Effective CRM Implementation Through Critical Success Factors: Evidence From Pakistan
Effective CRM Implementation Through Critical Success Factors: Evidence From Pakistan
Effective CRM Implementation Through Critical Success Factors: Evidence From Pakistan
Saba Shakeel1
Research Scholar
Karachi University Business School, University of Karachi, Pakistan
sabashakeel90@yahoo.com
ABSTRACT
Innovative organizations continuously adapt in response to the environmental changes and
competitiveness. Increasingly transforming communication technology allows businesses to
come up with customize offerings to acquire, retain and grow customers. Customer
Relationship Management (CRM) system plays a role of liaison between organization and
customers and justifies customer-orientated culture. However, researchers have identified that
almost about 70 per cent of all CRM projects failed to achieve expected desired outcomes by
the companies around the globe. Therefore, this study is undertaken to empirically test the
critical success factors of CRM solution to measure the viability of a substantial investment by
entities in a technological-driven business strategy in the context of Pakistan. Primary data is
collected through internet-based survey from employees associated with Sales, Marketing and
IT functions of any sort of CRM solution deploying companies operating in Pakistan. Empirical
results are verified through Consistent PLS algorithm and Bootstrapping calculation under
SmartPLS 3. The results of this research suggest that top management support, information
technology, skillful and trained staff, organization culture and customer information are highly
significant in contributing to effective implementation of CRM solution in Pakistan.
1 Corresponding Author
Further, the authors (Tangaza, Muhammed, & Bala, 2015) cited in a study that western firms
have perceived that organizational factors are more responsible to the effectiveness of CRM.
Contrarily to this study these authors (D. & K.C., 2003) reinforce the importance of national
culture or country context while making business decisions. CRM replicated as per the norms
and behavior of western organizations will never bring the identical results in the non-western
firms.
Level of infrastructure and technological advancement are the determinants which need to be
present at every stage of CRM deployment. Countries ignorant from the high level of
telecommunication infrastructure and improved marketing prospective will not be achieved
desired results from CRM adoption (Lin & Xue, 2011). So it is essential for practitioners to
evaluate and researchers to examine statistically factors considered as critical to effective CRM
implementation in a particular country.
This opportunity can be availed only by organizations which make the effective use of
sophisticated technologies and integrated information systems. Customer Relation
Managements (CRM) solutions are computer software which allow organizations to develop
relationship with clients and potential clients one to one (Tileaga, Nitu, & Nitu, 2013). CRM
system plays a role of liaison between an organization and customers. It is one of the integrated
ideas of IT and business with a prime objective to develop sustainable customer relationship
through two way communication.
Over the last two decades, CRM has grabbed the attention of practitioners and academics due
to its significance to businesses and as a value creation tool. Vendors of CRM systems want
their clients (companies) to believe that it will help them to structure huge customer data with
little or no internal IT support. They also claim that it does not involve multifaceted or real-
time integration with other relevant systems. Such claims make the demand of CRM high.
However, customizing of such system can be difficult and expected level of integration cannot
be achieved through the interface tools of CRM vendors (Tileaga, Nitu, & Nitu, 2013).
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The study is primarily involved in statistical testing of critical success factors relevant for the
effective CRM implementation in the context of Pakistan. However, before initiating work on
the main study the author is required to undergo few generic questions which are also part of
this paper.
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The factors chosen for empirical testing are the gap identified in a review (Farhan, Abed, &
Ellatif, 2018). These critical success factors can also be found in more than 180 studies and
researches that were systematically and rigorously reviewed with an aim to identify typically
accepted CFAs for CRM implementation. Identifying similarities in the success factors among
organizations that have implemented CRM is a way to manage and control resources and
investments of organizations planning to invest into CRM and making the decision fruitful for
relevant stakeholders (Farhan, Abed, & Ellatif, 2018).
The review has come up with a comprehensive list of CRM CFAs, identified related measures
of all most accepted CFAs and classifying such CFAs into distinct groups (organizational,
technological, process and project) as per their inner properties. Due to inter dependability and
interrelationship one factor may appear in more than one group or category. However,
empirical testing of such CFAs in the light of the identified metrics is the gap identified for
future researchers and this studying is filling out the gap.
The ultimate objective of this paper is to empirically verify the five critical success factors of
CRM solutions on the basis of evaluation matrices identified through an academic review
(Farhan, Abed, & Ellatif, 2018).
1.4.Gap Analysis
(Rahimi & Berman, 2009) conducted a qualitative study based on a sample size of 20
companies evaluated the causes of success and failure of CRM project in relation to planning
and implementation stages. This study also carried out quantitative methods to identify success
factors of CRM. Questionnaire via internet were circulated and gathered 2210 responses.
However, merely 821 responses (37 %) were analyzed in evaluating the conclusion.
A study identifying the impact of involvement in CRM initiative on organizational
performance and inter – functional integration is carried out. The research is undertaken by
utilizing online survey techniques from a sample size of 30 large companies of Pakistan. The
findings highlighted positive but insignificant effect of planning, implementation and usage of
CRM project on organizational performance. The study has two limitations firstly, sample
companies were selected randomly on the basis of popularity of entity and size of industry not
on the basis of CRM implementation. Secondly, only marketing managers filled out the online
survey. Input from IT personnel have not been taken (Ashraf, Hamyon, Khan, Jaafar, &
Sulaiman, 2015).
