THE IMPORTANCE OF INNOVATIVENESS AND KNOWLEDGE MANAGEMENT FOR DEVELOPMENT OF RURAL TOURISM IN

VOJVODINA

Dunja Vujičić1

Ana Jovičić2

Abstract

The objective of the paper is to highlight the importance of knowledge management and innovativeness for the development of rural tourism in Vojvodina. Farmsteads in Vojvodina are representative facilities of rural tourism and innovative business ventures which have exceptional, though under-utilized tourism potential. Research methods used in the study include desk research, as well as an interview with the representative sample of farmstead managers. The results show that the majority of farms are planning to innovate the business in the future, where most ideas are acquired from guests, competition, and / or employees. According to the research results, farmsteads in Vojvodina still do not recognize the importance of knowledge management, due to the fact that a surprisingly large percentage of the respondents had never participated in educational activities that are important for business growth.

Key words

Knowledge management, innovativeness, rural tourism, Vojvodina.

1 Dunja Vujičić; MA in Engineering Management; Faculty of Technical Sciences; Trg Dositeja Obradovića 6, 21000 Novi Sad, Srbija; dunja.vujicic@fondmt.rs; 00381 65 5206928;

2 Ana Jovičić, MA in Economics, Geographical Institute Jovan Cvijić SASA, Đure Jakšića 9, 11000 Belgrade, Srbija; ana.jovicic@fondmt.rs; 00381 64 1478824

Introduction

Dynamic social, economic, political and ecological changes and processes have caused the unsustainable growth and development of urban areas. Rural tourism has emerged as a response to a high level of urbanisation, mass tourism and unsustainable growth and it is becoming increasingly attractive to modern tourist.

Due to its remarkable tourist and geographic location, natural and anthropogenic potentials, Vojvodina is an excellent resource for the development of various types of tourism. Considering the authentic architecture of Vojvodina, its numerous farmsteads and ethno houses, recognisable cuisine, manifestations and other predispositions, Vojvodina could become an important destination for rural tourism.

Innovation of organisation is the basis for success as it ensures for the organisations to be efficient, improve their product quality, cut the expenses, satisfy their clients’ needs, increase their sales and profits, ensure a bigger market share and distinguish themselves from the competition. Knowledge and knowledge management occur as significant catalysts in this process.This paper deals with farmsteads in Vojvodina which have a special role in the development of rural tourism in Vojvodina.

The objective of the study is to point out to the importance of knowledge management in rural tourism, in order to increase the innovation and ensure rural tourist products which can respond to tourists’ needs in a better way.

The task of this study is to determine whether farms, as representative hospitality objects in the function of rural tourism, respond to changes in the environment; what their attitude on changes is, whether they introduce innovation in their business management, from where they get ideas to improve their business management, which are the basic sources of knowledge and whether acquisition of new knowledge contributes to the improvement of business management.

The methods used in the research are desk research and interviews. The interviews were conducted with the owners or managers on farmsteads in Vojvodina. There were 30 farmstead involved in the study. The study will answer to the following research questions:

Do farmsteads have plans to innovate the business in the future?

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How do farmsteads come up with new ideas for improvement of business?

What is the attitude on the farmstead toward the changes? Do farmsteads analyze the market and follow the competition? Do employees on the farmsteads participate in seminars, training

courses and conferences that are relevant to the business? Do the farmstead owners recognize the importance of educational

activities for business improvement?

Research questions will provide an insight into farmsteads readiness to change. The basis for the development of rural tourism is the implementation of new knowledge, where innovation and knowledge management emerge as an important factors of rural tourism development.

The paper consists of several parts. The first part explains the notion of rural tourism and gives a short review of rural tourism in Vojvodina, with special focus on farms. The second and the third part give a reference review and point out to the significance of knowledge management and innovation of the organisational management. The fourth part explains the methodology used. The fifth part gives a review of the most important research results. The last part discusses the acquired results and gives a conclusion.

