Advances in Hospitality and Leisure, Volume 3 (Advances in Hospitality and Leisure)

LIST OF CONTRIBUTORS Kalotina Chalkiti University of the Aegean, Chios, Greece Vinay Chauhan Centre for Hospitality ...

Author: Joseph S Chen

74 downloads 16113 Views 2MB Size Report

This content was uploaded by our users and we assume good faith they have the permission to share this book. If you own the copyright to this book and it is wrongfully on our website, we offer a simple DMCA procedure to remove your content from our site. Start by pressing the button below!

Report copyright / DMCA form

DOWNLOAD PDF

LIST OF CONTRIBUTORS Kalotina Chalkiti

University of the Aegean, Chios, Greece

Vinay Chauhan

Centre for Hospitality and Tourism Management, University of Jammu, Jammu and Kashmir State, India

Joseph S. Chen

Department of Recreation, Park and Tourism Studies, Indiana University at Bloomington, Bloomington, IN, USA

Li-Ju Chen

Department of Recreation, Park and Tourism Studies, Indiana University at Bloomington, Bloomington, IN, USA

Rachel J. C. Chen

Department of Retail, Hospitality, and Tourism Management, University of Tennessee, Knoxville, TN, USA

Hsin-You Chuo

Department of Marketing, National Chung Hsing University, Taiwan

Candice Clemenz

Pamplin College of Business, Virginia Tech, Blacksburg, VA, USA

Michael C. Dalbor

University of Nevada Las Vegas, Las Vegas, NV, USA

Marco A. Gardini

International University of Applied Science Bad Honnef-Bonn, Bad Honnef-Bonn, Germany

Li-Jen Jessica Hwang

School of Management, University of Surrey, Surrey, England, UK

Thouraya Gherissi Labben

Lausanne Hospitality Research, Ecole hoˆtelie`re de Lausanne, Lausanne, Switzerland

Seoki Lee

Temple University, Philadelphia, PA, USA

ix

x

LIST OF CONTRIBUTORS

Mehmet Mehmetoglu

Department of Tourism , Finnmark University College, Norway

Andrew Mungall

Lausanne Hospitality Research, Ecole hoˆtelie`re de Lausanne, Lausanne, Switzerland

Khaldoon Nusair

Hospitality Management, Ohio State University, Columbus, OH, USA

Kjell Olsen

Department of Tourism, Finnmark University College, Norway

H. G. Parsa

Hospitality Management, Ohio State University, Columbus, OH, USA

Steven Philipp

Hospitality, Recreation, and Resort Management University of West Florida, Pensacola, FL, USA

Bruce Prideaux

School of Business, James Cook University, Queensland, Australia

Paul D. Rompf

University of Central Florida, Orlando, FL, USA

Denver E. Severt

University of Central Florida, Orlando, FL, USA

Kimberly S. Severt

University of Central Florida, Orlando, FL, USA

Linda Sherman

Health, Leisure, and Exercise Science, University of West Florida, Pensacola, FL, USA

Marianna Sigala

Department of Business Administration, University of the Aegean, Chios, Greece

Arun Upneja

School of Hospitality Management, The Pennsylvania State University, University Park, PA, USA

AIMS AND SUBMISSION GUIDELINES Advances in Hospitality and Leisure (AHL), a peer-review publication, aims to promote seminal and innovative research outputs pertaining to hospitality, leisure, tourism, and lifestyle. Speciﬁcally, the series will encourage researchers to investigate new research issues and problems that are critical but have been largely ignored while providing a forum that will disseminate singular thoughts advancing empirical undertakings both theoretically and methodologically. The third issue includes the articles on critical literature review that discuss the shortcomings of past research and provide the guidance for future research agendas in relation to hospitality, leisure, and tourism issues. In addition, empirical papers with a new investigative theme are included. In total the issue contains 10 full papers and 4 research notes. For submission to future issues, please review the following guidelines: Originality of Manuscript: The manuscript should represent an original work that has never been published elsewhere nor is being considered for publication elsewhere. Style and Length of Manuscript: 12 pt Times Roman font; double spacing; APA; 7,000 words (Full Paper) or 4,000 words (Research Note). Layout of Manuscript: First page: title of paper and author information; second page: title of paper, 100–120 word abstract, and keywords; third page and beyond: main text, appendix, references, ﬁgures, and tables. Text of Manuscript: For literature review articles, please include introduction, critical literature review, problems in past research, and suggestions for future research. For empirical research papers, please include introduction, methods, ﬁndings and discussions, and conclusion. AHL requires electronic submission. Please use an email attachment with Microsoft Word format to the editor Dr. Joseph Chen (joechen@ indiana.edu) or send a diskette to Tourism Management Program, Department of PRTS, HPER Building ]133, Indiana University, Bloomington, Indiana 47405, USA.

xi

EDITORIAL BOARD EDITOR-IN-CHIEF Joseph Chen Indiana University, Bloomington, USA

EDITORIAL REVIEW BOARD David Botterill University of Wales Institute, Cardiff, UK

North America Rachel Chen University of Tennessee, USA

Fre´de´ric Dimanche European School of Business, France

Dogen Gursoy Washington State University, USA

Yuksel Ekinci University of Surrey, UK

Colin Johnson San Jose State University, USA

Metin Kozak Mugla University, Turkey

Anna Mattila Pennsylvania State University, USA

Marianna Sigala University of Aegean, Greece

William Norman Clemson University, USA

Helmut Wachowiak Intl. U. of Applied Sciences, Bad Honnef, Germany

Haemoon Oh Iowa State University, USA H. G. Parsa Ohio State University, USA

Asia/Paciﬁc Tzung-Cheng Huan National Chia-Yi University, Taiwan, ROC

John Williams University of New Orleans, USA Europe

Tak-Kee Hui National University of Singapore, Singapore

Marcjanna Augustyn University of Hull, UK

Bruce Prideaux James Cook University, Australia

xiii

SAFETY AND SECURITY PERCEPTIONS OF TOURISTS VISITING KASHMIR, INDIA Vinay Chauhan ABSTRACT Safety and security today, has been identified as one of the five global forces that drive the tourism industry. The topic of safety and security in the tourism industry has gained vital importance, mainly after 9/11 incident, thereafter both academicians and practitioners have started looking into crisis management issues seeking workable solutions to mitigate these negative impacts. Therefore, with a view to overcome such problems, this paper undertakes an in-depth study regarding the safety and security in Kashmir and its impact on building destination image. The conclusion suggests that safety and security is a prerequisite for an ideal destination image. Therefore, proper strategies should be formulated to minimize the negative impact of such incidents.

INTRODUCTION Kashmir is surrounded by mountains comprising of innumerable attractions, which accordingly have made tourism one of the major industries of the region. Also referred to as ‘paradise on the earth’ it has rich, interesting Advances in Hospitality and Leisure, Volume 3, 3–17 Copyright r 2007 by Elsevier Ltd. All rights of reproduction in any form reserved ISSN: 1745-3542/doi:10.1016/S1745-3542(06)03001-3

3

4

VINAY CHAUHAN

and a great wealth of geographical, anthropological, historical and cultural tourist attractions. Situated in the northern most part of India, it is spread over an area of about 150 km in length and 80 km in width. Interestingly, it offers bracing climate and landscape, enchanting the visitors with its green carpet for half of the year. Its lofty mountains, limpid lakes, vast green meadows together with its cool climate have been attracting the tourist the world over. Kashmir is the best place in Himalayas. In fact, Kashmir is to Himalayas, what Switzerland is to Alps. ‘Kashmir only Kashmir’ were the last words uttered by one of the most majestic Mughal Emperors – Jehangir. Its long and rich history includes a proud intellectual heritage, which is even admitted by Pt. Jawahar Lal Nehru, who says that Kashmir has been one of the biggest seats of Indian culture and learning throughout history (Shaﬁ, 1994, pp. 48–49). Rightly pointed by Lawrence, the valley contains everything, capable of making life enjoyable, there are spot varied and excellent, there is scenery for the artist and layman both, mountain for the mountaineer, ﬂowers for the botanist, vast ﬁelds for the geologist and magniﬁcent ruins for the archeologist (Lawrence, 1967, p. 14). All these resources together make Kashmir an ideal tourist destination that has an inherent strength and huge potential to attract almost every type of tourist. Kashmir, despite of gaining popularity as a major tourist destination, the last two decades have hindered the smooth growth of tourism industry because of the spread of the militancy, which has discouraged travelers for visiting India’s most beautiful tourist destination (Chauhan & Khanna, 2005, p. 102). To supply the shortcomings of the current literature, the present study is to evaluate terrorism issue in the Kashmir region. It also aims at the following objectives (1) to study the tourists’ perception of safety and security while visiting Kashmir; (2) to measure the change between the pre- and post-tour perception of safety and security conditions; and (3) To suggest the ways and measures to improve the safety and security conditions and reduce the impact of terrorism on building negative image of Kashmir as a tourist destination. The evidence from the various researches suggests that safety and security are necessary conditions for a prosperous tourism industry. Researchers such as Pinhey and Iverson (1994), Lankford (1996), Cohen (1987), Bloom (1996), Tarlow and Muehsam (1996), Pizam and Mansfeld (1996), Sonmez and Graefe (1998), Sonmez (1998) and Levantis and Gani (2000) have written about how crime, terrorism and violence negatively affect the tourism industry. Terrorism may be deﬁned as a systematic use of terror as a means of coercion (Wall, 1996, p. 143). ‘It is a systematic and persistent strategy

Safety and Security Perceptions of Tourists Visiting Kashmir, India

5

practiced by a state of political group against another state, political or social group through a campaign of acts of violence such as assassination, high jacking, use of explosive, sabotage and murder with an intention of creating a state of terror and public intimidation to achieve political, social or religious objectives’ (Wahab, 1996, pp. 176–177). In recent years, researchers have become interested in understanding the relationship between tourism and terrorism and its impact on tourist destinations. In fact, the researches about the relationship between tourism, terrorism and criminal acts affecting tourist’s safety perceptions have pointed out that with risk perceptions when safety concerns are introduced, they are likely to become overriding factors altering the context of conventional decision-making models and causing travelers to amend travel plans. A common ﬁnding of this literature is that safety and security of tourists is a prerequisite for a prosperous tourist destination. Indeed, Sonmez and Graefe (1998, p. 120) claimed ‘if the destination choice is narrowed down to two alternatives which promise similar beneﬁts, i.e. one which is less costly and other that is safe from threat, the safer even if it is costly is likely to be chosen’. Pearce (1988, p. 28) suggested that ‘concern with personal security is a major factor in the decision-making process through which individuals make their travel choices’. Several authors, on the other hand have suggested that residents and tourists have an equal chance of becoming a victim. It can be claimed that crime is an irrational concern and visitor have an equal chances of being involved in a fatal car accident of suffering household injury at home. The critical factor, therefore, is fear of the unknown, and the risk. Sonmez (1998, p. 120) in her research on terrorism and tourism has pointed out that the introduction of risk into touristic decisions has the potential to disrupt routine decision-making. Terrorism not only affects the decision of where to travel but also inﬂuences the choices regarding mode of transport and in some cases, whether to travel at all or not (Hall, 2002, p. 458). These issues have long been recognized as a factor, which inﬂuences tourist’s decision-making (Hall & Sullivan, 1996). There is no doubt that there has been a certain degree of cancellation and reduced bookings in terms of travel to many destinations. But at the same time there may still be a certain degree of nervousness associated with traveling, tourism is an incredibly resilient industry (Mabudafhasi, 2003). Moreover, it also plays major part in informing the consumer about the images of destinations and transport modes, their relative safety and security either directly in terms of being read, heard or watched or indirectly

6

VINAY CHAUHAN

through the advice given by the friends, relatives and source of ‘word of mouth’ information (Fodness & Murray, 1997, p. 459). So, these activities result in building up of negative image of a destination. Buckley and Klemm have highlighted that the problems of any kind of civil unrest is that unfavorable images are beamed across the world, so that even those who are not afraid of terrorism will be discouraged from taking holiday there. It is not so that the area is dangerous; moreover it does not look attractive (Buckley & Klemm, 1993). In fact, safety and security has been identiﬁed as one of the ﬁve global forces that would drive the tourism industry in the new millennium. The topic of safety and security in the tourism industry has gained vital importance globally, mainly after 9/11 incident, both academics and practitioners have started looking into crisis management issues seeking workable solutions in order to mitigate the negative impacts of safety and security incidences (Chiang, 2000). Even, the international community has widely accepted that the success of the tourism industry directly linked to its ability to offer tourists a safe and pleasant visit. It does not make sense to spend millions on marketing campaigns if the potential tourists are afraid to visit the country or region selected. From this, we can infer that countries facing security problems affecting tourists should make a serious effort to try to resolve the main obstacles and problems (Inter-American Travel Congress, 1997). Even the World Tourism Organization (WTO) and the White House Conference on Travel and Tourism (WHCTT) have emphasized the prevention of the violent acts against tourists is the joint responsibility of the tourism industry and the public sector. The WTO, in its best practice manual on Traveler Safety and Security (World Tourism Organization, 1995), and the WHCTT have reinforced this opinion. Objective 5 of the WHCTT calls for ‘mobilizing the industry to respond to the concerns about traveler safety and security, through community partnerships and disaster preparedness programmes. The traveler Safety Task Force of the WHCTT recommends adopting guidelines such as those published by WTO that provide for the safe handling of the visitors y. And IACVB, in cooperation with the National Conference of Mayors and National law enforcement organizations, should develop guidelines for the development of the Community Safety Plans’ (White House Conference on Travel and Tourism, 1995, pp. 18–20). The WTO has also suggested ‘Every state should develop a National Policy on tourist safety commensurate with the prevention of tourist risks’ (WTO, 1991). That is why we need to pay greater attention to the analysis of the root cause of terrorism, which requires long-term commitment and investment by

Safety and Security Perceptions of Tourists Visiting Kashmir, India

7

all of us; and a greater resolve for uncompromised enforcement and security to prevent breaches from occurring today (Comito, 2002). It is clear from the above discussed literature review that tourism being the most sensitive industry is badly affected by terrorism, as it has enormous impact on the travel pattern. The tourism industry in Kashmir has had a major setback as the valley has been badly affected by terrorism especially during the last two decades. This claim may be supported by the statistics of various terrorist activities in the valley especially during the last two decades (Table 1). Therefore, it can be assumed that Kashmir has developed a partial image of being an unsafe place to visit. So, on the basis of this hypothesis, an attempt through this paper has been made to conduct an in-depth study regarding the safety and security in Kashmir.

METHODOLOGY The study is based on primary data. The data for the study are collected through a convenient sample survey of tourists visiting Kashmir during the various seasons in one year, i.e. from January 2005 to March 2006. For the survey, a total of 350 tourists visiting Kashmir were approached, which represents approximately 0.1% of the total universe, i.e. tourist visited Kashmir in the year 2005. Out of the total selected samples of 350, 213 tourists (60.8%) agreed to participate in the survey and returned the completed questionnaire. The survey was conducted at the various tourist attractions and accommodation units in Kashmir valley. These locations were chosen as it was felt that they could provide a reasonable representations of the target population, i.e. tourists visiting Kashmir. The survey instrument was self-administered, two part questionnaire. The questions in the ﬁrst part of the survey asked about respondent’s sociodemographics, i.e. gender, marital status, qualiﬁcation, state of origin, traveling in single/group and purpose of journey. In second part, 7-item safety and security index was developed keeping in view the various considerations and factors of the study area. The 7-item index included the opinion of the tourist in terms of safety and security vis-a`-vis transportation facilities, hotel and other lodging facilities, behavior and attitude of local people and administration, while visiting tourist places including other leisure activities and ﬁnally overall perception of Kashmir as a tourist destination. To evaluate perceptual change in the behavior of the tourist pre- and post-tour perception is also sought from the tourist in the last part

8

VINAY CHAUHAN

Table 1.

Major Terrorist Activities in the Kashmir Valley during the Last Two Decades.

Period 11 April 1988 11–12 September 1988 13 July 1989 13 December 1989 11 February 1990 26 January 1992 24 April 1993

29 March 1994 26 January 1995 24–30 March 1996

June 1998 6 May 1999 26 May 1999 24–31 December 1999 11 30 24 21

September 2001 March 2002 November 2002 July 2003

30 August 2003 3 March 2004 October 2005 23 December 2005 9 April 2006 14 April 2006

Terrorist Activity Explosion in an ammunition dump at Objeri (Pak) followed by violent incidents in Valley First batch of Pak trained youths arrested Killing of 3 CRPF persons in Srinagar in the ﬁrst organized attack on Para-military forces Release of Dr. Rubaiya Sayeed in exchange of ﬁve hardcore militants Violation of the LOC by a Pakistani Mob at Uri (Baramulla) Unfurling of the National Flag in Srinagar by the BJP marking the conclusion of ‘Ekta Yatra’ Indian Airlines aircraft bound for Srinagar via Jammu from Delhi hijacked. Militants wanted to take the plane to Lahore but were refused by Pak Aviation authorities Blast in Badami Bagh Cantonment killing 13 Army ofﬁcers including a Major General Blasts during Republic Day function at MAM Stadium, Jammu Armed Militants entered the Hazratbal Shrine and later vacated peacefully. Encounter with the police resulted in the death of 32 militants and one police personnel Signiﬁcant increase in ﬁring from the Pakistan’s side of LOC Indian Army launched operations to evict the Pak inﬁltrators Indian Air Force launched air strikes in Kargil area with, operation ‘Vijay’ started Delhi-bound Indian Airlines IC-814 was hijacked from Kathmandu and was taken to Kandhar by the HUA activists Terrorist attack on the Pentagon in New York city Militant attack on Raghunath Temple, Jammu Another Militant attack on Raghunath Temple Attack on Langer at Ban-Ganga, on the way to Shri Mata Vaishno Devi Shrine, Katra Security forces killed mastermind behind Parliament attack, Ghazi Baba and his associates in an encounter in Srinagar Five killed in suicide attack on Jammu jail Five killed in suicide attack in Srinagar One blast at Srinagar airport Body of missing Taiwanese tourist ﬁshed out of Dal Lake Srinagar 5 civilians killed and 44 injured when militants struck with 7 grenade blast in Srinagar

Source: Data collected from various Magazines, Journals and Newspapers and Websites.

Safety and Security Perceptions of Tourists Visiting Kashmir, India

9

of the questionnaire. For each item respondents used 5-point Likert scale to rate their perception, i.e. 1–5 scale, where 1 ¼ unsafe and 5 ¼ very safe. The statistical techniques used for the analysis of the data include percentage method, mean, standard deviation, ‘t’ test, correlation and multiple regression. The percentage method is used for explaining the description of the respondents. Mean and standard deviation are used to explain the safety perceptions of the tourist collected on 5-point Likert scale. The ‘t’ test is used as a test of signiﬁcance for the signiﬁcantly different scores of safety and security perceptions on the basis of demographic groups. The multiple correlation and multiple regression techniques have been applied to study the joint inﬂuence of selected group variables on the overall safety and security perception.

DISCUSSIONS AND FINDINGS The study is limited to the tourists visiting Kashmir. A proﬁle of the respondents is depicted in Table 2. Of the 213 respondents 153 (71.83%) are Table 2.

Demographic of the Respondents.

Description

No. of Respondents

Percentage of Respondents

(a) Gender Male Female

153 60

71.83 28.17

(b) Marital status Single Married

30 183

14.08 85.92

(c) Qualiﬁcation Undergraduate Graduate and above

109 104

51.17 48.83

(d) State of origin J&K Outside J&K

11 202

5.16 94.84

(e) Traveling Single Group

27 186

12.68 87.32

(f) Purpose of journey Holiday and leisure Business

114 99

53.52 46.48

10

VINAY CHAUHAN

males and rest 60 (28.17%) are females. On the bases of marital status, majority of the respondents, i.e. 183 accounting for 85.92% are married as compared to singles, who are 30 (14.08%). The educational qualiﬁcation has almost equal numbers in subgroups, i.e. 109 (51.17%) undergraduates as compared to 104 (48.83%) respondents who are graduates and above. The table also indicates that more non-J&K (94.84%) tourists are surveyed in the study compared to locals, but it is not surprising as the questionnaires were distributed at the various tourist attractions and accommodation units, which attract more holiday and leisure tourists as compared to local people. It also indicates that the destination has good touristic appeal to attract signiﬁcant number of tourists from outside the state. Further, majority of the respondents surveyed in the study are traveling in groups which forms 87.32% of the total respondents, and merely 12.68% are traveling singles. Out of the total number of respondents, 53.32% expressed holiday and leisure as their purpose of journey, which may again be owing to the selected points for data collection (Table 2). Table 3 depicts the assessment of safety and security by tourist in Kashmir. Seven variables based on various activities undertaken by the tourists visiting various places are identiﬁed and were asked to express their opinion regarding safety and security perceptions while performing these identiﬁed activities. Various activity-based variables used in the study regarding the Table 3.

Assessment of Perceived Safety by Tourist in Kashmir. M

SD

A. Transportation V1 Transport engaged to reach Kashmir V2 Local transport engaged to visit tourist places

3.55 3.82

0.82 0.90

B. Accommodation V3 While staying in hotel and other accommodation units

4.3

0.78

C. Local V4 Behavior and attitude of local people and administration

4.18

0.86

4.16 3.81

0.83 0.94

4.05

0.93

Perception Variables

D. Visiting tourist places and performing leisure activities V5 While visiting tourist places and attractions V6 While performing other leisure activities such as shopping, adventure, roaming and photography E. Overall perception V7 Overall perception of Kashmir as a tourist destination

Note: 1 ¼ very unsafe, 2 ¼ a bit unsafe, 3 ¼ average, 4 ¼ fairly safe and 5 ¼ very safe.

Safety and Security Perceptions of Tourists Visiting Kashmir, India

11

safety and security are: transport engaged to reach Kashmir (V1), local transport engaged to visit tourist places (V2), while staying in hotel and other accommodation units (V3), behavior and attitude of local people and administration (V4), while visiting tourist places and attractions (V5), while performing various tourism and other leisure activities (V6), and ﬁnally, overall perception of Kashmir as a tourist destination (V7). Respondents were given 5-point Likert scale to assert their opinion, where 1 ¼ very unsafe, 2 ¼ a bit unsafe, 3 ¼ average, 4 ¼ fairly safe, and 5 ¼ very safe. Table 3 indicates that tourists felt the safest while staying in accommodation units (mean ¼ 4.3), whereas transport engaged to reach Kashmir has lowest safety perception with a mean value of 3.54 (lowest). The mean value of other variables are behavior and attitude of local people and administration (V4) ¼ 4.18, while visiting tourist places and attractions (V5) ¼ 4.16, overall perception of Kashmir as a tourist destination (V7) ¼ 4.05, local transport engage to visit tourist places (V2) ¼ 3.82 and while performing various tourism and other leisure activities (V6) ¼ 3.81. Interestingly, the mean values of all the variables is found above the mid-value (d ¼ 3), which indicates that tourists feel safe in Kashmir while performing various tourism related activities. Table 4 indicates signiﬁcantly different scores of overall perception of safety and security regarding Kashmir as a tourist destination (V7) on the basis of various socio-demographic variables taken up in the study, which are gender, marital status, qualiﬁcation, state of origin, traveling in single or group and purpose of journey. On the basis of gender, females felt Kashmir as a safer destination in comparison to their male counterparts, i.e. female scored 4.28 whereas males scored 3.96 (t test ¼ 2.67, po0.01). In terms of purpose of journey, the visitors traveling for business accorded Kashmir as a safer destination as they scored 4.22 as compared to visitors (tourist) traveling for holiday and leisure X ¼ 3.89, t test ¼ 2.76 signiﬁcant at 0.01, i.e. po0.01. Taking into consideration the qualiﬁcation of the respondents, the graduate and the undergraduate score 4.18 and 3.92, respectively, with po0.05. The other demographic groups, i.e. marital status, state of origin and single versus group traveling were found insigniﬁcant at 5% level and has recorded mean values as 4.1 for single and 4.038 for married with t ¼ 0.38; from J&K ¼ 3.90 and outside ¼ 4.05 with t ¼ 0.83; visitor traveling individually/single ¼ 4.0370 and group ¼ 4.04 with t ¼ 0.07. In Tables 5 and 6 multiple correlation and multiple regression techniques have been applied to study the joint inﬂuence selected group variables on the overall safety and security perception. All the identiﬁed variables (V1–V6) were grouped into four major categories on the basis of similarities of the

12

Table 4.

VINAY CHAUHAN

Overall Perception of Safety and Security (V7) on the Basis of Demographic Groups.

Description

N

M

SD

t

(a) Gender Male Female

153 60

3.96 4.28

0.92 0.76

2.67

(b) Marital status Single Married

30 183

4.1 4.04

0.80 0.90

0.38

(c) Qualiﬁcation Undergraduate Graduate and above

109 104

3.92 4.18

0.92 0.83

2.20

(d) State of origin J&K Outside J&K

11 202

3.91 4.05

0.54 0.90

0.83

(e) Traveling Single Group

27 186

4.04 4.05

0.81 0.90

0.07

(f) Purpose of journey Holiday and leisure Business

114 99

3.89 4.22

0.95 0.78

2.76

Note: 1 ¼ very unsafe, 2 ¼ a bit unsafe, 3 ¼ average, 4 ¼ fairly safe and 5 ¼ very safe. pr0.05. pr0.01.

activities, i.e. transportation (T ¼ V1 & V2), accommodation (A ¼ V3), local (L ¼ V4) and visiting tourist places and performing leisure activities (VTP&LA ¼ V5 & V6) and overall (OA ¼ V7). The regression co-efﬁcients have been tested with the help of most popular ‘t’ test. In the study, transportation (V1 & V2), accommodation (V3), local (V4) and visiting tourist places and performing leisure activities (V5 & V6) have been taken explanatory variable, whereas overall perception of Kashmir as a tourist destination (V7) has been used as dependent variable. Table 5 shows a positive but very less degree of correlation between selected variables. The regression model used in the analysis is OA ¼ a+b1Trp b2Ac+b3 VTP&LA+b4 L, where, a+b1, b2, b3 and b4 are the parameters of overall perception line. Table 6 shows the strength of relationship between the dependent variable OA and all the independent variables taken together and also the impact of these independent variables

Safety and Security Perceptions of Tourists Visiting Kashmir, India

13

Table 5. Overall Perception (V7) on Transportation (V1 and V2), Accommodation (V5), Visiting Tourist Places and Leisure Activities (V3 and V4) and Local (V7). Variable

Regression Standard t-Value Coefﬁcients Error

Transportation 0.150718 Accommodation 0.19

0.08 0.08

VTP&LA

0.30

0.07

Local

0.50

0.08

Multiple Correlation

2.00 Tabulated values Co-efﬁcient of overall 2.30 for t at 0.05, 0.01 on transportation, and 0.001 levels accommodation, of signiﬁcance local and VTP&LA ¼ 0.583816 are 1.96, 2.32 4.32 and 2.57, Multiple correlation of respectively determinant (R2) ¼ 0.340842 6.29 Adjusted R2 ¼ 0.328166 standard error of R ¼ 0.728635

Note: 1 ¼ very unsafe, 2 ¼ a bit unsafe, 3 ¼ average, 4 ¼ fairly safe and 5 ¼ very safe.

pr0.05. pr0.01. pr0.001.

Table 6.

Transportation Accommodation Visiting tourist places and performing LA Local Overall

Correlation Matrix.

Transportation

Accommodation

Visiting Tourist Places and LA

1.00 0.38 0.23

1.00 0.50

1.00

0.29 0.25

0.51 0.24

0.46 0.44

Local

Overall

1.00 0.52

1.00

on OA. When transportation is increased by one unit, the OA increases by 0.15, which is statistically signiﬁcant at 0.01 level. For one unit increase in accommodation, the OA perception decreases by 0.194, which is signiﬁcant at 0.05 level. When local is increased by one unit, OA increases by 0.31, which is signiﬁcant at 0.001 level. Further, when one unit is increased in VTP&LA the OA increases by 0.51 which is highly signiﬁcant at 0.001 level. The multiple correlation co-efﬁcient between the dependent variable OA and independent variables like transportation, accommodation, local and

14

VINAY CHAUHAN

VTP&LA (R ¼ 0.58) indicates that OA is inﬂuenced by independent variables. It is also evident from the value of R2 ¼ 0.34 of variation in OA is accounted by the joint variables of transportation, accommodation, locals and VTP&LA. Most tourism–terrorism research till date is limited to the effect of terrorism on tourist destinations that too in terms of tourist trafﬁc only, rather than taking a sample of tourists and examining their perception of safety and security. Present study is an attempt to examine the effect of terrorism in building image of Kashmir as a tourist destination with regard to safety and security. During the study it has been observed that the Kashmir valley is affected by the terrorism. Therefore it can be inferred that if it continue with the same intensity, it can have serious implications on the tourism industry in terms of tourist trafﬁc, state economy, multiplier, income of local people, local participation and infrastructure and superstructure. But, interestingly, the study appears to demonstrate that tourists visiting Kashmir valley have reasonably positive perceptions, which has led the researcher to reject the hypothesis that Kashmir has a partial image of being an unsafe destination as the mean value of all the safety and security variables taken in the study were found above mid value, i.e. three in ﬁve point Likert scale. However, out of the various variables the safety perception among the tourists has been found lowest with respect to transport engaged to reach Kashmir. Since transportation is the most important factor for the success of any tourist destination, it is recommended that adequate security measures should be taken by the security agencies in coordination with various public and private organizations involved in tourism and transportation process, so as to make tourists feel safe. Further, the study points out that of the various components of tourist destination, behavior of local people and administration at tourist places needs more attention and improvement as it has more impact on overall perception of image of the destination (Table 7). Table 7.

Change in Perception.

Perception Variable V8 Pre-tour perception of Kashmir as a tourist destination V9 Post-tour perception of Kashmir as a tourist destination

N

M

SD

t

189

3.11

1.10

18.61

201

4.54

0.66

Note: Change ¼ mean (post-visit) – mean (pre-visit), e.g. 4.543.11 ¼ 0.43. pr0.001.

Safety and Security Perceptions of Tourists Visiting Kashmir, India

15

CONCLUSION The study has also measured the change in pre- and post-tour perception and it has been found that safety perception has changed positively and improved after visiting the destination, which indicates that all the communication agencies including media are playing negative role in projecting destination image. Some respondents pointed out that sometimes even a single terrorist activity is highlighted by the media to such an extent that forces the government, embassies, travel organizations to pass instructions and travel restrictions. Further, on the basis of the various suggestions given by the respondents, it is pointed out that industry must join hands with security and law enforcement agencies for safety. And, tourism operators should take all the necessary steps to prevent tourists being affected by the various terrorist and criminal activities directly or indirectly. In the discussion, it was also suggested by some of the respondents that to solve these repeated problems that have been encountering in area under study; the governments should adopt a policy based primarily on two approaches. The ﬁrst approach should be preventive and the other involves direct protection of the visitors. As a part of ﬁrst approach, a series of pamphlets focusing on prevention should be designed and be distributed to the tourists at the various entry points, at the major hotels. The characteristic and the content of these publications should include important information, published in different languages about security, safe places to visit and places to avoid, precautions to be taken while walking around the city and where to get help in the event of problem. The publication and circulation of these pamphlets would of course not only help in solving security problems affecting various areas in certain circumstances, but they would also help in reducing crimes involving tourists, since they focus on preventive action that puts possible victims on alert, and so they would tend to diminish the success of these activities. Further, the tourist police should be given the following functions: provide information and guidance to tourists; prevent crime and terrorist activities; protect both visitors and residents; respond to tourists’ complaints, giving them guidance as appropriate; provide liaison with consulates, embassies and other ofﬁces related to tourist origin; and combat trafﬁcking in religious and/or colonial objects, and in drugs.

