**4. Discussion**

There are two parts of questions related to organizational and technological factors of CRM that are responded by the respondents:

Below are the responses of respondents on each statement in **Table 2**.



#### *Customer Relationship Management Practices in Islamic Banks DOI: http://dx.doi.org/10.5772/intechopen.89225*

A descriptive analysis is conducted using a survey by distributing questionnaires to support the arguments and elaboration on the CRM practices in Islamic Banks. In this survey, the respondents are the employees from two Islamic banks in Indonesia (PT. Bank Mandiri Syariah and PT. Bank BNI Syariah), which located in Medan City of North Sumatera province. A stratified sampling method is used to collect a total of 22 employees chosen are whom in charge and associated with customer

There are two parts of questions related to organizational and technological

1.45% of respondents agree that top management frequently discusses CRM with

Below are the responses of respondents on each statement in **Table 2**.

2.40.9% of respondents agree that CRM is regarded as a high priority by top

3.22.7% of respondents agree that top management perceives CRM to be part of the organization's vision, while 13.6% of them disagree with the statement.

4.40.9% of respondents agree that top management motivates the employees to achieve the CRM objectives, while none of the respondents disagree with the

5.45.5% of respondents agree that top management is involved to a great degree in CRM implementation, while 18.2% of them disagree with the statement.

6.45.5% of respondents agree that they strive to improve the value, which provided to customers, while 4.5% of them disagree with the statement.

objective, while 10% of them disagree with the statement.

priority, while none of them disagree with the statement.

while 13.6% of them disagree with the statement.

attention to customer service.

with the statement.

**22**

7.28% of respondents agree that customer satisfaction is an important business

8.27.3% of respondents agree that they attempt to understand customer needs,

9.13.6% of respondents both agree and disagree, respectively, that they pay close

10.59.1% of respondents agree that retaining customers is considered to be a top

11.36.3% of respondents agree that the employees are encouraged to focus on customer relationships, while 22.7% of them disagree with the statement.

12.68.2% of respondents agree that the training facilitates employee's learning of effective ways to address customer complaints, while 13.6% of them disagree

the staff involved, while 19% of them disagree with the statement.

management. While 13.6% of them disagree with the statement.

services, sales and marketing, and information technology.

*Customer Relationship Management and IT*

factors of CRM that are responded by the respondents:

**4. Discussion**

statement.


**Statements of technological**

**Customer data measures**

**Scale**

**Agree Neutral Disagree Strongly**

**disagree**

**Strongly agree**

Frequency 2 6 12 2 0 Percentage (%) 9.1 27.3 54.5 9.1 0

Frequency 3 5 9 4 1 Percentage (%) 13.6 22.7 40.9 18.2 4.5

Frequency 1 3 16 1 1 Percentage (%) 4.5 13.6 72.7 4.5 4.5 4. Quality data are available to employees, managers, and supervisors up to a great extent Frequency 3 3 13 3 0 Percentage (%) 13.6 13.6 59.1 13.6 0 5. Quality data, control charts, etc. are displayed on employee's workstations up to a great extent Frequency 5 8 4 3 2 Percentage (%) 22.7 36.4 18.2 13.6 9.1

