Accelerating Customer Relationships: Using CRM and Relationship Technologies™

Table of contents

1. Copyright
   1. Dedication
2. About the Author
3. Preface
4. 1. Managing Customer Relationships 1:1
   1. Foundations of the Past Drive Our Future
   2. The Major Types of Customers
   3. Who Really Knows Their Customers?
      1. Customers Expect You to Know Them
      2. It Could Be Bad News If...
   4. Keeping the Customers You Have
      1. Swift’s Reasons for “Why Wal-Mart Continually Succeeds”
   5. How You Serve Your Customers Is a Major Competitive Differentiator
      1. Consistency of Service: Royalty Becomes Loyalty
   6. Defining Customer Relationship Management
      1. Strategic and Tactical Goals of CRM
         1. Right Customer
         2. Right Offer
         3. Right Channel(s)
         4. Right Time
      2. CRM—All Activities that Turn Casual Consumers into Loyal Customers
   7. Some Companies Do CRM Naturally
   8. Targeting Profitable Customers
   9. Positioning Is the Key to Success in Business
      1. Everyone Is After Everyone Else’s Customers
   10. Who Owns the Customer?
       1. Manufacturers May Go Directly to Your Customers
   11. Changes in Customer Positioning
       1. Use Old Information to Create New Actions
       2. Knowing Your Customers Boosts Profitability
   12. Using Data Better Enables You to Manage Relationships with Your Customers
   13. CRM Is Easy for Small Companies
   14. Large Companies Must Succeed at CRM
   15. CRM Is Not Easy for Many Companies
   16. Costs and Benefits of Relationship Management
   17. Who Is Responsible for CRM?
   18. Why this Book Is for You!
   19. Are You Ready for CRM?
       1. Companies Will Need to Be Flexible
   20. Marketing Communications Strategies
   21. The Power of Relationship Optimization
   22. Management Considerations
5. 2. Defining Your CRM Process
   1. Why Create a Process for CRM?
   2. CRM As a “Process”—Not a Project
   3. Major Objectives and Benefits of a CRM Process
      1. Higher Returns on Investments over Time
   4. From Product Focus to Customer Focus
   5. The Business View of a Marketing Process
      1. Tactical Integration of the CRM Process
      2. Preparing for Change
      3. The Emerging CRM Organization
   6. The CRM Organization’s Structure
      1. The CRM Marketing VP
      2. The CRM Marketing Analyst(s)
      3. The CRM Campaign Manager
      4. The CRM Segment Manager
      5. The Channel Manager(s)
   7. Integration of Business, Information, People, Process, and Technology
   8. Successful Excellence: Israel’s Pele-Phone
      1. A New Market Entrant = Gaining Competitive Advantage
      2. Pele-Phone’s Business Challenges
      3. Pele-Phone’s Data Warehousing Solution
   9. Data Warehouse Requirements Definition
   10. Management Considerations
6. 3. The Role of Information Technology
   1. The Change from Data to Relationships
   2. Six Key Enterprise Priorities
   3. Four Stages of Knowledge Maturity
   4. Integrating the Business Functions and Info-Structure Provides the Foundation
   5. The Enterprise Opportunity
   6. Preparing for Cultural and Idea Interchanges
   7. The Role of Technology in Driving Customer Retention and Profitability
   8. Enabling Customer Retention and Higher Profits
   9. Who Are Your Customers?
   10. CRM Enables Customer Segmentation
   11. Data Data Everywhere
   12. Enabling the New Marketing Litany: The Four Cs
   13. Customer Retention
   14. Knowing the Customer and Using Cross-selling
   15. Enabling Target Marketing
   16. The Importance of Enabling Technologies
   17. The Emergence of Relationship Technologies
       1. Characteristics and Drivers for Relationship Technology ™
       2. How an “Active” Data Warehouse Is the Relationship Engine
       3. The Use and Value of Relationship Technologies
       4. The Emergence of Relationship Optimization
       5. Creating Value Through Relationship Optimization
       6. Shifting to “Event-driven” Marketing
   18. Excellence in Business Transformation: Hallmark Cards
   19. Management Considerations
7. 4. Learning from Information: Data Mining
   1. The World of Learning from Information Itself
      1. Business Context: The Mega-Issues
   2. The Role of Data Mining
      1. Relationship Technologies: Creative New Approaches
   3. Electronic Commerce
   4. Operationalizing the Customer-Centric Data Warehouse
      1. Combining Data Warehousing and Data Mining
      2. Communicating a Definition of Data Mining
      3. Suggested Definition of Data Mining
