The submitted dissertation critically discusses business models in the context of customer dimensions under uncertain market conditions.
The following questions summarise the fields of investigation:
• How do business models adapt to rapidly changing and buyer driven markets?
• What are the next two steps after Customer Relationship Management?
• Can the gap in the process chain between ‘Customer Relation Management’ and ‘Sup- ply Chain Management’ be bridged and how?
• How can a method be developed in order to measure the current customer orientation of a company and to compare companies among each other?
• Are customer oriented companies more profitable?
As a deductive research approach is used, beneath a small number of inductive elements, an investigation in both secondary and primary data is imperative. Subsequently a critical review of related literature along with a supporting inquiry is part of the dissertation.
The scope of the work includes background information, the discussion of future business models as well as an empiric impression of ‘customer orientation’ in German small and me- dium sized enterprises.
The most significant conclusions can be recapitulated as follows:
• Simple customer orientation can lead to less innovation, furthermore to unprofitable business and in the worst case to the elimination of a company.
• Customer oriented strategy is about building processes that are able to react to any en- vironmental or economical modification as fast as possible
• The evolution of Customer Relation Management will lead to new customer driven and pulled business models, including innovative measurement methods like ‘Return on Customer’
• The gap between Customer Relation Management and Supply Chain Management will in all probability be bridged, new concepts (e.g. Customer Chain Management) will represent this task
• A ‘balanced’ Customer Centric Index, developed as a benchmark instrument as part of the dissertation, shows that only a third of the examined companies can be interpreted as ‘customer oriented’, on the other hand ‘Sales & Marketing’ is regarded as the initial and most influencing process.
• A statistical connection between ‘being customer oriented’ and ‘profit’ could not be proved
• As a surprising and unintentional result the survey revealed that focusing on a small market (niche) is, at least for SME, a more profitable business.
[...]
Table of Contents
1 Introduction
1.1 Introductory background
1.2 Research question and aim of the dissertation
1.3 Methodology
1.3.1 Identify the broad area
1.3.2 Select the topic
1.3.3 Decide the Approach
1.3.4 Formulate the Plan
1.3.5 Collect the Information
1.3.6 Analyse the Data
1.3.7 Present Findings
1.4 Limitations
1.4.1 Time
1.4.2 Assumptions
1.4.3 Secondary data
1.4.4 Primary data
2 Literature review
2.1 70ies and earlier: Black Fords
2.2 80ies: In search of excellence
2.3 90ies: Core competence
2.4 Y2K: Cost cutting
2.5 Summary
3 Step One: Customer Relation Management
3.1 From Marketing to CRM
3.2 Market conditions
3.3 Definitions
3.4 CRM sectors
3.4.1 Analytical CRM
3.4.2 Operational CRM
3.4.3 Communicational CRM
3.5 Success factors & critique
3.6 Summary
4 Step Two: Customer centric business models
4.1 From CRM to CCBM
4.2 Crucial requirements
4.2.1 Strategy
4.2.2 Business models
4.2.3 Processes
4.3 Assumed consequences
4.3.1 Organisational structure
4.3.2 Customer value vs. company value
4.3.3 Return on investment
4.4 Success factors & critique
4.5 Summary
5 Step Three: Customer Chain Management
5.1 Supply Chain Processes
5.2 From CCBM to CCM: An attempt to fill the gap
5.3 Summary
6 Survey
6.1 Introduction
6.2 Results
6.2.1 Core competence
6.2.2 Initial processes
6.2.3 Negotiating power
6.2.4 Customer centric index
6.2.5 Customer centric company cluster
6.2.6 Margin & market share
6.3 Summary
7 Conclusion
8 Bibliography
9 Appendices
9.1 Appendix A – The survey
9.1.1 Covering letter
9.1.2 Questionnaire
9.2 Appendix B – Additional calculations
Research Objectives and Themes
The dissertation investigates the evolution of business models in response to changing, customer-driven market conditions, specifically focusing on the process gap between 'Customer Relation Management' (CRM) and 'Supply Chain Management' (SCM) to develop a more integrated 'Customer Chain Management' (CCM) approach.
- Adaptation of business models to rapidly changing, buyer-driven markets.
- Evaluation of evolutionary steps beyond traditional Customer Relationship Management.
- Bridging the process gap between CRM and Supply Chain Management.
- Development of methods to measure customer orientation and its correlation with company profitability.
- Analysis of organizational requirements and success factors for customer-centric business models.