Another study is done in context of private Higher Education Institutions in Sri Lanka to
identify relationship between CRM practices and customer satisfaction empirically testing are
undertaken. The findings highlighted that there is a positive and direct relation between
customer satisfaction and by CRM initiatives. However, the study has geographical limitation
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This research is conducted by analyzing the impact of CRM throughout the organization so
study must not be limited to Marketing functions only. Moreover, past researches significantly
highlighted success and failure factors but did not mention their magnitude. A systematic
review has identified a gap of empirical testing of suggested critical success factors for CRM
implementation in the light of given matrices (Farhan, Abed, & Ellatif, 2018). The review is
based on study of 182 publications focusing on CRM success/failure factors. This research is
a way to carry out the study further by working on gaps like empirical testing. Relative to the
sample size of 21 Portuguese companies and 85 responses to identify the motivation of CRM
adoption (Varajao & Cruz- Cunha, 2016) large sample size (61 companies/122 responses) of
this research is representative of significant industries operating in Pakistan.
This research is unique in different ways like: workforce of non – listed companies is also
participated in survey who is generally reluctant to share company information due to
confidentiality. It facilitated the author to incorporate comprehensive view of customer –
orientation in business environment of Pakistan.
Moreover, respondent’s organization are chosen carefully after confirming the presence of
CRM technology as well as the type/name of CRM software. Furthermore, survey is being
filled out by Marketing, Sales and IT Personnel who are frequently involved in dealing with
CRM so able to respond appropriately. Each variable with five average questions is sufficient
to evaluate its impact on CRM implementation. The research also highlighted how to ensure
valid responses and discussed ways of collected data through internet which could be
significant for future studies in any field.
As the study is done within the context of Pakistan so those corporate sectors which are
planning to deploy CRM solution will get a comprehensive view of success factors required to
be maintained in order to achieve desired objectives from the investment in CRM technology.
Further, organization already deploying CRM solution can channelize the information flow
with the inclusion or exclusion of certain functions like marketing communication, customer
service, compliant management department and data management department.
Vendors of CRM could get help about the advantages of CRM and apply it as persuasive
technique to increase sales and profits. It will guide organizations implementing CRM about
the actual contribution of organizational, technological, process and project factors.
The findings may help organizations to transform their approach of deploying CRM solutions
and can achieve the expected outcomes from technological-driven business strategy and get
best returns from investment in IT systems. The study will help in minimizing the risk factor
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The manner CRM being defined by the companies also influences its implementation and
practice. CRM as technological tool is relevant for effective initiative but understand CRM as
strategy will help in aligning entire organizational resources and stake. Moreover, CRM as
philosophy provides the foundation to this customer-centric business strategy (Tangaza,
Muhammed, & Bala, 2015).
According to a recent research (Tangaza, Muhammed, & Bala, 2015) trying to define CRM
identified that when we dig down the origin of CRM, relationship marketing is found because
both are connected with identical principles. However, terminology of CRM is derived with
the combination of relationship marketing and customer management. Breakthrough in
communication and information technology (ICT) provides wider assertion to the concept of
personalize marketing and focus on selling to individual customer as many offerings as
probable.
CRM is all about building, managing and growing most profitable customers effectively.
Another study pointed out that this idea is widely accepted by modern marketers who are more
likely to analyze and control marketing activities as customer-driven rather than product driver.
They are interested to win customer loyalty develop on relationship context in a long term
instead of one time profit earned as a sale transaction. They encourage to view interaction with
customers in a relationship dimension rather than handling every transaction as an individual
event. (Varajao & Cruz- Cunha, 2016).
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Therefore, businesses through such strategy retain and grow existing customer base because to
earn new customers are a way expensive (Tangaza, Muhammed, & Bala, 2015). These
customer and business related factors encourage organizations to adopt such tools which
objectify decision-making through informational infrastructure (Tileaga, Nitu, & Nitu, 2013).
A study with rigorous and systematic literature review identified CRM CSFs. The study
undertook scientific approach in planning, conducting and reporting the review. The
objective of the paper does not limited to identifying CSFs but also highlighting the matrices
so each factor could be measured for further empirical studies.
Firstly, authors developed an all-embracing list of 54 critical factors in the field CRM
projects extracted by reviewing more than 180 studies and researches. The objective is to
guide companies about CRM project effectiveness through highlighting frequently endorsed
and similar success factors. The review inferred them as most accepted success factors for
CRM project. Secondly, 51 researches and publications are undertaken in the field of
effective deployment of CRM and CRM CSFs in a tenure of 12 years (2005-2017). Upon its
literature review, 30 critical success factors are summarized and complied in a list. Further,
these factors are classified into four groups and each factor is classified in more than one
group due to inter – dependability and interconnectivity (Farhan, Abed, & Ellatif, 2018).
The study also ranked success factors based on highest frequency in past researches.