Rural tourism in Vojvodina

Tourism is one of the fastest-growing global activities which records growth of 25% in the last ten years, while the international tourist arrivals have increased over 4% in 2011 (UNWTO, 2012). In the following period, it is predicted that tourism will develop in all regions of the world, with the most intense relative growth in the developing countries. Tourism is a very complex and heterogeneous phenomenon which combines multiple activities such as hospitality, transport and other numerous indirect activities. The role of tourism is significant in the transition period. It is important to emphasise that tourism affects numerous economic sectors to a great extent, offers high ‘value added’ to the balance of payment in a country but also is an important generator of employment, especially for the employment development in rural areas.

Rural tourism is a type of tourism which involves the complexity of all activities and aspects of the whole tourist product (recreation in a rural area, enjoying leisure time and peace of the rural area, enjoying nature and diverse landscapes, national parks, nature parks, cultural tourism, rural households tourism) (Jafari 2000). The notion of ‘rural tourism’ has been recognized by

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the European Union, and as such it is related to all tourist activities in rural areas. Special types of rural tourism are: rural households tourism, hunting, fishing, ecotourism, medical tourism, sports and recreational, residential, educational, adventurous, transit, camping, continental nautical tourism, culinary and ethno culinary, tourism of protected areas, cultural tourism, religious tourism and other special types (Košić, 2009).

The role of government is highly important in supporting and encouraging the development of sustainable rural tourism (Mac Nulty, 2002). For many years Europe records excellent results in this field and further growth based on domestic market but also the support of the sustainable development concept is expected (Horwath Consulting Zagreb and The Faculty of Economics, Belgrade, 2005). On the other hand, Serbia does not fully exploit its rural tourism possibilities, such as rural tourism in the villages of Šumadija, farming tourism in Vojvodina, religious tourism, wine and ethno tourism, etc. (Čomić, 2002). Also, Vojvodina is specific for its remarkable ethnic diversity, which is a significant potential for creating numerous tourist products which should focus on folklore, culinary specialties and happenings which show the diversity and the richness of the cultural and historical heritage. Rural tourism is a real asset to the revitalisation of a large part of Vojvodina and Serbia as well, and their numerous smaller and bigger rural areas, at least those who are currently forgotten. The development of tourism in this area can seriously threaten or even stop young people from moving to cities, as today it creates elementary conditions for a general, much greater comfort of rural villages (Vratuša, Anastasijević, 2002).

Farmsteads3 in Vojvodina are the monuments of culture and tradition of the people who live in this area and are incredibly significant for the rural tourism of Vojvodina. Unfortunately, farmsteads are not fully exploited as a tourist concept, although they are characterised as the trademark of Vojvodina and cultural specificity of the Pannonian region (Dragićević, 2007). Most farmsteads were built in the middle of the last century, while some farms are over 200 years old and have become ethno museums with a multitude of old tools, agricultural tools, brick stoves and antique guest rooms with large beds and down comforters (Anđelković, 2006). Although the value of farms is reflected in retaining and presenting a classic lifestyle in Vojvodina, many of them have been redecorated and adjusted to modern

3 Farmstead is a translation of the Serbian word salaš, which is loanword from the Hungarian szállás. It is a rural estate surrounded by outbuildings mainly used for agricultural activities. It is characteristic for the Panonian area. Although it does not have the exact same connotation as szallas, there is no equivalent for this word in English, so the translation farmstead will be used in the text.

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needs, and thus there are swimming pools, courts, ponds and other recreational facilities. Some of the most famous and the largest farmsteads own stables, small zoos and ethno museums. Thus, farms in Vojvodina are ideal for a peaceful vacation with numerous recreational activities but also for enjoying great cuisine of Vojvodina, top local wines and rakija along with the merry sounds of the tamburica.

