Case Study on

Adzhar IsmailIda Azura Ahmad Zamri

Siti Marsita IsterinMohd Rafizi Rahmad

• Background IHOP• Question 1 : Knowledge of Customer• Question 2 : Getting to know their Customer• Question 3 : Analyse the dimensions• Question 4 : Best Solution• MIS in Action• Analysis• References

HISTORY• 1958 - Establish in Los Angeles, California

Founder Al and Jerry Lapin• 1973 - IHOP acronym was introduced in • 1993 - System wide sales reach $1 billion in • 1999 - Trading in NYSE under symbol IHP• 2004 - Winning Advertising and Marketing

Awareness Award• 2008 – celebrates 50th Anniversary.

Overview

• IHOP one of the biggest family restaurant in U.S• More 99% outlet operated by independent

franchisee• Slogan “ Come Hungry, Leave Happily”• As at 30th June – 1361 restaurants located 49 states

including Canada and Mexico.

Question 1. How does knowledge of customers

impact IHOP’s business performance?

• Knowledge Management Systems (KMS), as a special kind of information system, is no different to an “intangible” asset.

• Many investments in “intangible” assets take some time to actually influence performance and in the lapse of time between the acquisition of the intangible asset and the actual influence of its use any other external or internal event may affect the outcomes (José Antonio Robles-Flores, 2004).

• Knowledge sharing can always help to improve business performance (Mike Goodfriend, 2002).

(Suresh, R. Knowledge Management- An Overview. www.knowledgeboard.com/library/km_an_overview.pdf )

Most companies know the importance of knowing as much as possible about their customers. Typically, there is a lot ofinformation on record, but it is rarely collated into a sound knowledge base. One frequently overlooked way of gathering information is to ask the customers what they want. (Mike Bagshaw, 2000)

Customer Relationship Management

Customer Relationship Management is the establishment, development, maintenance and optimisation of long-term mutually valuable relationships between consumers and organisations. (www.marketingteacher.com )

• CRM is both a business and technology discipline for managing customer relationships to optimize revenue, profitability, customer satisfaction and customer retention.• IHOP try to improve their customer data by integrating all the database their have.

Question 2Why did IHOP have trouble

getting to know its customers?

THE ISSUES• No method for synchronizing or cleansing data.• No single central company repository system.

• Challenge to improve communication with customers.• No integrated, real time view of each caller’s membership level

and transactions.

(An Oracle White Paper February 2005)

PROVIDER

Seeks value

PROVIDER

Seeks value

CUSTOMER

Seeks value

CUSTOMER

Seeks value LONG TERM

OFFERSPurchase, support and loyalty

OFFERS Goods and services

- long-term exchange relationship

 (introduction to marketing concept)

Jobber (2001) defines customer value as being dependent on perception:

Customer value =Perceived benefits -Perceived sacrifice

Perceived benefits are determined by the product, associated services (e.g. delivery, maintenance, etc.) and association/relationship with the provider.

perceived sacrifices are factors like cost, risk/uncertainty and time involved in purchase.

•As business evolves it is critical to ‘know’ who your customers really are.

•Organizations must admit that to not shortsighted IT decisions to meet their users’ immediate needs.

•The two conventional approaches to unify customer information are to synchronize all source systems with one another, or copy data into a common place for reporting and analysis

•IHOP decided to use oracle teleservice and oracle customer data hub

• THE IMPORTANCE OF CRM SOFTWARE– Understand the various job roles in your company and how each

interacts with your customers– customers know what they want and "understanding customers puts

companies in a stronger position to provide rapid, relevant service." – A more powerful and secure IT infrastructure; all information is

transferred over an encrypted page and although all employees with user access can view company data, a role hierarchy with customized security settings may be set

– From a technology perspective, CRM implies the integrated use of customer information combined with operational, analytical and support tools which empower staff and provide a superior delivery mechanism to customers (http://www.online-crm.com/crm_defined.htm)

Question 3 How has the company chosen to

improve its knowledge of customers? Analyze the

management, organization, and technology dimensions of the

solutions.

• IHOP focus on coordinating the business process surrounding a firm’s interactions with its customers in sales and marketing .

• This is by using the IHOP’s Oracle Customer Data Hub whereby data flows from one department to the other without any paper being generated.

• Oracle Teleservice also assisting IHOP to increase customer satisfaction while reducing service costs.

DIMENSIONS OF THE SOLUTIONMANAGEMENT - built on the right business foundation.

- "It's really about improving the efficiency of the overall corporation“.

ORGANIZATION - allows the company to track milestones for new restaurants, including major steps such as real estate approvals and construction timelines.

TECHNOLOGY - IHOP built the program in Java. - the data hub infrastructure can bring up a new application and synchronized the data-E-marketing perspectivesLower costs e.g. web-based sales processingMarket access e.g. menu online, promo activitiesMarket research/information e.g. info provide comprehensive understanding of customers.

Question 4Did IHOP choose the best

solution? Explain your answer

STRENGTHCoherent Brand/ Portfolio Strategy•Impressive & advanced strategy with its current competitors.Value Chain & Market Alignment•Strong product suite for applications & DBMS management that plays to Oracle’s market strength as a company.Stability & Viability•Very experience IT management group.

WEAKNESS

Coherant Brand/ Portfolio Strategy• It need to advertise more and use it to leverage client interest in current situations.

OPPORTUNITYMarket Dynamics•Business value is the key market driver strategy•Unique position in the application & database world that strongly supports the growth in current portfolio sales.•Focus on the next wave of IT management solutions.Client Perception & Adoption•High customer satisfaction

THREATS

Market Dynamics• Oracle’s vision will appeal only to the most mature enterprises in the next 12 to 36 months.Competitive Position• The competition to the current portfolio seems to weaken.

