VIETNAM NATIONAL UNIVERSITY, HANOI SCHOOL OF BUSINESS NGUYEN THI THANH TU A STUDY ON CUSTOMER RELATIONSHIP MANAGEMENT OF ILA Major: Business Administration Code: 60 34 05 MASTER OF BUSINESS ADMINISTRATION THESIS Supervisor: Dr Tran Doan Kim Hanoi – 2011 TABLE OF CONTENTS ACKNOWLEDGEMENT i ABSTRACT ii TÓM TẮT iv TABLE OF CONTENTS vi LIST OF FIGURES ix LIST OF TABLES x INTRODUCTION .1 The thesis title The thesis necessity Objectives Scale of sample Type of research Research approach Data sources and Processing .3 Research method .3 Research questions 10 Significance 11 Limitations .4 12 Expectation 13 Disseminations .4 14 Follow-up .5 15 The thesis structure vi CHAPTER LITERATURE REVIEW Conception of Customer relationship .6 1.1 Root of relationship 1.2 Characterize of relationship 1.3 Relationship – value of company Customer relationship management (CRM) 11 2.1 Definition of CRM .11 2.2The use of CRM during times .12 The importance of CRM toward corporations 14 3.1 Benefit of CRM 14 3.2 CRM success factors 16 Basic model of CRM 17 CHAPTER ANALYSIS AND ASSESMENT ON CUSTOMER RELATIONSHIP MANAGEMENT AT ILA 31 2.1 About ILA 31 2.1.1 Introduction about ILA 31 2.1.3 ILA principle .32 2.2 Assessment on Customer relationship management in ILA 34 2.2.1 Research method description 34 2.2.2 Description of the Research process 35 2.2.3 The research survey and results 37 2.2.4 Interview result 44 2.2.5 Report research 47 2.2.6 Current loyal programmes 51 vii CHAPTER RECOMMENDATIONS TO IMPROVE THE CUSTOMER RELATIONSHIP MANAGEMENT AT ILA 55 3.1 CRM – Training programme for ILA people – Create a CRM view 55 3.2 Improve Customer relationship software 58 3.2.1 It is not necessary to use complicated solution when simple solution does 58 3.2.2 Employees at all level can collect information 58 3.2.3 Tools should be customer-employee friendly 59 3.2.4 Report data need to be used, use data reported 64 3.3 Applying CRM model in improving CRM in getting, maintain and growing customers 66 3.3.1 CRM in getting and growing customers activities 66 3.3.2 CRM in maintaining customers – Building relationships 70 3.3.3 Privacy 76 3.3.4 Metric for measuring the success of CRM .77 CONCLUSION 79 APPENDIX .80 viii LIST OF FIGURES Figure 2.1 Training centres .32 Figure2 2The interest in CRM between Academic and Business departments .37 Figure2 ILA's perception about CRM 37 Figure The benefit of CRM for business operation 38 Figure 2.5 Criticise of CRM from Business group 39 Figure 2.6 Satisfaction about ILA's communication 42 Figure 2.7 Satisfation about loyalty programme .43 Figure 2.8 Judgment ILA's problem solving .43 Figure 2.9 New sales based on programmes .49 Figure 2.10 Re-enrolment based on programmes .49 Figure 2.11 Sources to receive complaints .50 Figure 2.12 Times to solve problems 51 Figure 13 Satisfaction about problem solving 51 ix LIST OF TABLES Table 2.1 Number of Training centres 32 Table 2 Number of responsed questionnaire 36 Table 2.3Tools to get ILA information 41 Table 2.4 Visitors based on programmes 48 Table 2.5 New sales based on programmes 49 x INTRODUCTION The thesis title A study on Customer relationship management of ILA The thesis necessity ILA was established in 2000 in Ho Chi Minh City and opened Training Centre Hanoi in 2007 After four years of operation, ILA Hanoi has not been known on a large area Thus, attracting new students is very difficult without the help from the marketing department of Head office Therefore, in order to stabilize the company‘s revenue, it has become more urgent to make the existing customers more loyal to ILA Thus, it is a necessity to have a suitable system of managing customers to get the loyalty from the existing customers of ILA, to remain the service quality and fulfill the programme design, to motivate the employees to contribute for the customer relationship management of company honestly Having been operated well but ILA Hanoi is coping with many difficulties from competitors All the plausible reasons above lend me strong grounds enough to choose the topic: ―A study on Customer relationship management of ILA‖ for my MBA graduation thesis Objectives The objectives of this thesis are: (a) Review and summarize