16

VINAY CHAUHAN

It is suggested that law enforcement agencies, security agencies and tourism organizations should work with the industry to train and assist operations and people involved in tourism industry for the prevention and reduction of terrorism activities vis-a`-vis their impact on building a destination image. However, it worthwhile recognizing that the above discussions could be undermined by the study limitation pertaining to a limited sample size of 213. Lastly, the following suggestions are recommended for the future studies: (1) A separate study could be conducted to measure the effect of media on building destination image. Such studies can be supported with the longitudinal surveys to evaluate the extent of change of perception upheld by the tourist. (2) Perception of locals can also be included in the study as their behavior and attitude also effects building tourists’ perceptions. (3) A separate study can be undertaken to assess the level of coordination between the various security and enforcement agencies and their impact in building tourists’ perception. (4) Controlling all the variables and taking all the precautions to minimize the impact, what is the level of change of perception? (5) An attempt can also be made to study the relationship between the perceptions, destination image and travel decisions. (6) Comparative studies can be made to the various destinations having similar situations.

REFERENCES Bloom, J. (1996). A South African perspective of the effects of crime and violence on the tourism industry. In: A. Pizzam, & Y. Mansfeld (Eds), Tourism, crime and international security issues (pp. 91–102). London: Wiley. Buckley, P. J., & Klemm, M. (1993). The decline of tourism in Northern Ireland: The causes. Tourism Management, 14(3), 184–194. Chauhan, V., & Khanna, S. (2005). Terrorism and tourism in J&K: An empirical study. Tourism Development Journal, 2(1), 102–110. Chiang, L. C. (2000). Strategies for safety and security in tourism: A conceptual frame work for Singapore Hotel Industry. Journal of Tourism Studies, School of Cuisines Cook University, 11(2). Retrieved from http://www.jeu.edu.au/fac1/public/business/jts/v11N2. Cohen, E. (1987). The tourist as victim and prote´ge´ of law enforcing agencies. Leisure Studies, 6(2), 181–198. Comito, F. (2002). Impact of terrorism and crime on tourism in far reaching. Bahamas commentary September 11. Retrieved from http://www.bahamasb2b.com/news/wmview.

Safety and Security Perceptions of Tourists Visiting Kashmir, India

17

Fodness, D., & Murray, B. (1997). Tourist information search. Annals of Tourism Research, 24(3), 503–523. Hall, C. M., & O’Sullivan, V. (1996). Tourism, political instability & social unrest. In: A. Pizam, & Y. Mansfeld (Eds), Tourism, crime and international security issues (pp. 105–21). London: Wiley. Hall, M. C. (2002). Travel safety, terrorism & the media: The signiﬁcance of the issue-attention cycle. Current Issues in Tourism, 5(5), 458–466. Inter-American Travel Congress. (1997). Sustaining tourism by managing safety and security at the destinations. Washington, DC: Organization of American States. Lankford, S. (1996). Crime and tourism: A study of perceptions in the Paciﬁc Northwest. In: A. Pizam, & Y. Mansfeld (Eds), Tourism, crime and international security issues (pp. 105– 121). London: Wiley. Lawrence, W. (1967). Valley of Kashmir. Srinagar, India: Kesar publishers. Levantis, T., & Gani, A. (2000). Tourism demand and the nuisance of crime. International Journal of Social Economics, 27(7/8/9/10), 959–967. Mabudafhasi, H. R. (2003). Western Cape Provincial safety and security Tourism Conference, 15 Oct. Retrieved from http://www.info.gov.za/speeches/2003. Pearce, P. L. (1998). The Ulysses factor: Evaluating visitors in tourist settings. New York: Springer. Pinhey, T. K., & Iverson, T. J. (1994). Safety concerns of Japanese visitors to Guam. Journal of Travel and Tourism Marketing, 3(2), 87–94. Pizam, A., & Mansfeld, Y. (1996). Tourism, crime and international security issues. London: Wiley. Shaﬁ, M. (1994). Tourism dynamics in a developing economy. Srinagar, India: Gulshan Publisher. Sonmez, S. F. (1998). Tourism, terrorism, and political instability. Annals of Tourism Research, 25(2), 416–456. Sonmez, S. F., & Graefe, A. R. (1998). Inﬂuence of terrorism, risk on foreign tourism decisions. Annals of Tourism Research, 25(1), 112–144. Tarlow, P., & Muehsam, M. (1996). Theoretical aspects of crime as they impact the tourism industry. In: A. Pizam, & Y. Mansfeld (Eds), Tourism, crime and international security issues. London: Wiley. Wahab, S. (1996). Tourism & terrorism: Synthesis of the problem with emphasis on Egypt. In: A. Pizam, & Y. Mansfeld (Eds), Tourism, crime and international security issues (pp. 175– 186). London: Wiley. Wall, G. (1996). Terrorism and tourism: An overview and an Irish example. In: A. Pizam, & Y. Mansfeld (Eds), Tourism, crime and international security issues (pp. 143–158). London: Wiley. White House Conference on Travel and Tourism. (1995). Proposed national tourism strategy. Washington, DC: US. Travel and Tourism Administration. World Tourism Organization (WTO). (1991). Recommended measures for tourism safety. Madrid: Author. World Tourism Organization (WTO). (1995). Best practice manual on traveler safety and security: Recommended measures for tourism safety. Madrid: Author.

FROM CULTURAL CONSUMER AT HOME TO HERITAGE TOURIST AWAY Mehmet Mehmetoglu and Kjell Olsen ABSTRACT The objective of the current study was to examine the relationship between visitation patterns of museums at home when compared to museums visited on holidays taken. The data were collected from a sample of residents of Alta, a fjord town in northern Norway. A multiple discriminant analysis was first conducted to ascertain the factors that increased the probability of visiting a museum at home. The variables that correlated significantly with the discriminant function were collectively named ‘‘cultural consumption’’. Subsequently, a bivariate correlation analysis was performed in order to examine the relationship between the significant discriminant function and the frequency of visits of the same sample to museums on their holidays. Theoretical and practical implications of the study are also discussed.

INTRODUCTION As a tourist area, Northern Norway is characterised by ‘‘low-density’’ manmade attractions. Using Leiper’s (1990, p. 374) terminology, the primary attractions that draw international tourists to the region are mainly the Advances in Hospitality and Leisure, Volume 3, 19–37 Copyright r 2007 by Elsevier Ltd. All rights of reproduction in any form reserved ISSN: 1745-3542/doi:10.1016/S1745-3542(06)03002-5

19

20

MEHMET MEHMETOGLU AND KJELL OLSEN

immensity of nature, the Midnight Sun, and in the case of Finnmark, North Cape (Viken, 2000). Among other attractions few are targeted directly at what is usually regarded as the tourist market. Hence, many local festivals and cultural institutions like museums have a relatively large number of tourists as visitors. Even if large museums in major cities have increasingly gained attention as important for tourism and for those fundamental processes that convert cities into landscapes of cultural consumption (see, for example, van Aalst & Boogaarts, 2002), less attention has been paid to small local cultural institutions in rural areas. The current study ﬁlls this void by providing an example from a local museum in a rural area situated in Northern Norway. Local cultural events and public institutions have as their primary aim to serve local or regional populations. Additionally, most such predominantly public funded events and institutions have – as in the case of local museums – as one of their subordinate goals to also cater for tourists (Kulturdepartementet, 1996, pp. 111–112). Museums, understood as ‘‘meeting places’’ in Norwegian cultural policy, therefore become integrated in an economic policy that increasingly aims to integrate cultural production as an area of investment (Kulturdepartementet, 2005). It is not unusual that many tourist attractions also have a relatively large proportion of visitors which, if ordinary deﬁnitions are applied, are locals rather than tourists. Usually a tourist is deﬁned as a person on travel away from home. This emphasis on physical movement – economically important for huge parts of the tourist industry – renders a sharp distinction between types of museum visitors, a distinction that for museums is important in some areas and irrelevant in others. In a review of the conceptual development of tourist experience research, Uriely (2005) claims that one of the developments that emerges is:‘‘y a reconsideration of the distinctiveness of tourism from everyday life experiences y’’ (p. 200). Such a perspective has been emphasised by Franklin (2003), who claims: These formal deﬁnitions, driven by the desire to quantify and to measure the performance of the tourism economy, not only denude tourism of some of its more interesting and important characteristics, they tend to reduce tourism to acts of leisure and recreation at the end of acts of travel (pp. 27–28).

This perspective might well be integrated in, among others, Ritzer and Liska’s (1997), perspective on modern societies increasing development into modes of production and consumption that also well suit international tourism. As Wang (2000) puts it: ‘‘It can be argued that contemporary society has witnessed a process of touristification, a socio-economic and socio-cultural process by which society and its environment have been

From Cultural Consumer at Home to Heritage Tourist Away

21

turned into spectacles, attractions, playgrounds, and consumption sites’’ (p. 197). This mode of production of experiences in relation to cultural activities is probably something that characterises cultural experiences and leisure in general and often does not set tourism apart as different from everyday experiences (Franklin, 2003, p. 32). Not to push this perspective too far, we will argue that, from some angles, cultural consumption ‘‘at home’’ and ‘‘away’’ do not necessarily differ dramatically. Such consumption relates to who consumes what, as well as the ways in which people prefer to consume. Therefore, a better understanding of individuals’ cultural preferences of consumption at what appears to be ‘‘at home’’ can give tourist attractions valuable information about their preferences ‘‘on tour’’. The cultural consumer at home becomes the heritage tourist when away. At the same time, the similarities and differences that emerge from deﬁnitions that take physical movement into consideration can give cultural institutions a better understanding of how and where to differentiate an audience. Much research on museums points out that the adult museum visitor is usually well educated with a high income to match. Concerning the socioeconomic position of museum visitors in Norway, there is a dominance of medium-to-high status white-collar workers, together with disproportionate numbers of college students and school children. For local museums it is important to note that the difference in visitor frequency between socioeconomic categories is highest in art galleries and natural science museums. It is lowest in the case of cultural historic museums that are the dominant category for local Norwegian museums (Kulturdepartementet, 1996, pp. 102–103). A similar pattern is found among frequent visitors in England. Middleton (1990, p. 15) points out that about a third of museum visitors are frequent users. Prince and Higgins (1992, p. 98) quoted in Hooper-Greenhill (1994, p. 66) identiﬁes a core of relatively frequent visitors. Their socio-economic positions compare well with the foregoing Norwegian ﬁndings. These empirical data ﬁt well with a more theoretical approach connecting museum visiting to social class and taste, and their transmission between generations (Bourdieu, 1986, p. 272ff.). As Bourdieu and Darbel (1991) put it: Museum visiting increases very strongly with increasing level of education, and it is almost exclusively the domain of the cultivated classes. The proportion of the different socio-economic categories in the French museum public is almost exactly the inverse of their proportion in the total population (pp. 14–15).

This expression primarily based on research of larger art galleries cannot necessarily be transferred to local museums of cultural history. Hence, Fyfe and Ross (1996, p. 133) demonstrate that local museums can also be

22

MEHMET MEHMETOGLU AND KJELL OLSEN

analysed as spaces that visualise social relations as well as spaces where the social organisation of visual capacities takes place. ‘‘Thus class formation occurs through the medium of locality to produce different types of gaze y’’ (Fyfe & Ross, 1996, p. 148). All in all, it seems reasonable to suggest that local museums also give preference to a certain social class and a certain gaze or, as we suggest, a way of cultural consumption. Research in Norway and England shows that museum visits are something certain people do in their leisure time because of their interest in the exhibits, while visits for purposes of entertainment or on holiday is the second most common reason (Kulturdepartementet, 1996, p. 101; HooperGreenhill, 1994, p. 67). The ﬁeld of museum research also ﬁnds it useful to distinguish visitors according to their propensity to travel. Since the 1970s, the ideas of eco-museum – or new museology – have become a critical voice against the traditional museum that aims for a general audience. They argue that a consequence of the policies of the traditional museum is that such a museum (despite aiming for a general audience) mainly enters into dialogue with a certain social class. By contrast, an eco-museum should direct its’ attention towards a speciﬁc audience, usually locals who also should participate in the development of the museum (Poulot, 1994, p. 71ff.). According to those theories that focus on the purpose of museums, such divisions among the audience might be appropriate. Nevertheless, we want to raise the question of whether this dividing factor – local versus tourist – is enlightening when it comes to the core of relatively frequent visitors. Research Objectives (1) To ascertain some of the factors that could predict the visit frequency (visitor groups) of a sample of residents to a local heritage museum. (2) To the relationship between these inﬂuential factors (a composite variable) and visit frequency of the same sample to museums when they were on holiday.

METHODOLOGY Research Area Alta is the largest town in Finnmark, the northernmost county in the subarctic area of Norway. Even though the population does not exceed 19,000 inhabitants, it constitutes 23% of the county. The majority, approximately 12,000 people, live in the town centre. Newcomers are an important part of Alta. Since the 1960s the town has

From Cultural Consumer at Home to Heritage Tourist Away

23

undergone more or less continuous growth. This is something quite extraordinary in Finnmark, where most towns and municipalities during this period have experienced a decrease in population. The increase in population is due to Alta’s development into an educational and commercial centre in the western part of the region. Both people from the southern part of the country and other places in the north have moved to Alta. This net migration occurs alongside the presence of three ethnic groups in the area: Saami, Kven, and Norwegian, which together convert the town a rather heterogeneous place. Site Alta Museum was built in 1991. It is situated just besides the largest ‘‘rockcarving’’ ﬁeld of north Europe. The rock carvings, dating back to 2000–6000 years, constitute one of Norway’s heritage sites included in UNESCO’s list of the world’s heritage. In addition to the responsibility for the rock carvings, the museum also has permanent and temporary exhibits portraying local cultural history (Olsen, 2000). The museum per se was awarded ‘‘The European Museum of the Year’’ prize in 1993. In 2004, the museum had 68,320 visitors. Of these, approximately two-thirds were tourists, thereby establishing the museum as the second most visited attraction in Finnmark. In other words, the museum has been a success as a summer-based tourist attraction. One of the main reasons for this huge success is in fact connected to its location in relation to the primary attractions in the area. The majority of the tourists in the area have to pass by close to the museum when on their way to the main attraction of this region – North Cape. Consequently, research by Mehmetoglu and Abelsen (2005) on international tourists visiting Alta museum shows that those features that make the tourists regard the museum as a good attraction are not those directly linked to the core product. Its situation as a tourist attraction means that the museum has had to put large efforts into being capable of handling such large amounts of visitors during the rather short summer season. At the same time, the museum has to manage its role as a local museum with a local audience as its main target. What follows describes this local audience in terms of their characteristics in relation to museum visitation. Sampling Using a questionnaire, the necessary data were collected from a representative sample of Alta residents. A telephone survey was conducted during the

24

MEHMET MEHMETOGLU AND KJELL OLSEN

period of 23 February–06 March 2006. The randomly selected target sample comprised 600 residents above the age of 18. The survey was ﬁrst pre-tested with an initial 50 respondents in order to see if there were any improvements needed in the research instrument. However, as no major amendments were required, the data collection continued. Out of these 600 potential respondents, 31 were not available, 44 did not meet the criterion for inclusion (e.g. were under the necessary 18 years), and 271 refused to participate. The remaining 254 agreed to participate in the survey. Based on these ﬁgures, the response rate was 42% (response/target sample). However, this percentage increased to 48% when we just compared the number of participants to the number of refusals. The Instrument The questionnaire started off with a speciﬁc question asking the respondents to indicate how often they had been to the museum in the past ﬁve years. After this opening question, the questionnaire consisted of three parts. The ﬁrst comprised items asking about how important two different sets of attributes were in the respondents’ minds for choosing to visit or not to visit the museum, on a 5-point scale, ranging from 1 (not at all important) to 5 (very important). In the same manner (on a 5-point scale), the respondents were also asked to reveal how often they were involved in a set of certain leisure activities (e.g. visiting concerts, library etc.). The second part of the questionnaire included questions generating information about the respondents’ behaviour on holiday in general (e.g. how often they visited museums). The ﬁnal part contained questions relating to the sociodemographic background of the sample. Measurement Dependent (Grouping) Variable Visit frequency to the museum was measured by utilising an ordered categorical question (1 ¼ none, 2 ¼ once, 3 ¼ 2–3 times, 4 ¼ 4–5 times, and 5 ¼ 6 or more times) that asked how often the respondents had been to the museum in the past ﬁve years. As a result of the theoretical reasoning derived from the literature, contextual information about the museum as well as initial non-signiﬁcant differences between frequency groups 3 and 4, a three-group solution was deemed appropriate for use in the main

From Cultural Consumer at Home to Heritage Tourist Away

25

(discriminant) analysis of the study. Further, we were only interested in those who indicated that they had visited the museum, and therefore category 1 was excluded from the analysis. This procedure provided us with the following three categories. Infrequent visitor: had been to the museum once in the past ﬁve years. Medium frequency visitor: had been to the museum 2–5 times in the past ﬁve years. Frequent visitor: had been to the museum 6 or more times in the past ﬁve years. Predictor Variables The study included several predictor variables (see also Table 4). One of these comprised the reasons for visitation. It contained four factors (summated scores) measured on a 5-point scale (not at all important ¼ 1 to very important ¼ 5): interest, relaxation, family togetherness, and socialisation (see also Table 1). Another variable represented the leisure activities of the respondents, including two factors (summated scores) again on a 5-point scale (not at all ¼ 1 to very often ¼ 5). The educational level of the respondents was measured via a dummy variable (no university education ¼ 0, university education ¼ 1). Annual household income was also included in the analysis and was measured through an ordered categorical question (see Table 4), ranging from 1 (under 100,000 Norwegian Krone (NOK)) to 8 (above 800,000 NOK). Finally, the satisfaction level with the entrance fee to the museum was measured on a 5-point scale (extremely unsatisﬁed ¼ 1 to 5 ¼ extremely satisﬁed).

Data Analysis The data analysis consisted of several procedures. The ﬁrst involved conducting two separate principal component factor analyses with varimax rotation on 10 reasons for visitation (Table 1) and six leisure activities (Table 2). Next, a multiple discriminant analysis was performed in order to determine whether the predictor variables (see above) could predict visit frequency (visitor groups). Finally, a bivariate correlation was carried out to examine the relationship between the inﬂuential predictor variables (or the discriminant function) and visit frequency of the same sample to museums when they were on holiday.

26

Table 1. Visit Reasons

Eigenvalue Variance (%) Cumulative variance (%) Cronbach’s alpha Mean inter-item correlation Number of items (total ¼ 10)

Factor 1

Factor 2

Factor 3

Factor 4

Interest

Relaxation

Family togetherness

Socialisation

0.815 0.732 0.708 0.682 0.684 0.841 0.670 0.494 0.874 0.529 2.130 21.29 21.29 0.730 0.481 3

1.819 18.18 39.48 0.423 0.269 2

Note: KMO: 0.786. Bartlett test: w2 ¼ 437.01; p ¼ 0.000; N ¼ 187.

1.535 15.34 54.83 0.585 0.321 3

1.221 12.20 67.04 0.496 0.330 2

Communality

0.708 0.613 0.667 0.577 0.591 0.755 0.695 0.578 0.806 0.715

MEHMET MEHMETOGLU AND KJELL OLSEN

Interest in local history Interest in rock carvings New exhibitions at the museum Visiting concerts/happenings Visiting cafe´ Spending time with family Weekend trips with children Closeness to the museum Taking guests to the museums Being with friends

Visit Reason’s Principal Component Factor Loadings.

From Cultural Consumer at Home to Heritage Tourist Away

Table 2.

27

Leisure Activities’ Principal Component Factor Loadings.

Leisure Activities

Going to movie Going to rock/pop/blues concerts Going to revue Visiting library Going to classical music concerts Going to theatre Eigenvalue Variance (%) Cumulative variance (%) Cronbach’s a Mean inter-item correlation Number of items (total ¼ 6)

Factor 1

Factor 2

Usual activities

Rare activities

0.510 0.694 0.861 0.681 0.739 0.584 1.770 29.49 29.49 0.595 0.330 3

Communality

0.544 0.552 0.772 0.485 0.556 0.596

1.735 28.92 58.41 0.532 0.284 3

Note: KMO: 0.708. Bartlett test: w2 ¼ 184.37; p ¼ 0.000; N ¼ 188.

RESULTS AND ANALYSIS Factor Analysis of Visit Reasons Factor analysis of the 10 original visit reasons resulted in four factors, with eigenvalues exceeding 1 and a total variance of 67%. These visit reason elements, and their corresponding factor loadings, are illustrated in Table 1. Respondents’ visit reasons were grouped under four main categories as a result of the factor analysis. Factor 1, labelled ‘‘interest’’, contained three visit reasons: interest in local history, interest in rock carvings, and new exhibitions at the museum. Factor 2, ‘‘relaxation’’, included two attributes: visiting concerts/happenings and visiting cafe´. Factor 3, ‘‘family togetherness’’, had three components too: spending time with family, weekend trips with children, closeness to the museum. Factor 4, ‘‘socialisation’’, was made up of the following two attributes: taking guests to the museum and being with friends.

Factor Analysis of Leisure Activities Factor analysis was also conducted with respect to the 6 original leisure activity items, with eigenvalues exceeding 1 and a total variance of about 58%. As indicated in Table 2, respondents’ leisure activities were grouped

28

MEHMET MEHMETOGLU AND KJELL OLSEN

under two categories as a result of the factor analysis. Factor 1, labelled ‘‘usual leisure activities’’, represented three leisure activities: going to movies, going to rock/pop/blues concerts, and going to revues. Factor 2, ‘‘rare leisure activities’’, also contained three attributes: visiting a library, going to classical music concerts, and going to the theatre. In the above analysis, summated scales for the original variables representing each factor were computed for use in the multiple discriminant analysis. Reliability analysis (Cronbach’s alpha) with respect to both of the above factor analyses indicated that only one (0.73) of the alpha coefﬁcients was acceptable (see Hair, Black, Babin, Anderson, & Tatham, 2006). However, the alpha coefﬁcients of the remaining factors were relatively low ranging between 0.42 and 0.59. The reason for this was the fact that these factors comprised few variables since Cronbach’s alpha decreases as the number of variables declines. In cases where scales contain few items, Briggs and Cheek (1986) suggest that it is more appropriate to report the mean inter-item correlation for the items. They accordingly recommend an optimal range for the inter-item correlation of 0.2–0.4. As shown in Tables 1 and 2, the mean inter-item correlation for the items constituting the factors met this criterion. Descriptive Analysis The means, standard deviations, frequencies, and percentages relating to the study’s variables are provided in Table 3. As can be seen from this table, of the four visit reasons, ‘‘interest’’ had the highest mean, followed by ‘‘socialisation’’ and ‘‘family togetherness’’, while the visit reason ‘‘relaxation’’ was deemed the least important. As far as the leisure activities were concerned, both rare and usual leisure activities had similar means. The table also indicated that while 57% of the respondents had a university education, the rest had lower educational levels. Further, nearly half (51%) of the respondents had an annual household income above 500,000 NOK, whereas the other half earned less. As regards the dependent variable, about half (52%) of the respondents were medium visitors (with 2–5 visits) while there were nearly equal numbers of infrequent (one visit) and frequent (6 or more visits) visitors among the sample. Discriminant Analysis In line with the ﬁrst objective of the current study, a multiple discriminant analysis was performed to determine whether the nine predictors (see Table 4) could predict visit frequency (visitor groups). Two discriminant

From Cultural Consumer at Home to Heritage Tourist Away

Table 3. Variable Visitor groups Infrequent visitors Medium visitors Frequent visitors Education Non-university University Annual household income Under 100.000 NOK 100–199.000 200–299.000 300–399.000 400–499.000 500–599.000 600–800.000 Over 800.000

29

Descriptive Analysis. Frequency

%

40 97 51

21 52 27

80 108

43 57

7 10 18 26 22 40 38 9

4 6 11 15 13 24 22 5

Mean

SD

5.14

1.836

Satisfaction with entrance fee

3.32

1.122

Visit reasons Interest Relaxation Family togetherness Socialisation

3.43 2.54 2.65 2.96

0.980 1.172 1.229 1.191

Leisure activities Rare leisure activities Usual leisure activities

2.20 2.23

0.874 0.938

functions, the ﬁrst of which was statistically signiﬁcant, emerged from the analysis. The signiﬁcant discriminant function had an eigenvalue of 0.53 explaining 90% of the variance, with a canonical correlation of 0.59 exceeding the criterion of 0.5 for a strong relationship (Meyers, Gamst, & Guarino, 2006). Structure correlations (discriminant loadings) indicated that the visit reasons (interest and relaxation), satisfaction with entrance fee, educational level, and annual household income were primarily associated with the signiﬁcant discriminant function 1. Additionally, two other variables, namely, the visit reason ‘‘socialisation’’ and the leisure activity ‘‘rare leisure activity’’ also loaded highly on the ﬁrst function. While the visit reason ‘‘interest’’ had the strongest relationship, and annual household income had the weakest

30

Table 4. Results of Discriminant Analysis of Visitor Groups. Discriminant Function

Group centroids Infrequent visitor Medium visitor Frequent visitors

0.531 0.060

Percentage of Variance

Canonical Correlation

Wilks’ Lambda

w2

Df

Sig.

0.59 0.24

0.617 0.944

71.57 8.58

18 8

0.000 0.379

89.9 10.1

Function 1 0.784a 0.449a 0.418a 0.334a 0.178a 0.177 0.453 0.138 0.377

Function 2 0.121 0.241 0.322 0.113 0.030 0.587a 0.500a 0.443a 0.442a

0.837 0.177 1.136

0.319 0.236 0.152

N ¼ 155. a Largest absolute correlation between each variable and the discriminant function.

MEHMET MEHMETOGLU AND KJELL OLSEN

1 2 Discriminant loadings Predictor variables Interest Satisfaction with entrance fee Relaxation Education Annual household income Family togetherness Rare leisure activities Usual leisure activities Socialisation

Eigenvalue

From Cultural Consumer at Home to Heritage Tourist Away

31

relationship with the discriminant function, the remaining predictors showed an acceptable level of association. On the basis of these results, the ﬁrst discriminant function was labelled ‘‘cultural consumption’’ reﬂecting both the cultural and economic contents of the predictors. An examination of the group centroids revealed that the signiﬁcant function discriminated between the ﬁrst two categories (infrequent and medium) and the third group (frequent visitors), with the latter having the highest mean on the ‘‘cultural consumption dimension’’. That is to say, those motivated, to a greater extent, by ‘‘interest’’, ‘‘relaxation’’, ‘‘socialisation’’, ‘‘adequate entrance fee’’ to visit the museum as well as being more involved in ‘‘rare leisure activities’’, and highly educated with a higher income level, were likely to visit the museum often, and vice versa. The examination of the centroids showed further that the primary source of differentiation, based on the ‘‘cultural consumption’’ dimension was, however, between the infrequent visitors and frequent visitors. This relationship is more explicitly illustrated in Fig. 1, showing each visitor group’s mean score on function 1. This ﬁgure also revealed that the three visitor groups had nearly similar mean scores on the second discriminant function due to the non-signiﬁcant Wilks’ lambda (p>0.05) (see also Table 4).

visitor groups

4

infrequent visitor medium visitor frequent visitor Group Centroid

3

Function 2

2 1 infrequent visitor

frequent visitor

0 medium visitor -1 -2 -3 -4

-2

0

2

4

Function 1

Fig. 1.

Separation of Visitor Groups on Discriminant Functions.

32

MEHMET MEHMETOGLU AND KJELL OLSEN

A validation procedure was also conducted to examine the predictive accuracy of the model. The proportional by chance accuracy rate was computed as 0.37 (0.252+0.492+0.262). The criterion for a useful model is considered 25% greater than the by chance accuracy rate, namely 46% (0.37 1.25). The cross-validated accuracy rate was 53%, which was clearly above the proportional by chance accuracy criterion of 46%, consequently conﬁrming the predictive validity of the analysis.

Bivariate Correlation Analysis In accordance with the second objective of the current study, a bivariate correlation was conducted to examine the relationship between the signiﬁcant discriminant function (cultural consumption) and frequency of visit to museums on holiday. The latter was measured by asking the respondents to indicate how often (not at all ¼ 1 to 5 ¼ quite often) they visited museums when they were on holiday abroad/home. The results of the analysis showed that frequency of visit to museums on holiday was positively related to the discriminant function (cultural consumption), with a coefﬁcient of r ¼ 0.371, which was also signiﬁcant at po0.001. This ﬁnding suggests that the ‘‘frequent visitor’’ group with a high mean on cultural consumption dimension (i.e. motivated by ‘‘interest’’, ‘‘relaxation’’, ‘‘socialisation’’, ‘‘adequate entrance fee’’ to visit museum at home as well as being involved in ‘‘rare leisure activities’’, highly educated with a high income level) was more likely to visit museums often on holiday too.

CONCLUSIONS AND IMPLICATIONS Theoretical Implications This analysis has demonstrated that Alta Museum, the object of study, has a core of frequent visitors that have a motivation based on ‘‘interest’’, ‘‘relaxation’’, ‘‘socialisation’’, and ‘‘adequate entrance fee’’, what are here labelled ‘‘rare leisure activities’’ in a local context and characterised by such socio-economic parameters as high education and higher income. This ﬁnding is very much in line with the general literature that links museum visiting to certain socio-cultural categories of the population in Western European countries as well as in Norway (see, e.g., Bourdieu & Darbel, 1991; Kulturdepartementet, 1996). This study adds to former investigations by

From Cultural Consumer at Home to Heritage Tourist Away

33

indicating that such a speciﬁc audience does not just belong to larger museums in cities. Museums located in small towns in peripheral areas also seem to ﬁt this general pattern. Hence the local particularities, Alta being an educational centre, renders that this ﬁnding not uncritically can be reassigned to other small town museums. Hence, this study might convey different general traits among museum visitors situated in this particular socio-cultural category. Firstly, their affection for museum visits does not change from their everyday life to when they go on holiday. Museum visits constitute a leisure activity conducted irrespective of travel distance. Secondly, and more suggestively, there is no reason per se to believe that the way these museum visitors consume their home town museum differs dramatically from the way they consume museums on holiday. The ﬁrst general trait challenges the common presupposition found in many formal deﬁnitions of tourism that tends; ‘‘y to reduce tourism to acts of leisure and recreation at the end of acts of travel’’ (Franklin, 2003, pp. 27–28). For the core audience at Alta Museum the museum visit is an act that is conducted irrespective of their ascribed status as locals or tourists. Rather than focusing on the physical movement that usually is an integral part of most deﬁnitions of tourists, the understanding of museum visitors can be enhanced by their performance on site. Doubtless, travel matters in relation to some features of a museum visit, but according to the material presented here, this does not relate to the motivation for visiting museums and the visitors’ socio-economic background. Rather than separating the audience into categories – in some respects insigniﬁcant in others not – of tourists and locals, research should rather clarify when and how such a distinction is useful and when it is not. Wang (2000, p. 195ff.) has argued that contemporary Western societies have witnessed a process of touristification, where certain sites for consumption have been developed. In addition to the home and the city, particular touristic sites have become social spaces of consumption. Wang (2000, p. 195) refers to holiday resorts and other destinations (among which are major global and historical cities), but his argument could be extended to other sites visited irrespective of travel. As Wang (2000) claims, in relation to the difference between ordinary and touristic consumption: ‘‘Whereas the consumption of material goods takes place during leisure time, the consumption of experiences (or experiential commodities) is in fact the consumption of a certain period of time itself, namely the consumption of ‘a good time’’’ (p. 194, italics in original). Museums can provide this ‘‘good time’’, and such consumption can take part regardless of whether the

34

MEHMET MEHMETOGLU AND KJELL OLSEN

consumer is categorised by others as a local or a tourist. As conﬁrmed in the current study, those classiﬁed as frequent visitors to Alta Museum are involved in this mode of cultural consumption both in what tourism research claims is their leisure at home and as tourists away. For tourism research it may sometimes be necessary to make this distinction, but for the visitors when at sight, and in many respects for the museums, this division is not necessarily important. As van Aalst and Boogaarts (2002) claim, ‘‘y going to a museum is increasingly presented as taking part in a ‘spectacle’’’ (p. 198). This implies that the museum world is increasingly becoming recognised as part of an industry that aims to provide the consumption of ‘‘a good time’’. As Hannigan (1998) puts it, this consumption is an ‘‘edu-tainment’’ that emerges by, ‘‘y the joining of educational and cultural activities with the commerce and technology of the entertainment world’’ (p. 98). Therefore, museums have developed into sites where different functions intertwine (van Aalst & Boogaarts, 2002, p. 196). Today the museum, both in cities and in many rural areas, is a multipurpose space with restaurants, shops, concerts, and other events. Developers have for a long time been aware of the museums’ potential for developing city centres into consumption sites and for simultaneously creating a speciﬁc proﬁle or image of a destination. What this study makes clear is that such development predominantly caters for a certain audience that consumes museums at home and away. Highly educated, afﬂuent visitors are welcomed both by museums that are increasingly obliged to generate their own revenues and by the tourist industry aiming for adequate ﬁnancial returns. Under this perspective, knowledge about the core museum audience becomes interesting for both consumers at home and on tour. Hence, the present study also shows that other social groups have less interest in this mode of cultural consumption. This constitutes a problem not only for small rural museums like Alta Museum but also for larger institutions, because the development found in many museums seems to perpetuate the social divisions found in traditional museums (Bourdieu & Darbel, 1991; Poulot, 1994).

