Integration of CRM system with social networks as part of quality management approach: case for a Russian regional company from beauty industry
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INTRODUCTION 7
1. STATE OF THE ART OF INTEGRATION OF CRM SYSTEM WITH SOCIAL
NETWORKS AS PART OF QUALITY MANAGEMENT APPROACH 9
1.1 Quality management approach 9
1.2 Customer relationship management system 14
1.3 Social networks in e-commerce approach 16
1.4 Beauty industry aspects under the social networks trend 18
1.5 Research gap and research goal 21
2. RESEARCH DESIGN AND METHODOLOGY FOR MULTI DISCIPLINARY
STUDY 23
2.1 Research design 23
2.2 Online questionnaire to obstacles revealing 24
2.2.1 Company and data selection process 24
2.2.2 Questionnaires design 25
2.3 Case study of small sized company in beauty industry 28
2.3.1 Case study methodology description 28
2.3.2 Detailed scheme of case study execution 30
2.4 Benchmarking approach for quality improvement implementation 33
2.4.1 Benchmarking methodology description 33
2.4.2 Detailed scheme of benchmarking execution 34
3. EMPIRICAL RESULTS OF ONLINE QUESTIONNAIRE 35
3.1 The respondents description 35
3.2 The main obstacles for social media integration 37
3.3 Social networks implementation analysis 38
4. EMPIRICAL RESULTS OF CASE STUDY ANALYSIS 41
4.1 Framework description for case study execution 41
4.2 CASE 1: Novokuznetsk School of Style analysis 42
4.2.1 Case description via quality dimensions 42
4.2.2 Actualized company’s service-oriented model analysis 46
4.3 CASE2: Ekaterinburg School of Style analysis 48
4.3.1 Case description via quality dimensions 48
4.3.2 Actualized company’s service-oriented model analysis 50
4.4 CASE 3: Novosibirsk School of Style analysis 52
4.4.1 Case description via quality dimensions 52
4.4.2 Actualized company’s service-oriented model analysis 56
4.5 Cross case analysis and comparisons via quality dimensions 57
4.6 Actualized service-oriented model under social network trend 60
5. EMPIRICAL RESULTS OF CRM AND SOCIAL MEDIA INTEGRATION 62
5.1 Benchmarking execution of process improvement 62
5.2 Procedures of changes implementation 66
5.3 Novosibirsk School of Style CRM integration results 70
6. DISCUSSION AND CONCLUSION 74
6.1 Discussion of the findings 74
6.2 Theoretical implications 76
6.3 Managerial implications 77
6.4 Limitations of the study 78
REFERENCES 81
1. STATE OF THE ART OF INTEGRATION OF CRM SYSTEM WITH SOCIAL
NETWORKS AS PART OF QUALITY MANAGEMENT APPROACH 9
1.1 Quality management approach 9
1.2 Customer relationship management system 14
1.3 Social networks in e-commerce approach 16
1.4 Beauty industry aspects under the social networks trend 18
1.5 Research gap and research goal 21
2. RESEARCH DESIGN AND METHODOLOGY FOR MULTI DISCIPLINARY
STUDY 23
2.1 Research design 23
2.2 Online questionnaire to obstacles revealing 24
2.2.1 Company and data selection process 24
2.2.2 Questionnaires design 25
2.3 Case study of small sized company in beauty industry 28
2.3.1 Case study methodology description 28
2.3.2 Detailed scheme of case study execution 30
2.4 Benchmarking approach for quality improvement implementation 33
2.4.1 Benchmarking methodology description 33
2.4.2 Detailed scheme of benchmarking execution 34
3. EMPIRICAL RESULTS OF ONLINE QUESTIONNAIRE 35
3.1 The respondents description 35
3.2 The main obstacles for social media integration 37
3.3 Social networks implementation analysis 38
4. EMPIRICAL RESULTS OF CASE STUDY ANALYSIS 41
4.1 Framework description for case study execution 41
4.2 CASE 1: Novokuznetsk School of Style analysis 42
4.2.1 Case description via quality dimensions 42
4.2.2 Actualized company’s service-oriented model analysis 46
4.3 CASE2: Ekaterinburg School of Style analysis 48
4.3.1 Case description via quality dimensions 48
4.3.2 Actualized company’s service-oriented model analysis 50
4.4 CASE 3: Novosibirsk School of Style analysis 52
4.4.1 Case description via quality dimensions 52
4.4.2 Actualized company’s service-oriented model analysis 56
4.5 Cross case analysis and comparisons via quality dimensions 57
4.6 Actualized service-oriented model under social network trend 60
5. EMPIRICAL RESULTS OF CRM AND SOCIAL MEDIA INTEGRATION 62
5.1 Benchmarking execution of process improvement 62
5.2 Procedures of changes implementation 66
5.3 Novosibirsk School of Style CRM integration results 70
6. DISCUSSION AND CONCLUSION 74
6.1 Discussion of the findings 74
6.2 Theoretical implications 76
6.3 Managerial implications 77
6.4 Limitations of the study 78
REFERENCES 81
