Customer Relationship Management Practices

At
Punjab & Sind Bank

MBA Gen
Submitted To:Dr. Ashutosh Kumar

Submitted By:Mr. Surojit Jana

Mr. Vikas Singh
Mr. Deepak Rastogi
Ms. Vishal Gaurav Singh
Mr. Yahya Khan
Mr. Shwetank Oli

Objectives

To study the CRM functioning and effectiveness of the PUNJAB & SIND Bank in
Gurgaon.
To study the advantages of CRM schemes introduced by PUNJAB & SIND Bank to its
customers.
To study the various customers oriented schemes introduced by PUNJAB & SIND Bank
in the interest of its customers.

Scope and Utility

This study has concentrated all the services in general. One can also do comparative study of
various banks and their approach towards the customers. In the present competitive business
world it becomes necessary to align organization towards customers, Integrate customers touch
points, knowing and understanding customers and potential customers, Establishing and
managing relationships with customers. Thus CRM is need of this hour.

Limitations
The study is limited to respondents from Gurgaon.

This project concentrates on the services given to customer in general. Therefore it is

difficult to study the view of the customers towards one particular service.
It was difficult to study what happens to customer satisfaction when we initially perceive
a service provider as being less than general then over time, that service provide, warms
up unexpectedly?
Finally, this study did not examine whether courteous expressions on personal
connections play a role in other customer outcomes such as loyalty and word-of-mouth
referrals.

OVERVIEW OF PUNJAB & SIND BANK

Punjab & Sind Bank (P&SB) is a government-owned bank (81.42%) in Northern India, with
headquarters in New Delhi. Of its 1416 branches spread throughout India, 530 branches are in
Punjab state. Its net profit is 339 crores and net NPA is 2.14% for the year ending 2012-13. The
banks net profit for the quarter ending June 2013 is 122 crores. Total business of the bank is
1,42,000 crores. Business per employee is 14 crore & business per branch is 108 crores.

HISTORY
In 1908, leading figures in Amritsar such as Bhai Vir Singh, Sir Sunder Singh Majitha, and
Sardar Tarlochan Singh founded Punjab & Sind Bank to help the weaker sections of society.
On 15 April 1980 Punjab & Sind Bank was among six banks that the Government of India
nationalized in the second wave of nationalizations. (The first wave had been in 1969 when the
government nationalized the top 14 banks.)
At some point in the 1960s Punjab & Sind Bank established a branch in London. In 1991 Bank
of Baroda acquired Punjab & Sind Bank's London branch at the behest of the Reserve Bank of
India following Punjab & Sind's involvement in the Sethia fraud in 1987.
Since 2004 Punjab & Sind has again shown growth of more than 40% year on year. Recently its
IPO received tremendous response from the public and the issue was oversubscribed by more
than 50 times. Recently the bank crossed a mark of Rs 1 lac crore in business.
Setluj Gramin Bank is a sponsored bank by Punjab & Sind Bank.

Introduction to CRM
CRM is an acronym for Customer Relationship Management. Its a set of strategies, processes,
metrics, organizational culture and technology solutions that enhance an organization's ability to
see the differences in its present & prospective customers, track new opportunities to better serve

customers and act, instantly and profitably, on those differences and opportunities. Recently
CRM has taken a centre stage in the business world with businesses concentrating on saving
money and increasing profits by redefining internal processes and procedures. It costs a company
dramatically less to retain and grow an existing client, than it does to court new ones. The aim of
CRM is to optimize the use of technology and human resources.
CRM services consist of the following major segments:

Consulting services
Implementation services
CRM Outsourcing services
Training services

