Chapter 04 – Strategic Customer Management: Systems, Ethics, and Social Responsibility
Chapter 04
Strategic Customer Management: Systems, Ethics, and Social Responsibility
1. The metric customer lifetime value incorporates the past profit produced by the customer in
its calculation.
2. The company-wide level of CRM offers a single view of the customer across all of the
organization’s access channels to the customer.
3. In the value creation process, the benefits the customer receives are expressed by the
customer strategy.
4. The integration of CRM into the firm’s operational support systems is important for the
successful implementation of CRM.
5. In order to successfully apply CRM, a firm should first create a customer strategy before
implementing CRM.
6. Investing in building relationships with disinterested customers is a major initiative of
CRM.
7. The sum of CLV for all the customers of a firm is termed as business case.
8. CRM approaches do not identify less attractive customers.
Chapter 04 – Strategic Customer Management: Systems, Ethics, and Social Responsibility
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9. If a firm is essentially defensive in its stance on social responsiveness, then its primary
concerns will be the protection of relationships.
10. Companies that have embedded CSR in their strategy usually take a defensive stance in
their response to social responsibility.
11. _____ is a cross-functional core business process that is specifically concerned with
achieving improved shareholder value through the development of effective affiliations with
key customers and customer segments.
A. Benchmarking
B. Customer equity
C. Customer relationship management
D. Customer value proposition
12. CRM supports a customer-responsive strategy, which gains competitive advantage when
it:
A. demonstrates the customer’s trustworthiness and reliability to the company.
B. delivers superior customer value by personalizing the interaction between the customer and
the company.
C. tightens connections with the competitors.
D. achieves the coordination of customer capabilities around the organization.
13. Which of the following information should be present in a database created by CRM
technology?
A. Channels of distribution
B. Company contacts with its distributors
C. Response to marketing stimuli
D. Information on supplier quality
14. Which of the following levels of CRM is concerned with coordinating information across
Chapter 04 – Strategic Customer Management: Systems, Ethics, and Social Responsibility
all contact channels on a continuing basis?
A. Field level
B. Company-wide level
C. Functional level
D. Customer-facing level
15. Which of the following CRM levels provides a strategic focus for CRM?
A. Field level
B. Company-wide level
C. Functional level
D. Customer-facing level
16. Which of the following is the first step of developing a CRM strategy?
A. Form a cross-functional CRM project team for decision analysis and actions.
B. Gain an organization-wide commitment to CRM strategy.
C. Conduct a business needs analysis concerning customer relationships.
D. Develop and define the CRM strategy to guide management process.
17. The _____ level of CRM considers the implications of knowledge about customers and
their preferences across the entire organization.
A. field
B. customer-facing
C. company-wide
D. functional
18. The _____ perspective of CRM considers the processes that are needed to fulfill required
marketing activities.
A. functional
B. field
C. company-wide
D. customer-facing
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19. The _____ in a CRM strategy is an assessment that indicates the shareholder value and
financial return of delivery of the required customer value.
A. operating agreement
B. enterprise transformation plan
C. value proposition
D. business case
20. The _____ in the CRM strategy spells out what the organization must provide in order to
satisfy customer expectations.
A. value proposition
B. enterprise transformation plan
C. operating agreement
D. business case
21. The _____ in the CRM strategy indicates the necessary initiatives to launch the strategy.
A. value proposition
B. enterprise transformation plan
C. operating agreement
D. business case
22. The _____ component in the CRM strategy indicates how different consumer segments
will be formed and managed.
A. business case
B. value proposition
C. customer strategy
D. enterprise transformation plan
23. Which of the following is the final step in developing a CRM strategy?
A. Gaining an organization-wide commitment to CRM strategy
B. Forming a cross-functional CRM project team for decision analysis and actions
C. Developing and defining the CRM strategy to guide management process
D. Conducting a business needs analysis concerning customer relationships
Chapter 04 – Strategic Customer Management: Systems, Ethics, and Social Responsibility
24. Which of the following is a pitfall to be avoided when applying CRM initiatives?
A. Changing the organization before putting CRM in place
B. Matching CRM technology to the customer strategy
C. Investing in building relationships with customers who value them
D. Implementing CRM before creating a customer strategy
25. Which of the following is a pitfall to be avoided when implementing CRM initiatives?
A. Creating a customer strategy before implementing CRM
B. Putting CRM in place before changing the organization to match
C. Matching the technology to the customer strategy
D. Investing in building relationships with interested customers
26. _____ has to be avoided when implementing CRM initiatives.
A. Creating a customer strategy before implementing CRM
B. Changing the organization before putting CRM in place
C. Assuming that more CRM technology is necessarily better
D. Investing in building relationships with interested customers
27. Which of the following activities hinders the successful implementation of CRM
initiatives?
A. Creating a customer strategy before implementing CRM
B. Changing the organization before putting CRM in place
C. Matching the technology to the customer strategy
D. Investing in building relationships with disinterested customers
28. In CRM, the benefits the customer receives are expressed by the _____.
A. value proposition
B. customer equity
C. customer lifetime value
Chapter 04 – Strategic Customer Management: Systems, Ethics, and Social Responsibility
D. enterprise transformation plan
29. _____ refers to the sum of CLV for all of a firm’s customers.
A. Customer zone
B. Customer orientation
C. Customer concentration
D. Customer equity
30. The goal in _____ CSR mode is to anticipate and develop appropriate responses to social
demands from any source that threatens to undermine the value and credibility of brands, the
attractiveness of the competitive position on which the company’s strategy depends, and the
viability of the marketing strategy itself.
A. defensive
B. strategic
C. systemic
D. charitable
31. How does CRM help gain a competitive advantage through a customer-responsive
strategy?
32. What information should a database created through CRM technology contain?
Chapter 04 – Strategic Customer Management: Systems, Ethics, and Social Responsibility
33. What is customer lifetime value? How is it calculated?
34. What are the different CRM levels?
35. What are the major steps in developing a CRM strategy?