Practical Implications The ﬁndings of this investigation also provide some important suggestions for the management and marketing of cultural tourism attractions and destinations in general, as well as heritage museum attractions in particular. One of the most salient issues for heritage tourism attraction managers to

From Cultural Consumer at Home to Heritage Tourist Away

35

take into consideration is the realisation that local visitors may not necessarily differ from their international counterparts in terms of visitation patterns. Indeed, those visiting the museum frequently back home and holiday in general may be the same type of people with high education and relatively high income, as well as clearly possessing more cultural capital. This ﬁnding suggests then that heritage tourism attraction managers, by using the knowledge about their local visitors, can efﬁciently develop their marketing mix. In other words, managers and marketers do not necessarily think of local and international visitors as two different and separate markets when it comes to what makes them visit a cultural attraction. For instance, in terms of product development, heritage attractions should certainly strengthen the content of their products around the ‘‘interest’’ component, since this was the main reason for frequently visiting Alta Museum. That is to say, a heritage museum product should convey to its visitors rich information about local history, culture, and theme of the museum through a variety of exhibitions. The same component (i.e. interest) should also be incorporated into the promotional activities of any heritage tourism attraction. For example, the fact that frequent museum visitors were also those involved in rare leisure activities such as visiting libraries, and going to the theatre and classical concerts, should mean that marketers can usefully promote their heritage attractions in such cultural contexts. Although the above-mentioned activities would certainly contribute in attracting both existing and potential heritage attraction visitors, this target group still comprises only a third of the heritage visitor market (i.e. frequent visitors). This implies that heritage tourism attractions, particularly on account of recent intense competition, cannot simply rely on those who are interested in history and culture. Thus, any heritage tourism attraction should also try to develop new strategies to attract those visiting museums to a lesser extent (i.e. infrequent and medium visitors). This means that, instead of trying to diversify the museum product according to the international visitor versus resident criterion, managers should equally consider product diversiﬁcation according to the dimension of those least and most interested in heritage. Since satisfaction with the entrance fee at the current museum was one of the reasons for frequent visitation, a strategy to attract a greater number of visitors from the infrequent and medium categories might be to reduce the level of entrance fee (if feasible), or to communicate clearly to these groups the value for money they get for the fee they do pay. In fact, instead of having an unjustiﬁably high entrance fee, it would be a better idea for an

36

MEHMET MEHMETOGLU AND KJELL OLSEN

attraction to keep the admission charge to a minimum and instead develop some new product components (preferably requiring visitor participation) at the site, offerings that may stimulate additional spending. This suggestion is also in line with the ﬁndings of McKercher and du Cros (2002), who claim that those who are not purely interested in cultural tourism have a low level of willingness to pay and prefer easily consumed experiences. A ﬁnal implication is for cultural heritage managers. Since one of their tasks is to systematically maintain the cultural and historical values of heritage assets for the enjoyment of present and future generations (McKercher & du Cros, 2002), as in the case of the current study’s site, cultural heritage managers should ensure that their cultural asset is offered to ‘‘right’’ segment of tourists that is the most compatible with local users, in order that their experience of the cultural attraction takes place under terms set for locals. One of the main limitations of this study is that it is based on a sample drawn from the population of a particular city and, more importantly, in relation to a particular heritage museum. Thus, the ﬁndings cannot necessarily be directly transferred to other populations or contexts. Another limitation is that, based on the signiﬁcant correlation between local visitors’ museum visitation patterns at home and on holiday, we may have implicitly created a segment of international visitors. This concern may, however, not be so in reality, to the extent that a similar study with respect to international visitors might yield different results. Were such a comparative investigation to be conducted, locals and international visitors could also be contrasted along other dimensions not treated in the current study. Further, as very few scholars have done in tourism research (Haukeland, 1990), inquiries into why people do not visit museums may also provide some additional information that can be of value to both academics and tourism industry.

REFERENCES van Aalst, I., & Boogaarts, I. (2002). From museum to mass entertainment. The evolution of the role of museums in cities. European Urban and Regional Studies, 9(3), 195–209. Bourdieu, P. (1986). Distinction. A social critique of the judgement of taste. London: Routledge. Bourdieu, P., & Darbel, A. (1991). The love of art. Cambridge: Polity Press. Briggs, S. R., & Cheek, J. M. (1986). The role of factor analysis in the development and evaluation of personality scales. Journal of Personality, 54, 106–148. Franklin, A. S. (2003). Tourism: An introduction. London: Sage. Fyfe, G., & Ross, M. (1996). Decoding the visitor’s gaze: Rethinking museum visiting. In: S. Macdonald & G. Fyfe (Eds), Theorizing museums (pp. 127–152). Oxford: Blackwell.

From Cultural Consumer at Home to Heritage Tourist Away

37

Hair, J. F., Black, W. C., Babin, B. J., Anderson, R. E., & Tatham, R. L. (2006). Multivariate data analysis (6th ed.). New Jersey: Prentice-Hall. Hannigan, J. (1998). Fantasy city: Pleasure and profit in the postmodern metropolis. London: Routledge. Haukeland, J. V. (1990). Non-travelers: The ﬂip side of motivation. Annals of Tourism Research, 17(2), 172–184. Hooper-Greenhill, E. (1994). Museums and their visitors. London: Routledge. Kulturdepartementet. (1996). Museum. Mangfald, minne, møtestad (p. 7). Oslo: NOU. Kulturdepartementet. (2005). Kultur og næring. St. meld. nr. 22 (2004–2005). Leiper, N. (1990). Tourist attraction systems. Annals of Tourism Research, 17, 367–384. McKercher, B., & du Cros, H. (2002). Cultural tourism: The partnership between tourism and cultural heritage management. New York: The Haworth Hospitality Press. Mehmetoglu, M., & Abelsen, B. (2005). Examining the visitor attraction product: A case study. Tourism Analysis, 9(4), 269–284. Meyers, L. S., Gamst, G., & Guarino, A. J. (2006). Applied multivariate research – design and interpretation. London: Sage. Middleton, V. (1990). New visions for independent museums in the UK. West Sussex: Association of Independent Museums. Olsen, K. (2000). Ethnicity and representation in a ‘local’ museum. In: P. Anttonen, B. Klein, A.-L. Siikkala & S. R. Mathisen (Eds), Folklore, heritage politics and ethnic diversity (pp. 140–157). Botkyrka: Multicultural Centre. Poulot, D. (1994). Identity as self-discovery: The ecomusuem in France. In: D. J. Sherman & I. Rogoff (Eds), Museum culture, histories, discourses, spectacles (pp. 66–84). London: Routledge. Prince, D., & Higgins, B. (1992). The public view: The findings of the 1991/92 study of the perception and use of Leicestershire museums, arts and records service. Leicestershire: Prince Research Consultants Limited for Leicestershire Museums. Ritzer, G., & Liska, A. (1997). ‘McDisneyization’ and ‘post-tourism’: Complementary perspectives on contemporary tourism. In: C. Rojek, & J. Urry (Eds), Touring cultures (pp. 96–109). London: Routledge. Uriely, N. (2005). The tourist experience: Conceptual developments. Annals of Tourism Research, 32(1), 199–216. Viken, A. (2000). Turismens essensialiserende effekt – samisk kultur i lys av en tiltakende turisme. In: S. R. Mathisen (Ed.), Kulturens materialisering: Identitet og uttrykk (pp. 25–52). Kristiandsand: Høyskoleforlaget. Wang, N. (2000). Tourism and modernity. Amsterdam: Pergamon.

POTENTIAL IMPACTS OF GENERATIONAL CHANGE ON DESTINATIONS Bruce Prideaux ABSTRACT Over the next decade the older travel market will experience a generational shift as the pre-war generation is replaced by the baby boomer generation. For destinations such as Norfolk Island that have built a substantial market segment based on older tourists this generation shift will have significant implications. While changes will be required in the type of products and experiences offered by the Island’s tourism industry the increased size of the baby boomer generation offers considerable scope to increase yield. This paper examines these issues and discusses the need to recognise the importance of the baby boomer tourist as a distinct and separate tourism segment. To illustrate the possible impact of generation change the paper proposes a product gap model.

INTRODUCTION This paper examines the implications of generational change that may occur as the pre-war generation of tourists is replaced by the baby boomer generation using Norfolk Island as a case study. The paper commences with a Advances in Hospitality and Leisure, Volume 3, 39–54 Copyright r 2007 by Elsevier Ltd. All rights of reproduction in any form reserved ISSN: 1745-3542/doi:10.1016/S1745-3542(06)03003-7

39

40

BRUCE PRIDEAUX

review of issues relevant to the future development of the tourism industry on Norfolk Island followed by a discussion of the characteristics of the prewar and baby boomer generations. Following an examination of the potential impacts of generational change, the paper introduces a model that can be used to identify points at which changes in the composition of generations may effect destinations. Because the case study is based on a relatively small discrete destination the issue of generation change is more apparent than may be the case in larger destinations that have the resources to cater for multi-generation demand patterns. In this paper market segments are based on the tourist’s membership of a speciﬁc generation in preference to classiﬁcation based either on membership to a speciﬁc tourist segment as implied by the term senior or retiree or a classiﬁcation that is based on life cycle segmentation as suggested by Zimmermann (1982), Mieczkowski (1990) and Collins and Tisdell (2002). Segmentation using the life cycle approach is based on classifying an individual’s membership of a speciﬁc family structure ranging from child thought to solitary survivor retired (or similar terminology) but does not recognise classiﬁcations based on generation membership. Thus in the life cycle context a senior is an older person though not always retired. While the terms seniors and retiree’s are often used to identify speciﬁc market sectors of older tourists there is no clear deﬁnition of the age compositions of either retirees or seniors. According to the deﬁnition of seniors used by Australian National Seniors Association (Wei, Prideaux, & Ruys, 2000) baby boomers who are currently working and aged 50 years or older are classed as seniors yet for ofﬁcial purposes the age at which an individual becomes a senior may be much higher. In the case of Australia, the Federal government’s deﬁnition for seniors is not precise with males aged 65 years being eligible for means tested government aged pensions but at the same time people aged 55 years and over are allowed to retire and access their superannuation funds. Moreover, the term retiree can used to describe any person who has ceased full time employment and is neither age nor generation speciﬁc. Segmentation by generation membership offers a third way to classify older tourists. A number of authors (Cohen, 2004; Hugo, 2003) have argued that each generation has speciﬁc characteristics that distinguish it from other generations. If this is the situation it is apparent that the issue of generation membership is important and worthy of discussion at industry, government and academic levels. Membership of a speciﬁc generation is determined by age thus persons belonging to the baby boomer generation are deﬁned as persons born between 1946 and 1965 (Muller & Cleaver, 2000).

Potential Impacts of Generational Change on Destinations

41

A classiﬁcation based on generation membership does not recognise membership of a speciﬁc family structure as implied in the life cycle model but may be used in conjunction with deﬁnitions of older tourists. Thus persons aged 60 in 2006 may be described as a baby boomer senior but a person aged 61 would be described as a pre-war senior. Pre-war seniors are deﬁned as those persons born prior to the end of the Second World War. The use of classiﬁcations such as seniors and retirees or life cycle for tourist segmentation fails to consider the impact of a range of factors that may be captured by using a classiﬁcation based on generation membership. For example, baby boomers grew up in an era that was entirely different in its social, cultural and economic characteristics to the early life experiences of the pre-war generation. Over a number of years Norfolk Island has speciﬁcally targeted older tourists and has developed its products and experiences to reﬂect this market. However, there has been a failure by members of the Island’s tourism industry to identify the changing nature of the seniors market. Previously, seniors visiting the Island were members of the pre-war generation but in recent years the ﬁrst of the baby boomer generation have reached the age were they may loosely be described as seniors. The continued use of the term senior to apply to all older tourists has effectively masked the changes that have occurred in the composition of this market.

THE NORFOLK ISLAND TOURISM INDUSTRY Norfolk Island is a small Australian dependency located just over two hours ﬂying time by jet from major Australian generating regions centred on Brisbane and Sydney. The Island shares many of the problems faced by small Islands generally but also has a number of advantages not enjoyed by other small island destinations, particularly in the Paciﬁc. The Island faces issues of overdependency on tourism, is a market follower rather than a market leader, has carrying capacity limitations, is located in a peripheral location, lacks viable alternatives to tourism and possesses visitor infrastructure that is falling behind the standards found in competing destinations in Australia. The principle advantages enjoyed by the destination are its strong positive image as a heritage destination, a strong record of growth in the last decade, its competitively priced product, demonstrated high level of tourist satisfaction (Prideaux, Croswell, & Ng, 2004), absence of residual post-colonial problems that are found in many other Paciﬁc Islands and common cultural and social values shared with Australia and New Zealand, the Island’s main source markets.

42

BRUCE PRIDEAUX

For a number of years the Norfolk Island’s tourism industry has focused on older tourists, who until recently belonged to the pre-war generation. As a destination, Norfolk Island has the potential to offer a range of experiences that have cross-generation appeal however as it is currently structured the apparent bias towards visitors aged 50 years and above and who account for nearly 70% of all visitors (Prideaux, Croswell, & Ng, 2004), is reinforced by a range of factors including the variety of shopping, the style of commentary used by tour guides and advertising. A recent report on the Island’s tourism industry (Prideaux et al., 2004) noted that the failure to alter the Island’s current range of tourism products and services to reﬂect the aspirations and consumption patterns of baby boomers may result in a slow decline in tourist numbers in the next decade. Further, Prideaux et al. observed that there was a danger that a decline of this nature will reduce the capacity of the Island’s government and private sector to undertake ongoing refurbishment of public and private sectors facilities and ﬁnance new investment. The Island relies on tourism to generate up to 50% of gross government revenue with a further 20% contributed by tourism industry employees (Acumen Alliance, 2005). Residents do not pay income tax and instead rely on tourism receipts to fund a signiﬁcant percentage of government spending. Between 2000 and 2005 tourism arrivals declined by 15% to 34,000 visitors. According to a recent report (Acumen Alliance, 2005) the decline is so serious that the Island’s Government will have insufﬁcient operating surpluses by mid-2007 to cover the operating deﬁcit of the Revenue Fund which funds a range of Island services. At this point there will be no funds available for long-term maintenance of Island infrastructure such as roads and the airport. It is clear that the Island is facing a major ﬁnancial disaster and must implement new policies to return it to long-term economic prosperity. Because of its close historical, cultural and social ties with Australia and the relatively short ﬂying times from cities such as Sydney and Brisbane, Norfolk Island has many of the characteristics of an Australian domestic destination, at least from the tourist’s perspective. However, the requirement to hold a valid passport to visit the Island precludes it from being classed as an Australian destination. Norfolk Island has a strong positive image in respect to heritage, the range of activities that are available and its environment. When compared to competing destinations in Australia including Tasmania, Byron Bay, Gold Coast, Noosa, Coffs Harbour, Port Douglas, Whitsunday’s and Cairns, the Island does not rate well in areas such as the variety of shopping, the ‘look’ of its main shopping precinct in Burnt Pine, the lack of modern resort style accommodation and the absence

Potential Impacts of Generational Change on Destinations

43

of both brand and non brand name hotels in the international 3 to 5 star range.

THE SIGNIFICANCE OF GENERATIONS Generational difference is a signiﬁcant issue for the tourism industry and while there is a growing body of literature by researchers such as Muller and Cleaver (2000), Wei and Ruys (1998), Schewe (1990), Javalgi, Thomas, and Rao (1992), and Tomljenovic and Faulkner (2000) many sectors of the industry have yet to incorporate these generation changes into their strategic planning and thinking about product development. In a recent contribution to a book on backpackers, Cohen (2004) observed that the baby boomer generation began the backpacker phenomenon that had close parallels with the major social and political upheavals of the 1960s. Weather these early baby boomers were: the ﬁrst postmodern tourists seeking hedonistic experiences in parallel with the social upheavals associated with the youth culture of antiestablishment protest in the 1960s; modern tourists pursuing objective authenticity in ancient cultures and settings; or travellers who in the same time and physical space sort both hedonism and authenticity, is a matter for debate that Cohen did not pursue. However, attempts to classify tourists in this manner does have a great deal of relevance for destinations such as Norfolk Island which has a strong emphasis on heritage. Are prewar generation visitors seeking the objective authenticity described by MacCannell (1973), or are they seeking other yet to be deﬁned experiences? The proﬁle of tourists visiting Norfolk Island described by Prideaux et al. suggests that authenticity is a key attribute sort by the pre-war generation. Similarly, are baby boomers tourists seeking modern or postmodernist experiences when they visit Norfolk Island? The answers to these questions should help to deﬁne the type of tourism products and experiences that members of each generation may wish to experience. The life experience of baby boomers is very different from the pre-war generation who in the years following the First World War enjoyed the economic boom of the ‘roaring twenties’, suffered the privations of the Great Depression and became embroiled in the Second World War. The uncertainty of the formative years of the pre-war generation was replaced by the certainty of economic prosperity and sense of optimism founded on technological advancement experienced by the baby boomers. It is differences of this nature that must be factored into the experiences and expectations that are offered by destinations attempting to attract

44

BRUCE PRIDEAUX

tourists from a speciﬁc generation. What is apparent is that all generations share interests in speciﬁc tourist resources including heritage, nature, shopping and gastronomy. However, the manner in which the needs of the different generations are met often differs because the manner in which experiences are viewed or even consumed will differ according to a range of factors including life cycle stage, generation membership and socio-demographic characteristics. Thus the counterculture of the 1960s and the early 1970s, embodied in the hippie movement and rock icons such as Alice Cooper, the Beetles and the Who, will be almost as alien to generation Y as it was to the pre-war generation. Just as the pre-war generation of tourists identify with experiences that incorporate familiar cultural symbols such as the music of the 1930s and the 1940s, baby boomers can also be expected to identify with tourism products that incorporate elements of the culture of their generation. For this reason each generation group is likely to have expectations of holiday experiences that differ from other generational groups. Destinations therefore need to be aware of possible differences between tourists that may be explained as a result of generation membership as well as the consequences of other variables such as position in the life cycle, income, gender or profession. If there are signiﬁcant shifts in tourist demand that can be attributed to changes in the generation membership of tourists there is a clear need for destinations to develop a transitional strategy designed to attract existing generation-based markets while simultaneously developing new products and experiences for the new generation market. On Norfolk Island there is evidence that the current product mix has been heavily inﬂuenced by the needs of the pre-war generation, a result of the large representation of this group in the current market mix. Fig. 1 illustrates the actual and projected age distribution of Australia’s population over a 70-year (1961–2031) period showing the progression of the baby boomers thought the age groupings. The 2001 position of baby boomers illustrates the progress of this generation into their senior years while the pre-war generation shows evidence of a decline in numbers. By 2031 there will be very few remaining pre-war generation members, baby boomers numbers will be declining and generation X’s will have commenced retiring in signiﬁcant numbers. The signiﬁcance of Fig. 1 is the depiction of the reduction in the numbers of the pre-war generation over time. The rate of decline will accelerate during the decade 2001–2010. In Australia, as in many other Western nations, the increasing economic power of the baby boomer generation became apparent when the ﬁrst of the baby boomers became eligible to access superannuation retirement funds from 2001 onward. The impact of the baby boomers will be gradual at ﬁrst

Potential Impacts of Generational Change on Destinations

Fig. 1.

45

Age Distribution of Australian Population, 1961–2031. Source: ABS (1999).

46

BRUCE PRIDEAUX

and accelerate from 2011 onward as the initial wave of post-war children turn 65 years of age and become eligible for government funded aged pensions. Overall, the generational shift that is beginning to occur in the older tourist market will be substantial given the signiﬁcant differences between baby boomers and the pre-war generation in areas such as economic wellbeing, educational proﬁle, health and demand for tourism goods and services. Compared to the pre-war generation many, though not all, baby boomers have greater access to superannuation funds and have had greater opportunities to build personal wealth. The relatively restricted access to personal superannuation schemes for many pre-war generation members has resulted in high levels of reliance on rather meagre government funded pensions and in some cases personal investment saving for the bulk of their income. As a consequence many people in this generation group face severe limitations on the level of personal discretionary income available for travel. Compared to the pre-war generation many baby boomers who started families after establishing careers will continue to have dependent children as they near or even reach retirement thus restricting their levels of disposable income. Income characteristics of this nature need to be incorporated into destination marketing strategies. In a recent paper on Australia’s ageing population, Hugo (2003) made a number of informed speculations that further identify major characteristics of the baby boomer generation. According to Hugo, baby boomers when compared to earlier generations: Have a higher level of divorce and separation than earlier generations and at least 20% of Australians in their 50s do not currently live with a partner. They are more ethnically heterogeneous than earlier generations. They have higher levels of chronic illness and disability because of higher life expectancy but on the other hand may be healthier for a longer period of time. They have higher levels of education. They are more travelled. They are more selﬁsh. There is greater social polarisation. There is less gender inequality. They are more health conscious. Of particular importance is the growing numerical size of the baby boomer market. In total there are 5.6 million persons belonging to the baby

Potential Impacts of Generational Change on Destinations

47

boomer generation in Australia (Australian Bureau of Statistics, 2004). In 2001 there were 2.4 million Australian’s aged 65 years and over. By 2011 the number of 65 years and older will rise to 2.95 million reﬂecting the peak size of the pre-war generation. By 2021 persons aged 65 years and older will rise to 4.02 million as increasing numbers of baby boomers reach 65 years of age and by 2031 there will be few remaining members of the pre-war generation (see Fig. 1) able to travel. In percentage terms, the 65+ age group will be 6.2% larger than it was in 2001 and 70.1% larger in 2021 than it was in 2001 (Hugo, 2003).

METHODOLOGY Data used in this research is based on participant research, interviews with Island residents and data drawn from a previous survey of Norfolk Island tourists undertaken by Prideaux et al. Compared to many destination studies that focus on aspects of tourist behaviour this study adopted a supply side perspective designed to identify the major characteristics of the destination’s product. For this reason a quantitative study of tourist characteristics was not considered to be an appropriate research approach although aspects of demand based on recent research are considered. Research into tourist demand usually investigate speciﬁc aspects of demand but rarely consider issue of supply. The failure to undertake more intensive investigations into destination supply is a major shortcoming of the literature and perhaps is reﬂective of many researchers apparent preoccupation with quantitative research. From a paradigmic perspective there has been considerable emphasis on positivistic research methods which emphases quantitative approaches and data analysis with rather less emphasis on phenomenology which is based on the view that reality is socially constructed rather than objectively determined (Easterby, Thorpe, & Lowe, 1991, p. 24). According to the phenomenological approach, knowledge can be gained through independent and creative thinking as well as through the incremental steps that are characteristic of the positivistic approach. Research of the nature undertaken in this paper is more suited to research methods that fall in the phenomenological paradigm because of the nature of the problem being investigated. This research also adopts a case study approach because it allows the more general issue of visitor classiﬁcation into discrete categories, such as generational membership, life cycle membership and age-based segmentation to be studied in a particular setting with observations then able to be generalised beyond the speciﬁc geographic space occupied by the case. In

48

BRUCE PRIDEAUX

tourism research, the use of case studies to support research into resort research is gaining popularity although their employment has been largely to test models rather than build models. Case studies have been used extensively to test models such as Butler’s (1980) Tourism Area Cycle of Evolution (Douglas, 1997; Tooman, 1997; di Benedetto & Bojanic, 1993; Cooper & Jackson, 1989) and the Resort Development Spectrum (Prideaux, 2004). While the case study approach has been criticised on the grounds that it lacks rigour it is a useful method of identifying variables. In its simplest form, the case study approach investigates contemporary phenomenon within real-life contexts where the boundaries between the phenomenon and the context are not clearly evident (Yin, 1994). A major element of the research undertaken in this study involved classifying a range of shopping experiences and tourism activities into two categories: activities and shopping experiences that have signiﬁcant appeal to pre-war generation tourists and activities and shopping experiences that appealed to other generations. Participant research was adopted as the primary research methodology because of the need to identify and classify activities and experiences on the basis of their appeal to speciﬁc generational groups. A team of three researchers was used, two were generation Y research assistants and the other was a baby boomer tourism researcher. The generation Y researchers were thoroughly briefed on the aims of the research and the baby boomer was an experienced researcher. Underlying this research is the assumption that each generation is unique and has a preference for tourism products and services that are different to those of other generations. This assumption is framed against the growing body of research (Muller & Cleaver, 2000; Wei & Ruys, 1998; Schewe, 1990; Javalgi et al., 1992) that identiﬁes generation membership as a major, but not only, point of differentiation that reaches beyond age to encompass many aspects of an individual’s life. Participant –observational research, described by Neuman (2004, p. 267) as ‘‘a qualitative style in which a researcher directly observes and participates in small-scale social settings in the present time and in the researcher’s home culture’’ is an appropriate research approach in this study because of the need to observe differences in behaviour patterns. Participant observation by the researcher found that many tours emphasised the themes, styles and images familiar to the pre-war generation and which are embodied in the stories told during tours, the styles of music played in many venues and in the range of goods sold in shops. Several examples based on participant research highlight these observations. Two researchers, both members of generation Y which spans the time frame from

Potential Impacts of Generational Change on Destinations

49

approximately 1978 to 1998 (Edmondson, 1995; Hicks & Hicks, 1999; Tulgan, 2000), visited every shop on Norfolk Island. On their return they reported that there was an excellent range of articles to purchase, but most were in their opinion suited for purchase by their older relatives such as grandparents. They found little that they would consider purchasing for themselves. The baby boomer researcher also found that apart from electronics, cameras, liquor and perfumes most goods available were suited to an older demographic. In another example the baby boomer researcher and one of the generation Y researchers participated in several popular tours. Most of the commentary was pitched at the pre-war generation and the baby boomer researcher was forced to interpret for the generation Y researcher, somewhat inadequately, many of the terms, stories and objects used by the tour leader to describe life in the 1930s and the 1940s. Results of the research found that little emphasis has been placed on developing tourism experiences for members of the baby boomer generation or for members of generations X and Y. The researchers also considered the structure and operation of shopping on the Island and the investment policies implemented by the Norfolk Island Administration. The structure of the Burnt Pine Shopping precinct was photographed and the range of goods categorised and later compared with the structure and categories of goods available in Australian domestic locations including Kuranda and Port Douglas in North Queensland and Byron Bay in New South Wales.

IMPLICATIONS FOR NORFOLK ISLAND In a product sense the Island is witnessing the effects of the product cycle. In its basic form the product cycle refers to the stages that a product will move through from its introduction to either its ﬁnal decline or rejuvenation at the end of the life of the product. Fig. 2 illustrates the operation of the classic product curve in two separate product markets. Curve 1 represents the product cycle of tourism products servicing the pre-war generation while Curve 2 represents the tourism product curve of services that are consumed by the baby boomer market segment. In Curve 2 the ﬁrst Australian baby boomers began to retire in 2001 while the last will become eligible to retire on government pensions around 2031. Fig. 2 indicates that a product gap (not to scale) will emerge if the destination fails to develop new products and services to attract the baby boomer generation. This effect commenced in a small way in 2001 as baby boomers begin to retire and the number of prewar generation members able to travel began to decline. At the point where

50

BRUCE PRIDEAUX Number of seniors Curve 2 Baby boomer generation tourism product cycle

Emergence of a product gap commencing from 2001 Curve 1 Pre-war generation tourism product cycle

Time in years 2001

Fig. 2.

2030

Emergence of a Product Gap from 2002.

divergences occur it is necessary to refresh or rejuvenate tourism products to create a heterogeneous tourism product that appeals to both generations. In this way it will be possible to avoid the difﬁculties faced by a product in the decline stage at the end of its product life cycle. A product gap of this nature will grow if the Norfolk Island tourism industry is not able to satisfy the demand for baby boomer tourism products. The shape of the product curve has close parallels to the possible growth paths of destinations discussed by Butler (1980). Building on the basic premise of the growth and ultimate decline of products described in the product life cycle Butler proposed a similar pattern of growth and decline in destinations. The shape of Curve 1, assuming no remedial action is taken to move to the new Curve 2, roughly traces the potential of Norfolk Island to decline over time. Only a rejuvenation of product that is capable of capturing a new market, in this case baby boomers, will arrest the decline. Over time the product gap will become apparent in a number of areas including infrastructure such as hotels and in the style of products and services provided for tourists. For example, domestic Australian destinations offer a wider variety of hotel options particularly in the 3–5 star range. Baby boomers contemplating travel will thus compare domestic destinations such as Cairns, Noosa, Port Douglas, Byron Bay and Coffs Harbour with Norfolk Island and make a decision based on their personal destination choice sets preferences. Price conscious visitors will ﬁnd Norfolk Island attractive while higher yield and less price sensitive visitors are likely to

Potential Impacts of Generational Change on Destinations

51

ignore Norfolk Island because of the lack of the usual symbols of quality such as 5 stars hotels and modern upmarket shopping precincts. If the gap is not closed the Island will suffer a decline in yield as baby boomer seek other destinations in Australia including the increasingly popular coastal communities of Queensland and New South Wales. Redressing the deﬁciencies caused by the product gap will require the rejuvenation of the Burnt Pine shopping prescient to at least match the appearance of newer Australian tourism shopping enclaves such as Port Douglas and Kuranda. At the same time there is the need for a parallel rejuvenation of the style of shopping offered as well as the variety of products available for purchase. Rejuvenation should take the form of changes to the physical appearance of shopping precincts, product selection, service standards, restaurant menus, tour design and operation, the themes used for tours, interpretation used at museums, facilities at accommodation properties, and accommodation options. In addition to the emergence of the product gap there are a number of implications that the change in generation composition will have on the Island. If the Island fails or is slow to change its products and method of presentation there is some danger that total tourist numbers will continue to decline as the total population of potential pre-war generation tourists begins to decline in health and ability to travel. Alternatively, if the Island recognises that change is required and seeks to reimage its product to appeal to baby boomers it may be able to increase total visitor numbers and increase yield. There is some danger for the Island if it determines that the most appropriate course is to increase total tourist numbers because of the increased pressure that will be placed on the Island’s environment. Additional tourists will consume an even greater percentage of the Island’s ﬁnite resources than at present and the willingness of Norfolk Island residents to accept these additional demands for scarce resources will ultimately determine the acceptable limit to total tourist numbers. As an alternative strategy recognising that baby boomers are a potential high-yield market the Island has the opportunity to cap total visitor numbers but increase the economic return. While an increase in the numbers of baby boomers offers Norfolk Island a signiﬁcant opportunity to continue specialising in the older market as well as substantially increasing the total number of visitors, consideration needs to be given to the management of the Island’s physical, social, environmental and cultural resources. Norfolk Island currently has an opportunity to choose between two futures. In the ﬁrst future, based on continuing the current emphasis on the pre-war generation rather than the potentially higher yield baby boomers,

52

BRUCE PRIDEAUX

the Island is likely to suffer an overall decline in visitor number and yield over time. At the current level of yield the industry and the Island’s administration has found it difﬁcult to reinvest in infrastructure and promote new developments. In a second future based on attracting the baby boomer segment, visitor numbers could be capped and new investment encouraged to attract high-income tourists. This would ease pressure on built and natural resources, increase overall income through higher yield, generate more funds for the private and public sectors and in the long run generate a higher standard of living for Norfolk Island residents. Examples of destinations pursuing the second strategy of increasing yield in preference to increasing tourist numbers include Noosa and Port Douglas in Queensland. The Norfolk Island visitor survey conducted by Prideaux et al. (2004) found that 47% of respondents had an income of AUD$40,000 or more per annum suggesting that there already exists a substantial market sector able to pay for premium high-yield vacation experiences.

