1/1/2011

UNIVERSITYOF WALES

CUSTOMER RELATIONSHIP MANAGEMENT

An investigation into the impact of customer relationship management and its effect on student recruitment from the Indian subcontinent; A case study of Cavendish College London | Rishad DCruz

ACKNOWLEDGMENT

My gratitude extends beyond the people mentioned here. As I see it, everyone who has contributed in some way or another to help me do this MBA bears some responsibility to me actually getting to this point. It was never my intention to study further however fate and circumstances proved otherwise. First and foremost I would like to thank Professor Bruce Sheppy, my supervisor who was a source of encouragement especially when I was about to give up. In addition, I extend my gratitude to my mother Philomena DCruz and Cavendish College Director, Mr. Mohammed Sadeghian who instructed me to do the MBA in the first place. Professor Alan Taylor who taught me the importance of quality management and Professor Ambrey Scholtz who taught me project management and gave me the opportunity to project manage the British Accreditation Council inspection at Cavendish College in May 2010. I realize that nowadays with so much going on in our lives with work pressures, studies and a personal life to juggle, writing a twenty thousand word dissertation is quite a challenge. Perhaps part of the glory of getting an MBA qualification is associated with this entire balancing act. I found encouragement in the most unexpected places and although I reached a point of giving up on many occasions the people around made me realize that giving up is not an alternative I could consider anymore. Not for this dissertation and not for anything I set my mind on. One major lesson I have learned that would stay with me through life, it is probably the quality of persistence and power of routine.2|Page

Dedication

I dedicate this dissertation to the stakeholders of Cavendish College.

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DECLARATION

I hereby declare that the work which is been submitted is my own work, except otherwise where it has been stated. The Harvard referencing system has been adopted in order to quote the ideas of other authors. This research is been submitted to the University of Wales for the requirement of the degree of Masters of Business Administration. Also this piece of research has not been submitted for any other degree in any other university.

Nemesio Rishad DCruz

Signed on.............................................Day of................................................2010

Mr. Bruce Sheppy

Signed on.............................................Day of.................,..............................2010

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AbstractThis study aims at examining the link between customer relationship management and recruitment of quality students from the Indian sub continent. The research carried out by the author focuses on the importance of managing inter personal relations between internal as well as external customer and recommends a strategy to create a system that can be executed by any college to improve its recruitment strategy.. The study indentifies flaws and fundamental lapses and oversights in current recruitment strategy with Cavendish College as a case study and indicates how the various departments with the college can look upon each other as internal customers and hereby improve their productivity and decrease the rate of errors, reduce the response time of preparing documents as well as correct errors during the production process thereby introducing lean management with a goal to adding to overall customer value. Customers are considered to be employees of the college, the agents, their staff, and the students, the parents of the students and the United Kingdom Border Agency and other stakeholders. Value is considered from six different points of view as depicted by Paynes six market model. The major contribution of this research is that customer relationship management taking into account internal as well as external customers TPIs directly impacts the quality of students. Two major assumptions are that all private colleges suffer from similar customer relationship management deficits and the commission structure is not biased.

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Table of Contents Acknowledgement Dedication Declaration Abstract Table of contents 1 2 3 4 5

Chapter I: Introduction and background1.1 1.2 1.3 1.4 1.5 Industry background Purpose of study Summary of each chapter Research question and objective Limitations 7 9 10 11 12

Chapter II: Literature review2.1 2.2 2.3 Introduction to services What is a service and who is a customer Who is a customer2.3.1 Internal customers 2.3.2 External customer 2.3.2 Figure based on the service marketing triangle depicting Internal and External customers.

14 15 16 18 18 19 20 25 29 32

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2.4 2.5 2.6 2.7

Service and quality Marketing the service Paynes six market model Customer relationship management

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Chapter I Introduction and Industry background

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1.1 Industry Background With an estimated 8.5 Billion pounds per year generated by International students course fees (Guardian, 2009) the United Kingdom ranks second after the United States of America as an education destination. The British council advertises a number of independent and Government quality assurance bodies such as Ofsted (Office for standards in Education), BAC (British Accreditation Council) and ISC (Independent Schools Council) that assure international students that their investment into their career is secure. Cavendish College was established in 1985 by the David Game group of colleges and subsequently took on board, current directors Mr Mohammed Sadeghian, Siamak Taslimi and Dr. John Sanders. Cavendish College has expanded internationally and currently has branches in India, Zambia, Iran, Russia, Bishkek, Sri Lanka and Armenia. With a student population of approximately seven hundred comprising of a majority of International students Cavendish College relies on the revenue earned from fees generated by overseas students. There are over 2000 listed education providers that are registered under the Tier 4 UKBA (United Kingdom Border Agency) sponsor list today. (UKBA website). On the 18th of January 2010 Cavendish College lost its sponsorship licence as part of a Government crackdown on an immigration loophole. The reason given to the college was that it failed to assess the intentions of the students pre-arrival. Just like Cavendish College more than sixty private colleges within the same sector lost their licences. Almost all education providers that target business through recruitment of International students must undergo a thorough investigation by the UKBA and gain accreditation from the BAC or British Accreditation Council. The author of this paper was commissioned to project manage the BAC Inspection for Cavendish College. Although exhaustive, the quality management very clearly states the range of documents needed in order to get the accreditation, (See Appendix 1). Topics range

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from health and safety matters to academic, staff and human resource management. Having been granted their sponsorship licence back as well as successfully extending their BAC membership Cavendish College is keen to maintain their status and not suffer any future blows to its reputation or business. The author seeks to identify fundamental weaknesses in the management process and outline a series of measures to boost International sales and increase profitability with a view to create sustainability in this extremely competitive industry. Although trends constantly change and recruitment markets vary, India has remained a strong contender in providing students to Cavendish. With a network of more than twenty operational agents in India, excluding their sub-agents the management seeks new ways to manage the recruitment process more effectively in order to meet the new UKBA legislations and well as keep numbers up. Over the next several months Cavendish College seeks to revamp its marketing strategy and internal management system to adopt and assimilate pre defined control mechanisms set by the quality management authorities such as the BAC as well as to incorporate a clear structure in order to effectively manage existing students and foster stronger relationships with business intermediaries such as the educational agents who operate as the face of Cavendish in their respective countries. Business generated through recruitment of international students follows a standard process of students approaching agents in their home country (In this case India). The agents are allocated an advertising budget to generate an interest in the college and fairly represent the college. Once the student is recruited the agent usually gets a commission of between ten to twenty percent depending upon the number of students he recruits. The current structure for new agents is ten percent for the first five per year and fifteen percent for each student sent over the fifth. Existing agents enjoy a commission of twenty percent and often share this with subagents they appoint with or without express permission from the college.9|Page

Although some of the major market leaders in education such as the United States of America and Australia have clamped down on recruitment through agents, England has very little control on this vast under regulated market as reflected by the suspension of over sixty colleges by the UKBA and indicated by the UKBA suspending recruitment from the entire North India region in February 2010. Across the globe, the United States of America is slowly releasing its grip on recruitment and is now working on a quality management system to attract good agents to operate in the market. A seminar conducted by Mitch Levintha Vice Chairman of the American International Recruitment Council (AIRC) has indicated several areas where recruitment could be regulated, monitored and quality controlled. Measures included by the Australian authorities involve allowing licences to recruit to only 22 out of the 121 companies that expressed an interest, (Indian Express, 2010). A major concern the college faces is how to manage the unethical recruitment practices of the many agents and sub agents and agents who operate purely on a financial basis with no regard to the students ability and intention to study. Having worked out loopholes in the UKBA controls many agents recruit students who eventually drop out of the system in order to seek illegal employment in the UK. This trend has become increasingly worrying and affects the general health of the college including its reputation. 1.2 Purpose of study The main purpose behind this study is to target effective recruitment in India. By effective the author means students who have a clear intention to study in the UK, who can afford living expenses and course fees, who do not necessarily rely on gaining employment in order to attend classes as well as having the ability to successfully complete the course applied for. This will be done through managing weak agents and creating a structure in order to identify a students intention pre-arrival. The measures include checking financial records, previous