the theory of Customer relationship management (b) Apply the reviewed literature to analyze and access the managing customer relationship in ILA now (c) Propose some recommendations to enhance the customer relationship management in ILA, contributing to the tangible and intangible profit of the company Scale of sample Sampling unit: ILA staff, current students and alumni Sampling size: This thesis only does the research on ILA Hanoi branch including 01 Academic manager, 01 Training center manager and teachers and staff, 250 students and parents who chosen randomly ILA staff 50 ILA current student 200 ILA alumni 50 Sampling process: During last months, the author conducts the interview (both collecting questionnaire and directly interview) Type of research The writer chooses the type of research is analytical because analytical research often extends the descriptive approach to suggest or explain why or how something is happening Reminds about descriptive, descriptive research can be used to identify and classify the elements or characteristics of the subject With the combination of descriptive and analytical research with analytical plays a main role, the author locates and identifies the different factors (or variables) involved Quantitative techniques are most often used to collect, analyze and summarize data Research approach The author urged to identify the main variable which causes low revenue at ILA Hanoi Due to the large range of factors, the author collected facts and figures to find out specific problems Quantitative is very supportive Although the quantitative is harder to design initially, the writer still apply it because it brings highly detailed and structures and results can be easily collated and presented statistically To well prediction, the author also use qualitative research It is more subjects in nature then quantitative research and involves examining and reflecting on the less tangible aspects of a research subject Data sources and Processing Primary data was collected from questionnaire and interview Secondary data has been performed by research of documents, annual/quarterly reports of ILA and internet sources The author conducts this research by collecting both primary and secondary information To analyze the operating situation, the author use secondary with filtering the useful information to have the big picture but supportive detail This data is not only for this research, the author has the ambition to use them for our suggestion with the Board of director because it is from the real situation Research method Case study Survey method using questionnaire, Interview focus group, Desk research method was applied in this paper Research questions (a) Which theories can be applied in Customer relationship at ILA (b) What current situation of Customer relationship management at ILA (c) How to improve Customer relationship management at ILA 10 Significance By reviewing the theory of customer relationship management, this research benefits ILA in recommendation to apply method of increasing loyal customers, from that increase the reputation and improve the revenue, which contribute to the company‘s development 11 Limitations The study is limited in the sense that small scale of sample in interview and questioning Furthermore, the method of managing CRM requires a certain standard of technology which meets some requirement in restructure and software Finally, this thesis just runs the research on products offered to individual, not corporate field; the profit flow from corporate party counted in this thesis is eliminated Thus, the solution applicability for other English training centers may cope with certain difficulty or limitation 12 Expectation The new kind of managing relationship between company and customers is assessed and some appropriate recommendations are proposed The same methodology can be applied in the scenario of other companies in inspection industry with little adjustment 13 Disseminations The result of study will be useful for operation of ILA in particular and for other English centers in general Many new services project might apply the method of research and the recommendations, the conclusion