Therefore, top five CSFs are chosen for empirical testing in context of Pakistan by this study.
Moreover, these factors are representative of every classification so results of the study will
give comprehensive view of why companies are successfully implementing CRM strategy.
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CSFs provide direction to invest resources in an appropriate manner. These factors are criteria
of improvement which should be considered as fixed variables to achieve desirable outcomes
from a project. Moreover, these factors are also considered as least requirement a company
should fulfil in order to attain success in a particular project.
CRM success factors have ability to influence and get influenced by the one another. At the
same time, success factors also change their properties in response to a particular stage of CRM
implementation. Researchers (Farhan, Abed, & Ellatif, 2018) have identified that success
factors required to be executed in specific CRM implementation stage (a. planning, b. defining,
c. design, d. validation, e. deployment stage) in order to achieve optimum output consequently
the success factor will convert into failure factor.
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Different researchers and authors express caution to the adverse effects of CRM use which will
be probable when organizations ignore strategic factors like involvement and support of
management, alignment of CRM initiation with organizational vision and mission, inability to
comprehend the benefits of CRM solution at the level of organization as a whole (Sebjan,
Bobek, & Tominc, 2014).
Further, researchers frequently quoted instances of effective CRM implementation from
strategic view point. From utilizing the guiding principles of strategic orientation (technology,
customers, competition, cost management, innovation, entrepreneurial, quality and
productivity orientations) organizations undertake strategic decision-making activities. CRM
implementation often misunderstood as a technological tool merely while suppressing the
strategic aspect that applies more than information technology.
Authors have analyzed how strategic orientation affect the performance of CRM solution and
they found CRM initiation can be smooth and effective in firms where strategic orientation is
dominated (Moghadam, Vahdat, & Arfarafiei, 2013). Hence, top management support is
critical to the effective implementation of CRM to the extent that its absence will obstruct the
advantages of the system on the operations of the organization.
The authors (Ruivo, Mestre, Johansson, & Oliveira, 2014) have attempted to undertake a study
on integrative value of Enterprise Resource Planning (ERP) and CRM through a theoretical
model utilizing the Resource Based View (RBV) by the organizations deploying both
technology-driven software. The study aims to evaluate the impact of integrative value on
organizational performance and success rate of such IT investment.
The model asserts that CRM has power to synergize the value proposition expected to be
attained from ERP could create if no integration would have been developed. The authors
further assert that such integration will foster networking, interaction and relationship among
stakeholders and enable organization to synchronize processes and information previously
been gathered through both software efficiently. These assertions are made upon the rationale
that CRM establishes system which generates information from external sources contrarily
ERP specializes in pooling information through internal sources. Through integrative value the
firm will be able to make the most of this harmony. Precisely, the Information System (IS)
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However, such integration is very intricate. ERP software is generally aligned with the
operational approach of fulfilling business routines, formal procedures like procurement and
electronically approves numerous transactions. In order to make these systems’ integration
effective CRM functions need to be replicated to the same operational logic. This will unlock
the expected benefits of RBV (Ruivo, Mestre, Johansson, & Oliveira, 2014). RBV benefits
based on VIRO (Value, Inimitability, Rarity and Organizational structure) principle: value
creation, generation of resource controlled by few numbers competing firms, expensive to
imitate and firm must possess such expertise necessary to manage the resource (Barney &
Hesterly, 2017).
A research revealed a case on banking sector of Iran. The paper cited such research (Tangaza,
Muhammed, & Bala, 2015) reported that the sector realized the importance of CRM and
showed acceptance to CRM as a medium of performing significant organizational functions
like marketing management processes and corporate communication. However, the
deployment of operational CRM in banking sector of Iran is considered as unfavorable and not
feasible due to the extensive use of information and communication technology.
Study also highlighted discussion on success factors contributing to the effectiveness of Iranian
banks in achieving organizational objectives through CRM solutions. It concludes that
employee motivation must remain at the prime of CRM practice and skills to enhance attraction
for customers through art and craft of CRM. Bank managers must be trained to be
communicative customer experience and expectations in relation to service quality and level
of satisfaction and comprehend it at branch level (Tangaza, Muhammed, & Bala, 2015).
Human resource knowledge and suitable administrative support are critical factors for basic
CRM solutions (Bavarsad & Hosseinipour, 2013) (Sarmaniotis, Assimakopoulos, &
Papaioannou , 2013). Further, involvement of employees and their characteristics are crucial
in adaptation of CRM technology. Further, employees under organizational factors contributes
in CRM success. Staff ICT skills are required in CRM implementation (Nguyen & Waring ,
2013).
The study (Tangaza, Muhammed, & Bala, 2015) cited a case study of Chinese Telecom firm:
China Mobile which implements CRM and concluded that effectiveness of CRM depends on
the collectivist culture the firm adheres to. It is an important factor needed to be considered for
the critical success of CRM projects to be implemented by other firms in the same industry.
China Mobile incorporates global CRM effectively to manage profitable customers since
relevant stakeholders are familiar with collectivist culture. It also allows the firm to maintain
retention of unprofitable customers which is leading them towards greater market share with
strong customer base.
