ELECTRONIC CUSTOMER RELATIONSHIP MANAGEMENT An Introduction

By | February 9, 2018

INTRODUCTION

 

In the field of information systems (IS) the idea of considering the customer as an asset and a source of value is not a new one. Ives and Learmonth (1984) proposed the customer resource life cycle for use in IS, and later Ives and Mason (1990) described how information technology (IT) can be used to revital- ize a firm’s customer service. These early forays into the realm of customer relationship management (CRM) were not immediately followed by a large volume of published articles on the topic, let alone by practice in the IS field. As is often the case, somewhat visionary articles preceded mainstream research on the topic by several years. Although articles on CRM may have been published in other disciplines, particularly marketing, before or at the same time as these two seminal IS articles, these were the first we found in an extensive literature review of IS-CRM (Romano and Fjermestad 2001– 2002). We have not replicated that extensive study, primarily because the continued and accelerated growth of literature into CRM in IS makes it impractical, but also because many of the suggestions we made there can be readily observed to have been implemented in the literature.

When we performed that study of IS-CRM, we recommended six lines of development that would promote and indicate the maturation of CRM as an MIS subfield of study: One, develop- ment of empirically testable CRM theories; Two, conducting of lab and field experiments to test

hypotheses based on theory; Three, development and use of valid instruments; Four, develop- ment of a cumulative tradition of research and replication, extension of theories, models, and instruments, and development of standard constructs and metrics; Five, additional publication of IS-CRM research in top MIS journals; and Six, development of new classification schemes for rapidly changing terminology. Four years later, we believe it is meaningful to revisit the literature and see whether our suggestions have been accepted or ignored.

In the remainder of this introduction we address, first, the state of IS-CRM research in terms of each of our earlier recommendations for future research. Next we overview and introduce the chapters in this volume on CRM advances and issues. Finally we suggest additional issues and challenges that researchers and practitioners in CRM still face in terms of IS.

 

CRM AND ECRM

 

CRM has changed over the years from a customer service business unit loosely linked to market- ing to an electronic dynamo attempting to maximize the value of existing customer relationships. Dyché (2002) in her CRM Handbook suggests that CRM is the infrastructure that enables the delineation of an increase in customer value, and the correct means by which to motivate valuable customers to remain loyal—to buy again. The key words are infrastructure and enables. The infrastructure consists of the people and processes that an organization has at its disposal to un- derstand, motivate, and attract its customers. It is the technology that enables the organization to improve customer service, differentiate customers, and deliver unique customer interactions.

For one company, Wal-Mart (Swift 2001), the infrastructure is an enterprise data warehouse. This eCRM system enables the company to collect massive amounts of data to manage the ever- changing needs of customers and the marketplace. Coupled with people and process, it permits the integration of operational data with analytics, modeling, historical data, and predictive knowl- edge management to give its customers what they need and want at the right time.

CRM and eCRM are about firms capturing and keeping customers through the Internet in real time (Greenberg 2002). CRM is about customers interacting with employees, employees collaborating with suppliers, and every interaction’s being an opportunity to maintain and improve a relationship.

 

THE STATE OF IS-CRM RESEARCH

 

In keeping with methodological literature (Keen 1980; Vogel and Wetherbe 1984; Alavi and Carlson 1992; Pervan 1998), implementation of our six recommendations (Romano and Fjermestad 2001– 2002) would indicate that IS-CRM research is maturing as a subfield of MIS. Here we discuss the current status of each of these areas to determine whether the subfield is growing and maturing or waning and failing to bear fruit.

 

Theory Development

 

In our study of IS-CRM (Romano and Fjermestad 2001–2002) we found only three theoretically ori- ented articles out of 369. Clearly one indicator that the IS-CRM subfield is beginning to mature would be the development of meaningful theories or the use of relevant theories from reference disciplines that logically lead to testable hypotheses. Specifically we put forth the following recommendation:

 

“First, there is clearly a need for empirically testable theories. While conceptual models, frameworks, and overviews all provide an excellent start, testable theories can lead to mean-

 

 

ingful hypotheses that can be experimentally tested in the lab and the field to move research forward.” (Romano and Fjermestad 2001–2002, p. 85)

 

Since 2001, a number of IS-CRM papers that specifically address employing useful theory have been published. We briefly review here some of the papers that have developed IS-CRM theoretical models. Susarla, Barua, and Whinston (2002) developed a theoretical framework that can be em- pirically tested. Madeja and Schoder (2003) investigated how eight concepts derived from the me- dia characteristics of the World Wide Web (Web) impact corporate success in e-business if implemented as features of companies’ Web sites, and they constructed a path model for testing their research hypotheses. Chen, Gillenson, and Sherrell (2004) expanded on the technology accep- tance model (TAM) (Davis 1989) and innovation diffusion theory (Rogers 2003) to provide impor- tant theoretical contributions to the area of business-to-consumer (B2C) e-commerce. Komiak and Benbasat (2004) proposed a new theoretical trust model that differentiated between cognitive trust and emotional trust and defined customer trust in each type of commerce as cognitive trust and emotional trust in the various entities. They developed eight propositions and hypotheses for future researchers to test. These four excellent papers, among many similar ones we found, clearly illus- trate that IS-CRM research is maturing in terms of theory development. We therefore believe that our first recommendation is being implemented by IS researchers within the literature.

In our study of IS-CRM (Romano and Fjermestad 2001–2002) we observed that few studies were based on existing theories, from either IS or its reference disciplines. Here we review a few of many studies that, while they have not extended existing theory or developed new theory, are theory based and employ existing theory. Chai and Pavlou (2002) apply the theory of planned behavior (TPB) (Ajzen 1991) to study behavioral intentions to transact in two dissimilar countries and de- velop a cross-cultural e-commerce adoption model. Levina and Ross (2003) analyze and interpret data from the case of vendor strategy and practices in one long-term successful applications- management outsourcing engagement using the economic theory of complementarity in organiza- tional design (Milgrom and Roberts 1995), and from the standpoint of client-vendor relationship factors. They explain the IT vendors’ value proposition and how vendors can offer benefits that client firms cannot readily replicate internally. These and many similar papers now being published further demonstrate that IS-CRM research is maturing in terms of its use of theory.

 

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