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Submitted in Partial Fulfillment for The
Award of Degree of
Masters of Business Administration

I hereby declare that this Project Report titled A STUDY ON

STATE BANK OF INDIA Submitted by me is a bonafide work undertaken by me
and it is not submitted to any other University or Institution for the award of any
degree, diploma & certificate or published any time before.












STATE BANK OF INDIAIs a record bonafide work carried out by under my
supervision towards partial fulfillment for the award of the MASTERS

Place: Udaipur

I would like to give special acknowledgement., Founder of IICE College,

Udaipur for his blessings and inspiration.
I am grateful to .., Director & Professor of.College, .for her technical
expertise, advice and excellent guidance. She not only gave my project a scrupulous
critical reading, but added many examples and ideas to improve it.
I am indebted to my other faculty & staff members who gave time and again
reviewed portions of this project and provide many valuable comments.
I would like to express my appreciation towards my friends for their encouragement
and support throughout this project.

Table of Contents







Aims of CRM


Concepts of CRM


Scopes of CRM


CRM in Banking Sector


Objectives of CRM


Research Methodology


Review of Literature



Need of the Study



Analysis & Findings






Limitations & Suggestions








Customers are the focal point in the development of successful marketing strategy.
Marketingstrategies both influence and are influenced by consumers affect and

cognition, behavior andenvironment. In the banking field a unique Relationship

exists between the customers and thebank. But because of various reasons and
apprehensions like financial burdens, risk of failure,marketing inertia etc., many
banks are still following the traditional ways of marketing and onlyfew banks are
making attempts to adapt CRM. It is with this background, the researcher hasmade
a modest attempt towards the idea that CRM can be adapted uniformly in the
bankingindustry for betterment of Banking Services. The lack of understanding on
Relationship Management (CRM) is always a concern among the service providers
especiallybanks. Banks have their own way of managing their relationships with the
customers. However,the perception of customers on CRM practices among banks
should also be taken intoconsideration. Here in this paper, effort is given to study
the comparative perception of SBIcustomers and other nationalized banks
customers in the issue of CRM practices. It is observedthat the approach of CRM
by SBI and other nationalized are to some extent same and one but thereach is quiet
distinguishable. It is due to the profile, their capability and the strategy of CRM
inmaking it and reaching down to customers. On the contrary, it can also be asserted
that thebackground of both banks also found as a big cause for reaching the top
CRM. Hence, CRM isan inevitable tool of marketing that can be considered as
Critical Responsibility of Market withregard to Banks in present context.

The banking industry in India has undergone radical changes due to the
liberalization andglobalization measures undertaken since 1991.Today, Indian
banking industry is one of thelargest in the world. State Bank of India is the largest
public sector bank in India. There has beena great surge in efficient customer
service. A highly satisfied and delighted customer is a vitalnon-financial asset for
the banks in the emerging IT era. Customer Relationship Management(CRM)
provides interactive, personalized and relevant communication with customers
todevelop and maintain relationships.CRM is a tool to retain the 20% customers
who give 80% ofthe revenue. This paper explores the perception of Customer
Relationship Management withrespect to the Customers of State Bank of India in
Karimnagar district of Andhra Pradesh. Thestudy is based on the responses of 200
customers of State Bank of India branches in Karimnagardistrict.


Customer relationship management is one of the strategies to manage customer as it

focuses onunderstanding customers as individuals instead of as part of a group
(Lambert, 2010). Managingcustomer relationships is important and valuable to the
business. The effective relationshipbetween customers and banks depends on the
understanding of the different needs of customersat different stages. The ability of
banks to respond towards the customers needs make thecustomers feel like a
valuable individual rather than just part of a large number of customers.
CRM manages the relationships between a firm and its customers. Managing
customerrelationships requires managing customer knowledge. CRM and
knowledge management arePinnacle Research Journals 69directed towards
improving and continuously delivering good services to customers. Tounderstand
more in customer relationship management, we first need to understand
threecomponents which are customer, relationship and their management (Peppers
and Rogers, 2004).More often, managers always make mistakes by seeing
customers satisfaction from their eye notfrom customers eye (Peppers and Rogers,
2004). Banking sector is a customer-oriented servicewhere the customer is the KEY
focus. Research is needed in such sector to understandcustomers need and attitude
so as to build a long relationship with them. Customer RelationshipManagement
includes all the marketing activities, which are designed to establish,
develop,maintain, and sustain a successful relationship with the target customers.
CRM identifies thepresent and future markets, selects the markets to serve and
identifies the progress of existingand new services.Thus, CRM is a managerial

philosophy that seeks to build long term relationships withcustomers. CRM can be
defined as the development and maintenance of mutually beneficiallong-term
relationships with strategically significant customers (Buttle, 2002). It is
theestablishment, development, maintenance and optimization of long term
mutually valuablerelationships between consumers and the organisations.
Successful customer relationshipmanagement focuses on understanding the needs
and desires of the customers and is achieved byplacing these needs at the heart of
the business by integrating them with the organisationsstrategy, people, technology
and business processes.
Customer Relationship Management has emerged as a popular business strategy in
todayscompetitive environment. It is a discipline which enables the companies to







Management has been in India for over two decades but itspenetration into the
industry in general and financial service sector in particular has not beenvery
impressive. With the entry of many foreign banks and setting up of many private
sectorbanks, there is an increased competition in the banking sector to attain a
competitive advantage.Banks have slowly but surely realized the importance of
building and maintaining customerrelationships.
CRM is a holistic strategy which can help the banks to become customer oriented
and implement customer- focused strategies, which in turn will help them build
long lasting relationships with the customers and hence increase their profits.