Frequency 4 4 8 4 2 Percentage (%) 18.2 18.2 36.4 18.2 9.1

Frequency 3 6 7 3 3 Percentage (%) 13.6 27.3 31.8 13.6 13.6

Frequency 4 6 9 2 1 Percentage (%) 18.2 27.3 40.9 9.1 4.5

Frequency 2 4 13 0 3 Percentage (%) 9.1 18.2 59.1 0 13.6

Frequency 0 5 14 2 1 Percentage (%) 0 22.7 63.6 9.1 4.5

Frequency 5 5 10 1 1 Percentage (%) 22.7 22.7 45.5 4.5 4.5

Frequency 3 7 8 2 2

9. We use customer database information to develop attractive offerings

10. We offer a loyalty program to reward repeat customers

11. We provide our sales force with adequate customer information

12. We provide customized offers to sales people in the field

2. Data (error rates, defect rates, scrap, defects, etc.) are easily available when needed

1. The cost of acquiring data within our company is reasonable

*Customer Relationship Management Practices in Islamic Banks*

*DOI: http://dx.doi.org/10.5772/intechopen.89225*

3. We can get access to the quality data on time

**Customer Information Processing Measures**

8. We store data extracted from operational data

6. We gather customer-related data

7. We maintain a customer database

**Integration of CRM Measures**

**25**

**factor**

**Table 2.**

*Statements on organizational factor.*


Based on the statements from the organizational factor above, all 16 statements concluded that the Islamic banks are concerned on the CRM implementation. It is noted that there are two statements: nos. 9 and 15 where the respondents either agree and disagree, meaning that the Islamic banks were not focus on customer service and training, which help to improve employee's team skills that importantly support the CRM initiatives:

Below are the responses of respondents on each statement in **Table 3**.



13.27.2% of respondents agree that training helps employees understand customer

**Strongly agree**

13. Our training helps employees understand customer needs

Percentage (%) 27.3 40.9 18.2 9.1 4.5

Frequency 1 5 11 5 0 Percentage (%) 4.5 22.7 50.0 22.7 0.0

Frequency 3 7 10 1 1 Percentage (%) 13.6 31.8 45.5 4.5 4.5 15. Our training helps improve employee's team building skills to enhance company operations Frequency 1 6 8 6 1 Percentage (%) 4.5 27.3 36.4 27.3 4.5

Frequency 4 6 5 4 3 Percentage (%) 18.2 27.3 22.7 18.2 13.6

14. Our training facilitates interpersonal skill training to build customer relationships

16. Our training facilitates learning to promote the quality of our products/services

**Scale**

**Agree Neutral Disagree Strongly**

**disagree**

14.45.4% of respondents agree that training facilitates interpersonal skill training to build customer relationships, while 9% of them disagree with the statement.

training helps improve employee's team building skills to enhance company

Based on the statements from the organizational factor above, all 16 statements concluded that the Islamic banks are concerned on the CRM implementation. It is noted that there are two statements: nos. 9 and 15 where the respondents either agree and disagree, meaning that the Islamic banks were not focus on customer service and training, which help to improve employee's team skills that importantly

1.36.4% of respondents agree that the cost of acquiring data within our company is

2.36.3% of respondents agree that data (error rates, defect rates, scrap, defects, etc.) are easily available when needed, while 22.7% of them disagree with

16.45.5% of respondents agree that training facilitates learning to promote the quality of our products/services, while 31.8% of them disagree with the

Below are the responses of respondents on each statement in **Table 3**.

reasonable, while 9.1% of them disagree with the statement.

needs, while 22.7% of them disagree with the statement.

15.31.8% of respondents both agree and disagree, respectively, that

operations.

**Table 2.**

*Statements on organizational factor.*

**Statements of organizational**

*Customer Relationship Management and IT*

**factor**

statement.

support the CRM initiatives:

the statement.

**24**


13.59.1% of respondents agree that they control sales through multiple sales

14.71.8% of respondents agree that they assist the marketing department in

generating customized offers, while 4.5% of them disagree with the statement.

15.59.1% of respondents agree that they allow customer support personnel to access data on customer interactions with all functional areas, while 27.3% of them

Based on the statements from the technological factor above, all 15 statements concluded that the Islamic banks are concerned on the CRM implementation.

