New Trends and Issues

This study focuses on understanding the application of knowledge management practices as strategies of customer relationship management by managers in hospitality industry in Vietnam. Thirty in-depth interviews with managers and executives who are involved in tourism-related activities in small and medium enterprises (SMEs) in tourism industry in different destinations in Vietnam facilitated the analysis. The analysis was carried out in the light of grounded theory. The analysis indicated that the use of customer relationship management (CRM) strategies in SMEs in tourism industry is at a moderate level. Yet, the performance of personalities who are involved in CRM activities in their jobs is intervened by knowledge management and dynamic capabilities. Precisely, while knowledge management mediates, dynamic capabilities moderate the relationship between CRM and performance of SMEs in tourism industry in Vietnam


Background of the study
According to principles of marketing management, business strategy of service-oriented organisations is mostly based on customer and customer satisfaction (Kotler, 2012).Rather than attracting, retaining the same customer base has become critical for long-term sustainability of service-oriented firms, as the business environment is highly competitive (Young et al., 2008).Nowadays, customer relationship management (CRM) is serving as the main strategy for attracting and preserving customers in many service-oriented organisations.CRM has been defined in various ways.Lawson-Body & Limayem (2004) refer CRM as organisational tasks directed towards long-term sustainable relationships that enable customer attraction and retention in the enterprise.Information, human resource and technology have been identified as major component of CRM.Meantime, intellectual capital like 'knowledge' of the organisation is playing major role in the implementation of effective CRM strategy which is based on participatory approach (Finnegan & Currie, 2010).As a result, the term 'knowledge resources' are often used in CRM research studies, and knowledge management is dominating in every corner of organisational studies.
Twenty-first century has forced industries oriented in both products and services to remain competitive enough gaining sustainable advantages over similar firms through knowledge management.As a result, many industries have given priority for 'knowledge resources' over 'other resources' (Bock & Kim, 2002).Accordingly, individual industries tend to prepare their strategic, tactical and action plans based on knowledge resources, highlighting management of knowledge in the firm.Service-oriented firms are critical in management of knowledge as such firms interact with customers regularly.Meeting the customer on the spot where service is delivered has made serviceoriented industries more competitive.Tourism as the fastest growing service industry in the world is recognised as the potential income-generating source for a country.Therefore, identification of business practices, emerging themes and development of new concepts would make the industry and academia beneficiary.Newly emerging popular destinations like Vietnam have grasped much attention from scholars due to radical changes in the economy.According to research by the Pacific Asia Travel Association and the Visa International Company (VISA) in 2010, travelling to Vietnam is becoming a more desirable and popular option for international tourists, particularly for tourists from China, Thailand, Japan, Singapore and Australia.However, due to the ineffective promotional strategy according to report at the World Economic Forum's 2011, the attractiveness of Vietnamese tourism destination is still under its potential.Considering limited research studies of CRM in case of tourism industry and small and medium enterprises (SMEs), this study focuses to understand the application of knowledge management practices as strategies for implementing CRM by managers in hospitality industry in Vietnam.
The remainder of the paper is classified into four sections.Section 2 reviews the literature about CRM and Knowledge Management in the case of service-based industries.Methodology of the study is given in Section 3. Data analysis and discussion is provided in Section 4. Finally, conclusion is provided in Section 5.

Customer relationship management
Previous studies (Zablah et al., 2004;Garrido-Moreno et al., 2015) reveal that CRM is widely accepted as a business strategy that involves people, processes and technology with the aim of establishing and fostering relationship with customers.In particular, the power of technology enables CRM to collect and store valuable amounts of customer data (i.e., needs, motivation and behaviours) and then create knowledge for increasing competitiveness and improving performance (Zablah et al., 2004).Thus, the success of this process is mainly based on the technology infrastructure and the wealth of knowledge.CRM is generally classified into three types of systems (Gebert et al., 2003), namely operational CRM systems, analytical CRM systems and collaborative CRM systems.