Aims of CRM


The CRM is a new technique in marketing where the marketer tries to develop long
term relationship with the customers to develop them as life time customers. CRM
aims to make the customer climb up the ladder of loyalty.
The company first tries to determine who are likely prospects i.e. the people who
have a strong potential interest in the product and ability to pay for it. The company
hopes to convert many of its qualified prospect into first time customers and then to
convert those first time customers into repeat customers. Then the company tries to
convert these repeat customers into clients they are those people who buy only
from the company in the relevant product categories. The next challenge for the
company is to convert this client into advocates. Advocates are those clients who
praise the company and encourage others to buy from it.
The ultimate challenge is to convert these advocates into partners where the
customers and the clients work actively together to discover ways of getting mutual
Thus in CRM the key performance figure is not just current market share but share
of life time value by converting customers into partners.
In CRM the company tries to identify that small percentage (20%) of key account
holders whose contribution to the company revenues is high (80%). So from this
point of view, CRM is also known as KEY ACCOUNT MANAGEMENT.


Customer Relationship Management is a strategic orientation that identifies the
mostimportant long-term customers and develops and understanding of how these
customers can beretained.CRM can be defined as the strategies, processes, people
and technologies used bycompanies to successfully attract and retain customers for
maximum corporate growth andprofit.
Parvatiyar and Sheth (2000) defined CRM as a comprehensive strategy and
process of acquiringand partnering with selective customers to create superior value
for the company and thecustomer.


Scope of the study

As we know that customers is regarded as the king customers are the lifelines of the
business.no business can be done without them. But in the competitive market you
can get the customer but the more difficult is to retain the customers and this can be
done if we satisfy customers from head to toe. If we will not satisfy the customers
then they will leave our organization and join other, today if the organization has
the largest customer then it may be possible it cannot provide the best services to all
these customers.
So I am working on the project of the effectiveness of customer
relationship management in S B I bank. The main objective of the project is to
determine how this bank has the largest customer base and how it is providing the
best services to customers .how it is providing the services individual to each
customer irrespective of whole customer .in last to find that the customer is satisfy
from these various products and services of bank from their dealings, their facilities
provided, theirbehavior with the customers etc.
As to survive and to make profits, the bank has to strengthen its
customers base and it can be done only through the customers satisfaction and
maintaining long term relation. And for this customers behavior and customers
demand should analyzed and that is what I try to do in this report.


The main scope of the study is


To find out the customer satisfaction level.

To find out why customers have an account in more than one bank.
To find the pitfall in the services of the bank.
To throw light on how banks are meeting the needs of customers separately in
order to maintain long relation.

Why Customer Relationship Management


A satisfied customer in 10 years will bring 100 more customers to the

It costs 7 times more to attract a new customer than to serve an old one.
20% of the companys loyal customers account for 80% of its revenues.
(Paretos principle).
The chances of selling to an existing customer are 1 in 2, the chances of
selling to a new customer are 1 in 16.

Eight ways to keep customers for life


1. Every part of the companys marketing effort should be geared towards building
lifetime relationships.
2. People want to do business with friendly people. To have effective relations a
friendly attitude must permeate in the organization.
3. Information technology developments should be positively used to serve the
4. The company should always be flexible to bend its rules and procedures in the
clients favor.
5. The company should communicate with its customers even when it is not trying
to sell something.
6. The company can communicate and develop stronger customer bonding by
providing financial and social benefits.

7. The company should try to know all its customers including their lifestyles,
hobbies, likes and dislikes etc.

8. The company should make it a point to deliver more than what is promised.



Over the last few decades, technical evolution has highly affected the banking
industry. For more than 200 years, banks were using branch based operations. Since
the 1980s, things have been really changing with the advent of multiple
technologies and applications. Different organizations got affected from this
revolution; the banking industry is one of it (Sherif, 2002).

In this technology revolution, technology based remote access delivery channels

and payment systems surfaced. ATM displaced cashier tellers, telephone
represented by call centers replaced the bank branch, internet replaced the mail,
credit cards and electronic cash replaced traditional cash transactions, and
interactive television will replace face-to-face transactions (Sherif, 2002). In recent
years, banks have moved towards marketing orientation and the adoption of
relationship banking principles. The key motivators for embracing marketing
principles were the competitive pressure that arose from the deregulation of the
financial services market particularly in India. This essentially exposed clearing
banks and the retail banking market to increased competition and led to a blurring
of boundaries in many traditional product markets (Durkin, 2004). The bank would
need a complete view of its customers across the various systems that contain their

data. If the bank could track customer behavior, executives can have a better
understanding, a predicative future behavior and customer preferences. The data
and applications can help the bank to manage its customer relationship to continue
to grow and evolve (Dyche, 2001). According to Stone et al. (2002) most sectors of
the financial services industry are trying to use CRM techniques to achieve a variety
of outcomes. In the area of strategy, they are trying to:

Create consumer-centric culture and organization;

Secure customer relationships;
Maximize customer profitability;
Integrate communications and supplier customer interactions

across channels;
Identify sales prospects and opportunities;
Support cross and up-selling initiatives;
Manage customer value by developing propositions aimed at
different Customer segments;
Support channel management, pricing and migration.

