Quantifying the influence of a customer relations management (CRM) approach on performance in a sales and distribution organisation
Abstract
The current South African economy is under immense financial and competitive pressure. Entities in all segments of the industry are closing their doors due to the lack of generating sales. Companies are revising customer-orientated management strategies to increase sales revenue. Companies are making it a top priority to focus on their CRM-approach, more specifically the implementation and execution of certain policies and processes, to quantify the outcome. Organisational performance and measurement encompass the management of continuous improvement of business processes and the quality of the goods or services that are the yield of those processes, that will satisfy the needs of customers. Achieving organisational performance requires comprehensive cooperation between all organisation functions, to fulfil customer demands in the most efficient way; better phrased as TQM, more specific to the CRM approach. The primary research question was developed from the ideologies and principles reviewed in the paragraph above, stating that critical success factors of the CRM approach, which could be quantified and gauged in a dynamic model will drive performance of the organisation`s salesforce and overall organisational performance (company revenue). The study was conducted on a single organisation with a national footprint, supported via four branches; Johannesburg, Durban, Cape Town and Port Elizabeth. The CRM model discussed and validated in this study, at the time of the study was already in use, with a construction arrangement of Internal and External variables to enumerate on a final value. An average CRM coefficient was determined for the organisation specific to this study, by calculating a CRMơ for the specified sales representatives at each regional branch of the organisation, which then delivered an average CRMơ per regional branch and ultimately an overall average CRMơ for the organisation per year could then be calculated and compared with the actual company turnover for the specified year. The study followed an objectivist research paradigm and used methods that are commensurate with a positivist epistemology. Deductive reasoning with empirical testing of the theory was applied. The population of the study was the entire salesforce of The Corporation which equated to 40 sales representatives. Due to experience limitations, pertaining to the COVID-19 epidemic only 18 sales representatives were included in the sample to extract, manipulate and analyse data. The study established that customer relations management plays a critical role in the circular economy of an organisation. CRM is undoubtedly a dynamic approach to drive overall performance for any organisation.