Another study on global CRM endorsed the idea that technology-driven business strategy can
be successful subject to the culture of respective nation. To test this assertion a study is
conducted to evaluate the acceptance of a website between nations including Germany, USA,
Canada and Japan. The results concluded that western countries with individualist culture have
greater acceptance in comparison to Japanese who demonstrated least satisfaction and little
loyalty due to their national collectivist culture. The case is cited by the study of (Tangaza,
Muhammed, & Bala, 2015).
A study cited by (Tangaza, Muhammed, & Bala, 2015) notified that service quality criteria and
measuring tools must also be consistent and translate into cultural context in order to achieve
optimum returns from the deployment of CRM solutions. Service quality measures vary widely
on consumer perception and the level of service other firms are providing in a same industry
which could be understood in a cultural context. Moreover, enhancing functional and technical
service quality will contribute to affect the perceived service quality according to a research
cited by (Adikaram, 2016)
Another study conducted to determine the relationship between CRM and customer satisfaction
in a context of Private Higher Education Institution in Sri Lanka. The findings showed positive
effect of CRM on the customer satisfaction. The study considered that customer satisfaction is
greatly dependent upon crucial service attributes which need to be highly taken care of by the
service sector organizations. The service quality at every execution point (pre, during and post
service delivery) must be consistent. These attributes are responsible to conclude the level of
satisfaction extracted by the customers upon service obtained (Adikaram, 2016). Another paper
cited that organizational culture is reflected from the business objectives which support
customer-satisfaction orientation (Farhan, Abed, & Ellatif, 2018).
One of the positive impacts of CRM solution is that it enables organizations in generating new
knowledge (Sebjan, Bobek, & Tominc, 2014). With such improved information and quality of
data mining organizations can tap new markets, influence existing customers to repeat
purchase, create expected level of value, establish sustainable relationship with customers
which lead firms to achieve favorable image and desired positioning.
Another study (Moghadam, Vahdat, & Arfarafiei, 2013) pointed out that the purpose of CRM
solution is to acquire, analyze and share meaningful information about and with customers. It
will help organizations to provide competitive, real-time and superior quality services to the
customers. CRM systems is an opportunity to record an integrated view of all customer
interactions through software application. Such data with the help of business intelligence are
analyzed and should be utilized as a meaningful and constructive feedback by the
organizations. Effective organizations translate system analysis into business strategies and
develop improved offerings for customer satisfaction and loyalty. However, low quality and
range of data can be responsible for the negative impact on the organizational performance and
create obstacle in achieving objectives.
For effective implementation of CRM right tool of data mining and clear methodology and
steps of acquiring information also possess significance (Sharma & Goyal, 2011). Further,
assessment of tools and processes of data feature, estimation of quality data gathered in relation
to customer, infrastructure of customer data, categories of client data types as well as
classification of data collection sources are the measures of data quality and required for CRM
implementation (Alshawi, Missi, & Irani, 2011) (Garrido-Moreno & Padilla-Meléndez, 2011).
2.3. Hypothesis
The study purposes the following hypothesis
H1: Top management support is statistically significant to the critical success factor for the
organizations which implement CRM effectively in Pakistan
H2: Information technology is not statistically significant to the critical success factor for the
organizations which implement CRM effectively in Pakistan
H3: Skillful, motivated and trained staff are statistically significant to the critical success factor
for the organizations which implement CRM effectively in Pakistan
H4: Organizational culture is statistically significant to the critical success factor for the
organizations which implement CRM effectively in Pakistan
H5: Customer information is not statistically significant to the critical success factor for the
organizations which implement CRM effectively in Pakistan
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Respondents of listed companies are associated to the following sectors: Technology and
Communication, Pharmaceutical, Textile Composite, Commercial Banks, Investment Banks,
Food and Personal Care Products, Fertilizers, Automobile Assembler, Automobile Parts &
Accessories, Oil and Gas Marketing Companies, Cement, Transport, Power generation and
distribution and Paper and Board.
Respondents of non-listed companies are associated with the following sectors: Media
Company, Television Network, Software Companies, Beverage Companies,
Telecommunication Companies, Clothing Retail Companies and Miscellaneous.
3.3. Population
The companies implementing any sort of CRM solution and operating in Pakistan constitute
total population for this study.
3.4. Sampling
Purposive sample techniques under non-probability sampling methods can best meet the
objectives of this study because generalization of population cannot be applied for this research
(Schmitz, 2012). The study requires companies which has implemented and already deploying
any sort of CRM solution in Pakistan to be filled the questionnaire. In order to meet this specific
criteria sample is drawn from mentioned technique.
3.5. Respondents
The researcher has set out three criteria to be fulfilled simultaneously by the respondent to
become eligible for answering the online questionnaire:
1. The respondent must be employed with a company operating in Pakistan
2. The company must implemented any sort of CRM solution.
3. The respondent must belong to either Sales, Marketing or IT function in a CRM
implementing company operating in Pakistan.
In order to ensure that the respondent has met the mentioned conditions respondent’s profile
section in the questionnaire required respondents to answer name of their organization,
department, designation and company-provided email.