      4. Clarifying Knowledge Discovery
         1. Classes of Data Mining
         2. A Data Mining Taxonomy
      5. Data Mining and Knowledge Discovery Technologies
      6. Additional Techniques for Relationship Management Applications
   5. The Data Mining Process
   6. Using Data Mining and Modeling for Business Problems
      1. The Future: Toward Continuous Insight
   7. Selection Criteria for Data Mining Technologies
   8. Management Considerations
8. 5. The Stages of Growth for CRM and Data Warehouse
   1. Leveraging CRM and Data Warehouse: Stages of Learning
   2. The Six Stages of Growth
   3. Categorizing Analytical Approaches
   4. The Types of Decision Support
      1. Types of DW/DSS—A Summary
   5. Managing the “Stages of Growth” in Customer-Centric Enterprise Info-Structure Environment
   6. The Info-Structure or Framework
   7. DW Successes from Long-Term Detailed Historical Enterprise Data
   8. Any Question—At Anytime—of Any Data—from Any Level of Business
   9. Mature Data Warehousing and CRM Decision Support
   10. CRM and the Stages of Growth for Customer-Centricity
       1. Extending the Info-Structure
   11. Management Considerations
9. 6. Data Warehouse Methodology
   1. The Proof Is in the Experience
   2. The Planning Phase
   3. The Design and Implementation Phase
   4. Usage, Support and Enhancement Phase
   5. How to Achieve a High Degree of Scalability
   6. Management Considerations
10. 7. Building the CRM Data Warehouse and Info-Structure
    1. Defining Your Timeframes and Objectives
    2. Defining a DW Framework and Building a Data Warehouse
       1. Managing Operational Data into the Warehouse
       2. Transforming Data into Information
       3. Architectural Strategies—Centralized Versus Distributed
       4. Independent Data Marts Versus Enterprise Data Warehouse
       5. Data Replication and Propagation
       6. Middleware Requirements
       7. Data Modeling and Design of the Data Warehouse
    3. Building a Data Warehouse in 100 Days
       1. Project Outline
       2. Project Team Resources
       3. Understanding Data Organization Differences
    4. Phase 1: Analysis & Design
       1. Demand Analysis
          1. Analyze Business Needs
          2. Evaluate Data Sources
       2. Data Quality Test
          1. Create Test Data
          2. Analyze Test Data
       3. Business Data Model (BDM)
       4. Logical Data Model (LDM)
       5. Validation of Results
    5. Phase 2: Implementation
       1. Physical Data Model (PDM)
       2. Interface Programs
          1. Extracting Data from Source Systems
          2. Transforming Data into Data Warehouse
       3. Data Loading
          1. Provide Historical Data
          2. Initial Load
          3. Provide Current Data
          4. Periodic Data Transfer
       4. Concept of Operations
          1. Schedule Control
          2. Backup & Recovery
          3. User Access
       5. Aggregations (into Data Marts)
          1. Design Data Marts
          2. Implement Data Marts
       6. System and Integration Test
    6. Phase 3: Reports, Queries, and Analytical Uses
       1. Set Up OLAP Tool
       2. Designing Report Types
       3. Developing Report Templates
       4. Supporting Activities
          1. Installation: Hardware and Software and Networking Extensions
          2. Training (IT and Users)
       5. Conclusion—100 Days to Success !!!
          1. Author’s Notes:
11. 8. Critical Success Factors for CRM and DW
    1. The CSF for Success:
    2. Strategic “IT and Business” Enterprise CSFs
       1. Planning and Setting the Direction
       2. Service and Communication Management
       3. Technology Relationship Strategies
       4. Personnel Development and Enterprise Management
       5. Information and Asset Protection (Including Privacy Issues)
       6. Resource Investments and Application Strategies
       7. Contribution
    3. Information Infra-Structure CSFs
       1. Customer-Centricity Information and Application Systems
    4. Guidelines for Success—Knowing Your Providers
    5. Seven Rules for Discussions with CRM Solution Providers
       1. Rule Number 1: Never Take a Vendor’s Claims at Face Value.
       2. Rule Number 2: Never Assume a Vendor Reference Is Valid.
       3. Rule Number 3: Always Talk with the Reference’s IS Staff.
       4. Rule Number 4: Never Take IS Claims at Face Value.
       5. Rule Number 5: Always Talk with the Users of the System.
       6. Rule Number 6: Always Talk Without the Vendor Present.
       7. Rule Number 7: Always Talk with the Users Without the IS Organization Present.
