THE DETERMINANTS OF CRM EFFICIENCY IN EMERGING MARKETS: EVIDENCE FROM THE BANKING SECTOR IN SINDH, PAKISTAN

Abstract

This study examines the effectiveness of Customer Relationship Management (CRM) systems in the banking sector of Sindh, Pakistan. It addresses a key concern: many banks are not fully aligning their CRM strategies with the fast-changing dynamics of the banking industry and often lack clarity on the factors that contribute to successful CRM implementation. A qualitative approach was adopted, using semi-structured interviews with personnel responsible for developing and executing CRM strategies in commercial banks across Karachi, Hyderabad, and Sukkur. Thematic analysis was applied to identify the major patterns and insights emerging from the data. Findings reveal that although some determinants of CRM success are consistent with those observed in developed markets, Pakistan’s unique cultural and institutional environment requires banks to adapt CRM practices to local conditions. Important factors influencing CRM effectiveness include the integration of multiple communication channels, organizational structure, employee training and recruitment, customer information management, and sensitivity to cultural and social dynamics. The study also introduces two practical contributions: a CRM readiness heat map that helps banks evaluate their preparedness for CRM implementation, and a CRM Index developed from 16 sub-themes to assess CRM performance across organizational, institutional, and customer data dimensions. Grounded in Contingency Theory, Institutional Theory, and Hofstede’s cultural dimensions, this research offers valuable insights for academics and practitioners seeking to enhance CRM performance in emerging markets.