An Evaluation of Customer Relationship Management in Freight Forwarder by ojd96442

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									Proceedings of the 13th Asia Pacific Management Conference, Melbourne, Australia, 2007, 1096-1105




    An Evaluation of Customer Relationship Management in Freight Forwarder Services
                                         Chin-Shan Lua* and Kuo-chung Shangb*
                                a
                                    Department of Transportation and Communication Management Science,
                                                       National Cheng Kung University
                                          b
                                            Department of Shipping and Transportation Management,
                                                   National Kaohsiung Marine University


Abstract

       This study seeks to expand the base of knowledge concerning customer relationship management (CRM) attributes and their
influence on firm performance, such as profit rate, revenues, growth rate, and market share. This research empirically evaluates
the crucial dimensions of CRM from a freight forwarder’s perspective in Taiwan. Based on factor analysis, six CRM dimensions
are identified: customer acquisition, customer response, customer knowledge, customer information system, customer value
evaluation, and customer information process. Cluster analysis is subsequently performed to form freight forwarder groups.
Respondents are categorized into four groups on the basis of their factor scores in CRM dimensions: customer response oriented
firms, customer knowledge and information process oriented firms, customer information process and response oriented firms, and
customer response and knowledge oriented firms. The results indicate that best financial performance in terms of profit rate and
revenues was found in customer information process and response oriented firms, followed by customer response and knowledge
oriented firms, customer knowledge and information process oriented firms, and customer response oriented firms. The theoretical
and practical implications of the research findings are discussed.

Keywords: Customer relationship management; Freight forwarder services; Factor analysis; Cluster analysis


1. Introduction                                                         changes in industrial processes, leading to stock
                                                                        reductions and a need for more flexible, diverse, rapid
     Customer relationship management (CRM) is a
                                                                        and tailor-made transport, with smaller and more
comprehensive business and marketing strategy that
                                                                        frequent shipments. Stock moved from manufacturers is
integrates technology, process, and all business
                                                                        apportioned among numerous suppliers, consignments
activities around the customers (Anton 1996; Anton and
                                                                        are smaller and their unit value higher, and delivery
Hoeck 2002; Feinberg and Kadam 2002). It is a
                                                                        must be punctual and reliable. To fulfill the
management approach that seeks to create, develop, and
                                                                        requirements of shippers, an integrated transport service
enhance relationships with carefully targeted customers
                                                                        that can provide uninterrupted moves across countries
in order to maximize customer value and corporate
                                                                        and continents is essential. The role of freight
profitability. CRM is often associated with utilizing
                                                                        forwarders is a vital element in the successful
information technology to implement relationship
                                                                        management of international transport issues and the
marketing strategies (Payne and Frow 2004).
                                                                        organization of international transport operations.
      However, previous research has been limited to
                                                                             A freight forwarder or forwarding agent is a
examining CRM in a particular industry, including
                                                                        company or person who arranges the carriage of goods
banking and insurance (Ryals and Payne 2001),
                                                                        and the associated formalities on behalf of a shipper,
television entertainment services (Lemon et al. 2002),
                                                                        which like many industries are becoming more
retailers (Wong and Sohal 2003; Cuthbertson and Laine
                                                                        commoditized. Not only are freight forwarders looking
2004), and financial services companies (Chen and
                                                                        less and less different from one another, but a growing
Ching 2004). There seems to be a lack of empirical
                                                                        range of freight forwarders is providing the same of
studies dedicated to studying CRM in the context of
                                                                        service. The duties of a freight forwarder include
freight forwarders.
                                                                        booking space on a ship, providing all the necessary
    From a transportation perspective, globalization                    documentation and arranging customs clearance
has had an enormous impact, necessitating huge                          (Brodie 1991). In particular, the freight forwarder


