A Critical Analysis Of The Impact Of CRM On Higher Education In . - IJLT
International Journal of Learning and Teaching Vol. 3, No. 4, December 2017A Critical Analysis of the Impact of CRM onHigher Education in MauritiusRandhir Roopchund LecturerAberystwyth University (Mauritius Branch Campus), Quartier Militaire, MauritiusEmail: rar11@aber.ac.ukWith such a massive growth there is a general debate atthe national level about the quality of education beingdelivered [3]. In addition, students are bewildered by thevast array of courses being offered. Students are also lostduring the whole student lifecycle. CustomerRelationship Management has always been applied in themanufacturing/retail sectors. However, with the growingimportance of the services sector in the Mauritianeconomy; an effective study of the possibility ofimplementing CRM in public sector should be considered.Abstract—This research paper seeks to understand theimpact of CRM on Higher Education in Mauritius.Mauritius has the ambition of becoming an educational huband the need for improving relationships with students hasbecome quintessential. The methodology of the research isbased on a critical review of existing literature and alsobased on a survey carried out with students in PublicUniversities in Mauritius. The results are conclusive thatCRM has an impact on loyalty. Index Terms—customer relationship management, highereducation and mauritiusII.I.INTRODUCTIONA. Understanding CRMCustomer Relationship Management (CRM) is aleading new concept to business which has alreadybecome established in the literature [4]. CRM refers to ablishing and developing successful long termrelational exchanges [5]. A restricted view of CustomerRelationship Management would be database marketingfocusing on how promotional marketing is linked todatabase management tools. “CRM has been an ITenabled business strategy, the outcomes of whichoptimize profitability, revenue and customer satisfactionby organizing around customer segments fosteringcustomer-satisfying behavior and implementing acustomer-centric process” [6].CRM is a comprehensive approach for creating,maintaining and expanding customer relationship. Itprovides seamless co-ordination between customerservice, marketing, information technology and othercustomer related functions. It integrates people, processand technology to maximize relationships with all thecustomers.Customer Relationship Management is about creating,building and enhancing long term relationships withcustomers with a view to increase profitability [1] .Customer Relationship Management may be defined as astrategy to select and manage the most valuablerelationships. CRM has evolved over almost threedecades already [2].CRM has traditionally been applied by profit makingfirms with a view to increase profitability. However,CRM is also being applied by non-profit making firmsand NGOs due to the possibility of applying theprinciples with a view to increase customer retention andcustomer satisfaction. The major contribution of thepresent research would be to apply CRM in a HigherEducation environment. The literature review on HigherEducation shows tremendous potential of improvingstudent satisfaction through a structured approach ofcreating, developing and enhancing relationships withstudents. The innovation of the present research would beto identify the main variables that will form part of theCRM framework in Higher Education. Mauritius has ahigh enrolment at the tertiary level (42%). It seeks toachieve an enrolment rate of 70% by the year 2015. Thereare now four public Universities in Mauritius[3]with anoverall population of about 30,000 students which isexpected to increase constantly. The student populationhas increased in all the Public Universities. University ofMauritius itself has a student population of 13,000students both at Full-Time and Part-Time. UTM has astudent population of about 6000 trainees. The other twoUniversities are quite new namely the Open Universityand the Universitédes Mascareignes.B. Costsand Benefits of Customer RelationshipManagementCRM applications have the ability to deliverrepositories of customer data at a much smaller cost thanold network technologies [7]. Throughout an organization,CRM systems can accumulate, store, maintain, anddistribute customer knowledge. Peppard(2000) noted thateffective management of information has a veryimportant role to play in CRM because it can be used tofor product tailoring, service innovation; consolidateviews of customers, and for calculating customer lifetimevalue [8].Manuscript received February 20, 2017; revised May 18, 2017. 2017 International Journal of Learning and Teachingdoi: 10.18178/ijlt.3.4.300-304LITERATURE REVIEW300