CONCLUSION Failure to adopt the type of strategies outlined in the previous discussion will result in the destination becoming increasingly sidelined from high-yield markets and result in the development of a reputation as a cheap, low-end product unable to deliver the quality experience that many of its Australian domestic competitors are able to offer. The Island will also face severe economic pressure as tourism generated funds decline and result in a fall in living standards of residents. If on the other hand if the destination’s tourism product is modiﬁed to reﬂect the changes observed in the baby boomers tastes in travel experiences and products there is enormous potential to increase yield without increasing the number of tourists. Adoption of a strategy of this nature will reduce pressure on the destination’s environment while increasing net income to all members of the community. While these issues are most evident on Norfolk Island because of the destination’s heavy investment in the older age group the growth of the baby boomer market will affect most destinations. The ﬁndings of this research indicate the need for destinations to consider the implications of generation change. In many cases the impact will be small particularly where the destination experience is collectively developed as a multi-generation product. Where destinations have focused on a speciﬁc generation cohort difﬁculties will arise if points of change are not recognised. The product gap model offers a very simple way of identifying points of change.

Potential Impacts of Generational Change on Destinations

53

REFERENCES Acumen Alliance. (2005). Department of transport and regional services Norfolk Island government financial report. Norfolk Island Government. Australian Bureau of Statistics. (1999). Australian social trends 1999, Catalogue No. 4102.0. Canberra: Commonwealth of Australia. Australian Bureau of Statistics. (2004). Australian social trends – populations – echoes of the baby boom. http://www.abs.gov.au/Ausstats/abs%40.nsf/1020492cfcd63696ca2568a100 2477b5/47f151c90ade4c73ca256e9e001f8973!OpenDocument. Accessed on 6 June 2004. Butler, R. (1980). The concept of a tourist area resort cycle of evolution: Implications for management of resources. Canadian Geographer, 14(1), 5–12. Cohen, E. (2004). Backpacking: Diversity and change. In: G. Richards, & J. Wilson (Eds), The global nomad backpacker travel in theory and practice (pp. 43–59). Clevedon: Channel View Publications. Collins, D., & Tisdell, C. (2002). Gender and differences in travel life cycles. Journal of Travel Research, 41, 133–143. Cooper, C. P., & Jackson, S. (1989). Destination life cycle: The Isle of Man case study. Annals of Tourism Research, 16(3), 377–398. di Benedetto, C. A., & Bojanic, D. C. (1993). Tourism area life cycle extensions. Annals of Tourism Research, 20, 557–570. Douglas, N. (1997). Applying the life cycle to Melanesia. Annals of Tourism Research, 24(1), 1–22. Easterby, M., Thorpe, R., & Lowe, A. (1991). Management research: An introduction. London: Sage. Edmondson, B. (1995). The next baby boom. American Demographics, 17(9), 2. Hicks, R., & Hicks, K. (1999). Boomers, Xers and other strangers. Wheaton, IL: Tyndale House Publishers. Hugo, G. (2003). Australia’s ageing population: Some challenges for planners. Paper presented at Adelaide 2003 planning congress: Leading with diversity: Cultural, social and environmental diversity in planning. Adelaide Convention Centre, Adelaide. Javalgi, R. G., Thomas, E. G., & Rao, S. R. (1992). Consumer behaviour in the U.S. pleasure travel market place: An analysis of senior and nonsenior travellers. Journal of Travel Research, 31(2), 14–19. MacCannell, D. (1973). Staged authenticity: Arrangements of social space in tourism setting. American Journal of Sociology, 79(3), 589–603. Mieczkowski, Z. (1990). World trends in tourism and recreation. New York: Peter Lang. Muller, T. E., & Cleaver, M. (2000). Targeting the CANZUS baby boomer explorer and adventurer segments. Journal of Vacation Marketing, 6(2), 154–169. Neuman, W. (2004). Basics of social research qualitative and quantitative approaches. Boston: Pearson. Prideaux, B. (2004). The resort development spectrum: The case of the Gold Coast, Australia. Tourism Geographies, 6(1), 26–59. Prideaux, B., Croswell, M., & Ng, W. Y. (2004). Norfolk Island visitor survey 2002. Cairns: James Cook University. Schewe, C. (1990). Get in position for the older market. American Demographics, 12(6), 38–44. Tomljenovic, R., & Faulkner, B. (2000). Tourism and older residents in a sunbelt resort. Annals of Tourism Research, 27(1), 93–114.

54

BRUCE PRIDEAUX

Tooman, L. A. (1997). Applications of the life in cycle models in tourism. Annals of Tourism Research, 24(1), 214–234. Tulgan, B. (2000). Managing generation X: How to bring out the best in young talent. New York: W.W. Norton & Co. Wei, S., & Ruys, H. (1998). Industry and senior perception survey. Brisbane: Ofﬁce of the Ageing, Department of Families, Youth and Community Care, Queensland Government. Wei, S., Prideaux, B., & Ruys, H. (2000). Analysis of differences in perceptions between seniors who use tour coach and tour coach operators. Asia Pacific Journal of Transport, 3(1–2), 15–22. Yin, R. K. (1994). Case study research. Thousand Oaks: Sage. Zimmerman, C. (1982). The life cycle concept as a tool for travel research. Transportation, 11, 51–69.

IMPACTS OF AN INTERVENTION EVENT ON MUSEUM VISITATIONS Rachel J. C. Chen ABSTRACT This study focuses firstly on the importance for forecasting accuracy of allowing for intervention events in the modeling process. Seasonal autoregressive integrated moving average (SARIMA) models are therefore estimated both with and without intervention effects (the September 11, 2001 events) using data for the period 1990–2001. These models are used to generate forecasts for 2002 and the first part of 2003, and forecast accuracy is assessed using mean absolute percentage error and root mean square percentage error. The second focus of the study is to examine the impacts on tourism demand of the major crises that occurred during the period 2001–2003. The chosen US metropolitan destination is New York City, which was severely affected by the September 11 events, and within New York the US Metropolitan Museum of Art is selected, as this is a very well-known and visited destination for which seasonal data are available over the period 1990–2003. The artificial neural networks (ANNs) and SARIMA forecasts are compared with forecasts generated by the much simpler automatic Holt-Winter’s seasonal double exponential smoothing model as well as two naı¨ve forecasting models to ensure that minimum performance standards are being met.

Advances in Hospitality and Leisure, Volume 3, 55–68 Copyright r 2007 by Elsevier Ltd. All rights of reproduction in any form reserved ISSN: 1745-3542/doi:10.1016/S1745-3542(06)03004-9

55

56

RACHEL J. C. CHEN

INTRODUCTION The Federal Bureau of Investigation deﬁnes terrorism as ‘‘the unlawful use of force or violence against persons or property to intimidate or coerce a Government, the civilian population, or any segment thereof, in furtherance of political or social objectives’’ (Carmen, 2003, pp. 3–4). The Defense Intelligence Agency deﬁnes terrorism as ‘‘premeditated, political violence perpetrated against noncombatant targets by sub-national groups or clandestine state agents, usually to inﬂuence an audience’’ (Carmen, 2003, p. 4). The ﬁrst international terrorist assault against the US World Trade Center (WTC) was on February 26, 1993. In the incident, a bomb exploded in the parking garage of the WTC that killed six and injured more than 100 civilians. Two years later, America was surprisingly attacked by a group of domestic terrorists. On April 19, 1995, Timothy J. McVeigh, a US citizen, bombed a federal building in Oklahoma City, killing 168 innocents. In foreign countries, terrorist activities against US citizens and properties have often taken place in the last six years. In June of 1996, a truck bomb exploded outside the Khobar Towers in Dharan, Saudi Arabia, claiming the lives of 19 US servicemen and wounded hundreds of others in the attack. In 1998 two terrorist attacks were also seen. The ﬁrst occurred on August 7 at the US embassies in Nairobi, Kenya and Dares Salaam, Tanzania. The second occurred on December 21 aboard Pan Am ﬂight 103 ﬂying over Lokerbie, Scotland (Williams, 1998). Also, on October 12, 2000 a suicidal terrorist assault killed 17 US sailors on the USS Cole in Yemen’s port of Aden. The terrorist attack in the United States, September 11, 2001, has proven to be the largest human-made disaster happening in the United States since the Civil War. This event has left a lasting impression on the United States and has had a major inﬂuence on the economy, tourism industry, government policies, and the lives/lifestyles of American citizens (Chen & Chen, 2003). Not since the Gulf War has there been such a downturn in the travel and tourism market as has been caused by the terrorist attack on September 11. While the Gulf War had a negative inﬂuence on travel in general the United States domestic market would not have witnessed such a major negative impact. Since September 11, several states including Florida, California, New York, and Nevada have lost revenue and thousands of jobs in the United States were affected (Walsh, 2001; Chen & Noriega, 2003). The insurance and airlines have been faced with huge losses, but the defense and security industries as well as the telecommunications industry have beneﬁted (Eboch, 2001; Chen & Chen, 2003; Chen, 2006).

Impacts of an Intervention Event on Museum Visitations

57

After the events of September 11, airlines suffered more than 50% decline in airline seats in October 2001 (Chen & Chen, 2003), thousands of airline employees lost their jobs (Santomero, 2002), and hotels have also encountered an unexpected slump in occupancy rates (Olsen, 2002). It is also important to keep the effects of the attacks in perspective with regards to the economy. The most noticeable change in travel is the importance of the new security systems in hotels and restaurants, entertainment centers, airports, seaports, bus stations, train stations, sports stadiums, and other large commercial complexes. More people were installing burglar alarms and a few bought guns or took self-defense instruction as a result of the attacks. Based on recent research studies, travelers felt they were more likely to visit friends and family, were more likely to stay there for longer periods of time, 79% of surveyed travelers believed that another terrorist attack is likely in the foreseeable future, and 58% have traveled less as a result of September 11 (Vlahov et al., 2002; Chen & Chen, 2003; Chen, 2006). To regroup from this terrible event will entail a vast amount of creativity on the part of tourism research divisions, marketing agencies, and professionals (Chen & Chen, 2003; Chen, 2006). Models enable scholars and experts to identify seasonality, predict demands, and examine the relationships among variables in the tourism and hospitality areas. Scholars keep constantly working to improve existing models, as well as construct new models for various tourism and hospitality analyses. The main goal of these models mentioned below is to use independent variables (such as expenditures, behaviors, destination packages, technologies, and preferences) to predict dependent variables (such as ﬁnancial decisions, site selections, productivities, visitations, and other tourism demand related evidences).

Models that Examine the Relationships among Variables in Hospitality and Tourism Logistic Regression Models Logistic regression is a statistical tool well-adopted by tourism researchers and practitioners to segment tourists into groups, discover factors that inﬂuence their travel decisions, and examine the relationship among variables. For example, De La Vina and Ford (2001) employed a logistic regression model to predict potential cruise line travelers based on various factors including visitors’ demographics, types of cruise packages, and duration of

58

RACHEL J. C. CHEN

trip. Peterson and Lambert (2003) focused on demographic characteristics of out-of-town vacationers and reported that about 60% of respondents had a vacation in the last 12 months and about 60% of them stayed in a lodging facility during their trips. Crouch and Louviere (2004) used logistic regression models within their study and found that cost of venues, physical facilities, quality of meeting spaces, planetary rooms, break-out rooms, and quality of food were the main factors that had impacts on determining site selections. Multiple Regression Models Multiple regression models have been used in hospitality and tourism research to discover how independent variables have impacts on a speciﬁc dependent variable signiﬁcantly. Toh and DeKay (2002) investigated the impacts of number of expected arrivals, early departures, and stayovernights on the level of hotel overbooking. Thrane (2005) examined how the signiﬁcant factors (size of the room, the star rating of the hotel, breakfast, restaurant, TV, and distance to the beach) could be used in predicting tourist’s willingness to pay more money while purchasing a lodging package. McGehhe and Andereck (2004) used a multiple regression model and reported that personal beneﬁts and impacts of tourism inﬂuenced the level of supports toward tourism development in rural communities. Other Models Sigala, Airey, Jones, and Lockwood (2004) surveyed UK hotel managers about the impacts of information and communication technology (ITC) on properties. Using data envelopment analysis (DEA), the study discovered how ITC had impacts on productivity. Jang and Ryu (2006) analyzed 330 ﬁnancial statements from publicly traded restaurant companies to examine relationships among selected ﬁnancial data sets. The authors employed canonical correlation analysis (CCA) and discovered interdependency existed between investment and ﬁnancial decisions. Apostolakis and Jaffry (2005) surveyed visitors of two Greek heritage attractions and employed discrete choice modeling (DCM) to understand the visitors’ preferences and interactions at the attractions. The results suggested that visitors in Crete desired to visit the heritage attractions that offer additional facilities to add to the visitor’s appreciation of the culture and authenticity of the attraction. Policy makers were also advised to focus more on advertising campaigns and publicity toward these heritage attractions (Apostolakis & Jaffry, 2005). Moss, Ryan, and Wagoner (2003) used a classical time-series decomposition model with polynomial regression and found that the product life

Impacts of an Intervention Event on Museum Visitations

59

cycle of their studied attraction followed was Butler’s S-shaped trend. The study also discovered that an increase in the square feet of gaming industry caused a decrease in the win per square foot per day of individual casinos. It suggested that US states with ﬂedging game industries should consider this trend and look for additional methods of attracting US tourists. Han, Durbarry, and Sinclair (2006) modeled US tourism demand for the European destinations of France, Italy, Spain, and the UK. An almost ideal demand system (AIDS) model was used and the sensitivity of tourism demand with various economic determinants was considered. The study found that for France, Italy, and Spain preserving a competitive price is essential, particularly between France and Italy because US tourists consider the two to be substitutes for one another as well as Spain and Italy. When US tourists have a larger budget France and Italy beneﬁt while the UK and Spain receive less market share. This study reported that the AIDS model can be useful in providing a range of information concerning tourism demand as affected by economic determinants. Finding an efﬁcient method of forecasting can be difﬁcult because of the various needs and inﬂuences of every situation as seen in the literatures (Kim & Moosa, 2005; Smeral & Wu¨ger, 2005; Moss et al., 2003; Han et al., 2006). Once the best method of forecasting is determined, a product life cycle can be established and more accurate presumptions can be made about the tourism demand for speciﬁc destinations. Although all of these studies examined slightly different aspects of the tourist industry, they were all concerned with the development or employment of appropriate models. By developing and testing these models, reviewing existing literatures, and by testing and creating new theories, researchers are able to gain further awareness in their area of study. In the ever growing tourism industry, the development of these modeling applications are especially constructive for gaining additional understanding in tourists’ decisions and behaviors. In addition, projecting the changes of the tourist ﬂows is an essential task in order to provide better strategic plans for the travel and tourism industry.

Studies in Projecting Tourist Flows Tests and comparisons between methods have been used to determine the optimal form of forecasting, as documented in Kim and Moosa (2005) and Smeral and Wu¨ger (2005). Kim and Moosa (2005) compared the accuracy of the direct and indirect methods for forecasting international tourist ﬂows in relation to Australia. The time series data used was the ﬂow of international

60

RACHEL J. C. CHEN

tourists that arrived in Australia every month grouped by length of intended stay. The methods included seasonal ARIMA models, regression-based models, and Harvey’s structural time series models. The authors found that the direct method produced forecasts directly from the aggregated time series. Meanwhile, the indirect method determined its forecasts by aggregating the data. From the comparison, there were implications that the indirect method produced a more accurate forecast for the aggregated time series. Smeral and Wu¨ger (2005) looked into whether complexity made a difference by considering various methods for improving forecasting accuracy in short-term tourism. In the study, several factors of inﬂuence were considered and models were developed. The models used include benchmark models (namely the ARIMA model), multivariate time series models, econometric indicator models, and transfer function models. The results of the study stated that the correlation between the multivariate time series model forecast values and the real forecast values was far better than that of the ARIMA model. It concluded that complexity does matter in determining the best method for forecasting. In summary, forecasting demand has attracted considerable interest. Studies that have documented the visitation forecasts are numerous and include Barry and O’Hagan (1972), Geurts (1982), Van Doorn (1984), Uysal and Crompton (1985), Summary (1987), Sheldon (1993), Archer (1994), Gonzalez and Moral (1995), Lim (1999), and Chen, Bloomﬁeld, and Fu (2003). Generally speaking, quantitative and qualitative approaches are two major types of forecasting methods. Phillimore and Goodson (2004) stated the assumptions, advantages, and limitations of qualitative methods. Classiﬁcations and some of the techniques of forecasting methods were discussed in Uysal and Crompton (1985) and Archer (1994). Chen et al. (2003) noted that quantitative forecasting methods can be classiﬁed into two categories: causal methods and time series methods. Causal methods include both regression analysis and structural models and with the capacity to identify relationships between dependent and independent variables. The reliability of ﬁnal forecast outputs do depend on the quality of other variables (Uysal & Crompton, 1985) though it is difﬁcult to statistically determine the independent variables that affect the forecast variables (Chen, 2006). This study focuses on noncausal quantitative forecasting methods. Although there is an extensive literature on the implementation of forecasting models, most of these models are applied to international arrivals at a destination country excluding the impact of sudden changes (Chen, 2006). This study focuses ﬁrstly on the importance for forecasting accuracy of allowing

Impacts of an Intervention Event on Museum Visitations

61

for intervention events in the modeling process. The second focus of the study is to examine the impacts on tourism demand of the major crises that occurred during the period 2001–2003. The chosen US metropolitan destination is New York City, which was severely affected by the September 11 events, and within New York the US Metropolitan Museum of Art is selected, as this is a very well-known and visited destination for which seasonal data are available over the period 1990–2003.

Background of the Metropolitan Museum of Art The Metropolitan Museum of Art (2003) is one of the world’s largest and ﬁnest art museums. Its collections include more than two million works of art spanning 5,000 years of world culture, from prehistory to the present and from every part of the globe. More than 5,000 works of art are loaned each year by the Metropolitan Museum to other museums and cultural institutions throughout the United States and the world. The Museum serves New York City, the United States, and people around the world with a large variety of educational training programs, fellowships, and loans of works of art. Founded in 1870, the Metropolitan Museum is located in New York City’s Central Park along Fifth Avenue (from 80th to 84th Streets). The Museum’s two-million-square-feet building has vast holdings that represent a series of collections, each of which ranks in its category among the ﬁnest in the world. The Metropolitan Museum presents more than 30 exhibitions each year, representing a wide range of artists, eras, and cultures. Some of the best known of these have been Treasures of Tutankhamun, the Vatican Collections, Van Gogh in Arles and Van Gogh in Saint-Re´my and Auvers, Splendors of Thirty Centuries, Seurat, Origins of Impressionism, Splendors of Imperial China, the Glory of Byzantium, and the Private Collection of Edgar Degas. Major gallery areas have opened in the past years, greatly enhancing the presentation of collections. In June 1998, the Arts of Korea gallery opened to the public, completing a major suite of galleries – a ‘‘museum within the Museum’’ – devoted to the arts of Asia. In October 1999, the renovated Ancient Near Eastern Galleries reopened. And a complete renovation and reinstallation of the Greek and Roman Galleries was underway: the ﬁrst phase, the Robert and Rene´e Belfer Court for early Greek art, opened in June 1996; the New Greek Galleries premiered in April 1999; and in April 2000 the Cypriot Galleries opened to the public. In 2003, it was visited by 4.6 million people. In addition, the Museum’s educational programs are

62

RACHEL J. C. CHEN

attended annually by approximately 350,000 general Museum visitors, students from grade school to university level, and teachers (Metropolitan Museum of Art, 2003).

METHODS The forecasting methods used in this study include: (1) Naı¨ ve 1, (2) Naı¨ ve 2, (3) Holt-Winter’s seasonal double exponential smoothing model, (4) seasonal autoregressive integrated moving average (SARIMA) model, and (5) artiﬁcial neural networks (ANNs). The Holt-Winter’s and Naı¨ ve models are included for comparison purposes to ensure that minimum performance standards are being met. The US Metropolitan Museum of Art data sets used in this study refer to monthly visitation ﬁgures (from January 1990 to June 2003) and were supplied by the Metropolitan Museum of Art. This study focuses ﬁrstly on the importance for forecasting accuracy of allowing for intervention events in the modeling process. SARIMA models are therefore estimated both with and without intervention effects (including, for example, the September 11 events). The second focus of the study is to examine the impacts on tourism demand of the major crises that occurred during the period 2001–2003. A comparison of the one-step out-of-sample forecasts for this period with the actual numbers of tourist arrivals should indicate the crises-induced declines. Two estimation periods were: (1) January 1990–June 2001 and (2) January 1991–June 2002. Each of the two periods consisted of 11 years of monthly visitations. Forecasts were then generated for the following 12 months, and forecast accuracy was assessed using mean absolute percentage error (MAPE) and root mean square percentage error (RMSPE). Tourist ﬂows exhibited a consistent seasonal pattern, peaking in the months of June to December (Fig. 1). Both ﬁrst differencing and 12th differencing procedures were employed for the monthly data sets to obtain stationary, nonseasonal time series.

Specifications of Forecasting Models The construction of the tourist ﬂow advanced forecasting models consisted of three stages: speciﬁcation, estimation, and evaluation. The speciﬁcation stage focused on generating, testing, and selecting an appropriate model. The estimation stage used the selected model to predict future visitation.

Impacts of an Intervention Event on Museum Visitations

63

US Metropolitan Museum of Art (Jan. 1990 - Jun. 2003) 700000

Visitation

600000 500000 400000 300000 200000 100000 0 Jul-89 Jan91

Fig. 1.

Jul-92 Jan- Jul-95 Jan94 97

Jul-98 Jan- Jul-01 Jan- Jul-04 00 03

US Metropolitan Museum of Art Monthly Visitation (January 1990–June 2003).

Finally, the evaluation phase investigated various models over time to see if there was any need to modify models and make appropriate adjustments to improve the reliability of estimates (Chen et al., 2003; Chen, 2006). The following lists the selected forecasting models used in this study. For the detailed structures of the individual formula, readers are referred to Chen et al. (2003) and Chen (2006). Naı¨ve 1. The Naı¨ ve 1 forecasting method simply states that the forecast value for this period (t) is equal to the observed value for the last period (t 1) (Makridakis, Wheelwright, & Hyndman, 1998; Chen et al., 2003; Chen, 2006). Naı¨ve 2. The Naı¨ ve 2 forecast for period t is obtained by multiplying the current visitor numbers with the growth rate between the previous visitation in time period, t 1, and the current visitation ﬁgures in time period, t (Newbold & Bos, 1994; Chen et al., 2003; Chen, 2006). Holt-Winter’s method. Holt-Winter’s three parameter linear seasonal double exponential smoothing model is widely used for its easy use and ability to generate fairly forecast (Winters, 1960; Chen et al., 2003; Chen, 2006). Seasonal autoregressive integrated moving average (SARIMA). The difference between nonseasonal and seasonal time series is that the nonseasonal relationships can be described as those between observations for successive time periods (Vt and Vt 1), whereas seasonal relationships are between observations for the same month (Vt and Vt 12) or for the same quarter (Vt and Vt 4) in successive years. The SARIMA model examines the

64

RACHEL J. C. CHEN

year-to-year relationships for each month or quarter (Box, Jenkins, & Reinsel, 1994). When an external intervention impinges on the time series at time t, then its impact breaks the series into two segments, pre-intervention and post-intervention. The form of an intervention model indicates that Nt (noise component) represents the SARIMA component of a model. The error terms, et, associated with Nt are assumed to have a zero-mean, constant variance and to be serially independent. When the error terms possess these properties, then the et sequence is a white-noise process (Chen, 2006). Artificial neural network (ANN). The ANN model is a recurrent network. The input to the network at time t is from the activations in the hidden layer at time t 1. The reaction of the network to the new input is a function of both the new input and the preceding context. And a compressed trace of all preceding inputs inﬂuences each succeeding input (Elamn, 1990; Jhee & Lee, 1996; Chen, 2006). Forecasting Performance: Implication of MAPE and RMSPE MAPE and RMSPE (Chen et al., 2003; Chen, 2006) were selected to evaluate the performance of forecasting methods. Both MAPE and RMSPE were calculated from one-step out-of-sample forecast errors. The results of MAPE and RMSPE show the performances of the various forecasting methods for one-year-ahead forecasting horizons with and without intervention events.

FINDINGS The total impact of the September 11, 2001 intervention event on the US Metropolitan Museum of Art has been to cause demand to decrease by approximately 14% in terms of the number of ticket sales over the period September 2001–June 2003. The data did indicate September 2001 as the month of ﬁrst impact (34% decrease compared to ticket sales in September 2000). Then, the Museum continued to experience drops in ticket sales especially in October, November, and December (decreased by 27% on average compared to the previous winter season ticket sales) during the year of 2001. After August 2002, the recovery began. In the case of the monthly US Metropolitan Museum of Art visitations, the MAPE and RMSPE values revealed that SARIMA was the best among all the techniques when the intervention events were estimated. The MAPE and RMSPE values of the ANN methods were also small. The Naı¨ ve 2

Impacts of an Intervention Event on Museum Visitations

Table 1.

65

Evaluations of Forecasting Performances.

Model

MAPE

RMSPE

{Estimation Period}: Forecasting Period (1) Naı¨ ve 1 {January 1990–June 2001}: July 2001–June 2002 {January 1991–June 2002}: July 2002–June 2003

31.47 (3) 18.71 (3)

38.07 (3) 21.59 (3)

(2) Naı¨ ve 2 {January 1990–June 2001}: July 2001–June 2002 {January 1991–June 2002}: July 2002–June 2003

41.17 (5) 38.42 (5)

63.31 (5) 42.41 (5)

(3) Holt-Winter’s method {January 1990–June 2001}: July 2001–June 2002 {January 1991–Jun. 2002}: July 2002–June 2003

40.80 (4) 21.04 (4)

45.19 (4) 22.88 (4)

(4) Seasonal autoregressive integrated moving average (SARIMA) {January 1990–June 2001}: July 2001–June 2002 27.39 (1) {January 1991–June 2002}: July 2002–June 2003 9.12 (1)

32.30 (1) 12.13 (1)

SARIMA with intervention analysisa {January 1990–June 2001}: July 2001–June 2002 {January 1991–Jun. 2002}: July 2002–June 2003

15.62 (1) 12.07 (1)

22.26 (1) 19.81 (1)

(5) Artiﬁcial neural network (ANN)a {January 1990–June 2001}: July 2001–June 2002 {January 1991–June 2002}: July 2002–June 2003

29.15 (2) 16.38 (2)

35.33 (2) 20.11 (2)

Note: Figures in parentheses denote rankings. For example, based on the examination of the MAPE and RMSPE values, SARIMA (ranked 1) was the best and Naı¨ ve 2 (ranked 5) performed worst, when the intervention event was included and the next 12 month forecasts were calculated. a Intervention events in the modeling process.

model performed worst. When intervention events were not considered, the SARIMA model still performed best for the monthly US Metropolitan Museum of Art visitations, while the Naı¨ ve 2 was still the worst (Table 1). Application of Results and Conclusions SARIMA had the lowest forecasting error and Naı¨ ve 2 had the highest error for monthly US Metropolitan Museum of Art visitation forecasts when intervention events were considered. When intervention events were excluded the SARIMA model still generated the most accurate forecasts. The ANN model generated the second best forecast overall.

66

RACHEL J. C. CHEN

With regards to the merits and limits of the Naı¨ ve methods, Holt-Winter’s method, and SARIMA method, readers are referred to Chen et al. (2003). A main limitation of both SARIMA and ANN methods is that longer histories are required than other forecasting methods to yield reliable results. An advantage shared by the SARIMA method and the ANN method is that both can blend intervention variables into models to provide more accurate forecasts (Chen, 2006). As Chen’s previous studies (2003, 2006) noted, tourism planners need short-, medium-, and long-term forecasts to establish their strategic marketing plans, pricing, facility monitoring, seasonal employment, budgeting, and future infrastructure needs. The impact of the September 11, 2001 intervention event on the US Metropolitan Museum of Art has been to cause demand to decrease by approximately 14% in terms of the number of ticket sales over the period September 2001–June 2003. For future studies, analysts are encouraged to add current and past intervention events among various destinations to investigate the demand changes and predict the nature of the impact of particular types of shocks upon tourist ﬂows. Various interventions and shocks may include ﬁnancial crises, outbreaks of diseases, and adverse weather conditions.

REFERENCES Apostolakis, A., & Jaffry, S. (2005). A choice modeling application for Greek heritage attractions. Journal of Travel Research, 43(1), 309–318. Archer, B. H. (1994). Demand forecasting and estimation. In: J. R. B. Ritchie, & C. R. Goeldner (Eds), Travel, tourism and hospitality research (4th ed., pp. 105–114). New York: Wiley. Barry, K., & O’Hagan, J. (1972). An econometric study of British tourist expenditure in Ireland. Economic and Social Review, 3(2), 143–161. Box, G. E. P., Jenkins, G. M., & Reinsel, G. C. (1994). Time series analysis: Forecasting and control (3rd ed.). Englewood Cliffs, NJ: Prentice-Hall. Carmen, A. (2003). Terrorism: An interdisciplinary perspective (2nd ed.). Wadsworth: Thomson Learning, Inc. Chen, R. J. C. (2006). An evaluation of alternative forecasting methods for tourist ﬂows before and after the inclusion of intervention events. Tourism Analysis, 10(3), 269–276. Chen, R. J. C., Bloomﬁeld, P., & Fu, J. (2003). An evaluation of alternative forecasting methods to recreation site use. Journal of Leisure Research, 35(4), 441–454. Chen, R. J. C., & Chen, J. (2003). Terrorism effects on travel arrangements and tourism practices. International Journal of Hospitality and Tourism Administration, 4(3), 49–63. Chen, R. J. C., & Noriega, P. (2003). The impacts of terrorism: Perceptions of faculty and students on safety and security in tourism. Journal of Travel and Tourism Marketing, 15(2/3), 81–97.

Impacts of an Intervention Event on Museum Visitations

67

Crouch, G. I., & Louviere, J. J. (2004). The determinants of convention site selection: A logistic choice model from experimental data. Journal of Travel Research, 43(4), 118–130. De La Vina, L., & Ford, J. (2001). Logistic regression analysis of cruise vacation market potential: Demographic and trip attribute perception factors. Journal of Travel Research, 39(2), 406–410. Eboch, E. (Ed.) (2001). Attacks affects U.S. economy. Conservative Monitor. Retrieved November 21, 2003, from http://www.conservativemonitor.com/ﬁnance/2001009.shtml. Elamn, J. L. (1990). Finding structure in time. Cognitive Science, 14, 179–211. Geurts, M. (1982). Forecasting the Hawaiian tourist market. Journal of Travel Research, 21(2), 21–28. Gonzalez, P., & Moral, P. (1995). An analysis for the international tourism demand in Spain. International Journal of Forecasting, 11(2), 233–251. Han, Z., Durbarry, R., & Sinclair, M. T. (2006). Modeling US tourism demand for European destinations. Tourism Management, 27(1), 1–10. Jang, S., & Ryu, K. (2006). Cross-balance sheet interdependencies of restaurant ﬁrms: A canonical correlation analysis. International Journal of Hospitality Management, 25, 159–166. Jhee, W. C., & Lee, J. K. (1996). Performance of neural networks in managerial forecasting. In: R. R. Trippi, & E. Turban (Eds), Neural networks in finance and investing (pp. 703–733). Chicago: IRWIN. Kim, J. H., & Moosa, I. A. (2005). Forecasting international tourist ﬂows to Australia: A comparison between the direct and indirect methods. Tourism Management, 26(1), 69–78. Lim, C. (1999). A meta-analytic review of international tourism demand. Journal of Travel Research, 37(2), 273–284. Makridakis, S., Wheelwright, S. C., & Hyndman, R. J. (1998). Forecasting: Methods and applications (3rd ed.). New York: Wiley. McGehhe, N. G., & Andereck, K. L. (2004). Factors predicting rural residents’ support of tourism. Journal of Travel Research, 43(4), 131–140. Metropolitan Museum of Art (2003). Retrieved July 1, 2003, from http://www.metmuseum.org/ Moss, S. E., Ryan, C., & Wagoner, C. B. (2003). An empirical test of butler’s resort product life cycle: Forecasting casino winnings. Journal of Travel Research, 41(4), 393–399. Newbold, P., & Bos, T. (1994). Introductory business and economic forecasting (2nd ed.). Cincinnati, OH: South-Western Publishing Co. Olsen, J. (2002). Delta representatives: Airlines have lost $8 billion since September 11. The Enterprise, 31(43), 1. Peterson, M., & Lambert, S. L. (2003). A demographic perspective on US consumers’ outof-town vacationing and commercial lodging usage while on vacation. Journal of Travel Research, 42(4), 116–124. Phillimore, J., & Goodson, L. (2004). Qualitative research in tourism. New York: Taylor & Francis Group. Santomero, P. (2002). The reluctant recession: Why was the recession so mild? New York: Levy Institute Conference. Retrieved December 1, 2003, from http://www.phil.frb.org/ publicaffairs/speeches/santomero22.html. Sheldon, P. J. (1993). Forecasting tourism: Expenditures versus arrivals. Journal of Travel Research, 32(1), 13–20. Sigala, M., Airey, D., Jones, P., & Lockwood, A. (2004). ICT paradox lost? A stepwise DEA methodology to evaluate technology investments in tourism settings. Journal of Travel Research, 43(4), 180–192.

