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Final exam
Anatolii Peregudin
William Jessup University
June 2022
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Abstract
The set of tools for improving business processes in the modern world is constantly improving. A
few years ago, tools such as CRM, SCM and ERP had only a primitive set of functions and were
used only in large companies with large amounts of data, and today CRM, SCM and ERP are the
most important systems that contribute to automation and optimization for businesses of any size
and without these tools we simply cannot imagine our work. But what are the advantages of CRM,
SCM and ERP? How do these systems help modern business?
In this essay, we will analyze in detail the implementation of CRM, SCM and ERP in such a
highly competitive field as marketing agencies and consider how, with the help of CRM, SCM and
ERP, a marketing agency can increase its profits and create competitive advantages.
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The situation in the US market
The field of marketing in the USA today is one of the most complex and highly competitive. This
is due to high inflation and rising prices for everyday goods, which is accompanied by
overproduction of goods, growing difficulties in their sale. This means that for a sustainable
functioning in the market, it is not enough for an enterprise, as before, just to work efficiently and
spend the same marketing budgets as before. The situation caused by the COVID-19 pandemic
requires a reduction in production and logistics costs, as well as an increase in sales.
The current situation in the market has once again emphasized that the fundamental goal of any
business is to find and create a consumer, focus on the interests, needs and preferences of the
target audience in various business niches.
Fundamentals of marketing in modern realities
Modern marketing assumes that the firm's efforts are focused on winning and maintaining the
competitiveness of products and services in both local and nationwide markets.
Nowadays, globalization is the main trend for all types of businesses, and marketing is no
exception. Globalization implies openness and high competition both within national economies
and in the global economic arena. The effective functioning of a marketing agency today involves
the implementation of foreign economic activity, the search for new buyers outside its area.
Already at the beginning of the XXI century, experienced marketers began to actively implement
the achievements of psychology in promotion strategies to study consumer behavior, for example,
when choosing a product among analogues, when making a purchase or when recommending a
product to friends and acquaintances. At about the same time, marketing agencies felt an acute
shortage of tools to measure customer satisfaction, to preserve the history of customer interactions,
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metrics for a deeper analysis of customer behavioral characteristics, as well as tools for optimizing
business processes.
Integrated strategies to create a competitive advantage
As I mentioned above, today the marketing business is faced with a number of challenges, such as:
1. Creating a competitive advantage to attract B2B customers. If earlier small marketing agencies
could only work in their area and attract customers using word of mouth, today these methods are
a thing of the past, because many young and ambitious startups with a more flexible pricing policy
have appeared on the local market, and in nationwide markets competition is so high that without
having a high place in all possible ratings and without having a significant competitive advantage,
it is simply impossible to count on attracting customers.
2. Creating a highly effective advertising strategy. Despite the fact that there is a well–known
phrase "advertising is the engine of trade", many companies in the current conditions are reducing
advertising budgets and choosing multifunctional agencies with a personalized approach to
customers for marketing.
3. Optimization of business processes. Working in a highly competitive field requires a high
quality of customer service and the ability to adjust the initially adopted strategy to increase its
effectiveness. Only the optimization of business processes will allow you to retain existing
customers, while maintaining the pricing policy, and attract new ones.
To solve these problems, the implementation of CRM, SCM and ERP systems is perfect. Let's
look at examples of how the introduction of these systems will contribute to a marketing agency in
creating a competitive advantage and help solve a number of main tasks.
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CRM system implementation
CRM system is one of the most important tools for sales departments today. With the help of a
CRM system, sales departments strengthen customer relationships and optimize work processes as
much as possible. A study by the international consulting company Capterra showed that after the
introduction of CRM, the productivity of sales managers increases by 37%, the sales level
increases by 29%, and the company's profit increases by 25-35%, and an important result of the
study was that 87% of the study participants emphasized that CRM systems significantly
contribute to customer retention and satisfaction clients1.
But how exactly will CRM software help a marketing agency build long-term relationships with
customers and create a competitive advantage?
