Customer relationship management (CRM) is a term applied to processes implemented by a company to handle its contact with its customers. CRM software is used to support these processes, storing information on current and prospective customers. Information in the system can be accessed and entered by employees in different departments, such as sales, marketing, customer service, training, professional development, performance management, human resource development, and compensation. Details on any customer contacts can also be stored in the system. The rationale behind this approach is to improve services provided directly to customers and to use the information in the system for targeted marketing

While the term is generally used to refer to a software-based approach to handling customer relationships, most CRM software vendors stress that a successful CRM strategy requires a holistic approach. CRM initiatives often fail because implementation was limited to software installation without providing the appropriate motivations for employees to learn, provide input, and take full advantage of the information systems.

From the outside, customers interacting with a company perceive the business as a single entity, despite often interacting with a variety of employees in different roles and departments. CRM is a combination of policies, processes, and strategies implemented by a company that unify its customer interaction and provides a mechanism for tracking customer information.

CRM includes many aspects which relate directly to one another:

• Front office operations — Direct interaction with customers, e.g. face to face meetings, phone calls, e-mail, online services etc.
• Back office operations — Operations that ultimately affect the activities of the front office (e.g., billing, maintenance, planning, marketing, advertising, finance, manufacturing, etc.)
• Business relationships — Interaction with other companies and partners, such as suppliers/vendors and retail outlets/distributors, industry networks (lobbying groups, trade associations). This external network supports front and back office activities.
• Analysis — Key CRM data can be analyzed in order to plan target-marketing campaigns, conceive business strategies, and judge the success of CRM activities (e.g., market share, number and types of customers, revenue, profitability).