1. Trang Chủ
  2. Quản lý dự án
  3. The effect of customer relationship management on customer satisfaction: empirical evidence from star rated hotels in Amhara Region, Ethiopia

The effect of customer relationship management on customer satisfaction: empirical evidence from star rated hotels in Amhara Region, Ethiopia

The main objective of this research was to examine the influence of CRM on customer satisfaction. The research was focused on three and above three star rated hotels in Amhara Region, Ethiopia. International Journal of Management (IJM) Volume 11, Issue 5, May 2020, pp. 550-567, Article ID: IJM_11_05_050 Available online at http://www.iaeme.com/ijm/issues.asp?JType=IJM&VType=11&IType=5 Journal Impact Factor (2020): 10.1471 (Calculated by GISI) www.jifactor.com ISSN Print: 0976-6502 and ISSN Onlin

Thể loại Tài liệu miễn phí Quản lý dự án

Số trang 18

Ngày tạo 6/18/2020 1:12:58 PM +00:00

Loại tệp PDF

Kích thước 0.36 M

Tên tệp

Tải The effect of customer relationship management on ... (.pdf)

Xem mẫu

  1. International Journal of Management (IJM) Volume 11, Issue 5, May 2020, pp. 550-567, Article ID: IJM_11_05_050 Available online at http://www.iaeme.com/ijm/issues.asp?JType=IJM&VType=11&IType=5 Journal Impact Factor (2020): 10.1471 (Calculated by GISI) www.jifactor.com ISSN Print: 0976-6502 and ISSN Online: 0976-6510 DOI: 10.34218/IJM.11.5.2020.050 © IAEME Publication Scopus Indexed THE EFFECT OF CUSTOMER RELATIONSHIP MANAGEMENT ON CUSTOMER SATISFACTION: EMPIRICAL EVIDENCE FROM STAR RATED HOTELS IN AMHARA REGION, ETHIOPIA Simachew Zeleke* Ph.D Scholar, School of Management Studies, Jawaharlal Nehru Technological University - JNTU Hyderabad, Telangana, India Dr. A. Prabhu Kumar Professor & Director, School of Management Studies, Jawaharlal Nehru Technological University - JNTU Hyderabad, Telangana, India *Corresponding Author Email: simachewzele@gmail.com ABSTRACT As far as customers are the means of the existence of business organizations, customer relationship management is the exclusive weapon to win customers confidence and keep sustainable competitive advantage. CRM implementation in the hotel industry is an ongoing phenomenon as long as there is tough competition in the industry. The main objective of this research was to examine the influence of CRM on customer satisfaction. The research was focused on three and above three star rated hotels in Amhara Region, Ethiopia. The basic drive force of the researcher in this particular area was that the region has tremendous tourism destination in which hospitality business accompaniments required. Therefore, CRM issue and customer satisfaction in the hotel industry was an agenda for the researcher. Self-administered questionnaire in the form of 5 point Likert scale was the primary data collection instrument. 260 Hotel guests who stayed in the hotel, at least one night and more, during data collection had been selected at check-in time via stratified random sampling. Pearson correlation coefficient, ANOVA and multiple regression model were the inferential part of data analysis. SPSS version 23 was applied for data entry and presentation. All measures of CRM (people, technology, process and strategy) had positive relationship to customer satisfaction. People and strategy measures had positive and statistically significant contribution to customer satisfaction whereas technology and process measures had negative but statistically insignificant http://www.iaeme.com/IJM/index.asp 550 editor@iaeme.com
  2. The Effect of Customer Relationship Management on Customer Satisfaction: Empirical Evidence from Star Rated Hotels in Amhara Region, Ethiopia contribution. People element in these hotels was the best predictor of customer satisfaction. Key words: CRM, Hotel industry, Star rated hotels; Hospitality, Customer satisfaction Cite this Article: Simachew Zeleke and Dr. A. Prabhu Kumar, The Effect of Customer Relationship Management on Customer Satisfaction: Empirical Evidence from Star Rated Hotels in Amhara Region, Ethiopia. International Journal of Management, 11 (5), 2020, pp. 550-567. http://www.iaeme.com/IJM/issues.asp?JType=IJM&VType=11&IType=5 1. INTRODUCTION Around the world the service sector of the economy is growing through a period of just about revolutionary change during which established ways of doing business still be shunted aside. This sector has been contributing tons for employment opportunities, eradicating countries from poverty, and increasing countries’ GDP. Unfortunately, customers are not always proud of the standard and value of the services they receive. People complain about late deliveries, rude or incompetent personnel, inconvenient service hours, poor performance, needlessly complicated procedures and a number of other problems (Christopher H. Lovelock, Jochen Wirtz, 2011). Customer relationship management (CRM) is one among the organizations effective strategic tool for his or her success like strategic planning (Darrel, R. 2017). In today’s competitive business world, CRM is one among the key success factors and methods most companies deployed to realize competitive advantage (Rajesh & Manivannan, 2013; Eid El- Gohary, 2014 and Vallabh et al., 2015). CRM is an abbreviation for Customer Relationship Management, not Customer Relationship Marketing which needs organizational and business level approaches – which are customer centric – to doing business instead of an easy marketing strategy. The last several years saw the increase of customer relationship management as a crucial business approach. The objectives of CRM is that the paradigm shift from mass marketing to individual (one-to- one) marketing to make long lasting relationship with customers through the utilization of information technology (Paul Gray and Jongbok Byun, 2001). Customer relationship management (CRM) is one among those magnificent concepts that swept the business world with the promise of forever changing the way businesses are done across the world. It is increasingly found at the upper level of organizations agenda. Companies large and small across a spread of sectors are embracing CRM as a serious element of corporate strategy for two important reasons: new technologies now enable companies to focus on chosen market segments, micro-segments or individual customers more precisely and new marketing thinking has recognized the restrictions of traditional marketing and therefore the potential of more customer-focused, one to one marketing, mass customization and process-based strategies. It is a business approach that seeks to make, develop and enhance future relationships with carefully targeted customers so as to enhance customer value and company profitability and thereby maximize market share and shareholder value (Adrian Payne, 2005). Customer relationship management (CRM) can be the exclusive and powerful weapon to ensure customer satisfaction and loyalty. It is also a nonnegotiable business strategy in today’s business situation for customers connecting electronically or face to face and for both internal and external customers from across the world or town (Anderson and Kerr, 2002). http://www.iaeme.com/IJM/index.asp 551 editor@iaeme.com