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educational qualifications, creative potential in the case of creative courses, English proficiency and other checks incorporated from the UKBA regulations. This management system will however primarily rely upon fostering a strong relationship between the College and the agents and establishing a character and system based trust between the two supported by a rigorous framework or recruitment policies that force the agent to recruit effectively. The repercussions of repeated bad recruitment would be a cancellation of the agreement, and the benefits of good recruitment would cover various incentives financial and non-monetary. 1.3 Summary of each chapter This chapter focuses on establishing the reason for conducting the research. This is done through explanation of the research question and identifying the objectives. The reader is introduced to the educational sector and given a background of the organization upon which the research is based. This chapter further serves as a foundation to understanding the development of the study and facilitates the introduction customer relationship management elaborated in the literature review. The literature review is an in depth analysis of the nature of service, quality, values from the point of view or an organization and a customer, it also looks at the history of services and its evolution. It studies the application of service marketing principles against models and develops new models. The backbone of this review however is the analysis of customer relationship management and its impact on the sales of service, namely courses at Cavendish College. The chapter gives readers an insight into agency theory and contemporary approaches to segmenting markets and their customers through Paynes six market model. The researcher eventually draws certain conclusions and develops a model to incorporate the service marketing triangle philosophy into Paynes six market model as a recommendation to Cavendish College current management system.

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1.4 Research question and objective The research carried out is an investigation into Relationship management and whether employing relationship management strategies can directly influence sales. In the event of the research positively indicating that relationship management does influence sales the objective is to employ a new strategy to improve the quality and quantity of students as well as improve the morale of staff and third party intermediaries as a subsequent benefit.

Objectives summarized: 1. Investigate the relationship between CRM and sales 2. Introduce a CRM strategy 3. Improve sales 4. Improve quality and quantity of students 5. Improve staff morale

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1.5 Limitations Customer perception- Students who factor as a major target group for the questionnaires have a wide range of perceptions on service quality. Many come from different backgrounds, cultures and their exposure to western education is minimal if not non-existent until they arrive. Therefore what may be an acceptable level of service to one student may be unacceptable to the next. The researcher has tried to circumvent this hurdle by targeting a rich mix of students from multi cultural backgrounds. Employing phenomenological research as well as quantitative research methodologies information was gathered which seeks to represent the opinions of the larger majority of students. Internal customers- Research carried out investigating the morale of employees within the organization faced the problem of personal bias. Many admission staff are unsure about their future plans due to the lack of job security affected by their immigration status and reliance on work permit and ever changing VISA regulations. This uncertainty affects their decision to see themselves in the organization over the next five years. In addition, admissions staff that have chosen agents to work are biased to a certain degree on the way the agents operate and do not allow and transparency into their relationships. This may be due to cultural or linguistic reasons (Agent being unable to speak English). This may also be due to the fact that many officers plan on becoming agents themselves.

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Chapter II Literature Review

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2.1 Introduction to services: A service is an activity or benefit that one party can offer to another that is essentially intangible and does not result in the ownership on anything. Its production may or may not be tied to a physical product (Kotler and Armstrong, 1991). The service sector play an ever increasing and important role from an economic perspective contributing to almost three quarters of the United Kingdoms GDP, (Financial Times, 2010). (Wirtz and Lovelock, 2007) trace the evolution of services from the classical view of the creation and possession of wealth over goods and commodities which held that ownership rights should be asserted upon the good or commodity which raises the question how can one assert ownership over something that has value and that perished at the time of production? In his book the (Wealth of Nations, 1776) Adam Smith distinguished between productive and unproductive labour. He classified the former, as goods that could be stored and later sold whereas unproductive were those services that perished straight after production. Jean Baptiste the French economist and businessman later coined the term immaterial products which essentially meant that production and consumption are inseparable in services. Today however, we can argue the semantic dis-proportionality of these statements. Perhaps Baptistes views were only a reflection of his mentor Adam Smith, as it became quite clear in his edits of the La Decade philosophique, litteraire, et politique. Contemporary writers such as (Wirtz and Lovelock, 2007) present an entirely post modern view of services such as education which creates durable value and do not necessarily perish at the time of production; in fact it creates value that lasts a lifetime. When someone says that an article posses value, it is meant that one or more individuals are disposed to give a certain quantity of the labour of man, or a certain quantity of some other article or product obtainable only by means of that labour in exchange for it, (Smith, 2009). Value can also be described from an economic perspective as the monetary worth of something, (Webster, 2010). (Cheng, 2009),15 | P a g e

differentiates value in terms of absolute value and relative value. He gives readers the analogy of one menu charging fifteen pounds for a plate of fish and chips and six pounds for a roast chicken and compares it with another menu offering the fish and chips for fifteen pounds and a roast chicken for twenty nine pounds. He points that the fish and chips on the second menu is considered having less value even though the absolute value stayed the same at fifteen pounds. It was what the meal cost in relative terms that affects the perception of the good or service. It is quite apparent through looking at a variety of service sectors how Smiths classical view could not apply to the current nature of a service. This raises a question, are services also evolving? Is our understanding of a service not absolute, but perhaps only relevant to our time? (Wirtz and Lovelock, 2007) elaborate on the evolution of services as being constantly shaped by government policies, social changes, business trends, advances in technology, and internalization. When we look at the travel sector and companies such as Travelocity, Southall travels, and others we realize that a service is not necessarily perishable right after production, nor joined to the producer. On an economic perspective, the service sector alone contributes to 48% of Indias GDP. (CIA, 2010). Let us now examine a service and how it has evolved. We may then be in a better position to create a definition based on what we think is relative to its purpose in a current marketing perspective. What is a service and who is a customer? The simplest definition of a service is deeds, processes and performances provided or coproduced by one entity or person for another entity or person (Zeithaml, Bitner, Gremler, 2009). Services can also be defined as Economic activities offered by one person to another, most commonly employing time-based performances to bring about desired results in recipients themselves or in objects or other assets for which purchasers have responsibility (Wirtz and Lovelock, 2007). This reflects the idea that there is an exchange of value.16 | P a g e

Assuming we adopt the classical view of the four characteristics of services, (Palmer and Adrian, 2000) to be Intangibility, Perishability, Inseparability, and Heterogeneity the author has come across a very interesting analogy proposed by (Yagill, 2008). Yagill conceptualizes the service encounter as a theatrical experience. He fantasizes that the theatrical elements coalesce in the duration of the service act to eventually create a performance. Wirtz and (Wirtz and Lovelock, 2007) challenge the classical view of services through the example of a doctors surgery appointment. There was no transferring of ownership to you, neither did the doctor lose his ability to perform the surgery on another person after he worked on you (inseparability), you derive the value of the surgery far after you have been to his clinic (perishability). Many a time services attach themselves to a product as in the case of a telephone/broadband company such as British Telecom (BT). This makes the service tangible to a certain extent. One pattern that emerges through the evolution of services and its understanding is that it seeks to create value to the customer. Even though the purchasers may not necessarily have something to show for the money he spent i.e. a parachute jump or an evening in a night club, it is very clear that much has changed in the world of services. Hence building upon these arguments the author proposes this definition for a service A service is a process or a series of activities carried out by one or more individuals or an entity such as an organization that seeks to create or leverage value perceiving relative benefit and less perceived sacrifice to the consumer either immediately or over a sustained period of time. 2.3 Who is a customer? A customer as defined by (Kincaid, 2003) is a human being involved in the production process of a good or a service from the decision maker to the decision influencer to the end user. This definition raises a question. In the case of pet food, who is the customer? Is it the17 | P a g e