International Journal of Learning and Teaching Vol. 3, No. 4, December 2017customer-oriented strategies have been increased amongthose universities willing to focus on satisfying the needsand preferences of their target markets/students toenhance their competitive positions. Most educationalinstitutions, as Kotler stated, have specific officesregarding marketing activities such as admissions, alumnior international offices and they even may employ someadvertising and public relations efforts. However, while itis true that they are doing some marketing activities, itdoes not mean that they are necessarily market-oriented(Kotler & Fox, 1995) [14].Scott (2000) believes that universities historically usedto be segregated institutions with a specialized vocation[15]. Scott addressed globalization as the most importantchallenge faced by universities in their history which hasbrought a fundamental shift in the organizationalcharacter of modern universities. This shift has beenmetaphorically addressed by [16] as a transition from“domesticated environment” before 1990s to a “wildenvironment”afterthistime [17]. Meanwhile,globalization has grown impacts on higher education justlike on any other sectors. According to [18], highereducation has always been more internationally open toglobalization than other sectors since it is the immersionin knowledge. The elements of globalization in highereducation are widespread and multifaceted: it has beenestimated that more than 1.6 million students studyoutside of their home countries, with more than 547,000studying in the USA [19]. The issues and implications ofthe global marketisation of higher education andprivatizationhave been discussed in the context of anumber of key concerns [20]; problems of increasingcompetition between institutions, nationally andinternationally, funding issues and widening participationor social segmentation [21]).As [22] explained students are becoming moreconscious of their customer rights and of gaps betweentheir expectations of service delivery and the reality ofthat service. For example, in 2003, Darlaston-Jones et al.noted that the Australian universities have undergone amajor transition in the past decade as they have movedfrom public to a greater emphasis on private funding, andre-invested themselves as business enterprises [22].Furthermore, students are viewing themselves asconsumers and are demanding value for money in theireducation.Higher education in Mauritius has a serious qualityproblem [23]. In current competitive academicenvironment students have many options available tothem. Therefore it is important to study factors thatenable education institutions to attract and retain students.Higher education institutions which want to gaincompetitive edge in future may need to begin searchingfor effective and creative ways to attract, retain and fosterstronger relationship with students. Therefore, it isnecessary to invest in CRM for improvement. Besides thegrowing trends of globalization, informationization–thedevelopment and expansion of information technology–resulted from the current information age, has created ahighly competitive and global environment forCRM systems assists companies evaluate customerloyalty and profitability based on repeat purchases, theamount spent, and longevity. Bull added CRM makes itpracticable for companies to find unprofitable customersthat other companies have abandoned. This position issupported by Galbreth and Rogersthat CRM helps abusiness organization to fully understand whichcustomers are worthwhile to acquire, which to keep,which have untapped potential, which are strategic, whichare important, profitable and which should be abandoned[9]. Customer Relationship Management an increase thetrue economic worth of business by improving the totallifetime value of the customer, adding that successfulCRM strategies encourage customers to buy moreproducts, stay loyal for longer periods and communicateeffectively with a company [9]. CRM can also ensurecustomer satisfaction through allocation, scheduling anddispatching the right people, with the right parts, at theright time [10].According to [11], companies can gain many benefitsfrom CRM implementation. He states that the benefits arecommonly found in one of these areas:i) Lower cost of recruiting Customersii) No need to acquire so many customers to preserve asteady volume of businessiii) Reduced cost of salesiv) Higher Customer Profitabilityv) Increased Customer retention & Loyaltyvi) Evaluation of customers ProfitabilityCurry and Kkolou (2004) refer to the major benefitsand reasons for adoption of CRM which include:customers from the competition will come prefer theorganization; a simplified, customer – focused internalorganization will simplify the infrastructure, shrinking thework flow and eliminating non-productive informationflow; and profits will increase from satisfied customerswhich will lead to more compact & focused company[12]. Like any other new function, CRM too has its owndrawbacks and challenges. Any organization that seeks toimplement CRM may focus on value creation and on acontinuous stream of profits. They will give up theirmyopic fix that CRM is the fixed responsibility ofmarketing or IT department. The firms will realize that inorder for CRM to contribute to corporate renaissance, theCRM responsibility must rise to the level of CEO. CRMwill be more strategy driven, and thus be able toconcentrate on what customer expects from relationships.The ‘final take’ for the CEOs will be that CRM is and canbe a vehicle for cultural integration in the organization. Inshort, a true CRM encourages a relationship view of theworld that goes beyond the customers, includes multi –members and facilitates corporate renaissance [13].C. Background to CRM and Higher EducationKotler and Fox [14] argued that over the decades, thevocabulary of marketing, particularly marketing research,market segmentation and strategic marketing planning,has become widely used in the realm of higher education.This has even progressed to the point that in recent years,the trends towards establishing market-oriented or 2017 International Journal of Learning and Teaching301