The companies are searched via name on LinkedIn webpage and diverted to the official page
of the searched company. There is a table on the left-bottom on home page of company profile
depicting following section Home, About, Jobs, Life and People respectively click on People.
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Once researcher had got access to the potential respondents researcher started sending connect
requests with a standardized note describing the research purpose of connection. Upon
acceptance of connection a link of online-survey is in boxed and persuaded time to time via
text message to fill. In total around 1500-2000 connect requests are made to individuals
searched with above stated process succeed researcher to make more than 700 connections
back. The efforts of approx. 60 days generated 122 responses from 61 CRM implementing
companies operating in Pakistan. All responses are considered valid for analysis because by
the interaction with respondents individually all fields are being filled appropriately to ensure
accuracy and reliability.
(Farhan, Abed, & Ellatif, 2018) Identified Critical Success Factors, and empirically test these
CSFs based on specific matrices. So, the main questions are adopted from the matrices
suggested for questionnaire designing. In part a. there are five sub-sections representing
Section I: Top Management Support, Section II: IT systems (integration/management), Section
III: Skilful, motivated, and trained staff Customer service, Section IV: Organizational culture
Section V: Customer data (quality/share). On average five closed-ended questions of five-likert
scale ranging from strongly disagree to strongly agree are being asked under each section. Two
question pertaining to section II have different but closed-ended options.
In part b. respondent’s name, gender, age, education, name of organization, designation,
department and email provided by the company are required to answer.
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a. Eliminating risk factor or providing harm to others. While conducting the study no harm
is provided to anyone.
b. Prior consent from respondents are taken and informed about purpose of data collection.
c. Safeguarding secrecy and confidentiality of respondents and data collected.
d. Avoid such practices that are deceptive in nature. The purpose for which data is
collected must be utilized in the promised manner.
e. Right to withdraw is provided to every participant. If one was not willing to participate
then they are honored.
Primary data reflected that 61 companies operating in Pakistan have presence of CRM solution.
The actual number is much greater but 61 is verified through this study. The ratio of 40:60 is
observed between service and manufacturing sector companies deploying CRM solutions.
Hence, manufacturing sector is more aggressive in implementing CRM in context of companies
operating in Pakistan.
The types of CRM solutions which firms are actively deploying include MS Dynamics 365,
Microsoft Dynamics AX 2009, Salesforce 2.0, ORANGE, CRM Veeva 2.0, S&D or Edge,
ZOHO, vTiger CRM, WCMS, AX Dynamics, GMS/MMS and NPS (Net Promoter Score),
BOSS, 3CX, Mobile Intelligence (MI), ICRM, Fourgen, Tvc, DDS, BI's, NPDMS, CRM
Oracle Sales Cloud, TBP, Tech Mixers, Dealer CRM, ZRT, DTC and Operational & analytical.
Generally, sales, marketing, and information technology (IT) functions are mainly concern in
the implementation and practice of CRM. However, name of department dealing with CRM in
each company may vary on the basis of size and nature of business.
4.2. Demographics
Socio-economic characteristics of population statistically expressed is known as demographics
(Anonymous, Business Dictionary, n.d.). With the help of respondent’s profile section in the
research questionnaire the study has gathered gender, age, qualification of the respondents.
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Significant ratio (59%) of respondents fall under the age group of 26-35 years. However 2.4 %
respondents belong to 56 and above category. The demographics shows that CRM is being
utilized by employees from middle level of their career till retirement and have varying degree
of implications in relation to the age of employees being hired to serve CRM implemented
companies.
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Each respondents were enquired six questions to evaluate the role of top management support
as positively critical in implementation of CRM strategy.
Strategic plan is a tool utilized by senior managers for organizational resource planning and
absolute existence of CRM project in strategic planning is an indicator of support from senior
executives. Survey responses showed that more than 81% of the respondents agreed with
varying degree of intensity [Agree (57) strongly agree (43)] that their company have absolute
presence of CRM project in strategic plan. However, more than 7% respondent showed
negative response and 13 (10.6%) participants checked neutral to the idea that there is an
absolute presence of CRM project in their company’s strategic plan
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In order to get meaningful information from data collected by an organizations through keeping
records of sales, customers complaints and customer feedback it requires systems with
analytical capabilities and their integration with data generating sources like sales tracking
system. The integrated network of data collection and analysis can be helpful for entities to
drive desirable objectives from CRM projects. Therefore, companies assign greater budget to
system integration shows their concern to CRM success and indicates top management support.
More than 63% respondents showed assertive [agree (51); strongly agree (26)], 17 % negative
[disagree (16); strongly disagree (5)] and 24 respondents depicted neutral opinion regarding
their company’s assignment of high percentage of budget to system integration.
Top management support can be evaluated from the alignment or consistency between
organizational objectives and fulfilment of CRM initiative. When board members consider it
important to attain desired goals they will devise strategies accordingly. CRM is a business
strategy objectifying customer orientation and profit proliferation. Survey responses
represented that more than 64% [agree (50); strongly agree (29)] respondents believe that in
their company high percentage of broad members objectives are linked with the fulfillment of
CRM. Whereas, around 17% respondents demonstrated disagreement with varying degree of
intensity[disagree(16); strongly disagree(5)] and 22 survey participants checked neutral to the
connection of attaining strategic objectives through successful CRM implementation.
