Examination Paper: Customer Relationship Management
1
IIBM Institute of Business Management
IIBM Institute of Business Management
Examination Paper MM.100
Customer Relationship Management
Section A: Objective Type (30 marks)
•This section consists of Multiple Choice questions & Short notes type questions.
•Answer all the questions.
•Part One questions carry 1 mark each & Part Two questions carry 4 marks each.
Part One:
Multiple Choices:
1. High congruence means:
a. High probability of success
b. Low probability of success
c. Zero probability of success
d. None of the above
2. Novo Jim’s excellent resource book for Recency, Frequency and Monetary is:
a. Drilling high
b. Digging the top
c. Cutting edges
d. Drilling down
3. What stands for ‘R’ in FURPS?
a. Responsibility
b. Resource
c. Retention
d. Reliability
4. NAICS stands for:
a. National American Industry Coding System
b. North American Industry Cooling System
c. National American Industry Cooling System
d. North American Industry Coding System
5. The book ‘Reengineering the corporation’ was written by:
a. Michael Hammer and James Champy
b. Michael Champy and James Hammer
c. Michael Douglus and James Ferrari
d. Michael Ferrari and James Douglus
6. The book ‘Building the Data warehouse’ was written by:
a. Michael Doglus
b. James Champy
c. Bill Inmon
Examination Paper: Customer Relationship Management
2
IIBM Institute of Business Management
d. James Ferrari
7. Which is considered as the bible of database marketing?
a. ‘Drilling High’
b. ‘Building the Data warehouse’
c. ‘The complete database marketer’
d. ‘Drilling down’
8. CASE stands for:
a. Customer Aided Software Engineering
b. Computer Aided Software Engineering
c. Customer Aided System Engineering
d. Computer Aided System Engineering
9. What stands for ‘B’ in BBB?
a. Bail
b. Buffer
c. Bureau
d. Block
10. If high quality is one of the attribute then:
a. It will be suicidal to ship products with high DOA
b. It will be beneficial to ship products with high DOA
c. It will be suicidal to ship products with low DOA
d. It will be beneficial to ship products with low DOA
Part Two:
1. Why e- CRM is important in present life?
2. Describe the 3 phases of ‘Waterfall Model’.
3. Write the significance of ‘N/13 Test’ prioritization.
4. What is ‘Life time value’ related with customer?
5. What are ‘Warehouse data(s)’?
END OF SECTION A
Examination Paper: Customer Relationship Management
3
IIBM Institute of Business Management
Section B: Caselets (40 marks)
•This section consists of Caselets.
•Answer all the questions.
•Each Caselet carries 20 marks.
•Detailed information should form the part of your answer (Word limit 150 to 200 words).
Caselet 1
Project Energized:
Indian Synthetics Limited was established in the year 1987 by Seth Gopichand, who was an NRI based
in Singapore. The company’s main products were blended synthetics, polyester and cotton yarn; which
were suitable for readymade garments. The company had achieved an outstanding success with an
annual turnover of Rs. 1,500 crores and was awarded the ‘Exporter of the Year Award’ since 1988, for
four consecutive years by the Government of India. Encouraged by the profitability of the Jabalpur
plant, the company set up another manufacturing plant at Nasik. The company was a typically family
run business wherein no outsiders were inducted at the top management positions. Even the Chartered
Accountant was from the family. The plant at Jabalpur had 1,300 workers with an average age of 28
years and an educational qualification of either high school or secondary school. 60 percent of the
workers were from Bihar and the rest were from Orissa. They were highly paid with reference to the
industry average and were provided with residential accommodation on the factory premises. All the
employees were men with no woman employee on the plant’s payroll. Among the workers and staff it
was common that the management had not initiated the appointment. Since the past 12 years of its
existence, the company was functioning in a traditional pattern in spite of the modernization of the
plant and had no HR practices whatsoever. With the growing competition in the market, the
profitability of the plant had declined which greatly concerned the top management. After reviewing
the situation, it was found that the human element was the biggest hurdle in achieving the set targets.
There was a need to bring in attitudinal change, as both, the absenteeism and the union interference
were high. This union was formed after the workers had felt that the management was exploiting them.
