53-152-3 MANAGING CUSTOMER RELATIONSHIPS - DOC - DOC by ys02ph6v

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									5315203 MANAGING CUSTOMER RELATIONSHIPS
INFORMATION NOTE
MBA – WINTER 2010 - P5 – A01
CASE STUDIES: SOME GUIDELINES

Christian Dussart
Jean Baptiste Fabri



CUSTOMER PROFITABILITY ANALYSIS AND VALUE BASED
MANAGEMENT AT BARCLAYS BANK
(Session 2 – Part 1)

In response to the intensified competition in the banking industry, Barclays adopted a
Value Based Management (VBM) program to align decision making at all levels in the
organization with the interests of its shareholders. Under the umbrella of this VBM
program the Bank introduced a new approach to identifying and effectively managing its
high-value customers. The case shows how the new customer value measurement tool
had a significant impact on managerial decision making and how it was supported by
value-based sales incentives. The purpose of the case is to provide an illustration of
customer profitability analysis in the context of a 'managing for value' initiative at a
leading European bank. The case shows how the Bank's external financial goal of top
quartile shareholder return was translated into an internal focus on economic profit,
which in turn was cascaded to the front line through value-based sales targets. The
objective of the case discussion is to explore the benefits and challenges of adopting a
value-aligned performance measurement tool to help the sales-force identify high-value
customers and take action to boost customer profitability and create shareholder value.

Topics:                   Customer    profitability; Value based   management;
                          Performance management; Business banking

“Prize Winner Case Study”


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PILGRIM BANK (A)
(Session 2 – Part 2)


The Pilgrim Bank case series provides a context in which students can explore
managerial decision making that is critically informed by data analysis. The setting is a
retail bank; the decision making is related to its policy toward on-line banking. The
management team is evaluating whether the bank should charge for access to on-line
banking, provide incentives to use the service, or devise some other policy altogether.
With thousands of customers already using the on-line site, the bank is well positioned to
assess the impact of the service on customer profitability and retention before making
final policy decisions. The case is told from the perspective of a recent MBA graduate
who has been charged coming up with policy recommendations


Topics:                   Banking; Distribution channels; Profitability; Regression
                          analysis; Sampling

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HILTON HOTELS
(Session 3 – Part 2)


This case analyzes the Hilton Hotels Corporation's CRM (customer relationship
management) strategy at a key juncture in its history, immediately after the firm has
been taken private by Blackstone. The case provides students with a a comprehensive
history of the evolution and IT enablers of Hilton's CRM Initiative, as well as the
proprietary OnQ enterprise system. The case thus offers a rare opportunity to engage in
a longitudinal evaluation of the firm's CRM initiative, and to enable students to propose
the future evolution of the initiative based on their analysis.



Topics:                   Customer    relationship   management;      Information
                          management; Information systems; Marketing; Technology
                          management



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PENZOIL-QUAKER STATE CANADA (A) and (B)
(Session 4 – Part 2)

The director of Lubricants business for Pennzoil-Quaker State Canada is faced with a
significant challenge - overcoming the apathy that many consumers had about changing
their motor oil. Increasing the frequency of oil changes and improving retention of its
customers was critical for the financial success of the company. In response to this
challenge, the director had to make a recommendation on adoption and implementation
of a major new promotional program. The program, called One-to-One, was designed to
create closer relationships among consumers, retailers and Pennzoil-Quaker State.
Making the program work required active co-operation from the retail installers who
actually performed the oil changes. The supplement Pennzoil-Quaker State Canada:
The One-To-One Decision (B), product 9B04A011, focuses on the 240-day field trial of
the program.
Topics:                    Marketing communication; Consumer marketing; Sales
                           promotion; Retail marketing


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WAL-MART & TESCO
Benchmarking 2 Mass Distributors
(Session 5)


ABSTRACT #1 (TESCO)

The case describes the customer relationship management (CRM) initiatives undertaken
by Tesco, the number one retailing company in the United Kingdom (UK), since the mid-
1990s. The company's growth and its numerous customer service efforts are discussed.
The case then studies the loyalty card scheme launched by the company in 1995. It
examines how the data generated through this scheme was used to modify the
company's marketing strategies and explores the role played by the scheme in making
Tesco the market leader. The case also takes a look at the various other ways in which
Tesco tried to offer its customers the best possible service. Finally, the company's future
prospects are commented on in light of changing market dynamics, the company's new
strategic game plan, and criticism of loyalty card schemes. The case is structured to
enable students to: (1) understand the concept of CRM and its importance in deriving
advantages in a highly competitive market; (2) study the nature of the retailing industry in
the UK, particularly the evolution of Tesco as a leading company by the end of the
1990s; (3) understand the need for loyalty card schemes, their implementation, and the
role of data mining and analysis in running such schemes successfully; (4) examine how
the information gathered through CRM tools can be used to modify marketing strategies
and the benefits that can be reaped through them; and (5) analyze the various issues
companies need to address when devising a comprehensive CRM system.