From the aspect of business management, farmsteads in Vojvodina are an innovative and entrepreneurial business venture. In order to be seen as such, farms which are used for the needs of rural tourism should retain their original look and the authenticity of the surroundings, as this is the only way they can form a differentiated tourist value compared to regular restaurants and farms. Farmsteads are supposed to be conceived in such way to enable their owners to live there and do their agricultural activities, but also to provide accommodation, food and other services to their tourists (Anđelković, 2006). In the last several years there has been recorded a raise of awareness on the significance of farmsteads for the culture and tradition of Vojvodina (Tomić, 2002).

Knowledge management

It is globally accepted that knowledge is one of the most important sources of competitive advantage in the increasingly turbulent global business environment. Although many different models can be found in different studies (Kim, 1993; Choo, 1998; Jakubik, 2011; Nonaka et all, 2000; Melkas, Harmaakorpi, 2008), the existing models poorly answer the question of how knowledge is actually created and shared among the actors of different organisational environments. Some studies (Rutten, 2004; Nonaka et all, 2000; Cappellin, 2007; Gertler, Wolfe, 2004) suggest that the practice and investigating knowledge management should focus not only on individual organisations but also larger units (cities, regions). There are numerous approaches in different studies. Patriotta (2003) described the evolution of different paradigms on knowledge management, naming approaches in the following way: the approach based on resources, the cognitive approach, the approach based on knowledge, situational approach and the technological and scientific approach. He considered epistemological assumptions on which the existing theories of the organisational knowledge are based, emphasising that the nature of knowledge has been much discussed, and that knowledge has proved to be a multiple phenomenon. During the last decade, there were several attempts to integrate different approaches of knowledge management into a common framework (Jashapara, 2005; Patriotta, 2003; Koenig, 2008). These studies recognised the perspectives of human resources and strategic

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perspectives of management, as well as the perspective aspects of the informational systems (Jashapara, 2005).

In papers which deals with knowledge management, knowledge is becoming to be viewed as situational and contextual (Koenig, 2008). Apart from that, (Orlikowski, 2002) claims that knowledge is related to objects (things, elements and facts), and that cognition is related to action (practice). She emphasised that cognition is the ability to change and that it occurs in active social interaction. Apart from that, Orlikowski (2002) claims that sharing knowledge occurs only when it is possible to learn the practice from others. Thus, cognition and abilities can be examined only by examining practice i.e. by learning how something is being done in practice. Knowledge base of a company cannot consist of multiple sources. Kerssens-Van Drongelen (1996) classified these sources into four categories:

• brainware: knowlegde which is inside a person’s mind, such as intuition, experience, a specialised knowhow;

• hardware: tangible things such as material prototypes, products, research and hardware development, the production process;

• groupware: undocumented knowledge shared among people, such as heuristic, procedures, stories, myths;

• documentware: knowledge documented on paper or in data base/information systems, such as intranet, parts of data base, patents, manuals, laboratory reports, etc. (Davis et al., 2006).

Swan, Scarbrough and Preston (1999) define knowledge management as ‘’any process or practice of creating, earning, sharing and using knowledge, in order to improve learning and performance in a company.’’ Johannessen, Olsen and Olaisen (1999) have given a more complete definition, taking into account different types of knowledge: systemic, explicit, tacit, as well as hidden knowledge. Systemic knowledge is acquired by examining models such as those from computer simulations exercise. Explicit knowledge is relatively easy to acquire by listening and reading. The knowledge relation is being learned in interaction and is relatively difficult to communicate. The most difficult types are tacit and hidden knowledge, as they are difficult to comprehend and communicate. Hidden knowledge is the way of organising ideas and mental models and it is usually acquired through socialising. However, the most valuable type of knowledge is tacit knowledge. Johannessen, Olsen and Olaisen (1999) describe it as a "know how" knowledge, which is acquired by using, working and experimenting. Tacit knowledge is usually highly subjective and it is inside a person’s mind, therefore it is hard to communicate, comprehend and quantify. This is why

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companies struggle to discover how to motivate their employees to share tacit knowledge, which is recognised as a significant strategic tool. Many companies attempt to achieve this by training their employees (internships) or developing their employees’ competence.

Education of employees is essential for faster accepting and adapting to changes in the business environment, as well as for the improvement of the business and achieving a competitive advantage.

