Electronic Customer Relationship Management

Jerry Fjermestad, Nicholas C Robertson Jr

• Publisher: Routledge
• Year: 2015
• ISBN:
  9781317472186
• Edition: 1
• Topic: Business
• Subtopic: Business General
• Index: Business

This work offers a state-of-the art survey of information systems research on electronic customer relationship management (eCRM). It provides important new frameworks derived from current cases and applications in this emerging field. Each chapter takes a collaborative approach to eCRM that goes beyond the analytical and operational perspectives most often taken by researchers in the field. Chapters also stress integration with other enterprise information systems. The book is organized in four parts: Part I presents an overview of the role of CRM and eCRM in marketing and supply chain management; Part II focuses on the organizational success factors behind eCRM implementation; Part III presents cases of eCRM performance enhancement; and Part IV addresses eCRM issues in business-to-consumer commerce.

CHAPTER 1

ELECTRONIC CUSTOMER RELATIONSHIP MANAGEMENT

An Introduction

NICHOLAS C. ROMANO, JR. AND JERRY FJERMESTAD

Abstract: This volume of Advances in Management Information Systems (AMIS) underscores the growing importance of customer relationship management (CRM) in information systems (IS) practice and research, as evidenced over the past decade in conferences, journals, and practitioner publications. This introduction does more than just outline the chapters included in the volume; it surveys the state of research on CRM. Thus, we revisit and extend the series of articles the editors authored on CRM as a subfield of the IS discipline to explore whether or not it has matured or languished with the passage of time. We present evidence of continued growth of IS research into CRM up to this point, and then we introduce the chapters within this volume that illustrate the advances made and the issues and challenges that remain in the subfield for further study. We believe that this volume of AMIS sets the stage for continued research for some time to come.

Keywords: Customer Relationship Management; Information Systems Research; Electronic Customer Relationship Management

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 revitalize 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, development 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, development 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 marketing 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 understand, 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 knowledge 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 oriented 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 meaningful 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 empirically tested. Madeja and Schoder (2003) investigated how eight concepts derived from the media 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 acceptance model (TAM) (Davis 1989) and innovation diffusion theory (Rogers 2003) to provide important 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 illustrate 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 develop 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 organizational 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.

Hypothesis Testing

A second indicator that the IS-CRM subfield is maturing would be the emergence in the literature of hypothesis testing to develop support for IS-CRM theory. Specifically we made this recommendation:

Second, once theories have been developed, there is a need for lab and field experiments to test hypotheses in order to find support for them and rule out other possible explanations. (Romano and Fjermestad 2001–2002, p. 85)

A quick scan of the current IS-CRM literature reveals that hypothesis testing is more often incorporated in studies now than during the period covered in our study. Madeja and Schoder (2003) also tested their research hypotheses on 224 companies that target consumers (B2C) and found that information- and functionality-richness (interactive character) and continuous updating of the Web site are key drivers of success for general companies. Chen et al. (2004) also tested four major hypotheses based on their proposed theoretical model and found that the model sub-stantially explained and predicted consumer acceptance of virtual stores and also explained many of the factors that lead to the user’s intention to use, and actual use of, a virtual store. Madeja and Schoder (2004) constructed a covariance structure (LISREL) model and tested three research hypotheses with a data set of 469 cases of general companies in the German-speaking market. They found that CRM is a critical success factor in electronic commerce, independent of how long the company has been on the Web, and that CRM is especially critical for B2C and small companies. These are three among many papers emerging in the literature that illustrate an increased use of hypothesis testing—providing evidence of the maturation of IS-CRM over time.

Instrument Validation

In our study only a very small percentage of the survey articles discussed instrument validation, and not all of these discussed reliability testing or validity in detail. We made the following recommendation:

Third, there is a strong need for researchers to validate the instruments they employ and to explain these procedures in their articles in order to evoke confidence that the results are meaningful, interpretable, and reliable. Instrument development and validation must be carefully undertaken prior to use. Researchers in this new subfield need to explore referent disciplines, such as psychology, and use methods that validate instruments from a number of perspectives, including convergent validity, discriminate validity, construct validity, and reliability. (Romano and Fjermestad 2001–2002, p. 85)

In the current IS-CRM literature we were able to easily find articles that discuss instrument validation in greater detail than we found in our earlier study. Susarla et al. (2003) provide a detailed analysis of both discriminant and convergent validity as well as the reliability of the instrument they developed for their study. Croteau and Li (2003) also discuss both discriminant and convergent validity, and they used structural equation modeling (SEM) with partial least squares (PLS) to assess their model. Stefanou, Sarmaniotis, and Stafyla (2003) relied on previ...

Table of contents

• Cover Page
• Half Title page
• Serie Page
• Title Page
• Copyright Page
• Contents
• Series Editor's Introduction
• Acknowledgments
• Original Half Title page
• Chapter 1 Electronic Customer Relationship Management An Introduction
• Part I The Role of CRM and ECRM
• Part II Organizational Success Factors of CRM
• Part III Enhancing Performance of CRM
• Part IV CRM in Business-to-Customer Commerce
• Editors and Contributors
• Series Editor
• Index