Top management support can also be analysed by the attitude of senior executives and their
problem solving skills. It is significant to refrain CRM initiative from probable constraints
and limitation for its success implementation. Therefore, active participation by senior
executives in the form of mitigating or removing constraints in the way of CRM
implementation is also a valid matric to measure top management support. Survey responses
highlighted around 54% participants agreed with varying degree of intensity [agree (47);
strongly agree (19)], nearly 22% respondents showed disagreement [disagree (18); strongly
disagree (9)] and more than 23% survey participants showed neutral response to top
management active involvement in mitigating constraints in the way of implementing CRM
effectively.
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Each respondents were surveyed two questions in order to evaluate the role of IT systems as
positively critical in implementation of CRM strategy.
System integration enhances usage and potential of data through meaningful and thorough
analysis. Therefore, systems containing customer data and their integration with analytical
tools and other internal information gathering sources could be a valuable metrics to forecast
viability of CRM initiative. Survey responses represented 64.7 % agreement [agree (51);
strongly agree (28)], 15.5 % respondents showed disagreement [disagree (14); strongly
disagree (5)] and 19.6 % respondents marked neutral to the question that high percentage of
systems that have information on customers are integrated in their company.
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Each respondents were asked fours questions in order to evaluate the role of skilful, motivated
and trained employees as positively critical in implementation of CRM strategy.
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Each respondents were interrogated seven questions in order to evaluate the role of
organizational culture as positively critical in implementation of CRM strategy.
Businesses strive for customer satisfaction, high retention rate, greater loyalty and repeat
purchase. To attain such goals organizations are required to embed with strong cultural values
where all resources are consistent with the objective to serve customers in an improved
manner. Therefore, identifying alignment of organizational objectives with customer
satisfaction is the good metrics of cultural values. Survey responses highlighted that 81.9%
respondents showed agreement [agree (43); strongly agree (57)], 39.8 % respondents
depicted disagreement [disagree (9); strongly disagree (3)] and 8.1% participants marked
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Effective control systems can help organizations to develop desirable practices as part of
organizational culture. Control system can make or destroy the integrity of employees and
organizational image. Companies devise efficient controls to assess service level to
customers. Therefore, identifying company’s level of commitment in serving customers
better by control system is an indicator of organizational culture. Survey responses
highlighted that 79.5 % respondents showed agreement [agree (41); strongly agree (56)],
9.8% participants depicted disagreement [disagree (6); strongly disagree (6)] and 10.6%
participants marked neutral when asked that their company closely assesses its level of
commitment in serving customer needs.
CRM strategy is adopted with a rationale to connect with customers more frequently with
multiple communication points. Survey responses highlighted that 77.8% showed agreement
[agree (54); strongly agree (41)], 8.1% participant depicted disagreement [disagree (7);
strongly disagree (3)] and 13.9% respondents checked neutral when asked that their
company’s competitive advantage based on understanding customer needs.
CRM initiative fosters customer orientation throughout the organization. The strategy focuses
on retention and growth of existing customers. Therefore, organizations require to embed
culture of creating value for customers by incorporating it into objectives and business
strategies. Survey responses highlighted that 83.6% showed agreement [agree (53); strongly
agree (48)], 8.1% participant depicted disagreement [disagree (4); strongly disagree (6)] and
9.0% respondents checked neutral when asked that their company’s business strategies are
driven by objective of increasing value for customers.
Customer focused culture demand personalized offerings and customized solution to key
customers. Through segmentation companies attain insights and specialities to deal with
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Each respondents were probed six questions in order to evaluate the role of customer data
(quality/share) as positively critical in implementation of CRM strategy.
CRM initiatives is a mean of knowing customers to the best possible extent. Data collected
through integrated systems can take any form but parameters like estimating potential
demand and customer segmentation on the basis of information analysed can easily represent
the strength and effectiveness of CRM system. Survey responses highlighted that 64.7%
showed agreement [agree (49); strongly agree (30)], 14.7% participant depicted disagreement
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CRM strategy works to ensure customer service, customer growth and satisfaction, and
identification of needs and repeat purchase etc. Survey responses highlighted that 68.8%
showed agreement [agree (51); strongly agree (33)], 9.8% participant depicted disagreement
[disagree (8); strongly disagree (4)] and 21.3% respondents checked neutral when asked that
their company maintains high rate of existence of a customer retention plan.
Strength and effectiveness of information systems can be indicated from the percentage of
new acquisition by customers. It simply means that customers have acquired more products
and services of the company in relation to past years. If CRM system can interpret the
reasons behind such triggered behaviour and response of customer it is the ultimate success.
Survey responses highlighted that 62.29% showed agreement [agree (50); strongly agree
(26)], 12.2% participant depicted disagreement [disagree (8); strongly disagree (7)] and
25.2% respondents checked neutral when asked that their company maintain high percentage
of annual acquisition by customers.