Corresponding author.
*
                        E-mail: lucs@mail.ncku.edu.tw


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industry in Taiwan has become highly competitive and                    CRM has also been defined variously as
the percentage of foreign firms in this market has                 “data-driven marketing” (Kutner and Cripps 1997); “a
consistently remained at a high level (Lu 2003).                   management approach that enables organizations to
                                                                   identify, attract and increase retention of profitable
     Numerous previous transport-related studies have
                                                                   customers by managing relationships with them”
explored the relative importance of carriers’ or
                                                                   (Hobby 1999); “an e-commerce application” (Khanna
forwarders’ perceptions of service attributes (e.g.,
                                                                   2001); “a business strategy combined with technology
reliability of sailing, availability of cargo space and
                                                                   to effectively manage the complete customer life-cycle”
on-time pick-up, etc.) in order to provide
                                                                   (Smith 2001); “the development and maintenance of
recommendations to management for improving the
                                                                   long-term mutually beneficial relationships strategically
quality of services (Pearson 1980; Collison 1984;
                                                                   significant customers” (Buttle 2001); and “managerial
Brooks 1990; Mater and Gray 1993; Tengku
                                                                   efforts to manage business interactions with customers
Jamaluddin 1995; Lu 2000, 2003). However, few of
                                                                   by combining business processes and technologies that
these studies have specifically explored CRM attributes
                                                                   seek to understand a company’s customers” (Kim et al.
within the context of their influence on firm
                                                                   2003).
performance.
                                                                        Several studies have examined CRM from the
      While the antecedents of CRM have been widely
                                                                   capability perspective (Plakoyiannaki and Tzokas 2002;
discussed in the relationship marketing-related literature,
                                                                   Payne and Frow 2004; Zablah et al. 2004). The
an understanding of the perceptions of CRM and its
                                                                   capability perspective suggests that effective CRM
relationship with firm performance in the freight
                                                                   represents a potential source of competitive advantage,
forwarder context is lacking. Therefore, this study aims
                                                                   given that it requires an indeterminate, hard-to-imitate
to investigate crucial CRM dimensions, and to classify
                                                                   mix of resources (Grant 1991; Teece et al. 1997). The
freight forwarders into various groups according to
                                                                   capability perspective on CRM highlights the fact that
their CRM perceptions. In particular, differences in firm
                                                                   firms must invest in developing and acquiring a mix of
performance among groups and the relationship
                                                                   resources that enables them to modify their behavior
between CRM dimensions and firm performance are
                                                                   towards individual customers or groups of customers
examined in this study.
                                                                   (Peppers et al. 1999).
     This research is organized into five sections. This
                                                                         It is logical for firms to allocate resources and their
section is an introduction which states the motivation,
                                                                   CRM capabilities as these investments will provide
objective, and organization of the study. The next
                                                                   them with access to different market segments, and
section provides a review of the literature on CRM,
                                                                   hence yield economic returns. This logic suggests that
followed by a discussion of the methodology employed
                                                                   given the differences in their ability to create and
to address the research issues. Then, we present the
                                                                   deploy resources, freight forwarders should differ in
empirical analyses and results. Conclusions drawn from
                                                                   CRM dimensions. The differences in their CRM
the analyses, the associated marketing implications of
                                                                   dimensions lead them to compete in different market
CRM for freight forwarders, and possible directions for
                                                                   segments, in which their resources are best deployed to
future research are outlined in the final section.
                                                                   satisfy the needs of specific customer groups.
2. Customer Relationship Management (CRM)                               Hart et al. (2004) found that significant differences
                                                                   emerge among suppliers (software vendors) regarding
      A growing body of academic and practitioner
                                                                   the effect of experience on using different methods to
literature has highlighted the differences in definitions
                                                                   evaluate CRM initiatives. The differences in CRM
and approaches to CRM. According to Payne and Frow
                                                                   activities include evaluate through response to direct
(2004), CRM refers to the implementation of a specific
                                                                   campaign, evaluate through customer surveys, and
technology solution project, an integrated series of
                                                                   evaluate through focus groups. Payne and Frow (2004)
customer-oriented technology, and a holistic strategic
                                                                   also indicated the importance of developing market
approach to managing customer relationships to create
                                                                   structure to identify the differences in products or
shareholder value. CRM can be defined as a term for
                                                                   services flow from the producer to the final customer.
methodologies,      technologies,    and     e-commerce
                                                                   However, to the best of our knowledge, previous
capabilities used by companies to manage customer
                                                                   research has failed to explore and categorize firms’
relationships (Stone and Woodcock 2001), and the
                                                                   CRM behavior or activities within a specific industry.
management approach that involves identifying,
attracting, developing and maintaining successful                       This research is one of the first devoted to
customer relationships over time in order to increase              evaluating CRM activities from a freight forwarder’s
retention of profitable customers (Bradshaw and Brash              perspective. The above discussion leads us to postulate
2001; Massey et al. 2001).                                         that there are different groups of freight forwarders in