  3. Simachew Zeleke and Dr. A. Prabhu Kumar Different firms view customer relationship management in various ways. Some considered it as a software technology, some others viewed like data base marketing and still others understood like one to one marketing and call center. But customer relationship management is the overall integrated and holistic business approach which focuses on customers to strengthening and developing full knowledge about customer behavior and preferences to develop the programs and strategies that continually enhance their business relationship with the company (Goodhue, Wixom, and Watson, 2002; Adrian Payne, 2005; Zablah, Bellenger, and Johnston 2004). The objective of CRM is to recognize and treat each and every customer as an individual as well as attract and retain customers. Any business must have to know how to differentiate customer treatment according to individual preferences. For differentiating customer treatment and pouring purchases higher, the companies should offer personalized service and customized products. Getting closer to customers and effectively responding to their needs is a great way to advance their devotion and initiate deeper business relationship. Most companies believe as they are being customer-focused and believing that they serve the customer in proper manner. But eventually, being customer focused means to have a reliable, dependable and convenient interaction with customers in every point of sale. CRM technologies specialize in managing all interactions that a corporation has with its client, so as to influence the information during a sort of business applications. Where a profitable relationship already exists, CRM can especially, boost superior service at a lower cost (Patrick and Ameer, 2005). 1.1. Hotel Background in Ethiopia and Amhara State The hotel business nowadays has been recognized as a worldwide business, with producers and consumers spread around the world. Aside from the expansion of domestic hotels, international hotels are expanding through franchise like Marriot, Sheraton, Radisson Blue, and Hyatt Regency. Hotel amenities like room decoration, bar & restaurant services, nightclub, sport bar, internet café has been becoming the daily and integral part of human life. Moreover, within the last three decades, demand for and provide of hospitality services beyond that of the normal services intended for travelers have escalated the expansion of the hospitality industry globally, resulting in intense competition within the market-place. One among the simplest challenges facing hotel organizations nowadays is that the ever-growing volume and pace of competition. Competition has had major implications for the client, providing increased choice, greater value for money and augmented levels of service. According to UNWTO (2015) different criteria have been used to classify hotels. One of the classifications of hotels is relying on the stars they have. Hotels having same rate levels have probably similar characteristics and fulfill similar criteria; additionally, there is little to differentiate one hotel’s products and services from another. Thus it has become imperative for hotel organizations to realize a competitive advantage. There are two strategies most ordinarily employed by hotel managers so as to realize a competitive advantage, which are low-cost leadership through price discounting and developing customer loyalty by providing unique benefits to customers. Hotels that plan to improve their market share by discounting price run the intense risk of getting a negative impact on the hotel’s medium- and long-term profitability. As a result, it is quality of service and relationship instead of price that has become the key to a hotel’s ability to differentiate itself from its competitors and to realize customer loyalty. Until recently, Ethiopia did not have enough hotels recognized under international rankings or ratings – they generously awarded themselves their own stars. This made it hard for visitors to gauge the standard of a hotel. This changed in 2015 when the Ethiopian http://www.iaeme.com/IJM/index.asp 552 editor@iaeme.com
  4. The Effect of Customer Relationship Management on Customer Satisfaction: Empirical Evidence from Star Rated Hotels in Amhara Region, Ethiopia government, with the assistance of United Nation World Tourism Organization (UNWTO), started rating hotels within the country. Six experts from UNWTO and 200 experts from Ethiopia jointly establish criteria and actual assessment for the rating. The association of hotel owners also had active participation during the standards which has 12 parameters. Parameters within the criteria template are: exterior view, bedroom, bathroom, public area, bar and dining facilities, kitchen, housekeeping & maintenance, general services, additional facilities like swimming bath, gym, and spa, sustainability (research and development), safety & security, staff facility and training including staff recreation area (Addis Fortune, Published on August 21, 2015). Though participation in the grading process is mandatory, the graded hotels still have not undergone annual audits to make sure that they are maintaining with the standard they were awarded. 2. JUSTIFICATION OF THE STUDY In the hotel industry, there is high and stiff competition because the essential products (rooms) are very closely similar. When comparing hotels with an equivalent quality level and same price charge, the opposite soft factors like close relationship, personal treatment; personalization and one to one marketing are going to be the bases for differentiation. To enhance profitability and guest satisfaction, hotels nowadays specialize in implementing different strategies that aim to hunt, gather and store the right information, validate and share it throughout the entire organization and then use it in all organizational levels for creating personalized and unique guests’ experiences (Roya Rahimi, 2017). Customer satisfaction and loyalty occurs when customers find a particular company to be more responsive and more in touch with their specific needs. If their need is satisfied, customers will come back again and customer retention, which is valuable for both business and customers, will achieve. For business it is cheaper to keep existing customers happy than to attract new ones. Dyche (2002) stated that five-percent increase in customer retention leads to a 25 to 95 percent increase in profits; and also it costs a company six times more to sell a product to a new customer than it does to sell to an existing one. Nowadays, the hotel industry is boosting; as a consequence users have many choices to prefer and as a result of this, they are focusing on the quality of service. So to be competitive in the flourishing market, CRM is the exclusive solution. However, Customer relationship management implementation, particularly in hotel industry, is very challenging. A successful CRM strategy cannot be implemented by only installing and integrating software packages, it needs coordination along with the people, business process, and strategy and customer acceptance. Based on the extensive literature review the following research gaps are articulated:  From the extensive literature review, it was found that the studies on CRM and its function with customer satisfaction in Ethiopia context are very limited. In fact, CRM and its relation with customer behavior such as satisfaction remained a new area to investigate in Ethiopian scenario.  