Among the biggest Islamic banks in Indonesia where all their headquarters are located in Jakarta, CRM initiatives have been adopted just few years ago. This is a concern and a need to improve the development of Islamic banks. The CRM is useful to overcome several issues, for example, the low level of public awareness toward the Islamic banks' products and the low level of Islamic financial literacy, which caused low penetration of Islamic finance that only reached 11.6%. As many of the personnel do not practice effective CRM, some of the Islamic banks thus still engage in training of CRM's familiarization particularly on its systems' applications

In terms of organizational aspect, the top management support is importantly required to implement CRM in Islamic banks especially when the CRM practices involved many departments such as customer services, human resources, information technology, finance/accounting, marketing, production/operation, and multi job tasks. With one commitment from the top management, all the subsidiaries have to obey the instruction of them. From the five questions related to top management support revealed that majority of respondents agreed on its role in CRM implementation. Similarly with the two components of organizational factors (customer orientation and training orientation), a majority of respondents agreed on the imperative influence to CRM practices. Meanwhile, some of the Islamic banks did not have the right structures for recording and updating the customer information.

Thus, they have difficulties to create customer satisfaction and loyalty.

is effective in the attainment of holistic approaches to CRM models.

The adoption of CRM creates more satisfied and loyal customers, thereby resulting in better organizational effects in both the short and long terms [33, 82], among others by the use of loyalty programs and direct mailings as has been suggested by Verhoef [83]. Most Islamic banks have developed relationship management programs to aid in the enhancement of customer relationships. Keramati et al. [84] asserted that a collaboration of people and technology in an organization

Moreover, on the technological aspect, the customer data play a crucial role because it is a main source that must be right, reliable, and valid, otherwise the use of CRM is ineffective. If a requirement of having a good data is fulfilled, then the findings or results on data analysis can be useful to make right decision. Based on the five questions on customer data indicate that a majority of respondents agreed on the significant impact of customer data to CRM implementation. Similarly for the two components of technological factors (customer information processing and integration of CRM), a majority of respondents agreed on both vital effects toward

The Islamic banks have to upgrade the database system of CRM. The details of the customers including their names, phone links, and other communication data are captured in the database. In addition, for every transaction including deposits and withdrawals, the details of the customers must be updated. Most of the Islamic

channels, while 27.3% of them disagree with the statement.

*Customer Relationship Management Practices in Islamic Banks*

*DOI: http://dx.doi.org/10.5772/intechopen.89225*

disagree with the statement.

and technical functions.

the CRM practices.

**27**

#### **Table 3.**

*Statements on technological factor.*


Based on the statements from the technological factor above, all 15 statements concluded that the Islamic banks are concerned on the CRM implementation.

Among the biggest Islamic banks in Indonesia where all their headquarters are located in Jakarta, CRM initiatives have been adopted just few years ago. This is a concern and a need to improve the development of Islamic banks. The CRM is useful to overcome several issues, for example, the low level of public awareness toward the Islamic banks' products and the low level of Islamic financial literacy, which caused low penetration of Islamic finance that only reached 11.6%. As many of the personnel do not practice effective CRM, some of the Islamic banks thus still engage in training of CRM's familiarization particularly on its systems' applications and technical functions.

In terms of organizational aspect, the top management support is importantly required to implement CRM in Islamic banks especially when the CRM practices involved many departments such as customer services, human resources, information technology, finance/accounting, marketing, production/operation, and multi job tasks. With one commitment from the top management, all the subsidiaries have to obey the instruction of them. From the five questions related to top management support revealed that majority of respondents agreed on its role in CRM implementation. Similarly with the two components of organizational factors (customer orientation and training orientation), a majority of respondents agreed on the imperative influence to CRM practices. Meanwhile, some of the Islamic banks did not have the right structures for recording and updating the customer information. Thus, they have difficulties to create customer satisfaction and loyalty.

The adoption of CRM creates more satisfied and loyal customers, thereby resulting in better organizational effects in both the short and long terms [33, 82], among others by the use of loyalty programs and direct mailings as has been suggested by Verhoef [83]. Most Islamic banks have developed relationship management programs to aid in the enhancement of customer relationships. Keramati et al. [84] asserted that a collaboration of people and technology in an organization is effective in the attainment of holistic approaches to CRM models.