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Proceedings of the 13th Asia Pacific Management Conference, Melbourne, Australia, 2007, 1096-1105

terms of CRM dimensions. From the CRM, the                         questionnaire survey. As seen in Figure 1, the research
enhancement of customer relationships can be                       steps included the questionnaire design and various
considered as a potential source of competitive                    methods of analysis, described below.
advantage. It should enable freight forwarders to                        The selection of CRM attributes by reviewing the
differentiate themselves on the basis of their ability to          literature on marketing research, followed by the design
offer a wide variety of CRM dimensions. Freight                    of the questionnaire, personal interviews with 11 freight
forwarders with a better CRM should be in a better                 forwarder practitioners, and a content validity test. The
position to satisfy the needs of customers through                 questionnaire design followed the stages outlined by
various customer services, and therefore achieve better            Churchill (1991). The content validity of the
service performance. Accordingly, it is reasonable to              questionnaire in this study was tested through a
postulate that firm performance is different among these           literature review and interviews with practitioners; in
groups.                                                            other words, questionnaire questions were based on
                                                                   previous studies (Hayes et al. 1998; Glendon and
3. Research Methodology                                            Litherland 2001; Mearns et al. 2003) and judged as
                                                                   relevant by 11 freight forwarder executives. Interviews
3.1 Sample                                                         with practitioners resulted in minor modifications to the
                                                                   wording and examples provided in some measurement
      This research is based on freight forwarders in the
                                                                   items, which were finally accepted as possessing
Taiwanese market. A questionnaire survey was sent to
                                                                   content validity. For each item, respondents were asked
696 freight forwarding companies in March 2005. The
                                                                   to indicate the extent to which they agreed that the item
initial mailing elicited 83 usable responses. A follow up
                                                                   described its prospective content domain. A five-point
mailing was sent two weeks after the initial mailing,
                                                                   rating scale was used for each item (1 = strongly
which generated an additional 61 usable responses. A
                                                                   disagree, 2 = disagree, 3 = neither agree nor disagree, 4
total of 144 usable questionnaires were collected,
                                                                   = agree, 5 = strongly agree).
representing 20% of the target sample. The possibility
of non-response bias was checked by comparing early                      A one-way ANOVA was also used to identify
and late respondents’ responses for all of the constructs          whether perceived performance differences existed
using ANOVA. No significant differences were found                 between the groups based on performance variables,
(Armstrong and Overton 1977). Thus, it was concluded               such as profit rate, revenues, market share, and growth
there is no evidence of non-response bias.                         rate. All analyses were carried out using the SPSS 12.0
                                                                   for Windows (2003) package and the analysis results
     The results indicate that more than 76% of
                                                                   are presented in the next section.
respondents were vice president or above or
manager/assistant      manager.       Relatively    few
                                                                   4. Results of Empirical Analyses
respondents were director, general employee, and
others (4.4%, 14.9%, and 6.0%, respectively). Just over
                                                                   4.1 Perceptions of CRM
a quarter (30.5%) had been in operation for more than
20 years, while 29.9% had been operating between 11                     According to their aggregated scores for
and 20 years. Nearly 20% of respondents had been                   agreement with the 30 CRM attributes, respondents’
operating between 6 and 10 years, while 18.1% had                  perceptions ranged from neutral to strongly agree (their
been operating for less than 5 years. Over half (78.5%)            mean scores were all over 3.0). As can be seen in Table
of freight forwarder respondents were local companies,             1, the eight attributes eliciting most agreement from
while 11.1% and 10.4% were foreign companies, and                  respondents (those with a mean score of 4.0 or more)
joint venture with local and foreign companies,                    included four customer response variables (our
respectively. Results also indicated that the majority,            company uses phone calls, e-mails, and personnel visits
more than half (53%), had less than 50 employees,                  to communicate with customers; our company rapidly
12.7% had more than 500, and 33.4% had between 50                  responds to customers’ problems, suggestions, and
and 500.                                                           complaints; our company initiatively provides
                                                                   transportation-related information to shippers; and our
     Over half the respondents (58.5%) reported annual
                                                                   company has a good reputation, therefore shippers
revenue of under NT $100 million, 8.5% revealed
                                                                   would initiatively enquiry our services); two customer
annual revenue of NT $1,000 million or more, and
                                                                   knowledge variables (our company is knowledgeable
33.0% had annual revenue between NT $100 million
                                                                   about how to obtain main customers, and our company
and NT $1,000 million.
                                                                   understands main customers’ service requirements); one
                                                                   customer needs variable (our company would
3.2 Research Methods
                                                                   accompany customers’ special needs); and one location
   The research was accomplished by conducting a                   variable (our company has location advantages).