Emphasizing on the importance of CRM one of the PUNJAB & SIND employees said, With the
overall improvement in the ETL1 process made possible by Power Centre, we benefited from
greater data immediacy for business users and more reliable information, which resulted in
quicker analysis and timely reporting.
said one of the employees at PUNJAB & SIND Bank, Mumbai CRM at PUNJAB & SIND
Bank involves increased communication between the bank and its present and prospective
customers. Its philosophy focuses on each and every customers satisfaction.
CRM facilitated coordination of multiple business functions & multiple channel of
communication with the customers to carry out customer management more efficiently. It also
automated the process flow tracking in the product sales process and helped generate customized
reports and promote cross-selling.
The typical components of a CRM strategy at PUNJAB & SIND are as follows:

- Understand and differentiate: Understanding customers is important in order to develop a

sound relationship with them. Customer profiling is done in order to understand demographics,
purchase pattern and channel preference. CRM also helped PUNJAB & SIND in valuation of its
customers to understand customer profitability and Customer Life Time Value (CLV).
- Develop and customize: - In a customer centric business environment, the products and
processes have to be according to customers needs and preferences. PUNJAB & SIND has always
focused on developing channels of service delivery according to customers need and service expectation.
- Interact and Deliver: To foster a strong customer relationship PUNJAB & SIND ensured that all
areas of the bank have easy access to relevant, actionable customer information and employees should be
trained on how to use customer information to tailor interactions based on both customer needs and
potential customer value.
- Acquire and Retain: CRM helped PUNJAB & SIND to figure out valuable customers and made it easy
to formulate retention strategies for them. It also helped it cope up with the change in customers life
cycle and offer services accordingly.

Need of CRM in the Banking Industry:

A Relationship-based Marketing approach has the following benefits: 1. Over time, retail bank customers tend to increase their holding of the other products from
across the range of financial products / services available.

2. Long-term customers are more likely to become a referral source.

3. The longer a relationship continues; the better a bank can understand the customer and his/her
needs & preferences, and so greater the opportunity to tailor products and services and cross-sell
the product / service range.
4. Customers in long-term relationships are more comfortable with the service, the organization,
methods and procedures. This helps reduce operating cost and costs arising out of customer error.
With increased number of banks, products and services and practically nil switching costs,
customers are easily switching banks whenever they find better services and products. Banks are
finding it tough to get new customers, and more importantly, retain existing customers.

The Processes for Delivering CRM:

The tools and the processes are as follow

Customer application form

Centralized software where the whole data is collected.
Wide range of offerings
Cross selling
Feedback forms

1. Customer Application Forms:

Bank collects all the data from customer application form and gets the personalized information
to know which product to offer to which customer. This process helps in collecting the data and
knowing what the customer wants.

2. Centralized Software where the Whole Data is Collected:

The data collected through customer application forms is available at one server and can be
accessed anytime, anywhere. So, this helps in the further process of customized offerings and
cross-selling.

3. Wide Range of Offerings:

After collecting the data from the customer, team decides what product to offer to which
customer. In case the bank recognizes you as a valuable customer then is offers a more
customized service.

4. Cross Selling:

It refers to offering another product from the service offering of the bank to the customer which
he has not gone for. For example if customer has savings account with the bank then they offer
him a insurance, fixed deposits etc. This depends on the value of the customer to the bank. Cross
selling is not offered to every customer. It depends on how loyal the customer is to the bank. The
more business he gives us, the more are his chances of being special services offered.

5. Feedback Forms:
The bank distributes feedback forms at all its branches. The customers feedbacks on the service,
technology used, employee behavior and promptness in solving customers problems, are taken
and they are analyzed. CRM helps to know the needs and wants of the customer. So, on the basis
of this company can decide which product to offer to which customer. It has been observed that
cross selling is the best weapon. It enhances the relationship value with the customer. This
satisfies the customer and that is the reason why the customer keeps on coming again and again
to the company. This helps in retaining the market share. Now, the satisfied customers help in the
word- of mouth promotion of the bank, which eventually increases our market share.

IMPORTANCE OF CRM:
Create single window access for sales and service teams

Generate real-time reports across teams, products and geographies.

Move from fragmented to a unified multi-system collated reporting.