Most of the workers had been there since the inception of the plant and the turnover was almost
negligible. There was a strong union present in the plant, which was affiliated to INTUC. The plant
managers entered into a long term settlement with the union to set the daily wages and the terms and
conditions of work. The long term settlement was renewed every 3 years. The workers were working
in 30-day night shifts in a month. Being a textile unit, it was a process industry wherein hurdle at one
point of the process would stop the whole production. Moreover, if there were delay in the takeover of
the shift, the output of the entire day would be affected. In the matters of indiscipline, the workers
were charge sheeted and dismissed arbitrarily. In chronic cases, the worker had to wear a badge with a
slogan “I will not repeat the mistake again” for the entire day on his uniform.
The company started thinking of corporate governance and hired the services of Narayan Murthy,
AGM (P & A and ER) for the Jabalpur plant in May 2001. Since its establishment, the plant had seen
eight Personnel Managers come and go. Narayan Murthy who was in his late thirties had been working
with a multi-national company and had a wide exposure to the human resource practices. He was given
complete autonomy by the corporate office to transform the existing organizational culture. After
Narayan Murthy took over the charge, he formed the “Workers Committee” with one representative
who would frame the report, discuss with him and help out in counseling the workers. He changed the
traditional designations like the “Khata Adhikari” to the “Shop Floor Manager”. He also made training
and development programs, an integral part of the employee development. His first attempt in this
direction was an ice-breaking workshop called the “Project Energized” which was conducted by
women trainers. To bring women closer to the system, he had taken an initiative to form a ladies’ club
Examination Paper: Customer Relationship Management
4
IIBM Institute of Business Management
for the wives of all the employees, which became an uphill task for him as he was facing a lot of
problems in getting the people together. Narayan Murthy also introduced the concept of multi-skilling
where the worker was persuaded to work in different stages of the process. Although, the worker did
not get a monetary incentive for the same, he developed enrichment of the skills. Many a times the
union resisted to this and then the supervisor had to tackle the situation diplomatically. Another
measure, which Murthy adopted, was to develop an incentive plan for the workers. Any worker who
recorded 26 attendances in a month was given an extra Rs. 10 per day for the month, and so on till 23
attendances per month. Any worker who recorded 26 attendances consecutively for three months was
given an additional benefit of Rs 500. 100 employees responded positively to this scheme. He also
started educating the union and was planning to provide an office and separate notice board for the
union office bearers. He was also planning to reduce the 30 days night shift to 15 days night shift per
month. As per this agenda, he had also planned to employ a lady as the Deputy Manager of Training,
preferably more than 35 years of age who was expected to have completed the social obligations in
terms of her marriage and child rearing. He felt that a woman would be more successful in overcoming
the suspicion among the workers towards the management as he had observed that the workers were
receptive to women summer trainees who had visited the plant for about six weeks last summer. Even
at the Nasik plant, when a lady doctor was appointed as a physician, the workers went in for a strike
objecting the appointment. The workers had afterwards shown a positive response though they had
initially shown a stiff resistance to her appointment. In spite of taking these measures, Murthy felt that
there was too much interference from the union and the employees were not enthusiastic about the
changes. And he wondered what else he should do to transform the culture of the organization.
Questions:
1. In what way would multi-skilling help in solving the problems of the plant?
2. Do you think that the company’s policy of entering into term settlement is appropriate? Give
reasons.
Caselet 2
Mitsubishi Motor Sales: Implementing Customer Relationship Management Systems
Until the late 1990s, Mitsubishi Motor Sales of America Inc. was only about cars and its approach to
retail customer service reflected that. There were more than 18 toll-free customer service numbers that
callers had to navigate to find information on topics ranging from financing to sales to repairs, “We
were fragmented in our approach, and we clearly lacked a customer focus,” says Greg O’Neill,
executive vice president and general manager. Mitsubishi decided to change that. As part of a
company-wide shift to an increased focus on customers, executives challenged the call center to
provide “one voice and one set of ears for the customer,” says CIO Tony Romero. That was the
beginning of a continuing drive toward improved customer service through a customer relationship
management (CRM) initiative that would eventually engage multiple departments and 18 vendors.