pet owner or the pet itself as it is the ultimate consumer and if it doesnt consume the product, the owner will resort to alternative products A more reassuring definition of a customer put forth by the ISO 9000 is an organization or person that receives a product or service. (Kincaid, 2003) indicates business as a set of relationships and points out that the moment people become aware of one another a relationship starts. In many service industries firms are valued on the basis of their customer base. The current customer relation represents value, (Dominick and Georgi, 2006). Therefore the implication of relationship management between organizations and customers must be enormous. Emotions are at the core of every action we take and yet for years businesses have ignored them (Shaw, 2007). Shaw elaborates, Focus on the customer, not the organization, and by doing so we will give you a differentiation through increased profits and higher shareholder value. He points out that a transition from an organizational focus to a customer focus will be painful, resource hungry and very costly. (Sexton, 2009), in apparent contradiction however says that In the long run an organizations value depends on two things, how it manages value and how it manages costs, clearly reflecting value from the view point of the organization. (Gilligan and Wilson, 2009) presents a more neutral view If companies knew how much it really costs to lose a customer they would be able to accurately evaluate investments to retain customers. (Kincaid, 2003) reminds us that a customer centred company makes plans and strategies based on the anticipated impact it will have on its customers. (Deming, 1986) said Just to have the customer satisfied is not enough.....you have to do better than that! Sower (2010) elaborates to explain the importance of establishing who a customer is. He says If we sell our products to a wholesaler, is he our only customer?, Internal customers are often forgotten and taken for granted. Understanding a customer, his needs, what he values, who he is and where he is a useful tool in developing a quality18 | P a g e

management system. After examining the above interpretations of a customer the author identifies a customer as those working within the organization in the chain of production, as well as the third party intermediaries or educational agents and the students, their parents and other stakeholders, including society as a whole (See figure below). The idea that business organisations have a range of stakeholders other than shareholders is obvious. Yet stakeholder theory has not guided mainstream marketing practice to any great extent, (Polonsky, 1995). Polonsky draws our attention to the importance and responsibility of every individual associated with the production and delivery of the service. Paynes six market model discussed in detail further in this chapter identifies the various stakeholders of an organization and distinguishes them into six major customer markets. The figure below is an adaptation of the service marketing triangle explained under the role of intermediaries and educational agents. 1. Internal customers: Inter-departmental college staff. An example scenario of a service provided to an internal customer is as follows. A request comes into the college from a potential student to apply for a course. The request is processed by admissions and forwarded to academics that check the qualifications and prepare the offer letter. The letter then goes back to the admissions team who acts as the customer and scans the document for any errors or imperfections. He then forwards the document to the agent who acts as an intermediary who further scrutinizes the document and finally passes to the student who is the final customer. 2. External customers- Are the agents, the students, legal advisers, the students parents, and the United Kingdom Border Agency (UKBA) who have set certain standards in order to filter bogus students from entering the U.K. An application that bears a mistake will cost the student and the college hundreds of pounds to reapply

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hence a clear stage gate process must be enforced through defining who customers are and where responsibility lies

Agents External customers Making promises

Staff Dept 1 I.e. Admissions

Staff Dept 2 I.e. Academics

Students Parents UKBA Others

Internal customer Enabling promises

The current working culture of Cavendish College has already adapted internalization of departmental customers to certain extent. Transforming current relationships and ideologies must be incremental and anchored through short term gains that management should display to employees. Understanding the motivation behind relationships will give us a key insight into how to develop a strategy to implement relationship management between all customers. Research indicated in the staff questionnaire inquires what motivates the staff and what barriers exist.

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The transformation of relationships coincides with the emergence of the concept of agency theory, (Verheijde, 2006). Traditionally, agency theory represented a financial perspective however upon closer examination Verheijde underlines that Agency theory assumes that psychological self interest is the sole responsibility of all the stakeholders. He elaborates that cost effectiveness and responsibility are the cornerstones of the theory. In plain English, Agency theory can be described as the method that seeks to get the best deal for both parties through each one obtaining certain degree of relative value through the transaction.

2.4 Service and Quality: (Sower, 2010) traced the roots of the term quality back to Plato. He proceeds to say that although the first quality movement started in America in the early 1920s it took flight during the Second World War. Eventually though, it was the Japanese in the 1950s who gave it a completely new focus and as a result rose to become a formidable economic player in the world. The classical definition of quality defined by (Juran, 1933) is fitness for use. (Fegenbaum, 1951) defined it as Best for certain customer conditions. Quality is defined by the ISO 9000 as meeting the requirements. Quality defined by Kodak is those products and services that are perceived to meet or exceed the needs and expectations of a customer at a cost that represents outstanding value. Analyzing both these definitions we draw a conclusion that the former is extremely vague and allows room for itself to emerge as a quality management company through setting these requirements. The latter adopts the Japanese kaizen or continuous improvement ideology where companies need to constantly aim at exceeding customer satisfaction. Both these definitions clearly indicate

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that quality is relative and can be looked at from the point of view of the company and the point of view of the customer. Is quality dependant on what the relative value of the commodity is? And from whose perspective? If we look at this from economic perspective of supply and demand we may be able to answer this question. Demand refers to how much quantity of a product or service is desired by buyers and supply refers to how much the market can offer, (Investopedia, 2010). If the demand for a commodity or service is indicative of the price we pay for something and vice versa then in a market of many suppliers and relatively stable demand perhaps the motivation to purchase a product now relies on something else, i.e. Quality. In the educational arena there are many basic quality standards such as the British Accreditation Council, Ofsted etc, however the willingness of a student to pay over and above a certain price i.e. paying a fee of 17,000 at UCL for a foundation course as opposed to paying 6000 to Cavendish for a foundation course now depends on what the customers perception of the value of the qualification. What services are attached to the course? Both have passed the quality standards and yet one course costs nearly thrice as much. Therefore quality is relative and depends on a customers perception of its relative value. In the case of education it is related to the job market, educational experience, work experience and many other factors used by marketers to attract business. Quality management in the service sector has suffered historically from an apparent diversity of unrelated approaches. Whilst the founder of the service quality or servqual model Parasuraman argued with Boulding and Sasser who went back and forth over the proper interpretation of desire, should and can the instability of service quality grew. It was eventually established (by Parasuraman) that there were five major dimensions of SERVQUAL (Kanji, 2005).

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Dimension 1. Tangibles

Description Physical facilities, equipment and appearance of personnel

2. Reliability

Ability to perform the promised service dependably and accurately

3. Responsiveness

Willingness to help customers and provide prompt service

4. Assurance

Knowledge and courtesy of employees and their ability to inspire trust and confidence

5. Empathy

Caring and individualized attention the firm provides its customers

A pattern finally emerged from the confusion through findings of Parasuraman, John and Tyas and Boulding which informed that service perceptions influences service quality, of which reliability emerged as the most important of all dimensions Parasuraman, 1999. An example of how service perceptions influence service quality can be explained through a study done by Yan Lu in 2008. His study involved how quality perceptions of elder generation Americans affected the sales in a supermarket. The study showed that as people grow older, their habits change and the research indicated that shopping is a major part of grey consumers' lifestyle and a source of pleasure rather than a necessary utilitarian chore. It also revealed that elderly customers pay far more attention to the service aspects of delivery and the buying experience than younger people indicating that service perceptions influence service quality. (Gronroos, 2000) defined perceived service quality as the outcome of a comparison between perceived service and expected service. There was still some confusion as to which attribute would be considered most23 | P a g e

important to customers bearing in mind that every customer was different. (Driver, 1999) presented a view that seemed to sit well with his contemporaries, which essentially proposed that the attributes would lie on a continuum ranging from the least interpersonal to the most interpersonal as depicted below. 1. Availability Least interpersonal 2. Access 3. Security 4. Comfort 5. Aesthetics 6. Cleanliness 7. Competence 8. Functionality Getting the service right 9. Responsiveness 10. Reliability 11. Integrity 12. Communication 13. Attentiveness 14. Flexibility 15. Care 16. Courtesy 17. Commitment 18. Friendliness Committing to the individual Most interpersonal Adapting to the individual Providing the service and environment

Applying this continuum to the quality management system of Cavendish College can be key to understanding customer expectations in this industry. The first six dimensions can be

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managed through an external and internal marketing perspective where the department will ensure information is available to all customers as a priority over the rest. This will be followed by access to the information through pre set channels. For example: In the event of Cavendish marketing it Masters of Business Administration course in a state such as Goa, India. It is essential to channel information of the availability, eligibility and course structure, fees etc to the potential market. I.e. Potential students who reside in Goa, India and have finished their Bachelors degree. Access to this information is through the agents and via the website. When it comes to getting the service right, in the same example we need to display our competence in terms of delivery. This is pre and current sales. In the pre sales stage it refers to that marketing aspect which communicates the success of alumni, the general grades awarded to the previous batch, the career opportunities and the wealth of information available to students once they enrol. The main idea which should be communicated is the value that will be generated to the student once he completes his Masters of Business Administration. Reliability will emerge as the most important as the customer gap will try to emerge at the point when students perceptions will not meet the actual delivery. Hence in the pre sales stage, the relationship managers duties must be to ensure that there is no misinformation given to the student by the agent or no false promises made. I.e. Service marketing triangle; promises made = enabling promises. Dimensions twelve to eighteen see the emergence of the day to day running of the organization and response to the students or current sales. From applying for college letters to getting results to welfare issues and cultural adaptation, students will have a multitude of requirements that must be addressed by the college effectively and in a manner that is professional and seeks to solve the problems of the students.

