A model of market-orientation effects of customer relationship management on organizational processes

Abstract

This study constructes a model of CRM (Customer Relationship Management) effects on work practice, value-creation processes, and organizational performance. Through iterative literature review and content analysis, this study builds a preliminary understanding of the possible effects and consequences of CRM use on the overall organizational behaviors and processes. The study then conducts case studies on five credit card companies in Taiwan to gain in-depth knowledge of the chain effects of CRM use. Based on the case studies, five propositions are formed: (a) the greater the use of CRM systems, the greater the market-oriented behaviour; (b) the greater the market-oriented behavior, the greater the impact on value-creation processes; (c) the greater the behavioral changes in value-creation processes, the higher the market performance; (d) the greater the market-oriented behavior, the higher the market performance; and (e) the effect of top management initiatives is greater on market-oriented behaviors in the cases of a greater use of CRM than in the cases of a lower use. This research finding provides a base for enhanced understanding of the potential of CRM in different organizational processes and performances. It is hoped that managers of CRM can benefit from the insights presented and implement more effective management of CRM use.