Performance Monitoring of CRM Initiatives

Since the late 1990s CRM has become a buzzword especially among business practitioners and consultants. Companies have invested or are planning to invest huge amounts to implement CRM strategies, tools and infrastructure in order to attract and retain profitable customers in today's increasingly competitive markets. However, the existing academic literature and the practical applications of CRM do not provide definite guidance how to assess the profitability of CRM projects. What is also missing is a comprehensive measurement system that allows a holistic assessment of the ongoing contribution of CRM initiatives to the financial performance of the business firm. The purpose of this paper is to develop a framework for a systematic cost-benefit-assessment and for ongoing performance monitoring of CRM initiatives. Based on well-known methods and instruments for measuring business performance the authors propose an integrated approach to determine and measure the effectiveness and efficiency of CRM projects