Moreover, on the technological aspect, the customer data play a crucial role because it is a main source that must be right, reliable, and valid, otherwise the use of CRM is ineffective. If a requirement of having a good data is fulfilled, then the findings or results on data analysis can be useful to make right decision. Based on the five questions on customer data indicate that a majority of respondents agreed on the significant impact of customer data to CRM implementation. Similarly for the two components of technological factors (customer information processing and integration of CRM), a majority of respondents agreed on both vital effects toward the CRM practices.

The Islamic banks have to upgrade the database system of CRM. The details of the customers including their names, phone links, and other communication data are captured in the database. In addition, for every transaction including deposits and withdrawals, the details of the customers must be updated. Most of the Islamic

3.18.1% of respondents agree that they can get access to the quality data on time,

**Strongly agree**

Percentage (%) 13.6 31.8 36.4 9.1 9.1

Frequency 5 8 3 0 6 Percentage (%) 22.7 36.4 13.6 0 27.3

Frequency 4 14 3 1 0 Percentage (%) 18.2 63.6 13.6 4.5 0 15. We allow customer support personnel to access data on customer interactions with all functional

Frequency 4 9 3 4 2 Percentage (%) 18.2 40.9 13.6 18.2 9.1

**Scale**

**Agree Neutral Disagree Strongly**

**disagree**

4.27.2% of respondents both agree that quality data are available to employees, managers, and supervisors up to a great extent, while 13.6% of them disagree

5.59.1% of respondents agree that quality data, control charts, and so on are displayed on employee's workstations up to a great extent, while 22.3% of them

6.36.4% of respondents agree that they gather customer-related data, while 27.3%

7.40.9% of respondents agree that they maintain a customer database, while 27.2%

8.45.5% of respondents agree that they store data extracted from operational data,

9.27.3% of respondents agree that they use customer database information to develop attractive offerings, while 13.6% of them disagree with the statement.

10.22.7% of respondents agree that they offer a loyalty program to reward repeat

11.45.4% of respondents agree that they provide our sales force with adequate customer information, while 9% of them disagree with the statement.

12.45.4% of respondents agree that they provide customized offers to sales people

customers, while 13.6% of them disagree with the statement.

in the field, while 18.2% of them disagree with the statement.

while 9% of them disagree with the statement.

with the statement.

*Statements on technological factor.*

**Statements of technological**

*Customer Relationship Management and IT*

13. We control sales through multiple sales channels

14. We assist the marketing department in generating customized offers

**factor**

areas

**Table 3.**

**26**

disagree with the statement.

of them disagree with the statement.

of them disagree with the statement.

while 13.6% of them disagree with the statement.

banks should have automated processes, where details of the customers are automatically captured in the relevant fields for every successive transaction. Moreover, data retrieval for the different customers is a click away, and customers' details can be traced by keying in their names. This is particularly helpful as staff can trace the saving history of different clients and advice the customers in case of any problems or issues.

There are several issues that may face by the Islamic banks in implementation of CRM such as the absence of sufficient human resource and lacked the general knowledge on the best practices to achieve the better performance. The systems and technology embedded in CRM will support the existence of human personnel to maintain the personalized services. Meanwhile, the Islamic banks offered the highest level of customer service to their clients; thus, CRM is a right system to use in accommodating any expectations. Additionally with the emergence of the online platform including social media, the Islamic banks have to improve the quality of their interaction with customers.

The CRM system is designed to compile customer data and information through different channels, which connect the company and customers. The channels include live chat, social media, marketing materials, emails, telephone, and the company's website. The systems also provide the customer services staff with data that will improve the experience of the client. Through this system, the company is able to complete customer's information on their personal information, buying preferences and purchase history. Thus, the systems deliver various benefits especially in creating a personalized experience.

In Islamic view, CRM is complied with the shariah where more benefits can be obtained by the *ummah* (society). Maintaining relationships with customers and enhancing easy ways in dealings are considered as bringing the goodness to all people. Islam encourages Muslims to involve in a good intention, process, and actions, which results valuable outcomes that are not harming others. All of this can be done and achieved through CRM implementation.

