Question
The South African tele communications industry has been one of the fastest growing sectors in the last few years. Stiff and fierce industry competition has
The South African tele communications industry has been one of the fastest growing sectors in the last few years. Stiff and fierce industry competition has resulted in the network service providers offering similar services and ultimately facing market saturation. Customer relationship management (CRM) dimensions were explored as key drivers for organisational strategy to retain and grow the market share, revenue growth and to create a competitive advantage through service innovation. The research study followed a mixed methods approach which consisted of the administration of 180 online surveys distributed through various social media platforms such as Facebook. LinkedIn and WhatsApp. followed by nine unstructured telecommunication expert interviews. which were ultimately changed to virtual meetings using Microsoft teams to conduct the balance of interviews due to the worldwide COVID-19 pandemic regulations which imposed social distancing as a preventative measure to combat the spread of the virus. Both quantitative and qualitative data collected were analysed using different data analysis methods, such as statistical measurements and themes respectively The study concluded that there is no relationship between CRM systems and mobile service innovativeness in the South African telecommunication industry from a customer point of view, whereas there was a general consensus among all three network service providers interviewees (Vodacom, MTN and Telkom) that CRM assists with customer knowledge data and provides the market insight that enables management to extract information that is used as inputs for new innovative consumer mobile services development. Several recommendations were made and specific guidelines for future research were highlighted.
1.1
Purpose of the study
The focus of this research study is to determine the extent to which customer relationship management (CRM) determines consumer mobile services innovativeness in the South African telecommunications industry. Prior studies suggest that CRM contributes to the organisational performance, can assist in operational cost reduction, and contributes to revenue growth due to increased long-term customer satisfaction and loyalty, thus enabling the firm to maintain the market share position ((Kanaman, Ferdous & Rahman, 2011; Khalign, Miremadi and AminIlari, 2012; Long et al, 2013). CKN is used as a tool to capture customer information for management to analyse, manipulate and translate customer data to assist in making business decisions (ernst et al, 2011). CRM is also regarded as an effective tool for managing existing products. However, there seems to be limited studies that have sought to determine how CRM can effectively extend its functionalities towards Innovativeness in the service Industry.
Organisations have come to realise that customer information enables them to track user needs and customer behaviour, allows customers to share service experiences which assists them to effectively manage customer relationships (Ghafari, Karjalian & Mashayekhnia, 2011; Rahaman & Ferdous;
Monammad ImtiazKahman, 2011; Koberts-Lombard & du PlessIs, 2012; Hadi, 2015).A high-valued service is created through systematic customer interaction which assists the organisation to create customer loyalty and retain customers for repeat purchases (Witell et al., 2016). In light of the contributions of KM to innovativeness in the production of tangible products (Su, Chen & Sha, 2006; Ernst et al., 2011; Khodakarami & Chan, 2014) and that there are limited studies that explored the relationship between CKM and service innovation in the services industry (Agraval & Berg, ZUUS (Agraval& Berg, 2009); Clatworthy, 2011), this study seeks to determine the extent to which CRM promotes consumer mobile service innovativeness in the South African telecommunications industry. The research study purpose is to raise insights that may be valuable in promoting innovativeness in the entire serviceindustry.
1.2
Context of the study
The study will be conducted in the following specific contexts:
First, the research study was conducted in the context of the telecommunications industry. The success of the service industries depends on the extent to which organisations can respond to the changing competitive environment. This is attained by constantly adopting new technologies that enable marketers to become innovative in their respective sectors by developing products and service offerings (Ghatari. Karialian & Mashavekhnia. 2011). Since the inception of the telecommunication industry. the industry has witnessed rapid industry growth due to the market demand for mobile services such as voice, data and other consumer-based value-added services. The latest report provided by the Independent Communications Authority of South Africa (ICASA) indicates that telecommunication services revenue growth has increased by 14.4% from R163 billion to R187 billion in the year ending 2018 (ICASA, 2019). The mobile data revenue increased by 9% in the last year, of which over a four-year period, the mobile data increased by 16% (ICASA, 2019). The report gives a signal to the growing consumer market in telecommunications services.
Secondly, the research study was conducted in the context of South Africa with a specific focus on Johannesburg as the economic hub of South Africa (Rogerson & Rogerson, 2015).
Thirdly, the research study involved customers and managers of telecommunications companies collecting quantitative and qualitative data respectively, and thus, the study was approached from the stakeholder's perspective. Previous studies have discovered that user involvement during tangible product development has provided a valuable contribution towards product development. even in instances where user involvement had turned out to be dreadful (Magnusson. Matthina & Kristensson. 2003)
LITERATURE REVIEW
1.3 Introduction
This study focuses on CRM as a determinant of mobile service innovativeness in the telecommunication industry in South Africa. CRM is an important component of consumer behaviour and is an aspect of marketing. The ever-evolving telecommunications environment has presented the service industry with endless unpredictable customer demands for unique and differentiated services aimed at meeting customer's needs. According to Jones and Hill (ZUTU, p. 145), customer needs are desires, wants or cravings satisfied by means of attributes or characteristics of a product (good or service). They further highlight that two factors determine which products customers choose to satisfy their needs: product differentiation and pricing. Companies that channel their resources towards developing unique offerings will be able to attract new customers and retain existing customers for as long as customers realise value in product and service consumption.
