Problem Solution: TeraTech 1

Running head: PROBLEM SOLUTION: TERATECH

Problem Solution: TeraTech University of Phoenix

Problem Solution: TeraTech 2

Problem Solution: TeraTech According to Kerin (2006), Customer Relationships Management (CRM) is the process of recognizing potential buyers, understanding them thoroughly, and developing positive company long-term observations and products or services offered so that consumers will select them in the market. TeraTech is a five-year-old Customer Relationship Management (CRM) solutions provider in the pharmaceutical industry. Technologies that support this business purpose include the capture, storage and analysis of customer, partner, vendor, and internal process information of the company. Functions that support this business purpose include sales, customer service, marketing, performance management training, professional development, human resource development, and compensation. TeraTech has been successful with their existing customer relationship management (CRM) product and in the Pharmaceutical industry. As customer relationship management (CRM) offerings go beyond basic functions and into modeling and analytics, the company needs to be presently looking for growth opportunities. TeraTech CEO has proposed a new product would combine TeraTechs customer relationship management (CRM) expertise with analytics and modeling; the results would allow pharmaceutical companies to maximize the value of their data and refine their marketing efforts to maximum effectiveness. Describe the Situation Issue and Opportunity Identification The TeraTech scenario provided the following information and is a brief description of some of the important events that led to the identification of the issues and opportunities in the TeraTech scenario. Recently TeraTech has had more competition;

Problem Solution: TeraTech 3

competitors within the pharmaceutical industry are now offering Customer Relationship Management (CRM) technology that goes beyond basic functions by adding modeling and analytical tools to the software. Due to the rapid changes in technology, with the current TeraTech Customer Relationship Management (CRM) product meeting the customer needs have become difficult. After running the Customer Relationship Management (CRM) system for two years, TeraTech is currently not meeting the Return on Investment (ROI) and sales targets that the customers were expecting. TeraTech marketing team has not yet been able to make use of the data located within the sales and customer service teams. Therefore, TeraTech marketing department wants to take into consideration expanding TeraTechs product to include analytical tools. If TeraTech integrates their current Customer Relationship Management (CRM) product with new analytical capabilities and a tool that will be able to assist integrating customer data, this could create opportunities with customers in the pharmaceutical and other industries. Stakeholder Perspectives/Ethical Dilemmas The TeraTech scenario provided the following information that discusses the values of the key players and stakeholders. One of the key dilemmas that TeraTech has is the key players of the company from Jack Dwyer, the Chief Executive Officer (CEO) to all the other key play conflicting values with each other. The employees and management should have the same perspectives about the new marketing plan for a new customer relationship management (CRM). This product will have the analytical tools in order for the company to sustain growth and increase profitability. Jack Dwyer, also foundered TeraTech, stated that he has three main objectives that he wants the management team to focus on during the development of a new marketing plan the first more sales second a

Problem Solution: TeraTech 4

new analytical customer relationship management (CRM) product and third the customer concerns. Christine DeFalco, the Chief Marketing Officer (CMO), needs to have an assistance of the management team with the common goals and skills to help develop a marketing plan for the new customer relationship management (CRM) software, which needs to be present to the Board of Directors. Christine DeFalco perspective is that TeraTech needs to look beyond the pharmaceutical industry and to develop a growth opportunity, which has TeraTech and the CEOs interest and goals developing a new customer relationship management (CRM) software. Christine DeFalco initially presents an idea of partnering TeraTech with a company outside of the pharmaceutical industry in order to acquire the analytical tools that TeraTechs customer relationship management (CRM) needs. June Corso, Senior Vice President, General Legal Counsel TeraTechs legal counsel, has stated that a partnership provides too many legal risks, and can possibly make it difficult for the TeraTech to remain focused on their customer needs. However, if TeraTech conducted an acquisition, this would eliminate many legal risks that can develop during a partnership process. The CEO and legal counsel would not have to worry about any confidential information is mishandled if the partnership splits, or financial resources are being drained in court battles between partners. Chris Riggs, VP of human resources, Chris Riggs stated that there would be no newhires for TeraTech this coming year. Many issues conflict with the perspective of the VP of human resources. First, Chris Riggss concerns do not appear to show how he can help benefit the growth of the company or contribute to a new customer relationship management (CRM) product. Chris Riggs does state that this would manage company

Problem Solution: TeraTech 5

expenses, but to whose benefit, in what way, and how much of an expense to the company it would save. Second, Chris Riggs does not appear to show any initiative to work with Christine DeFalco in developing suggestions from a human resources perspective that would benefit a marketing plan for a new customer relationship management (CRM) product. Finally, the most negative aspect of his action, suggestion, or lack of suggestions is that he sent an e-mail to Christine DeFalco, the Chief Marketing Officer (CMO), regarding no new-hires, but did not ever address this e-mail to the CEO, in addition, Chris Riggs states that any replacements would have to be Board-approved. Wendy Martin, the Chief Technology Development Officer, has stated that it would take $100 million and two years to rollout a new customer relationship management (CRM) analytical product internally. This period not only conflicts with when the CEO wants the new product to be up and running, but if TeraTech does not acquire analytical tools to there customer relationship management (CRM) system, they will begin to lose the existing customers to the competitors. Frame the Right Problem TeraTech must become an organization that can maintain there profitability, a competitive advantage, and satisfactory customer service levels that keep TeraTech the dominant leader in the pharmaceutical industry and develop a new customer relationship management (CRM) system. To product through realizing opportunities of an acquisition of a smaller company that successfully used analytical tools in another industry. In addition, through the precise adjustment employees and management TeraTech will build cross-efficient teams that will take the developed new product from idea to launching a new customer relationship management (CRM) analytical tool. Once the product is

