o Cooperative Bank of Oromia (CBO)Cooperative Bank of Oromia commenced banking operations in 2005, focusing on cooperatives and agro-based businesses in Ethiopia. Headquartered in Addis Ababa, the bank operates in more than 289 branches and employs 3,138 agents across the country. Its Revenue is: ETB 1.08 billion (2016), Net income: ETB 39.12 million (2016) and Total assets: ETB 10.69 billion (2016) (www.coopbankoromia.com).1.1.2 CRM and Banking IndustryCRM includes Comprehensive strategies and Processes of acquiring, retaining and partnering with selective Customers to create superior value for Company and Customer.
Customer Relation Management (CRM) is a customer focused and soft ware based Business strategy to handling customer relationships. The overall aim of CRM systems are togather data about customer relationships with the organization (Nguyen,Sherif, Newby.2007).An integrated CRM system in banking industry may have the following features:- A central data base accessible to all employees to view and update customer data. Customer data analysis including segmentation of customers and potential Customers Customer self-service Such as ATM which can be used by the customer for self ordering and self help by using web based password protected access.
Identifying and tracking potential customers Generation of reports with up to date information including revenue forecasting and trend analysis. After the free market economic policy many private bank and private insurance company are established in anticipation of a law which will encourage the private investors to participate in financial sectors. In the Banking industry, CRM is a vital factor to improve the performance of the banks for example Commercial Bank of Ethiopia is the first to use ATM.In order to excel in their services, the present day banks have shifted their focus from the twin functions of accepting of deposits and lending of loans to anytime and Anywhere Banking. Customers are considered as the fundamental non-core financial asset by the banks across the globe in the present day scenario. Customer relationship management helps businesses use technology and human resources to gain insight into the behavior of customers and the value of those customers. A highly satisfied customer will market for the bank and bring in more new customers to increase the business of the banks. This would help the banks to serve the customers in the with utmost cost efficiency. This will lead the banks towards customer satisfaction and customer loyalty. Example of CRM, the CBE introduced finger print banking to allow customers to transact using their finger prints instead of passwords and Awash bank’s priority Customers are provided a dedicated priority relationship manager to service their personal banking and investment needs.1.1.3 CRM Benefits for Banks in Increasing Customer Retention Here are some ways describing how a CRM system Can help Banks with that:- CRM helps provide a great customer service experienceWhen a CRM system is integrated throughout a company, it allows all departments to use the same software and see the same data. This can help streamline operations, and especially provide better customer service.Rather than a customer is passed from one individual or department to the next in an attempt to understand and resolve a problem, all departments will have quick access to the same data. This allows the company to offer a faster, more effective response to a customer’s questions and concerns. Not only can this improve customer retention, but will improve the company’s reputation overall, potentially leading to new customers Reduces acquisition Cost Understand and identify profitable customer accounts-Analytics gathered from CRM system helps organizations to identify the key accounts that are responsible for the most revenue CRM helps find the right Services for different customersBy interacting with the customers and collecting data, a CRM can provide information about their buying patterns and wants or needs. By storing this data, the system can help increase sales by allowing a company to offer premium products in the same category as a recent purchase. The system can encourage cross-selling by analyzing previous purchases and suggesting complementary products. Enhance Internal Communication Upgrade and Offering better Customer Service Feed Back services Make Call Centers more efficient Increase Customer revenues Increase Efficiency Employees have more time to serve customers. Helps Sales Staff Close deals faster Simplify marketing and Sales process discover new Customers Maximize Cross sell/Up Sell products more effectively Simplify marketing and sales processes Promotion Of Campaign and assisting the marketing department Retaining existing customers and finding new Customers Providing Products and Service that exactly match customer requirementsCRM has also lowering Operating Costs; growth in the number of customers and focus on external customers for customer is the life bloods any business in this digital world.