The importance of innovation for the business

The company’s ability to innovate and use the advantages of innovation is a deciding factor of its survival in today’s turbulent and unstable environment (Doyle, 1998; Quinn, 2000).

Innovation is defined as creation and successful apllication of a new product, process (Cumming, 1998), new idea (McAdam et al., 1998; Urabe, et al., 1988), new knowledge form (Chaharbaghi, Newman, 1996); new way of delivering quality or value for the client (Knox, 2002) or their combination. According to Freeman and Perez (1994) innovation is possible to classify to: incremental innovation, radical innovation, changes in the technological system and changes in the technological and economic paradigm.

Incremental innovations include a series of small improvements or changes in the way some things are done in a longer time period. They affect the improvement of product and service quality. Radical innovations are fundamental and revolutionary changes which demand clear departure from the existing practice, processes and technology (O’Reilly, Tushman, 2004). Most commonly they are the result of research activities in companies, universities and institutes. This type of innovation brings big changes, marks a new usage, property, design or components of the product compared to the existing ones (Kontić, 2008).

However, due to its low density and relatively small number of human and financial resources, rural area has weak connections with research and development centers, so it may encounter difficulties when it is necessary to make radical innovations. Innovations in rural areas may take over and adjust methods which have been created in other areas or finding new solutions for extremely persistent problems (Rollinger, 2012).

The innovation process is the process of learning, where companies create new knowledge, competence and abilities. Innovation value chain is the

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process of transforming innovation into new products, services, processes, etc. and then to exploit them in order to create new value. Innovation ability of a company depends on the ability to create new knowledge and the interaction between the individual and groups in a company (Kontić, 2008).

Ngo and O'Cass (2009) see innovative ability as an integrative process of applying collective knowledge, skills and resources in order to provide technological (product/service and production innovations) and non-technological innovations (management, marketing, market). In tourism and hospitality papers often focus on certain aspects of product quality, such as gastronomy, animation, wellness facilities (Jacob et al. 2003; Pikkemaat, 2008). Process innovations are analised in papers which focus on the effect of technology in order to achieve different benefits such as higher productivity, higher profit etc. (Siguaw et al., 2000; Sundbo et al., 2007). Innovations related to employees involve finding new ways to organise, direct and keep the staff, increase the satisfaction on the workplace and nurture knowledge and competence. Walsh et al. (2013) examine the application of instruments for managing human resources in hotel management. Hu et al. (2009), point out to the significance of team work and sharing knowledge for innovations.Innovation is the basis of company’s success in all areas, tourism as well, as it helps companies be more efficient, improve their product quality, cut the expenses, satisfy their clients’ needs, increase sales and profits, ensure larger market share and distinguish themselves from the competition (Jones, 1996). Knowledge and knowledge management are significant part of this process.

Methodology

This study used a questionnaire created by the author of the paper. The questionnaire consists of a six-item list, divided into two groups. The first group of items explores the presence of innovation management dimensions (four questions), while the second group of items is focused on examining the knowledge management dimension (two questions). Table 1 shows the questionnaire used in the study.

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Table 1 The questionnaire used in the study

Questions Answers

1. Do you have plans to innovate the business in the future?

There are no plansWe recognize the need for a plan, but we have not created an innovative plan yet and we are currently in a poor financial situationWe have plans and we are constantly implementing and improving them

2. How do you come up with new ideas to improve your business?

From the employeesFrom the guestsFrom the competitionAll mentioned above

3. What is the attitude toward the changes on the salash?

Changes are hard to acceptWe are aware that something needs to change, but we are not sure what and how •We are actively working on adapting changes. Moreover, we are involved in a constant process of change, because without it there is no progress

4. Do you analyze the market and follow the competition?

We do not analyze the market and its opportunitiesWe rely on clients feedbackWe analyze the market opportunities, monitor the competition and act accordingly

5. Do employees on the farmsteads participate in seminars, training courses and conferences that are relevant to the business?