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2.5 Marketing the service: To apply and create a marketing strategy it is important for us to know that marketing itself is composed of a symphony of activities. Neil Borden in his publication (The concept of the marketing mix, 1964) coined the term marketing mix after James Culliton compared the job of a marketing manager as a chef who mixes ingredients. These ingredients according to Borden are product planning, pricing, branding, distribution channels, personal selling, advertising, promotion, packaging, service, display, physical handling, fact finding and analysis. In the 1950s however the term marketing, in its understanding was restricted to be product, price, place and promotion. (Boom and Bitner, 1981) add to it from a service point of view, process, physical environment, people and productivity as depicted in the table below. 1. Product: 2. Place and time: Is what seeks to create value for customers and is competitive Involves the delivery of the service to the consumer. I.e. classroom based lectures, handouts, training etc... 3. Price: Correct and competitive cost that reflects value created on the customers point of view. 4. Promotion: Is the marketing and communication of the value devised in the marketing strategy. 5. Process: Includes all those activities that are part of the delivery process. Remember the example of the theatrical performance. 6. Physical environment: Is the branding of the service through physical attributes attached to it, i.e. the building, the logos, the prospectus, the T shirts, DVDs and other promotional material. At the heart of communication is branding, (Sexton 2009).26 | P a g e

7. People:

Are those individuals who perform in front and backstage. These are the people that Sir Richard Branson defines as the Virgin type of person. He says that he bumps into them everywhere, bars, coffee shops, hotels, and libraries and so on. These people dont know theyre special, but they are; theyre out there and you can spot them (Branson 2009).) Jack Welch CEO of GE says finding great people is what GEs all about. Im on top of a lot of issues but none comes as close to the passion I have for making people GEs core competency. (Welch, 2007)

8. Productivity

(Lovelock, 2007) elaborates that an organization must consider productivity and quality as symbiotic. His opinion is that an organization must look at improving quality from the customers point of view and be very careful in making cuts that may be resented by customers.

Although traditional economists accepted the 4 P characteristics of marketing, Professor Bob Lauterborn, at the University of North Carolina identified that 80% of new industries fail. He attributed the failure due to an imbalance in the tradionalist view. His introduction of the 4 Cs (Consumer, Cost, Convenience, and Communication) gave businesses a new insight into marketing strategy that the author proposes as an intended strategy.

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Product Vs Consumer- Bob Lauterborn was of the opinion that there was no point in developing a product and then marketing it. He proposed businesses do it the other way around. Find out what customers wanted and build a product or service around their wants and desires. Price Vs Cost: He took into a very important consideration that cost may be reflected in the customers view, not only in monetary terms but for example in the case of a cinema, driving to the cinema, the mental debate of whether or not to watch a horror film and its impact on the persons dreams and so on. He factored many other considerations into the cost of a purchase decision rather that merely taking into account the cost of production from the organizations point of view. Place Vs Convenience: He examined the component of convenience against place of delivery. In the service sector location is key, however it may be more suitable to study in a college of less repute in an area that more convenient. Promotion Vs Communication: He argued that promotion was manipulative whilst communication was interactive and personal and that a shift in focus from the four Ps to the four Cs would change customers perceptions and make business more successful. Pricewaterhouse Coopers 2000 classified communication into four main categories. 1. 2. 3. 4. Mass communication Communication per market segment Direct marketing Person specific communication.

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(Wilson, 2008) pointed out that much of the difference between customer perceptions and their expectations could be called the customer gap. He attributed four factors that influence a customer gap namely 1. 2. 3. 4. Not knowing what customers expect Not selecting the right service designs and standards Not delivering to service design and standards Not matching performance to promises

Reflecting on (Gummessons, 2002) view of four impacts on relationship marketing the author has compared the customer gap to apparent solutions provided by Gummesson. Wilsons 4 attributes of the customer gap Gummessons 4 steps to total relationship marketing Not knowing what customers expect Differentiate customers by their values and needs Not selecting the right service designs and standards Not delivering to service design and standards Identify customers and establish how they can be reached. Customize, treat every customer as an individual through personal contact Not matching performance to promises Make the relationship a learning relationship and set in place SERVQUAL standards.

While considering relationship marketing one must not ignore the importance of stakeholders, (Polonsky, 2005). The author depicts the different customer markets through Paynes Six markets model as depicted below. Each market represents stakeholders who have29 | P a g e

their own perceptions of service or financial value which is relative to industry standards, cultural beliefs and personal ideas.

Paynes Six Market model 2.6

1. customer markets (including existing and prospective students as well as agents) 2. referral markets (these include two main categories existing students who recommend the college to others, and referral sources, or multipliers, such as an accommodation agency in London who may refer students to study with us) 3. influencer markets (which included shareholders, the business press, the government, and consumer groups) 4. employee markets (concerned with attracting the right employees to the organisation);

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5. supplier markets (these include traditional suppliers as well as organisations with which the firms has some form of strategic alliance) 6. internal markets (the organisation including internal departments and staff)

The author recommends a synthesis of Paynes six market as well as Gummessons views confirmed by the research carried out through the questionnaire inviting answers on who the college staff considered as the customers of Cavendish College. This would lay a foundation into making recommendations. Gummessons Differentiate customers by their values and needs Payne Identify the customers (Internal and external) Recommended model Once we have identified the customers and divided them into internal or external we need to establish their values. Identify customers and establish how they can be reached. Once we have divided the markets into the 6 categories we establish a communication channel Each category (6) will have a designed person to manage the relation and a structure created in order to ensure that the role is not person specific i.e. If the employee who manages agents leaves the company, then the relationship shouldnt terminate or move with him.

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Customize, treat every customer as an individual through personal contact Make the relationship a learning relationship and set in place SERVQUAL standards.

-

This will be executed through the designated person above

-

This will be executed through the designated person above

Understanding the customers mind is imperative when formulating any marketing strategy or quality management system. (Denton and Brown, 2010), point of seven factors that influence a students choice when applying to colleges. 1. Credibility and reputation 2. Assessment, learning and teaching approach 3. Holistic student experience 4. Corporate culture 5. Portfolio expertise 6. Location 7. Their culture, customs tradition and country of origin. Please see customer relationship marketing and International relationship marketing for an understanding of the importance of taking into account the employees cultural background when formulating a customer relationship management strategy. 8. Others They elaborated to include that the 1990s saw sustainability as a key value to an institutions profile, today it is the brand facet. (Scott, Lasker and Burtscher, 2007) foresee a similar

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trend as American universities now in England, which is most universities and colleges will attract and seek support staff who are capable of fulfilling the profile raising role of stimulating and developing public debate.