CRM is a sound business strategy to identify the banks most profitable customers
and prospects, and devotes time and attention to expanding account relationship
with those customers through individualized marketing, reprising, discretionary

decision making, and customized service through the various sales channels that the
bank uses. Any financial institution seeking to adopt a customer relationship model
should consider six key business requirements (Chary & Ramesh, 2012), they are:

Create a customer-focused organization and infrastructure.

Gaining accurate picture of customer categories.
Assess the lifetime value of customers.
Maximize the profitability of each customer relationship.
Understand how to attract and keep the best customers.
Maximize rate of return on marketing campaigns.

CRM is developing into a major element of corporate strategy for many

organizations(Rangarajan, 2010; Shibu, 2011). A greater focus on CRM is the only
way the banking industrycan protect its market share and boost growth. With
intensifying competition, declining marketshare, deregulations, smarter and more
demanding customers, there is competition between thebanks to attain a competitive
advantage over one another or for sustaining the survival incompetition.In India, the
banking sector has been operating in a very stable environment from last thirty
-forty years. In current scenario of banking sector, the falling of interest rates and
toughcompetition between these players had made Indian bankers to realize that the
purpose of theirbusiness is to create and retain a customer and to see that the entire

business process is consistentwith an integrated effort to discover, retain and satisfy

customer needs. But the success of' CRMStrategy depends upon its ability to
understand the needs of the customer and to integrate themwith the organisation's
strategy, people, technology and business process. Financial services arein a
structural change whereby competition and customer demands are increasing with
the organisation's strategy, people, and technology and business process. Financial
services arean a structural change whereby competition and customer demands are

The CRM at SBI

The need for system automation became critical at SBI. The challenge was to meet
thedemanding service and fulfillment levels of the growing. SBI was on the lookout
for a technologysolution that was easy to implement, cost-effective and robust to
expand its presence in theinsurance sector and achieve a higher degree of service
differentiation. Although the organizationhad a centralized system, most of the work
was done manually. They had client/serverarchitecture in place. But it was not


integrated with the legacy systems.Early on, the top management realized that
technology was a crucial driver for product andservice delivery. Although using the
extensive SBI group platform for cross-selling products andservices was a viable
option, reaching and engaging the customer cost effectively required atechnology
backbone. Earlier, they had little enterprise software to support its business and
theprocesses were carried out in an ad hoc manner.

Reduction in TAT (Turn Around Time)
SBI can now integrate and manage content, campaigns and
merchandising to patronsvia the Web
Streamlined product delivery and support processes with a single
contact point on theWeb
Site offers a one-stop-shop for customers' needs
There were hiccups as various centers had problems connecting to the CRM portal,
which havebeen solved. They are using multiple types of connectivity, leased lines
that terminate at thecentral data center in Mumbai, broadband connections, dial-up

connections, telephone lines, etc.The type of connectivity depends on the number of

users in that particular branch and the kind ofwork being done there. They have
their mail server and other functionalities on the portal too.The development tool,
WebLogic Workshop, is Java-based, allowing people at SBI to developand
customize applications at a faster pace. Applications running on the system permit
themanagement of content, merchandise and campaign-related details. The
company has evenmoved its internal applications to the portal. Thus, even when a
staff member is workinginternally, he is working with an interface of a
browser/portal. What used to be on a client/serverenvironment is now on the portal.

Banks and Respective CRM

Functions like cash management, proposal details and issuing policies all happen on
the portal.Having deployed WebLogic, SBI is able to run its cycle-all its processes
right from claimsprocessing to CRM-on the portal. Some features of the system are
load balancing, effective codedeployment and clustering support (24x7). Plans are
afoot to use the portal for providing selfserviceto customers, partners and
employees. One can just come in, log on to the portal, andaccess any kind of

information.SBI implemented the system in a different manner. With this initiative,

SBI has derived quite afew benefits. For instance, it has been able to reduce the
Turnaround Time (TAT). Because ofthis initiative they could spot a few processes
that would otherwise never be realized. they haveoutsourced some routine work
which was done centrally and was manual. Now, irrespective ofthe location of the
work, its done through the portal and they are able to manage it better.

Saving time and money

Process improvements are evident. All of this happened with minimal system
changes withoutadding to the existing infrastructure The solution has also brought
down by 50 percent the timetaken for specific processes like cash management.
With a view to understanding the data qualitygaps and to develop a road map to
closing them, SBI engaged Spectrum Business Support Ltd.sData fix Solutions
team (now Datafix Technologies Pvt. Ltd.) to undertake a Data Quality Studyand
Audit (DQ Audit). There were requirements of time and funds to obtain a true
foundation ofcustomer-oriented information, by running a De-duplication pilot on a
significant portion of themigrated Phase I data, numbering 3.3 million records.


Data Quality Consulting and Audit:

Define Data Quality Audit Project Scope identifying DQ dimensions, gaps
and parameters to bestudied.
Data Quality Study including defining Business Rules and Domain Rules for
conducting the DQAudit.
DQ Audit Process and presentation of results including listing of DQ
problems that would likelyhamper SBI's information management and
Customer Relationship Management strategy.

