Submitted ToMr. V M Mathur

Submitted By:Ankit Mahajan (201018)Arushi Agarwal (201024)Dhruv Agarwal (201035)Dhruv Gupta (201037)Gaurav Arora (201040)Hari Kishan Y (201045)

FORE School of Management

Table of Contents

Toyota...................................................................................................................3

Success behind Toyotas #1 Status.........................................................................4

What is CRM?........................................................................................................5

Components of CRM.............................................................................................8

What is Lean CRM?...............................................................................................9

Why Lean CRM?..................................................................................................10

Toyota - before and after Lean CRM...................................................................10

Salesforce.com:...................................................................................................13

Force.com Platform and the AppExchange.........................................................14

Cloud platform for Toyota CRM..........................................................................15

Framework for the Solution................................................................................20

Implementation details.......................................................................................22

References:.........................................................................................................24

Biliography:.........................................................................................................25

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About Toyota

Toyota Motor Corporation, commonly known simply as Toyota and abbreviated as TMC, is a multinational automaker headquartered in Toyota City, Aichi, Japan. In 2010, Toyota Motor Corporation employed 317,734 people worldwide, and was the world's largest automobile manufacturer by production.

With a deft combination of marketing, public relations, and lobbying, Toyota has done a remarkable job over the past 20 years of selling itself as an American company though it has it roots in Japan.

The worldwide ranking of automakers is compiled once per year by the International Organization of Motor Vehicle Manufacturers OICA. In 2010, the Toyota Motor Corporation ranked first on the list with 8.6 million units produced globally.

Toyota's customer relationship efforts have focused on emphasizing the positive experiences of ownership and vehicle quality. The ownership experience has been targeted in slogans such as "You asked for it! You got it!" (1975–1979), "Oh, what a feeling!" (1979 – September 1985, in the US), "Who could ask for anything more" (September 1985–1989), "I love what you do for me, Toyota!" (1989–1997), "Everyday" (1997–2001)", "Get the feeling!" (2001–2004), and "Moving Forward" (2004–present).

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Success behind Toyotas #1 Status

One can hardly pick up a business newspaper today without reading of the demise of the big Detroit automakers at the hands of Toyota. But what exactly is behind this success?

A large part of the answer is Toyota's obsession with its customers. Toyota's internal sales and marketing bible, The Toyota Way in Sales and Marketing, makes it patently clear to all staff that totally satisfied customers is the source of its success. Everything Toyota does is done with this in mind.

But in what may be surprising to those who believe a manufacturing strategy doesn't work in a customer-centric environment, is that a good measure of Toyota's success is a strategy that manages to straddle both manufacturing and non-manufacturing environments. It's one called Lean CRM, which was developed by Toyota in Europe, in response to the growing volume of customer information collected at the many touch-points during the customer lifecycle. It allows Toyota to sense changes in individual customers' behavior and to respond in a way that increases customer satisfaction. It has enabled Toyota to sell significantly more vehicles, with a shorter trade cycle and higher repurchase rate, at significantly lower costs.

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What is CRM?

CRM stands for Customer Relationship Management. It is a process or methodology used to learn more about customers' needs and behaviors in order to develop stronger relationships with them. There are many technological components to CRM, but thinking about CRM Software in primarily technological terms is a mistake. The more useful way to think about CRM is as a process that will help bring together lots of pieces of information about customers, sales, marketing effectiveness, responsiveness and market trends.

CRM helps businesses use technology and human resources to gain insight into the behavior of customers and the value of those customers.

On an organizational perspective CRM (customer relationship management) is an information industry term for methodologies, software, and usually Internet capabilities that help an enterprise manage customer relationships in an organized way. For example, an enterprise might build a database about its customers that described relationships in sufficient detail so that management, salespeople, people providing service, and perhaps the customer directly could access information, match customer needs with product plans and offerings, remind customers of service requirements, know what other products a customer had purchased, and so forth.

The figure below shows the importance of CRM by annual expenditure on CRM applications by companies and worldwide.