Earlier studies have focused on banks, airlines and telecom giving a little bit room to study CRM. As hotel industry is a growing industry in Ethiopia and has a great contribution to tourism and travel industry, a study of CRM demands more attention and significance.  Most CRM researches are done on big companies and international and franchise hotels. Moreover, most of them are in developed nations; which lack comprehensive and holistic scenario about CRM. Therefore, this study focused on private and independently owned hotels found in a developing nation (Ethiopia). http://www.iaeme.com/IJM/index.asp 553 editor@iaeme.com
  5. Simachew Zeleke and Dr. A. Prabhu Kumar Therefore, the researcher addressed the above research gap through the following basic research questions:  How is the relationship between CRM dimensions and customer satisfaction in the study area?  How well do the four measures of CRM (people, technology, process and strategy) predict customer satisfaction in three and above three star hotels?  Which is the best predictor of customer satisfaction in three and above three star hotels: people, technology, process or strategy? 3. RESEARCH OBJECTIVES  To analyze the relationship between CRM and customer satisfaction.  To examine the effect of CRM on customer satisfaction in the study area.  To determine the relative importance of CRM dimensions over customer satisfaction in three and above three star Hotels. 4. LITERATURE REVIEW 4.1. CRM Definition Every business unit emphasizes on maintaining a long term relationship with customers to nurture its stability in today’s turbulent and competitive market arena. Customer’s expectations are not any longer solely restricted to induce best product and services, they also need a face-to-face business during which they need to receive exactly what they demand and in a quick time. Different people and company viewed CRM from different perspectives. Information technology companies viewed it as a software or IT which supports the business activities whereas others viewed from marketing and management perspective as a business strategy which consider customer centric approach to acquire, satisfy and retain profitable customers. Francis Buttle (2009), identified four types of CRM to explain and elaborate the definitions of CRM. These are: strategic CRM, operational CRM, analytical and collaborative CRM. Strategic CRM: It is focused upon the event of customer centric business culture to win and keep customers by creating and delivering superior value than competitors. It is as an enterprise wide strategy during which the most focus is on the customer. It is also assumed that, within an enterprise, it is a core managerial task to champion and implement this focus as a CRM strategy. The systematic analysis and use of customer information as a platform for marketing and management could be included in the strategy. Operational CRM (Front office): It automates and improving customer facing and customer supporting business process (like marketing, selling and service) through CRM software. Analytical CRM (Back office): It is concerned with capturing, storing, extracting, integrating, processing, interpreting, distributing, using and reporting customer related data to enhance both customer and company value. Analytical CRM builds on the inspiration of customer-related information. Customer-related data could also be found in enterprise-wide repositories: sales data (purchase history), financial data (payment history, credit score), marketing data (campaign response, loyalty scheme data) and service data. The data are often collected from different sources of information like customers, internal company and other stakeholders. Therefore, organizations are expected to use data warehouse to integrate customer data for analyzing their behavior. But, inappropriate integration of customer data will break the connection between customers and companies. http://www.iaeme.com/IJM/index.asp 554 editor@iaeme.com
  6. The Effect of Customer Relationship Management on Customer Satisfaction: Empirical Evidence from Star Rated Hotels in Amhara Region, Ethiopia Collaborative CRM: This type of CRM can enable to integrate the strategic and tactical business approaches of separate business entities for better customer identification, development and satisfaction. CRM technology plays a fabulous role for the integration of people, process and strategies to make sure that business objectives will achieve. 4.2. Objectives and Benefits of CRM Companies supposed to manage their customer base to generate better results through identifying, acquiring, satisfying and retaining profitable customers. The following are key objectives of many CRM strategies: Providing quality customer service, increase customer satisfaction and loyalty, increase customer revenue, discover new customers, cross sell/up sell products more effectively, and help sales staff close deals faster, reduced cost to serve , make call centers more efficient, provides better self-service options for customers, improves buyer-seller integration, enables better personalization of marketing messages, provides customers a “one-to-one experience, improves sales force efficiency and effectiveness, increases supply-chain efficiencies via personal contact, enhances supplier know-how, coordinates communication, improves ability to find, obtain and keep customers, improves product differentiation, enables knowledge management (Chen & Popovich, 2003; Croteau & Li, 2003; Jones, Stevens, & Chonko, 2005; Park & Kim, 2003; Andrian Payne, 2005). According to (Matamoros, 2012), the extensive search the following important benefits of CRM are given:  Improved ability to target profitable customers;  Integrated offerings across channels;  Improved sales force efficiency and effectiveness;  Individualized marketing messages;  Customized products and services;  Improved customer service efficiency and effectiveness; and  Improved pricing. 