#### **5. Conclusion**

The Islamic banks realized the importance of CRM to the organization and the customers. Organizations in today's world must remain responsive to the dynamic needs of the customers. Through applications or platforms provided in the CRM, all information related to customers' preferences and expectations are available and can be used to create a personalized experience. Thus, CRM concept is a way to help companies in anticipating the same needs and desires of their future customers.

The results and discussions in this chapter suggest that many of the Islamic banks are concerned on the implementation of CRM and admitted its usefulness in a bigger context. It can also be adopted to create competitive advantage that will develop the Islamic banks. CRM is a continuous learning process aimed at increasing the understanding and knowledge of a company's client. It is a complex issue, which requires a holistic approach in the transformation of the culture of customers. In general, CRM is an increasingly important aspect to the Islamic financial institutions that will improve the company's chances of retaining and attracting new customers.

**Author details**

Faculty of Economics and Business, Universitas Medan Area, Medan, Indonesia

© 2019 The Author(s). Licensee IntechOpen. This chapter is distributed under the terms of the Creative Commons Attribution License (http://creativecommons.org/licenses/ by/3.0), which permits unrestricted use, distribution, and reproduction in any medium,

\*Address all correspondence to: hahmadrafiki@gmail.com

*Customer Relationship Management Practices in Islamic Banks*

*DOI: http://dx.doi.org/10.5772/intechopen.89225*

provided the original work is properly cited.

Ahmad Rafiki

**29**

*Customer Relationship Management Practices in Islamic Banks DOI: http://dx.doi.org/10.5772/intechopen.89225*

banks should have automated processes, where details of the customers are automatically captured in the relevant fields for every successive transaction. Moreover, data retrieval for the different customers is a click away, and customers' details can be traced by keying in their names. This is particularly helpful as staff can trace the saving history of different clients and advice the customers in case of any

There are several issues that may face by the Islamic banks in implementation of

The CRM system is designed to compile customer data and information through

In Islamic view, CRM is complied with the shariah where more benefits can be obtained by the *ummah* (society). Maintaining relationships with customers and enhancing easy ways in dealings are considered as bringing the goodness to all people. Islam encourages Muslims to involve in a good intention, process, and actions, which results valuable outcomes that are not harming others. All of this

The Islamic banks realized the importance of CRM to the organization and the customers. Organizations in today's world must remain responsive to the dynamic needs of the customers. Through applications or platforms provided in the CRM, all information related to customers' preferences and expectations are available and can be used to create a personalized experience. Thus, CRM concept is a way to help companies in anticipating the same needs and desires of their future

The results and discussions in this chapter suggest that many of the Islamic banks are concerned on the implementation of CRM and admitted its usefulness in a bigger context. It can also be adopted to create competitive advantage that will develop the Islamic banks. CRM is a continuous learning process aimed at increasing the understanding and knowledge of a company's client. It is a complex issue, which requires a holistic approach in the transformation of the culture of customers. In general, CRM is an increasingly important aspect to the Islamic financial institutions that will improve the company's chances of retaining and attracting new

CRM such as the absence of sufficient human resource and lacked the general knowledge on the best practices to achieve the better performance. The systems and technology embedded in CRM will support the existence of human personnel to maintain the personalized services. Meanwhile, the Islamic banks offered the highest level of customer service to their clients; thus, CRM is a right system to use in accommodating any expectations. Additionally with the emergence of the online platform including social media, the Islamic banks have to improve the quality of

different channels, which connect the company and customers. The channels include live chat, social media, marketing materials, emails, telephone, and the company's website. The systems also provide the customer services staff with data that will improve the experience of the client. Through this system, the company is able to complete customer's information on their personal information, buying preferences and purchase history. Thus, the systems deliver various benefits espe-

problems or issues.

**5. Conclusion**

customers.

customers.

**28**

their interaction with customers.

*Customer Relationship Management and IT*

cially in creating a personalized experience.

can be done and achieved through CRM implementation.