of the study, from which they can get useful information before starting new plan The frame of reference on the other hand could be interesting for new customers when they have to find the English centre for their improvement of learning English process in future 11 Do you want the second ILA centre in Hanoi? B3 List of interviewed people Ms Pham Thi Ngoc Lan (parent) – VIP 0001 Ms Hoa Thi Ngoc Anh (parent) – VIP 0005 Mr Nguyen Viet Ninh (student) Ms Doan Thi Huong (parent) – VIP 0030 Mr Truong Trung Nghia (student) Ms Dang Thu Phuong (parent) Ms Nguyen Thu Thuy (parent) – VIP 0076 Mr Le Trung Hieu (student) Ms Tran Thi Viet Binh (parent) – VIP 0132 Mr Nguyen Viet Son (student) 89 QUESTIONNAIRE RESULTS For ILA staff Customer relationship is the task of Creating, maintaing and expanding customers Maintaing customers Total Answer % 47 50 6% 94% 100% Which are the benefit of CRM for business operation? Benefit Answer Staff % Increase revenue 14 35.71% Identify needs 10 14 71.43% Cross-selling/alternatives 14 35.71% Identify who is profit or not 14 50.00% Effective marketing 14 64.29% Improve product 14 42.86% Collect, review, analyze data, response 14 21.43% Build reputation 11 14 78.57% Evaluation Question Very bad What you think about current CRM in ILA % Does ILA use any kind of data management system? % Bad 0% 0% 90 Very good Neutre Good 10% 0% 30% 0% 40% 0% 20% 0% Total 10 100% 100% Does ILA keep database in safe? % Is all customers’ information saved in data management system? % How does ILA's schoolsoft work? % How is ILA's loyal programme? % How is ILA's customer attracting activities? % For customers Tools to get information about ILA Website Press Advertorial Fly distribution Direct mail Email Online advertisement TV PopUp Billboar Banner Friend-relatives recomment 0% 11 85% 15% 0% 0% 13 100% 0% 0% 0% 0% 10 77% 10 83% 10 83% 62% 23% 8% 17% 38% 0% 8% 0% 0% 0% 0% 0% 0% 13 100% 12 100% 12 100% 13 100% 121 0 421 % 19.24% 0.32% 0.16% 0.48% 0.00% 0.00% 0.16% 0.32% 0.00% 0.64% 66.93% Answer 91 Promotion Other Total 32 5.09% 42 6.68% 629 100.00% Method prefered to be communicated by ILA? Method Face to face Phone Email Facebook SMS Letter Total Satisfaction about loyalty programmes Satisfactory Unsatisfactory Neutral Total Answer 57 76 38 191 % 29.84% 39.79% 19.90% 4.71% 3.66% 2.09% 100.00% 62 123 20 205 % 30.24% 60.00% 9.76% 100.00% Answer Evaluation Question Very bad How is ILA staff problem solving skill? Bad 92 Total Very good Neutre Good 197 205 % How is ILA policy? % How is ILA complaint solving method? % 0% 0% 92 45% 0% 122 60% 0% What will you when you have a complaint? Tell teacher directly Tell customer care staff directly Email ILA Make a phone call to ILA Do nothing and don't register next course Total Prefered promotion Bring a friend Use Vietcombank card Discount on special occasions (New Year, Christmas, National Day, etc) Lucky draw (Iphone, Ipad, Scholarship, Recorder, etc) Answer % 19 142 24 190 Answer 10% 75% 0% 3% 13% 100% % 13 163 1% 29 207 93 79% Early bird (discount for limited number of customer) Total 6% 0% 14% 100% 2% 20 10% 41 20% 96% 61 30% 51 25% 1% 0% 20 10% 100% 203 100% 204 100% 10 Teaching assistants' responsibilities Evaluation Responsibilities Very bad Calling report % Check homework % Help students % Answer parents' question % Bad 0% 0% 0% 0% Very good Neutre Good 3% 2% 0% 0% 0% 0% 2% 1% 179 91% 175 89% 193 98% 188 96% 12 6% 18 9% 0% 4% Total 196 100% 196 100% 196 100% 196 100% Report research Business Programmes Jumpstart Juniors Senior Elite Placement test Visit 84 105 265 205 80 55 62 39 94 New sales 57 142 43 10 No of No of students Restudents go up to enrolment finished next class class 0.60741 135 82 0.72956 318 232 0.48031 127 61 0.3 10 Total EY Adult Total EA Total for all 491 223 223 714 404 241 241 645 1 10 % 10.00% 10.00% 80.00% 100.00% Sources to receive complaints From customer satisfaction survey Receive complaint directly in class Customers talk with staff outside class Total Record Time to solve problem day days Within week Over week Total Record Satisfaction of customer Satisfactory Unsatisfactory Total Students % 2 10 % 11 95 0% 20% 20% 60% 100% 55% 45% 100% 252 97 97 349 0.63486 