Oracle Customer Hub Data (CHD)• Data hubs provide a central place where

companies can store customer and product information that's been standardized, enriched, deduplicated, without disrupting existing business processes and the supporting IT investments that already exist.

• Key features:• Centralize & build master customer

identity – reducing error & duplications,

• Improve data quality – lower the operational cost & improve reporting accuracy

• Synchronize data across enterprise – improve real time decisions

• Gain accurate insight – reliability if customer analytics

Oracle Tele ServiceOverview

• Oracle® TeleService is the contact center application that delivers effective and personalized customer service while reducing costs.

• It is the key component of the Oracle Customer Relationship Management solution, the integrated suite that drives profitable customer interactions.

• Benefits:• Resolve issues faster • Reduce cost of service• Drive revenue from service interactions

The Oracle Customer Data HubThe Oracle Customer Data Hub collects customer data from source applications using high-volume batch and real-time integration services. More than fifty types of changes to customer records can be detected. As the data is collected, duplicates are identified, data quality is verified, addresses validated, profile and credit information is enriched, source system cross-references are maintained, and master blended records are created.

Benefits • One master customer identity for all global business units • One data model allowing for flat and hierarchical relationships • One standard process for record creation and approval • One centralized customer data store • One viewer to see all global customer transactions & intelligence • One customer list

MIS in Action

MIS - Question 1Does this website provide opportunities for IHOP t

gather data about its customers? Describe the customer data collected at the Web site and explain how IHOP can use the data to improve its business

performance.

MIS - Question 2Is this Web site well-designed for interacting with

customers and gathering customer data? What other customer data could this Web site collect?

What is a IHOP gift card?

• Using a concept of debit card• Acceptable at all IHOP chain restaurant• Available in denominations from $5 - $ 50• Gift card available at any IHOP restaurant and also can be purchase through online (IHOP web site)

MIS - Question 3How would you redesign the

Web site to increase interactions with customers?

Suggestion to redesign the web site to increase interactions with customers :

• Provide Self Generating Content ; The website doesn't provide any means to capture user input. By allowing users interacting with the site, this allow user to provide content for the website.

• Interactive forum ; Interaction among users - the website could allow users to share their thoughts, opinions, and suggestions. This is to create the user community.

• Automated/script driven surveys ; IHOP can improve their services, food, pancakes, and website quality if they do not capture feedbacks from the customers & visitors.

Analysis

THE 4P’S MARKETING MIXTHE 7P’S

EXTENDED MARKETING MIX

Product Price Pricing modelProduct range Discount policyProduct performance Branding Credit termsPackaging Non-financial costDesignService support

Place/distribution PromotionalChannel selection AdvertisingSupport supplied by Sales forcechannel members Direct marketing/Market/customer coverage On-line Public relations

Physical evidenceMarket tangible assetsTaken as quality measure

Process Fulfillment Administration

PeopleRecruitmentTraining/skillsInteraction with Customers

Porter’s 5 Forces Level IHOP Competitive Advantage

Supplier Power Powerful • IHOP had biggest chain restaurant in US• Good supplier intimacy Yes

Barriers to Entry Moderate • Technology wise- e.g. download menu online so do ordering.

• e-marketingYes

Treat of Substitute

Moderate • emerged as substitute to other products offered by other retailers

• Buyer can always turned to the conventional/inline way of shopping

Yes

Buyer Power Powerful • Moderately priced, high quality food and beverage item.

• IHOP open throughout the day and evening hours.

• convenient customer experience

Yes

Degree of Rivalry

Moderate • wide range of varieties• have brand distinctiveness• Known for value added services

Yes

REFERENCES• Advantages and Disadvantages CRM: Gain the Business Advantage Retrieved 18 Ogos 2008 from

http://www.salesboom.com/crm/crm-software/advantages-and-disadvantages-crm.html• Customer Relationship Management. Retrieved 19 Ogos 2008 from

http://www.12manage.com/methods_customer_relationship_management.html• Consume complaints and review of IHOP – customer service. Retrieved 18 Ogos 2008 from

www.my3cents.com/companyReview.cgi?compid=377&subcat=6 - 44k -• How improving the customer experience can reduce spending. Retrieved 18 Ogos 2008 from

http://www.profitmagazine-digital.com/profitmagazine/200808/?pg=64• IHOP and The Ritz-Carlton—In Competition for the Same Customers?. Retrieved 19 Ogos 2008 from

http://www.alainjroy.com/docs/IHOP_and_The_Ritz.pdf• IHOP case studies http://www.hodes.com/casestudies/pdfs/IHOP.pdf• IHOP main web page http://ihop.com/• Jobber, D. (2001) Principles and Practice of Marketing, 3rd edn. McGraw–Hill.• Kenneth C. Laudon. (2008). Management Information Systems:Managing The Digital Firm. Prentice Hall : New

Jersey.• Oracle Customer Data Hub: Four Steps to Customer Insight, An Oracle White Paper February 2005. Retrieved 4

September 2008 from http://whitepapers.zdnet.com/abstract.aspx?docid=327223.• Bagshaw, Mike. (2000). Why knowledge management is here to stay. Industrial and Commercial Training Volume

32 . Number 5 . 2000 . MCB University Press . ISSN 0019-7858. 179±182• SITEL France Enhances Customer Satisfaction and Increases Revenue and Services. Retrieved 19 Ogos 2008 from

http://ww w.oracle.com/customers/snapshots/sitel-siebel-casestudy.pdf• Suresh, R. Knowledge Management- An Overview. Retrieved 18 Ogos 2008 from

www.knowledgeboard.com/library/km_an_overview.pdf