The Challenge - To develop client relationships as a way to retain valuable customers
The Solution - Design and implementation of state-of-the-art CRM and ‘eCRM’ technology
The Benefit - Lufthansa now presents a single face to the customer, facilitating innovation in products and services
The liberalisation and deregulation of the air transport market have transformed the industry's organisational framework. Competition has increased, and so has market and price transparency. These changes benefit the customer, but they impose new challenges on airlines, which are reinforced by developments and trends in the industry.
Airlines have been forced to develop new strategies to achieve differentiation and competitive advantages. But they have found that quality in-flight schedules, in-flight service or cabin standards are not enough to achieve strategic differentiation. Besides, competitors can easily imitate product quality.
Long-term differentiation to develop competitive advantages can only be realised by improving personalised customer relations to increase the loyalty of the airline's most valuable clientele.
The improvement and individualisation of services relies on understanding an airline's customers, their needs and expectations. Therefore, it's essential to gather and analyse customer data, and to make it available at the various customer contact points along the service chain. The availability of topical and consistent information builds the base to identify customers according to their individual value, to treat them in a differentiated way, and to individually address customers with products and services.
Due to the range and diversity of existing information, a powerful and superior technology is required to provide easy access to all relevant information for employees wherever they interact with customers. Lufthansa realised that its Information Technology (IT) architecture did not allow for universal access to all information, and decided to replace its infrastructure with a simpler but highly efficient IT architecture for customer information management.
Lufthansa worked with a recently acquired business unit, now part of IBM Business Consulting Services, as its strategic partner and prime systems integrator to optimise the customer-related IT infrastructure.
The new target architecture is based upon six individual projects, each of which uses best-of-breed technology. The program provides for a consistent view of customer data, an integrated systems architecture, a modern call centre infrastructure, a central data warehouse and the PeopleSoft CRM software. A sixth project, incentive contract administration and furtherance, uses the above projects as technical basis.
CONNECT, the program's CRM front-end solution is designed to provide all customer touchpoints with the data necessary for a comprehensive and individual sales pitch; and to increase service quality in feedback management, sales force automation and contact management. The provision and use of customer data by the Lufthansa employee is facilitated through the introduction of PeopleSoft CRM 8.4 as integrated browser applications in the front- and back-office. The front-end supports customer relationship management processes. The back-end view envisions the design of the application and the underlying architecture.CONNECT supports a number of CRM processes and issues:
Sales Force Automation – Customer visits, market analyses, weekly/monthly assessments, resource planning, customer categorisation, distribution sales targets
Contact Management – Search and selection, correspondence, sales and marketing activity management, report generation and exporting data, administration of mailing items
PeopleSoft CRM 8.4 was chosen as the development platform after a meticulous selection process because it offered the most functional and technical solutions. The license model, the application's functionality and flexibility as well as the PeopleSoft commitment proved to be the best option for Lufthansa's CRM implementation. The implementation at Lufthansa is one of the first ever CRM 8.4 implementations. In addition, major customisations, made in the course of the Lufthansa implementation will be included in PeopleSoft CRM release 8.8.
CONNECT was initially set up in July 2000. Its implementation is currently proceeding. It is anticipated that the overall CRM Release 1.0, which includes further CRM IT projects besides CONNECT, will go live during the third quarter of 2003.
By presenting a single face to the customer, CONNECT has provided an integrated and friendly CRM solution that supports customer relationship management processes by making customer information including historic data available and visible to the end user.
The implementation of the new IT architecture is expected to effect significant cost reductions as well as the facilitation, of product and service innovations. In addition, improved metrics support the measurement of the program's other benefits.
For more information
To learn more about IBM Business Consulting Services, contact your IBM sales representative or IBM Business Partner, or visit us at ibm.com/services/bcs