How Customer Relationship Management (CRM) and Innovation Influence Business Performance Mediating Role of Innovation

According to Bain & Company, CRM is at the top of management tools in recent years. This article aims to answer the productivity paradox of CRM and investigates the impact of both CRM and innovation on firm performance and also investigating mediating role of innovation to explain the effect of CRM on performance. To obtain research objective, an empirical study was conducted. For evaluating conceptual model, survey instrument was developed. The relationship between dimensions of CRM and innovation, as well as the relationship between innovation and business performance, were approved, but direct relationship between dimensions of CRM and business performance, according to the data collected, was not approved. Innovation and CRM both are valuable capabilities, which are viewed necessary to achieve a competitive advantage. However, there are little researches about how the interaction of these two concepts improve performance, and despite massive investments in the field of CRM, its impact on business is ambiguous.