Knowledge management
On the resource-based view, Nonaka and Takeuchi (1995) argued that knowledge is a precious source that firms should accumulate and leverage for facilitating continuous innovation and then create competitive advantages that other competitors cannot imitate.Also, knowledge is divided into two types: 1) tacit knowledge, which is more invisible, subjective and less expressible, and 2) explicit knowledge, which is described to be coded, stored and transmitted easily (Nonaka & Takeuchi, 1995).During the business processes of firms, both tacit and explicit knowledge are utilised to achieve organisational goals.
Knowledge management (KM) has been defined as a process of acquiring, storing, transferring and applying collective knowledge within an organisation so that employees can utilise it for the organisational success (Nonaka, 1994;Alavi & Leidner, 2001;Zack et al., 2009).In particular, the KM framework consists of four sets: 1) knowledge creation, in which the content of knowledge is developed or replaced, 2) knowledge storage, where knowledge is stored in organisational and individual memory, 3) knowledge transfer, which happens in all levels of organisation, and 4) knowledge application, which turns knowledge into competitive advantage (Alavi & Leidner, 2001).Simply, knowledge flows in KM are implemented in various departments and transformed into competitive resource for firms to compete in market.

KM as a strategy of CRM
In term of knowledge, CRM and KM are strongly associated with each other, because knowledge in both processes is mainly customer-related (Romano, 2000).Therefore, as a consequence of implementing KM, customer knowledge flows is supposed to improve the performance of CRM.With regard to customer-centric approach, customer-related knowledge in CRM processes can be classified into three categories (Gebert et al., 2003).Knowledge for customers includes knowledge about products, suppliers and producers, which are required in CRM processes to meet customers' requirements.Knowledge about a customer involves knowledge about customers' purchasing histories, needs and behaviours, which significantly consume time to acquire and analyse in the CRM process.However, this knowledge is highly valuable for understanding customers better and translating it into competitive advantages.Knowledge from customers consists of customers' knowledge of products, suppliers and markets as knowledge for customers.CRM process enables organisations interact with customers to gain more knowledge for continuous improvement Some previous researches pointed out that KM is linked positively to the performance of CRM (i.e., Campbell, 2003;Lei & Tang, 2005;Hasanian et al., 2015).Empirically, KM obtains, analyses customer knowledge and create knowledge competence so that CRM is able to communicate customers, understand their requirements better, as well as enhance the source of competitive advantages (Campbell, 2003).KM is found as the main factor fostering the management of customer relationships effectively through the creation, distribution and application of customer knowledge (Lei & Tang, 2005).Moreover, among KM factors, for instance: organisational infrastructure, technology and leadership, KM process was demonstrated consistently as the main predictor which positively influences on customer acquisition, retention and customer satisfaction and, ultimately, the productivity of CRM process (Hasanian et al., 2015).
One research contributing significantly to the literature of KM and CRM is the customer knowledge management (CKM) model (Gebert et al., 2003).The proposed model takes advantages of four aspects of knowledge, including content, competence, collaboration and composition in order to improve the CRM performance.In the finding, utilising CKM is proved to optimise the opportunities and push the performance improvements with the positive result of case study in a large mutual fund company.
Notwithstanding, there is little empirical evidence concerning this idea, especially in the tourism field, and so this study will investigate qualitatively how KM influences the performance of CRM as a strategy.

Methods
Because of the lacking of adequate background theories for CRM implementations in SMEs, the main goal of this study is to develop new theories that can help explain partly the phenomena and open new area of researches about the topic.In this sense, grounded theory as a research method that allows the simultaneousness of data analysis and data collection can be truly useful and appropriate for this study.Grounded theory also allows the involvement of rich contexts around the main issues into the investigations (O'Reilly et al., 2012).Using the adaption of qualitative grounded theory approach (Glaser and Strauss, 1967), the data collection is conducted mainly through deep interviews with managers and executives in SMEs in tourism industry in Vietnam.
The total 30 in-depth interviews in about 1 to 2 hours are conducted over the period of 3 months in 2016 in different tourism destinations in Vietnam.Because the overarching objective of grounded theory method is to let the researched concepts emerge from simultaneously analysing and collecting data, we divided the in-depth interviews processes into two phases.The first phase focuses on very basic questions about the CRM and others contextual factors such as financial and human resources, the willingness of top managers or business strategy, etc.The second phase will depend on the data analysis after the end of the first one to decide which emerged concepts or issues need to be investigated more.Consequently, the first phase and second phase included 12 in-depth interviews and 18 in-depth interviews accordingly.
The main participants in deep interviews are mainly general managers.In some cases, interviews are conducted with front-office managers, human resources managers or customer care executives.These participants are arguably appropriate for the inquiries since their thorough expertise in customer strategy.The type of SMEs regarding size and business areas are selected based on the diversification principle and theoretical sampling technique.Table 1 presents the in-depth interview participants, company descriptions, location and year of experiences.