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So, composite reliability of each critical success factors of effective CRM including customer
information management 0.860, information technology 0.828, organizational culture 0.906,
skilful and trained staff 0.882 and top management support 0.920 plus CRM Success predicator
contains all matrices of CSFs and showing 0.954 composite reliability value are depicting good
reliability.
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CRM Success Cronbach’s Alpha with 0.953, organizational culture 0.904 and top management
support 0.920 are reflecting best internal consistency. Cronbach’s Alpha of customer
information management with 0.862 and skilful and trained staff 0.884 and information
technology 0.828 are demonstrating better internal consistency.
Hence, data gathered on CSFs of effective CRM implementation is reliable and consistent.
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Informatio Skilful
Customer Top
CRM n Organizati and
Informatio Managemen
Success_ Technolog on Culture Traine
n System t Support
y d Staff
CRM
0.677
Success_
Customer
Information 0.932 0.717
System
Information
0.642 0.409 0.841
Technology
Organizatio
0.994 0.883 0.532 0.761
n Culture
Skilful and
Trained 0.877 0.732 0.381 0.773 0.809
Staff
Top
Managemen 0.906 0.641 0.653 0.750 0.658 0.812
t Support
Skilful
Customer Top
CRM Information Organization and
Information Management
Success_ Technology Culture Trained
System Support
Staff
CRM
Success_
Customer
Information 0.935
System
Information
0.651 0.387
Technology
Organization
0.993 0.881 0.530
Culture
Skilful and
Trained 0.875 0.724 0.373 0.772
Staff
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Assessment of discriminant variability is essential for research papers as it mitigates the risk
that the latent variables are testing the same matrices under every construct. In order to ensure
that every construct is investing different and independent measures discriminant variability
test is run under quality criteria. Fornell and Larcker criterion is the most typically accepted
method in order to investigate the independence of latent variable in previous studies. However,
(Hamid, Sami, & Sidek, 2017) has identified issues in previous method of calculating
discriminant variability and suggested that for model with more than six latent variables need
to be verified by new means of estimating discriminant variability as it will better verify the
independence of latent variables construct.
The values in the HTMT table are mostly favorable and indicated with green color and showing
independence. However, customer information system, organizational culture and top
management support is indicating unfavorable values with red color and reflecting inter-
dependability. This interrelation is justified between the above factors as each factor is
classified in more than one category. Customer information system is classified as
organizational, technological and process factor responsible for CRM success. Further,
organizational culture is classified as organizational and process factor. Top management
support is classified as organizational as well as project factors. Therefore, these are
interdependent and interrelated variables and collectively contribute in CRM success.
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It is an important criteria of assessing the structural model PLS-SEM in the R squared values
which is also known as coefficient of determination. It reflects the proportion of variation in
the CSFs (dependent variables) that can be explained by the CRM success (endogenous
variable) in a regression model. (Chin & Marcoulides, 1998) Recommended interpretation
criteria for R square value 0.67 and above, 0.33 and above and 0.19 above are read as
substantial, moderate and weak respectively. An R-squared of 1.0 means that all matrices of a
CSF construct are completely structured by the CRM success. Hence, CSFs are absolutely fit
in relation to CRM success regression model.
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Level of significance or alpha is the probability of rejecting null hypothesis when it is true or
making type I error. In this study alpha is equal to 0.05. So p-value less than or equal to 0.05
indicates strong evidence against null hypothesis (McNeese, 2017).
When we compare p-value of Customer Information System in relation CRM success (0.008)
with significance level (alpha 0.05) we observe it is much lesser than 0.05. It is analyzed that
the results are highly significant so the study rejects null hypothesis and accepts alternative
hypothesis which indicates that customer information system is critical for effective CRM
implementation.
When we compare p-value of information technology in relation CRM success (0.000) with
significance level (alpha 0.05) we observe it is much lesser than 0.05. It is analyzed that the
results are highly significant so the study rejects null hypothesis and accepts alternative
hypothesis which indicates that information technology is critical for effective CRM
implementation.
When we compare p-value of organizational culture in relation CRM success (0.003) with
significance level (alpha 0.05) we observe it is much lesser than 0.05. It is analyzed that the
results are highly significant so the study rejects null hypothesis and accepts alternative
hypothesis which indicates that organizational culture is critical for effective CRM
implementation.
When we compare p-value of skillful and trained staff in relation CRM success (0.000) with
significance level (alpha 0.05) we observe it is much lesser than 0.05. It is analyzed that the
results are highly significant so the study rejects null hypothesis and accepts alternative
hypothesis which indicates that skillful and trained staff is critical for effective CRM
implementation.
When we compare p-value of top management support in relation CRM success (0.001) with
significance level (alpha 0.05) we observe it is much lesser than 0.05. It is analyzed that the
results are highly significant so the study rejects null hypothesis and accepts alternative
hypothesis which indicates that top management support is critical for effective CRM
implementation.
Results of past researches pointed out significantly high failure rate of CRM projects. Failure
of CRM project is interpreted as not meeting expectations in relation to cost efficiency,
objectives and benefits which have been anticipated before the investment on CRM initiatives.
