The Importance Of Having A Customer Database Information Technology Essay

The function of the customer database is to inform the history and the story of your customers over a period of time definition. The customer database can be seen as one of the most important tools in an organization. It stores detailed information about you current customers which can used to enhance external efficiency. Each database is uniquely molded to suit the needs of an organization, containing only the customer information which is significant to the activities. For example an Automobile company does not need to know what their next planned property purchase might be, this would be more appropriate for a Real estate agency.

Information stored in a customer database could be contact information, when you have contacted them and what they discussed, what adverts brought them to you, what advertising material you sent to them, what their predicted long term value is or even special offers they have participated in. There is a wide variety of customer information which can be stored on a database. The key is to choose the appropriate information which can be utilized effectively by helping accomplish marketing objectives.

The tasks involved in establishing and maintaining a customer database.

There are a number of ways in which a customer database can be established. Microsoft Access is one option, a program which enables a company to create a database using workable systems. Employees can then be trained in Microsoft Access and assigned to maintaining the customer database. An alternative method of maintenance would be to hire a company specialized in the maintenance of the Microsoft Access database. This method could prove to be more cost effective in the long term.

A customer database is established using a large number of different sources depending on what type of business you are specialized in. However there is one type of fundamental data on which any new database should be based on. Primary data in regards to the customers’ age, gender and nationality for example could be a good foundation for any new database.

There are four important non-technical skills which are key to establishing a customer data base. Everyone taking part in the construction of the database must have a good level of communication within the group; this will enhance the final outcome. It is also important that there are people involved in the design process who have good knowledge of the business. This will encourage making the choices best suited for the organization in terms of database design. Having creativity within the group can help solve problems in a cost effective manner or seek out other options.

During the maintenance stage it is important to remember that the database doesn’t have to contain every single detail about the customer but it is however important to have a good level of basic information. For example the customer’s name, company’s name and telephone number are examples of basic information.

The database should be credible; all the items listed must be spelled and recorded correctly. Any mistakes made during this part of the process could result in a very ineffective database. Making sure standard data formats are implemented is another step in the maintenance process. For example international telephone numbers can have a different number of digits and therefore need to be considered when maintaining the database entry format. Duplication within the database should be avoided and removed to ensure the database is valid. It is important that all names are stored in the same format and that all previous processes are followed correctly to guarantee a problem free database. A database should be completed to the best of the maintainer’s ability. If there are issues with acquiring the data the field should not be left blank. In addition the date and time of the entry should always be included. This enables anyone who looks at the database to automatically identify which data is old and which data need to be updated. A database should be organized objectively and should filter out which contacts are beneficial and which ones aren’t. It is important to remember that a database is used to increase communication with existing customers; consequently for suppliers and competitors a new database should be created. Changing information within a database can be limited to either one person who is in charge of the maintenance or an open process in which employees can maintain the database themselves by using a password. Having one person in charge could decrease any problems that might arise using multiple entry methods. Due to regular changes in the world today a database should be updated on a regular basis. Contacting the customer once a year to verify the database information will be sufficient for keeping information up-to-date. To conclude maintaining a database is a very important part of keeping active communication with existing customers. The decision whether to hire an employee within an organization for this task or to outsource the job to a professional company is one of the biggest decisions. A company specialized in maintaining customer databases could prove to be more time and cost effective as well as saving any inconvenience an additional employee could bring to an organization.

Ethical and data protection issues on holding personal information on a database.

The UK Data Protection Act of 1998 imposes certain restrictions on the collection and

use of personal data. This includes the contents of oral history recordings and any

accompanying documentation.

When referring to a customer database it is important to get permission from individuals before collecting their data. If there is an intention of passing their information on in the future it is important to mention this in the consent form.

There are certain ethical issues which need to be considered when creating a database. It is vital that the people who will be entered into the database are treated with respect and courtesy. The research should be non-maleficence, which means that no harm will come to the subjects through the research process or the procedures used in the study. For example health information which is put to use in a harmful way can affects person’s employment status.

Another principle issue is the confidentiality of information and respect for privacy. This issue is closely linked to the advances of technology. In the world we live in today it has become progressively easy to pass on information using the internet or USB sticks for example. It is also simple to add extra information to a person’s database profile by adding a few extra fields. This may however not always agree with the confidentiality and privacy of that particular person. Whoever has access to the database is able to access information which isn’t always relevant to original intended purpose.

The principle of autonomy must also be considered when creating a database. When personal information is lost or compromised a person’s values may be at stake. The information could circulate in societal or business environments and potentially cause harm to the owner.

However if an informed consent is used before collecting data from the customer there is no infringement of autonomy. A consent allows the researcher to collect personal information from the customer knowing that he has given his permission.

To conclude it can be said that the progress of technology has caused an increase for concern over ethical issues. Technology provides a wide range of options allowing information to be transferred on mass scales.