Student: Trương Thị Vân Anh

Advisor: PhD. Su Fang Pei

Co-advisor: PhD. Lê Văn Huy

ID: 11752332 – Class: SDMBA1

Email: vananhbiz@yahoo.com

DETERMINANTS OF CUSTOMER DETERMINANTS OF CUSTOMER RELATIONSHIP MANAGEMENT RELATIONSHIP MANAGEMENT

PERFORMANCE IN ELECTRONIC PERFORMANCE IN ELECTRONIC BANKING SERVICES – THE CASE BANKING SERVICES – THE CASE

OF BANKS IN DANANG,OF BANKS IN DANANG,VIETNAMVIETNAM

KEYWORDS

Customer relationship management (CRM)

CRM performanceElectronic banking (e-banking)Vietnam commercial banks

OUTLINE

Introduction1111

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Literature Review

Research methodology

Contribution & Timetable

References

1.1 RESEARCH BACKGROUND

Development of banking systems in Vietnam Development of e-banking: Fierce competition between

banks, especially through e-banking (average transaction cost: 1.07$ - traditional channel, 0.04$ - call/contact center, 0.27$ - ATM, 0.01$ - internet banking alternatively at America) (Vu, 2007)

Future of e-banking in Vietnam: cash payment will be not exceed 18% & 80% transaction number between banks will be through bank system at 2020 (Thoa, 2007)

1.1.1 Electronic banking in Vietnam

1.1 RESEARCH BACKGROUND

The automation of horizontally integrated business processes involving front office customer contact points (marketing, sales, service and support) via multiple, interconnected delivery channels (Metagroup, 2000)

IT enabled business strategy (Gartner group, 2004) Banks deal with individual consumers or customers so they

want CRM for its analytical capability (Buttle, 2004) Be analytical and operational process (Ryter et al., 2001,

Peppers and Rogers, 2004)

1.1.2 Customer Relationship Management

e-banking is one of the most important problem (help banks establish new construction, enhance serving time (Thoa, 2007))

Lack of academic effort addressing the issue of CRM performance

Many people are still confused about actual domain of CRM

No papers conducted about CRM performance in customer view

Individual motive: CRM and e-banking are areas I concerned

My work experiences in bank

1.2 RESEARCH MOTIVES

Define the determinants of CRM performance of e-banking

Determine how these factors strong

Make implications for management of local banks

1.3 RESEARCH PURPOSES

I

I Identify

D Differentiate

Interact

C Customize

Analytical CRM

Operational CRM

2. LITERATURE REVIEW

CRM performance in customer view belongs to effficiency and effectiveness of Operational CRM

CRM process is included customer targeting, enquiry management, customer knowledge, campaign management, managing problems, product logistics (Oztaysi et al., 2011)

Performance is defined as the potential for future success of actions in order to reach the objectives and targets (Lebas, 1995)

CRM performance evaluation metrics are related to customer relationship strength, sales effectiveness, and marketing efficiency (Kim et al., 2004)

CRM implementation also is measured by 4 components: two-way communication, efficiency, employee attitude, and employee knowledge (Rootman, 2006)

2. LITERATURE REVIEW

2.1 CRM performance

2. LITERATURE REVIEW2.1 CRM performance

Conceptual framework(Rootman, 2006)

2. LITERATURE REVIEW

2.1 CRM performance

Variables Items

Bank’s success concern High concern for bank’s success

Confidence Confidence in bank

Strong bond Strong bond with bank

Benefits Receive many benefits

Commitment Committed completely with bank

The information technology that is deployed for the specific purpose of better initiating, maintaining, and/or terminating customer relationships (Bharadwaj et al., 1993)

Technology usage is regarded a key driver of organizational success (Devaraj and Kohli, 2003; Mahmood et al., 2001)

CRM technology usage enable firms to obtain performance gains and include two variables (CRM system usage, support through CRM system) (Greve and Albers, 2006)

Collaborative CRM technology belongs to analytical CRM and be understood as types of electronic banking services

2. LITERATURE REVIEW

2.2 Collaborative CRM technology

2. LITERATURE REVIEWCRM value generation process (Keramati et al., 2010)

2. LITERATURE REVIEW

2.2 Collaborative CRM technology

Variables Items

ATM Using automated teller machine

POS Using payment cards at point of sales

Telephone banking Using telephone banking service

Mobile banking Using mobile banking service

Call center Using call center service

Internet banking Using internet banking service

Communication is the delivering of a message or information, through various means, from one individual or group to another (Dodd, 2004;Joiner, 1994)