Studies in the field of CRM mainly revolve around two basic approaches identifying success
and failure factors. Failure factors highlighted causes, elements and indicators that have
contributed to the ineffectiveness of CRM initiative. It is an approach of an organization which
divert resources on activities that need not to be done in order to get desired outcomes. It could
be an indirect approach but significant because high magnitude of failure factors can mitigate
the relevance of success factors.
Therefore, it is equally important to look into factors that may cause failure to CRM initiatives.
Organizational change, company policy/inertia, little CRM knowledge, and incompetent CRM
skills are identified as causes of failure by a study on data collected from 700 companies
(Krigsman, 2009). Moreover, low commitment and support by senior executives, lack of vision
articulation, weak change management strategies, inadequate training programs, inability to
adopt customer – centric approach and incompetent personnel are critical to the failure of CRM
technology.
From such factors it could be inferred that top management support and organizational culture
have power to develop or destroy the business. Emphasizing on building up and concentrating
on success factors which include greater top management support, skillful and motivated
workforce, customer – focused culture, system integration and high customer information
management effectiveness of CRM can be elevated. As it is a direct and positive approach of
capitalizing organizational resources to attain benefits including customer satisfaction,
customer loyalty, low complaint rates, greater retention and usage, repeat purchase and
advocacy by the customer.
This research is empirically validating the findings of previous researches because factors
statistically tested by the study are being identified by a systematic literature review of studies
discussed success and failure factors of CRM. However, scope, sample size, industry,
methodology, approach and objectives of this study could be contradicted from past researches.
And such contradictions are acceptable because it fulfils the criteria of unique contribution in
research. The results of this study are mainly focusing on what factors are positively critical in
implementing CRM project effectively within Pakistan and how they are measured. It is
significant for every business venture planning to implement CRM as business strategy.
5.2. Conclusion
Growth of organizations is dependent upon their flexibility in relation to rapidly transforming
business environment and ability to make appropriate decisions in order to achieve
competitiveness in dynamic business situations. Researches support practitioners in achieving
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Data collected from 61 CRM implementing companies in Pakistan through structured online
survey. Purposive sampling techniques is utilized to attain the objective empirically verifying
previously identified factors that can be positively critical to the effectiveness of CRM
implementations. This quantitative research is analysed through confirmatory factor analysis
(CFA) and structural equation model (SEM) of smart PLS.
Past researches in CRM field identified gaps like need of empirical testing of identified
factors so companies can anticipate the influence of each factor concretely. Moreover, gap of
limited participation from different functions of CRM implementing companies is also
highlighted. CRM strategy has implication in different functional areas like Sales and
Marketing, Customer Complaints and Service, IT and Supply chain hence it is essential that
workforce associated with such functions must become participants of CRM related research.
It facilitates comprehending 360 degree view of CRM technology for an organization and
other relevant stakeholder. This study however, addressed the gap to a greater extent because
Sales, Marketing and IT personnel have participated in the survey.
The research reveals that when an organization is planning to invest into CRM solution must
look the factors critical in successful implementation of such project. If an organization already
possesses support from top management, sufficient information technology, skillful, motivated
and trained employees, customer-oriented organization cultural and efficiency to manage
customer data then it’s a go ahead. Under this situation, the investment in CRM project will be
proved as highly suitable and feasible. It will be probable for organizations to extract desired
results from CRM implementation.
On the other hand, if an organization does not possess the mentioned factors then first work on
attaining characteristics which will help in effectiveness of CRM and once all indicators are
appeared do invest in CRM and enjoy innumerable benefits of CRM solution. Success factors
are interrelated and interdependent so it is recommended to verify all the indicators that show
presence of all factors simultaneously. Consequently, failure rate of CRM project is also
highlighted in this research cited by previous studies.
The study also suggests orientation for future research. There are twenty-five other critical
success factors for CRM which require empirical testing for further researches. This study can
be replicated to other geographical regions of the world by future academia. Furthermore, these
factors can also be verified by future researchers through other research instruments like
company visits, interviews or manual surveys.
5.3. Limitations
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Questionnaire
Note: Please indicate your level of agreement or disagreement with each of the following
statements.
1. There is an absolute presence of the CRM project in the company's strategic plan.
2. Significant percentage of our top-level management is actively participating in CRM
projects.
3. Our company allocates high percentage of budget in technology and communication
area.
4. Our company assigns high percentage of budget to system integration.
5. In our company, significant percentage of board members objectives connected with
fulfilment of CRM.
6. Top management of our company removes high percentage of organizational
constraints in effective implementation of CRM.
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4. What is the average number of information systems that have to consult someone in the
company for customer queries?
1
2
3
4
More than 4
1. There is a significant percentage of staff in our company that is aware of objectives and
benefits of CRM.
2. There is appropriate percentage of staff in our company has attended seminars to learn
significance of CRM.
3. Our company has qualified employees and resources needed to succeed in CRM.
4. Our company has existence of training programs that designed to help employees to
develop skills needed to manage customer relationships effectively.
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Respondent’s Name:
Gender:
Age:
Education:
Company Name:
Department:
Designation:
Company provided e-mail:
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