyal customers all the time.
To find out what are the services valued most by the targeted 20% of the customer, we need to
conduct face-to-case interview sessions with the customers individually to solicit their direct
feedback. Having said so, I recommend that a standard questionnaire to be designed to facilitate
the interview sessions. By doing so, we allow the flexibility to obtain any unsolicited input from
customers yet we can also set the scope of the interview so that we can have a common and
meaningful base to further our investigations.
b) Decide and Develop Value Improvement Initiatives
After we find out the customer expectation and value gap, we have to plan the detailed actions to
bridge the gaps.
c) Implement Improvement Initiatives
After we work out the improvement initiatives, we have to form task force(s) to implement them.
Three factor improvement Recommendation for CRM
People Factor:
A positive interaction among employees, customers, and vendors will
create a successful enterprise.
If there are complaints from employees about the customers, vendors,
other departments as well as complaints about employees from the side of
customers, the gaps have to be bridged before starting a CRM initiative.
Training sessions should be held for employees to educate them about the
importance of CRM and train them in the same.
Process Factor:
The CRM success is also influenced by the process factor.
Before introducing a new technology, the bank management needs to
review their business and workflow processes
Planning Factor:

37

Planning is a particular kind of decision-making that addresses the specific

future that managers desire for their organizations.
A well-developed plan will give the managers to stretch boundaries and
achieve organization goals.
Some of the important parameters in the plan are Deadlines, Flexibility,
Integration, and Metrics.

10.Conclusion
The banks are now under tremendous pressure to retain the older customers because of the
competition in the Banking Sector. This would not only ensure better customer relations but also

38

loyalty among them, which is very critical and important in todays competitive world. Banks
have started acknowledging the importance of the customers in developing their business. They
have recognized that it is essential to protect and grow its customer base and ultimately its
profitability. The banks can do this by building a strong relationship with the customers. To meet
the customer needs and to beat the competition, they must deliver superior quality service. The eCRM approach adopted by banks focuses on maximizing the value for the customer and the
bank. The key drivers to customer loyalty are:
(a) Positive online Services
(b) Honesty, Integrity and Reliability.
(c) Productive advice and delivery of the promised service.
(d) Consistent delivery of superior quality service.
(e) Simplicity and easiness of doing business.
(f) A fair and efficient complaints resolution.
There is an immense need of adequate training and motivation to the bankers to create fruitful
and everlasting relations with their valuable customers. The more effectively you can use
information about your customers to meet their needs, higher the satisfaction the more profitable
we will be. Operational e-CRM needs analytical e-CRM with predictive data mining models at
its core.

11.References

www.cdrb.org/journal/2009/4/2.pdf
http://rbi.org.in/scripts/BS_CircularIndexDisplay.aspx
citeseerx.ist.psu.edu/viewdoc/download?doi=10.1.1.126.161

39

http://www.theglobaljournals.com/ijar/file.php?val=MTUxNw
http://prj.co.in/setup/business/paper40.pdf
www.isrj.net/UploadedData/220.pdf
http://www.managementparadise.com/itm_mumbai/documents/5898/icici-bank-crm/
http://www.ijcns.com/pdf/2009.pdf
www.euroasiapub.org/IJRIM/sep2012/6.pdf

12.

ANNEXURE
Questionnaire
40

1. Name

2. Age
Mark only one oval.
2030
3040
4050
5060
3. What is your Educational Qualification?

4. What is your Occupation?

5. What is your annual income?

Mark only one oval.
100000500000
5000001000000
More than 1000000
6. In which Bank do you have bank Account?

7. What are types of account you have?

Mark only one oval.
Saving
Current

41

Demat
8. How many time you visited to bank in month?
Mark only one oval.
Less than 5 times
510 times
More than 10 times

9. Do you use Internet banking?

Mark only one oval.
Yes
No
10. What types of service you like while using internet banking?
Mark only one oval.
Fund Transfer
Bills Payment
Estatement
Tracking Status of your Service Request
Echecks
11. How would you rate customer care services rendered by the bank with respect to Internet
Banking?
Mark only one oval.
1
2
3
4

12. Have you logged any compliant regarding internet banking facility?
Mark only one oval.
Yes
No

42

13. If yes, in how many days bank addresses the issue?

Mark only one oval.
23 days
37 days
More than 7 Days
14. Which social media platform you use?
Mark only one oval.
Facebook
Twitter
LinkedIn
Others
15. Are you satisfied with the way of solving issue?
Mark only one oval.
Yes
No

43