As we know from the textbook materials, CRM helps to store and systematize data about
customers, applications and transactions, i.e. track the history of interactions with the client. In
CRM systems, all customer information is collected in convenient cards: names, contacts,
purchases, contracts, invoices and payments. The entire history of work with the customer, letters
and call records are stored here in chronological order. In addition, the system automates processes
and helps the manager at every stage of the sale: reminds him to call the customer, forms
documents according to a template, issues invoice, creates analytical reports, sends a text message,
sets tasks and monitors their implementation.
It is also worth noting that the CRM software will allow the marketing agency to reduce additional
costs associated with physical databases and maintenance costs, since the CRM uses a cloud
server, which allows employees to have the fastest possible access to all databases, see all changes
made in real time, and also ensure sharing the necessary applications for employees 2.
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Summing up, we can say that the introduction of a CRM system will allow a marketing agency to
optimize business processes for the sales department, build a personalized dialogue with the client,
and also provide managers with all customer information in the shortest possible time.
Implementation of the ERP system
But if the work of the sales department of a marketing agency can be optimized using a CRM
system, then what tools can help improve the efficiency of the development department and how,
in principle, to synchronize work in all departments of the company? It is this task that the
implementation of an ERP system solves.
The abbreviation ERP stands for Enterprise Resource Planning and implies the storage, processing
and maintenance of a single company database. With the help of ERP software, a marketing
agency will be able to synchronize the activities of all departments: sales department, development
department, customer service department, media department and administrative department.
The main advantage of the ERP system is the ability to keep all resources under control in a single
information space and turn individual divisions of a marketing agency into a single effective
mechanism available to each employee involved in the project.
Here are some statistics. According to a study by an international educational organization
specializing in the field of production operational management APICS, the introduction of ERP
helps to reduce unforeseen costs by 8% during project development, reduce order execution times
by 30% and increase the volume of products by 15% (increase the efficiency of services rendered)
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Implementation of the SCM system
An important factor for the successful development of a marketing agency is the introduction of
SCM systems. This is due to the fact that ERP systems help to turn individual divisions of a
marketing agency into a single effective mechanism, CRM systems are necessary to build longterm relationships with existing and potential customers already listed in the database, and to
attract new customers and develop the most effective marketing strategies, a marketing project will
require the introduction of a SCM system.
Supply Chain Management (SCM) is one of the most important tools for successful business
development. This is due to the fact that the SCM system focuses on matching the product supply
with consumer demand and offers several concepts and models based on the information received4.
The main properties of the SCM system that are necessary to create highly effective marketing
strategies are:
1. Analytical reports on the demand for a particular product;
2. Segmentation of consumers based on the needs of the target audience in services;
3. Analysis of consumer demand;
4. Monitoring the market situation and developing planning based on the information received;
5. Development of supply chain strategies.
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When implementing SCM software, a marketing agency can collect, process, store and analyze
data on demand, changes in needs, and individual customer needs. Based on this information,
marketers receive a tool for the most accurate forecasting of demand for a customer's product or
service, building the most effective marketing strategy.
Conclusion
The development of a marketing agency today involves the development of highly effective
marketing strategies, continuous improvement of the quality of communications with customers,
as well as the creation of a competitive advantage. All these tasks can be solved by introducing
proven and effective tools into the business, such as CRM, SCM and ERP systems. Thanks to the
advantages of these software, a marketing agency will not only be able to increase the level of
communication with customers, unite working units, attract new customers and optimize business
processes, but also provide the most effective marketing for its customers. Transparency in reports,
availability of information, cohesion of all members of the working team and the effectiveness of
the marketing strategy will provide the clients of the advertising agency with a pleasant experience
and increase the ROI of clients, which will become a competitive offer of the marketing agency.
References:
1. “CRM Industry User Research Report”, Katie Hollar, July 15 2015,
https://www.capterra.com/customer-relationship-management-software/user-research
2. “Customer relationship Management”, V. Kumar, Werner Reinartz, p. 397
3. “Operations Management Body of Knowledge Framework”, APICS, p. 51
4. “Addressing Skills Mismatch: Utilizing Talent Supply Chain Management to Enhance
Collaboration Between Companies and Talent Suppliers”, Erin E. Makarius and Mahesh
Srinivasan, hbr.org
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