Today, Mitsubishi has one call center and an outsourced service provider that handles the most
basic calls. The cost per call has decreased by about two-thirds, and that savings alone paid for the
system in 18 months, according to Rich Donnelson, director of customer relations. The system saves
agents time and uncertainty and enabled the call center to handle 38 percent more volume, with an
even staffing level. Meanwhile, the company’s customer satisfaction rate rose by 8 percent, according
to a survey by J.D. Power and Associates. Mitsubishi call center project team included members from
its sales, marketing, finance, and IT departments, all of which contributed resources as needed. Early
on, the team members established some rules of the road. First, they would selectively choose best-of
Examination Paper: Customer Relationship Management
5
IIBM Institute of Business Management
breed CRM software components, not the integrated CRM suits that seemed intent on force-fitting
Mitsubishi’s needs into fixed product offerings. But that required a constant struggle to keep 18
vendors heading in the same direction. The team members also decided to implement changes slowly,
adding a technology only when all employees were using the last one implemented. This approach
allowed call center agents to get comfortable with the new technology over time. To accommodate the
deliberate, modular approach, all products had to pass the “three S” test: Is it simple? Does it satisfy?
Is it scalable? “If we couldn’t answer yes to all three, we didn’t do it,” says Greg Stahl, Mitsubishi’s
director of advertising. The journey began in earnest in June 1999, when Mitsubishi chose to outsource
its most basic level of customer calls to Baltimore-based Sitel Corp. within two months, Mitsubishi’s
18 toll-free customer numbers and the multiple call centers behind them were consolidated, and call
center software from Siebel Systems was implemented. Also, as part of the companywide customer
focus, a new customer-centric data-base was consolidated in-house the next year. The database became
the engine powering the call center, but unfortunately, dirty data were a major stumbling block. The
project stalled for months as the data were cleansed and updated.
In early 2001, a digital phone switch from Avaya Inc. was installed that allowed flexible skillsbased
call routing. Callers to the single toll-free number routed on menu choices. About half the callers
got the information they needed from an interactive voice response unit, which can answer fairly
sophisticated queries without live contact. Simple calls went to Sitel, and the rest were routed to call
center agents with appropriate skills. In March 2001, graphical user interface upgrades put 11 screens’
worth of customer information on one screen of call center agents. And Smart Scripts workflow
software from Siebel provided agents with decision-tree scripts and automated customer
correspondence. In May 2001, Mitsubishi managers began listening to outsourced service calls, and
they could see agents’ screens with Avaya IP Agent software. The next month, the company started
using workforce management software from Blue Pumpkin Software to hourly forecast call center
coverage. Then nice log software from Nice Systems was installed to record agents’ voice and screen
activity for quality assurance and training.
Aside from happier customers, the benefits to call center employees include career growth and
higher pay. Previously, agents in separate call centers handled specific areas: accounts, vehicles, titles,
or retailer queries. Now the silos are gone and agents can learn new skills in multiple areas, greatly
increasing call center flexibility. The workforce management software schedules training time during
lags, and agents who learn multiple skills earn more money. Call center turnover, which has
traditionally been more than 20 percent, was about 7 percent last year. O’Neill says the executive team
members regularly listen in on service calls to get a feel for customer concerns, and they act on what
they hear. “That bubble up of information has driven more early marketing decisions and made us
more effective earlier on than I could have ever thought,” O’Neill says. “That’s been a huge dividend.”
Questions:
1. What are the key application components of Mitsubishi’s CRM system? What is the business
purpose of each of them?
2. Do you approve of Mitsubishi’s approach to acquiring and installing its CRM system? Why or
why not?
END OF SECTION B
Examination Paper: Customer Relationship Management
6
IIBM Institute of Business Management
Section C: Applied Theory (30 marks)
•This section consists of Applied Theory Questions.
•Answer all the questions.
•Each question carries 15 marks.
•Detailed information should form the part of your answer (Word limit 200 to 250 words).
1. If all the numbers are large, the project way is too big. Can you identify a logical chunk of the
problem that would make a setup toward improving the situation? What kind of “offer” would
you want to make to your customers as a result of completing the small chunk?
2. Who can you get for the program core team? These must be individuals who are good enough at
their real jobs that the company can’t afford to have them take on anything new. The real test of
serious organizational commitment is that the company can’t afford to put anyone else on the
core team; it has to be the best.