0.35811 0.35811 0.57576 545 148 148 693 346 53 53 399 Ho Chi Minh 402 Nguyen Thi Minh Khai, District Tel: +84 3929 0100 Fax: +84 3929 0070 Email: info@ilavietnam.com Ho Chi Minh 2nd Floor, e.town.ew, 364 Cong Hoa, Tan Binh District Tel: +84 3810 8955 Fax: +84 3810 8956 Email: info@ilavietnam.com Ho Chi Minh 51 Nguyen Cu Trinh, District Tel: +84 3838 6788 Fax: +84 3838 6790 Email: info@ilavietnam.com Ho Chi Minh 6th Floor, C.T Plaza, 60A Truong Son, Tan Binh Distric Tel: +84 6297 2008 Fax: +84 6297 2009 Email: info@ilavietnam.com Ho Chi Minh 3rd Fl., Mirae Business Center, 268 To Hien Thanh, District 10 Tel: +84 3868 3421 Fax: +84 3868 3422 Email: info@ilavietnam.com Ho Chi Minh 5th Floor, Hung Vuong Plaza, 126 Hung Vuong, District Tel: +84 2222 0201 Fax: +84 2222 0202 Email: info@ilavietnam.com Ho Chi Minh 456 Phan Xich Long, Phu Nhuan District Tel: +84 3990 3470 Fax: +84 3990 3460 Email: info@ilavietnam.com Vung Tau 4th Floor, 155 Nguyen Thai Hoc Tel: +84 64 3572 347 Fax: +84 64 3572 350 Email: info@ilavietnam.com Ha Noi 299 Cau Giay, Cau Giay District Tel: +84 2220 1666 Fax: +84 2220 1667 Email: info@ilavietnam.com Da Nang 66 Vo Van Tan, Thanh Khe District Tel: +84 511 364 7444 Fax: +84 511 364 6333 Email: info@ilavietnam.com 96 97 98 99 APPENDIX SOME REFERENCE ACTICLES CRM Solutions Applied in the Food Industry Please note it is your responsibility to evaluate the accuracy, completeness and usefulness of any information, opinion or advice contained in the content below Today I am showing two small cases of companies in the food sector who have successfully applied a CRM solution for their organization The intend was totally different for each One did needed a simple tool to manage sales orders The other needed a solution for managing large marketing promotional campaigns Both realized benefits, both realized simple solutions that a CRM software could deliver These two case studies are not leading edge; rather they are typical applications Case I: National Foods Adopted NetSuite CRM National Foods is one of Australia‘s largest food companies, concentrating on milk and dairy foods Food industry is characterized by perishable produce, and thus timely communication and go-to-market requirements, as well as very long product lists (SKUs) and non-matching product numbering between supplier, National Foods in this case, and food retailers such as supermarkets, milk bars and delis Whereas by industry norm, area managers are used to manage the retail supply chain, National Food‘s had started a pilot telemarketing team to contact and sell to its various customers, directly over the phone In the pilot, the telemarketing team used Microsoft Excel to managed its sales and customer information Shortly after inception, telemarketing already proved to be cost effective For the next step, the team realized it needed an integrated CRM system to make it truly effective Their start-up scenario had several challenges: beyond lacking CRM 100 capabilities, the current process was time consuming and there was no transparency of information National Foods adopted ‗NetReturn‘ from NetSuite for its still only 3-man -strong telemarketing team It was used for outgoing calls, with a full CRM cycle from lead to prospect and sale ―The full customer trail is held on NetSuite, allowing the telemarketing team to see sales and order history, any outstanding orders or problems and demographical statistics (i.e what the customer might want to buy) in seconds.‖ reports NetSuite CRM Benefits National Foods chose this CRM package as a lowest-cost, least-resources solution They needed a simple, effective CRM solution that‘s reliable The telemarketing team realized the following benefits from their new CRM system: * Easy access to customer information * Autonomy thanks to flexibility of solution * More control over team work process * Streamlined call procedures * Streamlined business work process * Ease-to-manage browser interface require minimal usage training * Scalable solution suitable for departmental growth * Minimal IT costs / No need for IT investment in servers, software, system establishment cost nor ongoing support because NetSuite offers a hosted, fee-based CRM service