68

RACHEL J. C. CHEN

Smeral, E., & Wu¨ger, M. (2005). Does complexity matter? Methods for improving forecasting accuracy in tourism: The case of Austria. Journal of Travel Research, 44(1), 100–110. Summary, R. (1987). Estimation of tourism demand by multivariable regression analysis: Evidence from Kenya. Tourism Management, 8(3), 317–322. Thrane, C. (2005). Hedonic price models and sun-and-beach package tours: The Norwegian case. Journal of Travel Research, 43(1), 302–308. Toh, R. S., & DeKay, F. (2002). Hotel room-inventory management: An overbooking model. Cornell Hotel and Restaurant Administration Quarterly, 43(4), 79–90. Uysal, M., & Crompton, J. L. (1985). An overview of approaches used to forecast tourism demand. Journal of Travel Research, 23(1), 7–15. Van Doorn, J. W. M. (1984). Tourism forecasting and the policymaker: Criteria of usefulness. Tourism Management, 5(1), 24–39. Vlahov, D., Galea, S., Resnick, H., Ahern, J., Boscarino, J. A., Bucuvalas, M., Gold, J., & Kilpatrick, D. (2002). Increased use of cigarettes, alcohol, and marijuana among Manhattan, New York, residents after the September 11th terrorist attacks. American Journal of Epidemiology, 155(11), 988–996. Walsh, M. W. (2001). Many once thriving cities are suddenly hurting. New York Times, 41(1), 34–36. Williams, D. (1998). The bombing of the World Trade Center in New York City. International Criminal Police Review. Retrieved November 2, 2003, from http://www.interpol.int/ Public/Publications/ICPR/ICPR469_3.asp. Winters, P. R. (1960). Forecasting sales by exponentially weighted moving averages. Management Science, 6(1), 324–342.

CRITICAL FACTORS IN IMPLEMENTING HRIS IN RESTAURANT CHAINS Khaldoon ‘‘Khal’’ Nusair and H. G. Parsa ABSTRACT Hospitality literature is deficient in empirical research that specifically focused on human resource information systems (HRIS) in hospitality. To fill this gap in literature, this research has proposed a model, based on a review of previous research, to serve as a starting point toward building an empirical research agenda in the hospitality discipline. It has two primary objectives: firstly, to examine the factors that contribute to the decision to implement a HRIS in a small-size restaurant chain; and secondly, to develop a research agenda in an area where progress has been limited in the hospitality discipline. Results of the current study indicated that financial resources, culture, and computer competency are better predictors of any successful implementation of HRIS in restaurant chains.

INTRODUCTION The human resource (HR) function of hospitality organizations is changing rapidly, reacting to the changes occurring in its operating environment and the rapidly evolving information technologies (Hendrickson, 2003). Clearly, Advances in Hospitality and Leisure, Volume 3, 69–86 Copyright r 2007 by Elsevier Ltd. All rights of reproduction in any form reserved ISSN: 1745-3542/doi:10.1016/S1745-3542(06)03005-0

69

70

KHALDOON ‘‘KHAL’’ NUSAIR AND H. G. PARSA

developments in the information technology ﬁeld have affected the traditional HR functions and have created signiﬁcant challenges for HR professionals in adapting technological innovations. To meet these challenges, many organizations have turned to information systems technology (Simon & Werner, 1996). These information technologies have led to a widespread implementation of human resource information systems (HRIS) that allow organizational staff to participate in information sharing and decisionmaking (Mayﬁeld, Mayﬁeld, & Lunce, 2003). In other words, the HRIS solutions are capable of transforming the traditional HR functions into a comprehensive human capital program, delivering strategic, ﬁnancial and competitive beneﬁts. HRIS has recently become vital partners in developing and implementing organization HR strategies. Tang, Yeunig, and Edmund (1987) pointed out that the prominent factor in the effective planning of human resources and improvement of people productivity is an effective HRIS. Computer-based information technologies have resulted in widespread usage of HRIS applications that are helping to improve the efﬁciency and the effectiveness of HR function, and are enabling a greater focus on making a strategic contribution to the hospitality industry. According to Broderick and Boudreau (1992), HRIS is ‘‘the composite of databases, computer applications, and hardware and software necessary to collect/record, store, manage, deliver, present, and manipulate data for human resources’’. Similarly, Tannenbaum (1990) referred to HRIS as a systematic procedure to acquire, store, manipulate, analyze, retrieve, and distribute information about an organizations’ human resources. In terms of the beneﬁts of HRIS, Fein (2001) stressed that managers rely on the HRIS capabilities to provide superior data collection and analysis, particularly for the purposes of performance appraisals and performance management, skill testing, resume processing, recruiting and retention, team and project management, and management development. Thus, as the case with any organizational information system, a HRIS is much more than a software package and a hardware component; as a computer system it includes elements such as processes, policies, and people all combined to manage the HR function. Companies have started to realize the importance of human resources as an integral part of the organizations’ effectiveness between 1945 and 1960. During this period no signiﬁcant achievements within the HRIS were acknowledged, however it set the stage for an explosion of changes that began in the 1960s (Lederer, 1984; Kavanaugh, Gueutal, & Tannenbaum, 1990). In the early 1960s, ﬁrst automation of HR functions were introduced, but it was limited to simple functions such as payroll, beneﬁts administration, and

Critical Factors in Implementing HRIS in Restaurant Chains

71

other transaction processing applications (Martinsons, 1996). But over the past two decades, the HR function has become very sophisticated putting tremendous pressure on practitioners to ﬁnd solutions to handle various HR functions efﬁciently. Consequently, hospitality organizations have realized the need to invest in HRIS applications that improve the effectiveness of HR practices and those that increase the quality of the organization’s human resources. Ulrich (1997) stated that if HR does not meet the challenge of change, it is at the risk of being dissolved. For HR to meet these challenges; literature has shown that over 90 percent of organizations have a formalized and a separate HRIS department or an equivalent (Cholak & Simon, 1991). HR managers are frequently advised to establish an effective HRIS to assist in decisionmaking, as a result a widespread use of HRIS has occurred (Tansley & Watson, 2000). Moreover, a survey of 649 ﬁrms of varying sizes conducted by Bethesda, Maryland-based Watson Wyatt Worldwide (2002) concluded that nearly every organization had made signiﬁcant investments in HRIS applications. Although the HRIS grew in importance over the past two decades in the industry, few academic research studies have focused on HRIS, and many of these studies have been descriptive and lacked the support of quantitative analyses (Kovach & Cathcart, 1999; Ngai & Wat, 2004; Haines & Petit, 1997). Additionally, many other studies suggested that the HR function is a dilatory in terms of IT usage (Hall & Torrington, 1998; Kinnie & Arthurs, 1996). In the same vein, literature is devoid of high-quality empirical research that is speciﬁcally focused on HRIS in hospitality. To ﬁll this gap in hospitality literature, this study proposes a model, based on a review of previous research, to serve as a starting point toward building empirical research agenda in hospitality ﬁeld. This study has two objectives. Firstly, to examine the factors that contribute to the decision to implement a HRIS in a small-size restaurant chain. To achieve this objective, current study explains four of the organizational variables namely ﬁrm size, ﬁnancial resources, culture, and computer competency. These organizational variables are expected to inﬂuence the decision of whether to implement a HRIS application or not. Top management is normally considered as being reluctant to implement HRIS solutions unless they are convinced that the beneﬁts would surpass the costs associated with the implementation. Thus, this study will explore the beneﬁts of adoption of HRIS in terms of two variables: efficiency and effectiveness. These two terms can be deﬁned as ‘‘speed and quality of information, accuracy of information, access to information, data-control, costs, savings, ﬂexibility,

72

KHALDOON ‘‘KHAL’’ NUSAIR AND H. G. PARSA

workload, user-friendly, usefulness, conﬂict within departments, improve productivity, performance, proﬁtability, and service quality (Efficiency) and ‘‘processes simpliﬁcation, decision-making improvements, intelligence of the system, and achievements of desired goals’’ (Effectiveness). The second and more general objective of the study is to develop a research agenda in an area where progress has been limited in the hospitality ﬁeld. The review of current literature on this subject reveals a lack of research addressing the factors that contribute to the decision whether to implement a HRIS in the hospitality industry. In order to examine the extent to which the hospitality industry has adopted HRIS, as well as to enable HR practitioners to have a better understanding of the beneﬁts to implementing a HRIS in a small-size restaurant chain, a standard questionnaire was used to collect data through three personal interviews with the top management team of a regional restaurant chain with over 400 units.

LITERATURE REVIEW Organizational Variable Company Size A study by Hall and Torrington (1998) was the ﬁrst to examine the relationship between the size of a ﬁrm and the HRIS adoption. Literature has shown conﬂicting results regarding the capabilities of small ﬁrms with respect to HRIS implementation. For example, Thaler-Carter (1998) observed that small ﬁrms would go for low cost and low risk HRIS application. Ball (2001) concluded that smaller ﬁrms are less likely to use HRIS solutions. In addition, small ﬁrms are unlikely to use HRIS for training and recruitment. Delone (1981) also suggested that small businesses face unique problems in the management of their computer resources. From Martinson’s (1994) perspective, HRIS is not used effectively in smaller ﬁrms. On the contrary, Raymond (1985) found that small ﬁrms are capable of internally developing and implementing their own information system applications. Likewise, according to Cooley, Waltz, and Waltz (1987) there are two factors behind the increased usage of information systems in small ﬁrms. These factors are: (1) the lowered costs of computer software and hardware; and (2) computers are becoming increasingly user-friendly not requiring much computer expertise. On the other hand, Ivancevich (1998) indicated that larger companies often tend to be equipped with better HR professionals than small

Critical Factors in Implementing HRIS in Restaurant Chains

73

ﬁrms. Ein-Dor and Segev (1978) contended that HRIS applications are more likely to succeed in large organizations. H1. Small firms are internally incapable of implementing HRIS applications. Financial Resources Markland (1972) stated that small ﬁrms are always faced with limited ﬁnancial resources. As a result, budget for computer technology is often constrained (Cohn & Lindberg, 1972). Presumably, HRIS packages are expensive to acquire and to maintain. There are several costs associated with implementing a HRIS, for example, software license, hardware, implementation, consulting, and training. Beckers and Bsat (2002) indicated that the high cost associated with setting up and maintaining the HRIS are the major challenges in successful implementation of a HRIS. A survey by Price Waterhouse revealed that senior IT executives identiﬁed cost as one of the major challenges in the deployment of new computer information systems (Desai, Wright, & Fletcher, 1998). In order for ﬁrms to overcome the ﬁnancial obstacles, the HRIMS Conference proposed a list of the best applications in which HRIS can save companies money (IOMA, 2002a, 2002b): 1. Open enrollment: web-based enrollment in beneﬁt programs saves time and paper. 2. Managed care: as employers move into managed care, HRIS can yield signiﬁcant savings. 3. Online payroll: having employees view their pay stubs online can slash costs of paper, especially if it is combined with direct deposit. 4. Surveys: online surveys of employees and managers are very easy to do and yield valuable information. 5. On-boarding: automated applications that get newly hired employees up to speed before they arrive on the premises can save both time and money. 6. Succession planning: using outside recruiters is very costly. On the other hand, promoting from within can reduce these costs. In other words, applications that help with succession planning are essential to adopt. 7. Talent management: e-recruiting and talent management applications, including resume screening and tracking software, can make the process much more efﬁcient. 8. Compensation: a valuable offering for employees and managers is a total compensation booklet. It is basically, a snapshot of the value of an employee’s salary and beneﬁts. As an online application, this can be a very effective tool to use for various what-if scenarios.

74

KHALDOON ‘‘KHAL’’ NUSAIR AND H. G. PARSA

9. E-learning: a primary mission of training is employee retention. Given the high cost of training, HRIS can help to reduce turnover rates. Training HRIS systems can match the speciﬁc training requirements of various jobs with the training needs of employees. HRIS can be used to monitor which employees have had the training, when, what topics, and results of training. Moreover, HRIS can increase the efﬁciency of managing the training needs of a large number of employees in hospitality. H2. Insufficient financial resources are perceived as barriers to implement HRIS programs in small firms. Culture Culture represents the values and norms that are shared within an organization. Culture plays an important role in determining the areas in which the employees are able to learn easily and those in which employees are likely to resist the proposed change (Antal, Diekes, & Hahner, 1997). Brown and Starkey (1994) pointed out that ‘the culture of an organization is an important factor affecting attitudes to, and systems and processes pertaining to, the management of information and communication’. Previous studies have established the importance of top management support in information systems implementation (Bruwer, 1984; Doll, 1985). Researchers have found that top management support is one of the consistent factors critical to information systems effectiveness (Cerveny & Sanders, 1986; Keen & Morton, 1978). Yeung and Brockbank (1995) stated that lack of top management support is a stumbling block for reengineering the HR function. Additionally, Keil, Cule, Lyytinen, and Schmidt (1998) indicated that the failure of the HRIS implementation is due to ineffective communication with users, and lack of users’ commitment. In the context of small ﬁrms, the CEO plays a critical role in the decision to adopt a HRIS system as most small ﬁrms have a ﬂat organizational structure and are managed by the owner who is usually the CEO (Raymond & Magnenat-Talmann, 1982; Solomon, 1986). The importance of top management support in implementing HRIS solutions led Kovach and Cathcart (1999) to speculate that lack of top management support is one of the biggest challenges in realizing the full potential of HRIS. H3. In small firms, there is no relationship between top management support and the decision to implement a HRIS program. Computer Competency Users with more computer experience are expected to be more conﬁdent in their ability to use the HRIS and are more satisﬁed with the experience

Critical Factors in Implementing HRIS in Restaurant Chains

75

(Igbaria & Nachman, 1990). On the other hand, people with less computer experience are more likely to be anxious when confronted with IT (Igbaria & Parasuraman, 1989). Managerial IT knowledge reﬂects the knowledge of IT managers about the ﬁrm and the strategic issues within the ﬁrm, as well as the potential opportunities resulting from the implementation of information technology solutions (Boynton, Zmud, & Jacobs, 1994). In fact, Boynton et al. (1994) found that managerial IT knowledge inﬂuenced the extent of information technology usage in a ﬁrm. H4. Top management with computer experience is more likely to be confident in their ability to use the HRIS program. H5. The greater the level of managerial IT knowledge, the higher the probability of success in implementing a HRIS program. Benefits of Adoption The HRIS, as a database system that helps the ﬁrm keeping track of all types of information related to the ﬁrm and its human capital, has many beneﬁts. There are several advantages for adopting a HRIS: increase competitiveness by improving the HR operations; produce a complex HR related reports; shift the focus of HR from the processing of transactions to strategic decision-making; and make the employees part of the HRIS (Beckers & Bsat, 2002). However, there are several obstacles that face management when deciding whether to adopt a HRIS. Some of the examples of obstacles include limited budgetary resources, lack of qualiﬁed professional staff, and lack of company-wide commitment. Therefore, it is imperative for management to be persuaded that the beneﬁts of adoption outweigh the challenges associated with the implementation. It is conceivable that ﬁrms rely on the HRIS to fulﬁll their job functions in the areas of regulatory reporting and compliance, compensation analysis, payroll, pension, and proﬁt sharing administration, skill development and skill inventory, beneﬁts administration, etc. (Hendrickson, 2003). According to Kovach, Hughes, Fagan, and Maggitti (2002), the purpose of HRIS is to provide information that could be used, ﬁrstly, for administrative purposes which reduce costs and time, and, secondly, for decision-support purposes which assist HR managers and employees to make better decisions. In sum, it is apparent that ﬁrms adopt HRIS in order to attain both efﬁciency and effectiveness in HR function. Efﬁciency measures such as lower business operating costs, higher productivity, lower head count, accuracy, less product waste, access

76

KHALDOON ‘‘KHAL’’ NUSAIR AND H. G. PARSA

to information, and ﬂexibility or other primary outcomes that justify IT expenditure (Rosser, 2001). For example, a successful HRIS application was implemented by MCI Telecommunications. The resume-tracking system implemented by MCI has helped to improve the efﬁciency of HR function, which allows a quick and accurate identiﬁcation of qualiﬁed applications (Stevens, 1993). Additionally, HRIS allows more transactions to be processed with fewer resources. At MCI, implementation of HRIS has improved the effectiveness of HR in terms of the accuracy of information and process simpliﬁcations (Hendrickson, 2003). Sadri and Chatterjee (2003) reported that HRIS applications result in faster decision-making in terms of development, planning, and management of human resources. Patterson, West, Lawthom, and Nickell (1997, p. 13) stated that ‘‘HRM practices can improve company performance by: promoting positive attitudes and increasing motivation, and by providing employees with expanded responsibilities so that they can make full use of their skills and abilities’’. According to Broderick and Boudreau (1992), HRIS contribute signiﬁcantly to cost reductions, quality/customer satisfaction, and innovation. Furthermore, HRIS is essential since manpower planning is a difﬁcult activity due to the high level of unplanned redundancies at workplace (Tansley & Watson, 2000). At present, it would be difﬁcult to imagine any organization achieving and sustaining effectiveness without efﬁcient HRM programs and activities (Schuler, 2000). Among the major challenges in implementing HRIS involve issues of training and development, efﬁciency and ﬂexibility, and employee relations (Gomez-Meija & Cardy, 2001). Therefore, this study is meant to analyze the various challenges and examine their relation to organizational effectiveness. H6. HRIS application improves the efficiency of the HR function in terms of: a. quick access to information and in terms of accuracy. b. reducing the operating costs. H7. HRIS application improves the effectiveness of the HR function in terms of making better human resource decisions.

RESEARCH METHODOLOGY A case study research methodology was used for this study, and a standard questionnaire was used to collect data through three personal interviews

Critical Factors in Implementing HRIS in Restaurant Chains Organizational Variables

77

Benefits of Adoption Improved Efficiency:

Firm size

Financial Resources

H1

H2

-Speed and Accuracy

H

H6

R H3

Culture

I S

H7

Fig. 1.

Improved Effectiveness

-Decision Making Improvement

H4 Computer Literacy

-Cost Reduction

H5

-Desired Management Goals

Role of Organizational Variables in HRIS Programs Implementation and Beneﬁts of Adoption.

with the top management team. The same open-ended questions were asked of all interviewees allowing greater comparability among the responses. Interviews were conducted with a regional, small restaurant chain with over 400 units. Though it has 400 units, it is still considered as a smaller chain because it is small compared to the larger chains such as McDonalds with over 30,000 units etc. Three top managers, Director of Operations; Director of Information Systems; and Director of Marketing have taken part in this study. The content of the standardized questionnaire focused on: (1) the factors that are taken into consideration by top management when deciding whether to implement a HRIS program; and (2) the beneﬁts of adoption. Personal interviews were conducted between December 2004 and January 2005 (Fig. 1).

DISCUSSION Organizational Variables Company Size H1. Small firms are internally incapable of implementing HRIS applications. (Partially supported) The most signiﬁcant ﬁnding of the study is that small restaurant chains are capable of internally developing HRIS solutions but the help of external resources are required for a successful implementation. Smaller restaurant

78

KHALDOON ‘‘KHAL’’ NUSAIR AND H. G. PARSA

chains may ﬁnd that the internal resource people assigned to the project do not have the skills or capabilities needed for the job. Sometimes training could resolve the issues, however in other situations the people may lack the skills to carry out the project especially when the project requires business process reengineering. Under these conditions, small restaurant chains rely on external resources, i.e. contractors or consultants. For example, a small restaurant chain may hire a consulting company to set up its IT training programs. However, there is evidence that the more an implementation team relies on external resources the more difﬁcult it will be for the company to become selfsufﬁcient in ongoing HRIS support, maintenance, and operations. In terms of the operability of the system, this study revealed that the HR department in small-size restaurant chains uses the HRIS applications primarily for HR functions and non-HR uses are discouraged. Beneﬁt administration; payroll administration; HR planning; employee scheduling; and employee/management training are the HR activities most frequently handled by the HRIS in a small restaurant ﬁrm. Additionally, the ﬁndings indicated that because of the small size of the company, it is difﬁcult to costjustify new technologies. As suggested by Hagwood and Friedman (2002), one of the most signiﬁcant challenges faced by most ﬁrms today is measuring the performance of their human resource information system in order to justify the value-added contribution of the HRIS in accomplishing organization’s mission. Financial Resources H2. Insufficient financial resources are perceived as barriers to HRIS implementation. (Supported) The results with respect to the second hypothesis indicated that small-size chain restaurant ﬁrms recognize the need to invest in HRIS applications to improve efﬁciency and effectiveness, but due to inadequate ﬁnancial resources they often ﬁnd themselves unable to prioritize their HRIS investments. Therefore, the current ﬁndings indicated that a small-size chain ﬁrm is often left spending very little resources on HRIS applications because it is unsure how to best secure the required ﬁnancial resources. Also, limited ﬁnancial resources constrain small-size chain ﬁrms from investing in some HRIS applications (i.e. employee skill testing, employee screening, compliance tracking and reporting, web-enabled training, and many other expensive solutions). In addition, budget constraints in a small-size restaurant chain make it impossible to hire qualiﬁed employees to carry out the project. However, according to top management team in this study, even with

Critical Factors in Implementing HRIS in Restaurant Chains

79

budget cuts, management still tries to focus on areas in which HRIS can have major returns on investment. This could be accomplished by meeting with the vendors and consultants to ﬁnd out more about the latest developments in the HRIS solutions. Some of the questions to be asked: What are the best solutions that ﬁt the ﬁrm’s mission? What kind of things are HRIS consultants doing with their big/small clients? Culture H3. There is no relationship between top management support and the decision to implement a HRIS program. (Not supported) Culture refers to a ﬁrm’s fundamental beliefs about the way it should function, its accepted norms of behavior and the path toward achieving its objectives and goals (Schein, 1994). Studies have suggested that organizational culture impacts technology adoption (Ruppel & Harrington, 2001; Zammuto & O’Connor, 1992). Likewise, the results of this study conﬁrmed that HRIS adoption is largely related to top management support. The ﬁndings have shown that the ﬁrm’s executive management is the sponsor of any HRIS project. Support from executive management is invaluable for making sure new business processes are implemented effectively, for funding the project, and for ensuring appropriate stafﬁng on the project team. Consistent with the ﬁndings of this case study, the CEO of the current ﬁrm has always supported the establishment of IS/IT department to look for HRIS solutions that could optimize efﬁciency and effectiveness. Computer Competency H4. Users with computer experience are more confident in their ability to use the HRIS. (Supported) H5. The greater the level of managerial IT knowledge, the higher the probability of success in implementing a HRIS program. (Supported) The users of HRIS often include diverse groups ranging from functional specialists to executives to clerical staff (Kossek, Young, Gash, & Nichol, 1994). Computer skill/knowledge is a predictor of differences in commitment toward HRIS (Kossek et al., 1994). As suggested by Lopez (1981), the computer knowledge is important to overcome resistance to computer use. In terms of the hypotheses related to computer competency (H4, H5), this study demonstrated that users’ computer experience and cooperation plays a vital role in successful implementation of HRIS in a small-size restaurant

80

KHALDOON ‘‘KHAL’’ NUSAIR AND H. G. PARSA

chain. Users with computer experience/knowledge were more responsive to technology implementation. In addition, this study also revealed that novice users of computers are less likely to accept the use of HRIS. On the other hand, the computer savvy management team strongly champions that, in order to stay competitive, companies need to invest in HRIS related applications. Likewise, this research showed that the HRIS adoption is largely related to top management support and IT knowledge in the organization. In sum, in a small-size restaurant chain, management team guides the HRIS installation processes in the adoption, implementation, and institutionalization phase. Greater the depth of computer knowledge of the top management team, greater the success of HRIS implementation in small-size restaurant chains.

Benefits of Adoption H6. HRIS application improves the efficiency of the HR function in terms of: a. quick access to information and in terms of accuracy. (Supported) b. reducing the operating costs. (Supported) H7. HRIS application improves the effectiveness of the HR function in terms of making better human resource decisions. (Supported) Using the HRIS solutions to improve on the HR practices can add some value to the operational and tactical/decision-making activities inherent in HR function; in addition, HRIS contributes to greater efﬁciency in current HR practices and, at the same time, reduces overhead costs (Tansley et al., 2001). The present study demonstrated that the time spent entering employee information into the HRIS program in the beginning is quickly redeemed when accessing the information at a later date (hypotheses H6-a, H6-b). In a small restaurant chain, having all of the employee data such as name, age, date of employment, disability, and health and salary information, at one place made later accessibility quick and easy. Using a HRIS, the HR administrator could access the appropriate information and provide necessary answers efﬁciently with little or no time loss. The primary beneﬁt of HRIS program implementation was a restaurant chain company with efﬁcient administrative processes thus satisﬁed management and employees, and organizational records that are more accurate and up-to-date. For example, the company in this study successfully used Digital Persona’s Fingerprint Authentication technology to ensure positive identiﬁcation

Critical Factors in Implementing HRIS in Restaurant Chains

81

when enrolling 6,000 employees for healthcare beneﬁts in more than 400 locations. This system has allowed signiﬁcant fraud reduction and administrative efﬁciency. Results from the current study also exhibited that HRIS applications help small ﬁrms to improve the efﬁciency of HR function. For example, in this study Trans Biometric Technologies helped the company to streamline enrollment; cut out manual processing, eliminating paperwork which has resulted in signiﬁcant savings for the company. This system has also resulted in direct reduction in payroll costs and helped to optimize organizational efﬁciency of HR functions. In addition, this system has two other beneﬁts: (1) it allows making adjustments anytime to accommodate growth and organizational changes; and (2) it allows the HR department to control the accuracy and timeliness of information being communicated to employees. Finally, this small restaurant chain ﬁrm has invested signiﬁcantly in HRIS applications that provide strategic improvement to HR function and consistent with the desired optimal objectives. Some of the examples of some applications include savings in labor scheduling, health care enrollment and payroll management. Moreover, effectiveness was also achieved because top management has spent more time in decision-making and strategic planning. The result was a more informative decision-making, ability to identify problem areas, speedy response to changing markets and competitive dynamics, and competitive advantage in HR functions.

FUTURE RESEARCH AND LIMITATIONS The model presented in this paper offers eight propositions exploring the factors that contribute to a successful HRIS implementation in a small-size restaurant chain. In total, six hypotheses were supported, one was partially supported, and one hypothesis was not supported. The presented model makes a signiﬁcant contribution to the literature by providing a framework for empirical testing to conﬁrm both the direction and the intensity of the proposed relationships. The present study collected information from decision makers in a smallsize restaurant chain with more than 400 restaurants. The results of the study are a collection of interview ﬁndings rather than quantitative analysis. One limitation of this study comes from the fact that the personal interview, as a qualitative research approach, took place in only one small-size restaurant chain. Due to research sample limitations, future research might consider conducting surveys with a larger sample of decision makers within

82

KHALDOON ‘‘KHAL’’ NUSAIR AND H. G. PARSA

the hospitality industry. This sample may consider the effect of the size of the business (small/medium/large), and the industry sector (hotel/restaurant) on effectiveness and efﬁciency of HRIS. Moreover, future research may also examine the role of other organizational variables in implementing HRIS. This can be extended to independent restaurants or major restaurant chains. This research offers an opportunity to expand on the cultural factors that inﬂuence a HRIS implementation. For example, investigating the relationship between technology trust and HRIS implementation success is of vital importance. Another avenue for future research is to ﬁnd relationship between length of user’s work experience in the same position and the satisfaction of HRIS implementation. Additionally, future research may test relationships between the number of HRIS applications and users’ satisfaction. Future research may also examine how the resistance in changing long-developed philosophies by certain managers can have an impact on the adoption of HRIS solutions. When ﬁrms are constrained by budget cuts, it is imperative to know how management prioritizes its HRIS investment decisions. Finally, investigating the challenges in integrating the HRIS element into a comprehensive enterprise resource planning (ERP) system is also of critical importance.

CONCLUSION HRIS is considered a strategic way to develop a new philosophy toward the way in which people are managed. Many decision-making strategies are based on HR analysis, which is used to determine whether current HR capabilities are congruent with the desired organizational objectives (Mayﬁeld et al., 2003). As such, the development of HRIS applications that cater to the needs of human resources is very important to the survival of hospitality ﬁrms. From a broader perspective, a HRIS yields a wellmanaged business with better informed employees. The implementation of HRIS applications results in two beneﬁts: (1) efﬁciency of operations and streamlined HR administration, (2) effectiveness when management can spend more time in decision-making and strategic planning, and less time on information input and day-to-day HR administration. In summary, this study has revealed the following: Small ﬁrms are capable of internally developing HRIS applications, but the help of external contractors and consultants is highly desirable.

Critical Factors in Implementing HRIS in Restaurant Chains

83

Inadequate ﬁnancial resources inhibit small ﬁrms from implementing various HRIS applications. HRIS adoption is largely correlated with top management support, commitment, and computer knowledge. Users with computer knowledge/experience play a major role in the successful implementation of HRIS. HRIS applications contribute signiﬁcantly to achieving the efﬁciency of the HR function in terms of: quick access to information, accuracy, and reducing the operating costs. HRIS applications contribute signiﬁcantly to achieving the effectiveness of the HR function in terms of making better human resource decisions. Considering the above ﬁndings, this study contributes to the body of academic knowledge by shedding more light into the factors that contribute to the implementation of HRIS programs and the beneﬁts of adoption. While HRIS grew in importance during the 1960s, a review of literature results in a dearth of research surrounding the decision factors that are considered during the adoption of a HRIS in a hospitality context. The present study collected information from decision makers regarding the factors that contribute to the decision whether to implement HRIS program. Therefore, the ﬁndings of this study open new avenues of research within the area of HRIS in hospitality.

ACKNOWLEDGMENT The authors would like to thank our industry partners for their generous contribution in this research. Condensed version of this paper was published elsewhere.

REFERENCES Antal, A. B., Diekes, M., & Hahner, K. (1997). Business perception of contextual changes: Sources and impediments to organizational learning. Business & Society, 36(4), 387–407. Ball, K. (2001). The use of human resource information systems: A survey. Personnel Review, 30(6), 677–693. Beckers, A., & Bsat, M. (2002). A DSS classiﬁcation model for research in human resource information systems. Information Systems Management, 19(3), 41–50. Boynton, A., Zmud, R., & Jacobs, G. (1994). The inﬂuence of IT management practice on IT use in large organizations. MIS Quarterly, 18(3), 299–318.