NeverLess than once a yearOnce a yearMore than once a year

6. Do you recognize the importance of educational activities for business improvement?

Yes

No

The authors surveyed 30 out of 39 respondents who are the owners or the managers of farmsteads in the municipalities of Vojvodina, using the random sampling method by direct surveying. Direct surveying by telephone as well

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as face to face interviewing were used (five of the most famous farms were visited) in order to ensure the quality of the questionnaire.

There are 45 municipalities in the Autonomous Province of Vojvodina. According to official records, there are 39 farmsteads in 15 municipalities. Today there are 39 farmsteads in active business, which are located in 15 municipalities out of a total of 45 municipalities in Vojvodina: (Salaš Gojić – Salaš uzdaha, Salaš Gnjezdo), Bačka Topola (Capriolo, Salaš udvardi), Bela Crkva (Zeleni dvor), Inđija (Salaš od srca, Salaš Stojšić, Zekin salaš), Kanjiža (Kucora salaš), Kula (Vinska kuća Ačanski), Mali Iđoš (Salaš Katai), Novi Bečej (Salaš Slano Kopovo), Novi Sad (Brkin salaš, Cvejin salaš, Kizin salaš, Mitin salaš, Mlađin salaš, Naš salaš, Pejićev salaš, Salaš 137, Salaš Prodanov, Salaš Volić), Odžaci (Katićev salaš), Sombor (Art salaš Višinka, Dida Hornjakov salaš, Salaš Bošnjak), Srbobran (Beljanski raj, Salaš Đuze Svorcana, Salaš Toše Zeremskog), Subotica (Jelen salaš, Majkin salaš and Cvetni salaš, Rokin salaš, Salaš Đorđević, Salaš-majur roža, Vinski salaš Čuvardić), Žabalj (Babin salaš, Monikin salaš, Vila Diva). The most famous farms are Salaš 137, Majkin salaš, Cvetni salaš, Rokin salaš and Perkov salaš (Tourist organization of Vojvodina, 2013).

Results

The first question was aimed to determine whether farms have plans for the business improvement.The results show that 46.7% of respondents have some business innovation plans for the future. A smaller percentage of respondents recognise the need for the innovation plan but do not have one yet or they currently do not have finances to make one (27.7%). It should be mentioned that a negligible percentage of respondents have no innovation plans at this moment (26.7%).

The responses related to the source of new ideas for the improvement of business point out to the fact that most ideas are collected from various sources: guests, competition and employees (40.0%). A significant percentage states that most ideas are the result of immediate communication with their guests (33.3%) or that the employees came up with the ideas (23.3%). A small percentage (3.3%) stated that competition is their source of new ideas for the improvement of business.

As far as respondents’ relation to changes is concerned, opinions are divided. A significant percentage (36.0%) states that changes are hard to deal with it , while a similar percentage stated (33.3%) that they actively work on implementing changes. The smallest but not negligible percentage (30.0%)

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admits that they are aware of the significance of following and adjusting to changes, but that their farmstead does not yet have a clear plan and the way in which it can be changed.

When asked if the management of farmsteads analyze the market and follow the competition, answers were following: 16.7% of respondents stated that they rely solely on their guests’ feedback. From this it can be concluded that less than half of respondents (40%) analyse market opportunities, keep track of their competition and act in accordance with what seems to be poor results.

The responses to the question whether and how frequently employees on farmsteads participate in educational activities, the results showed that a large percentage was never involved in seminars, trainings and conferences relevant to business (69.9%). A significantly smaller percentage (16.7%) stated that they attend these type of educational activities less than once a year, while the smallest percentage (6.7%) regularly attend educational activities once a year or more (6.7%).

Despite the previous response which points out that insufficient evaluation of educational activities by respondents, as well as insufficient attending of those activities, a good result is the fact that 77.7% of respondents considers the attending of educational activities to be useful for them and their company.