4.3. CRM and Hospitality Industry According to Ken Jacobson (2015), there are four basic benefits that CRM provides to hospitality industries: 1. Line up with organizational objectives The hospitality business includes hotel, transportation, tourism, lodging and other businesses that options client satisfaction and delight as a part of the service they are providing. 2. Simply reconstitute supported customer knowledge Knowledge from CRM software package means that a company is not dynamic blindly, it is a slow method that adapts to the feedback provided by customers' experiences and hospitality business successes. 3. Maintain guest loyalty Loyalty 360, the loyalty marketers’ association, featured an analogous story of a cordial reception company that amended practices supported CRM knowledge. The Loyalty 360 article indicated that programs that encourage repeat business are essential as a result of holding recent customers is additional profitable than attracting new ones and word of mouth is the most effective advertising. 4. Tools of staff to succeed Employees are at the frontier of cordial reception. A company will have all the systems and pointers; however, it is up to the folks that are literally interacting with the purchasers to http://www.iaeme.com/IJM/index.asp 555 editor@iaeme.com
  7. Simachew Zeleke and Dr. A. Prabhu Kumar create positive; those ways are being properly used. Companies got to prepare their force for CRM for cordial reception implementation. The hospitality industry generally and therefore the hotel industry especially are highly interactive and interesting where customer-centricity literally forms the core of business relationships. It is compulsory that at any given time, an inclusive view of customers is maintained. Hotel industries worldwide are therefore constantly on the look-out the formost rewarding ways not only to satisfy but exceed customer expectations with every consequent experience. Cost effective, tenable, and in fact customer centric plans and methods are an absolute must to remain afloat during this industry’s competitive environment. Working in the hospitality stream could be quite challenging. Among the different service industries, the hospitality industry is exclusive in its nature which tends to be service-oriented and features a strong emphasis on human exchange within the service delivery processes. Hospitality industry has the following characteristics: product-service mix, two-way communication, relationship building, diversity in nature and labor intensive (“The Government of the Hong Kong Special Administrative Region, 2013”). Creating and maintaining long lasting relationship with customers and deliver absolute customer satisfaction seems the critical agenda of contemporary business organizations. The nature of service organizations generally and the sensitivity of hotel organizations particularly, made them vulnerable to intense competition. 4.4. Dimensions of Successful CRM Four key areas in which successful CRM being implemented are people, technology, strategy and process (Fox & Stead, 2001). Technology is one part of CRM instead of viewed as an exclusive solution for CRM. Managing a successful CRM implementation requires an integrated and balanced approach to business strategy, technology, process, and people (Chen & Popovich, 2003). 4.5. Hypotheses Development People The people element of CRM is the most important and difficult component given the sensitivity of users to change. Proper understanding of the reasons for change, active participation in the formulation of change, getting sufficient information about the change, or getting adequate training about the change will users often be positive to that change otherwise they will be averse (GOLDENGERG, J. B, 2002). The role of employees does not be undermined during CRM implementation and everyday use. There are many number of issues in which the employees concern needed for CRM success; for example, senior management’s leadership during technology implementation, employees’ readiness to support the initiative, and their willingness to share customer-related data across organizational storage tower (Iriana & Buttle, 2006). Human resource is the basic asset for every organization to achieve competitive advantage (Kim, Jeon, Jung, Lu, & Jones, 2012). Ahearn et al. (2012) saw that salespeople have dynamic capabilities that enable the company to react quickly to customer needs and, for this reason, they provide a competitive advantage. Employees’ attitude and knowledge played a great role for CRM implementation. H1o: People dimension in CRM does not have a significant influence on customer satisfaction. H1a: People dimension in CRM has a significant influence on customer satisfaction. Process http://www.iaeme.com/IJM/index.asp 556 editor@iaeme.com
  8. The Effect of Customer Relationship Management on Customer Satisfaction: Empirical Evidence from Star Rated Hotels in Amhara Region, Ethiopia The process perspective highly advocates the development of buyer-seller relationships and interactions. Relationship development and maintenance is the basic area of CRM process regardless of the level of aggregation used to define it (Gronroos, 2000; Pravatiyar & Sheth, 2000). Because of the simultaneous production and consumption prevalent in hospitality services, the processes through which customers buy and consume hospitality products are crucial to marketers. Important processes include booking, checking in and checking out, queuing systems and service operations. Marketers need to ensure that the organization’s service delivery processes are efficient, customer friendly and competitive (David Bowie & Francis Buttle, 2004). H2o: Business process dimension in CRM does not have a significant influence on customer satisfaction. H2a: Business process dimension in CRM has a significant influence on customer satisfaction. Strategy At the very beginning most business practitioners and academicians viewed CRM as a technology or software application. However, CRM may be a broader concept than simply technology. For instance, CRM has been defined as “an enterprise- wide commitment to identify companies esteemed, individual customers and create a relationship between them, as so long as that relationship is mutually beneficial” (Gamble et al., 1999). This definition highlights several important CRM concepts. These are: the company will actively hunt down the proper customers (which means companies will not target those that will not do business with them), will develop a long-term, interdependent relationship with each customer by starting and maintaining a two-way dialogue, will strive to satisfy customers’ needs and solve customer problems, and can support customers throughout the life cycle of their interactions with the firm (Piccoli, Spalding, and Ives, 2001). This expression implied that CRM approach demands more attention beyond computer system and information technology. H3o: Strategy dimension in CRM does not have a significant influence on customer satisfaction. H3a: Strategy dimension in CRM has a significant influence on customer satisfaction. Technology Many customer centric strategies and approaches cannot be achieved without the help of information technology (Sigala, 2005; Sin et al; 2006). As a result of this many hotels and other business organizations implement CRM system to achieve superior business performance (Moriarty et al; 2008). Different researchers have to found the positive and significant impact of CRM technology on business performances in hotel sectors (Basma Elsaid Eldesouki & Yang Wen, 2018; Nuha Hassan, 2017; Tawinunt, T. Phimonsathienand & Wanno Fongsuwan, 2015). CRM technology can facilitate the business activities and may enable to gather, store, analyze and implement customer data for both customer and company benefit. Companies quickly learned that collecting and acting on customer data could help them acquire and retain profitable customers (Nguyen & Mutum, 2012). H4o: Technology dimension in CRM does not have a significant influence on customer satisfaction. H4a: Technology dimension in CRM has a significant influence on customer satisfaction. http://www.iaeme.com/IJM/index.asp 557 editor@iaeme.com
  9. Simachew Zeleke and Dr. A. Prabhu Kumar 4.6. CRM and Customer Satisfaction Satisfaction is the person’s feeling of pleasure or disappointment comparing with perceived product/service against expectations. If the perceived performance is greater than their expectation, customers will be delighted/over satisfied. If the perceived performance is below their expectation, customers will be disappointed/ dissatisfied. If the perceived performance of the product matches with their expectation, customers will be satisfied (Kotler & Keller, 2012). The relationship between CRM and customer satisfaction is complex. Enhancing customer satisfaction is one of the benefits and objectives of CRM in different business organizations. Measuring customer satisfaction serves to measure other customer behaviors like customer loyalty and customer complaints. This also help to measure the performance of CRM on return on investment and profitability (Allen, 2000). H5o: There is no relationship between CRM dimensions and Customer satisfaction. H6a: There is relationship between CRM dimensions and Customer satisfaction. Different research results revealed the relationship between CRM performance and customer satisfaction and loyalty on different service sectors in different years. Arup Kumar Baksi (2015), studied the moderating effects of CRM performance in banking industry and the result revealed CRM performance has a strong and positive impact on customer satisfaction. According to (B. Angamuthu, 2015), CRM practices in the hotel sector have significant and positive effect on customer satisfaction. One study in Albanian tour operator business shows that not all CRM features influence or equally influence customer satisfaction and loyalty. In the study five dimensions of CRM (organizational commitment, customer experience, process driven approach, reliability and technology) are used to show their influence on customer behaviors such as customer satisfaction and loyalty. All dimensions of CRM except technology affect customer satisfaction (Arnil Lacej, Ermira H. Kalaj, 2015). Sanaullah Nazir, Sheraz Khan, Raja Ahmed Jamil, Qazi Shujaat Mehmood (2014), studied the impact of CRM on customer satisfaction in the hotel industry. The authors used service quality, service access and service features as a variable of CRM and the result showed that all variables significantly and positively affect customer satisfaction. The research conducted by (Abdul Alem Mohammad, Basri Bin Rashid, Shaharuddin Bin Tahir, 2013), on 3 to 5 star hotels in Malaysia, all dimensions of CRM (i.e. customer orientation, CRM organization, knowledge management and technology based CRM) have a positive and significant impact on different perspectives of hotel performance. However, CRM technology failed to show a significant relationship with learning and growth perspective of hotel performance. http://www.iaeme.com/IJM/index.asp 558 editor@iaeme.com
  10. The Effect of Customer Relationship Management on Customer Satisfaction: Empirical Evidence from Star Rated Hotels in Amhara Region, Ethiopia 5. CONCEPTUAL FRAMEWORK People Technology Customer Satisfaction Process Strategy Figure 1 Conceptual Framework Source: Adapted from literature 6. RESEARCH METHODS 6.1. Research Approach The nature of this research, which aims at identifying critical aspects and CRM practices, will help the researcher to select the research approach. In order to acquire a good insight about the research problem and questions, the researcher did a library research about CRM and to come up with a comprehensive theoretical framework. Any research can follow deductive or inductive approach. Deductive research approach helps to test hypothesis based on the existing theories whereas inductive research approach helps to construct theories through collection and analysis of data. As far as this study is concerned, the deductive approach is chosen. 6.2. Research Strategy Experiment, survey, case study, action research, grounded theory, ethnography and archival research are examples of research strategies in social science research. Each strategy can be used for exploratory, descriptive and explanatory research studies (Mark Saunders, Philip Lewis and Adrian Thornhill, 2009). For this research, a survey strategy would be deployed. Survey strategy further classified as longitudinal and cross sectional studies. When the study is a snapshot taken at a particular point of time or the study of a particular phenomenon (or phenomena) at a particular time; it is probable that the research will be cross- sectional whereas when the study has to study change and development and taken at a series of time, it is probable that the research will be longitudinal. Therefore, this research is cross sectional study. 6.3. Target Population Statistical population of this research would be three and four star hotels found in two cities of the Region. Based on the statistics of the Amhara Culture and Tourism Bureau (2017), there are 13 Hotels in the first round (7 in Bahir Dar and 6 in Gondar cities) registered three and four star hotels which are serving both foreigners and domestic nationals. http://www.iaeme.com/IJM/index.asp 559 editor@iaeme.com
