Transformative Power of AI in Customer Relationship Management (CRM): Potential Benefits, Pitfalls, and Best Practices for Modern Enterprises
Hiran Amarasinghe
Open University of Sri Lanka, Polonnaruwa Campus, Department of business administration, Open University of Sri Lanka, Mihintale Road, Polonnaruwa, Sri Lanka
Keywords: Artificial Intelligence (AI), Customer Relationship Management (CRM), Predictive analytics, Personalization, Ethical usage
Abstract
The integration of Artificial Intelligence (AI) into Customer Relationship Management (CRM) presents both significant opportunities and challenges for modern enterprises. This research examines the transformative potential of AI in CRM, highlighting its myriad benefits and inherent pitfalls. On the positive side, AI fosters enhanced customer insights through sophisticated data analysis, streamlining marketing endeavors. Improved customer service becomes feasible with chatbots addressing routine inquiries, and predictive analytics offer advanced sales forecasting. Personalization emerges as a standout benefit, tailoring interactions to individual customers. Additionally, automation reduces manual administrative burdens, while churn prediction mechanisms help retain valuable clientele. However, pitfalls await the unwary. Over-reliance on AI risks sidelining human intuition and judgment, essential for nuanced customer interactions. Furthermore, privacy issues, if not addressed with transparency, can lead to mistrust. Integrating AI with existing CRM systems poses technical challenges, and a failure to understand AI's limitations can misguide strategy. Importantly, over-automation might erode the valued personal touch in customer interactions. Best practices suggest a strategic, targeted AI adoption, emphasizing continuous model training. Ethical AI usage, with a focus on customer data privacy, is paramount. A combined approach, pairing AI's efficiency with human empathy, often yields the best results. Employees should be trained in AI tool usage, ensuring ethical and effective practices. Regular feedback mechanisms refine AI processes, ensuring continuous improvement. In essence, while AI offers transformative potential for CRM, a balanced, informed approach ensures that technology amplifies human efforts, fostering growth and customer satisfaction.
Author Biography
Hiran Amarasinghe, Open University of Sri Lanka, Polonnaruwa Campus, Department of business administration, Open University of Sri Lanka, Mihintale Road, Polonnaruwa, Sri Lanka
Hiran Amarasinghe
Open University of Sri Lanka, Polonnaruwa Campus,
Department of business administration, Open University of Sri Lanka, Mihintale Road, Polonnaruwa, Sri Lanka