Problem Solution: TeraTech 6

developed, TeraTech needs to develop a customer service line this would create an opportunity for TeraTech customer to provide quick and vital feedback. Describe the End-State Vision TeraTech maintained growth, ensured an increase in profitability, and sustained a competitive advantage based on providing outstanding value to TeraTech current and future customers through the high quality, customer relationship management (CRM) analytical tool. This newly developed customer relationship management (CRM) analytical tool product was through the acquisition of a smaller company in another industry that has been successful in providing analytical products to satisfied customers. Identify the Alternatives and Benchmarking Validation Task A: Problem/Opportunity Statement TeraTech must develop a new product to reach satisfied customer service, maintain the competitive advantage, and ensure profitability. TeraTech has an opportunity to increase there profits and they can achieve double-digit growth by changing the focus of their organization to developing new and improved Customer Relations Management tools. These new tools can provide a technical solution that will offer analytics and modeling while integrating all aspects of the pharmaceutical business. By doing these TeraTech can stay a dominant factor within the pharmaceutical industry. Response to Task A: Microsoft (Successful) For a Customer Relations Management (CRM) solutions provider to sustain growth, it is essential that a Customer Relations Management (CRM) software solution is easy for the customer to use and be flexible. The software must bridge gaps between customer and

Problem Solution: TeraTech 7

companies. Ensuring the systems are easy to use will ensure customer satisfaction with the system. TeraTech system needs to be customer friendly. If the system can bridge the gap between the customers and the company, then the system will be a success. The system should also be kept up-to-date. USC and Idaho State Universities (Successful) Many schools have come understood the need from the students for distance learning courses. (Shute, 2006) By understanding the students needs and by supplying them with what they want is part of customer service. By using the online technology this has increased enrollment and improved customer service levels at the Universities. An alternative solution for TeraTech could be actively and effectively listen to the employees and customers for future developments of products. By improving the current customer relations management (CRM) will improve TeraTech customer service only if the changes requested are implemented. Starbucks Coffee (Successful) Starbucks is an extremely profitable, the company earning in 2004 excess of $600 million. Starbucks was noted for there creativity and new product development. In a SWOT analysis Starbucks has the opportunity to develop new products and services; these services and products can be sold in coffee shops. However, a threat to the company, Starbucks is exposed to the dairy products and cost of coffee rising and falling in the market. Thinking about the research toward Starbucks, one alternative solution for TeraTech is to perform a SWOT analysis. TeraTech can assess what there weaknesses are and measures could be taken to strengthen the weaknesses.

Problem Solution: TeraTech 8

Task A. Problem/Opportunity Statement TeraTech must decide on how they will introduce the new product and to make sure all departments are working together as a team before introducing to companies. By doing this TeraTech will have a marketing plan. Siebel (Successful) Siebel was founded in 1993 by Thomas Siebel and is a division of Oracle. Oracle bought Siebels company in 2005. Siebel produces customer relations management (CRM) software for many different companies. In 2005 Siebel decided that it needed to expand the company this decision was made because their sales began to drop. Siebel sales were 1 billion dollars in 2000-2001 and in the end of year 2004 the sales were only about 500,000 dollars. Siebel knew that the customer relations management (CRM) business product was becoming overwhelmed and the Siebel must develop new software or go out of business. The reputation of Siebel is good for pre-built customer relations management (CRM) solutions and with idea, Siebel began to develop a new customer relations management (CRM) solution Siebel called this software Nexus (S. Crowley, 2005) that was to take the company to the next level in CRM solutions. There was a period when Seibel was partner with Microsoft the two were developing a customer relations management (CRM) solution. Microsoft made a decision that they no longer want to continue the partnership and broke away from Siebel. Siebel later found out that Microsoft was developing a customer relations management (CRM) solution and Microsoft produce would target users who were using Siebel software.