Conclusion – National Foods’ CRM for Sales-support What National Foods did right is adopting CRM in the early growth phase of its departmental development This way, the strategic mission and basic processes of the organization are clarified Now, the CRM application can grow and develop alongside with the departmental growth It seemed well poised to realize enhanced sales with its new CRM system along with other benefits 101 Case II: Global food conglomerate Adopts Siebel with CRM Consultants The next case shows how a consumer goods company can device a CRM solution for marketing, brand building and promotional support The global consumer goods market constantly faces new strategic and go-to-market challenges and an altering the competitive landscape for brand manufacturers The marketing team of this global leader in branded foods and beverage company faced challenges in effective marketing campaign management, in particular its magazine / Recipe By Email (RBE) marketing campaign programs The marketing team was challenged by two factors: * lack of quality data * unscalability of current systems as was required to manage operations These two factors led to longer cycle times for running campaigns In addition, the company was not able to reach its customer base effectively In short, it needed an effective process to support its marketing task To reach its consumers effectively and develop consumer relationships across a vast group of consumers in US and Canada, the food company implemented Siebel‘s Marketing module The food company chose Infosys as its CRM consulting partner due its strong relationship with the company, vast Siebel expertise and a cost effective methodology to provide support and maintenance solution for the Siebel applications Infosys provided a stable support and maintenance to the food company‘s system operations The solution also ensured quality data to enable the food conglomerate to run campaigns more effectively Infosys facilitated rapid country roll-outs in an effective and timely manner CRM Benefits The switch to Siebel CRM in the way that it did, the food company realized a wide range of marketing and business advantages: 102 * Enabled the company to serve its new and old customers better * Increased overall consumer response to the campaign programs * Enabled the company to reach more customers, thus increasing the subscription * Reduced operational cost * Led to optimal utilization of resources which allowed the company to focus on strategic business needs * Provided substantial cost savings (which gave an opportunity to the company to invest in business design and leverage Siebel functionalities further) * Helped in continuous improvement * Ensured high-system availability, leading to improved business performance * Enhanced quality of data for effective campaign management Conclusion – Siebel CRM to build Marketing Customer Relationships for a Large Company As implementing CRM into an established organization is infinitely more challenging, it made sense that the food company adopted a consulting partner in its pursuit of implementing a sophisticated CRM solution While industries have common characteristics, it is more important to evaluate the totality of factors involved before decidiing on an industry specific CRM vendor By sound analysis of the business needs to be met with by the CRM solution, companies can create a ‗win/win‘ scenario for all around: its better-served customers, its better-equipped customer liaison teams, and its enhanced bottom line (Case studies sources: NetSuite, Infosys & Siebel) 103 ... situation of Customer relationship management at ILA (c) How to improve Customer relationship management at ILA 10 Significance By reviewing the theory of customer relationship management, this research... information systematically and have the spare plans to avoid unexpected things 30 CHAPTER ANALYSIS AND ASSESMENT ON CUSTOMER RELATIONSHIP MANAGEMENT AT ILA 2.1 About ILA 2.1.1 Introduction about ILA. .. ILA The basic model of CRM contains a set of basic components: (1) A database of customer activity, (2) Analyses of the database, (3) Given the analyses, decisions about which customers to target,