Return on Investment (ROI) module in Customer Relationship Management (CRM): Research and Application

With focus of enterprise management extending from internal to external areas, its business operation strategy has gradually shifted from concentration on "products" to "customers". Effectively implementing Customer Relationship Management (CRM) system has become the key to the success of enterprises. Much resource has been spent to build the CRM systems. However, presently, there is no systematic and effective method to quantify CRM's "return on investment (ROI)". It is imperative that enterprise management needs such methods or systems in place to estimate and predict the contribution of CRM to the increase of customers, the expansion of market share, and its rates of return on investment. In this paper, we examine costs of CRM - comprising costs for construction and usage. We examine the rate of Return On Investment (ROI) considering both direct and indirect factors. The ROI model is then constructed by availing the non-discount method, and then improved by taking into account factors of depreciation and income tax. This improved model is tested with MT (Shanghai) Company Ltd. It is found to be useful and corresponds well to reality.