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     In contrast, respondents showed lowest agreement                are shown in Table 3. The reliability value of each
with the following: our company would send gifts to                  factor was well above 0.79, indicating adequate internal
customers periodically; our company provides sales                   consistency (Nunnally 1978; Sekaran 1992; Churchill
rebates for customers; the company is capable of using               1991).
a computer system to categorize targeted markets; the                    These six CRM dimensions (factors) were labeled
company’s computer system is capable of organizing                   and are described below:
and classifying interaction between sale representatives                   Factor 1, a customer acquisition dimension,
and customers; and the company has a computer system                 consisted of seven items: our company has flexible
sufficient to handle customer information (their mean                measures for customers’ urgent requirements; our
scores were below 3.31).                                             company has a different marketing mix for target
                                                                     customers; our company would use customer
4.2 Factor Analysis                                                  information to develop a new market; our company
                                                                     would use customer information to apply marketing
      Factor analysis was used to reduce the 30 CRM
                                                                     planning; our company provides a variety of service
attributes in freight forwarder services to smaller sets of
                                                                     items and information; our company provides sales
underlying factors (dimensions). This helped to detect
                                                                     rebates for customers; and our company provides
the presence of meaningful patterns among the original
                                                                     solitary services to meet customers’ requirements. Most
variables and to extract the main service factors.
                                                                     of these items are related to customer acquisition
Principal components analysis with varimax rotation
                                                                     activities. This factor accounted for 41.66% of the total
was employed to identify key CRM dimensions, as
                                                                     variance. Our company provides solitary services to
shown in Table 2. The data were deemed appropriate
                                                                     meet customers’ requirements had the highest factor
for analysis, according to the Kaiser-Meyer-Olkin
                                                                     loading for this dimension.
measure of sampling adequacy value of 0.905 (Hair et
al. 1995). The Bartlett Test of Sphericity was                             Factor 2, a customer response dimension,
significant [χ2 = 2757.6, P < 0.01], indicating that                 comprised five items: our company uses phone calls,
correlations existed among some of the response                      e-mails, and personnel visits to communicate with
categories. Scree plots and eigenvalues greater than one             customers; our company rapidly responds to customers’
were used to determine the number of factors in each                 problems, suggestions, and complaints; our company
data set (Churchill 1991).                                           initiatively provides transportation-related information
                                                                     to shippers; our company would initiatively understand
     A plot of the size of eigenvalues against the
                                                                     customers’ service requirements and expectations; and
number of factors in their order of extraction is
                                                                     our company has a good reputation, therefore shippers
conducted. The last real factor is considered to be that
                                                                     would initiatively enquire about our services. These
point before which the first scree begins (Hair et al.
                                                                     items are customer response-related activities in freight
1995). Factors with eigenvalues lower than one were
                                                                     forwarder services. Our company rapidly responds to
not significantly indicated in the first scree plot.
                                                                     customers’ problems, suggestions, and complaints had
The seven key CRM dimensions identified accounted
                                                                     the highest factor loading for this dimension. Factor 2
for approximately 69% of the total variance. However,
                                                                     accounted for 6.58% of the total variance.
the interpretability of this solution was rendered
problematic because one complex item (A16) loaded on                      Factor 3, a customer knowledge dimension,
two factors. Thus, this item was removed from further                consisted of four items: our company is knowledgeable
analysis.                                                            about how to obtain main customers; our company
                                                                     understands main customers’ service requirements; our
      To aid interpretation, only variables with a factor
                                                                     company has fruitful capabilities to obtain new
loading greater than 0.50 were extracted, a conservative
                                                                     customers; and our customers often insist of using our
criterion based on Kim and Muller (1978) and Hair et al.
                                                                     company’s       services.    These     are     customer
(1995). The scores on each of the seven CRM
                                                                     knowledge-related activities. Our company is
dimensions (factors) were calculated for each
                                                                     knowledgeable about how to obtain main customers had
respondent and submitted to subsequent cluster analysis.
                                                                     the highest factor loading for this dimension, followed
Seven CRM dimensions (factors) were found to
                                                                     by our company understands main customers’ service
underlie the various sets of CRM attributes in freight
                                                                     requirements, our company has fruitful capabilities to
forwarder services.
                                                                     obtain new customers, and our customers often insist on
                                                                     using our company’s services. Factor 3 accounted for
4.3 Reliability Test
                                                                     5.59% of the total variance.
   A reliability test based on Cronbach’s Alpha was                      Factor 4, a customer information system
used to test whether these dimensions were consistent                dimension, comprised four items: the company is
and reliable. Cronbach Alpha values for each dimension               capable of using their computer system to categorize