CRM usages and implementations in SMEs
In the first round of the in-depth interviews, the use of CRM and how it is implemented are the main aims.The results of this round are expected to form solid foundations for finding the factors enabling the successful implementation of CRM in SMEs in tourism industry.From our analysis, the first and quite interesting finding here is about the understanding of CRM concepts between the managers and executives interviewed.There are distinctly different views about CRM among them.L.A., front-office managers who worked for S.B. resorts for almost 5 years, comments that she had never done serious research on CRM, but she has used it for mainly improving the customer services.She said: 'We started to realize the immense role of good relationship with customers a few years ago.And since then, we are keen on using CRM to improve our customer processes.We would like to understand more about our customers and make them satisfied as much as possible with our products and services.However, we cannot change all the business processes for this objective.The main function of CRM is to solve customer problems, keep good relationship with them and front office is the department which is mainly responsible for that.' The view of L.A. about CRM is shared by most of the managers and executives in SMEs in this study.The uses of CRM in most of the SMEs in our survey are for initiating, maintaining and terminating relationship with customers.Within this view, the most important and frequently used components of CRM are customer care initiatives and marketing campaign enhancements.However, the magnitudes of using these components also somewhat vary from firm to firm depending on their customer strategy, human and financial resources and capability of collecting customer information.Most of the companies in this group use traditional customer care programs, including after-sales promotions, loyalty memberships or general marketing messages communication to most of customers.In contrast, companies that concentrate on diversifying their customer base usually invested heavily in system for collecting customer information.They also often have more extensive training program for their employees.By using additional customer knowledge extracted from the information collected, the customer care initiatives in these companies focus more on the details and customised services/products for satisfying specific needs of customers.Usually, these companies have available and committed financial resources to innovate or add more added value services/products to their portfolio to adapt with customer demands and for competing with other competitors.However, Mrs. A.N., general manager in A.B. resorts, insisted that building the right mind set for employees about customer relationships is the most crucial task that determines the effectiveness in customer processes; he said: 'We have established the system for collecting customer information long time ago but it took us a long time to completely persuade our employees to put customer information they have when encountering with customers in the right manners.Since then, we started to know which type of customers that we should be focused on to send our offers and which kind of messages we should send to them.'There are a few exceptional SMEs in our survey that pursue the CRM approach as a cross-functional strategic business process.In this case, CRM implementation requests to transforms all firms' activities from product-centric orientation towards customer-centric orientation.In these companies, the responsibility for satisfying customers and developing long-term relationship with them does not only belong to the front-office or customer care department or specific departments.All departments in the organisations have their own share in building and maintaining relationship with customers.These few companies are able to employ the cross-functional approach when dealing with customer problems.They also have huge commitment from leaders for pursuing customer-centric orientation and significant investments in time, human and financial resources to build internal systems.The rewards are worth the efforts; CRM implementation in these companies is much more effective with above average customer and financial performance.Especially, they rooted their superior customer performance in their ability to really customise and personalise their services by cooperating with customer in designing their offers.Mr. M.T., general manager of B.V. resorts, which is in the market for more than 18 years, said: 'We are different from most of others by having multiple channels to communicate with our customers so that the opportunities to strengthen the relationships are much more and the mutual understanding between companies and customers is deeper.[…] In addition, our strengths are not from any specific factors like exceptional customer cares but they are come from the smooth cooperation between many departments and employees, both front office or back office to maximizing positive customer experiences with our companies.'Even though huge efforts are needed to be spent, the paths for achieving this type of strategic CRM can be quite different.However, Mrs. H.T., front-office manager in hotels and resorts S.L., insisted that human factors are still the one determining the success of CRM implementation; she described that: 'We already have […] and everything is in place, but we are young companies and both managers and employees have not been in any experienced like this before.Thus, it took us a lot of lessons to know what exactly we need to do about the CRM system.[…] .We have prepared all the hardware but the software which is human knowledge to run the system is not ready yet.'Some new SMEs can build up all the system from scratch based on their strong financial resources.A few other SMEs choose the path of incremental innovation to upgrade their system until it satisfies all requirements to have the type of strategic CRM.In these SMEs, the key factors that help them differentiate from the previous group of SMEs are the hard commitment of top management teams and the stable of human forces that help to maintain high-quality services and customer relationships.Especially, some SMEs having very little innovations over years and almost no financial sources for radical innovating still have strong customer performance and financial performance.This phenomenon can be explained by their unique ways to create strong emotional bond with their key targeted customers.Mr. T.T., general manager of resorts S.V., explained that: '[…], and more than 70% employees stay with us for more than 3 years.Thus, they know how to contribute the best to both our customers and to the firms.They understand clearly the way company works and autonomously know how to help customers with their issues or enrich the customer experiences by their special expertise or their network of experts within the companies.' Clearly, human factors have risen as a critical factor for successful CRM implementation.Specifically, the embedded know-how and knowledge in employees and managers play the decisive roles in transferring the CRM efforts in to superior customer performance and financial performance.Accordingly, the second round of deep interviews focused on the role of KM in CRM implementation.