84

KHALDOON ‘‘KHAL’’ NUSAIR AND H. G. PARSA

Broderick, R., & Boudreau, J. (1992). Human resource management, information technology and the competitive edge. Academy of Management Executive, 6(2), 7–17. Brown, A. D., & Starkey, K. (1994). The effect of organizational culture on communication and information. Journal of Management Studies, 31(6), 807–828. Bruwer, P. (1984). A descriptive model of success for computer-based information systems. Information & Management, 7, 63–67. Cerveny, R. P., & Sanders, G. L. (1986). Implementation and structural variables. Information & Management, 11, 191–198. Cholak, P. M., & Simon, S. H. (1991). HRIS asks, ‘‘Who’s the boss?’’. Personnel Journal, 70(8), 74–76. Cohn, T., & Lindberg, R. A. (1972). How management is different in small companies. New York, NY: American Management Association, Inc. Cooley, P. L., Waltz, D. T., & Waltz, D. B. (1987). A research agenda for computers and small business. American Journal of Small Business, 11(4), 31–42. Delone, W. (1981). Firm size and the characteristics of computer use. MIS Quarterly, 5(4), 65–77. Desai, C., Wright, G., & Fletcher, K. (1998). Barriers to successful implementation of database marketing: A cross-industry study. International Journal of Information Management, 18(4), 265–276. Doll, W. (1985). Avenues for top management involvement in successful MIS development. MIS Quarterly, 9(1), 17–35. Ein-Dor, P., & Segev, E. (1978). Organizational context and the success of management information systems. Management Science, 24(10), 1067–1077. Exclusive IOMA Report. (2002a). Lack of money, staff, & time toughest part of managing HRIS. Human Resource Department Management Report, 2(12), 3. Exclusive IOMA Report. (2002b). How to leverage your HRIS during a budget crunch. Human Resource Department Management Report, 2(4), 5. Fein, S. (2001). Preface. In: A. J. Walker (Ed.), Web-based Human Resources. New York, NY: McGraw-Hill. Gomez-Meija, L., & Cardy, R. L. (2001). Managing Human Resources. Englewood Cliffs, NJ: Prentice-Hall. Hagwood, W., & Friedman, L. (2002). Using the balanced scorecard to measure the performance of your HR information system. Public Personnel Management, 31(4), 543–557. Haines, V., & Petit, A. (1997). Conditions for successful human resource information systems. Human Resource Management, 36(2), 261–275. Hall, L., & Torrington, D. (1998). Letting go or holding on – the devolution of operational personnel activities. Human Resource Management Journal, 8(1), 41–55. Hendrickson, A. (2003). Human resource information systems: Backbone technology of contemporary human resources. Journal of Labor Research, 24(3), 381–394. Igbaria, M., & Nachman, S. A. (1990). Correlates of user satisfaction with end user computing: An exploratory study. Information & Management, 19(2), 73–82. Igbaria, M., & Parasuraman, J. (1989). A path analytic study of individual characteristics, computer anxiety and attitudes toward computers. Journal of Management, 15(3), 373–388. Ivancevich, J. (1998). Human Resource Management (7th ed.). Boston, MA: McGraw-Hill. Kavanaugh, M., Gueutal, H., & Tannenbaum, S. (1990). Human resource information systems: Development and application. Boston, MA: PWS-Kent Publishing.

Critical Factors in Implementing HRIS in Restaurant Chains

85

Keen, P., & Morton, S. (1978). Decision support systems: An organizational perspective. Reading, MA: Addison-Wesley. Keil, M., Cule, P., Lyytinen, K., & Schmidt, R. (1998). A framework for identifying software project risks. Communications of the ACM, 41(11), 76–83. Kinnie, N. J., & Arthurs, A. J. (1996). Personnel specialists’ advanced use of information technology: Evidence and explanations. Personnel Review, 25(3), 3–19. Kossek, E., Young, W., Gash, D., & Nichol, V. (1994). Waiting for innovation in the human resource department: Godot implements a human resource information system. Human Resource Management, 33(1), 135–159. Kovach, K., & Cathcart, C. (1999). Human resource information systems (HRIS): Providing business with rapid data access, information exchange and strategic advantage. Public Personnel Management, 28(2), 275–281. Kovach, K., Hughes, A., Fagan, P., & Maggitti, P. (2002). Administrative and strategic advantages of HRIS. Employment Relations Today, 29(2), 43–48. Lederer, A. (1984). Planning and developing a human resource information system. The Personnel Administrator, 29(8), 27–39. Lopez, A. (1981). Computer literacy for teachers: High school and university cooperation. Educational Technology, 21, 15–18. Markland, R. E. (1972). Can computers help the small businessman? Journal of Systems Management, 23(4), 27–30. Martinsons, M. G. (1994). Benchmarking human resource information systems in Canada and Hong Kong. Information and Management, 26, 305–316. Martinsons, M. G. (1996). Human resource management applications of knowledge based systems. International Journal of Information Management, 26, 305–316. Mayﬁeld, M., Mayﬁeld, J., & Lunce, S. (2003). Human resource information systems: A review and model development. Advances in Competitiveness Research, 11(1), 139–152. Ngai, E., & Wat, F. (2004). Human resource information systems: A review and empirical analysis. Personnel Review, 35(3), 97–314. Patterson, M., West, M., Lawthom, R., & Nickell, S. (1997). Impact of people management practices on business performance. London, UK: Institute of Personnel and Development. Raymond, L. (1985). Organizational characteristics and MIS success in the context of small business. MIS Quarterly, 9(1), 31–52. Raymond, L., & Magnenat-Thalmann, N. (1982). Information systems in small business: Are they used in managerial decisions? American Journal of Small Business, 6(4), 20–23. Rosser, B. (2001). How to economically justify an IT investment, Gartner Reports. Ruppel, C., & Harrington, S. (2001). The relationship of communication, ethical work climate, and trust to commitment and innovation. Journal of Business Ethics, 25(4), 313–328. Sadri, J., & Chatterjee, V. (2003). Building organizational character through HRIS. International Journal of Human Resources Development and Management, 3(1), 84–98. Schein, H. (1994). Cultures in organizations: Three perspectives. Administrative Science Quarterly, 39(2), 339–342. Schuler, R. (2000). The internationalization of human resource management. Journal of International Management, 6(3), 239–260. Simon, S., & Werner, J. (1996). Computer training through behavior modeling, self-paced, and instructional approaches: A ﬁeld experiment. Journal of Applied Psychology, 81(6), 648–659.

86

KHALDOON ‘‘KHAL’’ NUSAIR AND H. G. PARSA

Solomon, S. (1986). Small business USA: The role of small enterprises in sparking America’s economic transformation. New York, NY: Crown Publisher. Stevens, L. (1993). Resume scanning simpliﬁes tracking. Personnel Journal, 72(4), 77–79. Tang, S., Yeunig, F., & Edmund, S. (1987). A study of the use of computer in human resource management in Hong Kong. Hong Kong: Hong Kong Baptist College. Tannenbaum, S. (1990). HRIS: User group implications. Journal of Systems Management, 41(1), 27–32. Tansley, C., Newell, S., & Williams, H. (2001). Effecting HRM-style practices through an integrated human resource information system. Personnel Review, 30(3), 351–371. Tansley, C., & Watson, T. (2000). Strategic exchange in the development of human resource information systems. New Technology, Work and Employment, 15(2), 108–122. Thaler-Carter, R. (1998). The HRIS in small companies: Tips for weighing the options. HR Magazine, 43(8), 30–35. Ulrich, D. (1997). Human Resources Champions. Boston, MA: Harvard Business School Press. Watson Wyatt Worldwide. (2002). eHR: Getting results along the journey. Retrieved July 7, 2005, from http://www.watsonwyatt.com/research/printable.asp?id=W-524. Yeung, A., & Brockbank, W. (1995). Reengineering HR through information technology. Human Resource Planning, 18(2), 111–123. Zammuto, R., & O’Connor, E. (1992). Gaining advanced manufacturing technologies beneﬁts: The roles of organization design and culture. Academy of Management Review, 17(4), 701–728.

THEME PARK VISITORS’ RESPONSES TO THE SARS OUTBREAK IN TAIWAN Hsin-You Chuo ABSTRACT The purpose of this study is to examine empirically different characteristics between theme park visitors who did and did not visit theme parks during the SARS outbreak period in Taiwan. The data consisting of 1,255 respondents were obtained from visitors to the five leading theme parks. Discriminant analysis was used to analyze respondents’ characteristics such as age, benefit sought, product involvement, and risk perception to examine significant differences between the two categories of respondents. Results of this study showed that younger or more frequent visitors more likely continued to visit theme parks during the SARS outbreak. Besides, visitors who continued to visit theme parks perceived greater infectious risk than those who did not visit theme parks during the SARS outbreak.

INTRODUCTION Severe acute respiratory syndrome (SARS), caused by the previously unrecognized coronavirus (SARS-CoV), is a highly contagious febrile respiratory illness and also associated with a high mortality rate. It is the ﬁrst severe and readily transmissible new disease to emerge in the 21st century. Dr. Carl Urbani, a Advances in Hospitality and Leisure, Volume 3, 87–104 Copyright r 2007 by Elsevier Ltd. All rights of reproduction in any form reserved ISSN: 1745-3542/doi:10.1016/S1745-3542(06)03006-2

87

88

HSIN-YOU CHUO

World Health Organization (WHO) epidemiologist working in Vietnam, submitted a report to the WTO, an afﬁliation of the United Nations, and identiﬁed/named this unknown disease ‘‘SARS’’ initially in March for the cases with the onset in February of 2003 (WHO, 2003a), however, the health authority in China named the disease ‘‘atypical pneumonia’’ (or feidian, the shortened version of its full Chinese name) instead (Wang, 2004). The ﬁrst cases of SARS are now known to have emerged in mid-November 2002 in Guangdong Province, China. On February 21, 2003, an infected medical doctor (Dr. Liu) left Guangdong Province and visited Hong Kong for attending a wedding reception. Dr. Liu stayed at the Metropole Hotel in Hong Kong and infected a number of tourists from several parts of the world (WHO, 2003b). Subsequently, the disease began spreading around the world along international air travel routes. A few days later, hospitals in Hong Kong, Vietnam, and Singapore began reporting cases. By late February 2003, SARS was considered an emerging disease (WHO, 2003a). From SARS’ appearance in November 2002 to July 11, 2003, when the WHO declared that owing to the outbreak more than 8,400 individuals were infected by and 813 victims died from the disease (WHO, 2003c). Most SARS cases have occurred in Mainland China, Hong Kong, Taiwan, and Canada. Mainland China reported the largest number of SARS infections (5,327) and deaths (348), followed by Hong Kong (1,755; 298) and Taiwan (671; 84) (CDC, 2003; WHO, 2003c). Consequently, SARS caused considerable social disruption and public anxiety, even in area well beyond the outbreak sites (WHO, 2003d). In terms of the number of SARS infections and deaths, the severity of the outbreak might seem to be overstated and people’s responses might look like over-reacting. In contrast to tuberculosis (15,000 people infected and 1,500 dead per year), or car accidents (35,000 people injured and 680 killed in the ﬁrst 3 months of 2003), SARS killed ‘‘only’’ 84 patients in Taiwan (Chen, Jang, & Kim, 2007). Accordingly, some scholars (e.g., Chen et al., 2007; McKercher & Chon, 2004) point out that people were over-reacting to the SARS epidemic and tourism suffered unnecessary damage. However, it seems more interesting and necessary to realize factors out of the cumulative number of fatal cases that caused an enormous panic – which subsequently resulted in the over-reactions. A Nationwide Panic Caused in Taiwan The SARS epidemic has been characterized by its rapid spread. Hsieh, Chen, and Hsu (2004) synthesize ofﬁcial reports and describe the rapid

Theme Park Visitors’ Responses to the SARS Outbreak in Taiwan

89

spread of the SARS outbreak in Taiwan in detail. The WHO reported 3,947 probable SARS cases with 229 deaths worldwide on April 22, 2003; China, Hong Kong, Singapore, Vietnam, and Toronto, Canada, had the most cases. Taiwan, meanwhile, had 29 probable cases and no deaths. Seventyeight percent of the cases were imported. The growth of the numbers of SARS infections seemed to be a typical minor outbreak at that time. On that day, a new cluster of seven infections in Hoping Hospital in Taipei was reported and it started a chain of local transmissions that cumulated in 116 probable cases and 10 deaths in the following two weeks. By mid-May, the numbers grew to 264 probable cases and 34 deaths. Subsequently, by June 1, it expanded into 680 probable cases and 81 deaths. In a period of less than one month, more than a sixfold increase in the numbers of SARS infections and victims was erupted rapidly in Taiwan. The rapid increase rates of reported probable SARS case-patients and deaths undoubtedly would cause a panic nationwide in Taiwan. In addition to the rapid increase rate of reported probable SARS casepatients, the nationwide panic in Taiwan might also be resulted from a sense of the endless and uncontrolled expansion of the outbreak. As the disease was spreading so rapidly, the health authority in Taiwan enforced many stringent measures in order to contain the outbreak. In addition to thermal scanning arrivals from abroad to check for signs of fever induced by SARS, Hsieh et al. (2004) indicate two of the most important stressed measures. One measure was reporting, admitting, and hospitalizing all susceptible patients. The other was the house quarantine of people either those with contacts to the suspected case-patients or arrivals from the affected areas abroad. However, on the ﬁrst hand, hospitals in Taiwan were initially unprepared for and unprotected from the SARS disease. The patient quarantine rooms, personal protective equipments for health care workers, and general infection control, etc., which had been improved and well prepared professionally later (Esswein et al., 2004), were relatively insufﬁcient at the beginning of the outbreak. Since frequent unprotected or inadequately protected patient-to-health care worker interactions and grouping large numbers of ill persons can greatly amplify intrahospital transmission (Gopalakrishna et al., 2004), almost 73 percent of all traceable infections in Taiwan occurred in hospital settings (Hsieh et al., 2004). It caused inevitably a panic among all medical professions on the frontline in the battle against SARS. On the other hand, the home quarantine of a number of susceptible people was frequently broken (Hsieh et al., 2004). Just as the acquired immune deﬁciency syndrome (AIDS), it cannot be considered quarantineable not only because of medical but also because of ethical and

90

HSIN-YOU CHUO

legal issues (Gensini, Yacoub, & Conti, 2004). Accordingly, a sense of uncontrollability was emerged publicly at the beginning of the SARS outbreak. Furthermore, the local sensationalist media accelerated and ampliﬁed the resulted panic from the sense of uncontrollability successfully by focusing their attention on some intrahospital transmission and out-of-supervised quarantine cases. This phenomenon was consistent with Mason, Grabowski, and Du’s (2005, p. 17) description of the global media that the media were much less interested in providing accurate information and more concerned with selling copies of their publication through sensationalist but inaccurate stories. Aside from the domestic factors, i.e., the rapid increase rate of SARSinfected cases and a sense of out-of-control, it should be noted that there was an international factor as well. The international factor played a signiﬁcant role in the enforcement of not only a nationwide panic in Taiwan but also a worldwide panic to the SARS epidemic.

A Worldwide Panic and the WHO-Prompted Travel Recommendations In order to minimize the global spread of SARS, the WHO issued a series of speciﬁc travel advisories – recommending travelers to postpone all but essential travel to designated areas where the risk of exposure to SARS was considered high – against Hong Kong, China, Toronto, and Taiwan, respectively from April 2 to May 17 and especially a ‘‘general travel advisory’’ to potential travelers on March 15, 2003 (WHO, 2003d). The travel advisories did trigger a chain reaction of public anxiety even in areas well beyond the outbreak sites. The announcements were unprecedented in the WHO’s almost 45-year history, for this was the ﬁrst time that the organization had issued advisories for speciﬁc geographical areas due to an outbreak of an epidemic (WTTC, 2003). Although the recommendations were respectively removed by the WHO from all the designated areas to which they had applied as the SARS outbreak was successfully curtailed in late June, the hospitality and tourism industry in Asia had been severely hit by the outbreak of the SARS epidemic. While it must be praised for the WHO’s substantial actions in controlling the SARS outbreak, strong criticism from authorities of the ‘‘off-limits’’ areas, tourism industry, and scholars was directed at the organization. McKercher and Chon (2004) indicate that the WHO’s travel advisories criticism was instrumental in triggering the almost complete eradication of tourism in Asia. Based on the costs of canceled travel and decreased

Theme Park Visitors’ Responses to the SARS Outbreak in Taiwan

91

investment in Asia, the economic costs have been estimated ranging from US$30,000 million to US$140,000 (WHO, 2003d). It is even estimated to produce costs that might rival the Asian Financial Crisis of the mid-1990s (de Lisle, 2004). Lakshmanan (2003) (as cited by McKercher & Chon, 2004) well describes the very unusual feature of the SARS outbreak by a statement that ‘‘a panic spread faster than the disease itself.’’ Most likely, it was partly contributed by the participation of the global media as a role of accelerators and ampliﬁers in the spread of the worldwide panic. Since the WHO publicized its message about SARS and travel warning by using the global media, however, it could not write word-for-word the article or website commentary, the organization could hardly control the tone or precise nature of any media communication. Accordingly, Mason et al. (2005) point out that the way the WHO’s global health alert was reported by the world’s media is also likely to have contributed to the feeling of worldwide panic.

SARS Might Recur Tourism industry is still threatened by the possibility of the recurrence of the infectious disease since the WHO has warned that SARS might recur. Besides, there will be new biological threats whether SARS reappears or not. Therefore, during the post-outbreak period, one of the most signiﬁcant recovery efforts that marketing managers in the tourism industry can make is to know what kind of customers continued to patronize their services during the outbreak period. From customers’ different patronage decisions in response to the SARS outbreak, they can learn valuable lessons and develop a plague survival strategy for possible emerging epidemic outbreaks in the future. Particularly, if customers who continued to patronize a hospitality/ tourism service during the SARS outbreak can be distinguished and identiﬁed from those who did not, marketing managers may be able to increase their efforts to attract the most potential customers in case the SARS or similar biological crises emerge someday.

Related Research on Crisis Management Drawing on insights from crisis management literature, not only the proactive, strategic, holistic approaches to the issue of crises have been proposed and discussed (e.g., Ritchie, 2004), but generic or speciﬁc models for

92

HSIN-YOU CHUO

analyzing and developing management strategies have also been proposed (e.g., Faulkner, 2001; Huang & Min, 2002). Aside from the underlying efforts, various crisis cases have been explored, investigated, analyzed, and discussed. Chen (2000) examined Asian outbound travelers’ consumption patterns after the 1997 Asian economic crisis and provided marketing strategies for international tourism practitioners. Blake and Sinclair (2003) examined policy responses to the September 11 terrorist attacks in the United States and suggested some ways of handling the situation to policymakers. Page, Yeoman, Munro, Connell, & Walker (2006) illustrated complex issues associated with a ﬂu pandemic qualitatively via a case study of scenario planning exercise. To the impacts of the SARS outbreak, a number of researchers devoted efforts to the formulation of proactive and recovery management in the tourism industry. While some (e.g., Chen et al., 2007; Dombey, 2003; McKercher & Chon, 2004; Pine & McKercher, 2004) revealed the impacts of the SARS effects on diverse aspects of the managerial functions, on various sectors of the industry, and/or on different geographical areas, some others (e.g., Chien & Law, 2003; Henderson & Ng, 2004; Tse, So, & Sin, 2006) suggested substantial processes to set up contingency and recovery arrangements for hotel and restaurant management speciﬁcally. Purpose of Study The purpose of this study is to examine empirically different characteristics between theme park visitors who did and did not visit theme parks during the SARS outbreak period in Taiwan. Signiﬁcant differences between the two categories of respondents on their characteristics such as age, patronage frequency in the last year, beneﬁt sought, product involvement, and risk perception were examined. Accordingly, the following four research questions were developed: 1. Can a signiﬁcant discriminant function be developed to interpret the differences between respondents who did and did not visit theme parks during the SARS outbreak period in Taiwan on the basis of their personal characteristics? 2. Which characteristics contribute to most of the inter-group differences? 3. How accurately can respondents be classiﬁed into the two categories by the developed discriminant function? 4. What marketing implications can be derived from theme park visitors’ different patronage decisions in response to the SARS outbreak?

Theme Park Visitors’ Responses to the SARS Outbreak in Taiwan

93

METHODOLOGY Sampling Design The target population for this study was visitors to the ﬁve leading theme parks in Taiwan (i.e., Jenfusan, Leofoo, Yamay, Formosan Aboriginal Culture Village, and Window on China). Quota sampling technique was employed to select elements of the research sample from the sampling population based on the ofﬁcial report (Tourism Bureau, 2003) on annual attendance to domestic theme parks in Taiwan in 2002. In order to minimize respondents’ recall errors, the ﬁeld survey for data collection was conducted during the period between June 25 and July 2 in 2003 since the WHO extended its travel recommendation to include Taiwan on May 8 and removed it from the list of postpone-travel areas on June 17. Junior students from a local university were trained as interviewers for data collection. Interviewers stationed near the exit gates of the ﬁve parks invited departing visitors to participate in this study. All subjects were selected based on their willingness to volunteer their personal information on site.

Research Instrument A structured-undisguised questionnaire was developed for data collection. In addition to the information of respondents’ general demographics, their patronage frequency in the last year and whether they visited theme parks in the period of the SARS outbreak, the question content also consisted of scale items to measure ‘‘beneﬁt sought,’’ ‘‘product involvement,’’ and ‘‘risk perception.’’ Ten individual beneﬁt scale items were derived from Pearce’s (1993) Leisure Ladder Model for theme park visitors. Respondents were asked to rate each of the beneﬁt items from ‘‘0’’ to ‘‘100’’ to indicate the extent to which the beneﬁt motivated them to make the current visits. In the speciﬁc interests of this study, McQuarrie and Munson’s (1992) eight scale items for the measurement of consumers’ ‘‘enduring involvement’’ with a product were modiﬁed to measure respondents’ product involvement with theme parks in this study. The ‘‘many factors’’ described in the seventh scale item ‘‘I usually take many factors into account before purchasing this product’’ were replaced by ‘‘admission fee’’ and ‘‘the distance a theme park is from my home,’’ respectively. As a result, nine involvement measure items with a ﬁve-point Likert scale were designed in the questionnaire. Finally, respondents were asked to subjectively estimate the probability a person will be infected with

94

HSIN-YOU CHUO

SARS in each of the three given scenarios, respectively. The given scenarios were: (1) right now in the theme parks which they had just departed from; (2) participating in outdoor recreational activities if the WHO should again extend its postpone-travel recommendation to include Taiwan; and (3) visiting a theme park in the same period of time described in the second scenario. Respondents were asked to rate the SARS-infected possibility in each of the scenarios in terms of percentage (from ‘‘0’’ to ‘‘100’’).

Data Analysis In order to develop a meaningful discriminant function, possible correlations between respondents’ personal characteristics had to be avoided or eliminated ﬁrst. Accordingly, variables representing each of the respondents’ personal characteristics were condensed into factors by the technique of principal components analysis. Internal consistency reliability of the variables contained in each of the factors was assessed. A value of Cronbach’s alpha coefﬁcient greater than .6 generally indicates satisfactory internal consistency reliability (Malhotra, 1999). Mean of respondents’ ratings to consistent variables contained in each of the factors served as the input score of the factor in the process of discriminant analysis. Thus, on the one hand, whether or not the respondents visited theme parks during the SARS outbreak was adopted to be the dependant (criterion) variable; on the other, respondents’ age, their patronage frequency in the last year, and the factors condensed from scale items of respondents’ risk perception, beneﬁt sought, and product involvement were adopted to be the independent variables (predictors) in the developing discriminant function. The signiﬁcance and validity of the function were assessed based on Wilks’ l test and the percentage of cases correctly classiﬁed, respectively. SPSS 10 was utilized for data processing and the level of signiﬁcance of .05 was accepted for all statistic tests in this study.

RESULTS By using quota sampling technique, a research sample consisting of 1,255 respondents was obtained from visitors to the ﬁve leading theme parks. Table 1 shows that the distribution patterns of the respondents’ demographics were consistent with the practical observation of theme park visitors’ characteristics in the real world. Respondents’ age ranged from 11 to 51

Theme Park Visitors’ Responses to the SARS Outbreak in Taiwan

Table 1. Variables Age

95

Proﬁles of the Research Sample. Levels

Frequency

%

Under 15 15–19 20–24 25–29 Above 30 Missing

2 245 592 211 204 1

0.2 19.5 47.2 16.8 16.2 0.1

620 632 0.3

49.4 50.4 0.2

Gender

Male Female Missing

Marital

Single Married Missing

1,018 223 14

Sampling parks

Jenfusan Leofoo Yamay FACV WOC

410 379 208 129 129

81.1 17.8 1.1 32.67 30.20 16.57 10.28 10.28

years, with the mean age of 23.84 years (S.D. ¼ 6.55). They had been to the ﬁve theme parks ranging from 0 to 110 times and for an average of 1.65 times (S.D. ¼ 5.78) in the last year. The correlation matrices of the beneﬁt and involvement scale items in the procedure of principal components analysis were examined by Bartlett’s test of sphericity. To the beneﬁt scale items, the approximate w2 statistic was 3882.626 with 45 degrees of freedom, which is of .000 signiﬁcance. Besides, the value of the KMO statistic (.871) was also large (>.5). To the involvement scale items, the approximate w2 statistic was 2653.538 with 36 degrees of freedom, which is also of .000 signiﬁcance and the value of the KMO statistic was .808. Therefore, the procedure of principal components analysis was considered an appropriate technique for analyzing the data in this study. In order to differentiate between the two categories of respondents, a discriminant function was developed in this study. At ﬁrst, seven independent variables for the subsequent discriminant analysis were identiﬁed through the analytical procedures of principal components analysis and Cronbach’s alpha test. Tables 2 and 3 show the results of principal components analysis. Ten beneﬁt scale items and nine involvement scale items were condensed into two beneﬁt factors and two involvement factors,

96

Table 2.

HSIN-YOU CHUO

Results of Principal Components Analysis to the Beneﬁt Scale Items.

Beneﬁt Scale Item

Mean (S.D.)

Self-esteem Totally involved in the setting Self-development Spiritual and peaceful feeling Experiencing the unusual and novel Enjoying a sense of escape The fun and thrill of rides Restoration Friendship Family togetherness Variance explained (50.804%) Eigenvalue Cronbach’s alpha

60.81 65.37 57.73 53.94 70.69 67.23 77.56 76.12 82.44 72.09

(29.50) (25.08) (27.40) (30.99) (24.06) (25.37) (23.62) (19.63) (20.46) (28.18)

Factor 1 Loadings

Factor 2 Loadings

0.772 0.771 0.760 0.713 0.704 0.648 0.563 0.521 0.280 0.043 38.599% 3.860 0.8421

0.092 0.135 0.173 0.307 0.029 0.252 0.103 0.237 0.032 0.968 12.204% 1.220

Table 3. Results of Principal Components Analysis to the Involvement Scale Items. Involvement Scale Item I usually pay attention to ads for theme parks I would read Consumer Reports articles about TPs I have compared product characteristics among TPs I usually talk about TPs with other people I would be interested in reading about TPs I usually spend lots of time deciding which TPs to visit I usually take distance into account before patronage I usually take admission into account before patronage I usually seek advice from others before patronage Variance explained (51.955%) Eigenvalue Cronbach’s alpha

Mean (S.D.)

Factor 1 Loadings

Factor 2 Loadings

3.54 (0.86)

0.758

0.062

3.46 (0.87)

0.738

0.183

3.34 (0.90)

0.726

0.010

3.75 (0.86)

0.697

0.186

3.62 (0.83)

0.641

0.264

3.35 (0.89)

0.384

0.359

3.73 (0.96)

0.004

0.829

4.01 (0.90)

0.115

0.795

3.84 (0.85)

0.282

0.551

30.928% 2.783 0.7751

21.027% 1.892 0.6297

Theme Park Visitors’ Responses to the SARS Outbreak in Taiwan

97

respectively. The values of the resultant Cronbach’s alpha coefﬁcient for Beneﬁt Factor 1 (B1), Involvement Factor 1 (I1), and Involvement Factor 2 (I2) were .8421, .7751, and .6297, respectively. No internal consistency problem could be found in Beneﬁt Factor 2 (B2) since it was represented by the sole contained variable ‘‘family togetherness.’’ A variable representing the respondents’ risk perception (R) was summated by the three measures (Cronbach’s alpha ¼ .8618) of respondents’ self-perceived SARS-infected possibilities in the three given scenarios. In sum, seven independent variables [i.e., the respondents’ age (A), their patronage frequency in the last year (F), B1, B2, I1, I2, and R] were examined to ensure satisfactory internal consistency reliability and then accepted into the discriminant analysis. As a result, the developed standard canonical discriminant function was: Di ¼ 0:717Ai þ 0:653Fi þ 0:289Ri þ 0:211I1i þ 0:067B2i þ 0:059B1i þ 0:018I2i where if Di>.0285, classify individual i as belonging to ‘‘visitors who did visit theme parks during the SARS outbreak’’; otherwise classify individual i as belonging to the other category. The eigenvalue associated with this function is .033, and it accounts for 100 percent of the explained variance. The canonical correlation associated with this function is .179. It indicates that the variance in the dependent variable is not largely explained by this model. However, the Wilks’ l associated with the function is .968, which transforms to a w2 of 40.419 with 7 degrees of freedom. This is signiﬁcant beyond the .05 level. In other words, the discriminant function is statistically signiﬁcant. Therefore, it is meaningful to interpret the results of the discriminant analysis. Table 4 shows the primary results of the discriminant analysis. The signiﬁcance of the univariate F ratios indicates that when the independent variables are considered individually, only the respondents’ age, their patronage frequency, and risk perception were signiﬁcant predictors in discriminating between the groups. Besides, the pooled within-groups correlation matrix indicates low correlations between the independent variables. In this case, multicollinearity was unlikely to be a problem. Given low intercorrelations between the independent variables in Table 4, independent variables with relatively large standardized coefﬁcients contribute more to the discriminating power of the function, as compared with independent variables with smaller coefﬁcients. Therefore, respondents’ age and their patronage frequency in the last year contribute to most, while respondents’ risk perception also contributes to some, of the inter-group

98

HSIN-YOU CHUO

Table 4. Results of Discriminant Analysis. Age Group means Yes No Total

visited 22.9449 24.4972 23.8398

Frequency

Risk

Beneﬁt 1 Beneﬁt 2 Involve 1 Involve 2

2.4030 1.0880 1.6449

32.0862 29.3885 30.5310

68.2300 67.7033 67.9264

71.6179 72.4749 72.1119

3.5317 3.4912 3.5083

3.8599 3.8534 3.8561

Group standard deviations Yes 6.2077 8.2479 No 6.7109 2.7173 Total 6.5451 5.7841

23.2381 22.7338 22.9781

16.5124 17.1701 16.8899

27.5394 28.6187 28.1586

0.5962 0.5978 0.5972

0.6645 0.7019 0.6860

1.000 0.245 0.099 0.023

1.000 0.058 0.004

1.000 0.375

1.000

Pooled within-groups correlation matrix Age 1.000 Frequency 0.056 1.000 Risk 0.046 0.016 1.000 Beneﬁt 1 0.059 0.120 0.087 Beneﬁt 2 0.219 0.066 0.084 Involve1 0.158 0.115 0.015 Involve2 0.063 0.038 0.001

Wilks’ l and univariate F ratio with 1 and 1,240 degrees of freedom Variable Wilks’ l F Signiﬁcance Age 0.986 17.281 0.000 Frequency 0.987 15.862 0.000 Risk 0.997 4.190 0.041 Beneﬁt 1 1.000 0.295 0.587 Beneﬁt 2 1.000 0.281 0.596 Involve1 0.999 1.397 0.237 Involve2 1.000 0.028 0.867

differences. The signs of the coefﬁcients associated with the signiﬁcant predictors suggest that younger age and more experience in visiting theme parks were more likely to result in the respondents visiting theme parks during the SARS outbreak. Meanwhile, individuals who visited theme parks during the SARS outbreak were also associated with higher risk perception. Table 5 shows the classiﬁcation results based on the developed discriminant function. The percentage of cases correctly classiﬁed is 61.2 percent. The function seems to be of deﬁcient validity if one expects the function to distinguish individuals who had been to theme parks during the SARS outbreak from those who had not, since the predictability of the function is only 11 percent greater than that obtained by chance (i.e., 1/2 ¼ .50 or 50 percent).

