Customer Relationship Management & Supply Chain Management

What is CRM?

  • CRM stands for Customer Relationship Management.
  • CRM is combination of a variety of strategies used for managing the companies relationships and interactions with potential customers.
  • It helps you improve profitability.
  • It is the strongest and the most efficient approach in maintaining and creating relationships with customers.
  • CRM helps in understanding the customer's needs and behaviors.
  • It defines appropriate actions for retaining customers such as special incentive programs.
  • It involves a process of continuously gathering data at all customer points and then turning that data into knowledge for building more profitable customer relationships.

Features of CRM

  • CRM fulfills customer needs effectively and maintains a long-term deal.
  • CRM is customized by an organization to manage and administrate its customers and vendors in an efficient manner to achieve excellence.
  • It considers customer satisfaction.
  • It focuses on customer loyalty, retention and complaints.
  • It delivers better information and services regarding all the products and brands to the customer.

Importance of CRM

  • CRM foresees customer needs effectively and increases business.
  • CRM includes a historical view and analysis of all the acquired customers.
  • It contains each and every bit of customer details making it easy to track customers and determine the most profitable ones.
  • It is very cost effective.
  • It reduces the process time and increases the productivity.

Misunderstandings about CRM

Following are the misunderstandings about CRM
  • CRM is very expensive and not affordable by small enterprises.
  • This is a complicated system.
  • It is difficult to understand.
  • It makes wrong assessment for the return on investment.
  • Customer Relationship Management can not be identified with a software system.
  • CRM is cost effective and provides affordable price.
  • CRM is not difficult to understand. It is easy to fetch customers' details and maximize the profitability owing to fast developing technology.
  • CRM is a strategy which consists of people and business process. It is not an IT issue only to be simply equated to software.


  • SCM stands for Supply Chain Management.
  • It is also called the art of management of providing the right product, at the right time, at the right place and at the right cost to the customer.
  • SCM strategy is important for an organization. These strategies are the critical backbone to Business Organizations today.

Definition of Supply Chain Management

Supply Chain Management (SCM) is the management of a network of all business  processes and activities involving procurement of raw materials, manufacturing and distribution management of finished goods.

  • This process is an inspection of materials, information and finances as they move in a process from supplier to manufacturer to wholesaler to retailer to consumer.
  • It is the management flow of goods and services.
  • It involves coordinating and integrating flows among companies.
  • SCM reduces the cost and improves the time-to-market of products.
These SCM flows can be divided into three categories
1. Product Flow
2. Information Flow
3. Finances Flow

1. In Product Flow, it includes the movement of goods from supplier to customer.
2. In Information Flow, it involves transmitting orders and updating the status of delivery.
3. In Financial Flow, it involves credit terms, payment schedules and consignment.

SCM can be classified into two types
1. Planning Application
2. Execution Application

1. Planning Application determines the best way to fill an order using advanced algorithms.
2. Execution Application tracks the physical status of goods, materials and involves financial information.