Data De-duplication Pilot


Pre-cleansing 3.3 million records data sourced from the Core Banking application.
755. Banks and Respective CRMDE duplicating the records to arrive at Unique
IDs.Identifying key customer relationship metrics based on unique individual and
household Ids. SBI is equipped to develop a blue-print for their Customer Quality
Initiatives to create long-termcompetitive advantage. State Bank of India (SBI),
Indias largest financial services conglomeratehas contracted to implement Anti
Money Laundering (AML) software AMLOCK from 3i InfoTechLtd .it helps the
bank in managing its government clients better. Cash@WillTM helps SBI improve
Revenue, maximizes profits, optimize costs, and establish efficient management
systems toaccelerate growth.SBI is now using Nucleus Softwares Cash@WillTM
for Drafts, Income TaxRefund Orders (ITRO), and Multi City Cheque (MCC) and
Collections services. The implementationwas done in a phased manner where
Payments and Collections modules implemented initiallywere subsequently
replaced by the newer version of Cash@WillTM. Nucleus' Cash@WillTM will
Power the cash management product of State Bank of India. It supports the bank in
handling ofgovernment business like ITRO, SBI rights issue.. Nucleus Cash
Management SolutionCash@WillTM built on new generation technologies of
Oracle empowers banks to offer theircorporate customers optimized cash

management services, dramatically improving fundscollection and inflow

forecasting, payment dispatch and funds utilization. It provides anytime,anywhere
access to quality real-time consolidated information and seamlessly supports
multibank,multi-currency, multi-lingual transactions, ensuring smooth flow of
information and cash.


A firm in textile industry has to maintain good relations with its customers. They
have to retain the customers for a long time to avail the benefit of their relations.
The customer relationship management is one of the effective tool to identify,
establish and maintain relationship with the customers. With the help of this
research we are going to identify the importance of CRM in textile industry.

Focus of the problem


The textile industry is basically manufacturing based industry. Through this study
we are going to identify the importance of CRM in the textile industry. How it is
benefited from CRM? Is there any relevance of implementing CRM? And what role
does information technology can play in CRM?

Objectives of CRM
The main objective of the study is to examine the importance of CRM in banking
sector, and itsimpact on the Customer Satisfaction with a special reference to State
Bank of India (SBI) andother nationalized bank including UBI, BOB, BOI, UCO,
PNB and Allahabad bank. The otherspecific objectives of the study are:

To review the literature on the concept and use of CRM in banking sector.
To analyze the perception of customer on CRM as a tool of banking sector in
retention of customers in general and SBI and other nationalised banks in
To offer pertinent suggestions based on the findings of the study.

To study the current practices of CRM.

To find out the impact of CRM on the profitability of the organization.
To study the factors affecting the CRM practices.
To study the role of information technology in CRM.

Research Methodology
A research design is simply a plan for study in collecting and analyzing the data. It
helps the researcher to conduct the study in an economical method and relevant to
the problem.
Research methodology is a systematic way to solve a research problem. The
methodology should combine economy with efficiency.

Research design
The study conducted here is exploratory cum descriptive.


Scope of the study

The scope of the study is confined to Company ___________.

Collection of the data

There are two types of data.

Primary data

primary data is that data which is collected for the first time.

These data are basically observed and collected by the researcher for the first time. I
have used primary data for my project work.

Secondary data

secondary data are those data which are primarily collected

by the other person for his own purpose and now we use these for our purpose

Data collection
Data is collected through schedule.

Modern Marketing philosophy advocates the concept of CRM that creates customer
delight. Thisapplies to all sectors of Sales and Marketing includes the banking. In
the banking field a uniqueRelationship exists between the customers and the bank.
But because of various reasons andapprehensions like financial burdens, risk of
failure, marketing inertia etc., many banks are stillfollowing the traditional ways of
marketing and only few banks are making attempts to adaptCRM. It is with this
background, the researcher has made a modest attempt towards the idea thatCRM
can be adapted uniformly in the banking industry for betterment of Banking
Services. Therole of CRM is quite different and distinguishable to traditional type
of Marketing CRMparticipate not only in Marketing but also in implementing the
business as a strategy to acquire,grow and retain profitable customers with a goal of
creating a sustainable competitive advantage.

There are four key steps for putting one to one

marketing program to work
Step 1: Identify your customers
To launch a one to one initiative the company must be able to locate and contact a
fair number of customers or at least a substantial portion of its valuable customers.
It is crucial to know the customer details as much as possible, not just their names
or address, but their habits, preferences and so forth.

Step 2: Differentiating your customers

Customers are different in two principal ways; they represent different levels of
value and have different needs. Once the company identifies its customers

differentiating them will help the company to focus its efforts to gain the most
advantage with the most valuable customers.

Step 3: Interacting with the customer

Interaction is also a crucial component of a successful CRM initiative. It is
important to remember that interaction just not occur through marketing and sales
channels, customer interact in many different ways with many different areas of the
organization so to foster relationship all the areas of the organization must be
accessible to the customer.

Step 4: Customize your enterprises behavior

Ultimately to lock a customer into a relationship a company must adapt some
aspect of its behavior to meet customers individually expressed needs this might

mean mass customizing a manufactured product or it might involve tailoring some

aspect of the service surrounding the product.