END OF SECTION C
1
IIBM Institute of Business Management
IIBM Institute of Business Management
Examination Paper MM.100
Customer Relationship Management
Section A: Objective Type (30 marks)
•This section consists of Multiple Choice questions & Short notes type questions.
•Answer all the questions.
•Part One questions carry 1 mark each & Part Two questions carry 4 marks each.
Part One:
Multiple Choices:
1. High congruence means:
a. High probability of success
b. Low probability of success
c. Zero probability of success
d. None of the above
2. Novo Jim’s excellent resource book for Recency, Frequency and Monetary is:
a. Drilling high
b. Digging the top
c. Cutting edges
d. Drilling down
3. What stands for ‘R’ in FURPS?
a. Responsibility
b. Resource
c. Retention
d. Reliability
4. NAICS stands for:
a. National American Industry Coding System
b. North American Industry Cooling System
c. National American Industry Cooling System
d. North American Industry Coding System
5. The book ‘Reengineering the corporation’ was written by:
a. Michael Hammer and James Champy
b. Michael Champy and James Hammer
c. Michael Douglus and James Ferrari
d. Michael Ferrari and James Douglus
6. The book ‘Building the Data warehouse’ was written by:
a. Michael Doglus
b. James Champy
c. Bill Inmon
Examination Paper: Customer Relationship Management
2
IIBM Institute of Business Management
d. James Ferrari
7. Which is considered as the bible of database marketing?
a. ‘Drilling High’
b. ‘Building the Data warehouse’
c. ‘The complete database marketer’
d. ‘Drilling down’
8. CASE stands for:
a. Customer Aided Software Engineering
b. Computer Aided Software Engineering
c. Customer Aided System Engineering
d. Computer Aided System Engineering
9. What stands for ‘B’ in BBB?
a. Bail
b. Buffer
c. Bureau
d. Block
10. If high quality is one of the attribute then:
a. It will be suicidal to ship products with high DOA
b. It will be beneficial to ship products with high DOA
c. It will be suicidal to ship products with low DOA
d. It will be beneficial to ship products with low DOA
Part Two:
1. Why e- CRM is important in present life?
2. Describe the 3 phases of ‘Waterfall Model’.
3. Write the significance of ‘N/13 Test’ prioritization.
4. What is ‘Life time value’ related with customer?
5. What are ‘Warehouse data(s)’?
END OF SECTION A
Examination Paper: Customer Relationship Management
3
IIBM Institute of Business Management
Section B: Caselets (40 marks)
•This section consists of Caselets.
•Answer all the questions.
•Each Caselet carries 20 marks.
•Detailed information should form the part of your answer (Word limit 150 to 200 words).
Caselet 1
Project Energized:
Indian Synthetics Limited was established in the year 1987 by Seth Gopichand, who was an NRI based
in Singapore. The company’s main products were blended synthetics, polyester and cotton yarn; which
were suitable for readymade garments. The company had achieved an outstanding success with an
annual turnover of Rs. 1,500 crores and was awarded the ‘Exporter of the Year Award’ since 1988, for
four consecutive years by the Government of India. Encouraged by the profitability of the Jabalpur
plant, the company set up another manufacturing plant at Nasik. The company was a typically family
run business wherein no outsiders were inducted at the top management positions. Even the Chartered
Accountant was from the family. The plant at Jabalpur had 1,300 workers with an average age of 28
years and an educational qualification of either high school or secondary school. 60 percent of the
workers were from Bihar and the rest were from Orissa. They were highly paid with reference to the
industry average and were provided with residential accommodation on the factory premises. All the
employees were men with no woman employee on the plant’s payroll. Among the workers and staff it
was common that the management had not initiated the appointment. Since the past 12 years of its
existence, the company was functioning in a traditional pattern in spite of the modernization of the
plant and had no HR practices whatsoever. With the growing competition in the market, the
profitability of the plant had declined which greatly concerned the top management. After reviewing
the situation, it was found that the human element was the biggest hurdle in achieving the set targets.
There was a need to bring in attitudinal change, as both, the absenteeism and the union interference
were high. This union was formed after the workers had felt that the management was exploiting them.