  11. Simachew Zeleke and Dr. A. Prabhu Kumar Table 1 Target Hotels of the research s.no Name of Hotels Hotel grade Located City 1 Avanti Blue Nile 4 Bahir Dar 2 Jacaranda 4 Bahir Dar 3 Grand Resort 3 Bahir Dar 4 Benmas 3 Bahir Dar 5 Addis Amba 3 Bahir Dar 6 Rahn Nile 3 Bahir Dar 7 Asinuara 3 Bahir Dar 8 Florida International 3 Gondar 9 Jantekel 3 Gondar 10 Gondar land Mark 3 Gondar 11 Taye Belay 3 Gondar 12 AG 3 Gondar 13 Goha 3 Gondar Table 2 Number of Population (Guests) during data collection s.no Name of the Hotel Hotel Total population Located City grade/star (Number of guests booked during data collection) 1 Avanti Blue Nile 4 53 Bahir Dar 2 Jacaranda 4 50 Bahir Dar 3 Grand Resort 3 52 Bahir Dar 4 Benmas 3 41 Bahir Dar 5 Addis Amba 3 44 Bahir Dar 6 Rahn Nile 3 44 Bahir Dar 7 Asinuara 3 46 Bahir Dar 8 Florida International 3 44 Gondar 9 Jantekel 3 46 Gondar 10 Gondar land Mark 3 46 Gondar 11 Taye Belay 3 42 Gondar 12 AG 3 42 Gondar 13 Goha 3 48 Gondar Total 598 All hotels are taken through census method whereas regarding guests Krejcie and Morgan, 1970 sample size determination used and the detail is as follows: S=required sample size N=the given population size P=prevalence d= degree of accuracy =3.841 for the 95% confidence level http://www.iaeme.com/IJM/index.asp 560 editor@iaeme.com
  12. The Effect of Customer Relationship Management on Customer Satisfaction: Empirical Evidence from Star Rated Hotels in Amhara Region, Ethiopia Therefore, the sample size is determined as follows at 95% confidence level and 5% margin error. S=574.23/2.45 S=234.38, approximately=234 Sample size estimation determines the number of complete cases which are needed for analysis. Therefore, 234 samples are required. But some subjects who enroll in the study may drop out, others may be protocol failures and still others may have incomplete data, especially on the key outcome variables. To deal with this, the researcher decided on an “attrition rate” and inflate the sample size by a certain factor. During data collection, the researcher expected to lose about 18% of the sample, then the sample size should be increased by a factor of 1 / (1 - 0.18) or 1.22. That is, enroll 22% more subjects that the sample size calculation called for. Therefore, 234 x 1.22=285.48 which is approximately 286. Twenty-two sample guests in each hotel had been selected during check-in at reception desk. Therefore, from thirteen hotels, random sample of 286 guests had been selected at check-in, using simple random sampling. 6.4. Data Collection and Analysis Methods Primary data was collected via self-administered questionnaire. Secondary information also from books, academic journals, and websites collected. In this study, the questionnaire is designed in the form of five point Likert Scale. The scale of 47 CRM variables ranged from strongly disagree to strongly agree; specifically, strongly disagree (1), disagree (2), neither nor (3), agree (4) and strongly agree (5). On the other hand, 11 items of customer satisfaction arranged from strongly dissatisfied (1) to strongly satisfied (5). Likert scale is a standard measurement frequently applicable in survey type research. This research basically has independent / antecedent variables and dependent /outcome variable. Independent variables included CRM components such as people, technology, process and strategy whereas customer satisfaction is a dependent variable. Multiple regression, ANOVA and Pearson correlation coefficient were the methods applied for data analysis. SPSS version 23 software was deployed. Multiple regression equation is framed as follows: Cus.sat =Bo+B1Ppl+B2Tech+B3Proc+B4Stra+e1 Where; Ppl=people, Tech=Technology, Pro=Process, Stra=strategy, Cus.sat=Customer satisfaction, B0=intercept, B1-B4=Beta coefficients, e1=Measurement error 7. RESULTS The researcher has distributed to 286 total guests and finally collected complete data from 260 which was a response rate of 90.9%. http://www.iaeme.com/IJM/index.asp 561 editor@iaeme.com
  13. Simachew Zeleke and Dr. A. Prabhu Kumar Table 3 Relationship between CRM and customer satisfaction Total customer satisfaction Total people Pearson Correlation .570** Sig. (2-tailed) .000 N 260 Total technology Pearson Correlation .314** Sig. (2-tailed) .000 N 260 Total process Pearson Correlation .379** Sig. (2-tailed) .000 N 260 Total strategy Pearson Correlation .559** Sig. (2-tailed) .000 N 260 ** Correlation is significant at the 0.01 level (2-tailed). The basic thing to think about within the output is that the size of the worth of the coefficient of correlation. This will range from –1.00 to 1.00 and show the strength of the relationship between the two variables. The result of correlation between variables may be 0, 1, –1 and between 0 and 1. The value of 0 indicates that there is no correlation, 1 indicates perfect positive correlation and -1 for perfect negative correlation. Different authors suggest different interpretations when values between 0 and 1happens; however, Cohen (1988, pp. 79–81) suggests the subsequent guidelines: Small r=.10 to .29 Medium r=.30 to .49 Large r=.50 to 1.0 These guidelines apply whether or not there is a negative sign out the front of the r value. Remember, the negative sign refers only to the direction of the relationship, not the strength. The strength of correlation of r=.5 and r=–.5 is the same. It is only in a different direction. According to table 3, people and strategy variable in CRM have large and positive relationship to customer satisfaction. On the other hand, technology and process variable in CRM have medium and positive relationship to customer satisfaction. To determine whether the correlation between variables is significant, compare the p- value to the significance level. The p-value tells us whether the correlation coefficient is significantly different from 0. In these results, the p-values for the correlation between CRM variables and customer satisfaction is less than the significance level of 0.05, which indicates that the correlation coefficients are significant. Therefore, Hypotheses 6: There is no relationship between CRM and customer satisfaction is rejected. Table 4 Multiple regression results Model Summaryb Model R R Square Adjusted R Square Std. Error of the Estimate 1 .641a .411 .402 4.44890 a. Predictors: (Constant), Total strategy, Total technology, Total people , Total process http://www.iaeme.com/IJM/index.asp 562 editor@iaeme.com
  14. a Coefficients The Effect of Customer Relationship Management on Customer Satisfaction: Empirical Evidence from Star Rated Hotels in Amhara95.0% Region, Ethiopia Unstandardized Standardized Confidence Collinearity Coefficients Coefficients Interval for B Correlations Statistics Std. Lower Upper Zero- Model B Error Beta t Sig. Bound Bound order Partial Part Tolerance VIF 1 (Constant) 11.245 2.818 3.990 .000 5.695 16.795 Total people .388 .060 .391 6.458 .000 .269 .506 .570 .375 .310 .631 1.584 Total -.034 .050 -.044 -.670 .503 -.132 .065 .314 -.042 -.032 .533 1.875 technology Total -.037 .086 -.031 -.432 .666 -.205 .131 .379 -.027 -.021 .453 2.209 process Total .461 .080 .382 5.753 .000 .303 .619 .559 .339 .277 .523 1.912 strategy a. Dependent Variable: Total customer satisfaction b. Dependent Variable: Total customer satisfaction Evaluating the Model R Square in the multiple regression table tells that how much of the variance in the dependent variable (customer satisfaction) is explained by the model (which includes the variables of people, technology, process, and strategy). In this case, the value is .411. Expressed as a percentage (multiply by 100, by shifting the decimal point two places to the right), this means that the model (which includes the four variables) explains 41.1 percent of the variance in customer satisfaction. ANOVAa Model Sum of Squares df Mean Square F Sig. 1 Regression 3518.808 4 879.702 44.446 .000b Residual 5047.130 255 19.793 Total 8565.938 259 a. Dependent Variable: Total customer satisfaction b. Predictors: (Constant), Total strategy, Total technology, Total people , Total process ANOVA table shows whether the result is statistically significant. The model in this result reaches statistical significance (Sig. = .000; this really means p