2.7 Customer relationship management: Customer relationship management is a discipline that covers all the elements needed to build successful relationships with customers, (Kincaid, 2003). Customer relationship management is now critical to managing long term cyclical marketing activity in higher education (Denton and Brown, 2010). Relationship marketing refers to all marketing activities directed toward establishing, developing and maintaining successful relational exchanges, (Morgan and Hunt, 1994). The above definitions speak of a discipline or process that seeks to manage the stakeholders depicted in Paynes six market model. One major benefit of managing relationships between internal and external customer is gathering useful information into the perceptions insights and requirements of a stakeholder. In this way the College can constantly adapt to external influences and keep abreast of the constantly changing customer behaviour, thereby being able to anticipate needs and act upon failures and weaknesses in order to ensure its sustainability and ensure customer delight. Research carried out through the questionnaire seeks to find out what facets of services currently provided by the college do the students hold important. Drawing upon the description of value one can perhaps understand better how what a student values in terms of services can affect his service experience. This experience will ultimately result in him being a satisfied customer, a delighted customer or an unsatisfied one.

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2.8 Origin and theories of customer relationship management: Traditional markets grew out of the inset of mass produced consumer goods, (Godson, 2009). (Gronroos, 2007) pointed out and criticized the four P approach to marketing saying What worked in 1960s America is not necessarily going to work in markets today. Further development of the 4 Ps were the seven Ps by Boom and Bitner. A majority of the new approaches included the element of human relationships which the tradionalist view overlooked (Godson, 2009). (Gummesson, 1987) concluded that traditional marketing has not evolved and indicated nine issues to challenge traditional marketing (see table below). Thus, the weaknesses of traditional marketing models heralded a new area marketing. Organizations started looking at marketing through a different lens and applied new relationship drivers to boost sales, sustainability and profits through customer relationship management

2.9 Customer relationship management and International relationship marketing: In an expanding market base which has a range of internal and external customers worldwide customer relationship management must look at the holistic view of customer relationship marketing which manages relationships cross culturally. To enable relations to develop successfully, it is necessary to understand the values, expectations and motivations of all executives involved. Thus, successful inter-cultural business relationships are heavily dependent on understanding cultural backgrounds, (Morosini, 1998). Culture is defined as a universal orientation system typical for a society, organization or group. This orientation system is created from specific symbols relevant to the society or group in question and is handed down from generation to generation. It influences the way in which its members perceive, think, value and act and thus defines their membership within that society (Thomas, 1996)

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Organizational culture is defined as the shared values and meanings its members hold in common, which are articulated and practiced by an organizations leaders (Weiss, 2009). Every country and every civilization is subject to its own set of beliefs, languages, customs and traditions. Understanding each cultural background is imperative in the process of relationship management especially in an International environment. Often organizations do not take into account cultural differentiations when applying merger and acquisitions strategies or expansion. (Ford, 1987) indicated that companies do differ culturally and this plays a significant role in managing people. Empirical studies carried on by (Johanson and Wiedersheim-Paul, 1975) shortlisted culture, politics and levels of education as key determinants in a phenomenon called psychic distance. Although originally coined by Beckerman in 1956 they defined it as 'factors preventing or disturbing the flow of information between firm and [foreign] market'. The implication on managing relations between Cavendish College and its international agents involves taking into account cultural differences and maximizing trust (character based and process based trust) as well as reducing the psychic distance through customer relationship management. The nine issues presented by (Gummesson, 1987) challenge traditional marketing and its relevance in 2010 because of the evolutionary nature of customer perceptions, relative value and other factors explained in the table overleaf.

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1. The many headed customer and the many headed seller Indicating that marketing today involved complex networks of relationships between customers, some present, some overseas, some within an organization, others external. Each one having their own perceptions experiences, expectations and demands.

2. The real customer does not always appear in the market place Sometimes the approval of an external party is required in order to conduct a sale. I.e. UKBA new rules TIER 4 Sponsor. 3. The customer as co-producer There is a two way relation between the customer and the producer wherein customers participation is sometimes required, i.e. students who have the capacity and intention to study a course. 4. Market mechanisms are controlled mechanically He pointed out that traditional marketing can be undone by webs of friendships, networks and memberships of clubs and so on. This indicates the referral markets spoken of in Paynes six market model. 5. Market mechanisms are brought inside the company Raises the issue of internal buyers and sellers. 6. Inter-functional dependency The idea that everyone in the organization plays a role in customer satisfaction 7. Process management and the internal customer He said that internal customers must play a significant role. Every department is a customer of another department. For example a college that has a sales team who makes commitments to prospective students about a CAS (Confirmation of acceptance of studies) letter being issued to them in three working days must liaise with the admissions and academics to fulfil that commitment. Hence the responsibility of the academics and admissions is to their customer who is the sales, as well as the final customer.

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8. Internal marketing Organizations marketing efforts should not only be directed externally but internally too. 9. Relationship quality Reflects how skilled handling of the buyer and seller changes customer perception of quality.

Adaptations of Gummessons nine issues into a Relationship model indicated four main areas where exchanges took place. These exchanges/ relationships affect the organizations customer orientation, (Godson, 2009), see figure below. What is even more interesting is that Gummessons views are reflected by Paynes six market model and clearly now, identifies the importance of the following 1. The importance of Internal marketing 2. The importance of adopting a culture or attitude of service 3. The internalization of customers and responsibility resting with every department acting as a whole 4. The importance of relationship marketing through the organization, internal and external.

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Supplier Partnership Goods Service

Internal Partnerships Employees Functional departments Internal business units

FIRM

External Partnerships Competition Government Alliances

Customer Partnership Intermediate customer Final customer

Relational exchanges that affect an organizations customer orientation, (Godson, 2009)

2.10 Impact of relationship management on sales: (Raab, Ajami, Gargeya and Goddard, 2008). 1. Every satisfied customer brings in at least three new customers 2. Unhappy customers express their feelings to ten potential customers 3. The rate of repeat sales increases when improved reliance and satisfaction increases 4. Regular customers exhibit less price sensitivity than new customers 5. Customer oriented companies can charge higher than competition 6. Marketing and sales costs for maintaining customer relationships drops 7. Reducing the level of dropouts can raise profits by as much as 85% (Topfer, 1996)

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(Levitt, 1983) and (Dwyer, 1987) see five stages of customer relationship management whilst (Scanzoni, 1971) amalgamates them into three stages. (Georgi, 2006) however illustrates the lifecycle in a concise easy to understand growth phase much life that of a product. The customer relationship lifecycle below shows the phases of growth from acquisition to recovery or dissolution. (Georgi, 2006)

Intensity of customer relationship

Customer recovery

Customer retention

Customer acquisition

Duration of customer relation

Customer relationship lifecycle- (Georgi , 2006)

The customer acquisitions stage seeks to reduce any uncertainties associated with the product, processes and perceptions. Here the importance of communication such as the web, and other tools plays a key role especially when it comes to international customers who cannot be physically present during the time of purchase. The internet or World Wide Web can be a powerful ally or dangerous threat when it comes to bridging the customer gap and disseminating information. George Masters a user of the Apple IPod created a short animated39 | P a g e

advert at home to the tune of Tiny Machine, by the Darling Buds an 80s pop band. The ad was a series of colours, visual animated imagery and kaleidoscope colours. For several weeks the ad went unnoticed until it was picked up by a blog and the ratings went viral. With more than half a million views in a span of six months the video created more buzz in the online community than any of Apples mainstream commercials. Thus, indicating that the internet can be a powerful tool when considering a marketing campaign. Sites such as Facebook and twitter can be employed to keep students and agents posted on recent events, updates and future plans. Customer retention- focuses on alignment and emotional connections. This may be between the college and the agent or the college and the student or the agent and the student. (Denton and Brown, 2010) speak about the phenomenon of Disintermediation which is when stakeholders become so remote from the organization that positive and mutually beneficial relationships are compromised. He elaborates, Stakeholders crave person to person communication. In fact one interesting point made by Brown is that stakeholders may not necessarily be concerned with the competition, in quite contrast they may be looking for attention and motivation from within the organization. The issue of student retention in the UK is gaining increasing importance with upto 17% increase in drop outs, (Christie, 2004). The reason why students drop out relate to experiences in social and academic integration, (Tinto, 1994).

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2.11 CRM drivers: (Kincaid, 2003) 1. Market drivers- Competition, standardization, pricing strategy, saturation and maturity of markets 2. Customer drivers-End of mass customization and growing importance of one to one relationships 3. Business drivers-The acquisition of new customers is far more costly that maintaining existing ones. The profitability of loyal customers can be gauged through the revenue earned from referrals and recommendations. 4. Technological drivers-New offices, outsourcing recruitment, new IT systems, the Internet etc...

