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Does Customer Relationship Management Activity Affect Firm Performance?

Harmeen Soch (Ph.D.) is Senior Lecturer of Marketing, Department of Commerce & Business Management, Guru Nanak Dev University, Amritsar, India. E-mail: meenu_soch{at}yahoo.com

H.S. Sandhu

H.S. Sandhu (Ph.D.) is Professor of Marketing, Department of Commerce & Business Management, Guru Nanak Dev University, Amritsar, India. E-mail: sandhu_hs12{at}yahoo.com

The focus of this study is to find out the impact of Customer Relationship Management (CRM) on the financial performance of firms in India. The study identifies four CRM constructs – customer need sensing, communication, intermediaries, and the internal environment of firms. A CRM scale is developed, refined and validated and confirmatory factor analysis is used to examine the model fit. Firm data on profitability and growth is used as performance indicators for estimating the regression model. Using a large sample of 171 firms from eight different industry types, results suggest that there is a positive influence of CRM on firm performance but that this impact is insignificant.

Global Business Review, Vol. 9, No. 2, 189-206 (2008)
DOI: 10.1177/097215090800900202


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