(From the July 01, 2011 Issue of Direct Marketing News , Source: Gartner “CRM Market Trends and Dynamics”, Feb 2011)

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Advantages of CRM

A CRM system may be chosen because it is thought to provide the following advantages

Quality and efficiency Decrease in overall costs Decision support Enterprise agility Customer Attention

CRM focuses on the relationship

Toyota uses three steps to build customer relationships:

determine mutually satisfying goals between Toyota and customers establish and maintain customer rapport produce positive feelings in the company and the customers

CRM conditions

Toyota as a company and the customers both have sets of conditions to consider when building the relationship, such as wants and needs of both parties-

Toyota needs to make a profit to survive and grow Customers buying automobiles want good service, a quality product and an acceptable price

How CRM impacts Toyota

CRM has a major impact on Toyota as an automobile manufacturer through:

Shifting the focus from product(here automobiles) to customer Streamlining the offer to what the customer requires, not what Toyota can make Highlighting competencies required for an effective CRM process

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Toyotas viewpoint

The old viewpoint in automobile industry was: 'Here's what we can make - who wants to buy our product?'The new viewpoint recognized by Toyota is:

'What exactly do our customers want and need?' and 'What do we need to do to be able to produce and deliver it to our customers?'

This is a significant change of paradigm and a quantum leap in terms of how Toyota looks at their business activity.

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Components of CRM

Although researchers have developed different detentions for CRM, these definitions are closely related.There is a general acceptance among researchers of the categorization of CRM components. CRM consists of three major components: Technology, people, business culture and relationship, and ProcessThe contribution to each component varies according to the level of CRM implementation.

TechnologyTechnology refers to computing capabilities that allow a company to collect, organize, save, and use data about its customer. Technology is the enabler for CRM systems to achieve their objectives of collecting, classifying, and saving valuable data on customers. Integration technology allows organizations to develop better relationship with customers by providing a wider view of the customer behavior. Thus, organizations are required to integrate IT to improve the capabilities of understanding customer behavior, develop predictive models, build effective communications with customers and respond to those customers with real time and accurate information. For an organization to integrate IT, concepts such as data warehouse, software customization, process automation, help desk and call centers, and internet influence should be addressed.

PeopleEmploys and customers are a key factor for successful CRM projects. CRM is built around customers to manage beneficial relationships through acquiring information on different aspects of customers. The main objective of CRM is to translate the customer information into customized products and services that meet the changing needs of customers in order to gain their loyalty. Nevertheless, a full commitment of the organization's staff and management is essential for an effective CRM implementation to best serve customers and satisfy their needs.

Business processCRM is a business strategy that has its philosophical basis in relationship marketing. CRM success requires a change of business processes towards customer – centric approach. As such, all business processes that involve both direct and indirect interaction with customers should be analyzed and assessed. Although CRM has an organization-wide impact, process that has direct interaction with customers should be dealt with as a priority when integrating and automating business processes. According to the main business processes that should be addressed in CRM implementation are: marketing, sales, and services.

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What is Lean CRM?

Lean CRM was developed by Toyota in Europe, in response to the growing volume of customer at the many touch points during the customer lifecycle. It allows Toyota to sense changes in individual customers’ behavior and to respond in w way to increase customer satisfaction.

Simply put, it contains the functions that help develop a response to the growing volume of customer information collected at the many touch-points during the customer lifecycle. It allows organizations to sense changes in individual customers’ behavior and to respond in a way that increases customer retention.

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Why Lean CRM?

Lean CRM as the name suggests provides a lean ‘efficient’ approach and embodies best practice solutions which are scalable, repeatable and offers customers a proven business model with rapid delivery and return on investment.

Looking at the past five years, things have changed quite a lot, and most of it, no matter how daunting it may have seemed at the time, was pretty painless in retrospect . The first thing to note is that although the term CRM took a dive during 2002/03 with many alternative terms invented, the concept continues to grow in importance. In the not too distant future a company’s CRM assets will be part of its market valuation. So learning how to grow those assets is imperative. Yet studies show that 60-70 per cent of companies are still struggling to achieve benefits. So this report states how Toyota jumped over hurdles and successfully implemented Lean CRM.

Toyota - before and after Lean CRM

In 2003, Toyota carried out an audit of customer management in its European markets. It identified a number of key customer management processes that, if improved, would contribute significantly to its bottom line. But rather than start an inside-out re-engineering project immediately, company management decided to canvas Toyota dealers in the affected markets to see what they thought. After all, they are the ones who have daily contact with drivers. They are Toyota’s internal customers. To anyone who has worked in the automotive industry, canvassing dealers for their thoughts is practically unheard of.

Dealers were a little suspicious at the start, but 20 pilot dealers were persuaded to work closely with Toyota in an advisory board. Many discussions, visits and workshops were held to identify ways to radically improve the processes. They identified a whole host of things dealers were already doing to improve the processes that Toyota management had no idea about. These ideas were to form the foundation of the whole Lean CRM program.