Establish an efficient analysis path using drill-down capabilities.

Provide actionable insights to decision making.

Boost results by measuring and improving critical performance indicators.

Ensure faster lead conversion

Manage all leads on a single platform across various channels of acquisition.

Automate lead assignment to increase efficiency and reduce response time.

Introduce leads nurturing strategies using direct marketing.

Eliminate duplicate lead across channels.

Improve efficiency and reduce waste

Undertake hassle-free process implementation across various departments.

Build escalation alerts to ensure timely action.

Minimize process wastage using exceptional reporting mechanism.

Free up valuable time to pursue leads and grow business.

Get rid of cumbersome data entry and updates at multiple points.

Increase customer profitability

Segment customers in value bands.

Facilitate strategic shift from accounts to value based relationships.

Run focused programs to improve customer portfolio quality.

Increase wallet-share by boosting cross-selling.

Use referral management to generate low cost leads of high quality.

Enhance customer experience and satisfaction

Collate and service all customer requests on a single platform.

Ensure timely resolution with multi-department workflows that are highly synchronized.

Ensure consistent customer experience at all touch points.

Monetize service satisfaction and goodwill by using service to sales process.

IMPLEMENTING CRM AT PUNJAB & SIND BANK

CRM Practices in Punjab & Sind Bank Technology-based CRM Technology plays the role of
enabler in CRM deployment and allows Punjab & Sind Bank to achieve greater customization
and better service at lower cost that helps in better customer identification and fast and
convenience services to its customers. Customer Loyalty Programs Punjab & Sind Bank has an
aim to be a customer centric organisation and build a favorable and long term relationships with
its customers. Loyalty has both an attitudinal and behavioral dimensions to adjudge the
customers based on their value and attachment with the bank. Behavioral loyalty will include
examples like maintaining long term relationship with bank, word of mouth, etc while attitudinal
loyalty will comprise examples like trust or emotional attachment. Further, behavioral loyalty
does not necessarily reflect attitudinal loyalty, thus, Punjab & Sind Bank focuses on attitudinal
loyalty through its various loyalty programs, marketing communications to emotional touch the
target customers because loyalty leads to more business and increase in bottom line of the bank.
It has four loyalty cards based on value of the customers such as Platinum, Gold, Silver and
Bronze. It helps in identifying the most valuable customers and plans the different offers,
schemes and services as per their needs and preferences. The Data warehouse is the core of any
decision support system and hence of the CRM. In implementing its Data Warehouse Punjab &
Sind Bank has selected an incremental approach, where the development of information systems

is integrated with the business strategy. Instead of developing a complete design of a corporate
Data Warehouse before implementing it, the bank has decided to develop a portion of the Data
Warehouse to be used for customer relationship management and for the production of accurate
and consistent management reports.
The key to implementing CRM was in understanding organization and customers in a better way.
There are five interrelated areas that were taken care of before implementing CRM:
- Business Focus
- Organizational Structure
- Business Metrics
- Marketing Focus and Technology
Business Focus: There are various components of CRM like customer information, sales,
marketing trends and marketing efficacy that acted in tandem to improve relationship between
PUNJAB & SIND and its consumers. PUNJAB & SIND captured customer data and analyzed
them while dealing with customers at these very touch points. A CRM solution from Siebel was
implemented for the automation of customer handling in all key retail products of the Group. The
solution allows customer service agents to track all customer complaints and requests. It also
allows target setting and centralized tracking of turnaround times for request fulfillment. The
solution went live in phases during fiscal 2002. The Bank has also undertaken a retail data
warehouse initiative to achieve customer integration at the back-office. This central view of the
total customer relationship is being used extensively for identifying opportunities to cross-sell
new products and services to the existing customer base.
Technology Focus: PUNJAB & SIND Bank continues to leverage ICT2 as a strategic tool for its
business operations to gain competitive advantage. Its technology strategy emphasizes enhanced
level of customer services through 24x7 availability, multi-channel banking and straight through
processing, and cost efficiency through optimal use of electronic channels, wider and focused
market reach and opportunities for cross-selling. The Technology Management Group (TMG) is
the focal point for the PUNJAB & SIND Groups technology strategy and Group-wide
technology initiatives.
This group reports directly to the Managing Director & CEO. A key to PUNJAB & SINDs
success has been its ability to harness business information to CRM initiatives that have fueled
growth and helped attract more than 30 million customers.
The foundation for PUNJAB & SIND Banks wide-ranging CRM programs is a Sybase IQ-based
data warehouse. Developers had used a combination of PL/SQL and BTEQ scripting, a
proprietary technology specific to the data warehouse, for data extraction, transformation, and

