Customer relationship management provides the structure for how the relationships with customers
will be developed and maintained. Management identifies key customers and customer groups to
be targeted as part of the firm's business mission. The goal is to segment customers based on
their value over time and increase customer loyalty by providing customized products and services.
Cross-functional customer teams tailor Product and Service Agreements (PSA) to meet the needs of key
accounts and for segments of other customers. The PSAs specify levels of performance.
The teams work with key customers to improve processes and eliminate demand variability and
non-value-added activities. Performance reports are designed to measure the profitability of
individual customers as well as the financial impact on the customer.
cf. Douglas M. Lambert and Terrance L. Pohlen, "Supply Chain Metrics," The International Journal of Logistics Management, Vol. 12, No. 1, (2001), pp. 1-19.