Theme Park Visitors’ Responses to the SARS Outbreak in Taiwan

99

Table 5. Correctness and Predictability of the Classiﬁcation Results in the Discriminant Analysis. Actual Group

Did visit Did not visit

Number of Cases

526 716

Predicted Group Membership Did Visit

Did Not Visit

90 (17.1%) 46 (6.4%)

436 (82.9%) 670 (93.6%)

Notes: 1. Percent of grouped cases correctly classiﬁed: 61.2%. 2. Thirteen cases with missing values were excluded from the analysis.

FINDINGS AND DISCUSSIONS Generally speaking, in this study, a statistically signiﬁcant discriminant function was successfully developed to interpret the differences between respondents who did and did not visit theme parks during the SARS outbreak period in Taiwan on the basis of their personal characteristics. Among the seven adopted characteristics, respondents’ age and their patronage frequency in the last year contributed to most of the inter-group differences. Moreover, individuals who visited theme parks during the SARS outbreak were also associated with higher risk perception. Substantial marketing implications can be explored based on the results of the discriminant analysis, although the function seems to be of deﬁcient validity in terms of predictability. First of all, in case the SARS or similar biological crises emerge in the future, younger and/or frequent consumers should be the focused targets of theme park managers’ primary marketing efforts because they are more likely to continue to visit theme parks during the period of epidemic outbreak. Accordingly, a plague survival strategy can be developed with the goal of attracting consumers from the targets. Since the beneﬁts sought by theme park visitors played only a trivial role in their patronage decisions during the SARS outbreak, contents of the promotion projects may not be associated with or restricted to particular beneﬁts of visiting theme parks. Instead, a series of sales promotions, such as special promotional prices for the admission of large teen groups, cross-promotions with ﬁrms providing other products or services to young consumers, or discounted season passes for potential heavy-users, may help theme parks survive the period of epidemic outbreak. One of the results of this study indicates that individuals who continued visiting theme parks during the SARS outbreak were associated with higher

100

HSIN-YOU CHUO

risk perception in comparison with those who did not visit theme parks. It is interesting to note that Grobe and Douthitt (1995) also obtained similar ﬁndings from their research regarding milk consumers’ risk perception of the recombinant (synthetic) bovine growth hormone (rbGH). Their ﬁndings indicated that consumers who purchase more milk perceive a greater risk than those who purchase less (p. 141). However, they did not explain the ﬁndings of their research. In fact, the theme park visitors’ continued patronage or the milk purchasers’ greater consumption resulted in, rather than resulted from, their greater risk perception. In detail, the consistent theme park patronage during the SARS outbreak and milk consumption under the purchasers’ psychological resistance to the rbGH injection seem to be caused by individuals’ relatively inelastic demands for theme parks or milk. In order to build lasting customer relationships, managers should compensate the customers with inelastic demands for their consistent patronage rather than take advantage of them since there are usually a couple of brands or selections for a particular product. Therefore, in case the SARS or similar biological crises emerge in the future, the present seems to be the perfect time to build up a valuable database consisting of the customers with inelastic demands for particular hospitality and tourism services. Thus, service providers may continuously beneﬁt from the database. The ﬁnding that visitors’ risk perception of the SARS infection did not largely contribute to their patronage decisions during the SARS outbreak provides indirect evidence that theme park visitors’ ‘‘risk attitude’’ dominated their ‘‘risk perception’’ in their risk response behavior to the SARS epidemic. Pennings, Wansink, and Meulenberg (2002) proposed that the behavior of consumers in a crisis situation can be explained by a combination of risk perception and risk attitude. Whereas risk attitude deals with consumers’ interpretation of the content of the risk, the seriousness of adverse consequences, or the extent of risk aversion toward a particular crisis, risk perception instead deals with consumers’ interpretation of the chance of being exposed to the content of the risk. Since individuals with greater risk perception were the ones who continued to visit theme parks while those with lower risk perception tended to avoid the patronage, risk perception does not seem to be the dominant motivator of theme park visitors. Suppose that risk attitude is the true motivator behind theme park visitors’ responses to the SARS outbreak. In such a case, Pennings et al. suggest that even if the probabilities of being exposed to the risk are small, effectively communicating these probabilities will have little inﬂuence on consumer behavior. Instead, marketers will have to focus on ways to eliminate the risk. Chien and Law (2003) suggested substantial processes to minimize hotel employees

Theme Park Visitors’ Responses to the SARS Outbreak in Taiwan

101

and guests’ possibility of SARS infection and to contain the potential spread of viruses on the hotel property. The processes can also be well utilized by other businesses or services in the hospitality and tourism industry. In addition to actually implementing the processes of risk elimination, it is equally important that management should make efforts to let the potential consumers know and let the customers see, smell, hear, and feel the processes of risk elimination on the property. Based on the ﬁndings and limitations of this study, several recommendations for further research can be drawn. First, the roles that both risk perception and risk attitude play in people’s responses to severe epidemics or similar biological crises can be further explored. Extended from the existing related literature, the following research might be expected to establish a theoretical model – consisting risk perception, risk attitude, and other signiﬁcant variables – of people’s responses to disease outbreaks. Second, although the signiﬁcant role of the media in the SARS outbreak has been well discussed in Mason et al. (2005) in terms of the amount of media attention given to the outbreak along the ﬁve stages of Hall’s (2002) ‘‘issue-attention cycle,’’ given a strong averse risk attitude toward particular epidemics or pandemics, issues regarding how and what the media can communicate effectively to the public to have signiﬁcant inﬂuence on their responses to the disease outbreak can be further investigated by the following research. However, it might be even more important to know how to allure or encourage the media to cease rather than amplify social panic by the above approaches. The Singapore case – a well-trusted institute (e.g., tourist board) coordinates related media and tourism sectors to establish a taskforce and working with the national health authority to produce guidelines and to have a hold over the social panic – indicated in Henderson (2003) might not work applicably in elsewhere, however, it did provide a sample of possible domestic problem-solving mechanism. Based on the basic framework, a possible international cooperation mechanism might be further discussed and developed.

CONCLUSION It is clear that the international hospitality and tourism industry will always beneﬁt from researchers’ continuing efforts to confront any possible emerging industry crises in the future. The efforts provide effective suggestions to either the management practitioners or the public policymakers during and after a certain crisis emergence in the industry.

102

HSIN-YOU CHUO

This study reveals that younger or more frequent visitors more likely continued to visit theme parks during the SARS outbreak period. In addition to the substantial suggestions on possible adjustments of marketing mix, some implications can be emerged from the ﬁndings and discussion of this study. It should be ﬁrstly noted that, during a plague outbreak, the impact against tourism industry is primarily generated by the panic resulted from the plague rather than by the plague itself. The dominant determinant in the formulation of the plague-resulted panic tends to be the magnitude of people’s aversion (risk attitude) to the plague rather than the perceived possibility to be infected by the plague (risk perception). By the back-up of the media, the scale and spread of possible emerged panic tends to be ampliﬁed and accelerated extensively. If a panic has been prevailed, it might be an inevitable outcome that people tend to over-react in their responses to a plague outbreak. People’s over-reactions might be represented by decreasing the amount of consumption or even the collapse of regional tourism. According to the subsequence of a plague-outbreak crisis emerging from the discovery and identiﬁcation of an epidemic to possible damages suffered by tourism industry, several critical points between different stages of the crisis progression can be found. In terms of crisis management, if the critical points can be well monitored and managed, the situation will be substantially better off.

REFERENCES Blake, A., & Sinclair, M. T. (2003). Tourism crisis management: US response to September 11. Annals of Tourism Research, 30(4), 813–832. Centers for Disease Control and Prevention (CDC). (2003). Use of quarantine to prevent transmission of severe acute respiratory syndrome: Taiwan 2003. MMWR Morbidity Mortality Weekly Report, 52, 680–683. Chen, J. S. (2000). Examining Asian outbound travelers’ consumption patterns after the 1997 Asian economic crisis. Journal of Hospitality & Leisure Marketing, 7(3), 67–80. Chen, M.-H., Jang, S., & Kim, W. G. (2007). The impact of the SARS outbreak on Taiwanese hotel stock performance: An event-study approach. International Journal of Hospitality Management, 26(1), 200–212. Chien, G. C. L., & Law, R. (2003). The impact of the severe acute respiratory syndrome on hotels: A case study of Hong Kong. International Journal of Hospitality Management, 22(3), 327–332. de Lisle, J. (2004). Atypical pneumonia and ambivalent law and politics: SARS and the response to SARS in China. Temple Law Review, 77(2), 193–245. Dombey, O. (2003). The effects of SARS on the Chinese tourism industry. Journal of Vacation Marketing, 10(1), 4–10.

Theme Park Visitors’ Responses to the SARS Outbreak in Taiwan

103

Esswein, E. J., Kiefer, M., Wallingford, K., Burr, G., Lee, L. J.-H., Wang, J.-D., Wang, S. C., & Su, I.-J. (2004). Environmental and occupational health response to SARS, Taiwan, 2003. Emerging Infectious Diseases, 10(7), 1187–1194. Faulkner, B. (2001). Towards a framework for tourism disaster management. Tourism Management, 22(2), 135–147. Gensini, G. F., Yacoub, M. H., & Conti, A. A. (2004). The concept of quarantine in history: From plague to SARS. Journal of Infection, 49(4), 257–261. Gopalakrishna, G., Choo, P., Leo, Y. S., Tay, B. K., Lim, Y. T., Khan, A. S., & Tan, C. C. (2004). SARS transmission and hospital containment. Emerging Infectious Diseases, 10(3), 395–400. Grobe, D., & Douthitt, R. (1995). Consumer acceptance of recombinant bovine growth hormone: Interplay between beliefs and perceived risks. Journal of Consumer Affairs, 29(1), 128–143. Hall, C. M. (2002). Travel safety and the media: The signiﬁcance of the issue-attention cycle. Current Issues in Tourism, 5(3), 458–466. Henderson, J. C. (2003). Managing a health-related crisis: Severe acute respiratory syndrome (SARS) in Singapore. Journal of Vacation Marketing, 10(1), 67–78. Henderson, J. C., & Ng, A. (2004). Responding to crisis: Severe acute respiratory syndrome (SARS) and hotels in Singapore. International Journal of Tourism Research, 6(6), 411–419. Hsieh, Y.-H., Chen, C. W. S., & Hsu, S.-B. (2004). SARS outbreak, Taiwan, 2003. Emerging Infectious Diseases, 10(2), 201–206. Huang, J. H., & Min, J. C. H. (2002). Earthquake devastation and recovery in tourism: The Taiwan case. Tourism Management, 23(2), 145–154. Lakshmanan, I. (2003). Hong Kong’s fear of SARS spreading faster than the disease itself: 80% residents wearing surgical masks. Hotel-Online, from http://www.hotelonline.com/News/ PR2002_2nd/Apr03_SARSUpdate.html Malhotra, N. K. (1999). Marketing research: An applied orientation (3rd ed.). New Jersey: Prentice-Hall. Mason, P., Grabowski, P., & Du, W. (2005). Severe acute respiratory syndrome, tourism and the media. International Journal of Tourism Research, 7(1), 11–21. McKercher, B., & Chon, K. (2004). The over-reaction to SARS and the collapse of Asian tourism. Annals of Tourism Research, 31(3), 716–719. McQuarrie, E. F., & Munson, J. M. (1992). A revised product involvement inventory: Improved usability and validity. Diversity in Consumer Behavior: Advances in Consumer Research, 19, 108–115. Page, S., Yeoman, I., Munro, C., Connell, J., & Walker, L. (2006). A case study of best practice—visit Scotland’s prepared response to an inﬂuenza pandemic. Tourism Management, 27(3), 361–393. Pearce, P. L. (1993). Fundamentals of tourist motivation. In: D. G. Pearce, & R. W. Butler (Eds), Tourism research critiques and challenges (pp. 113–134). London: Routledge. Pennings, J. M. E., Wansink, B., & Meulenberg, M. T. G. (2002). A note on modeling consumer reactions to a crisis: The case of the mad cow disease. International Journal of Research in Marketing, 19(1), 91–100. Pine, P., & McKercher, B. (2004). The impact of SARS on Hong Kong’s tourism industry. International Journal of Contemporary Hospitality Management, 16(2), 139–143. Ritchie, B. (2004). Chaos, crises and disasters: A strategic approach to crisis management in the tourism industry. Tourism Management, 25(6), 669–683.

104

HSIN-YOU CHUO

Tourism Bureau. (2003). Report on tourism statistics. Taipei: Ministry of Transport and Communications. Tse, A. C. B., So, S., & Sin, L. (2006). Crisis management and recovery: How restaurants in Hong Kong responded to SARS. International Journal of Hospitality Management, 25(1), 3–11. Wang, R. (2004). China’s response to SARS. Temple Law Review, 77(2), 149–153. WHO. (2003a). Case definitions for surveillance of severe acute respiratory syndrome (SARS). Geneva: World Health Organization. Also retrieved: October 9, 2006, from http:// www.who.int/csr/sars/casedeﬁnition/en/ WHO. (2003b). Severe acute respiratory syndrome (SARS): Status of the outbreak and lessons for the immediate future. Geneva: World Health Organization. WHO. (2003c). Cumulative numbers of reported probable cases of SARS. Geneva: World Health Organization. Also retrieved: October 9, 2006, from http://www.who.int/csr/sars/country/ 2003_07_11/en/ WHO. (2003d). Severe acute respiratory syndrome (SARS): Report by the secretariat (Provisional agenda item 8.3, EB113/33). Geneva: World Health Organization. WTTC. (2003). Special SARS analysis: Impact of travel and tourism (Hong Kong, China, Singapore and Vietnam reports). London: World Travel and Tourism Council.

A QUALITATIVE ASSESSMENT OF THE SERVICE ENCOUNTER Denver E. Severt, Paul D. Rompf and Kimberly S. Severt ABSTRACT This qualitative study collected regarding recalled service encounters by consumers across a broad range of encounters not just in service failures found respondents recalled service encounters from the hospitality leisure industry in 42% of encounters. Usually, the consumer recalls and reports at least two types of fairness when recalling a service encounter with procedural fairness the most reported, followed by interactional and then distributive fairness. The study suggests using fairness across a spectrum of service encounters and not just when a service failure is recalled and is also the first hospitality or service sector study to view service encounter outcomes into types of initial satisfaction, service recovery, and double deviation and then to follow up by assessing fairness types across outcomes.

INTRODUCTION In today’s competitive business environment it has become imperative for successful enterprises to focus on creating, maintaining, and replicating customer satisfaction. The academic literature mirrors this emphasis and

Advances in Hospitality and Leisure, Volume 3, 105–127 Copyright r 2007 by Elsevier Ltd. All rights of reproduction in any form reserved ISSN: 1745-3542/doi:10.1016/S1745-3542(06)03007-4

105

106

DENVER E. SEVERT ET AL.

striving to drive customers’ perceptions of ‘‘fairness may be a strategic course that simultaneously becomes a reliable metric for product and service quality which will lead to customer satisfaction.’’ By its very nature service typically requires some form of human interaction, often in real time and in the presence of a well-educated customer. Variability in the service provider’s motivation, training, ability, or even mood, results in variability in the quality of services provided and can cause customer satisfaction issues (Marmorstein, Sarel, & Lassar, 2001). An enterprise must work hard to meet, and preferably exceed, customers’ expectations, posited in the literature to be antecedents of satisfaction. Information acquired through word-of-mouth, advertising and other marketing activities are conventional sources believed to create and shape a customer’s expectations. However, the vast amount of information on the Internet has produced customers who are well aware, informed, and demanding (Ndhlovu & Senguder, 2002). This elevates consumer service-encounter perceptions to be critical elements in the long-term success of an organization. A customer is assumed to have pre-purchase expectations regarding service performance. These expectations are then compared with his/her perceptions of the service as it is rendered (Swanson & Kelley, 2001). This in turn becomes a basis to assess a more global evaluation (satisfaction), and the process may be a conscious or unconscious event. A customer’s perception of fairness in the service encounter has been found to be a key element in the overall evaluation of service (Seiders & Berry, 1998) and across service encounter outcomes (Severt, 2002). According to Schneider and Bowen (1998), ‘‘fairness’’ has three dimensions – interactional, distributive, and procedural. Each has an effect on customers’ perceptions of the ﬁnal outcome of the service encounter. To be speciﬁc, customer satisfaction or dissatisfaction is posited to be affected by the customer’s perceptions of fairness. Early researchers initially viewed the ‘‘justice’’ (fairness) construct as two-dimensional – procedural (fairness of process) and distributive justice (fairness of pay). In due course, researchers subdivided procedural justice into interactional (fairness of personal interaction) and procedural (fairness of process). The terms ‘‘justice’’ and ‘‘fairness’’ are often used interchangeably among researchers. This researcher has a preference for and, therefore, uses ‘‘fairness’’ throughout the remainder of the paper. It is suggested that businesses typically lose about 50% of their customers every ﬁve years (Mack, Mueller, Crotts, & Broderick, 2000). Smith, Bolton, and Wagner (1999) stated that organizations are facing more intense customer service pressure than ever before and that, in the event of a service

A Qualitative Assessment of the Service Encounter

107

failure, a service provider’s response has the ability to restore customer satisfaction and establish loyalty. Since customers often react strongly to a service failure, it is critical that organizations put appropriate efforts into recovering from service failures (Smith et al., 1999). To a great extent the service literature discusses service failure and the importance of service recovery to secure customer loyalty. A few researchers emphasize the conceptual and empirical importance of fairness (Severt, 2005; Smith et al., 1999), and it is not solely relegated to the service recovery process. The research purpose includes: What industry is most reﬂected by customers when relating stories about their service encounter and how many of those incidences naturally are recalled from the hospitality and tourism sector? What type (initial satisfaction, service recovery, double deviation) of service encounter outcome is most recalled by customers when relating stories about their service encounter? Do customers recall satisfying service encounters or dissatisfying service encounters more (most) frequently? Which forms of ‘‘fairness’’ are predominantly evident in recalled service encounters for satisﬁed and dissatisﬁed respondents? Which form of fairness is reported most frequently in the recalled service encounters?

LITERATURE REVIEW There are tens of millions of service encounters daily, spanning across a countless number of companies and industries. Bitner, Brown, and Meuter (2000) offer Disney and Federal Express as exemplars of companies who manage millions of service encounters each day. The importance of each encounter to purchase outcomes is of relevance to the ﬁrm (e.g., customer satisfaction, proﬁtability, loyalty, and repeat business) and makes it imperative for an enterprise to understand how to best manage its service encounters (Bitner et al., 2000). Customer Satisfaction/Dissatisfaction Oliver’s (1980) study (as cited in Andreassen, 2001 and Senguder, 2002) deﬁnes satisfaction as consumer’s judgment that she/he has reached a point of fulﬁllment. It is the judgment that a product or service feature, the

108

DENVER E. SEVERT ET AL.

product or service itself, has provided a pleasurable level of consumptionrelated fulﬁllment. Dissatisfaction therefore is viewed as the displeasure of under-fulﬁllment (Senguder, 2002). Bei and Chiao (2001) operationally regard customer satisfaction as a function of perceived service quality, product quality, and price; and it is measured by a consumer’s summary judgment. The end result is a positive or negative feeling of fulﬁllment (Andreassen, 2001). In general, researchers view customer satisfaction to result from a comparison of expected attribute levels before the encounter with perceived attribute levels after the encounter (Walker, 1995). The most widely used model within the customer satisfaction/dissatisfaction literature is the disconﬁrmation paradigm (McCollough, Berry, & Yadav, 2000). The disconﬁrmation paradigm posits that customers compare perceived product performance to pre-encounter expectations. Performance that exceeds expectations is positively disconﬁrmed, performance that meets expectations is conﬁrmed, and performance that falls short of expectations is negatively disconﬁrmed. Spreng, MacKenzie, and Olshavsky (1996) proposed an extension of the disconﬁrmation model that takes into consideration a consumer’s purchase-related desires, placing emphasis also on the extent she/he attained her/his desired end-state. Gagliano and Hathcote (1994) suggested that customer satisfaction is important because there are signiﬁcant short-term and long-term costs associated with poor customer satisfaction. The former could result in a walkout while both may lead to customer defection.

Service Failure Hoffman, Kelley, and Rotalsky (1995) suggested that although many service failures might be the result of inappropriate employee behavior, delivery system failures (e.g., product defects, slow service, facility problems, and unclear policies) account for the majority of service failures. Alexander (2002) reported service failures as a function of (1) employee response to service delivery systems, (2) employee response to customer needs and request, (3) unprompted employee actions, and (4) inappropriate customer behavior. Even the best ﬁrms will suffer periodic service failures. A service failure can occur at any stage of contact/interaction between a customer and the service provider (Bejou & Palmer, 1998). A service failure may be all but inevitable and there is nothing more disconcerting to a ﬁrm than having a customer perceiving something has gone wrong. Customers have even come

A Qualitative Assessment of the Service Encounter

109

to realize that being loyal to a particular service provider is no guarantee against occasional service failure (Matilla, 2001). Mack et al. (2000) proposed that the multidimensional nature of the service encounter creates an environment where failure may be the norm and not the exception. Increased competition, the abundance of choices in service providers, limited time, and income all attribute to the service failure problem that many organizations in the service industry are facing. Organizations now realize the substantial economic beneﬁts that can accrue to those who effectively implement service recovery strategies and retain customers. Therefore, it is further imperative that organizations understand the manner by which customers accept service recovery attempts (Swanson & Kelley, 2001). Smith et al. (1999) distinguish between two types of failures – outcome failure and process failure. In outcome failure, the service provider does not fulﬁll the basic service need of the customer. In the latter, the service is ﬂawed or deﬁcient in some way. If a single failure in a service encounter is not resolved with care and precision, it may evolve into chain of service failures from which it will be more difﬁcult to recover from, if at all. The ﬁndings of Maxham and Netemeyer’s (2002) longitudinal study suggest that even though satisfactory recoveries can be achieved after one failure, they are more difﬁcult and less likely to be achieved after two failures. The study also found that customers reporting two failures may sense a pattern of negative performance and thus combine both service failures instead of forgetting the ﬁrst. Customers may also perceive sequential service failures as one overall failure thereby heightening the severity of the second failure. Smith et al. (1999) posited that the type and degree of service failure will inﬂuence a customer’s evaluation of a service failure/recovery encounter, because the failure context serves as a reference point from which the customer judges the fairness of the encounter.

Service Recovery Service failure triggers the need for service recovery (Smith et al., 1999). Bitner, Booms, and Tetreault (1990) study (as cited in Johnston & Fern, 1999) indicated that it is not necessarily the failure itself that leads to customer dissatisfaction since most customers accept that things can go wrong. Rather, it is more likely to be the service provider’s response (or lack of response) to the failure that results in dissatisfaction. Service recovery involves the implementation of speciﬁc procedures to counteract and bring resolution to a service failure. Johnston and Fern

110

DENVER E. SEVERT ET AL.

(1999) suggested that it is an important means of satisfying customers after a failure has occurred. To develop an environment conducive to identifying failure and achieving effective recovery, the importance of service recovery must be communicated (Tax, Brown, & Chandrashekaran, 1998). Managers could view service recovery as a bundle of resources in which each resource has a different effect on the customer’s perception of the three dimensions of fairness. Therefore, to enhance perceptions of fairness, organization should tailor their service recovery efforts by providing ﬂexibility in resource use to have the greatest positive impact on the customer’s responses that would ultimately result in a willingness to return (Smith et al., 1999). In general, recovery efforts can only partially eliminate the dissatisfaction that is derived from service failure (McCollough, 1995). According to Matilla (1999), a recovery strategy can be effective only when the service provider demonstrates high reliability during the service delivery. Maxham’s (2001) ﬁndings support the positive effects of a strong service recovery on customer satisfaction. In contrast to other ﬁndings, the results did not support postrecovery satisfaction being greater than satisfaction prior to the service failure. Nevertheless, Boshoff and Allen (2000) suggest that service recovery can be a winning situation not only for customers but also for employees and the organization. Such achievement results from service recovery strategies that sustains and retains the customer. The present research sought to investigate customer’s judgments regarding fairness and satisfaction across an expanse of service encounters, and was not limited to instances of service failures. Garlick (2006) cautioned against a misguided focus that can result from an emphasis by management on service recovery in contrast to ‘‘getting it right the ﬁrst time.’’ He posits that a problem-resolution effort that just meets expectations will likely result in a guest continuing to hold the ‘‘event’’ against the enterprise. Finally, another form of service encounter outcome is referred to as double deviation. This service encounter type is one whereby the patron or some of the business personnel notices a service failure, a recovery is attempted and then the company fails again. This type of failure is known as double deviation from expectation and is a double service failure.

FAIRNESS Fairness, also referred to as equity and justice, is a multidimensional construct (Ruyter & Wetzels, 2000). Each time a failure occurs it becomes a negative force against consumers’ perceptions of fairness (Boshoff & Allen, 2000).

A Qualitative Assessment of the Service Encounter

111

Palmer, Beggs, and Keown-McMullan (2000) study operationalized fairness as the difference between a respondent’s perception of the level of a service failure and their perception of the effort applied by the service provider in correcting the mistake. According to Buttle and Burton (2002), the key to successful recoveries was found to be a customer’s perception of fairness. Palmer et al. (2000) posited that the perceived level of fairness following a service failure was important in inﬂuencing repurchase retentions. Customers who perceive a lack of distributive or interactional fairness are much more likely to engage in post-redress, negative word-of-mouth, and are less likely to repurchase from the service provider (Blodgett, Wakeﬁeld, & Barnes, 1995). Conversely, those who perceived high interactional justice and distributive justice during a service encounter are more likely too engage in positive word-of-mouth behavior and repurchase from the service provider. Hoffman and Kelley (2000) presented several contingencies for effective service recovery. These involve the depth of customer/service provider relationships, the closeness of the relationship, the length of duration of the encounter, the degree of tailoring to the customer’s needs, the shifting of expense, and the urgency and importance of consumptions. These contingencies inﬂuence the customer’s perception of distributive, procedural, and interactional fairness. Interactional fairness is demonstrated when a customer is treated with respect, politeness, and dignity (Bies & Moag, 1986). The concern may not be about ‘‘what is given’’ but ‘‘how it is given.’’ The longer the duration of the encounter, the more likely it is that the customer places an increased importance on the interactive fairness when evaluating an organization’s service recovery efforts (Hoffman & Kelley, 2000). In concert, Bies and Shapiro (1987) indicate that interactional fairness involves the manner in which information is exchanged and outcomes are communicated. It refers to those aspects of an exchange that concern communication processes and the treatment of individuals. Distributive fairness perceptions involve the allocation of compensation (in the form of discounts, free merchandise, refunds, coupons, etc.) by the organization in response to the inequity caused by a service failure (Smith et al., 1999). McCollough et al. (2000) indicate that although distributive fairness can be conceptualized as customer’s evaluations of whether they get their money’s worth, it also can include nonmonetary inputs and outputs involving such tangibles as emotions (anger and embarrassment), complaint cost (time and effort), and ego beneﬁts.

112

DENVER E. SEVERT ET AL.

Procedural fairness involves the processes/means by which decisions are established and conﬂicts are resolved (Lind & Tyler, 1988). Fair procedures begin with the service provider assuming the responsibility for the failure. System ﬂexibility that takes individual situations into account and receives input from the customer on what the ﬁnal outcome should be is another aspect of procedural fairness (Tax & Brown, 1998). Finally, the studies conducted have been from the service marketing literature but have taken place largely in the hospitality and leisure setting (e.g., Smith et al., 1999) which occurred in a lodging setting. And the notion that a fairness scheme is associated with satisfaction across all levels of the service encounter lends support to using fairness when measuring speciﬁcs of customer satisfaction particularly in the leisure setting as many comparisons are being made in a short amount of time.

METHODOLOGY The results from this study reﬂect one component of a broader mixed study design. The latter had a total of 302 survey respondents, but only 128 are used in this analysis. The survey directions requested a respondent to recall a service encounter, write a description of the service encounter (optional), and then answer a series of questions related to the encounter. This study investigated the qualitative component in the data by analyzing the written portion of the recalled service encounters. Content analysis was utilized to categorize the data in a multistep process. First, the service encounters were grouped by type of service provider and then type of service encounter recalled. Subsets of the service-encounter groups were obtained by dividing it into satisﬁed and dissatisﬁed customers. Subsequently, ‘‘fairness’’ types were assigned to the text-laden data. The ﬁnal step was to identify the fairness issue(s) in each of the recalled service encounters. The multistage process was initially undertaken by the researcher. Two independent researchers reviewed the initial results of each iterative step, and found exceptions to some of the preliminary ﬁndings. The noted differences were then discussed by the researchers and a ﬁnal decision was obtained by consensus. The researcher interpreted respondents’ satisfaction to be a function of their perceptions of interactional, distributive, and procedural fairness. Respondents were asked to recall a service encounter that occurred within the last six months, and were then requested to provide more detailed

A Qualitative Assessment of the Service Encounter

113

information related to the encounter. No restrictions were attached as to whether the encounter was positive or negative. Descriptive information about type of business accompanied a narrative summary of the service encounter itself. The respondents were randomly intercepted at a midwest metropolitan airport over a three-week period, and 128 useable surveys resulted for a qualitative content analysis. Krippendorff (1969) deﬁned content analysis as the use of a replicable and valid methodology to make inferences from text-based data with the ability to ascertain speciﬁc states or properties of its source. Categorical criterion is derived from a theoretical foundation and the research question. Following this criterion, iterative steps are followed in the assignment of categories to the text-based data (see criterion Tables 1–3). The research questions have quantitative aspects (e.g., frequencies of coded categories), these are in the study as well. In the study, ‘‘satisfaction’’ was operationalized through an analysis of respondents’ statements and resultant perceptions of interactional, distributive, and procedural fairness. As the second part of a quantitative study, this study attempted to further divide the service encounter across a spectrum of outcomes including initial satisfaction, service recovery (after one failure), and then double deviation.

Table 1.

Type of Encounter Outcome.

Type of Encounter Outcome

Abbreviation

Deﬁnition

# Recalled

% Recalled

Initial satisfaction

IS

32

25

Service recovery

SR

27

21

Double deviation

DD

No service failure occurred during service encounter. Customer is pleased with the outcome Failure occurs and customer complains. Service provider implemented corrective measures and successfully resolves the problem and customer satisﬁed Failure occurs. Customer complains but no corrective measures are effectively implemented to rectify the situation and secure customer satisfaction

69

54

114

DENVER E. SEVERT ET AL.

Table 2. Type of Satisfaction. Type of Satisfaction Satisﬁed

Dissatisﬁed

Table 3. Type of Fairness

Abbreviation

Deﬁnition

# Recalled

% Recalled

S

Customer is pleased with the overall results of the service encounter Customer is not pleased with the overall results of the service encounter

58

45

70

55

DS

Type of Fairness in the Service-Encounter Narrative. Abbreviation

Deﬁnition

# Recalled

% Recalled

Interactional

IF

20

15

Distributive

DF

18

14

Procedural

PF

Interactional fairness refers to the manner of the people in the service encounter Distributive fairness is the fairness included in the price and product outcome of the service encounter Process fairness is the fairness included in the procedures of the service encounter A combination of the ‘‘people’’ and ‘‘process’’ fairness A combination of the ‘‘people’’ and the ‘‘product and price’’ fairness A combination of the ‘‘process’’ and the ‘‘price and product’’ fairness

46

36

24

19

11

9

9

7

Interactional and procedural Interactional and distributive Procedural and distributive

IFPF IFDF

PFDF

Respondents ﬁrst answered questions on valid and reliable fairness and satisfaction scales. Following this, respondents were asked to tell the story of the encounter they recalled. Over half of the respondents chose to write the stories that are analyzed in this study. The question prompting respondents after the initial survey was: Please tell the story of this service encounter here including the type of business that the encounter took place in? The story results are analyzed below.