Excerpt from the Book
1.1 Introductory background
In recent years there has been a dramatic change in how enterprises shape their business models. This is mainly driven by an economic situation that can be summarised by saturated markets, substitutable products plus services, fragmented along with hedonistic customer behaviour combined with decreasing customer loyalty as well as a decline in profits.
These tremendous challenges have already ruined several enterprises. An essential impact is supposed to lie in the relationship of enterprises with their customers. For a long period of time the ‘Shareholder Value’ has been the exclusive measurement of how to control and steer enterprises. Beyond it, recent discussions hint at a change in the strategic perspective. ‘Customer Value’ now emphasises a priority that might be set up in upcoming business models (see chapter 4.3.2).
‘Customer Relation Management’ (CRM) approaches are already in service. However CRM projects mainly driven through IT departments turn out to be too complex. Results are not clearly visible. The holistic CRM approach on the one hand therefore is regarded as being unsuccessful (Computerwoche 2002). On the other hand job descriptions like of ‘Chief Customer Officer’ demonstrate the necessity for companies to change in dealing with their customers.
By common consent it is assumed that the most profitable companies will be the ones that most satisfy their customers in addition to committing them by performance plus services. Furthermore, a reliable relation management is expected to be a guarantor for future success. Consequently more and more companies are searching for new and innovative ways to manage their customers, or to be more specific, to be managed by their customers.
Summary of Chapters
1 Introduction: Provides the research question, background, methodology, and an outline of the dissertation's structure.
2 Literature review: Situates the research question in a historical context by tracing the evolution of customer-company relationships over the last four decades.
3 Step One: Customer Relation Management: Explores the evolution from marketing to CRM, discusses market conditions, definitions, sectors, and challenges in current CRM approaches.
4 Step Two: Customer centric business models: Illustrates the transition from CRM to customer-centric business models (CCBM), covering requirements, consequences, and success factors.
5 Step Three: Customer Chain Management: Introduces the concept of Customer Chain Management (CCM) as a future approach to connect CRM and SCM processes.
6 Survey: Presents the primary research, including the objective, methodology, and the analysis of collected data regarding company core competencies, processes, and customer orientation.
7 Conclusion: Summarizes the main findings, discusses the validity of the customer-centric approach, and reflects on the future of business models.
Keywords
Customer Centric Business Models, CRM, Supply Chain Management, Customer Chain Management, Business Processes, Customer Orientation, Market Share, Profitability, Value Chain, Customer Lifetime Value, Return on Customer, Customer Centric Index, Business Design, Organizational Structure, SME.
Frequently Asked Questions
What is the core subject of this dissertation?
The dissertation explores the evolution of business models, specifically how companies can transition from traditional Customer Relationship Management (CRM) to advanced, customer-centric models and eventually to an integrated Customer Chain Management (CCM) approach.
What are the primary themes discussed?
The work examines the adaptation of business models to buyer-driven markets, the strategic integration of CRM and SCM, methods for measuring customer orientation, and the organizational changes required to become truly customer-centric.
What is the main goal of the research?
The primary aim is to investigate the "process gap" between CRM and SCM and to discuss the evolution of business processes in a customer-associated context, proposing steps beyond traditional CRM.
What research methodology was employed?
The study utilizes a deductive research approach, combining a comprehensive review of secondary literature with primary empirical research through a survey conducted among managers of German companies.
What does the main body cover?
The main body systematically analyzes the historical development of customer relations, evaluates current CRM practices, proposes customer-centric business models, suggests a path toward Customer Chain Management, and presents findings from a primary survey.
Which keywords best characterize this work?
Key terms include Customer Centric Business Models (CCBM), Customer Chain Management (CCM), CRM, SCM, Customer Lifetime Value, process gap, and business process reengineering.
How does the author define the 'process gap'?
The author identifies a hypothetical gap between CRM, which acts at the front end of the value chain, and SCM, which manages the back end, arguing that these two systems are currently uncoordinated despite needing integration to satisfy customer requirements.
What were the significant findings regarding SME profitability?
The survey results revealed an unintentional finding that, at least for Small and Medium Enterprises (SME), focusing on a small market niche is more profitable than broader market coverage.
- Arbeit zitieren
- Thomas Rolf (Autor:in), 2003, Customer Centric Business Models - Two Steps Beyond Customer Relation Management, München, GRIN Verlag, https://www.grin.com/document/21211
