Customer Relationship Management:

Customer relationship management (CRM) is a broad term that covers concepts used by companies to manage their relationships with customers, including the capture, storage and analysis of customer information designed to reduce costs and increase profitability by strengthening customer loyalty.

There are three aspects of CRM which can each be implemented in isolation from each other:
Operational CRM- automation or support of customer processes that include a company’s sales or service representative
Collaborative CRM- direct communication with customers that does not include a company’s sales or service representative (“self service”)
Analytical CRM- analysis of customer data for a broad range of purposes

A typical CRM system is subdivided into three basic sub modules:
Marketing
Sales
Service

Marketing sub module primarily deals with providing functionalities of Long-term planning and Short-term execution of marketing related Activities within an organization.

Sales functionalities are focused on helping the Sales team to execute and manage the presales process better and in an organized manner. Sales team is responsible for regularly capturing key customer interactions, any leads or opportunities they are working on etc, in CRM system. The system helps by processing this data, monitoring against the targets and proactively alerting the sales person with recommended further actions based on company's sales policy.

Service related functionalities are focused on effectively managing the customer service (Planned or Unplanned), avoid "leakage" of Warranty based services, avoid "Penalties" arising due to Non conformity of SLA (Service Level Agreements), and provide first and Second Level support to Customers.

Several commercial CRM software packages are available which vary in their approach to CRM. However, CRM is not just a technology, but rather a holistic approach to an organization's philosophy in dealing with its customers. This includes policies and processes, front-of-house customer service, employee training, marketing, systems and information management.
The objectives of a CRM strategy must consider a company’s specific situation and its customer’s needs and expectations.