    6. Business Questions and Issues
       1. Internal Question 1: How Is Your Risk Tolerance?
       2. Internal Question 2: Is Your System Mission Critical?
       3. Internal Question 3: What Is Your Processing Environment?
       4. Internal Question 4: How Much Data Do You Have?
       5. Internal Question 5: How Many Concurrent Users Will There Be?
    7. Information Technology Questions
       1. IT Question 1: How Big Is the System?
       2. IT Question 2: How Much Detail User Data Is on the System?
       3. IT Question 3: How Much Index Space Is on the System?
       4. IT Question 4: How Much Summary Data Is on the System?
       5. IT Question 5: Do Some Applications Go Against Specific Sets of Tables?
       6. IT Question 6: How Much Workspace Is on the System?
       7. IT Question 7: Are the Data Mirrored for Recovery?
       8. IT Question 8: Who Are the Users?
       9. IT Question 9: Do These Users Have Direct Access to the DW Corporate Historical Detailed Data?
       10. IT Question 10: How Many Users Utilize this System?
       11. IT Question 11: How Many Concurrent Users Are Supported?
       12. IT Question 12: What Types of Access Are Supported?
       13. IT Question 13: Was this Designed to Replace Another System?
       14. IT Question 14: What Are the Data Sources?
       15. IT Question 15: What Is the “Batch” Window?
       16. IT Question 16: How Do You Get Data In?
       17. IT Question 17: How Do You Get Data Out?
       18. IT Question 18: Can I See the Data Model?
       19. IT Question 19: Do The DBAs Tune All or Most Queries?
       20. IT Question 20: How Many DBAs and Systems Administrators Does It Take to Really Support the System?
       21. IT Question 21: If the System Size Doubled Tomorrow, How Many DBAs and SAs Do You Think It Would Take to Support It?
       22. IT Question 22: What Is the Disaster Recovery Plan?
       23. IT Question 23: Are You Where You Need to Be Today?
       24. IT Question 24: How Much Time Do You Spend Training the Vendor?
       25. IT Question 25: How Long After The Hardware Arrived Did You Deliver Your First Application?
       26. IT Question 26: If You Started Over Today, What Would You Do Differently?
    8. Business Users’ Questions
       1. User Question 1: What Did You Expect the System to Do?
       2. User Question 2: Does the System Do What You Expected It to Do?
       3. User Question 3: Are You Where You Need to Be Today?
       4. User Question 4: What Else Do You Need?
       5. User Question 5: How Much Time Has Passed Between When the Contract Was Signed and When You Could Actually Use It?
       6. User Question 6: If You Started Over Today, What Would You Do Differently?
    9. Red Flags
       1. Red Flag Number 1: No References Are Available.
       2. Red Flag Number 2: The Vendor Reference Doesn’t Check Out.
       3. Red Flag Number 3: The Vendor Must Be Present at the Meeting.
       4. Red Flag Number 4: The Users Cannot Make the Meeting.
       5. Red Flag Number 5: The Only Reference Is Halfway Around the World.
    10. Management Considerations
12. 9. Data Privacy: Ensuring Confidence
    1. The Need for Data Privacy
       1. Alert: Recent Alarms in the U.S.
          1. CVS/Giant Food
          2. American Express
          3. Sabre
          4. Lessons
    2. Guidelines—The OECD Principles
       1. Web Commerce and Privacy
       2. Beginning Resolutions—U.S. Self-Regulation Policy
       3. Study of Web Sites by the U.S. Federal Trade Commission
    3. Online Privacy Alliance
    4. The Emerging “P3P Standard”
       1. P3P Standards—Applicability to Data Warehousing
    5. European Legislation
       1. The Impact on Companies Operating in Europe
       2. U.S. “Safe Harbor” Principles
    6. The Approach to Privacy in Data Warehousing
       1. Threat and Opportunity
       2. General Privacy Requirements
       3. Global Privacy Requirements
       4. Privacy Impact on Data Warehousing, Data Mining and Database Marketing
       5. Opt-Out of Direct Marketing
          1. Additional Hints:
       6. Disclosure to Third Parties
       7. Opt-Out of Automated Decisions with Significant Effects (Example: Customer Creditworthiness)
       8. Notice of “Logic Involved in Automatic Processing”
       9. “Special Categories” of Data
       10. “Erasure or Blocking” of Certain Data
    7. Opportunity for Enhanced Customer Relationship Management
    8. Building Privacy into the Data Warehouse
       1. Enhancing the Logical Data Model