Most of the workers had been there since the inception of the plant and the turnover was almost
negligible. There was a strong union present in the plant, which was affiliated to INTUC. The plant
managers entered into a long term settlement with the union to set the daily wages and the terms and
conditions of work. The long term settlement was renewed every 3 years. The workers were working
in 30-day night shifts in a month. Being a textile unit, it was a process industry wherein hurdle at one
point of the process would stop the whole production. Moreover, if there were delay in the takeover of
the shift, the output of the entire day would be affected. In the matters of indiscipline, the workers
were charge sheeted and dismissed arbitrarily. In chronic cases, the worker had to wear a badge with a
slogan “I will not repeat the mistake again” for the entire day on his uniform.
The company started thinking of corporate governance and hired the services of Narayan Murthy,
AGM (P & A and ER) for the Jabalpur plant in May 2001. Since its establishment, the plant had seen
eight Personnel Managers come and go. Narayan Murthy who was in his late thirties had been working
with a multi-national company and had a wide exposure to the human resource practices. He was given
complete autonomy by the corporate office to transform the existing organizational culture. After
Narayan Murthy took over the charge, he formed the “Workers Committee” with one representative
who would frame the report, discuss with him and help out in counseling the workers. He changed the
traditional designations like the “Khata Adhikari” to the “Shop Floor Manager”. He also made training
and development programs, an integral part of the employee development. His first attempt in this
direction was an ice-breaking workshop called the “Project Energized” which was conducted by
women trainers. To bring women closer to the system, he had taken an initiative to form a ladies’ club
Examination Paper: Customer Relationship Management
4
IIBM Institute of Business Management
for the wives of all the employees, which became an uphill task for him as he was facing a lot of
problems in getting the people together. Narayan Murthy also introduced the concept of multi-skilling
where the worker was persuaded to work in different stages of the process. Although, the worker did
not get a monetary incentive for the same, he developed enrichment of the skills. Many a times the
union resisted to this and then the supervisor had to tackle the situation diplomatically. Another
measure, which Murthy adopted, was to develop an incentive plan for the workers. Any worker who
recorded 26 attendances in a month was given an extra Rs. 10 per day for the month, and so on till 23
attendances per month. Any worker who recorded 26 attendances consecutively for three months was
given an additional benefit of Rs 500. 100 employees responded positively to this scheme. He also
started educating the union and was planning to provide an office and separate notice board for the
union office bearers. He was also planning to reduce the 30 days night shift to 15 days night shift per
month. As per this agenda, he had also planned to employ a lady as the Deputy Manager of Training,
preferably more than 35 years of age who was expected to have completed the social obligations in
terms of her marriage and child rearing. He felt that a woman would be more successful in overcoming
the suspicion among the workers towards the management as he had observed that the workers were
receptive to women summer trainees who had visited the plant for about six weeks last summer. Even
at the Nasik plant, when a lady doctor was appointed as a physician, the workers went in for a strike
objecting the appointment. The workers had afterwards shown a positive response though they had
initially shown a stiff resistance to her appointment. In spite of taking these measures, Murthy felt that
there was too much interference from the union and the employees were not enthusiastic about the
changes. And he wondered what else he should do to transform the culture of the organization.
Questions:
1. In what way would multi-skilling help in solving the problems of the plant?
2. Do you think that the company’s policy of entering into term settlement is appropriate? Give
reasons.
Caselet 2
Mitsubishi Motor Sales: Implementing Customer Relationship Management Systems
Until the late 1990s, Mitsubishi Motor Sales of America Inc. was only about cars and its approach to
retail customer service reflected that. There were more than 18 toll-free customer service numbers that
callers had to navigate to find information on topics ranging from financing to sales to repairs, “We
were fragmented in our approach, and we clearly lacked a customer focus,” says Greg O’Neill,
executive vice president and general manager. Mitsubishi decided to change that. As part of a
company-wide shift to an increased focus on customers, executives challenged the call center to
provide “one voice and one set of ears for the customer,” says CIO Tony Romero. That was the
beginning of a continuing drive toward improved customer service through a customer relationship
management (CRM) initiative that would eventually engage multiple departments and 18 vendors.