loading (ETL). With its growing customer base, IT administrators recognized that the bank
needed a more powerful, sophisticated data integration system to help ensure the warehouse
lived up to its potential as an analytic CRM engine that delivered tangible bottom-line results. To
step up to the next level of data integration, PUNJAB & SIND Bank officials agreed with a
recommendation from Teradatas professional services division, which provided systems
integration support for the data warehouse, to implement the Informatics Power Center enterprise
data integration platform. (The Bank initially used Teradata as its data warehouse platform and
migrated to Sybase IQ a year ago.) PUNJAB & SIND Bank deployed Power Center in 2003 as it
embarked on the next phase of its warehouse, which would add data from five new sources, in
addition to the initial three sources of retail banking, credit cards, and securities information.
The next step in the CRM implementation process was gap analysis which essentially is
assessing different loopholes in:
- Marketing, sales and service practices
- Collection, capture, processing and deployment of customer information
- Distribution and operations effectiveness at customer touch points

BENEFITS OF CRM IN PUNJAB &SIND BANK:

The implementation of CRM in banking sector generates benefits not only to banks but also to
the customers.
The following are the prime benefits of CRM systems for the banks: improvement in customer
service, value enabled cross-selling which in turn increase revenue, automation of banking
processes, improved communication, better control on quality of customer details and product
details, collection of customer data, effective surveys and marketing strategies. The CRM makes
bank to focus on its customers to satisfy customer and make profits for the banks with the help of
information and analysis tools of CRM. It increases the overall profitability of the bank like
better infrastructure, easy training of employees, customer acquisition, retention, and
profitability. The CRM increases the customer satisfaction which leads to the customer
retentions. CRM helps the bank to achieve the centralization of information which helps the firm
to manage and integrate process, people and technology. It helps the banks to understand the
customers. CRM enables the bank to segregate the customers into various segments and helps
them to customize the service based on various segments. It helps bank in creating demands
through multi-channel and multi-wave campaigns which in turn resulted in aggressive customer
acquisition. It provides the bank employees with 360 degree view about their customers, which
means the transparent transactions through a single window. This 360 degree view acts as a
framework to accelerate the cross-selling of different products to the customer.

The CRM increases the operational efficiencies and collaboration by automating the process and
business activities which in turn reduces the process time and manual tasks. The multi lingual
ability of CRM helps the bank to deal with the customers very easily. It also helped the bank in
running campaign management and integrating the information about customers from various
channel.
The implementation of CRM leads to the building of central repository for all products offered
by the bank, pricing of its products, competitive information, internal training material,
presentations for sales, templates for proposals and marketing collateral. This repository helps
the bank to improve its efficiency. This also improves consistency and transparency in the
organization by giving 360 degree view of the organization to all employees. The CRM helps in
fast and consistent decision making based on the data in repository and customer understanding
aspects of CRM. It helps the organization to manage the leads and opportunities into business
through proper follow ups and interactions. The operational inefficiencies can be reduced with
the help of CRM. It integrates customer interactions through phone, fax, e-mail, online portals,
wireless devices, ATMs, and face to face contacts with bank employees at the operational centers
and also connects to relevant internal and external partners. All the above information can be
used with business intelligence systems to do predictive analysis.
The CRM in banking benefits customers by convenience banking like online banking, ATMs,
mobile banking, etc. It helps the customer to give feedback and also helps them to know about
more products which are beneficial to them.