       2. Using Privacy Views to Support Restricted Access, Opt-Outs and Anonymity
       3. Providing an Interactive Customer Service Interface for Personal Data Administration
       4. Providing Reports to Verify Privacy Compliance
    9. Management Considerations
13. 10. Implementing Privacy and Customer Views
    1. Applying the Privacy Policies to a Data Warehouse for CRM
       1. Why the Platform for Privacy Preferences (P3P)?
       2. Application of Privacy Policies to a Data Warehouse
       3. Can Companies with a Data Warehouse Ignore the Privacy Issue?
    2. Opportunities for Managing Your Customers
    3. P3P Adoption Scenario: Retail Data Warehouse
       1. New/Enhanced Loyalty Card or Credit Card Program
    4. Enhanced Personal Data
    5. Potential Marketing Initiatives
    6. Using Privacy Views to Implement Privacy in a CRM Environment
       1. Reasons for Using Views
       2. The Concept of “Views”
          1. Author’s Note:
14. 11. The @ctive Data Warehouse
    1. A New Breed of Decision Support
    2. Knowing Differences—Old World Versus Active Info-Structures
    3. First Generation Implementations—The Refreshment Cycle
    4. Current Generation Data Warehouse Implementations
       1. Example: Transportation/Airline Customer Sensitivity
    5. Learn by Having Very Detailed CRM Data About Customers
       1. Example: Health Care CRM Before the Doctor’s Services
       2. Examples in Banking, Insurance, and Other Industries
    6. The @ctive Data Warehouse Strategy
    7. Web-Based Business Opportunities
    8. Paving the Future for Knowledge Commerce
    9. Coming of Age in the New Age of E-Commerce
    10. E-commerce and E-business
        1. Click-Stream Analysis Opportunities
        2. @ctive Data Warehousing for E-business on the Internet
        3. Privacy and The Internet
    11. Excellence in Business Transformation: Delta Air Lines Takes Off Using Advanced @ctive Data Warehousing for CRM
        1. Delta Air Lines’ Challenge
        2. Delta Air Lines’ Solution
        3. Delta Air Lines’ Benefits
    12. Management Considerations
15. 12. The Economic Value of CRM
    1. One-to-One Marketing
    2. Anticipated Results of CRM—Key Assumptions and Verifications
       1. Cutter Consortium Study on ROI in DW
       2. Risk of Failure?
    3. How to Get Your Economics Around CRM
    4. The Payback from Detailed Information...and the Cost of Not Having It
       1. High Returns
       2. Payback Performance
       3. Nimble Response
       4. Guarding Against Competition
       5. Accurate Direct Marketing
       6. Better Portfolio Management
       7. Service Versus Profits
       8. Measuring Success
       9. Identify Profitable Customers
       10. Smarter Marketing
       11. Driving Propensity Models for New Profits
       12. Channel Analysis
       13. Keep the Satisfied Customers
       14. Increasing Productivity
       15. Retaining (and Gaining) Customers
       16. Rapid Application Development
       17. Competitive Speed
       18. Investment Payback Results
    5. Advancing Toward Strategic Economics of CRM
    6. Management Considerations
16. 13. The Strategic View of Data Warehousing and CRM
    1. Sustainable Competitive Advantage (SCA)
    2. The Eternal Struggle of Business
    3. Strategic Thinking
    4. Data Warehousing and Strategic Thinking
    5. A Rising-Tide Strategy
       1. Strategic Paradox
    6. Data Warehousing and the Strategic Paradox
    7. Data Warehousing and Maneuverability
       1. Data Warehousing and CRM Are Prerequisites to a Maneuver Strategy
       2. How Strategic Executives Think of CRM and DW
    8. Management Considerations
17. 14. How Companies Succeed Using CRM, Data Warehousing, and Relationship Technologies
    1. The Financial Services Industry
    2. The Manufacturing and Distribution Industries
    3. The Retailing Industry
    4. The Airline Travel and Tourism Industries
    5. Ground Transportation Industry
    6. The Telecommunications Industry
    7. The Health Insurance Industry
    8. The Entertainment Industry
    9. The Financial Services Industry
       1. Bank of America—Data Warehousing for All
       2. Barclays Bank
          1. The Challenge: Profit Management Initiatives
          2. Barclays Bank: The Benefits
          3. Barclays’ Plans
          4. Barclays Bank Results
       3. Royal Bank of Canada—Know Your Customer, Know Your Business
       4. Union Bank of Norway—Increases Productivity and Profitability
          1. The Challenge
          2. The Union Bank of Norway’s Data Warehouse Solution