Communication is a human activity that connects people and creates relationships between them. Firms can make use of effective communication to shape client relationships (Swartz and Iacobucci, 2000)

Two-way communication occurs when firms listen to their consumers, and with better interaction between consumers and firms (Mudie & Cottam, 1999; Duncan and Moriarty, 1998)

2. LITERATURE REVIEW

2.4 Two way communication

2. LITERATURE REVIEW

2.4 Two way communication

Variables Items

Account statement Receiving account statements from bank

Media Receiving banking information through various media regularly

Senior managersSenior managers are always available for appointments with customers when necessary

Communicate Employees communicate effectively

Meeting Being invited to client meeting

Available Receive information if certain services will be available

Customization goes beyond communicating with customers and is also about the creation of products for individuals (Rootman, 2006)

Customization is about the creation of products and services based on each customer's taste (Winer, 2001)

Customization is also belongs to operational CRM (Peppers and Rogers, 2004)

2. LITERATURE REVIEW

2.5 Customization

2. LITERATURE REVIEWCustomer retention program (Winer, 2001)

2. LITERATURE REVIEW

2.5 Customization

Variables Items

Individual message

Individualization of marketing messages

Services customization

Customization of services

Desired communication

Communicating with customers based on desired way

In paper about performance of personal banking sector, Reed et al. (2009) mentioned social capital factors as independent factors. External social capital shows social relationships existing between employees and clients.

Ali et al. (2006), Ali and Alshawi (2005) also made mention of cultural dimensions framework for the management of CRM systems implementation

In this study, employee-client relationship is developed and also considered as one of cutural dimensions in customer view. Employee-relationship dimension is expected that has positive effect on CRM performance in Vietnam

2. LITERATURE REVIEW

2.6 Employee-client relationship

2. LITERATURE REVIEW

2.6 Employee-client relationship

Variables ItemsParticularism

(Trompenaars, 1993)

Situation-specific relationship obligations and unique circumstances

Emotional Relationship Orientation

(Trompenaars, 1993)

Interactions where emotions is readily expressed

Diffusion Orientation(Trompenaars, 1993)

Business relationships in which private and work encounters are not demarcated and ‘segregated-out’

Regularly visit (Reed et al., 2009)

Employees visit customers regularly

Vist accompanied by managers (Reed et al., 2009)

Employees visit customers accompanied by the bank’s top managers

3. RESEARCH METHODOLOGY3.1 Research model

Collaborative CRM technology

Two way communication

Customer satisfaction

CRM performance

Employee-client relationship

3. RESEARCH METHODOLOGY3.2 Measureming instrument

Dimensions Variables Code

Collaborative CRM technology (6 items)

(by Nili, 2010)

ATMPOSTelephone bankingMobile bankingCall centerInternet banking

ATMPOSTELEMOBICALLIB

2-way communication (6 items)(Rootman, 2006)

Account statementMediaSenior managersCommunicateMeetingAvailable

ACCOMEDIMANACOMMMEETAVAI

3. RESEARCH METHODOLOGY

3.2 Measureming instrument

Dimensions Variables Code

Customization (3 items)(Winer, 2001)

Individual messageServices customizationDesired communication

INDICUSTDESI

Employee-client relationship

ParticularismEmotional relationshipDiffusion Regularly visitVisit accompanied by managers

PARTEMOTDIFFVISITWITH

CRM performance (5 items)(Rootman, 2006)

Bank’s success concernConfidenceStrong bondBenefitsCommitment

SUCCCONFBONDBENECOMM

3. RESEARCH DESIGN

3.3 Sampling

Scale: 5 point scale of Likert Population: customers of electronic banking services in

Vietnam Sample selection: Convenience sampling (no need to

generalize, limited objectives, saving time and cost) Minimum size of sample: 300 Responders: customers of 6 banks in Danang city (based

on number ratio of each bank in Danang city)

3. RESEARCH DESIGN

3.4 Data analysis

Pilot test

Factor analysis

Reliability of the measuring instrument

Mutiple regression analysis

4. CONCLUDING REMARKS

Concluding the determinants of CRM performance in electronic banking services

Providing additional evidence to the growing body of knowledge concerning the importance of achieving the higher level of CRM performance