Significance of the study

The CRM (customer relationship management) is an integrated effort to strengthen
the network of relationship for the mutual benefit of both the parties. The biggest
management challenge in the new millenium of liberalization and globalization for
a business is to maintain good relationship with the king the customer. This study
is of great significance because:
A 5% increase in the customer retention will increase the profit up to 125%.
It costs seven times more to attract a new customer than to serve an old one.
20% of the companys loyal customers account for the 80% of its revenues.
To study on customer relationship management would enable the researcher to
know about the CRM practices adopted in the textile industry.


Body and Limayem(2004) explored that CRM in terms of partnerships,

empowermentwith customers and personalization, have a positive and direct impact
on customer loyalty.Effective CRM will lead to greater customer loyalty (Evans
&Laskin, 1994). Organization canuse website characteristics to build tight
relationships with their customers who become loyal tothem, rather than to select
customers on a transaction-by- transaction basis from a large pool ofnon-loyal
customers (Reinartz& Kumar, 2002).As pointed out by Bohling(2006), top
managements support is essential for the successof CRM implementation. They
also identified that CRM success was more strongly associatedwith CRM
ownership being at the corporate level.


In this paragraph, sincere effort is given to highlight the concept and significance of
CRMvia a vis the uses and application of CRM in Banking sector. In the literature,
the main difference among the definitions of CRM are technological and
relationship aspects of CRM. The phraseCRM appeared in the literature after the
evolution in the relationship marketing philosophy.Berry (1983) defined
relationship marketing as attracting, maintaining and enhancing thecustomers
relationships in multi-service organization. After a few decades, the evolution in
Relationship marketing philosophy changed the word relationship marketing to
CRM. Accordingto Brown (2000) CRM is a process of acquiring new customers,
retaining the existencecustomers, and at the same time understands, anticipates and
manages the needs of anorganisations current and potential customers.
Furthermore, Mylonakis (2009) described CRMas an innovative process to create a
long term relationship and gaining trust.

CRM in financial service industry is a cyclical process which starts with

definition of customeractions (Panda, 2003). CRM is fundamental to building a
customer-centric organization. CRM isa key element that allows a bank to develop

its customer base and sales capacity. The goal ofCRM is to manage all aspects of
customer interactions in a manner that enables the organizationto maximize
profitability from every customer. Panda (2003) described customer expectations
are difficult to manage but are often the cause of dissonance which results in loss of
existingcustomer base. So understanding of customer expectations with regard to
service delivery levelsand product quality is essential for establishing a long term
symbolic value relationship. Fromthe foregoing, it can be said that the purpose of
CRM is to bring about Customer FocusedServices (Gummesson, 1987; Gronroos,
1990; Varki and Colgate, 2005; Gan et al., 2006),Information and Communication
Technology, Complaints Management (Wilke 1994;Ingram, 1996; Omarley and
Tynan, 2000; Gilly et al., 2005; Achumba, 2006), High QualityService
(Khandwalla, 1995; Eisingerich and Bell, 2006), Timeliness in Service Delivery,
Friendliness of Employees (Reinatz and Kumar, 2003), Ease of Opening Account
andCompetitive Charges in order to enhance organizational performance as
indicated by suchvariables as Customer Satisfaction (Morgan and Hunt, 1994;
Naidu et al., 1999), CustomerRetention (Dick and Basu, 1994; Morgan and Hunt,
1994; Reichheld, 1996), increase in numberof customers (Groonroos, 1990), and
increased net profit (Khandwalla, 1995; Page et al., 2006).

The organizational performance is enhanced because marketing efficiency is

achieved due to thecooperative and collaborative processes (Sheth and Sisodia,
1995) introduced by CRM whichhelps in reducing transaction costs and overall
development costs for the company. These bringsabout two important processes of
proactive customer business development and buildingpartnering relationships with
the most important customers (Chitanya, 2005) and eventuallyleads to superior
mutual value creation between the organization and the customer. Further, aclear
vision of CRM along with appropriate strategies if applies in banking sectors found
out thatbeneficial in maintaining the customer service quality, customer satisfaction
and customerretention which ultimately leads to the growth of the organization and
profitability (Bansal andSharma, 2008). Girdhar (2009) observed that by satisfying
the internal customers and buildinggood relationship with them, the relationship
with the external customers can also be retainedand satisfied by the banks. Kumar
& Rajesh (2009) reveals that any bank that wishes to eitherg
row in size of its banking operation or improve its profitability must consider the
challengesaffecting its customer relationship.The following literature review section
provides a discussion and argument for the servicequality and CRM practices. The

challenge before the banks is not only to obtain updatedinformation for each
customer, but also to use the information to determine the best time to offer
the most relevant products (Lau et al., 2003). It is also important to understand that
if customersbring in profits for the bank, it becomes imperative for the bank to
provide excellent services tothose customers, otherwise they switch to other banks
(Ray, 2007). Service quality in bankingimplies consistently anticipating and
satisfying the needs and expectations of customers.