          3. The Benefits
    10. The Manufacturing and Distribution Industries
        1. Western Digital—Takes Quality to the Next Level
           1. Western Digital’s Challenge
           2. Western Digital’s Solution
           3. Western Digital’s Benefits
    11. The Retail Industry
        1. Migros—Optimizing Success in Sales Campaigns and Inventory Levels
           1. Migros’ Challenge
           2. Migros’ Solution
           3. Migros’ Sales and Inventory Analyses
           4. Migros—Productivity Gains
           5. Migros Benefits
           6. Migros’ Plans
        2. The Warehouse—Specialized Retailing in New Zealand
           1. The Warehouse Challenges
           2. The Warehouse: The Solution
           3. The Warehouse: The Benefits
        3. Sears—Re-inventing Itself
           1. Sears’ Business Challenges
           2. Sears’ Solution—“Re-invent Sears Itself”
           3. Sears’ Results—Tracks Items Individually and in “Clusters”
        4. Wal-Mart Stores (U.S.A.) Turn Data into Actionable Information
           1. Wal-Mart’s Challenges
           2. Wal-Mart’s Solution
           3. Wal-Mart’s Benefits
           4. Wal-Mart’s Results
    12. The Airline and Tourism Industries
        1. Continental Airlines—Managing Diverse Operations
           1. Continental Airlines’ Challenge
           2. The Continental Solution
           3. Continental Airlines’ Benefits
        2. Travel Unie’s Challenge—Keeping Its Customers Coming Back
           1. Travel Unie’s Business Challenges
           2. Travel Unie’s Solution
           3. Travel Unie’s Benefits
           4. Travel Unie’s Results
        3. Kinki Nippon Tourist (Japan)—Driving Toward “One-To-One” Marketing Strategies
           1. KNT’s Challenge
           2. KNT’s Solution
           3. KNT—The Benefits
        4. “One World”—British Airways, American Airlines and Qantas
           1. Creating the Future
           2. British Airways
           3. American Airlines
           4. Qantas
    13. The Ground Transportation Industry
        1. Burlington Northern Santa Fe Railway
           1. Burlington Northern Santa Fe—The Challenges
           2. BNSF Solution
           3. BSNF Benefits—A Better Understanding of Costs and Customers
           4. BNSF Results
    14. The Telecommunications Industry
        1. Israel’s Pele-Phone Communications—Maintaining Customers and Gaining Competitive Advantage
           1. Pele-Phone’s Business Challenges
           2. Pele-Phone’s Data Warehousing Solution
    15. The Health Insurance Industry
        1. DCB Actuaries and Consultants (Czech Republic)—Bringing a New World to the Olde World
        2. Anthem Blue Cross/Blue Shield—The Business Challenges
           1. Anthem’s Solutions
           2. Anthem: Analysis Saves Lives While Saving Money
           3. Anthem’s Results
           4. Anthem’s Cures for Today and Plans for the Future
           5. The Anthem Executive Interview
    16. The Entertainment Industry
        1. Harrah’s Entertainment, Inc.
           1. The Company
           2. The Challenge
           3. Goals
    17. Management Considerations
18. 15. Studies of Communications Industry Implementations
    1. The Oshita Research Project—Focus on Knowledge
    2. Four-Phase Technique for Research in CRM
    3. The Communications Industry—A Review
    4. Research Findings
       1. Strategic Impact
       2. Technology Integration
       3. Strategic Partnership
       4. Technology Assimilation
       5. Technology
       6. Customer Project
    5. Understanding Strategic Horizons
    6. Management Considerations
19. A. End Notes and Acknowledgments
    1. Author’s End Notes
    2. Chapter 1: Managing Customers
    3. Chapter 2: The CRM Process
    4. Chapter 3: The Role of Information Technology
    5. Chapter 4: Learning from Information Through Data Mining
    6. Chapter 5: The Stages of Growth of CRM and Data Warehousing
    7. Chapter 6: Data Warehouse Methodology
    8. Chapter 7: Building the CRM Data Warehouse and Info-Structure
    9. Chapter 8: Critical Success Factors for CRM
    10. Chapters 9 and Chapter 10: Ensuring Confidence and Implementation of Data Privacy
    11. Chapter 11: @ctive Data Warehouse
    12. Chapter 12: The Economic Value of CRM
    13. Chapter 13: The Strategic View of DW and CRM
    14. Chapter 14: How Companies Succeed Using CRM, Data Warehousing, and Relationship Technologies
    15. Chapter 15: Study of Implementations Communications Industry CRM
20. B. Bibliography/References