Discussion and conclusion

The paper focuses on exploring the dimensions of knowledge and innovation management on the farmsteads of Vojvodina. Farmsteads are especially valuable as tourist attractions for the development of rural tourism of Vojvodina, considering that apart from accommodation, they offer an authentic experience to their guests, in the environment which reflects the spirit of times gone by and the lifestyle of this region, as well as rich gastronomic offer (Jovičić et al, 2013).

In order to explore the dimensions of knowledge and innovation management on the farmsteads in Vojvodina, a survey was conducted. It is positive that almost half of the managers and owners of the farmsteads have some business innovation plans for the future, while a smaller percentage is limited by a lack of finances or are not interested in innovation. According to the responses most innovation ideas were acquired from various sources – guests, competition and/or employees, which is affirmative, as constant feedback from various sources is significant for business development.

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Accepting and adjusting is business aspect which needs to be worked on because respondents’ attitudes are divided. Although more than one third of respondents have trouble in accepting changes, not a negligible percentage claim that they analyse the market possibilities, keep track of the competition and act in accordance with it.

It can be concluded that the innovation dimension is present in management of farmsteads to a certain extent. However, improvements can be made, primarily in the business aspect which is related to managing changes. Thus it is necessary to anticipate the changes and act proactively. Also, constant market tracking and quick assimilation and reaction to emerging opportunities and threats is significant.

As far as the knowledge management dimension is concerned, it is concerning that a surprisingly large percent of respondents did not attend any seminars, trainings and conferences which are relevant to business, although most of respondents consider attending educational activities to be beneficial to them and their company.

A conclusion can be drawn that it is necessary to work on the improvement of the knowledge management dimension, as different training programs are the essential component of business. Government and private companies which train human resources should initiate such development efforts, as well as the owners and the managers of the farmsteads. The education of the employees, their involvement in various trainings, workshops, seminars, conferences and gatherings may result in the increase of the knowledge quantum. In the following period these efforts may result in the improvement of the quality of offer on the farmsteads which can contribute the promotion of increasing the quality of tourist product of rural tourism of Vojvodina.

Radical innovations in the farmstead tourism cannot be expected, however smaller improvements by the employees which are involved in the process of giving services can significantly contribute to the overall guests’ satisfaction. Innovations can relate to standards related to accommodating guests, hygiene, the amount and the quality of food, treatment of guests, etc. Also farmsteads should strive for the enrichment of their offer through innovative programs which would extend and complement tourists’ stay, such as active involvement of guests in traditional work on farms, short, informative and entertaining trainings on old crafts, making and selling souvenirs, involving guests in making local gastronomic specialties, active spending time in nature which could be conceived as familiarising tourists with flora and fauna of the area, going hunting and fishing, sports and recreation tourism, etc.

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The prerequisite for successful planning and managing the development of rural tourism is reflected in active involvement of the rural community as well as partnership between numerous participants of rural tourism. Also, directing the visitors’ behaviour is one of the factors for the successful development of rural tourism in Vojvodina.

The basis for the development of rural tourism is the implementation of new knowledge which will help in developing new tourist offer. With various seminars and trainings, formal and informal educational organisations, government and non-government and other organisations should be involved in the process of the development of rural tourism, in order for the rural community to acquire new knowledge and skills. Forming rural centers should be the leading structures of sustainable rural development, and the activities of those centers would be (Stamenković, 1999): forming a development work group; the analysis and critical evaluation of the current state; examining different attitudes and opinions by surveying; suggesting possible solutions; organising meetings in rural centers; cooperating with other participants in the development on all levels (local, regional and international) and ensuring that there is constant presence in public (creating a web page, cooperation with the media and the local community).

In order to confirm the conclusions drawn from this paper, the research should be viewed from the international point of view, which means that the development of rural tourism in Serbia should be compared to the development of rural tourism in the European countries. It is also necessary to create a development program of rural tourism in the Republic of Serbia, including the Autonomous Province of Vojvodina.

Acknowledgements: This paper is the result of the project 47007 funded by the Ministry of Education, Science and Technological Development of the Republic of Serbia.

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