Parasuraman et al. (1985) also hold the view that high quality service gives
credibility to thefield sales force and advertising, stimulates favorable word-ofmouth communications,enhances customers perception of value, and boosts the
morale and loyalty of employees andcustomers alike. Puccinelli (1999) looks the
financial services industry as entering a new erawhere personal attention is
decreasing because the institutions are using technology to replacehuman contact in
many application areas. Over the last few decades, technical evolution hashighly
affected the banking industry (Sherif, 2002). In todays competitive banking
industry,customers have to make a choice among various service providers by
making a trade-off betweenrelationships and economies, trust and products, or

service and efficiency (Sachdev et al., 2004).Roger Hallowell (1996) conducted a

research on customer satisfaction, loyalty, and profitabilityand found that as
compared to public sector, private sector bank customers level of satisfaction
is comparatively higher. CRM is a key to create a superior customer experience. It
manages thecustomer relationship by creating a clear understanding (Know), by
developing services andproducts based on the added value for target groups
(Target), then enabling the actual sale anddelivery of services and products through
the selected channels (Sell), and developing long termprofitable relationships with
customers after sales services (Service) (Hussain, et.al., 2009).

Many researchers have been done in various industries especially in the banking
sector thatfocusing on customer oriented services (Ndubisi et al., 2007; Rootman et
al., 2008; and Duttaand Dutta, 2009). Lu and Shang (2007) explored the CRM
perceptions in freight forwarderservices from managerial perspectives. They had
come out with six dimensions of CRM namelycustomer acquisition, customer
response, customer knowledge, customer information system,customer value
evaluation, and customer information process.The following literature review
section provides a discussion and argument for the selection ofthe variables for the

empirical investigation on CRM. Almossawi (2001) examined the bankselection

criteria and observed that there are four selection criteria of banks in Bahrain amely
technology, convenience, financial benefits and employees or customer interactions.
Wang et al.(2004) developed an integrative framework for customer value and
CRM performance based onthe identification of the key dimensions of customer
value viz. functional value, social value,emotional value and perceived sacrifices.
Sin et al. (2005) identified four dimensions of CRM intheir study viz. key customer
focus, CRM organization, technology-based CRM and knowledgemanagement
(Parvatiyar and Sheth, 2001). Rootman et al. (2008) investigated the variables that
influence the effectiveness of CRM strategies in banks viz. attitude,
knowledgeability and two-waycommunication related to bank employees.

The literature on CRM suggests that banks should consider the customer
relationship life cycle(Dwyer et al., 1987). In general, there are three core phases:
customer acquisition, customerenhancement, and customer recovery. The
acquisition phase describes the initiation of acustomer-bank relationship. In CRM
initiatives, customer representatives help customers getused to the products and
services, thereby increase customer familiarity. As the service industryhas a high

degree of integration and interaction in terms of contact contribution, empowerment

isa helpful instrument for successful control of individual customer relationships
(Mudie andCottam, 1993). Service recovery is critical as it provides an opportunity
to retain customers. Ifthe customer has been lost but is still attractive, recovery
offers could be made to the customer(e.g. cancellation in the initiation fee; taking
care of formality caused by the switching) or valueadded services could be offered.
In the customer-centered paradigm, customer asset management(CAM), customer
equity (CE), return on quality and service profit chain are similar to CRM(Berger et
al., 2002; Blattberg et al., 2001; Rust et al., 1995; Heskett et al., 1994).



The forces of deregulation, globalization and advancing technology have
greatlyincreased the competitive pressures in all the industries, especially in the
banking industry.Indian banks are functioning increasingly under competitive
pressures emanating from within thebanking system, from non banking institutions
as well as from domestic and international capitalmarkets. Thus in this era of
increased competition, in order to prosper, it will be imperative forthe banks to
develop long term relationships with the customers by offering quality services.
Developing long term relations with the customer depends basically on three
dimensions product quality, service quality and relationship quality for any kind of
industry. This fact isalso applicable for banking industry.Since the perceived service
quality acts as a foundation for developing long-termcustomer relationships, the
present study is mainly undertaken to present the SBI customers
Perception on CRM and to study the perceived service quality provided by the



CRM has emerged as a popular business strategy in todays competitive
environment. Itis a discipline that enables the companies to identify and target their
most profitable customers. Itinvolves new and advance marketing strategies that not
only retain the existing customers butalso acquire new customers. It has been found
as a unique technique which can bring remarkablechanges in total output of
companies. Through the literature survey and data analysis it can beinferred that










satisfaction,commitment and loyalty that underlines the significance in Indian

Banking Sector. Customerslargely select their banks based on how convenient the
location of bank was to their homes oroffices. With the advent of new technologies
in the business of banking, such as internet bankingand ATMS, now customers can
freely chose any bank for their transactions. Private Banks havetraditionally viewed
themselves as exceedingly Customer Centric offering what they believe tobe

highly personalized services to the High Net Worth Customers. It is also found that
thestructured approach of CRM can provide various benefits to a bank, namely a
distinctive andconsistent customer experience, clear identification of the
organization, technological andprocess-related capabilities. The banking industry is
much further along than other industries inrecognizing the value of CRM and
implementing decision support systems to support CRM.Though most of the banks
have already focused on tactical point solutions, theyre ready for atransition toward
strategic, enterprise-wide CRM initiatives that cross major business lines.
Aneffective decision support system for CRM enables to collect data about
customer from everytouch consolidate this information into a single view of the
customer, and use this informationfor customer profiling, segmentation, crossselling, up selling and retention efforts. As bankscontinue to seek a unified
understanding of customer relationships across diverse channels, theimportance and
penetration of CRM is expected to grow like anything.
1. From the analysis, it is found that only few customers recognize that there is a
change inmarketing approach of Banks due to changing business environment.
Majority ofcustomers uncertain that the CRM is centered in a particular department
very few of thecustomers have accepted that CRM is prevalent through all the

levels in the Banks. CRMundertaken by employee approach to customers is found

very poor. It is further observedthat the CRM activities are initiated and
implemented by the Banks in a serious manner,so that the customers in particular
and the society in general benefited a lot. Providingservice to customers has been
identified as the prime responsibility of the Banks andtherefore, Banks considered
that CRM is the best tool to perform the job of renderinggood services.

