The Advantages and Disadvantages of Relationship Management - Essay Example

ZEBRA COMPANY Creative Network Lancashire is small and medium sized enterprise based in Lancashire, England, who specialize in event management. Currently, the organization has to arrange ticketing for their local music festival events. Till date, they have successfully arranged ticketing for their shows through sales of wristbands. Then again, due to this, a significant cost had to be borne by the organization. This is particularly because they used to purchase wristbands in bulk from suppliers. Considering the fact that the organization has many upcoming events for which they need to arrange ticketing, network members of the company are now regarding purchasing wristband printers in order to make their own wristbands. The underlying objectives behind such a decision are to save costs on ticketing, provide a source of employment and hence, income for network members, offer a community or for-profit service for individual network members involved in organising additional events. In addition to that, the organization also plans to extend their operations to other communities who are engaged in similar activities. With such an underlying objective in their mind, the organization has approached us with an enquiry to purchase wristband printers in order to make their own wristbands and henceforth, bring down the costs of ticketing. Thus, this internal document will serve as a proposal highlighting the outlines of CNL as well as prospects of our company with regards to doing business with CNL. CNL is a small and local event management organization. They are yet to achieve a solid establishment and recognition. Considering that they are a newbie in this particular field, there are various problems associated with the organization. First and foremost, for a company who is not substantially established, pooling financial resources externally becomes a bit of a problem. This puts a limitation to the extent to which they can conduct their operations flexibly. Staff recruitment is another problem that they frequently face. More often than not, personnel work on a temporary basis in such companies and leave without a notice in search of better opportunities. This disrupts the company’s flow of operations and also, deteriorates the quality of service that they provide. The key to organize a successful event is to allocate the right resources with the appropriate skills. Companies like, CNL, do not possess a precise knowhow of efficient resource allocation. This often leads the company to incur much more costs than that is anticipated. They lack experienced event managers and as a consequence, fail to keep track of changes in the scope of events. In addition to that, they tend to deviate from the standard established in the field of event management. Such companies lack innovation and thus, render inefficient services, which ultimately backfires at the company itself. Considering the fact that CNL has upcoming events lined up, they need cost effective means of ticketing. This is primarily because the ticketing arrangement that they have used till date has slashed their company profits significantly. This is where Zebra steps in by providing CNL with cost effective means of ticketing in form of wristband printers, thereby helping the company to lower the cost that they incurred while purchasing wristbands from external suppliers. Small and medium sized enterprises are always associated with certain degree of uncertainties. As far as event management organizations are concerned, one of the primary uncertainties associated with them is achieving a consistent target market through which they can line up a number of events for future. Moreover, events, such as, music festivals, are successful only if tickets are completely sold. Here lies another uncertainty as to whether all the tickets will be sold or not. The selling of tickets depends largely on the reputation of the organization, arranging the event. So, for a locally based organization such as, CNL, selling all tickets is a big uncertainty. A newbie company always strives for recognition, which is why CNL is motivated towards establishing a solid foundation. Their ability lies in their integrity to provide superior quality services to their clients. Besides that, such companies have the ability to formulate effective relationship marketing and sales strategy in order to attract a wider target segment and build long-term relationship with their customers. Supply and partnering opportunities Zebra technologies can accrue significant benefits if their partnership, in terms of doing business with CNL, goes through. CNL has enquired our company for supplying them with wristband printers in bulk in order for them to be able to make their own wristbands, instead of purchasing them externally. They have tendered a request for 35 wristband printers, along with additional services. Zebra technology is in a good position to negotiate the terms and conditions of this deal, in terms of pricing the product as well as services to be provided along with. Partnering with CNL will also serve as a good platform which can be utilized by our company to market our product in an efficient way (Lewin and Johnston, 1996). Moreover, wristband printer is a relatively new product in the market and supplying it to novice organization will help us to understand the areas of improvement, to be brought about, in the device and henceforth, can be sold in larger scale to bigger organizations (Arias and Acebron, 2001). In addition to that, Zebra technologies can utilize the platform in order to promote its products to bigger organizations that can benefit from using the wristband monitor. In this way, the company will be able to build a strong network of clients which will help to attain a wider customer base. Organisation’s problem-solving ability Zebra technologies can prove to be very efficient as far as dealing with the current problem is concerned. The current issue that CNL faces is regarding the arrangement of ticketing for its upcoming event. The wristband printer that we provide can print 50 tickets in a minute and naturally, 3000 tickets in an hour. Therefore, CNL can reduce the time that it takes to print the tickets and can devote the additional time towards selling those tickets. The tickets that are printed through wristband printers come with the radio frequency identification feature which solves the security issue that concerns CNL. This will help the company to cut costs, in terms of recruiting a security official who had to check the clearance of each and every ticket holder manually. The RFID tickets come with bar codes which are scanned and then, the ticket holder is cleared to participate in the event accordingly. Hence, the company can contribute significantly towards addressing the current problem. Network potential Zebra technologies can use the network of CNL in order to establish contacts with other event management organizations that are associated with CNL, in a way or the other. Moreover, Zebra technologies can also market and promote its products to individual network members who organize events independently. This will serve as a strong platform to enable Zebra technologies to expand its operations into new locations, thereby building a strong network of clients through the existing network members of Creative Network Lancashire. Product offering The product offering can be best explained through a single timeframe, depicting each and every stage involved in offering the product. Activity Time period Tendering quotation 2 weeks Approval of quotation 2 weeks Accumulating resources/materials to be supplied 1 week Warehousing 1 week Supply 1 week Knowledge transfer and training 1 week The total time period required for taking the product offering through to its completion is eight weeks, i.e. 2 months. Risks and Implications This particular deal if approved will always entail certain risks to Zebra technologies. The company has to incur a certain degree of cost while supplying this product to CNL. The cost incurred by the company might be in form of transfer cost associated with shipping the products from the source to its destination. This is where the distance factor comes into being. If the distance to be covered, while shipping the products, is long, then the company will have to bear the cost, which might eventually reduce the profit that is expected to be generated. In this context, another risk that can be recognized is when the product turns out to be faulty. This will tarnish the reputation of Zebra technologies significantly, thereby reducing its chances of attaining potential future customers to build a strong network of clients. Relationship management implications Benefits Zebra technologies can establish a long-term relationship with CNL which means that they would get further opportunities of providing products and services to CNL (Ozgener and Iraz, 2006). Zebra technologies can build long-term relationship with the clients that they reach by utilizing the CNL network (Saarijarvi, Karjaluoto and Kuusela, 2013). The company can increase the customer retention rate through effective relationship management. Zebra technologies can also enhance its customer satisfaction level and influence customer buying decision by adopting effective relationship management strategy (Ndubisi, Nataraajan and Lai, 2014). Drawbacks The advantages of relationship management outnumber the disadvantages associated with it. The disadvantages associated with relationship management are: If the relationship management strategy is not efficient, then that may hamper the reputation of Zebra technologies, thereby leading the company to lose potential clients (Miquel-Romero, Caplliure-Giner and Adame-Sánchez, 2013). Formulation of relationship management strategy and relationship marketing entails certain costs which might cut down the profit of Zebra technologies by a certain margin. Reference List Arias, J. T. G and Acebron, L. B., 2001. Postmodern approaches in business-to-business marketing and marketing research Journal of Business & Industrial Marketing, 16(1), pp. 7-20. Lewin, J. E. and Johnston, W. J., 1996. Business and industrial marketing: past, present and future Journal of Business & Industrial Marketing, 11(1), pp. 7-16. Miquel-Romero, M. J., Caplliure-Giner, E. M. and Adame-Sánchez, C., 2013. Relationship marketing management: Its importance in private label extension. Journal of Business Research, pp. 1-6. Ndubisi, N. O., Nataraajan, R. and Lai, R., 2014. Customer perception and response to ethical norms in legal services marketing. Journal of Business Research, 67, pp. 369-377. Ozgener, S., and Iraz, R., 2006. Customer relationship management in small-medium enterprises: the case of Turkish tourism industry. Tourism Management, 27(6), pp.1356-1363. Saarijarvi, H., Karjaluoto, H. and Kuusela, H., 2013. Customer relationship management: the evolving role of customer data. Marketing Intelligence & Planning, 31(6), pp. 584-600. Read More