Problems faced by PUNJAB & SIND Bank while implementing

CRM:
1. Missing Key Information: CRM data often contains gaps in information. Relying on basic
demographic data or purchase history is no longer sufficient. Supplement basic info with more
detailed information, such as purchasing preferences or Web history. Without this type of
information, it's difficult to understand how to reach customers effectively.

2. Out-of-Date Information: Customer information changes often, but the data marketers most
use to reach customers doesn't always update as quickly as we'd like. Whether a consumer has
moved to a new city or has changed his or her purchasing habits, campaigns will not be effective
if marketers are relying on information that does not update as customers' lives change.

3. Incorrect or Unverified Data: Similarly, the data used for marketing campaigns needs to be
accurate from the start. Marketers of banks often rely on unverified data that could be incorrect.
For marketing campaigns to be effective, it is crucial for marketers to reach consumers in a
highly targeted way. Without verifying information, marketing efforts and resources could be
wasted.

4. Lack of Insight: Even if CRM data is up-to-date and accurate, it's still just data. It provides
banks with as much information about a customer as possible, but doesn't reach conclusions.
Banks need to use this information to uncover their own insights to effectively reach consumers
at the right time, through the right channel and with the right message.

5. Inability to Find New Prospects: While CRM data can be useful for reaching current
customers, it does not help banks reach new customers. It's important for banks to effectively
reach consumers who have the potential to become loyal, long-term customers.
6. Privacy Concerns: CRM databases are not responsive to the challenges of multichannel
marketing in an increasingly privacy protected society. It is important for banks to identify and
contact clients and prospects according to their unique privacy requirements.

CRM data can be very useful and often leads to highly successful campaigns. But marketing
people of a bank needs to keep these potential issues in mind before relying on this information.
Overlooking these common problems leads to incomplete or inaccurate profiles of your
customers and can lead companies down the wrong path.

CRM Strategy used by PUNJAB & SIND BANK:

The CRM strategy in Punjab & Sind bank is the direction and scope of the CRM initiatives of the
bank over long-term to configure the CRM system in the challenging and competitive market to
meet the needs of the market and stakeholders. In another way, the core of CRM strategy is the
creation of mutual value to customers, employees, and banks itself. The aim of the bank in this
challenging and competitive market is to attract and retain its customers through appropriate and
personalized customer service. Based on the aforementioned aim, banks have the following three
CRM strategies; acquiring, enhancing, and retaining the customers of the bank:

In acquiring strategy, CRM is used to make differentiation, innovation, and convenience in

banking experience which may lead the banks to attract new customers.
In retaining strategy, the role of CRM is to retain the existing and new customers by listening to
their needs and innovating new products that create a value to their customers.
In enhancing strategy, the role of CRM is to bundle the offers accurately, reduce cost, and
improve customer service.
The basic strategy of CRM is the adoption of customer-centric organizational approach where
the customers are separated into different segments, and each segment is tailored using certain
behaviours and patterns, and with the coordination of banks various department improve the
customer service and effectiveness. The marketing environment is changing from mass
marketing to target marketing and in the future it move towards individual or personalized
marketing.

Ingredients for Successful CRM:

For all the noise generated about CRM, its easy to lose sight of one simple fact: CRM can
enhance a banks profitability.
The banking community knows that CRM is more than a computer system or an approach to
serving customers. Its a business strategy that places equal emphasis on sales and service. In
this light, CRM enables the bank to increase the value of its advice and service by effectively
using its customer information.
Banks, of course, have been using customer information to enhance customer sales and service
for a long time. What is different today is that powerful tools now exist to help banks mine the
real gold in their customer information.
Successful community banks know their customers habits, the types of services they use, where
they live and work, and can quickly identify their profitable customers. If your bank wants to be
more successful, it needs to ask three questions on a regular basis:
What do you know about your customers?
What do you need to know about your customers?
What is the profile of your profitable customers?
The result of this research will be important information that can be stored and accessed through

any customer-focused core system. If your staff knows where to look, they can call up a
customer profile and see the customers product gaps.
To take maximum advantage of customer information requires your bank to cleanse its data
making the names and addresses consistent, making sure that customer birth dates have been
entered. The resulting consistent body of information is critical to all CRM activities.
With clean, well-organized data, many relationship management tools exist to help model your
customer base and manage your prospects. To do this effectively, these tools must be fully
integrated with your banks core and electronic banking systems. Without integration, these
CRM tools really dont have much value.

Impacts of CRM on PUNJAB & BANK:

Some of the visible impacts of the CRM in Punjab & Sind bank are discussed in this section. The
impact of CRM on bank is positive and takes long time to value the impact. At the moment, the
impact is very wide in the organization. The CRM has changed the view, process, and techniques
of banking industry. But some studies say that the CRM has a negative impact on cost efficiency
of bank. Based on the my study Commercial Bank Industry reveals that CRM implementation
has a decline in cost efficiency, but at the same time it has a positive impact in profit efficiency.
As an impact of CRM implementation, bank understands the dual value creation which is
creating value for them by creating value for their customers. One of the greatest impact of CRM
in this bank is the realization of effectiveness impact rather that efficiency impact, which means
effectiveness of bank service is increased with high cost.
The customer portfolio management (CPM) is an impact to banking business. As part of CPM,
banks segmented markets, costing done based on activities, estimated the life time value of
customers, and data mined to realize the strategically significant customers. Another main impact
is on the customer relationship management and customer experience. The CRM creates a single
window product details which enabled the employees to perform efficiently. It increases the
speed of transaction and solving the customer queries. As an impact of operational CRM, the
banks sales-force, marketing, and services are automated. Because of operational CRM, the cost
of operation is reduced with extended service hours which means customers can perform
transactions at home through online instead of going to bank without interacting with bank
employees. It helps the sales-force to offer the appropriate products to appropriate customers
without any complicated procedures.

Costs of CRM
The cost of CRM plays an important role in the success of CRM implementation and its effective
use. Improper funding is one of the reasons for the failure of CRM. Breakdowns cost into
hardware, software, customization, training, and support. It classifies the cost of CRM into the
following categories: software licenses, software maintenances, hardware, telecommunications,
system integrators, software vendor professional services, internal staff, and others.

Findings
1. Customer relationship management has become need of an hour without which it is difficult to
survive in the competitive market.
2. Customers in long-term relationships are more comfortable with the services, the organization,
methods and procedures. This helps reduce operating cost and costs arising out.
3. Educate more customers about the various banking services available and how to use them.
4. Bank has to ensure the security of ATM cards and credit cards etc.

Conclusion
This study strongly supports the fact that CRM is need of an hour and no business may be it is
banking business; retailing or something else can ever survive without proper introduction of
CRM. This study strongly supports the connection that consumer were more satisfied with
professional service provider who engaged in both courteous expressions and personal
connections forms of sociality. Moreover, finding revealed that regardless of services context
customers expect service provider to be courteous usually ,most conversation begin or end with a
courtesy expression and includes some form of personal connection content. The important point
is that sociality communication can play a pivotal role in moving the provider and consumer for
mere encounters to higher degree of relational development.

Questionnaire with an employee:

1.
2.
3.
4.

How CRM came into the picture at PUNJAB & SIND Bank.
What was the need that bank felt to start up with the CRM.
Can you just brief us regarding CRM process of PUNJAB & SIND Bank.
We know that PUNJAB & SIND Bank is the number one bank in India in customer
relationship management. What is PUNJAB & SIND doing different than other banks.

5. CRM is the activity done at various levels of the organization, how does PUNJAB &
SIND implement it.