As technology evolves, so do the customers' needs, demanding more cutting-edge innovative services. (Ghafari, Karjalian and Mashayekhnia, 2011) and Osei & Owusu (2015) stated that organisations cannot survive without adjusting to the external environment, creating new ideas and commercializing them. They further stated that for the organisation to survive the volatile competitive market it will depend on the company's ability to innovate to keep abreast of competitors.
The need for an organisation to deploy CRM tools has to be a strategic decision for the organisation to have a sense of the market intelligence to understand how its services are being consumed, the consumption frequency and by which market segment. This compels the organisation to systematically record customer consumption and buyer behaviour. The customer relationship management (CRMI system in an organisation does not only assist in retaining the customers. but it also encourages an organisation tooffer customers valuable recommendations and suggestions. ORM IS recognised as a gateway for improving innovation capabilities, obtaining competitive advantages in the market and to assist in optimising the organisation's performance in an effective and efficient wav. CRM is not only used by service providers (SP) to gain a competitive advantage but is also utilised to assist in creating the management of customer relationships. which affects customer retention through built in customer incentive programmes. thus creating a competitive advantage. The further state that CRM has a built- in client contact management system which tracks historical interaction with customers to avoid sales efforts duplication, assists with sales forecasting, order management and product management.
The literature review explored and examined previous studies that have sought to identify CRM as an organisation enabler capable of storing customer information, such as product and service demand, historical records, customer buying patterns or purchasing frequency and sales trend analysis as a
method of helping management to understand customer behaviour Such information is said to provide management with client specific data that can he analysed and interrogated for future service design anddevelonment within the South African telecommunications industry. Tovese (2014) and Had
(2015) agreethatit is a technology-enabled strategy to convert data into action in response to customer behaviour.
1.4 service innovation Theory
The theoretical framework underpinning the study is Innovation theory. Lusch and Nambisan (2015) and Osei & Owusu (2015) stated that organisations have revolutionised how they view innovation processes by redesigning their business strategies to become inclusive of all involved stakeholders having a direct and indirect influence on the organisation's value creation ecosystem. The innovation evolution has shifted from traditionally offering tangible products to providing intangible services. which require extensive market-based information. Seeminglv the shift from feature-based attributes to value creation relates to service experience. The pointed out that the evolution of service offerings has challenged the competitive service markets by demanding the use of information technology to enable the technical and economic aspects of innovation in creating a commercial opportunity. As opposed to the tangible productsproductionprocess, which is labour intensive and ultimately distributes the goods to the variouschannelswhere customers can reach them, a service-driven organisation requires an exchange o services where the organisation deploys its skills and expertise combined with organisational capabilities' to serve its market. barrett et al. (2015) mentioned taht theorists differ in opinions in terms or making a distinction between a product and a service. However, they view a product as having to require a service meaning the two can be inclusively consumed, whereas a service is based on the intangible nature of it, such as cloud services as opposed to selling computer hardware
1.5 South African Service Industry
The South African service industry is no different to other global service industries in terms of industry competitiveness (Ackerman & Ravestevn 2006: Roberts-Lombard 2011). Thakur and Hale (2012) statedthatthe service industry competition has intensified global in both developed countries such as the USanddeveloping markets such as India, compelling organisations to seek survival strategies by becominginnovativein their service offerings. YuShena & Ibrahim (2018) mentioned that to compete in the serviceindustry requires the organisation to be different in service offerings, as it is difficult to compete in core products and services which demand organisations to develop unique and differentiated solutions to have competitive advantage
The report provided by Stats SA (2019) stated that the financial sector is the biggest contributor to SouthAfrica's GDP. Ackerman and Ravesteyn (2006) identified that customers in the banking sector are consuming services of high technology and of a long-term financial commitment that are risky in their nature. Therefore, it calls for the financial service provider to have a close mutual relationship with customers to allow information flow. They further state that financial services are usually similar in their offerings, which makes it rather challenging for customers to differentiate services from other competingservice provider's offerings. Service providers can differentiate their service offerings by becoming customer-centric organisations in nurturing relationships with their customers to achieve a competitive advantage.
Question
The literature review above does not contain a list of key words / key phrases. Suggest five (5) key words / key phrases that should have been listed for this literature review.
Explain the reason for the use of key words / key phrases in a literature review? Provide five (5) reasons in your answer.
- Five (5) key words / key phrases 2 marks each = 10 marks
Explanation for the use of key words / key phrases - 5 reasons x 2 marks per reason = 10 marks
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