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targeted markets; the company’s computer system is                     In addition to identifying whether perceived
capable of organizing and classifying interaction                 differences existed among groups based on
between sales representatives and customers; the                  respondents’ characteristics, the 144 respondents were
company has a computer system sufficient to handle                categorized into four groups on the basis of their factor
customers’ information; and our company has a                     scores in CRM dimensions. Fifty-three were assigned to
management system to check transactions and customer              Group 1, 32 to Group 2, 37 to Group 3, and 22 to
relationships. These are related to customer information          Group 4. Canonical discriminant functions (Klecka
system equipment. The company’s computer system is                1980) demonstrated the nature of group differences, and
capable of organizing and classifying interaction                 explained 100% of the variance.
between sales representatives and customers had the
highest factor loading for this dimension, followed by            4.5 Interpretation of Clusters
the company is capable of using their computer system
to categorize targeted markets, the company has a                     A one-way analysis of variance (ANOVA) was
computer system sufficient to handle customers’                   used to examine whether the CRM dimensions differed
information, and our company has a management                     among the four groups. Table 4 shows ANOVA test
system to check transactions and customer relationships.          results in terms of factor score coefficients. The results
Factor 4 accounted for 5.10% of the total variance.               indicate that these six CRM dimensions were found to
                                                                  significantly differ among the four groups at the p <
     Factor 5, a customer value evaluation dimension,             0.05 significance level.
consisted of two items: our company would analyze                      Table 4 also presents the differences in CRM
individual customers’ profit contribution, and our                dimensions between the four segments based on a
company would analyze customer types and behaviors                Scheffe test. The results show that these six CRM
to identify customer value. These two items are                   dimensions were found to significantly differ between
customer value evaluation-related items, therefore the            Groups 1 and 3. The customer knowledge and customer
factor was identified as a customer value evaluation              information process dimensions were found to be
dimension. Our company would analyze customer types               significantly different between Groups 1 and 2, whereas
and behaviors to identify customer value had the                  the customer response and customer information system
highest factor loading for this dimension. Factor 5               dimensions were found to be significantly different
accounted for 3.58% of the total variance.                        between Groups 1 and 4. With the exception of
                                                                  customer knowledge and customer information system
     Factor 6, a customer information process
                                                                  dimensions, significant differences between the CRM
dimension, comprised three items: the company’s
                                                                  dimensions in Groups 2 and 3 were found in this
computer system is capable of storing, searching, and
                                                                  research. In addition, the customer acquisition
analyzing customers’ data; the company’s computer
                                                                  dimension and customer information system dimension
system is capable of recording customers’ purchases
                                                                  were found to be significantly different between Groups
and services; and our company has location advantages.
                                                                  2 and 4, while the customer acquisition, customer
The company’s computer system is capable of storing,
                                                                  information system, customer value evaluation, and
searching, and analyzing customers’ data and the
                                                                  customer information process dimensions were found to
company’s computer system is capable of recording
                                                                  significantly differ between Groups 3 and 4.
customers’ purchases and services both had a similarly
high factor loading for this dimension, therefore this                  A comparison of the mean score for each CRM
factor was identified as a customer information process           dimension shows that Group 1 had its highest mean
dimension. Factor 6 accounted for 3.28% of the total              score in the customer response dimension. Group 2 had
variance. Factor 6 accounted for 3.34% of the total               its highest score in the customer knowledge dimension,
variance, slightly less than factor 5.                            followed by customer information process, customer
                                                                  response, customer value evaluation, and customer
     Table 3 also shows respondent freight forwarders’
                                                                  information systems dimensions. However, it had a
agreement level as to the importance of each CRM
                                                                  lower score in the customer acquisition dimension.
dimension in the current situation. The results indicate
                                                                  Group 3 had its highest mean score in the customer
that they considered the customer response dimension
                                                                  information process dimension, followed by customer
to be the most important (factor 2), followed by the
                                                                  response, customer acquisition, customer knowledge,
customer knowledge dimension (factor 3), the customer
                                                                  customer value evaluation, and customer information
information process dimension (factor 6), the customer
                                                                  system dimensions. Group 4 focused particularly on the
acquisition dimension (factor 1), the customer value
                                                                  customer response and customer knowledge dimensions,
evaluation dimension (factor 5), and the customer
                                                                  but had lower scores in the customer information
information system dimension (factor 4).
                                                                  system and customer value evaluation dimensions. In
                                                                  general, Group 4 had its higher mean scores for each
4.4 Cluster Analysis Results