2.12 Internal marketing: The notion that internal relationships are every bit as important to the organisations external customer relations is intuitively sound and is recognised widely within the relationship marketing literature, (Morgan & Hunt, 1994). The major premise of internal marketing according to (Ahmed and Rafiq, 2002) is that to have satisfied customers the firm must have satisfied employees. Gummesson draws on the Process focused internal marketing approach which says that internal marketing is concerned with the internal customer where every member is both a supplier and customer of other employees, (Gummesson, 1987). The current approach of Cavendish College is traditional which separates all the departments furthermore there is a tendency to alienate marketing from the core values of company. (Denison and McDonald, 1995) proposed that organizations can no longer afford to isolate marketing from the rest of the firm. They say that customer centricity should be a philosophy running through the veins of all departments, reflecting on a common thread that connects the whole organization, much like a human body performing all the functions required to achieve an instruction set by the brain. Using the similar analogy, the41 | P a g e

author would like to shed some light on a study carried out by Professor Bruce Lipton. Dr Lipton a cellular biologist noticed that human cells responded more to environmental stimuli rather that DNA programming as conventional sciences propounds. His study indicated that similarly pupils in his medical class had better test scores when they worked as a team i.e. the strong helping the weak etc... His conclusion was that human beings tend to perform better when connected by a common purpose and goal. This perhaps is another indicator of the importance of the entire organization working towards a common objective keeping the tenet of customer service in mind. See customer relationship marketing and Paynes six markets model to verify the importance of identifying an internal customer, internal marketing and relationship management as a system in order to manage these stakeholders.

2.13 The role of third party intermediaries and educational agents: A third party is a company that provides multiple logistics services for its customers, whereby the Third-party logistics provider is external to the customer company and is compensated for its services. (Langley, 1999) where Logistics as defined by the Council of Logistics Management is that part of the supply chain process that plans, implements, and controls the efficient, effective forward and reverse flow and storage of goods, services, and related information between the point of origin and the point of consumption in order to meet customers' requirements. In the case of an educational institution in the UK such as Cavendish College, there is an ever increasing reliance on third party intermediaries or educational agents to recruit students from overseas. A course that normally costs 3900 for a European student at Cavendish College costs 6000 for an international student indicating the revenue earned through marketing the college to overseas students. Research carried out by the independent (Morris and Russel, 2007) estimated that overseas students boost the UK economy by 8 billion a year. Much of the foreign applications come via educational agents. Many of these agents work in tandem

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with the British council as trusted partners in their home country offering valuable advice and guidance to students intending to pursue higher education in the United Kingdom. In exchange for the business Universities and colleges offer the agents upto 20% of fees by way of a commission and incentive to generate more business. Over 70% of Cavendish College students are international of which a vast majority are from outside the EU from countries such as India, Pakistan, Sri Lanka, China, Korea, Japan, Philippines, Russia, Nigeria, Mauritius and others. Without its network of agents in these countries Cavendish College would find it impossible to compete with other private colleges in the same sector. The importance of relationship management with agents is depicted by the diagram below. The importance of relationship management and coordination between agents, employees of Cavendish College and management can be depicted with the help of the services marketing triangle. 2.14 The services marketing triangle

Cavendish College (Company management)

Internal marketing Enabling promises

External marketing Making promises

Staff Keeping promises

Agents Interactive marketing

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The services marketing triangle identifies three key players that are essential to ensure the success of a service offering, (Strydom, 1998). 2.15 Diagramatic representation of Relationship manager, agent and Cavendish students.

Relationship manager

Flow of Information

Feedback

Flow of Information Prospective and current students

Feedback

Agent or third party intermediary

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The BRIC Markets Brazil Russia India and China are markets that represent the forefront of economic recovery. (Reuters). Dubbed BRIC by analysts at Goldman Sachs, it is estimated that by 2011 BRICS will account for 13% of global sales (Reuters). The countries are emerging and promise great value. Although different in landscape, infrastructure, regulation and consumer taste, the key driver to economic promise which is a common similarity is what classical economists refer to as flexible labour laws, which in effect means that the lack of mature labour unions, high population and therefore a larger workforce would decrease the cost of production inviting manufacture and Industry. Russia The Glasnost political idealism of Gorbachaev remained a fantasy that never was realized. (Herspring, 2007) With the collapse of the USSR a huge void of economic and political power opened up a Pandoras Box in post soviet Russia. Young entrepreneurs welcomed the shift of power from the state to key wealthy individuals who formed informal networks of power and control. These relationships that were forged post communism echoed across the globe and made their presence felt in many developed countries through investment in real estate and crime. The effect on the country however was more devastating. A recent study by OECD (Organization for Economic Development) into Russias investment policies indicated that there were 42 sectors which hampered foreign direct investment. Obstacles to investing in Russia are the highest in the World, (Yergin and Gustafson, 2010). With Putin brave display of an open FDI policy to the world slamming foreign Oligarchs for not investing enough in the Russian power infrastructure (which is privatized); it is apparent though that he is playing with a weak hand. (Le Houerou, 1996), says that investment policy in Russian capital markets are underdeveloped and characterized by low volume of security transactions,

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low commercial long term credit and lack of private long term finance. Research carried out by the Wilson centre conveys a gloomy picture of the Russian education system as well, claiming that Russia spends less, percentage-wise of its GDP on education than any other industrialized nation and that the current education system serves only the top 20% of society, (Koehn, 2010). Russia has four types of educational institutions. 1. Universities 2. Academies 3. Institutes 4. Private Institutes There are currently around 1000 Higher education institutions in Russia of which 655 are state owned. (Russian higher education school of economics, 2010) Damning information obtained from US consensus bureau (Nationmaster 2010) gives us the following demographic statistics of the current target market of youth in Russia. Current Population: 141.9 Million of which in the year 2010 there are 17 million youth aged between the years of 15 and 30, however by the year 2020 the numbers between the same age group will fall to 11 million.

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Brazil Brazil is one of the last countries to enter the recession and one of the first to emerge thank to a robust macroeconomic strategy and strong fiscal policies.(Economic Times, April 2009) Finance minister Guido Mantega says that he forecasts and expansion of the GDP by 4% by the year end 2010. (Reuters, April 2010). Although this very large country offers promise to foreign investors the hint of post colonialism and a struggling nation still makes its presence noticeable through careful analysis of overall development. Many economists argue that the very nature of development is characterized by pockets of under and over development (Kreinin and Plummer, 2002) however Brazil still has 26% who live below the poverty line, (CIA 2009). The government encourages industrial development and foreign investment yet in the educational sector the lack of student loans, financial instruments and incentives make Brazil a difficult market for a short term investment. The macroeconomic policies are designed for foreign investors not to have any exit strategies and therefore look at long term gains. According to (Schwartzmann, 1997) no private educational institution has declared itself as profit making. Perhaps this is due to four major instruments that interfere with foreign accreditation. The bodies are:1. Exame Nacional de Cursos 2. Expert evaluation committee 3. Provao, or the National consensus of higher education 4. The Brazil council of education which controls initial approval to operate as a university or college, course and study programmes and even puts a ceiling on course fees. This may be seen as a good thing as then students may look overseas for education; however the lack of financial instruments hampers this.