Problem Solution: TeraTech 9

Evaluate the Alternatives In evaluating the several goals of TeraTech, meeting and or exceeding the customer needs and possibly in creating new needs is one of the most important objectives when developed a new product. Therefore, this goal was given a high rating of 5. Customer relationship goal was given a 5. This states that through customer feedback, having customers indicate that the new customer relations management (CRM) analytical product and the company as a whole will met and exceeded customer needs. With the first goal it was given a ranking of 4, this was for to meet or exceed the financial targets in the marketing plan. This is necessary because without the proper finances in place, the marketing plan could not be effective and TeraTech would not be able to introduce a new product in order to sustain company growth and increase company profitability. The second goal that was given a rating of 5 it was for the alignment of employees and management about the common goal of a new customer relations management (CRM) analytical product. This is just as important because a great deal of expense and time could be wasted if one critical team member is not in agreement with the new product and the marketing plan. First, the alternative of having a new customer relations management (CRM) analytical system that is frequently up dated, this is done to ensure that no behavior that is repetitive and non-effective in sales occur. Combines with the alternative of TeraTech as a team be in alignment of introduction of the new customer relations management (CRM) analytical product. Second, the alternative of having a new customer relations management (CRM) analytical system that is frequently up dated, this is done to ensure that no behavior that is repetitive and non-effective in sales occur. Combined with the

Problem Solution: TeraTech 10

alternative of having a new customer relations management (CRM) analytical system helps bridge the gap between TeraTech as a company and their current and any future customers. The third alternative is the combination that would have a new CRM analytical system frequently kept updated in combination of TeraTech as a team being in alignment of introduction the new CRM analytical tool. Identify and Assess Risks Several of the issues and opportunities of the companies in the previous benchmarking section assisted in sizing down alternatives that could assist TeraTech in reaching the ideal solution for the company. The action of TeraTech taking part in a partnership was ruled out due to the risks that the benchmarking company of Siebal faced in their joint venture. A major portion of expenses was probably used in legal fees in order for Microsoft to split from the partnership with Siebal. After the split with Microsoft, Siebal discovered that Microsoft was developing a customer relations management (CRM) solution of their own, which was going to target the customers of the Siebal Company. When a partnership is conducted, a company takes a risk with valuable information being shared with the other company and later that information being misused against them. Several of the benchmarking companies did not state if they had conducted a strengths, weaknesses, opportunities, and threats (SWOT) analysis. Many unavoidable risks can develop if an organization, especially one looking to sustain growth, does not evaluate there strengths, weaknesses, opportunities, and threats (SWOT). The Starbucks briefly discusses in their benchmarking analysis. Looking at new product development and profits, conducting a strengths, weaknesses, opportunities,

Problem Solution: TeraTech 11

and threats (SWOT) analysis was necessary for Starbucks to remain competitive in there market, Make the Decision To achieve the following ideal solution and evaluating the pros and cons, TeraTech will be able to realize the desired goals. TeraTech will become a company that maintains profitability, a competitive advantage, and satisfactory customer service levels to stay a dominant leader in the pharmaceutical and adding the additional industry by developing a new analytical customer relations management (CRM) product through realizing opportunities of the acquisition of a smaller company that successfully uses analytical tools in other industry. In addition, through aligning employees and management, TeraTech will build efficient teams that will take the new product from idea to launching the new customer relations management (CRM) analytical tool. Once the product is completed, TeraTech will develop a customer service line, which will create an opportunity for TeraTech to receive quick and vital feedback from the customers. Develop and Implement the Solution TeraTech implementation process will concentrate on short-term deliverables. The first action item that needs to be delivers is the proper selection of a partner that will help in the design and creation of the new CRM analytical product, this timeline should be no more than 2 months. Top management and IT department should decide on which partner TeraTech should go with. Once the partner has been chosen and has accepted to challenge, the execution of a detailed partnership agreement. Evaluation the Results

Problem Solution: TeraTech 12

The first goal to obtain an increase in profits margins and revenue by 10% within the first year of implementation, and 5% every year after that TeraTech quarterly income statements and balance sheets will support the metrics. The increase of customer satisfaction with the customer relations management (CRM) analytical product, based on quarterly Customer Feedback Reports, TeraTech expects to become 10% better, and 5% increase every year after. The expansion of the new CRM analytical tool to other industries should to happen within the next year. Conclusion TeraTech will become a company that maintains profitability, a competitive advantage, and satisfactory customer service levels to stay a dominant leader in the pharmaceutical and through realizing opportunities of the acquisition of a smaller company that successfully uses analytical tools in other industry. In addition, through aligning employees and management, TeraTech will build efficient teams that will take the new product from idea to launching the new customer relations management (CRM) analytical tool. Once the product is completed, TeraTech will develop a customer service line, which will create an opportunity for TeraTech to receive quick and vital feedback from the customers.

Problem Solution: TeraTech 13

Reference Berry, T. (2005). Evaluating Strengths, Weaknesses, and Opportunities. StrategicPlanning Weekly. 15(6), 67-76. Retrieved May 26, 2009, from ProQuest database. Cowley, S. (2005) Will Nexus Save Us. Info world. Retrieved, May 26, 2009 from www.Inforworld/HNsiebelnexus_1.htm. Kerin, R., A., Hartley, S., W., Berkowitz, E., N. & Rudelius, W. (2006). Marketing (8th ed.). New York: The McGraw-Hill Companies. McShane, S. L., & Glinow, V.M. (2004). Organizational Behavior: Emerging Realities for the Workplace. New York: McGraw-Hill. Shute, N. (2006). The Long & Short of It. ASEE Prism. 15(8), 34. Retrieved May 26, 2009, from ProQuest Education Journals database. University of Phoenix. (2009). Week one scenario TeraTech. Retrieved May 14, 2009 from University of Phoenix, Week One, rEsources, MBA 570.