Today, Mitsubishi has one call center and an outsourced service provider that handles the most
basic calls. The cost per call has decreased by about two-thirds, and that savings alone paid for the
system in 18 months, according to Rich Donnelson, director of customer relations. The system saves
agents time and uncertainty and enabled the call center to handle 38 percent more volume, with an
even staffing level. Meanwhile, the company’s customer satisfaction rate rose by 8 percent, according
to a survey by J.D. Power and Associates. Mitsubishi call center project team included members from
its sales, marketing, finance, and IT departments, all of which contributed resources as needed. Early
on, the team members established some rules of the road. First, they would selectively choose best-of
Examination Paper: Customer Relationship Management
5
IIBM Institute of Business Management
breed CRM software components, not the integrated CRM suits that seemed intent on force-fitting
Mitsubishi’s needs into fixed product offerings. But that required a constant struggle to keep 18
vendors heading in the same direction. The team members also decided to implement changes slowly,
adding a technology only when all employees were using the last one implemented. This approach
allowed call center agents to get comfortable with the new technology over time. To accommodate the
deliberate, modular approach, all products had to pass the “three S” test: Is it simple? Does it satisfy?
Is it scalable? “If we couldn’t answer yes to all three, we didn’t do it,” says Greg Stahl, Mitsubishi’s
director of advertising. The journey began in earnest in June 1999, when Mitsubishi chose to outsource
its most basic level of customer calls to Baltimore-based Sitel Corp. within two months, Mitsubishi’s
18 toll-free customer numbers and the multiple call centers behind them were consolidated, and call
center software from Siebel Systems was implemented. Also, as part of the companywide customer
focus, a new customer-centric data-base was consolidated in-house the next year. The database became
the engine powering the call center, but unfortunately, dirty data were a major stumbling block. The
project stalled for months as the data were cleansed and updated.
In early 2001, a digital phone switch from Avaya Inc. was installed that allowed flexible skillsbased
call routing. Callers to the single toll-free number routed on menu choices. About half the callers
got the information they needed from an interactive voice response unit, which can answer fairly
sophisticated queries without live contact. Simple calls went to Sitel, and the rest were routed to call
center agents with appropriate skills. In March 2001, graphical user interface upgrades put 11 screens’
worth of customer information on one screen of call center agents. And Smart Scripts workflow
software from Siebel provided agents with decision-tree scripts and automated customer
correspondence. In May 2001, Mitsubishi managers began listening to outsourced service calls, and
they could see agents’ screens with Avaya IP Agent software. The next month, the company started
using workforce management software from Blue Pumpkin Software to hourly forecast call center
coverage. Then nice log software from Nice Systems was installed to record agents’ voice and screen
activity for quality assurance and training.
Aside from happier customers, the benefits to call center employees include career growth and
higher pay. Previously, agents in separate call centers handled specific areas: accounts, vehicles, titles,
or retailer queries. Now the silos are gone and agents can learn new skills in multiple areas, greatly
increasing call center flexibility. The workforce management software schedules training time during
lags, and agents who learn multiple skills earn more money. Call center turnover, which has
traditionally been more than 20 percent, was about 7 percent last year. O’Neill says the executive team
members regularly listen in on service calls to get a feel for customer concerns, and they act on what
they hear. “That bubble up of information has driven more early marketing decisions and made us
more effective earlier on than I could have ever thought,” O’Neill says. “That’s been a huge dividend.”
Questions:
1. What are the key application components of Mitsubishi’s CRM system? What is the business
purpose of each of them?
2. Do you approve of Mitsubishi’s approach to acquiring and installing its CRM system? Why or
why not?
END OF SECTION B
Examination Paper: Customer Relationship Management
6
IIBM Institute of Business Management
Section C: Applied Theory (30 marks)
•This section consists of Applied Theory Questions.
•Answer all the questions.
•Each question carries 15 marks.
•Detailed information should form the part of your answer (Word limit 200 to 250 words).
1. If all the numbers are large, the project way is too big. Can you identify a logical chunk of the
problem that would make a setup toward improving the situation? What kind of “offer” would
you want to make to your customers as a result of completing the small chunk?
2. Who can you get for the program core team? These must be individuals who are good enough at
their real jobs that the company can’t afford to have them take on anything new. The real test of
serious organizational commitment is that the company can’t afford to put anyone else on the
core team; it has to be the best.
END OF SECTION C
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