The customer relationship management is important part for sustainable company development. The CRM approach attempts to analyze data about customers' history with a company, in order to better improve business relationships with customers, specifically focusing on retaining customers, in order to drive sales growth. Nowadays the importance of social networks is increasing significantly, which consequently has impact on customer behavior patterns and markets requirements. From socio-cultural perspectives customer moved into social networks, and the trustworthy phenomenon of social media information is observed. Due to this trend many enterprises have to adapt their business processes under this phenomenon. This is reflected in marketing and promotional strategizes, brand positioning, sales strategies and post service production. Essentially, the industry plays a significant role of this adaptation process. This master thesis focused on beauty industry, which could characterized as highly competitive and heterogeneous. To specify the research the small sized, Russian regions origins companies provides educational courses and salon services were selected to research. These companies mostly actively use the social media for sales and marketing. Not only small sized company, but also Internationals brand switched their marketing campaigns into social media. Especially for small sized companies the challenge of integration the social media within internal CRM system is becoming vitally important, because of strong dependences of their business process on social networks. Additionally, companies belonged to selected industry’s sector are mostly have service-oriented approach. Therefore the problem statement of the work is to make actual service-oriented model, describing business processes of small companies from beauty education and beauty service markets, taking into consideration the strong trend of social networks e¬commerce perspectives and describe the main reasons of gap between existing software solutions and its real business implementation. The aim of research is to increase the efficiency of planning system and employees’ performance evaluation in small sized company from beauty¬education and beauty-service markets, through integration of CRM and Social Media.
The work is consists of 6 Chapters. First chapter is observed literature from 3 main perspectives: quality management practices, and customer relationships management as one of quality management approaches (both as management practice and technological solution), social networks trend and e-commerce opportunities through social networks, and the last but not least the industry aspects under the social medial trend. The result of this chapter is the research gap revealing.
Second chapter is concerns research design and methodology. Despite of narrow focus of research, the research objective is complicated. Taking into consideration the shortage of scientific research on Russian beauty market companies, we have to implement multidisciplinary study. To explore the first part of research the online questionnaire conducted. After main obstacles, companies faced working with social networks, are clarified, to more detail exploration of gap between existing software solutions and companies business process descriptive analysis conducted. Following benchmarking approach is used to integrate social media with internal CRM solutions, based on existing best practices and case results.
Following, in chapter 3, chapter 4 and chapter 5 empirical results are presented. Questionnaire illustrates that companies firstly evaluated social networks as main sales tool, secondly they faced troubles with data collection, analyzing from networks, due to technological aspects and unsynchronized information flows. Case studies results provide information about current service-oriented model, and the changes of business process under network trend. Cross case results illustrates that process and approaches of typical companies are homogeneous, consequently results could be generalized. And finally, the best practices of integration of CRM and quality management approaches are implemented to one of the company from case study. The integration process was running during one year, because changes concern many aspects and almost all company process. The result of integration of CRM and social media has positive impact on operational cycle time and planning efficiency, which were measured after integration.
The study contributes to the theory for new paradigm of customer relationship management systems. Reveal the necessity of new approaches to sales department evaluation, due to strong dependency on customer relationship management. Also study provides theoretical recommendation for CRM launching process for small and medium sized company.