2. It is found that Customer Retention is not a big challenge to Banks as per the
opinions ofcustomers of selected Banks. It is found that though CRM activities have
not helped toincrease the confidence of the customers in meeting the changing
needs, it helped toincrease the confidence of the customers while rendering services
in mean timeefficiently. CRM activities of the selected Banks are not up to the mark
in retaining thekey customers.

3. It is beyond doubt that when banks through CRM activity attend the needs of
customerswithout delay in time, the banks can create more awareness to customers
and can create acustomer data base very significantly. According to the perception
of customersenhancing customer loyalty through different activities is not an

absolute activity.According to the analysis, it is observed that CRM activities have

not helped to increaserapport with the customers of the selected banks as expected.
Most the customers havenot accepted that the selected Banks are not showing
interest in CRM activities with fullattention but maintaining the same as a
compulsion. Most of the customers are uncertainabout the CRMs benefit in
building the customer loyalty. It is further observed thatCRM activity does not help
the Banks to get immediate commercial returns and also tohave a favorable public
image over the long run unless the CRM activities are taken upby all the
departments in the banks.

4. All the customers are uncertain about CRM of a Bank that contains creation of
completecustomer database. Technological advancement adopted by Banks was not
useful to getthe update and latest information over CRM.

5. Through the study, it is observed that the selected Banks customers are being
exposed tothe new techniques. It is found that CRM is centered only to a mention in
the Annualreport, of the public sector Banks. It is also observed that customers are
stronglydisagreeing and some of them are uncertain about CRM activity is

undertaken by e-Marketing by their banks. It is observed that the awareness level of

all respondents is lessas far as the other modes like advertisement etc. by the Bank
is concerned.

6. Most the customers have not accepted that the selected Banks are not showing
interest inCRM activities with full attention but maintaining the same as a
compulsion. CRMactivity has been felt as an additional workload by the employees
but they have feel CRM is useful to customers and also the Banks. The attention of
management on CRM activityis totally different between and among the Banks.

7. It is found that the technological necessities for the implementation of CRM do

notrequire the environments of advanced countries. The basic services providing
Infrastructure facilities and technological tools that are available in India suit the
Implementation of CRM by banking industry in India.


8. The reach of CRM of both SBI and other nationalized banks is compared and
testedthrough F Ratio. It is assumed that there is no significant difference between
theperceptions of customers of SBI and other nationalized banks towards CRM. As
thecalculated value (1.65) of F is higher than the standard value (1.54), the
hypothesis isrejected at 5% significant level and inferred that there is significant
difference betweenthe perceptions of SBI and other nationalised banks customers
towards CRM.

The customers of COMPANY are the wholesalers throughout India. COMPANY also export the
fabric to countries like Egypt and U.A.E.

The needs of the customers are clearly defined and the products are customized
according to the needs of the customers.

Customers comments and complaints are welcomed and resolved quickly and
positively. Comments and complaints are taken through face to face interviews.

The company conducts customer satisfaction surveys through research agencies.


The company provides credit facility to its customers up to 90 days. If the customers
pay within 7 days they are given 4% cash discount.

Sales persons of the company maintain frequent and informative communication with
the customers.

Business process is regularly reviewed to eliminate non value-adding activities.

The average sale per customer has increased by 15% and customers response to the
marketing activities is also improving. Customer retention is also improving.

The factors which have an impact on the CRM are organization culture, support from
top management, interpersonal skill of the sales personals and working environment
of the company.


The customers of the COMPANY are the wholesalers. It is because the number of
retailers is very large as compared to the wholesalers. So it is not possible for the
company to approach to the retailers. Therefore the company sells to the
wholesalers and then wholesalers sell to the retailers.
Customers are encouraged to give suggestions and complaints so that the company
can improve its working and services. If the customers complaints are not resolved
the customers will be dissatisfied and the company may lose its customers.
Different customers have different requirements. So the company customizes its
product accordingly to satisfy the customers. It also gives more choice to the
To get the information about the customers and to measure the satisfaction the
company conducts surveys. Because of the expertise needed in the research the
company give this work to research agencies like AC NILSON.


The company gives credit facility to its customers to increase the sales volume. If
the company do not sell on credit the customers may switch over to other
The company maintains frequent communication with the customers. As soon as the
product is ready or a new product is launched the information is provided to the
customers. Communication is also necessary to maintain the interest of the
customers in the company.
The company gives concession to its regular customers so as to retain its most
valuable and profitable customers.
The company regularly reviews the business process in order to eliminate non
value-adding activities, to reduce the cost and to make the whole work efficient and
effective. If the internal customers are not satisfied and there is lack of coordination
among the departments then it will affect the external customers also.