KM as a mediator
Asking most of the managers and executives, they truly regard the knowledge and know-how in service industry, especially in the tourism industry, as the most valuable assets.However, there are differences in the types of knowledge that managers would like to exploit to build up their competitive advantage.Mrs. D.V., who has just been appointed as the general manager in hotel H.L., urges that the first thing she would like to change when she first came to the hotel is the way how it captures and uses knowledge; she said: 'When I first came here, […] knowledge is not the focus here, especially tacit knowledge about customers and markets.Then, we started to establish business processes for capturing important customer information and extracting knowledge for supporting decision making.'Hotel H.L. is among the very few cases that put their focus on capturing tacit knowledge about customers with official business processes.Most of other firms, regardless of size and resources, pay more attention on training employees about explicit knowledge on their necessary skill sets.In addition, only two companies that are medium-size resorts emphasised the importance of knowledge about markets, macroeconomics and competitors in their process of decision-making.Other managers mostly based on their judgments, experiences or their entrepreneurial capability to look for the changes in market trend and structures.Mr. M.H., who is general manager of one of the two mentioned companies, argued that judgments of managers are too subjective and they need other learning mechanisms to help with essential decision in customer and business strategy; he said: 'We realize the important […] and knowing the right things to serve customers is much more important on how effective we serve them.For achieving this, all information and knowledge extracted about not only customer but also markets, competitors, regardless of facts or concepts need to be collected and filtered.We do it through many channels and through many departments.'It is not surprise that these two companies are among the few companies that pursue the strategic CRM implementation and having superior customer and financial performance.Not only the range of knowledge is wider for implementing strategic CRM, but also the knowledge is much more accessible to the real users.The tacit knowledge that is required for competing with competitors is certainly crucial to any SMEs, but the way employees can access it might make the difference in customer and financial performance.In smaller companies and some of medium companies, only top management team and sales departments are accessible to the tacit knowledge about customers.The knowledgesharing practices happen mainly from direct encounters between employees and the sources of knowledge occasionally.Therefore, it depends much on the attitude of individual employees to possess the knowledge required for satisfying customers.This practice limits the usefulness of customer knowledge because it is not transferred smoothly and frequently to the real users, employees, who encounter often and directly with customers.When employees lack necessary knowledge or do not know where to find the sources of knowledge, they are much more conservative in their actions to enhance customer experiences.Thus, the emotional bonds between companies and customers are very weak.Ms. Ch., customer care executive in a medium-size travel agency F.D., said that: 'Customer usually […] and on some occasion, they want me to consult the details in services and products in some other departments.I really need the expertise from other colleagues, but there is no clue who specifically I should contact for a particular problem.[…].We work too independently from each other.'From our analysis, knowledge sharing depends largely on the customer strategy and the willingness of top managers.The willingness of top managers, if communicated effectively, can build the company culture where employees understand why they need to cooperate with each other to satisfy customers.Moreover, contrasting with usual norms in business, the financial resource is not the crucial constraint here for building the effective knowledge sharing practices.Mr. V.D., general manager in medium-size resorts S.H., explained that: 'We are not ambitious with our knowledge sharing system.We use very basic tools such as email, memo, log book, chat group, internal network for communicating with each other and between departments.These don't cost a big amount to invest.[…] we encourage employees to use it in the right manner and repeat it frequently enough until they form the habit to use them to easily know where to find the people they need for specific problems to satisfy customers.'