The managerial implications of the following study are aimed at the following groups of managers: 1) management of beauty industry companies, who are going to use CRM system software, 2) the sales department managers, who are going to implement measurable system of performance evaluation, 3) management of CRM solutions development companies, by clarifying customer needs and expectations.
Due to the homogeneity of business processes within this industry this recommendations could be useful for all companies operating in social media in order to improve process approach efficiency or improve measurement basis for employees’ performance.
The work is consists of 6 Chapters. First chapter is observed literature from 3 main perspectives: quality management practices, and customer relationships management as one of quality management approaches (both as management practice and technological solution), social networks trend and e-commerce opportunities through social networks, and the last but not least the industry aspects under the social medial trend. The result of this chapter is the research gap revealing.
Second chapter is concerns research design and methodology. Despite of narrow focus of research, the research objective is complicated. Taking into consideration the shortage of scientific research on Russian beauty market companies, we have to implement multidisciplinary study. To explore the first part of research the online questionnaire conducted. After main obstacles, companies faced working with social networks, are clarified, to more detail exploration of gap between existing software solutions and companies business process descriptive analysis conducted. Following benchmarking approach is used to integrate social media with internal CRM solutions, based on existing best practices and case results.
Following, in chapter 3, chapter 4 and chapter 5 empirical results are presented. Questionnaire illustrates that companies firstly evaluated social networks as main sales tool, secondly they faced troubles with data collection, analyzing from networks, due to technological aspects and unsynchronized information flows. Case studies results provide information about current service-oriented model, and the changes of business process under network trend. Cross case results illustrates that process and approaches of typical companies are homogeneous, consequently results could be generalized. And finally, the best practices of integration of CRM and quality management approaches are implemented to one of the company from case study. The integration process was running during one year, because changes concern many aspects and almost all company process. The result of integration of CRM and social media has positive impact on operational cycle time and planning efficiency, which were measured after integration.
The study contributes to the theory for new paradigm of customer relationship management systems. Reveal the necessity of new approaches to sales department evaluation, due to strong dependency on customer relationship management. Also study provides theoretical recommendation for CRM launching process for small and medium sized company.
The managerial implications of the following study are aimed at the following groups of managers: 1) management of beauty industry companies, who are going to use CRM system software, 2) the sales department managers, who are going to implement measurable system of performance evaluation, 3) management of CRM solutions development companies, by clarifying customer needs and expectations.
Due to the homogeneity of business processes within this industry this recommendations could be useful for all companies operating in social media in order to improve process approach efficiency or improve measurement basis for employees’ performance.
The aim of the present master’s thesis was to describe the business processes of small companies from beauty education and beauty service markets, through the actualizing service- oriented framework, taking into consideration the strong trend of social networks e-commerce perspectives, describe the main reasons of gap between existing software solutions and its real business implementation.
First research question relates to the revealing the main obstacles which company faced actively working with social networks. To answer on it, the questionnaire methodology was implemented. The online questionnaire was sent to 120 companies, but only 87 responses were collected (42% of response). Firstly, the results of survey are highly correlated with observed literature, because 55% of respondents evaluate social networks as main tool for leads generation. Secondly, the results illustrates that more than half of respondents faced difficulties with information overloads (58%) and serious difficulties to develop criterial basis to classify and analyze the information from social networks (72%). Taking into consideration that 30% of respondents relate to data collection as “highly important” and 45% as “important” concludes that the reason of gap in concerned technological aspects or real implementation obstacles of this approach. The main important result of survey was defined that companies are faced troubles with choosing CRM software solutions and transferring data from social network into internal database, because 39% and 58% correspondingly respondents mentioned it as “highly important” and “important”.
