The implementation of CRM systems in banks: The case of Caisse d'Epargne

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The implementation of CRM systems in banks: The case of Caisse d'Epargne

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Abstract

Since a few years, many banks have adopted strategies of Customer Relationship Management. CRM can be defined as an approach based on new communication and information technologies, in order to identify the customers' needs and expectations to provide them with adapted products and services. One of the objectives of this method for a firm is to make customers more loyal and to build a long-term relationship with its clients, which will high chances in resulting to an increase in profits.

To implement this new type of relationship with their customers, banks call on relational marketing which is very popular among services firms like banks, and new information and communication technologies, in order to reconcile in real time the clients' expectations with the available supply. Faced with this major challenge of implementing a CRM system, banks wonder about the methods and tools to use in order to better monitor the relationship with the customers.

Introduction: Definition of CRM
The need of CRM for proximity banks
Presentation of Caisse d'Epargne (CE) and its needs in terms of CRM
Limits of the implementation of CR at the CE
Assessing CE's strategy
Conclusion

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[...] Indeed, does such a system correspond to the initial objectives of the CE, which gave itself a social mission since its creation? In order to correctly assess CE's strategy, it is worth using the concept of strategic alignment; indeed, strategic alignment means that the information system enables the display of a firm's strategy. The IS needs to be coherent with the firm's strategy and its organizational processes. This idea has been proposed by the model of Henderson and Venkatraman (1993): Functional integration Strategic coherence Despite the fact that this model may seem utopian, we can use it to assess CE's strategy: S. [...]

[...] Faced with this major challenge of implementing a CRM system, banks wonder about the methods and tools to use in order to better monitor the relationship with the customers. Our study will focus on the particular case of French “proximity banks”, where the relationship with the client is even more fundamental than in the other types of banks. We have chosen the particular example of Caisse d'Epargne because, as we will see later, it is faced with new challenges which have led the bank to implement a new system of CRM in 2006. [...]

[...] The simulation allows better evaluating on the products to develop and the profile of clients to target. This can help orientate the communication and marketing policies of the bank. It seems that the new systems correspond to a CRM logic[1]: ⇨ Identification phase : identifying the potential clients of CE ⇨ Personalization phase: CE offers various products and services according to the clients' profile ⇨ Satisfaction phase : CE wants to satisfy its clients ⇨ Loyalty phase : CE is looking to earn its clients loyalty ⇨ Profitability phase: CE's ultimate goal is to increase its clients' profitability and only keep the profitable clients The organizational stakes linked to the implementation of a new IS in a bank We could tend to believe that the technologies used by the CRM can be a problem but actually, the organization itself creates more difficulties. [...]

[...] However, CE's employees are rather reluctant towards the new CRM system and it seems that CE's strategy has not been properly explained to them. So if things have not been clearly explained, can a strategic alignment really happen? We can really wonder about the relevancy of the CRM for the CE: maybe they only implemented it because it was a trend in the banking industry. However, we think that CE should have conducted its differentiation on what already differentiates the firm from its competitors: its social mission. [...]

[...] It implies an allocation of the resources (especially the technological ones) which commits the firm on the long-term and which enables the firm to meet various objectives such as obtaining a competitive advantage, creating value for clients, meeting the expectations of the stakeholders In the CE case, it seems that CE wants to differentiate itself from its competitors by adding value for the clients through the CRM systems. Therefore, CE targets the most profitable segments. This strategic orientation is due to the external environment and it directly impacts the technologies used by CE. [...]

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