International Journal of Learning and Teaching Vol. 3, No. 4, December 2017universities. A consequence of this phenomenon is theincreasing amount of free and on-the spot informationabout programs description, college amenities andschools’ ranking available to potential students whichhave made them to be choosy about their studies [24].Hence, as the result of the increasing globalization andinformationization and some other factors includingpopulation demographics, work force requirements andnew methods of delivering education, it is of littlesurprise if universities’ managers and policy makers havestarted to think of a strategic planning in order to developand maintain a smart balance between the institutions’capabilities and objectives and its changing externalenvironment. As a part of this strategic planning,marketing policy of a university can be considered as animportant conveyor of the university’s missions to thesociety by attracting talented and qualified students fromall around the world.From the wave of globalization, there was the need forUniversities to be customer centric. Achieving students’satisfaction will take such institutions to the point that along-standing relationship can be established in which,both sides, students and universities, can take advantagesfrom it. According to [25], “relationships take on thecharacter of companions for life”, given that life-longlearning approach in the current world has made studentsto not only studying at universities once, but also to haverecourse to these institutions again and again overtime[25]. To underline the importance of relationship inhigher education, Pausits has also stated that highereducation institutions should no longer hold the attitudeof being “ivory towers” and have to transform into“relationship-based organizations.”employ CRM to manage relationships with their studentsand alumni. He supports his idea by giving an examplethat, if a student enjoys his or her experiences at auniversity, he or she might recommend it to his/herpersonal networks afterwards.A recent study (2016) by the American AssociationRegistrars and Admissions Officers(AACRAO) wasconducted on the application of CRM. The survey wasconducted with 603 admissions and enrollmentmanagement officers. From the survey, it was observedthat 64% observed at least one means of CRM in theirinstitution. Another interesting finding is that 42% ofthose institutions who do not have one are consideringone. Further findings establish that few institutions areusing CRM to provide lifecycle management support. Amajority of users (59%) indicated that their institution hasbeen “moderately successful” in the overall use of theCRM.D. Application of CRM in Higher EducationCRM applications need adaptation to thecharacteristics of the institutions [26]. In response to thesechanges, the value, effectiveness and potential benefits ofusing marketing theories and concepts, which have beeneffective in the business world, are now being applied bymany universities: with a view to gaining a competitiveedge, and gaining a larger share of the internationalmarket. According to [25], nowadays, universitiesFrom the Table I, we find that there is correlationbetween whether the University has a formal system ofCRM and Student loyalty. There is a negative correlationbetween the two with P Correlation coefficient of -.219.The P value is .028 which is less than 5% and thereforewe reject the Null hypothesis that CRM has no impact onStudent Loyalty in a University system and accept thealternative Hypothesis.III.A survey has been undertaken with different studentsin various Public Universities in Mauritius. A sample of101 students was taken for this study. This survey willseek to understand the importance of relationshipbuilding in a Higher Education Environment. Statisticaltests using SPSS has been used for analyzing theimplications of CRM. Some tests that have beenundertaken are the Chi Square Tests, Correlation betweenCRM and Satisfaction and Loyalty, cross-tabulations aswell calculating a Student Index amongst others.IV.Figure 1. CRM and student retention in higher education 2017 International Journal of Learning and TeachingMETHODOLOGY302RESULTS
International Journal of Learning and Teaching Vol. 3, No. 4, December 2017TABLE I. CORRELATION BETWEEN DIFFERENT CRM VARIABLESCorrelationsDoes your institution To what extent do you think that Do you think that CRMhave a formal CRM? CRM affects student loyalty?affects student Loyalty?Pearson 1Does your institution have aSig. (2-tailed)formal CRM?NPearson CorrelationTo what extent do you think thatSig. (2-tailed).028N101101101Pearson Correlation.061-.0471Sig. (2-tailed).547.640N101101.640CRM affects student loyalty?Do you think that CRM affectsstudent Loyalty?101*. Correlation is significant at the 0.05 level (2-tailed).TABLE II. DENTIFY SOME FAILURES YOU ARE FACING AS STUDENTS?* DO YOU THINK THAT CRM IS IMPORTANT IN HE? CROSSTABULATIONCountDo you think that CRM is important in HE? TotalYesNoLack of effective infn on courses9413Lack of administrative support33841Lack of integration between depts.17017Lack of communication14216Lack of follow up on courses909Weak Employees Culture4158615101Identify some failures you are facing as students?TotalTABLE III. DOES YOUR INSTITUTION HAVE A FORMAL CRM? * TO WHAT EXTENT DO YOU THINKTHAT CRM AFFECTS STUDENT LOYALTY?CROSSTABULATIONChi-Square TestsValuedfAsymp. Sig. (2-sided)Pearson Chi-Square6.154a2.046Likelihood Ratio7.2842.0264.7841.029Linear-by-Linear AssociationN of Valid Casesa.1011 cells (16.7%) have expected count less than 5. The minimum expectedcount is 4.75.Symmetric MeasuresValueApprox. Sig.Phi.247.046Cramer's V.247.046Nominal by NominalN of Valid Cases 2017 International Journal of Learning and Teaching101303