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CRM dimension than other groups.                                  aspects of firms’ service attributes. A carrier’s
                                                                  competition will vary from market to market. The use
     In summary, from the results of the Scheffe tests
                                                                  of this framework can assist managers’ evaluation of
and the comparison results of the dimensions’ mean
                                                                  their competitive strategies and long-term opportunities
scores, four groups of freight forwarder services
                                                                  for profitability within the industry. This means that
emerged based on the six CRM service dimensions:
                                                                  freight forwarding companies should think of
customer response oriented firms, customer knowledge
                                                                  competition in terms of their markets. Marketing
and information process oriented firms, customer
                                                                  activities for each market segment should emphasize
information process and response oriented firms, and
                                                                  the forwarder’s advantages relative to the strengths and
customer response and knowledge oriented firms.
                                                                  weaknesses of likely competitors in each market.
     One-way ANOVA analysis was used to test the                  Freight forwarding companies should not neglect the
differences in perceived financial performance among              usefulness of service differentiation in competition. The
the four groups based on Scheffe tests. Respondents               ability of a forwarder to detect subtle differences
were also asked to provide information relating to their          between customers and tailor marketing efforts and
perceived financial performance in terms of profit rate,          services to the needs of each customer should improve
revenues, market share, and growth rate (see Table 5).            its ability to gain competitive advantage in a
Since the statistically significant level was less than           competitive environment.
0.05, it was concluded that financial performance
                                                                       Second, this study found that customer response is
significantly differed among the four groups. Best
                                                                  perceived as the most important dimension. This
financial performance in terms of profit rate and
                                                                  suggests that freight forwarding companies should
revenues was found in customer information process
                                                                  particularly emphasize CRM attributes such as
and response oriented firms, followed by customer
                                                                  communication with customers, response to customers’
response and knowledge oriented firms, customer
                                                                  problems and complaints, understanding customers’
knowledge and information process oriented firms, and
                                                                  service requirements, and increasing good service
customer response oriented firms.
                                                                  reputation in order to increase their competitive edge.
5. Discussion and Conclusions
                                                                       Finally, these research results provide insights for
      Customer relationship management has rapidly                managers into the characteristics of freight forwarding
become one of the leading competitive business                    company types, which are useful for formulating plans
strategies (Kim et al. 2003). While there have been               to benchmark and set targets for CRM dimensions and
several empirical research studies of CRM in specific             performance improvement in the different market
industries or services, research on freight forwarder             segments in which they are serving or intend to
services has been minimal. This study has therefore               compete.
sought to examine the importance of identifying CRM
dimensions in the context of freight forwarder services.          References
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                                       Table 1. Respondents’ Agreement with CRM Attributes

     CRM attributes                                                                                                            Mean          S.D.
     Our company uses phone calls, e-mails, and personnel visits to communicate with
                                                                                                                                4.49         0.81
     customers.
     Our company rapidly responds to customers’ problems, suggestions, and complaints.                                          4.37         0.88


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    Our company understands main customers’ service requirements.                                                           4.16       0.90
    Our company is knowledgeable about how to obtain main customers.                                                        4.16       0.83
    Our company has a good reputation, therefore shippers would initiatively enquiry our
                                                                                                                            4.06       0.94
    services
    Our company initiatively provides transportation related information to shippers.                                       4.04       0.97
    Our company would accommodate customers’ special needs.                                                                 4.01       0.88
    Our company has location advantages.                                                                                    4.00       0.87
    The company’s computer system is capable of recording customers’ purchases and services.                                3.96       1.06
    Our company would initiatively understand customers’ service requirements and
                                                                                                                            3.91       1.08
    expectations.
    Our company provides a variety of service items and information.                                                        3.90       0.98
    Our company provides solitary services to meet customers’ requirements.                                                 3.88       0.93
    The company’s computer system is capable of storing, searching, and analyzing customers’
                                                                                                                            3.85       1.01
    data.
    Our company has flexible measures for customers’ urgent requirements.                                                   3.81       0.93
    Our customers often insist on using our company’s services.                                                             3.76       0.89
    Our company has fruitful capabilities to obtain new customers.                                                          3.69       0.92
    Our company has a different marketing mix for target customers.                                                         3.68       0.99
    Our company would use customer information to develop a new market.                                                     3.67       0.90
    Our customers often introduce other customers to purchase our company’s services.                                       3.62       0.96
    Customers can easily seek out our company’s related information.                                                        3.61       0.97
    Our company would analyze individual customers’ profit contribution.                                                    3.57       1.03
    Our company would analyze customer types and behaviors to identify customer value.                                      3.49       0.96
    Our company would apply customer information to marketing planning.                                                     3.42       0.94
    Our company has a management system to check transaction and customer relationships.                                    3.39       1.12
    Our customers would provide market-related information to our company.                                                  3.37       0.97
    The company has a computer system sufficient to handle customers’ information.                                          3.30       1.18
    The company’s computer system is capable of organizing and classifying interaction
                                                                                                                            3.28       1.16
    between sale representatives and customers.
    The company is capable of using their computer system to categorize targeted markets.                                   3.27       1.15
    Our company provides sales rebate for customers.                                                                        3.21       1.17
    Our company would send gifts to customers periodically.                                                                 3.13       1.25
   Note: The mean scores are based on a five-point Likert scale (1 = strongly disagree to 5 = strongly agree); S.D. = standard deviation.