The general discussion can be said that the bank is yet to develop an integrative
approachwhich focuses on the customer needs and to deliver to it. As shown by the
study, the bank is farfrom developing a customer centric approach both for the
customer as well as for the employees.Thus, for customer relationship management
to deliver to its expectations, it should play anintegrative role within the bank and
ensure that all processes are integrated in the bank globalstrategy, which is far from
reality in the study above. In view of this, to implement a CRMintegration strategy,
the following recommendations can be adopted:

1. The Indian Banking Sector is flooded with different banks of the same molecule.
Insuch a competitive environment, the Banks should adopt suitable marketing
skillsrather than depending on the trading skills. Hence, new services should be

constantlyintroduced to ensure the growth of the Banks and to be competitive in the

market andto keep up the enthusiasm of the employees and customers etc.

2. Implement a Customer Centric Process in Banks.









4. Increase customer experience through the web site.

5. Develop channel integration for effective Customer Relationship Management.

6. Proper training should be given to the bank personnel regarding the behavioral
patterns by the Banks before they come and work in the field.

7. More importance should be given to handling online transaction and using

commerceand mobile banking services.


8. It should be realized that customer relation cannot be built overnight. CRM

should beconsidered as Continuous Relationship Management.

9. Data gathered from the customers should be given proper value and it should be
Properlyutilized. Decision making authority should be extended to field force and
some resources should be given for faster implementation.

10. The Banking sector is developing and getting higher day by day in urban and
semiurban areas; there is large number of customers using the services in the urban
andsemi urban areas. So a wide scope in rural areas is expected in the days to
come.Based on the analysis it is very clear that in almost all issues, the working
performance of SBIand other nationalised banks is similar but differing at certain
aspects only.


The SBI though it ispublic sector bank, taking much care in implementation of
CRM, fine tuning the CRM andfinally putting it on track. Whereas, other
nationalised was not at par with SBI in most of theaspects like database
management, responding to the customers in mean time andprovisionaising the









approach,considering customer retention as a big challenge, provisioning the

facilities attending the needswithout delay in time, meeting the changing needs
creating the database, employee approach tocustomers, customer awareness impact
of CRM relationship with customer impact over bankobjectives, CRM and public
image, CRM and updating the data, CRM and customer satisfaction,other
nationalised is found quite good. On the other hand, in terms of retention of existing






infrastructure, location ofCRM, existence of CRM, approaches of CRM, coverage

of CRM by e-Marketing, relationshipwith the customer, CRMs objectives and
making the customer delight, retention of customersbenefits of CRM to the
organisation, loyalty, customer confidence, are found quite satisfactoryand in good
condition with SBI. It is very clear from the foregoing analysis that the approach of

CRM by SBI and other nationalised are to some extent same and one but the reach
is quietdistinguishable. It is due to the profile, their capability and the strategy of
CRM in making it andreaching down to customers. On the contrary, it can also be
asserted that the background of bothbanks also found as a big cause for reaching the
top CRM. Hence, CRM is an inevitable tool ofmarketing that can be considered as
Critical Responsibility of Market with regard to Banks inpresent context. The
results in this study show the respondents either agree or strongly agree on majority
of the statements in the dimensions used. This study is significant to banks as they
getinformation on what are items that are important to customers so as to maintain
the relationship.


Limitations of Customer Relationship


Time constraint is unavoidable limitation of my study.


Financial problem is also there in completing this project in a proper



As no work has been done earlier in this regard so scarcity of secondary

data is also



Inadequate disclosure of information is also the problem.



There should be more and more emphasis given by the company for satisfying the
customer up to a apex limit and by providing the utility of every penny of his

There should be more use of information technology.

The company should be flexible to bend its rules and procedures in the clients

The company can communicate and develop stronger customer bonding by

providing social and financial benefits.



Who are your customers?



b) Retailers



Are your customers needs clearly defined ?



b) No


Do you conduct customer satisfaction surveys?



b) No


Do you communicate results of your customer satisfaction surveys regularly throughout

the company?



b) No


Do you actively seek out customer comments and complaints?



b) No


How do you get customer comments and complaints?


Face to face interview.

b) Toll free numbers, formal surveys.



Others means

How do you get information about the customers?


Face to face interviews

b) Surveys.


Any other means.

Do you analyze channel effectiveness? ie which channel is most effective in serving the


b) No



Do you provide credit facility to your customers?



b) No

10. Do you give concessions to your regular customer?



b) No

11. Do you take feedback from your customers?



b) No

12. Do you customize your product or services according to the customer?



b) No

13. Do you have a concept of internal service?



b) No.


14. Do you communicate with your customers frequently?



b) No.

15. Do you regularly review the business process to eliminate non value- adding activities
and improve customer satisfaction?


b) No.

16. Is the working environment is conducive to the well-being and morale of all employees?


b) No.

17. How much is the role of computers in serving the customers?


Plays a big role

b) Not much role to play


No role to play.


18. Do you have centralized database for customer information?



b) No such database.

19. Does the staff have access to the customer database?



b) No

20. Is there commitment from top management to support the customer-focused service


b) No

21. Is there any improvement in average sale per customer?



b) No

22. Is there any improvement in customer response rate to the marketing activities?



b) No

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