Topics #1 (TESCO)

Tesco; UK retailing industry; Customer relationship management; CRM; Loyalty card
schemes; Clubcard; Customer profiling; Sainsbury's; Asda; Dunnhumby; Jack Cohen;
Global expansion; Customer classification; Customer service; Customer delight


ABSTRACT #2 (WAL-MART)

The case discusses various customer-centric initiatives, which contributed to the
success of Wal-Mart, the world's largest retailing company. The case elaborates on the
role of Sam Walton's leadership, Wal- Mart's culture and the customer-centric policies of
the company. The case also discusses in detail how Wal-Mart used IT to provide high
levels of customer service. The case is structured to enable students to: (1) understand
the significance of leadership in instilling customer-orientation among employees; (2)
examine the role of the organisation's culture and philosophies in providing high levels of
customer service; (3) understand the manner in which IT can be effectively used to
supplement the core customer service initiatives of a retailing company; and (4)
understand how companies can deliver customer value and satisfaction by providing
high levels of customer service.


Topics #2 (WAL-MART)

Wal-Mart; Customer service; Customer focus; Sam Walton; Retailing industry; Customer
delight; Customer satisfaction; Customer relationship management; IT for customer
service; Customer-centric culture



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TOKAIBANE IN 2007
Building a Service-Driven Manufacturer
(Session 6 – Part 2)


The case describes how a manufacturing firm in an increasingly commoditized, low-tech
industry has gained sustainable competitive advantage through a focused strategy and a
relationship marketing approach. Whereas the majority of more than 3,000 Japanese
spring manufacturers pursued scale economies, supplying standardized products to
large-scale auto manufacturers and appliance companies, Tokaibane differentiated itself
by focusing only on high-end, custom-made springs in niche markets, such as nuclear
power plants and high-speed machine tools. Tokaibane's distinct strategy, employee-
centered organization, and aggressive IT investment in customer relationship
management (CRM) enabled it to achieve profits for more than sixty consecutive years.
In 2007, exploring opportunities for future growth, Tokaibane management was
contemplating three alternatives: (1) pursue aggressive customer acquisition through
recently upgraded web-based ordering systems; (2) focus on the existing customer base
to further expand customer lifetime value; or (3) go downstream and start offering new
spring-related services to convert itself from a pure manufacturing firm into a more
service-producing organization. The teaching objectives are: (1) to illustrate the
advantages associated with unique positioning and how a company has managed to
decide 'what to do' and 'what not to do'; (2) to assess how a company has defined a
service concept and organized its internal resources to attain outstanding performance;
and (3) to give students practice in considering a management decision, requiring
analysis of various data and verification of the appropriateness of decisions. The case
describes how a manufacturing firm in an increasingly commoditized, low-tech industry
has gained sustainable competitive advantage through a focused strategy and a
relationship marketing approach. Whereas the majority of more than 3,000 Japanese
spring manufacturers pursued scale economies, supplying standardized products to
large-scale auto manufacturers and appliance companies, Tokaibane differentiated itself
by focusing only on high-end, custom-made springs in niche markets, such as nuclear
power plants and high-speed machine tools. Tokaibane's distinct strategy, employee-
centered organization, and aggressive IT investment in customer relationship
management (CRM) enabled it to achieve profits for more than sixty consecutive years.
In 2007, exploring opportunities for future growth, Tokaibane management was
contemplating three alternatives: (1) pursue aggressive customer acquisition through
recently upgraded web-based ordering systems; (2) focus on the existing customer base
to further expand customer lifetime value; or (3) go downstream and start offering new
spring-related services to convert itself from a pure manufacturing firm into a more
service-producing organization. The teaching objectives are: (1) to illustrate the
advantages associated with unique positioning and how a company has managed to
decide 'what to do' and 'what not to do'; (2) to assess how a company has defined a
service concept and organised its internal resources to attain outstanding performance;
and (3) to give students practice in considering a management decision, requiring
analysis of various data and verification of the appropriateness of decisions.



Topics:                  Marketing;    Strategy;    CRM      (customer  relationship
                         management);        Service        management;       Japan;
                         Commoditization; Service for manufacturing; Industry value
                         chain;    Customer     acquisition;   Customer   retention;
                         Satisfaction; Loyalty; Customer lifetime value; Spring
                         industry; B2B (business to business)




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