Second and third research question was aim to find out how company currently operate and use trend of e-commerce within their business process, how they integrate the social networks into manageable process. Also, aim to find the reasons of gap between companies’ real business process and existing technological solutions. To answer on this questions case study methodology was used. The regional companies from observing industry were selected. The case studies conducted under quality management approach, this is why the interview reflecting the quality aspects as: customer focus, leadership, involvement of people, process approach, system approach to management, continual improvement, factual approach to decision making, mutually beneficial supplier relationships. As the aim of present work is actualizing the business process under the social networks influence, the service-oriented model was selected as main framework, 74
because firstly it represent the correlation of all aspects of organization and could be used as separate on all organizational level, secondly because cases are from service-oriented organizations and we aim to reveal the quality management aspects for them. The case results illustrate that firstly all chosen company have almost the same business process and almost the same obstacles with CRM system, clients database, unsynchronized information flows from social networks. It could be conclude that industry is homogenous and results could be transferred and implemented to the same small sized companies. Secondly, they have different level of technological automatization and different approaches, which allowed silhouetting the track of companies’ development and correlation between approaches and results. It is necessary to emphasizes that cases studies had descriptive nature and the conclusions we obtained only describes reality of regional companies. Results illustrates that business process of companies changed under social networks influence and became a significant part for all observed cases. Company mentioned that sales mostly provides within social network, and they evaluate networks more sales instrument them marketing or brand tool. The incorporation of networks into companies brings more troubles with control and process evaluation. Firstly, without special software solution it is almost impossible to collect, classify and analyze the information from customer and leads within networks. In context of highly competitive and quickly developed market it became a serious risk for a company. Secondly, to improve and manage service level became a challenging task, again due to all customer communication is run within social networks. Thirdly, company couldn’t evaluate the efficiency of process, employees’ performance or any adequate KPI’s without transferring and fixing the customer communication. If we are talking about the reasons of existing gap between the companies’ requirements and existing technological solutions the reasons are various. Due to the cases results the common problem for all observed companies was low level of acquisitions with possibility to directly connect the CRM with network. The tendencies of CRM implementation are overlooked within the observation, companies start from some internal Excel spreadsheets than implement CRM with software solutions. Also, the technological aspects remain the main. Companies mentioned that packages solutions couldn’t bring fast result and companies are afraid to invest to customizing of CRM solutions. The last, but not least revealed reason is that implementation of any software automatization required changes in any management’s levels. This process is time and money consuming, requires changes in all process and employees adaptation. Without clear value proposition from software companies it will be impossible to perceive the beauty company to install automatization system.
Fourth research question was about approbation of existing methodologies and best practices of integration social networks in order to improve business process efficiency for one case-company. To answer on this research question the benchmarking methodologies was used. In order to provide best recommendation the cases results and best practice of changes implementation from aligned industry were used. As main drivers of benchmarking the employees’ performance efficiency, planning process transparence and operational managers’ time per one client reduction were chosen. The detailed list of recommendation, from internal, external, and integration of them perspectives of view is provided. Due to the homogeneity of business processes within this industry this recommendations could be useful for all companies in order to improve process approach efficiency or improve measurement basis for employees’ performance. This instruction provides information on question “what” company should take into account in order to improve their process under revealing trend. Secondly, the detailed instructions of changes implementation were presented. The instruction consists of 9 steps, on sales department example. Nevertheless it would be generalized to another departments or management objects. This approach helps on answer “how” to run changes within companies, what stakeholders should be involved into this process, and reveal the main problems which usually arise. The last, and main important result is the numerical evaluation of approbation this instruction on a company. The results illustrates that the integrated social networks could bring to the company measurable benefits on different management levels. Firstly, the planning process becomes easy to run. Secondly, company has ability to conduct measurable KPI system for marketing and sales strategy. Thirdly, the role of each employee of sales department could be tracked and analyzed. The obtained results illustrate the reduction of time per each client could be reduced almost by 20%, and transparency of business process could be increased by 25%.
First research question relates to the revealing the main obstacles which company faced actively working with social networks. To answer on it, the questionnaire methodology was implemented. The online questionnaire was sent to 120 companies, but only 87 responses were collected (42% of response). Firstly, the results of survey are highly correlated with observed literature, because 55% of respondents evaluate social networks as main tool for leads generation. Secondly, the results illustrates that more than half of respondents faced difficulties with information overloads (58%) and serious difficulties to develop criterial basis to classify and analyze the information from social networks (72%). Taking into consideration that 30% of respondents relate to data collection as “highly important” and 45% as “important” concludes that the reason of gap in concerned technological aspects or real implementation obstacles of this approach. The main important result of survey was defined that companies are faced troubles with choosing CRM software solutions and transferring data from social network into internal database, because 39% and 58% correspondingly respondents mentioned it as “highly important” and “important”.
