Applying Customer Relationship Management in Central American SMEs---focus on Cultural Dimension

Contemporary world is characterized by a high level of competition. To survive and prosper in a marketplace, enterprises must respond to opportunities and threats to conquer it. Despite a growing recognition of the importance of Central America market as a potential market and the usefulness of Customer Relationship Management (CRM) as a managing tool to improve enterprise competitive performance, there has been little systematic research on this area.

The purpose of this research is to (1) to understand Central American SME managers’ main characteristics and negotiations patterns (2) To classify and categorize managers into cultural dimension developed by Hofstede and Trompenaars’s theories (3) To use this information to help Taiwanese SME to have a deep understanding of Central America SME negotiation patterns in order to develop a successful consumer relationship management (CRM) in the future.

Research results were conclude by participation in Trade Exhibition in Central American, direct observation and in deep interview. The data was analyzed based on two main theories: Hofstede and Trompenaars Cultural dimensions in order to avoid any oversimplified explanation. Both approaches allow managers to understand customer behavior trend and to realize how to do business in a country culturally different from the one at home.

Applying CRM in Central American SME based on Hofstede Cultural Dimension, this study finds that those managers tend to be more: (1) Collectivism, (2) Strong Power distance, (Hierarchy) (3) High trend to uncertainty avoidance (4) Feminine perspective and (5) Short term orientation. While following Trompenaars Cultural Dimension, Central American SME manager are characterized as high trend to: (1) Particularism (2) Diffuse culture (3) Communitarianism (4) Outer Directed (5) Synchronous and (6) Ascription (7) Hierarchical structure.

It is expected that findings of this study will guide Taiwanese SME to establish long lasting and valuable customer relationship with Central American Small and Medium Enterprises. Finally, It is important to remember that managers must create an intercultural frame mindset and “Recognize” that we live in a world with cultural differences, for instance we should “Respect” this heterogeneity and should try to “Reconcile” cultural differences.