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Most large companies have many different departments that deal with customers. The division into marketing, sales and service is typical. Toyota had the three, plus a number of others. All would have to be involved in the Lean CRM program if it was to be a success. The program sponsors from marketing set out the problem, its origins, the chosen solution and how it would be implemented on a single sheet of A3 paper. The Lean CRM A3 was then discussed with each of the affected departments through a process Toyota calls “Nemawashi.” Nemawashi is part of the fabled “Toyota Way.” Through this process, a problem or opportunity is explained in detail, with each party committing to support the program in the form of a binding signature on the A3. One by one, each of the departments signed up to the Lean CRM A3 and agreed to loosely coordinate their own customer management activities with the program.

Big bang implementations of CRM don’t work. There are too many variables that just can’t be controlled. Toyota decided to go for a step-by-step approach that would still shoot for the big Lean CRM prize but one shot at a time. A series of back-to-back pilot projects were developed in close collaboration with the pilot dealers. The first pilot involved extracting whatever data was available from source systems in Toyota and the pilot dealers, loading it into an analytical data mart and analyzing the data to see what could be done with it. Once the step had been piloted and proven, it was industrialized for general use by the program. Each subsequent step, thus, built upon the infrastructure, experience and knowledge developed in the previous steps. This iterative approach allowed the program use what had already been developed to create value immediately through eliminating costly waste on the one hand and expeditionary marketing campaigns that create revenue on the other. It also allowed the programme to alter its direction when a piece of technology ran significantly over budget and was cancelled.

As the Lean CRM program progressed through a number of industrialized steps, other groups were integrated into it. Chief of these was the marketing agency that ran the Toyota Customer Contact Program. Other programs, such as the Toyota Experience Program, were also integrated into it. A part-time CRM coordinator had been recruited from within the business to manage the collaboration required within the program, and with other partners and programs. Toyota management also established a customer management forum alongside the dealer advisory board to provide a framework to manage collaboration on a larger scale, now that the programme was already delivering results. The more successful the program was, the more other departments wanted to piggyback on its success and closely integrate their own customer management activities with the program.

Each time one of the earlier steps in the program was industrialized, it went through a “Kaizen” process. Formal lean tools were applied to identify waste, to remove it at the source and to increase its efficiency and effectiveness. This wasn’t carried out by a special Kaizen team but by the program team members, themselves. As the Lean CRM program proceeded, Kaizen was increasingly applied as a daily activity by all those involved in the program’s activities. The

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Lean CRM program is a success within Toyota. It now manages all of Toyota’s outbound contacts with customers and an increasing number of inbound ones. The efficiency and effectiveness of marketing activities have been greatly increased, with a halving of costs and a doubling of response rates to marketing campaigns.

Dealer contacts with customers are shortly to be brought into the program. And other parts of Toyota are now being integrated into the program at a managed rate. Other Toyota national marketing and sales companies are also interested to see how they can implement it at home.The secret of success was not only the new CRM capabilities introduced through Lean CRM, but also the step-by-step way in which the changes associated with the program were implemented. Just as with individuals in everyday life, corporate change does not have to be painful.

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Salesforce.com:

Salesforce.com is an enterprise cloud computing company headquartered in San Francisco that distributes business software on a subscription basis. Salesforce.com hosts the applications off-site.

It is best known for its Customer Relationship Management (CRM) products and, through acquisition, has expanded into the "social enterprise arena."

One of the world's largest vehicle manufacturers utilizes the Force.com Platform-as-a-Service to deploy fully integrated sales environment in less than three months.

Salesforce.com , the market and technology leader in on-demand business services, announced in late 2007 that Toyota Motor has standardized on salesforce.com's multi-tenant on-demand service and deployed a fully integrated sales environment in less than three months. Toyota Motor can now automate many day-to-day sales processeswhich allow its sales territories to work together more efficiently resulting in a substantial increase in customer responsiveness.

Account managers at Toyota Motor headquarters in Belgium, as well as Toyota National Sales and Marketing companies throughout the world, use the multi-tenant on-demand service to target, acquire and manage day-to-day relationships with multi-national fleet customers. Utilizing the Force.com platform, Toyota Motor customized the system to meet its unique needs enabling the company to automate many day-to-day processes.

One of the main reasons for choosing the on-demand Salesforce application is its ability to integrate with back office systems and external sources of information regarding vehicle data. The Force.com platform offers the flexibility to integrate with any enterprise application or system-offering faster, easier, and more cost effective integration.