  15. Simachew Zeleke and Dr. A. Prabhu Kumar the Sig. value is less than .05, the variable is making a significant unique contribution to the prediction of the dependent variable. If greater than .05, it can be concluded that the variable is not making a significant unique contribution to the prediction of the dependent variable. This may be due to overlap with other independent variables in the model. In this case, both people and strategy made a unique, and statistically significant contribution to the prediction of total customer satisfaction. On the other hand, the remaining two variables (technology and process) made not statistically significant contribution to the prediction of customer satisfaction. Therefore, the null hypotheses 1 and 3 are accepted whereas 2 and 4 are rejected. 8. DISCUSSION AND CONCLUSION Customer relationship management nowadays is the compulsory business approach to gather and store the detailed profiles of customers for better understanding of their needs and requirements. Hospitality industry including hotels are among the different industries which are applying CRM to boost guest satisfaction. CRM in the hotel sector mean keeping in touch with guests, strengthening hotels relationship with them and boosting the pluses that give the repeat guests. Based on this research result, CRM people in the hotels and their strategies significantly influence customer satisfaction. But technology and the process of these hotels failed to show a significant influence. According to (Arnil Lacej, Ermira H. Kalaj, 2015), all dimensions of CRM except technology affect customer satisfaction. The research conducted by (Abdul Alem Mohammad, Basri Bin Rashid, Shaharuddin Bin Tahir, 2013), on 3 to 5 star hotels in Malaysia, all dimensions of CRM (i.e. customer orientation, CRM organization, knowledge management and technology based CRM) had a positive and significant impact on different perspectives of hotel performance. However, CRM technology failed to show a significant influence. Different researchers and practitioners have different views regarding CRM. Specially information technology experts and companies considered CRM as a software tool which will be installed in the company. On the other hand, companies that installed software had failed in their business. Previous researchers proved that the failures happened due to lack of overall views and approaches of CRM. The other reason mentioned why business organizations failed in their CRM implementation was inappropriate choice of CRM package. But this does not mean like undermining the role of technology in service industry. For example, Aliyu Olayemi Abdullateef and Salniza Md. Salleh (2013), had shown in their finding the great impact of technology based CRM in call center service industries. 9. PRACTICAL IMPLICATION In Ethiopia CRM is a recent phenomenon exercising in different service industries like bank and insurance, telecom and airlines. Hospitality industries are also implementing it for their frequent interaction with guests. Employees hospitality, knowledge and skill, responsiveness, and overall treatment of guests had a positive and significant contribution to customer satisfaction. Hotel managers are better to keep their performance and give more training for hospitality issues. Regarding the strategies of hotels, it had a positive and significant contribution to customer satisfaction. This shows that hotels are aware about the value of CRM as a corporate strategy like part of their strategic planning. Managers are expected to recraft and improve their hotel strategies according to the prevailing situation and existing demand. Ethiopia is weak in technology and digital economy. Most of the business activities are going on through traditional way of marketing rather than online shopping and e-commerce. Moreover, excess procedure from service order to service delivery is also another issue. Ease and friendly implemented technology cuts unnecessary processes and facilitates service delivery. Therefore, application of ease and http://www.iaeme.com/IJM/index.asp 564 editor@iaeme.com
  16. The Effect of Customer Relationship Management on Customer Satisfaction: Empirical Evidence from Star Rated Hotels in Amhara Region, Ethiopia user friendly CRM technology, integration of CRM to any other customer touch points such as social media, hotel websites, and third party agents will be the assignments of hotel managers. In addition to these hotel managers better to work for making employees capable enough how to use those technologies. REFERENCES [1] Addis Fortune, Published on (2015). Retrieved from https://addisfortune.net/articles/how- hotels-earn-their-stars/ on 9/17/2019. [2] Adrian Payne, (2005). Handbook of CRM. Achieving Excellence in Customer Management. Butterworth-Heinemann publications vol 1 [3] Anderson and Kerr, (2002). Customer Relationship Management: The McGraw-Hill Companies, Inc. United States of America DOI: 10.1036/0071394125 [4] Arnil Lacej, Ermira H. Kalaj, (2015). The Effect of Consumer Relationship Management on Satisfaction and Loyalty: A Focus on Albanian Tour Operator Business. Mediterranean Journal of Social Sciences Vol 6, No 2 DOI: 10.5901/mjss.2015.v6n2s1p635 [5] B. Angamuthu, (2015). Impact of customer relationship management on customer satisfaction and its role towards customer loyalty and retention practices in the hotel sector. BVIMSR’s Journal of Management Research, Vol. 7 Issue - 1 [6] Baksi, A.K. (2015). An empirical study to assess moderating impact of customer- relationship dimensions on service quality perception-tourist satisfaction-destination loyalty link, Singapore Management Journal, East Asia institute of Management, Singapore [ISSN: 2251-239X], Vol. 3, No.2, pp. 7-42. [7] Basma Elsaid Eldesouki and Yang Wen (2018). The Impact of Crm Dimensions on the Performance of Hotel Industry in Egypt: A Case of Cairo Hotels. International Journal of Business and Management Review Vol.6, No.3, pp.17-44 [8] Christopher H. Lovelock, Jochen Wirtz (2011). Services Marketing: People, Technology Strategy 7th ed. Pearson Education, Inc., publishing as Prentice Hall. [9] D. Goodhue, B. Wixom and H. Watson, (2002). “Realizing Business Benefits through CRM: Hitting the Right Target in the Right Way,” MIS Quarterly Executive, Vol. 1, No. 2, pp. 79-94. [10] Daniel Catalán-Matamoros (2012). An Overview to Customer Relationship Management, Advances in Customer Relationship Management, Dr. Daniel Catalan-Matamoros (Ed.), ISBN: 978-953-51-0516-9, In Tech, Available from: http://www.intechopen.com/books/advances-in-customer-relationship management/an overview-to-customer relationship-management. [11] Darrell, R. (2017). Top 10 Management Tools. http://www.bain.com/management_tools/BainTopTenTools/default.asp. [12] David Bowie and Francis Buttle, (2004). Hospitality Marketing [13] Dyche, J. (2002). The CRM Handbook: A Business Guide to Customer Relationship Management. Addison-Wesley Professional. [14] Eid, Riyad & El-Gohary, Hatem (2014). Muslim Tourist Perceived Value in the Hospitality and Tourism Industry. Journal of Travel Research. Fothcoming. 10.1177/0047287514532367. [15] Fox, T & Stead, S. (2001). Customer relationship management: delivering the benefits. White Paper, CRM (UK) and SECOR Consulting. New Malden [16] Francis Buttle, (2009). Customer Relationship Management Concepts and Technologies Second Edition Published by Elsevier Ltd. http://www.iaeme.com/IJM/index.asp 565 editor@iaeme.com
  17. Simachew Zeleke and Dr. A. Prabhu Kumar [17] Goldenberg, Jacob & Han, Sangman & Lehmann, Donald & Hong, Jae. (2009). The Role of Hubs in the Adoption Process. Journal of Marketing - J Marketing. 73. 1-13. 10.1509/jmkg.73.2.1. [18] Grönroos, C. (1997). "Keynote paper from marketing mix to relationship marketing ‐ towards a paradigm shift in marketing", Management Decision, Vol. 35 No. 4, pp. 322- 339. https://doi.org/10.1108/00251749710169729. [19] Injazz J. Chen, Karen Popovich, (2003). "Understanding customer relationship management (CRM): People, process and technology", Business Process Management Journal, Vol. 9 Issue: 5, pp.672-688 https://doi.org/10.1108/14637150310496758 [20] Iriana, Reiny & Buttle, Francis. (2006). Strategic, Operational, and Analytical Customer Relationship Management. Journal of Relationship Marketing. 5. 23-42. 10.1300/J366v05n04_03. [21] K. Tawinunt, T. Phimonsathien and Wanno Fongsuwan, (2015). A Structural Equation Model of Customer Relationship Management Factors Affecting Customer Retention of Long-Stay Travelers in the Thai Tourism Industry. Research Journal of Business Management, 9: 1-24. http://scialert.net/abstract/?doi=rjbm.2015.1.24 [22] Ken Jacobsen (2015). 4 Advantages of CRM for the Hospitality Industry. The TM Group [23] Kim, Kyung Hoon & Jeon, Byung Joo & Jung, Hong Seob & Lu, Wei & Jones, Joseph, (2012) "Effective employment brand equity through sustainable competitive advantage, marketing strategy, and corporate image," Journal of Business Research, Elsevier, vol. 65(11), pages 1612-1617. DOI: 10.1016/j.jbusres.2011.02.047 [24] Kotler, P., & Keller, K. L. (2012). “Marketing Management”, Global Edition 14e,. London: Pearson Education Limited 2012. Malhotra, Naresh K. & Birks, David F. [25] Nguyen, B. and Mutum, D. (2012). "A review of customer relationship management: successes, advances, pitfalls and futures", Business Process Management Journal, Vol. 18 No. 3, pp. 400-419. https://doi.org/10.1108/14637151211232614 [26] Nuha Hassan, (2017). The effect of CRM dimensions on customer satisfaction in telecommunication sectors in Sudan: International journal of novel research in Marketing management and economics Vol. 4, Issue 2, pp (29-40), www.noveltyjournals.com [27] Orthodox Tefera and Krishna Govender, (2014). Hotel Grading, Service Quality, Satisfaction and Loyalty – Proposing a Theoretical Model and Relationship. African Journal of Hospitality, Tourism and Leisure Vol. 4 (Special edition) - (2015) ISSN: 2223- 814X Copyright: © 2014 AJHTL - Open Access- Online @ http//: www.ajhtl.com. [28] Park, C. and Kim, Y. (2003). "Identifying key factors affecting consumer purchase behavior in an online shopping context", International Journal of Retail & Distribution Management, Vol. 31 No. 1, pp. 16-29. https://doi.org/10.1108/09590550310457818. [29] Parvatiyar A and Sheth JN (2001). Conceptual Framework of Customer Relationship in Customer Relationship Management – Emerging Concepts, Tools and Applications, Tata McGraw Hill, New Delhi, pp. 3-25. [30] Patrick Amofah and Amer Ijaz, (2005). “Objectives, strategies and expected benefits of Customer Relationship Management initiatives in service companies, Master’s thesis Lulea University of Technology PP 7-10. [31] Paul Gray, Jongbok Byun (2001). Customer Relationship Management, center for research on information technology and organizations, University of California, Irvine, CA. [32] Rajesh, V., and Manivannan, L., (2013). “A Study on Customer Relationship Management in Bank of Baroda, with Special Reference to Erode City of Tamilnadu, India”, Wide Spectrum Research Journal, 1(11), 45-50. http://www.iaeme.com/IJM/index.asp 566 editor@iaeme.com
  18. The Effect of Customer Relationship Management on Customer Satisfaction: Empirical Evidence from Star Rated Hotels in Amhara Region, Ethiopia [33] Roya Rahimi, (2017). “Customer Relationship management (people, process and technology) and organizational culture in hotels: Which traits matter?” International Journal of Contemporary Hospitality Management, Vol. 29 Issue: 5, Pp 1380-1402, doi: 10.1108/1] CHM-10-2015-0617. [34] Vallabh, D., Radder, L. & Venter, D. (2015). “Factors preceding CRM readiness in small- and medium-sized tourism enterprises”, Acta Commercii, Vol.15, No. 1, 263. http://dx.doi. org/10.4102/ac. v15i1.263. [35] Tamanna Kachwala and L. K. Sharma, Comparative Study of Supervised Learning In Customer Relationship Management. International Journal of Computer Engineering & Technology, 8(6), 2017, pp. 77–82 [36] Manoj Aiyer, Jayant Kumar Panigrahi and Biswajit Das, (2018), Successful Customer Relationship Management in Business Process Integration and Development of Applications for Project Management, International Journal of Mechanical Engineering and Technology, 9(2), pp. 637–643. [37] Dr. Giriraj Kiradoo, (2010), The Effect of Customer Relationship Management (CRM) Factors on Improving Satisfaction and Loyalty of Customers, International Journal of Advanced Research in Management, 1(1), pp. 80–86. [38] Dr. V.Antony Joe Raja, (2013), New Strategy in Today Banking Sector: Bank Customer Relationship Management (CRM) & Marketing Mix in World, International Journal of Marketing and Human Resource Management, 4(3),. pp. 19–29. http://www.iaeme.com/IJM/index.asp 567 editor@iaeme.com
nguon tai.lieu . vn
Quản lý dự án Quản lý Nhà nước Tiêu chuẩn - Qui chuẩn Kinh tế học Luật học Quy hoạch - Đô thị Hoá học Quản trị kinh doanh Kiến trúc - Xây dựng