                                            Table 2. Factor Analysis for CRM Attributes

                                                                             1         2        3      Factor 4      5         6        7
Our company has flexible measures for customers’ urgent
requirements.                                                                0.62      0.24     0.32       0.11      0.27     0.23      0.07
Our company has a different marketing mix for target
customers.                                                                   0.73      0.11     0.26       0.04      0.19     0.00      0.04
Our company would use customer information to develop
a new market.                                                                0.63      0.19     0.41       0.30      0.15     0.02      0.01
Our company would apply customer information to
marketing planning.                                                          0.63      0.01     0.16       0.26      0.30     0.00      0.19
Our company provides a variety of service items and
information.                                                                 0.57      0.41     0.13       0.28      0.21 0.14          0.06
Our company provides sales rebates for customers.                            0.54      0.13     0.03       0.45      0.04 -0.00         0.27
Our company provides solitary services to meet
customers’ requirements.                                                     0.74      0.27 -0.01         -0.02      0.01     0.26      0.17
Our company uses phone calls, e-mails, and personnel
visits to communicate with customers.                                        0.11      0.65     0.36       0.01      0.24     0.26      0.01
Our company rapidly responds to customers’ problems,
suggestions, and complaints.                                                 0.14      0.71     0.29       0.19      0.11     0.32      0.01
Our company initiatively provides transportation related                     0.24      0.60     0.23       0.28      0.25     0.10      0.21

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Proceedings of the 13th Asia Pacific Management Conference, Melbourne, Australia, 2007, 1096-1105

information to shippers.
Our company would initiatively understand customers’
service requirements and expectations.                            0.40     0.64      0.11      0.25   0.04    0.02   0.04
Our company has a good reputation, therefore, shippers
would initiatively enquire about our services.                    0.18     0.65      0.20      0.08   0.13 -0.02     0.42
Our company is knowledgeable about how to obtain main
customers.                                                        0.28     0.24      0.76      0.11   0.13    0.23   0.07
Our company understands main customers’ service
requirements.                                                     0.20     0.42      0.65      0.09   0.02    0.27   0.11
Our company has fruitful capabilities to obtain new
customers.                                                        0.42     0.22      0.53      0.30 -0.00 -0.10      0.18
Our customers often introduce other customers to
purchase our company’s services.                                  0.03     0.23      0.50      0.01   0.18 -0.04     0.50
Our customers often insist on using our company’s
services.                                                         0.18     0.16      0.55     -0.01   0.46    0.11   0.21
The company is capable of using their computer system to
categorize targeted markets.                                      0.14 -0.00         0.22      0.73   0.08    0.36   0.08