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Force.com Platform and the AppExchange 

Force.com reinvents the traditional development, deployment and distribution of any business application with Platform-as-a-Service. Developers, customers and partners can use Force.com to easily create a new generation of on-demand applications and deploy them worldwide as a service. Force.com allows applications to be easily shared, exchanged and installed with a few simple clicks via salesforce.com's AppExchange marketplace, enabling all the innovation that Force.com unleashes to be easily distributed to the entire on-demand community. The AppExchange economy continues to expand, with thousands of customers installing thousands of applications via the AppExchange. Customers of all sizes can quickly and easily extend Salesforce with additional on-demand business applications available on the AppExchange, found at http://www.salesforce.com/appexchange.

With 100,000+ customers, salesforce.com is the enterprise cloud computing company that is

leading the shift to the social enterprise. Social enterprises leverage social, mobile and open

cloud technologies to put customers at the heart of their business. Based on salesforce.com's

real-time, multitenant architecture, the company's platform and application services include:

Salesforce Chatter, a private social network for your business

Salesforce Sales Cloud, for sales force automation and contact management

Salesforce Service Cloud, for customer service and support solutions

Salesforce Radian6, for social media monitoring and engagement

Salesforce Data.com, the most complete source of accurate business data

AppExchange, the leading marketplace for enterprise cloud computing applications

Force.com, for custom application development

Heroku, for building social and mobile apps in Ruby

Database.com, the world’s first enterprise cloud database

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Cloud platform for Toyota CRM

Get a complete view of your customers

With the Force.com cloud platform, you can track any data you want, such as orders, discounts, references, competitors… anything.

Run all your CRM processes

With Force.com, one can run code in the cloud so there are no limitations on CRM logic—and no need for more servers.

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Work smarter—and faster

Your business is made up of hundreds of business processes. Now you can design and automate

any business process or workflow without code.

Achieve 100% user adoption

You can customize the UI for any type of user: a sales manager, marketing executive, customer service agent, or anyone in your business.

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Connect CRM with Web site

Customer data captured on the Web flows right into CRM app.

Access your data: anytime, anywhere

Run CRM apps—including all customizations—on popular mobile devices.

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Applications and services

Applications for accounting, recruiting, and asset management to CRM extensions for email marketing, pricing, and quoting.

See what’s happening in business

Knowing what people are working on, what deals are going to close, and how customers are being served.

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Hands on the right content

Get an integrated content library so reps and agents can easily find the right content, right when they need it. But how can they tell which is the right content? Force.com supports voting and discussions, so everyone can see which content is the most successful.

See only what you need to

Granular security and sharing rules to lets one decide which users see what information, all the way down to the field level.

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Framework for the Solution

This research is proposing a conceptual framework that aims to contribute to implement CRM successfully based on common sense, previous studies, and experience (Payne and Frow, 2005). The framework integrates three major constructs; CRM implementation phases, CRM major components, and CRM success factors. The framework starts by a pre-implementation phase where the organization has to gain the support of top management for implementing CRM before involving in the actual implementation process. Based on gaining sufficient commitment by top management the process could proceed to assessing the readiness of the organization in terms of its human, technological, and organizational (process) capabilities to implement CRM. Therefore, the CRM strategy should be developed, aligned, and communicated to staff. The arrows reflect the flow of the process implementation. Hence, the CRM strategy should be put into action by implementing CRM project focusing on the success factors within each component of CRM. Consequently, implementing each success factors should be measured to ensure successful implementation of CRM project. The final step of the framework focuses on measuring the impact of CRM implementation financially and on marketing performance to ensure realising the objectives of CRM strategy and to assess the effect of other possible external factors. The ascending arrows reflect the process of feedback and learning process of the implementation which is based on measuring implementing CRM success factors and measuring the performance of CRM project after it is fully implemented as a continues process. The organisation could use thel feedback to re-design and re-assess its implementation process. Figure1 shows the proposed conceptual framework.

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Description of diagram showing major subsystem

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Implementation Details

Critical Success Factors for Lean CRM Implementation :

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1. Top management commitmentThis factor focuses on the willingness of the top level management to provide sufficient and necessary recourses needed to the implementation process.

2. CRM strategyThis factor focuses on the clear definition of CRM strategy and its alignment to the organization’s general strategy.

3. Data managementThis factor focuses on acquiring and analyzing the right quantity and quality of information on customers to help to meet customer’s needs.

4. Culture changeThe ability of the organisation to transform into customer-oriented and to consider CRM as an organisation philosophy that is shared organisation-wide.

5. Process change/structure redesignThis factor focuses on developing necessary changes in the organisation’s structure and the related process to fit CRM compatibility including the hierarchy and reporting relations

6. IT systemsThis factor focuses on the availability and management of technological resources including data warehouse management, ERP capabilities, internet facilities, and software selection and configuration.