Dynamic capability as a moderator and proposed framework
In our analysis, we also noticed that some of the best SMEs in terms of customer and financial performance in our survey have in common another use of KM to improve its impact on CRM implementation.The KM is found to be most effective when they help not only to know about customers but also to provide enough knowledge for forecasting the significant changes in market trend to some extent.These forecasts are the primary inputs to enable one of the most important capabilities nowadays in any firm, dynamic capability (DC).The focus of DC is on 'how firms can extend or modify their resources and/or specific assets, as they sense and create, seize and accept opportunities while simultaneously managing competitive threats, and effectuate necessary transformations' (Teece, 2007).For simple approach, Wang and Ahmed (2007) conduct a review of dynamic capability (DC) and identify three strategic processes defining as the determinant factors for successful DC application, which are adaptive capability, absorptive capability and innovative capability.Most SMEs are limited by their human and financial resources to follow the continuously innovating strategy which is the ultimate objective of the dynamic capability.However, dynamic capability is not exactly innovation.For SMEs, the focus here is how firms improve their adaptive capability to proactively adapt with changes in market and customers to take advantage of opportunities or at least prevent the severe damage to their core business.Mr. H.A., general manager in medium-size travel agency, argues that: 'We know that […] and changes are inevitable.For medium company like us, the optimal choice is to follow very closely the rhythm of the markets and customers by building our learning or absorptive mechanism through many channels.We prefer an incremental innovation because we don't have enough resources and flexibilities for a dramatic change in a short time.We frequently update our business plan and always try to refresh our self to be as closer as possible to the trend in order to survive through difficult times and try to catch up the trend in the long-term.It will take time but at least we try.' In addition, in the best SMEs, the common patterns can be observed.Based on our findings, we proposed a framework that can be used as a general guide for effective CRM implementation in SMEs in the services and tourism industry.In this framework, KM plays the mediating role on the relationship between CRM and firm performance.Moreover, the dynamic capabilities moderate the relationship between CRM, KM and firm performance.The more dynamic capabilities a company possesses, the stronger the linkages between CRM, KM and firm performance.The framework is presented in Figure 1.

Conclusion
This study reviews the application of KM practices as strategies of CRM in tourism industry in Vietnam.The analysis indicated that the use of CRM strategies in SMEs in tourism industry in Vietnam is at a moderate level.However, the performance of personalities who are involved in CRM activities in their jobs is intervened by KM and dynamic capabilities.Precisely, while knowledge sharing mediates, dynamic capabilities is moderated by the relationship between CRM and performance of personalities in tourism industry in Vietnam.This was a good indication of personalities who are working in tourism industry that KM and dynamic capabilities are playing a critical role in the case of performance and CRM.These findings should be interpreted with limitations.Sample size, respondents (only executives and managers from SMEs, but not customers) and location of SMEs (Only a few tourism popular destinations, not covered the whole country) limited the study interpretation of study findings.Future research can focus to study about CRM eliminating one of the above limitations.

Table 1 . In-depth interview participants Pseudonym -position Year experiences Company descriptions Pseudonym - position Year experience
* GM: General Manager; FM: Front-Office Manager; HM: Human Resource Manager; CE: Customer Executive; COO: Chief Operation Officer.Source: Own research