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A study by the Language travel magazine, October 2008 issue indicated that the UK came seventh in a choice to study abroad with Canada and the United States of America coming first and second respectively. Research carried out by the same body indicated that 54% of recruitment of students was through word of mouth which reinforces the long term approach to establishing a brand and creating brand awareness for Cavendish College or any foreign investor. China With a population of over 1.3 billion (World Development Agency 2010), China ranks the highest amongst overseas students coming to the UK to pursue higher education, (Mackie, 2009). The Telegraph in September 2009 published that there are over 75,000 Chinese students in the UK with over 3,500 coming in every year, (Telegraph; Beckford, 2009). With its large geographical area and immense market capacity investors are eagerly looking at China as a serious contender in overseas BRIC investment, (Reuters, 2008). It comes as no surprise to curious investors though that China has always maintained its own set of autonomous rules when it comes to foreigners. Rules that may be swayed in favour of Chinese companies in the guise of protectionist policies. A recent example of this was the row with internet giant Google over a censorship issue which eventually forced the American giant to introduce a new search engine www.google.cn. A move that was described by Andrew McLaughlin, senior policy counsel at Google as a hard compromise. There is a saying among economic circles that the Great Wall of China now bears a different significance. Not one of keeping invaders out, but rather containing their own citizens. The OECD (organization for economic development) states that amongst a hoard of obstacles in foreign investment the lack of transparency for state owned or localized business coupled with foreign ownership restriction makes life very difficult for anyone looking at China as an48 | P a g e

investment playground. Far from the ethical considerations of prison labour and the lack of freedom of speech, more relevant to the education sector it is important to address the law that dictates that foreign universities and colleges may only set up non profit operations. In addition to this stipulation, the company must be a joint venture with a Chinese university and that all courses, content must be localized and all information regulated by an external authority and the state, (National state estimate on foreign barriers, 2006). The recent points based system required students to have an English proficiency before they come to England will seriously affect Chinese students more than their Indian counterparts due to a) The lack of access to western media. b) The use of Mandarin as a language medium in all schools c) The absences of western schools or colleges In contrast it can be argued that there are a large number of institutions providing English language training in China however as compared to India which was a British Colony for over 400 years, an average of 80% of higher education (A level) and graduate schools employ English as a teaching language medium (Venkatraman, 2009) which puts the latter in a far better position to respond to the legal stipulation. India It is important to note that education plays a very significant cultural role in India. Early records followed by (Sharma and Sharma, 2000) infer that an education system in India can be traced back to the Vedic period (1500-600 BC). The presence of Gurukulas or teachers domain where students learned religion, hunting, music and other life skills give us an insight into the importance of education in the fabric of the Indian psychology. It was many years later with the arrival of the East India Company that Sir Warren Hastings laid a foundation for the first British educational institution in Calcutta in 1780.49 | P a g e

An economic analysis of the GDP (Gross domestic product) of India by (Mozoomdar, 2002) indicates a growth rate of India at an average 5.5% however the World Bank and the Indian economics and statistics bureau (ISB, 2009) indicates an average GDP of 7%. These figures along with several other indicators point towards significant growth potential in the subcontinent. India accounts for one fourth of the global portfolio flows to emerging market economies apart from being the worlds largest outsourcing destination. India is poised for an economic takeoff. (Purfield and Schiff, 2006). In spite all the positive signs and deregulation and economic reforms post 1990s India still has a long way to go to offer investors a secure Investment. A study carried out by KPMG published in the trade and investment opportunities journal with India by Great Britain: Parliament: House of Commons: Trade and Industry Committee reflects that many UK companies are averse to investing in developing countries in spite of the opportunity and the British Chamber of Commerce told us that firms were more likely to focus on markets closer to home. An example of an investment opportunity in India was the telecommunication licences that were open to International and UK investors who restrained from doing so and recently found out that the corruption scandal that estimated 15 billion dollars was a result of Indian politicians undervaluing the licences and pre-selling them to local buyers. (expressindia.com). Hence we see any scepticism is justifiable, however... India has replaced the United States of America as the second largest investment destination for FDI, (Chaze, 2006). Statistics revealed by the Times of India in February 2010 revealed that 30% of the migrants that come to Britain do so on student VISAS of which over 50,000 are Indian. In the view of the upcoming elections there has been a clampdown by the UKBA on student VISAS. Indian and Chinese students will be amongst those who will be hit hard as part of the new points based system introduced in February 2010 requiring students to have a preset English proficiency depending on which course they apply for. Apart from restrictions on spouse and50 | P a g e

dependant VISAS it will restrict what the home office calls bogus students from entering the UK and put restrictions on part time work. As many as 60 colleges have been recently suspended by the UKBA on different grounds. However, with a population of over 1.1 billion (world development agency), a rapidly increasing middle class, growing population, low barriers to Foreign direct investment(as compared to other BRIC countries), availability of long and short term credit instruments to individuals and organizations makes India a serious contender in the global market. A critical analysis of relationship drivers with existing and new agents as well current relational strategies including high customer acquisition costs, high exit barriers, sustainable competitive advantage, trust and commitment, risks, perceived need for closeness and customer satisfaction as relationship drivers (Egan, 2001) will form a skeleton for the analysis of our existing strategy and intended strategy to improve recruitment of quality students from India.

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2.17 The CRUZ Model is an amalgamation of Paynes six market model which identifies the stakeholders of Cavendish College and incorporates the service marketing triangle philosophy of commitment to service running throughout the organization.

Right Person for the right job It is the role and responsibility of the Director and Principal and management to ensure employee motivation is high, recruitment and promotion procedures are fair and monetary and non monetary incentives are introduced.

Employee Markets

Current students Their parents and relatives Multipliers: Accommodation agencies, travel agencies, Gyms etc...

UKBA BAC Study UK

Referral Markets Influencer Markets

Customer Markets

Students

Internal Markets

Supplier Markets

Departments Finance Academics Admissions Interactive Marketing IT Marketing and Sales Maintenance

Agents 52 | P a g e

Chapter III Research Methodology

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3.1 Introduction The purpose behind this chapter is the following: 1. Provide a rationale behind his choice of research philosophy in contrast with other approaches 2. Introduce his sampling instrument 3. Elaborate on rationale behind the survey questions 4. Deliver the findings

3.2 Selection of research philosophy 1. Positivist 2. Interpretive 3. Action 4. Phenomenological 5. Qualitative 6. Quantitative (Levin, 1988) believes that reality is stable and can only be observed from an objective viewpoint. Postivists believe in the replication of results which can infer that the results are accurate. The positivist approach is ingrained in our academic circle and often work which is not follow positivist referencing is not taken seriously. This is indicated by (Hirschheim, 1985) who says, "Positivism has a long and rich historical tradition. It is so embedded in our society that knowledge claims not grounded in positivist thought are simply dismissed as ascientific and therefore invalid". The Interpretivist research as explain by (Cryer, 2006) is similar to an observer point of view of a crime. There are many criticisms of this approach and yet circumstantial evidence may in many cases point towards an accurate representation of reality. Reality again according to interpretivists is often descriptive according to Cryer and spoken from a particular point of view through experience. (See table below).

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The rationale behind using either method often depends on the research question and topic. The author employs both approaches given the fact that strengths from either can be applied to his research question. (Silverman 1993) suggests that it is next to impossible to rely on empirical data alone as concerns are raised into the authenticity of the observer, the situation and the methods of recording the information at the time of it occurring. On the other hand criticisms raised by (Kuhn, 1992) reflected by (Monarch, 2006) sheds light on the ephemeral nature of scientific findings and how what may be considered truth or reality at a certain point in time may as well be fiction. Having said this, one must consider various weaknesses of both approaches in order to make a conclusive decision on which is more accurate and yet (Benbasat, 1987) has observed that no research is better than the other. In order to measure the level of employee morale of Cavendish College the researcher as relied on anonymous quantitative survey questions one of which is the length of tenure the staff see themselves working for the company and to add to this he also reflects on his personal experience and informal conversations with the staff over the past five years. Research methodology also includes the Action research approach where the author seeks to reinforce theoretical data reviewed in the literature review by a practical application. An example of this is creating an online Facebook group for students to socialize, network and build a Cavendish community. He believes that only an interprevist philosophy can correctly gauge the way the target group reacts to the idea of a social online platform stemming from a physical reality i.e. Cavendish College. In other words Facebook being an informal community student are perceived to be more honest with their opinions and the fact that the one hundred and sixty three members have joined the group signifies that they have a desire to be part of a special Cavendish society. The researcher then used the social networking site Facebook as a platform to advertise his survey and invite responses. Having been a student at the college the researcher

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also employs phenomenological research techniques in order to understand the views of the staff and students to answer his research question. The difference between the two research approaches is highlighted by Jorgen Sandberg in this table below. Metatheoretical Assumptions About Ontology Positivism Interpretivism

Person (researcher) and reality are separate.