Second and third research question was aim to find out how company currently operate and use trend of e-commerce within their business process, how they integrate the social networks into manageable process. Also, aim to find the reasons of gap between companies’ real business process and existing technological solutions. To answer on this questions case study methodology was used. The regional companies from observing industry were selected. The case studies conducted under quality management approach, this is why the interview reflecting the quality aspects as: customer focus, leadership, involvement of people, process approach, system approach to management, continual improvement, factual approach to decision making, mutually beneficial supplier relationships. As the aim of present work is actualizing the business process under the social networks influence, the service-oriented model was selected as main framework, 74
because firstly it represent the correlation of all aspects of organization and could be used as separate on all organizational level, secondly because cases are from service-oriented organizations and we aim to reveal the quality management aspects for them. The case results illustrate that firstly all chosen company have almost the same business process and almost the same obstacles with CRM system, clients database, unsynchronized information flows from social networks. It could be conclude that industry is homogenous and results could be transferred and implemented to the same small sized companies. Secondly, they have different level of technological automatization and different approaches, which allowed silhouetting the track of companies’ development and correlation between approaches and results. It is necessary to emphasizes that cases studies had descriptive nature and the conclusions we obtained only describes reality of regional companies. Results illustrates that business process of companies changed under social networks influence and became a significant part for all observed cases. Company mentioned that sales mostly provides within social network, and they evaluate networks more sales instrument them marketing or brand tool. The incorporation of networks into companies brings more troubles with control and process evaluation. Firstly, without special software solution it is almost impossible to collect, classify and analyze the information from customer and leads within networks. In context of highly competitive and quickly developed market it became a serious risk for a company. Secondly, to improve and manage service level became a challenging task, again due to all customer communication is run within social networks. Thirdly, company couldn’t evaluate the efficiency of process, employees’ performance or any adequate KPI’s without transferring and fixing the customer communication. If we are talking about the reasons of existing gap between the companies’ requirements and existing technological solutions the reasons are various. Due to the cases results the common problem for all observed companies was low level of acquisitions with possibility to directly connect the CRM with network. The tendencies of CRM implementation are overlooked within the observation, companies start from some internal Excel spreadsheets than implement CRM with software solutions. Also, the technological aspects remain the main. Companies mentioned that packages solutions couldn’t bring fast result and companies are afraid to invest to customizing of CRM solutions. The last, but not least revealed reason is that implementation of any software automatization required changes in any management’s levels. This process is time and money consuming, requires changes in all process and employees adaptation. Without clear value proposition from software companies it will be impossible to perceive the beauty company to install automatization system.
Fourth research question was about approbation of existing methodologies and best practices of integration social networks in order to improve business process efficiency for one case-company. To answer on this research question the benchmarking methodologies was used. In order to provide best recommendation the cases results and best practice of changes implementation from aligned industry were used. As main drivers of benchmarking the employees’ performance efficiency, planning process transparence and operational managers’ time per one client reduction were chosen. The detailed list of recommendation, from internal, external, and integration of them perspectives of view is provided. Due to the homogeneity of business processes within this industry this recommendations could be useful for all companies in order to improve process approach efficiency or improve measurement basis for employees’ performance. This instruction provides information on question “what” company should take into account in order to improve their process under revealing trend. Secondly, the detailed instructions of changes implementation were presented. The instruction consists of 9 steps, on sales department example. Nevertheless it would be generalized to another departments or management objects. This approach helps on answer “how” to run changes within companies, what stakeholders should be involved into this process, and reveal the main problems which usually arise. The last, and main important result is the numerical evaluation of approbation this instruction on a company. The results illustrates that the integrated social networks could bring to the company measurable benefits on different management levels. Firstly, the planning process becomes easy to run. Secondly, company has ability to conduct measurable KPI system for marketing and sales strategy. Thirdly, the role of each employee of sales department could be tracked and analyzed. The obtained results illustrate the reduction of time per each client could be reduced almost by 20%, and transparency of business process could be increased by 25%.
