Evaluate how an organisation implemented an information system (such Essay

Evaluate how an organisation implemented an information system (such as a CRM, SCM or ERP - Essay Example In the modern world with increased expectations from customers, relationship marketing has become an important factor in financial services. Therefore, the management function of banks needs to critically analyse those areas where prospects can be found owing to industry amalgamation, virtual distribution and the growing ability to transfer cash just with the snap of a mouse which has made it efficient for customers to shift their loyalty from one bank to the other. It is this necessity that has prompted many banks to establish a relationship with their customers by coming up with a well-managed system that ensures that banks fully understand their customers, retain existing clients through enhancedconsumer experience, remain attractive to new customers and gain new clienteles and contracts, increase cost-effectiveness and cut back on consumer organization costs. In this scenario, CRM (Customer Relationship Management) is an information system that presents an opportunity for banks t o develop concrete relationships with their clients who can then market their services through word of mouth, making it hard to change loyalty by switching to other banks among others (Hwang and Wen,2009; Kamakura et al., 2005). HDFC Bank, India, launched the use of CRM in 2008 to achieve its vision of â€Å"One Bank† to enable it make available to the customers more information about the bank and attract new customers in order to boost its profitability and customer satisfaction. HDFC Company Profile and Porters Five Forces Analysis HDFC is a commercial bank based in India and is the largest private universal bank by market capitalization having a customer base totalling over 25 million, an elaborate distribution network consisting of 2,544 branches spreading across 1399 cities around the world. The bank also has a huge workforce with over fifty five thousand employees. For HDFC Bank to effectively apply its core competencies to achieve a profit above the industry average, i t is important to assess its potential for profitability and strategic position in the Indian banking industry. The Indian banking sector is defined by a high bargaining power of customers owing to the fact that banks provide uniform services. This is mainly due to the fact that nearly all banks strive to make available requisite information to their clients through such facilities as internet and mobile banking thus increasing buyer information availability and buyer price sensitivity. On the other hand, The Reserve Bank of India, the nation’s central bank and regulatory body, has created numerous regulatory standards and benchmarks which have to be met by banks. This in effect lowers the bargaining power of commercial banks in general and HDFC in particular. The industry is also highly competitive given the numerous numbers of public, private, foreign and cooperative banks offering financial services similar to those offered by HDFC. The availability of substitutes outside of the realm of common product boundaries of HDFC such as mutual funds, Government securities and T-bills increases the propensity of customers to switch to alternatives. Lastly, HDFC faces a low level of threat of new entrants to the industry due to the high number of banking regulations created by the Reserve Bank of India (Goyal and Joshi, 2012). CRM Customer Relationship