7. Skilful, Motivated, and trained staffThis factor focuses on the availability of experienced and qualified personnel and the ability of providing training programs.

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8. Customer involvement/consultationThis factor focuses on consultation, interaction, and communication with customer through enhancing interaction between the organisation and the customers.

9. Monitoring, controlling, measuring, and feedbackThis factor focuses on creating and implementing measurements for CRM implementation and CRM impact on the organisation’s performance as well as developing appropriate channels to gain feedback for enhancing the learning process of CRM implementation for required improvements

10. Inter-departmental integrationThis factor focuses on the integration of different departments and areas of the organisation to meet the general objectives of CRM and the main company’s objectives as well as the objectives of these departments.

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References

1. http://www.toyota.com/about/our_values/2. http://www.customerthink.com/article/lean_crm_toyota_strategy_that_works3. http://crm.knowledgehills.com/4. http://www.businessballs.com/crmcustomerrelationshipmanagement.htm5. http://www.businessweek.com/adsections/care/relationship/crm_effective.htm6. http://www.technologyevaluation.com/search/for/case-study-crm-toyota.html7. http://www.toyota.com/about/news/corporate/2011/05/23-1-ToyotaFriend.html8. http://www.helium.com/items/1869467-a-look-at-toyotas-customer-retention-

strategies?page=211. http://www.salesforce.com/in/site-search.jsp?

cx=007946504037312675699%3Aneen5rrs2_a&cof=FORID%3A11%3BNB%3A1&q=toyota&x=0&y=0

12. http://en.wikipedia.org/wiki/Salesforce.com13. http://www.toyota.co.jp/en/environmental_rep/03/kakawari.html14. http://www.sap.com/solutions/business-suite/crm/customers/videos/index.epx15. http://www.toyota-global.com/webservice/tg/dc/en/search?q=crm16. http://www.toyota.com/about/news/corporate/2011/05/23-1-ToyotaFriend.html17. http://www.salesforce.com/company/news-press/press-releases/2007/11/071126-1.jsp18. http://www.salesforce.com/crm/crm_platform/

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Biliography

1. Adrian Payne and Pennie Frow. 2004. “The role of multichannel integration in customer

2. relationship management”. Industrial Marketing Management, 33: 527-538

3. Adrian Payne and Pennie Frow.2005. “A Strategic Framework for Customer Relationship

4. Management”. Journal of Marketing, 69: 167-176

5. Adrian Payne and Pennie Frow. 2006. “Customer Relationship Management: from Strategy to

6. Implementation”. Journal of Marketing Management, 22: 135-168

7. Carl-Erik Wikstrom. 2004. “A Case Study of Emergent and Intentional Organizational Change:

8. Some 9. Implications for Customer Relationship Management Success”. Proceedings of the

37th 10. Hawaii International Conference on System Sciences – 2004 11. Darrel K. Rigby, Frederick F. Reichheld, and Phil Schefter. 2002. “Avoid the Four

Perils of 12. CRM”. Harvard Business Review, February, 2002 13. Ed Peelen, Kees van Montfort, Rob Beltman, and Arnoud Klerkx. 2006. “A Study

into the 14. Foundation of CRM success”. NRG Working Paper no. 06-09

15. Emmanuella Plakoyiannaki, Nikolaos Tzokas, Pavlos Dimitratos and Michael Saren. 2008.

16. “How Critical is Employee Orientation for Customer Relationship Management? Insights from a

17. Case Study”. Journal of Management Studies, 42(2): 268-293

18. Goodhue, D.L., B.H. Wixom, and H.J. Watson. 2002. “Realizing business benefits through

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19. CRM: Hitting the right target in the right way”. MIS Quarterly Executive 1(2): 79-94 20. Grabner-Kraeuter, Sonja and Gernot Moedritscher. 2002. “Alternative Approaches

Toward 21. Measuring CRM Performance”. Paper presented at the Sixth Research Conference

on 22. Relationship Marketing and Customer Relationship Management, Atlanta, USA, 2002

23. H. Salomann, M. Dous, L. Kolbe and W. Brenner. 2005. "Customer Relationship Management

24. Survey, Status Quo and Future Challenges". Institute of Information Management. University of

25. St. Gallen, January 2005 26. Hugh Wilson, Elizabeth Daniel, and Malcolm McDonald. 2002. “Factors for Success

in 27. Customer Relationship Management (CRM) Systems”. Journal of Marketing

Management, 18: 28. 193-219

29. Injazz J. Chen and Karen Popovich. 2003. “Understanding customer relationship management

30. (CRM) People, process and technology”. Business Process Management Journal, 9(5): 672-688

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