                                Table 3. Factor Analysis for CRM Attributes (continue)
The company’s computer system is capable of organizing
and classifying interactions between sale representatives
and customers.                                                     0.25     0.22 -0.07         0.74   0.09    0.09   0.00
The company has a computer system sufficient to handle
customers’ information.                                           -0.03     0.22     0.05      0.67   0.15    0.22   0.18
Our company has a management system to check
transactions and customer relationships.                           0.37     0.07     0.36      0.60   0.33 -0.09     0.11
Our company would analyze individual customer’s profit
contribution.                                                      0.24     0.19     0.11     0.26    0.75    0.15   0.05
Our company would analyze customer types and
behaviors to identify customer value.                              0.20     0.14     0.11      0.15   0.79    0.17   0.18
The company’s computer system is capable of storing,
searching, and analyzing customers’ data.                          0.16     0.16     0.09      0.41   0.24    0.69   0.54
The company’s computer system is capable of recording
customers’ purchases and services.                                 0.16     0.28     0.12 0.31 0.17           0.69 -0.02
Our company has location advantages.                               0.49     0.14     0.23 -0.04 -0.00         0.55 0.24
Our customers would provide market-related information
to our company.                                                    0.17 0.31         0.16     0.06 0.34 -0.05        0.64
Our company would send gifts to customers periodically.            0.24 -0.03        0.09     0.23 -0.00 0.25        0.71
Customers can easily seek out our company’s related
information.                                                       0.16     0.24     0.36     0.29    0.33 -0.01     0.38
Our company would accompany customers’ special needs.              0.29     0.34     0.40     0.04    0.04 0.25      0.16
Eigenvalues                                                       12.91     2.04     1.73     1.58     1.1 1.03      1.00
Percentage variance                                               41.66     6.58     5.59     5.10    3.58 3.34      3.32


                              Table 4. Cronbach Alpha Values for Each CRM Dimension
                  CRM dimension                        Number of          Cronbach          Mean1     S.D.2
                                                         items             Alpha
1.   Customer acquisition                                   7              0.884            3.724     0.736
2.   Customer response                                      5              0.861            4.172     0.754
3.   Customer knowledge                                     4              0.834            4.002     0.755


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4.    Customer information system                                        4              0.806             3.282   0.957
5.    Customer value evaluation                                          2              0.811             3.531   0.912
6.    Customer information process                                       2              0.792             3.906   0.944
Note: 1. Represent mean scores based on a five-point scale (1= strongly disagree, 5 = strongly agree).
      2. Standard deviation.


                      Table 5. One-way ANOVA Analysis of CRM Differences Among the Four Groups
                                                                             Group
CRM dimensions                                        1          2             3            4             F Scheffe test.
                                                    (53)        (32)          (37)         (22)       Value
Customer acquisition                                3.401       3.30          4.50         3.77     **36.26 (1,3), (2,3),
                                                   (0.50)2     (0.67)        (0.43)       (0.66)            (2,4), (3,4)
Customer response                                   3.86        3.99          4.64         4.42     **11.17 (1,3), (1,4)
                                                   (0.88)      (0.69)        (0.41)       (0.48)                (2,3),
Customer knowledge                                  3.47        4.19          4.46         4.26     **21.24 (1,2), (1,3)
                                                   (0.75)      (0.60)        (0.47)       (0.61)                (1,4)
Information system                                  3.09        3.43          3.92         2.47     **15.18 (1,3), (1,4)
                                                   (0.75)      (1.07)        (0.83)       (0.68)             (2,4), (3,4)
Customer value evaluation                           3.19        3.52          4.43         2.86     **29.45 (1,3), (2,3)
                                                   (0.76)      (0.71)        (0.54)       (0.89)                (3,4)
Customer information process                        3.33        4.08          4.72         3.68     **24.52 (1,2), (1,3)
                                                   (0.80)      (0.97)        (0.45)       (0.81)             (2,3), (3,4)
Note: 1. Represent mean scores based on a five-point scale (1 = strongly disagree, 5 = strongly agree).
      2. Represent standard deviation; * Significance level p < 0.05; ** Significance level p < 0.01.

                           Table 6. One-way ANOVA Analysis of Perceived Performance Differences
                                                among the Four Groups

                                               Groups
     Performance           1            2           3             4          F Ratio               Scheffe
                                                                                                     Test
 Profit rate             3.06          3.34        3.95         3.50
                                                                             **10.78            (1,3), (2,3)
                                       (0.75      (0.74)       (0.91)
                       (0.61)      )
 Revenues                3.25       3.34           3.78         3.36           *2.77
                                   (0.97)         (0.95)       (0.90)
                       (0.77)
 Market share            2.96       3.09           3.76         2.73           **8.79
                                                                                                (1,3),(2,3),
                                   (1.00)         (0.93)       (0.94)
                       (0.66)                                                                   (3,4)
 Growth rate             3.10       3.13           4.00         3.45           **9.09
                                                                                                (1,3), (2,3)
                                   (1.04)         (0.85)       (0.86)
                       (0.76)
Note: * Significance level p < 0.05; ** Significance level p < 0.01.




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