International Journal of Learning and Teaching Vol. 3, No. 4, December 2017[7]Fig. 1 shows that most of the students claimed thatCRM is quite important followed by Very Important.Only a few students were of the view that CRM is lessimportant as a means to retain existing students. This isexactly in line with the existing literature which showsgrowing importance of CRM in Higher Education due toglobalization and increasing competition (Marginson andWende, 2006).The Table II above summarises some of the failuresidentified in a Higher Education context in Mauritius. Wecan find that most students complain of lack ofadministrative support as a major failure in the Highereducation system followed by lack of integration betweendepartments. This contradicts Tinto’s model (1992)which explains that student characteristics are the majorreason for student dropout rates.The hypothesis to be tested is that there is norelationship between having a formal CRM and studentloyalty in a Higher Education setting. Both data usedwere categorical in nature and therefore appropriate forthe analysis. The P value is less than 5% and therefore wereject the Null Hypothesis and accept the alternative one.However, the Phi and Cramer’s V value show a weakrelationship between the two variables.Table III above shows the Chi Square Test valuesbetween having a formal CRM and whether studentsbelieve that CRM affects student loyalty. The Chi squaretest gives a P value of 0.046 which means that it is lessthan 5%. Therefore, we reject the null hypothesis thatCRM does not have any effect on student loyalty.Therefore the alternate hypothesis is accepted. However,to know the degree of association we need to look at thePhi and Cramer’s V value. In the present case, the Phiand Cramer’s V is at 0.247 consequently a very poorassociation identified. Literature review shows that thereis a positive association however the poor associationneeds to be analysed further through some qualitativestudies and :Communication, interaction, dialogue, value,” Journal of Businessand Industrial Marketing, vol. 19, no. 2, pp. 99-113, 2000.TEC Report, The Quality Audit of Higher Education Institutions,MOE, 2015.S. L. Szeinbach, J. H. Barnes, and D. D. Garner, “Use ofPharmacautical manufacturer’s value added services to buildcustomer loyalty,” Journal of Business Research, vol. 40, no. 3, pp.229-236, 1997.W. Reinatz and V. Kumar, “The impact of customer relationshipcharacteristics on profitable lifetime duration,” Journal ofPersonal Selling and Sales Management, /www.gartner.comJ. Chen and K. 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Yorke, “Strategic planning inhigher education: Who are the customers?” The InternationalJournal of Educational Management, vol. 8, no. 6, pp. 29-36,1994.Darlastan and Jones, et al., “Perceptions of service quality inhigher education,” A Case study of Colombian University, 2003.L’Express, Press Article related to Problems in Higher Educationin Mauritius, 2015.M. A. King, “A strategic assessment of the higher educationindustry: Applying the porter’s five forces for industry analysis,”presented at the Southeastern Decision Sciences Institute AnnualConference, Pamplin College of Business, Virginia Polytechnicand State University, 2008.A. Pausits and A. Pellert, Higher Education Management andDevelopment in Central, Southern and Eastern Europe, Munster:Waxmann, 2007.P. Raman, C. Wittmann, and N. Rauseo, “Leveraging CRM forsales: the role of organizational capabilities in successful CRMimplementation,” Journal of Personal Selling and SalesManagement, vol. 26, no. 1, pp. 39-53, 2006.F. Buttle, Customer Relationship Management: Concepts andTechnologies, 2nd, Oxford: Butterworth-Heinemann, 2009.P. Raman, C. M. Wittmann, and N. A. Rauseo, “Leveraging CRMfor sales: The role oforganizational capabilities in successful CRMimplementation,” Journal of Personal Selling and SalesManagement, vol. 26, no. 1, p. 3953, 2006.Randhir Roopchund is currently Lecturer atAberystwyth University (Mauritius BranchCampus). He has previously worked asLecturer at Université des Mascareignes andhas served as Head of Department for threeyears. He has also worked as Revenue Analystat Air Mauritius. He has received severalprestigious awards.
A Critical Analysis of the Impact of CRM on Higher Education in Mauritius . Randhir Roopchund Lecturer . Aberystwyth University (Mauritius Branch Campus), Quartier Militaire, Mauritius . Email: rar11@aber.ac.uk . Abstract—This research paper seeks to understand the impact of CRM on Higher Education in Mauritius.
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