Explaining the same or difference between CRM performance of electronic banking in Vietnam and these services of other countries

Explaining significant of customer view about relationship between them and their banks

New element (employee-client relationship) in CRM performance research of electronic banking services

4.1 Expected Results and contributions

4. CONCLUDING REMARKS

Tasks Estimated time

Thesis proposal Within August, 2012

Literature review September

Frame of reference October

Data analysis November

Findings December

Conclusion and implication January, 2013

Representation February, 2013

4.2 Current progress and Following Schedule

REFERENCES

Ali M., Brooks L., and Alshawi S. (2006), Cultural dimensions and CRM systems: A cross-cutural study case study

Becker Jan U., Goetz G., and Albers S. (2009), The impact of technological and organizational implementation of CRM on customer acquisition, maintenance, and retention, Internatioanl Journal of Research in Marketing 26, 207–215

Croteau, A.-M. and Li, P., (2003) "Critical Success Factors of CRM Technological Initiatives", Canadian Journal of Administrative Sciences, 20, 1, 21-34.

Grabner-Kraeutera, Sonja, Gernot Moedritscherb, Martin Waigunyc & Werner Mussnigb. (2007). Performance Monitoring of CRM Initiatives. In the 40th Annual Hawaii International Conference on System Sciences, January 3-6, 2007, Hawaii, USA.

Greve G. and Albers S. (2006), Determinants of Performance in Customer relationship management – Assessing the Technology usage – Perfomance link

ICSB (2002), CRM Scan, www.icsb.nl.

Keramati, A, Mehrabi, H & Mojir, N 2010, A process-oriented perspective on customer relationship management and organizational performance: An empirical investigation,‘ Industrial Marketing Management, vol. 39, no. 7, pp. 1170–1185.

Kim, J., Suh, E., & Hwang, H. (2003). A model for evaluating the effectiveness of CRM using the balanced scorecard. Journal of Interactive Marketing, 17(2), 27-28. Mishkin, F. S., (2000), The Economics of Money, Banking, and Financial Markets. 6th ed., Addison Wesley.

Kocoglu D. (2012), Customer relationship management and customer loyalty: A survey in the sector of banking. International Journal of Business nd Social Science, Vol. 3 No. 3, 282-291.

Minami C., J. Dawson (2008). The CRM process in retail and service sector firms in Japan: Loyalty development and financial return, Journal of Retailing and Consumer Services 15, 375-385.

REFERENCES

Mithas, S., Krishnan, M. S., & Fornell, C. (2005). Why Do Customer Relationship Management Applications Affect Customer Satisfaction? American Marketing Association, 69, 201-209.

Nili A. (2010). The impact of CRM on Customer Retention in electronic banking: Case of Iranian banks, Master thesis, Lulea university of Technology

Niraj, R., Gupta, M. and Narasimhan, C. (2001) "Customer Profitability in a Supply Chain", Journal of Marketing, 65, 3, 1-16.

Payne, A., & Frow, P. (2005). A strategic framework for customer relationship management. Journal of Marketing, 69(4), 167-176.

Roh T. H., Cheol Kyung Ahn, Ingoo Han (2005). The priority factor model for customer relationship management system success, Expert Systems with Applications 28, 641-654.

Reed K. K, Srinivasan N., and Doty D. H (2009). Adapting human and social capital to impact performance: some empirical finding from the U.S. personal banking sector, Journal of Managerial Issues Publisher: Pittsburg State University, Vol 21

Reinartz, W., Krafft, M. and Hoyer, W. (2004) "The Customer Relationship Management Process: Its Measurement and Impact on Performance", Journal of Marketing Research, 41(3), 2004, 293-305.

Rootman C. (2006). The influence of customer relationship management on the service quality of banks, The Nelson Mandela Metropolitan university

Ruyter K. De, L. Moorman, and J. Lemmink, “Antecedents of Commitment and Trust in Customer-Supplier Relationships in Technology Markets,” Industrial Marketing Management 30, no. 3 (2001), pp. 271–286.

Trompenaars, F. (1993). Riding the waves of culture: Understanding culture diversity in business, in R., Goodwin (ed.) Personal Relationships Across Cultures (pp. 22-36) Routledge, London.