Epistemology

Research Object

Method Theory of Truth

Validity Reliability

Person (researcher) and reality are inseparable (life-world). Objective reality exists Knowledge of the world is beyond the human mind. intentionally constituted through a persons lived experience. Research object has Research object is inherent qualities that exist interpreted in independently of the light of meaning structure researcher. of persons (researchers) lived experience. Statistics, content Hermeneutics, analysis. phenomenology, etc. Correspondence theory of Truth as intentional truth: fulfilment: one-to-one mapping interpretations of research between research object match lived statements and reality. experience of object. Certainty: data truly Defensible knowledge measures reality. claims. Reliability: research Interpretive awareness: results can be reproduced. researchers recognize and address implications of their subjectivity.

.

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3.3 Re statement of research question and objective The research carried out is an investigation into Relationship management and whether employing relationship management strategies can directly influence sales. In the event of the research positively indicating that relationship management does influence sales the objective is to employ a new strategy to improve the quality and quantity of students as well as improve the morale of staff and third party intermediaries as a subsequent benefit. 3.4 Data Analysis The research requires that a wide range of students both past and present, be targeted. The researcher found out after initial pilot research that students gave a biased view when being in the presence of the researcher. Perhaps this was due to the fact that he was employed by the organization and many respondents felt that he would perhaps read the questionnaire soon after they had filled it up even though there was no name column on it. Many students who were approached are currently waiting for their results and had a perception that negative views expressed may affect their grade. In the light of these concerns it was decided to approach the students in a more informal environment. Facebook was the ideal platform as the researcher used it to also gather phenomenological research conclusions through observations of group behaviour over the last academic year. The researcher posted the survey link on the Cavendish College group page as well as messaged each of the one hundred and sixty three members personally. Thirty filled out the survey. These thirty are from a diverse range of courses from creative to more popular business courses. Below each table you will find a rationale behind the question.

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1. What course have you completed? STUDENT QUESTIONNAIRE

answered question

30

skipped question

0

Response Count 30

Rationale: the question was raised in order to get opinions of students from a cross section of departments.

2. How did you hear about Cavendish College London?

answered question

30

skipped question

0

Response Percent

Response Count

Agent

40.0%

12

Friend

20.0%

6

Internet

30.0%

9

Other

10.0%

3

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2. How did you hear about Cavendish College London?

Other (please specify)

3

1.

TV

2.

Moroccan fair

3.

Family

Rationale: The question was raised in order to ascertain which the highest source for recruitment was. As agents emerge as the highest source of students the college needs to pay special attention in order to furnish them with the correct information. The next question indicates areas in which students were briefed pre-arrival. Pre-arrival information is a pre requisite for any college seeking to recruit international students enforced by the British Accreditation Council (BAC). This is also an indicator of which channels of marketing are successful.

3. Were you briefed on the following subject areas by your agents?

Yes

No

Brief overview Rating Average Response Count

Fees (transparency) Accommodation and living expenses Facilities Course content Location

76.7% (23)

13.3% (4)

10.0% (3)

1.33

30

53.3% (16)

36.7% (11)

10.0% (3)

1.57

30

36.7% (11) 50.0% (15) 73.3% (22)

46.7% (14) 26.7% (8) 16.7% (5)

16.7% (5) 23.3% (7) 10.0% (3)

1.80 1.73 1.37

30 30 30

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3. Were you briefed on the following subject areas by your agents?

Teaching staff Academic progression Nationality of other students Employment opportunities Student services

30.0% (9)

50.0% (15)

20.0% (6)

1.90

30

40.0% (12)

46.7% (14)

13.3% (4)

1.73

30

23.3% (7)

63.3% (19)

13.3% (4)

1.90

30

16.7% (5)

63.3% (19)

20.0% (6)

2.03

30

26.7% (8)

60.0% (18)

13.3% (4)

1.87

30

Rationale: The purpose of this question was to identify areas of information lapse. With a view to shortening the customer gap this information will eventually contribute to helping them obtain a realistic perception of student life in the United Kingdom as well as have a clear career plan. The survey indicated that upto sixty percent of students did not receive vital information on employment opportunities, student services, nationality of other students and academic progressions. All these factors play an important role in the career planning and60 | P a g e

development of an individuals life and yet they have been ignored. For example, seeking employment as a student is important as it is a source of income to sustain oneself whilst studying. Without this many students will have to rely on loans or grants which often weigh down heavily on the decision to complete their studies. In addition, the college provides very limited extracurricular activities and rely on the students to organize events amongst themselves. Many students found that the high percentage of certain nationalities would factor into their decision if they had to recommend the college to another friend or relative. Lapse in information or incorrect information affects the process based trust element of a customer client relationship thereby raising questions in the customers mind about the entire purchase experience. The fundamental principle behind the service marketing triangle is to enable the promises that are made to the customer by the intermediaries. The indications from the results above are that there is a massive shortfall in correct information resulting in the college being unable to deliver on the commitments made by the agents.

4. Was the information provided to you pre-arrival accurate?

Response Percent

Response Count

Yes

40.0%

12

No

20.0%

6

Some of it

40.0%

12

Please explain further

3

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4. Was the information provided to you pre-arrival accurate?

1.

This question is a bit tough. The answer is somewhat, but there are no other options then I am going to choose yes

2.

I did start late though. Plus maybe just can't remember.

3.

Some information was fine but some of it like the nationality of students was not. I did not come to study in London only to be with Indian and Pakistanis and Nigerians. There are no European students in my foundation class and I feel tricked. Also, Facilities etc could have been elaborated.

Rationale: Service quality dimensions mentioned in the literature indicated that Reliability emerged as the most important dimension. The purpose of this question was to indicate the accuracy of the information provided to the students thereby assuring them that they can rely on the information given to them in order to plan ahead. However, much of the information is either outdated or irrelevant thereby negating reliability. Upon arrival when the student realizes the difference between what was told to them and what the reality is, their impressions of the college and its intermediaries will be negative. This will in turn affect their62 | P a g e

relationship with the college. A combined average of sixty percent (No and some of it) indicate that the college must train agents on these matters.

5. Did the experience match your expectations?

Response Percent

Response Count

Yes No

56.7% 43.3%

17 13

Rationale: To estimate the customer gap.

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6. Please rate in order of importance which facet needs to improve?

Critical Importance

Important

Average Importance

Low Importance

N/A Rating Average Response Count

Image and appearance Teaching Quality Administration Student services VISA advice Nationality of other students Information on Jobs and accommodation

16.7% (5)

63.3% (19)

10.0% (3)

10.0% (3)

0.0% (0)

2.13

30

16.7% (5)

46.7% (14)

16.7% (5)

13.3% (4)

6.7% (2)

2.29

30

30.0% (9)

36.7% (11)

23.3% (7)

6.7% (2)

3.3% (1)

2.07

30

43.3% (13)

36.7% (11)

16.7% (5)

3.3% (1)

0.0% (0)

1.80

30

46.7% (14)

30.0% (9)

6.7% (2)

3.3% (1)

13.3% (4)

1.62

30

26.7% (8)

20.0% (6)

20.0% (6)

13.3% (4)

20.0% (6)

2.25

30

40.0% (12)

50.0% (15)

3.3% (1)

6.7% (2)

0.0% (0)

1.77

30

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Rationale: In order to establish areas which students felt needed improving. Of the seven areas students selected VISA advice as the highest followed by student services and job and accommodation information. By providing these services the college can help the students settle in comfortably into their educational life. This will have a positive effect on their performance as they understand the structure of job hunting, resume preparation, and other important facets that will contribute to their overall well-being. The lack of information on VISAS costs students thousands of pounds in re-application fees and some waste valuable time having to go back to their country as they lose appeal rights due to basic errors made in their application.

7. How do you feel when you need to approach a staff member for a document or information?

Response Percent

Response Count

Confidant Hesitant Negative

50.0% 30.0% 20.0%

15 9 6

Extract chart from staff Questionnaire

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Rationale: This question seeks to understand the e