A Qualitative Assessment of the Service Encounter

115

RESULTS AND DISCUSSION Research Purpose One: What Industry is Most Reflected by Customers when Relating Stories about their Service Encounter? Of the 128 respondents in which each recalled a speciﬁc service encounter, 33 service provider categories and they represented several service industry sectors. The types of service providers reported were categorized into eight industries: hospitality and travel, retail, automobile, personal services, utilities, home, government, and home services (see Table 4). The hospitality and travel category (e.g., restaurants, lodging, transportation, attractions, and entertainment) had the largest percentage of recalled service encounters (42.2%; n ¼ 54). Restaurants, as a subset, represented the largest percentage within this category as well as 27% of all service encounters recalled. In fact, with the exception of retail, it exceeded all other individual category summary totals.

Research Purpose Two: What Type (Initial Satisfaction, Service Recovery, Double Deviation) of Service Encounter Outcome is most Recalled by Customer when Relating stories about their Service Encounter? The service encounters were categorized into three different categories: (1) initial satisfaction (IS), service recovery (SR), and double deviation (DD). The highest recalled service encounter (Table 1) was double deviation with more than half of respondents reporting this outcome (54%; n ¼ 69). A fourth was initial satisfaction (n ¼ 32) and was closely followed by service recovery (21%; n ¼ 27). These results are not surprising and are consistent with past studies. As in the majority of instances in this study, patrons would be expected to more readily recall incidents where they are not initially satisﬁed, they complained, and again are not satisﬁed. This should be most troubling to an enterprise as the outcome leads a path to defection for the customer. The other two outcomes, satisfaction and service recovery, suggest that customers are also likely to recall those initially satisfying encounters and the encounters that were recovered. At the enterprise level, double dissatisfaction is the most dangerous for businesses because it lingers and is shared with more people, thus doing more damage by way of negative word-of-mouth. A focal mission of the

116

DENVER E. SEVERT ET AL.

Table 4. Type of Service Provider Recalled. Service Provider Category Hospitality and travel

Retail

Automobile

Personal services

Utilities

Home

Government

Home services

Sub-Category

Number

Restaurant Lodging Transportation Attraction Entertainment Total General Mail order Grocery Internet Bookstore Party store Total Purchase Repair/maintenance Total Banking Insurance Healthcare Barber Computer service Dry cleaner Total General Telephone Cable Total Builder Moving Total Local Public library Total Lawn care Carpet cleaning Total Over total

35 10 7 1 1 54 28 1 7 1 1 1 39 2 10 12 2 1 1 1 2 1 8 1 3 1 5 3 1 4 3 1 4 1 1 2 128

% of Total Recalled

42.2

30.5

9.4

6.3

3.9

3.1

3.1

1.6 100.0

business should be to reduce double dissatisfaction to as low as possible to avoid the negative publicity brought about by the double deviation encounter. When a failure happens, appropriately correcting it may lead to more recovery stories and a positive spin on the results.

A Qualitative Assessment of the Service Encounter

117

Research Purpose Three: Do Customers Recall Satisfying Service Encounters or Dissatisfying Service Encounters More (Most) Frequently? To determine whether customer satisfaction was achieved during the entire service encounter, the study categorized each respondent (Table 2) as satisﬁed (S) or dissatisﬁed (DS). Slightly less that half were satisﬁed (45%; n ¼ 58), while 55% (n ¼ 70) were dissatisﬁed with their service encounter results. The customers who were dissatisﬁed appeared most happy to write their story, again, a powerful predictor for the lingering effect of double deviation from expectation failures that need to be avoided by businesses.

Research Purpose Four: Which Forms of ‘‘Fairness’’ are Predominantly Evident in Recalled Service Encounters for Satisfied and Dissatisfied Respondents? A cross tabulation procedure was used to compare satisfaction/dissatisfaction outcomes with the fairness types (Tables 2 and 3), and the results are summarized in Table 5. This aids in identifying any correlation between the results of customers who were satisﬁed and those who were not and the differences between fairness types that were used in their evaluation process. Customers who were dissatisﬁed clearly reported procedural fairness (50%) as a major problem in the service encounter. Customers are not happy when the service Table 5.

Cross Tabulation of Satisfaction/Dissatisfaction and Fairness. Fairness

Satisfaction

Dissatisfaction

Total

IF

DF

PF

PFDF

IFPF

IFDF

Count % within satisfaction % within fairness % of total

10 17 52.6 7.8

9 15.5 50.0 7.0

11 19 23.9 8.6

8 14 88.9 6.3

11 19 45.8 8.6

9 15.5 75.0 7.0

58 100

Count % within dissatisfaction % within fairness % of total

10 12.9 47.4 7.0

9 12.9 50.0 7.0

35 50.0 76.1 27.3

1 1.4 11.1 8

13 18.6 54.2 10.2

2 4.3 25.0 2.3

70

Total

20 15

18 14

46 36

24 19

11 9

9 7

45.3

54.7 128 100

118

DENVER E. SEVERT ET AL.

provider’s problem becomes their problem. In comparison, the customers who reported a satisfying service encounter, there was no one fairness type that proved to be more prevalent than any other. However, the combination of procedural and interactional fairness did account for 55.2% of the responses.

Research Purpose Five: Which Types of Fairness are Reported most Frequently in Recalled Service Encounters? The most frequently reported fairness type was procedural fairness at 36%. Personal statements included comments such as: ‘‘I wasted my time standing in long lines due to an inadequate number of cashiers,’’ ‘‘My meal was 10 minutes later than everyone else’s and my steak was not well done as I ordered,’’ and ‘‘I have had my car for 9 months and still all the options are not added due to dealership backup schedule.’’ These statements reveal the process of the service provider that is being evaluated by the customer in the service encounter. The combination of interactional and procedural fairness (IFPF) was the second most frequently reported type of fairness at 19%. Statements included: ‘‘She was on a personal phone call for twenty minutes and ignored my request for her to ring up my ticket,’’ and ‘‘The server did not ask our preference for smoking or non-smoking and then rushed us to order.’’ Interactional fairness statements accounted for 15% of the reported service encounters. These include such statements as: ‘‘Server was inattentive, discourteous, and agitated’’ and ‘‘the cashier rudely grabbed my ticket.’’ These statements clearly indicate the importance of people interaction in the service encounter. Distributive fairness statements accounted for 14% of the reported service encounters. An example of these statements are: ‘‘The dealer gave me a better price for the new Ford Explorer,’’ and ‘‘They accept my returns when I ﬁnd the same items somewhere else at a lower price.’’ The combination of interactional and distributive fairness (IFDF) accounted for 9% of the reported service encounters. Examples of these statements are: ‘‘She kindly gave me information that assisted my ﬁnancial plans,’’ ‘‘the kind hotel staff provided recommendations for attractions and tour programs,’’ and ‘‘they were rude and would not return my money.’’ The combination of procedural and distributive statements accounted for 7% of service encounters reported. An example of these statements include: ‘‘They told me the repair would be ﬁnish on Monday and when I returned

A Qualitative Assessment of the Service Encounter

119

on Tuesday it was not ﬁnished and they would not adjust the price,’’ and ‘‘I told him I wanted my twenty dollars back and he said I should have asked sooner.’’ These results conﬁrm the importance that a ﬁrm’s process has on customer satisfaction particularly when service failure is involved. From these ﬁndings it appears that a fair process is recalled more than the interpersonal interaction with the service provider. Together, they make a deadly combination for negativity or a wonderful pair in resolving and delighting guests. Table 6 provides a detailed listing of the 128 service encounters analyzed.

SUGGESTIONS FOR FUTURE RESEARCH The current study highlights the importance of doing research speciﬁc to encounter type outcomes (initial satisfaction, service recovery, or double deviation) and classifying what is happening in the encounter type according to type of fairness (interactional, distributive, and procedural). This will allow the researchers to explore the critical behaviors during the worse service encounters that become deal breakers or best behaviors during the best service encounters that become dealmakers for the ﬁrm. One of the additions of this study to the service literature is that it provides insight into how customers evaluate service by their evaluation of fairness across three outcomes of the service encounter and also shows how customers use a combination of fairness dimensions to evaluate the service encounter. Since this study was based on recalled service encounters, it demonstrates how fairness in the service encounter evaluation stays with the customer over a period of time. This research can aid service enterprises in their ongoing mission to continuously execute appropriate strategies according to the rising expectations of the guest. It aids to theory by further dividing the service encounter by type of outcome. This dissection of the service encounter can help businesses and researcher study the service encounter more speciﬁcally allowing for better measurement of service results, an area that has been slow to develop. It is apparent that service providers should ﬁne-tune their service delivery systems because when the process fails, customers remember and they are not satisﬁed. This was the number one reason reported in dissatisﬁed service encounters. Procedural fairness also proved to be prevalent in satisfying encounters as well. Satisﬁed customers appear to remember not so much what they paid for the service but if the process was fair and how they were

Story

120

Table 6.

Service Encounter Classiﬁcation.

Type of Encounter

Type of Satisfaction

Type of Fairness

Encounter Details

1 2 3 4 5 6 7 8 9 10 11 12 13

Retail Retail Lawn Retail Retail Local govt. Car repair Telephone Restaurant Mail order Grocery store Online Grocery store

SR DD SR IS IS DD IS DD DD SR DD DD IS

S DS S S S DS DS DS DS S DS DS S

PF/DF PF PF PF/DF IF/PF IF DF PF PF DF PF PF/DF PF

14 15 16 17 18 19 20 21 22 23 24 25 26

Retail Hotel Hotel Auto dealership Retail Home builder Restaurant Restaurant Retail Restaurant Restaurant Restaurant Book store

DD DD SR SR SR DD DD DD IS DD SR SR DD

DS DS S S S DS DS DS S DS S S DS

PF/IF PF PF/DF PF IF/DF PF PF PF DF PF IF/DF IF/PF PF/IF

Returned item for exchange Leather furniture fell apart after 2 years; no compensation Lawn service ruined ﬂowers; apologized and replaced Attendants made shopping experience wonderful Service rep. very helpful; provided answers to questions Employee lacked customer service skills Great service, but too costly Company did not make code differentiation for each call Poor customer service Company replaced damaged dress after much confusion Long waiting period perhaps due to inadequate stafﬁng Incorrect order; complications with exchange procedures Not a discount card holder however cashier applied discount Inattentiveness and displeasing attitude toward customer Front desk clerk lacked enthusiasm and service skills Reservation cancelled but GM authorized employee disc Problem resolved only after several visits Poor quality workmanship Poor service Inattentiveness and poor service Great service and product Long wait to be seated and served Server made rude assumptions Cashier’s rude attitude

DENVER E. SEVERT ET AL.

Service Provider

S S S D S D

DF PF/DF IF/PF PF DF PF

Very helpful clerk, assisted in ﬁnding right product Manager provided new replacement for equipment Attendant very empathetic, understanding and helpful Failure to complete job as scheduled Problems corrected by competent repair person Inattentiveness to customer’s needs

SR IS DD IS SR DD SR DD IS

S S DS S S DS S DS S

IF/DF IF/DF PF PF PF DF DF IF PF

Order not correct, rude server, meal comped Sales rep. showed appreciation by his service and manner Poor customer service Very friendly and helpful Hotel staff realized mistake and corrected problem Long waiting periods, inadequate product quality Dealer provided better price Failure to accept $2 bill for fear it may be a counterfeit Sales associate very helpful in locating item

DD DD DD IS SR DD DD DD DD

DS DS DS S S DS DS DS DS

PF IF PF IF/DF PF IF IF/PF PF PF

51

Hotel

SR

S

PF

52 53 54

Restaurant Restaurant Retail

DD DD IS

DS DS S

IF/DF IF/PF PF/DF

Rude, impatient server Very poor customer service Secured wallet, but no attempt made to send wallet One of the best customer satisfaction experiences Found problem and addressed it Attendants were not sympathetic and helpful Improper food handling practices Faulty repair work, complained but no action taken Waived meal charge; it did not make up for the poor service No room service but provided phone numbers for pizza delivery Failure to meet customer’s expectations Lack attention to customer, slow disjointed service Full refund plus 20%

33 34 35 36 37 38 39 40 41

121

IS SR SR DD IS DD

42 43 44 45 46 47 48 49 50

Retail Retail Airline Auto dealership Local Govt. Moving company Restaurant Retail Auto rental Bank Hotel Restaurant Auto dealership Restaurant Retail restaurant Restaurant Party store Restaurant Home builder City mgmt Airline Restaurant Auto repair Restaurant

A Qualitative Assessment of the Service Encounter

27 28 29 30 31 32

122

Table 6. (Continued ) Service Provider

Type of Encounter

Type of Satisfaction

Type of Fairness

Encounter Details

55 56 57 58 59 60 61 62 63 64 65 66 67 68 69 70 71 72 73 74 75 76 77 78 79 80 81 82

Restaurant Auto repair Restaurant Hotel Restaurant Restaurant Grocery Grocery Restaurant Airline Retail Airline Insurance co. Restaurant Auto dealership Restaurant Auto repair Transportation Retail Retail Healthcare Grocery store Telephone co. Restaurant Restaurant Disney World Retail Retail

IS IS DD IS SR DD DD DD DD DD DD DD DD SR DD DD DD IS IS IS DD SR DD DD DD SR SR DD

S S DS S S DS DS DS DS DS DS DS DS S DS DS DS S S S DS S DS DS DS DS S DS

DF PF/DF DF/IF PF/IF IF IF PF IF/PF IF/PF PF IF PF PF PF/IF PF DF DF IF IF PF/IF PF IF/PF PF DF PF PF DF IF

Good food and service Service rep. explained and completed procedures Waitress seemed overwhelmed, poor attitude Management and staff very helpful Server noticed we were not happy, offered something else No greetings, no apology for long wait Long and complicated process correcting error Angry cashier Server lacked good customer service skills Problem with E-ticket, attendant unable to explain Very negative unsatisﬁed service encounter Unfair treatment, felt discriminated against Company did not follow through with promise Manager’s gestures encouraged revisit Unreasonable price offer Upscale restaurant – expected linen service not paper Timeline not met to complete job, faulty repair job Bus driver customer service oriented, genuinely cares Sales person very helpful with purchasing decision Honored outdated coupon, accepted return items Long waiting period while still in pain Replace old cart with new and improved one Service rep. provide misleading info regarding charges Unclean facility, especially smoking area and restrooms Slow service and lack of attention to customer service Long delay in upgrading procedure for ticket passes Missing parts, company handled fairly when reported Cashier’s failure to assist customer, said she was busy

DENVER E. SEVERT ET AL.

Story

SR DD SR DD DD IS DD IS DD IS SR

S DS S DS DS S DS S DS S S

DF/PF PF PF/IF DF PF PF/IF IF IF IF/PF IF/DF IF/DF

94 95

Auto repair Hotel

DD DD

PS DS

IF PF

96 97 98 99 100 101 102 103 104 105

Public library Barber shop Restaurant Grocery Retail Video Retail Retail Bank Hotel

IS DD DD IS IS IS IS DD IS IS

S DS DS S S S S DS S S

IF DF DF PF IF IF/DF DF IF IF/DF DF

Contact difﬁcult to reach, but exceptional cleaning job Did not give refund due, applied late charges Explained problem and solution gave free ticket Returned order three times, very dissatisﬁed Failure to complete job within reasonable time period Managers accepted return even after policy deadline Server dissatisﬁed with tip amount and demand more Great service, vendor went beyond call of duty Failure to provide phone features requested Clean facility and good customer service Problem with ﬂight availability, supervisor solved problem Service was good but employee was unfriendly Failure to inform guest of carriage availability as promised Assisted with computer problem Employee did not adhere to client’s preferred style Long wait for food, poor service overall Technical problem with ATM employee helped Sales rep. helped with questions Need help, thought employee forgot Needed refund because ﬁsh died, no problem Employee did not want to help with question Banking and ﬁnancial question manager was excellent Provide good recommendations for attractions and tours

106 107 108 109 110 111 112

Hotel Retail Grocery Retail Restaurant Restaurant Restaurant

DD DD IS DD DD DD DD

PS DS S DS DS DS DS

PF PF IF PF PF/IF PF PF

No hot water for indoor-pool, failure to notify Failure to complete job within promised time period Returned items for lower price, no problem Did not pay attention to customer Long wait for service and incorrect order Server overturned tray on customer by accident Delayed in taking guest’s order, unfriendly attitude

123

Carpet cleaning Cable co. Movie theatre Restaurant Home builder Retail Restaurant Restaurant Telephone Restaurant Airline

A Qualitative Assessment of the Service Encounter

83 84 85 86 87 88 89 90 91 92 93

124

Table 6. (Continued ) Story

113 114 115 116

Type of Encounter

Type of Satisfaction

Type of Fairness

Computer service Retail Dry cleaners Computer service Camp ground Auto repair Auto repair Maintenance Utility service Restaurant Retail Restaurant Restaurant Video Retail Hotel

IS

S

IF

SR DD DD

S DS DS

PF IF/PF IF/PF

DD DD SR DD IS IS DD SR DD DD SR DD

DS DS S DS S S DS S DS DS S DD

IF/PF PF PF/DF PF IF IF/PF IF/PF IF/DF/P IF/PF IF/DF PF DF

Rep., representative.

Encounter Details

Patient and helpful service personnel with computer problem Replaced part in basketball hoop kit, no problem Poor service, no refund, redone elsewhere better result Questions about bill, service rep. did not help Employee rude and did not give rain check as promised Failure to complete job with the promised time frame Good repair work Repair problem not corrected Service employee informed client of grace period policy Accidentally dropped meal, cashier provided another Would not help in a timely manner, rude cashier Incorrect order, but cashier made correction Waitress was rude and poor service overall Video system switched to another brand Returned item purchased, manager provided cash refund Noisy AC, ice machine not working, unpleasant

DENVER E. SEVERT ET AL.

117 118 119 120 121 122 123 124 125 126 127 128

Service Provider

A Qualitative Assessment of the Service Encounter

125

treated during the service encounter. Furthermore, such a decomposition of the service encounter is a good beginning and will aid researchers in improving the level of detail input into service research and thus the level of improvement that businesses may achieve from the research. Further research is needed to investigate fairness behavior and successful encounters along with unfair behavior with unsuccessful service encounters. Only when a company takes a detailed look at what is happening across all encounters can the company begin to ﬁne-tune their service delivery. This study did not investigate the individual businesses recalled. Doing so along with the speciﬁc phrases describing the encounter may provide richer data for understanding the phenomenon. This was beyond the scope of the present study. However, acknowledging that this is also needed will be helpful to the researcher in making a true addition to the current body of service knowledge.

REFERENCES Alexander, E. C. (2002). Consumer reaction to unethical service recovery. Journal of Business Ethics, 36, 223–237. Andreassen, T. W. (2001). From disgust to delight. Do customers hold a grudge? Journal of Service Research, 4(1), 39–50. Bei, L., & Chiao, Y. (2001). An integrated model for the effects of perceived products, perceived service quality, and perceived price fairness on consumer satisfaction and loyalty. Journal of Consumer Satisfaction, Dissatisfaction and Complaining Behavior, 14, 125–141. Bejou, D., & Palmer, A. (1998). Service failure and loyalty: An exploratory empirical study of airline customers. Journal of Services Marketing, 12(1), 7–22. Bies, R. J., & Moag, J. S. (1986). Interactional communication criteria of fairness. In: R. J. Lewicki, B. H. Sheppard, & M. H. Bazerman (Eds), Research in organizational behavior. Greenwich, CT: JAI Press. Bies, R. J., & Shapiro, D. L. (1987). Interactional fairness judgments: The inﬂuence of causal accounts. Social Justice Research, 1, 199–218. Bitner, M. J., Brown, S. W., & Meuter, M. L. (2000). Technological infusion of service encounters. Academy of Marketing Science, 28(1), 138–150. Bitner, M. J., Booms, B., & Tetreault, M. (1990). The service encounter: Diagnosing favorable and unfavorable incidents. Journal of Marketing, 54(1), 71–84. Blodgett, J. G., Wakeﬁeld, K. L., & Barnes, J. (1995). The effects of customer service on consumer complaining behavior. Journal of Services Marketing, 9(4), 31–42. Boshoff, C., & Allen, J. (2000). The inﬂuence of selected antecedents on frontline staff’s perceptions of service recovery performance. International Journal of Service Industry Management, 11(1), 63. Buttle, F., & Burton, J. (2002). Does service failure inﬂuence customer loyalty? Journal of Consumer Behavior, 1(3), 247–258.

126

DENVER E. SEVERT ET AL.

Gagliano, K., & Hathcote, J. (1994). Customer expectations and perceptions of service quality in retail apparel specialty stores. The Journal of Service Marketing, 8(1), 60. Garlick, R. (2006). The myth of service recovery. Loding Hospitality, 62(11), 32–34. Hoffman, D. K., & Kelley, S. W. (2000). Perceived justice needs a recovery evaluation: A contingency approach. European Journal of Marketing, 31(3/4), 418. Hoffman, K. D., Kelley, S. W., & Rotalsky, H. M. (1995). Tracking service failures and employee recovery efforts. Journal of Services Marketing, 9(2), 49–61. Johnston, R., & Fern, A. (1999). Service recovery strategies for single and double deviation scenarios. The Service Industries Journal, 19(2), 69–83. Krippendorff, K. (1969). Models of messages: Three prototypes. In: G. Gerber, O. R. Holsti, K. Krippendorff, G. J. Paisly & P. J. Stone (Eds), The analysis of communication content. New York: Wiley. Lind, E. A., & Tyler, T. R. (1988). The social psychology of procedural justice. New York: Plenum Press. Mack, R., Mueller, R., Crotts, J., & Broderick, A. (2000). Perceptions, corrections, and defections: Implications for service recovery in the restaurant industry. Managing Service Quality, 10(6), 339. Marmorstein, H., Sarel, D., & Lassar, W. (2001). Increasing the persuasiveness of a service guarantee: The role of service process evidence. The Journal of Services Marketing, 15(2), 147–163. Matilla, A. (1999). Consumer’s value judgment. Cornell Hotel & Restaurant Administration Quarterly, 4(1), 40–47. Matilla, A. (2001). The impact of relationship type on customer loyalty in a context of service failures. Journal of Service Research, 4(2), 91–102. Maxham, J. G. (2001). Service recovery’s inﬂuence on consumer satisfaction, positive wordof-mouth, and purchase intentions. Journal of Business Research, 55(5), 401–415. Maxham, J. G., & Netemeyer, R. G. (2002). Modeling customer perceptions of complaint handling over time: The effects of perceived justice on satisfaction and intent. Journal of Retailing, 78(4), 239–253. McCollough, M. (1995). The effect of perceived justice and attributes regarding service failure and recovery on post-recovery customer satisfaction and service quality attitudes. American marketing association conference proceedings (Vol. 9, p. 163). Chicago. McCollough, M., Berry, L., & Yadav, M. (2000). An empirical investigation of customer satisfaction after service failure and recovery. Journal of Service Research, 3(2), 121–138. Ndhlovu, J., & Senguder, T. (2002). Gender and perception of service quality in the hotel industry. Journal of American Academy of Business, Cambridge, 1(2), 301–308. Oliver, R. L. (1980). A cognitive model of the antecedents and consequences of satisfaction decisions. Journal of Marketing Research, 14(March), 495–507. Palmer, A., Beggs, R., & Keown-McMullan, C. (2000). Equity and repurchase intention following service failure. The Journal of Services Marketing, 12(6), 198. Ruyter, K., & Wetzels (2000). Customer equity considerations in service recovery: A crossindustry perspective. International Journal of Service Industry Management, 11(1), 91. Schneider, B., & Bowen, D. (1998). Understanding customer delight and outrage. Sloan Management Review, 41(1), 5–20. Seiders, K., & Berry, L. (1998). Service fairness: What it is and why it matters. Academy of Management Executive, 12(2), 8–20.

A Qualitative Assessment of the Service Encounter

127

Senguder, T. (2002). An exploratory analysis of customer satisfaction. Journal of American Academy of Business, 2(1), 177–185. Severt, D. (2002). The customer’s path to loyalty. Unpublished doctoral dissertation, Virginia Polytechnic Institute and State University. Severt, D. (2005). An investigation of perceived justices and satisfaction. Advances in Hospitality and Leisure Studies, 2, 275–290. Smith, A., Bolton, R., & Wagner, J. (1999). A model of customer satisfaction with service encounters involving failure and recovery. Journal of Marketing Research, 36(August), 356–372. Spreng, R., MacKenzie, S., & Olshavsky, R. (1996). A reexamination of the determinants of consumer satisfaction. Journal of Marketing, 60(3), 15–32. Swanson, S., & Kelley, S. W. (2001). Attributions and outcomes of the service recovery process. Journal of Marketing Theory and Practice, 9(4), 50–66. Tax, S., & Brown, S. (1998). Recovering and learning from service failure. Sloan Management Review, 75–88. Tax, S., Brown, S., & Chandrashekaran, M. (1998). Customer valuations of service complaint experiences: Implications for relationship marketing. Journal of Marketing, 62, 60–76. Walker, J. (1995). Service encounter satisfaction: Conceptualized. The Journal of Services Marketing, 9(1), 5–15.

NEW SERVICE DEVELOPMENT: PRELIMINARY FINDINGS ON PROCESS DEVELOPMENT AND ASSESSMENT FROM THE GREEK HOTELS Marianna Sigala and Kalotina Chalkiti ABSTRACT Despite the competitive necessity of New Service Development (NSD), research into NSD and specifically within hospitality is scant. As tourists are becoming more sophisticated and less loyal, hotels need to continuously innovate to address the dynamically changing tourists’ demands and the fierce competition. This study aims to explore the level, type and processes of NSD efforts that Greek hotels undertake for creating, assessing and further improving their NSD practices. To achieve that, literature on NSD is critically reviewed and expanded. Data from the Greek hotel sector revealed not only that hotels need to substantially increase their NSD activities, but findings also confirmed the fact that, in contrast to manufacturing, NSD in services should consider the ad hoc nature of processes in service development as well as the role and participation of guests and other stakeholders in NS processes.

Advances in Hospitality and Leisure, Volume 3, 129–149 Copyright r 2007 by Elsevier Ltd. All rights of reproduction in any form reserved ISSN: 1745-3542/doi:10.1016/S1745-3542(06)03008-6

129

130

MARIANNA SIGALA AND KALOTINA CHALKITI

INTRODUCTION Organizations are faced with a dynamic and turbulent environment that requires ﬂexibility and innovation to changing business and market needs. Indeed, several societal and technological transformations justify the currently increasing business and academic interest in New Service Development (NSD) (Montoya-Weiss & Calantone, 1994; Martin & Horne, 1993; Alam & Perry, 2002) such as: discerning customers that seek to express themselves through personalized products and services; dynamically changing customers’ needs, service proliferation and decreasing product-service life cycles; and technological advances that, by enhancing and fostering (inter)-customer and staff communications, empower businesses with invaluable customer knowledge making them extremely intelligent and innovation competent. Consequently, NSD has been proposed as a competitive necessity and an important ingredient for moving ﬁrms to the experience economy, attracting and boosting long-term customer relationships and for enhancing business proﬁtability (Storey & Easingwood, 1999; Gustafsson, Ekdahl, & Edvardsson, 1999). Although tangible product development has received a great research attention (e.g. De Bretani, 1991), research into services’ development is scant. In recognizing the fundamental differences between products and services, several authors questioned the applicability of NPD models in services and highlighted the need for further research (e.g. Massa & Testa, 2004). However, the signiﬁcance and usability of New Product Development (NPD), studies cannot be disregarded, as they lay the foundations or act as a benchmark for researching NSD. On the other hand, the recent and limited research in NSD has been criticized for its methodological limitations and so, the generalizability and applicability of its ﬁndings are questionable. Indeed, ﬁndings of NSD studies either lack generalizability or are fragmented (Syson & Perks, 2004; De Bretani, 1991; Martin & Horne, 1995; Edvardsson, Haglund, & Mattsson, 1995). The majority of NSD studies are also product oriented, as they simply borrowed and used previous NPD models for empirically testing their applicability to a service context. Other studies solely focus on reviewing the literature and compiling NSD ﬁndings (Storey & Easingwood, 1996). As most NSD studies are at an embryonic stage without qualifying for coherent and consistent theory building, many researchers also highlight the need for further research developments in areas such as, service innovation opportunities and risks, as well as system design (e.g. Johne & Storey, 1998; Froehle, Roth, Chase, & Voss, 2000). Others (e.g. Froehle et al., 2000; Martin & Horne, 1993) argue the need to conduct more efﬁcient and

New Service Development

131

consistent NSD research due to its importance to quality and delivery outcomes (Tax & Stuart, 1997). Finally, as most NSD studies (e.g. Cooper & Kleinschmidt, 1995; Pinto & Pinto, 1990) have been carried out in ﬁnancial, health, transportation, telecommunications and wholesale services, it is clear that NSD in tourism and hospitality has received minimal attention, despite tourism’s increasing importance in several national economies (e.g. Orﬁla-Sintes, Crespi-Cladera, & Martinez-Ros, 2005). Given the urgency but general lack of research in NSD and speciﬁcally in hospitality, this paper aims to explore NSD in hotels by conducting a reality check and measurement of NSD processes adopted by Greek hotel companies. To achieve that, ﬁrst a review of the literature is undertaken analyzing and discussing the models – processes of NSD as well as the methods and metrics for measuring and assessing NSD processes’ outcomes. Qualitative data are gathered through in-depth interviews with hotel managers and ﬁndings provide useful practical and theoretical implications for future research.

MODELING AND ASSESSING NEW SERVICE DEVELOPMENT PROCESSES Modeling NSD Processes The academic community unanimously agrees that NSD models are modiﬁcations of the Booz-Allen and Hamilton (1982) NPD model (e.g. Alam & Perry, 2002), although its application in services has been questioned (e.g. Edvardsson et al., 2000 in Alam & Perry, 2002). In assessing and summarizing models describing the NSD efforts, Alam and Perry (2002) argued that the literature offers only two NSD models, namely: the Bower’s (1987) in Alam and Perry (2002) 8-stage sequential model and the Scheuing and Johnson’s (1989) in Alam and Perry (2002) 15-stage sequential model. However, as both models are derivatives of the Booz-Allen and Hamilton’s (1982) model in Alam and Perry (2002), their key stages can be summarized into idea generation, concept development, business analysis, prototype testing, market testing and commercialization (Tax & Stuart, 1997). Current research in NSD (Massa & Testa, 2004; Vermeulen, 2004) further contributes to academia not only by addressing and further improving on the limitations of past NSD models, but also by developing integrative approaches (namely, parallel design, supplier involvement, concurrent design),

132

MARIANNA SIGALA AND KALOTINA CHALKITI

which they emphasize and illustrate the fact that processes aiming to new service development are ad hoc in nature; do not need to be performed in a strict sequence of stages, but instead the process is beneﬁted when stages are performed in parallel and/or revised according to feedback gathered in other stages; and can be signiﬁcantly enhanced by integrating the feedback, contributions and participation of suppliers, customers and other ﬁrms’ stakeholders. However, the continuous high failure rate of new services (Cooper, Easingwood, Edgett, Kleinschmid, & Storey, 1994) is attributed to: the lack of an efﬁcient development process (De Bretani, 1991; Drew, 1995; Edgett, 1994); the lack of a market orientation (Gronroos, 1994; Martin & Horne, 1995); and the focus of the majority of NSD models to the design of successful encounters as opposed to delivering experiences (e.g. Menor, Tatikonda, & Sampson, 2002). Other researchers stress as major limitations of NSD processes the non-existent integration and communication between departments (Tax & Stuart, 1997), the lack of using parallel processing or cycle time reduction methods (Alam & Perry, 2002). Consequently, during the last six years, the following new NSD models have been developed embodying the previous mentioned limitations: Johnson et al.’s (2000) model in Alam and Perry (2002) featuring the following stages in NSD processes: development, analysis, design and full launch; Edvardsson et al.’s (2000) model in Alam and Perry (2002) that includes the following stages: service idea generation, service strategy and culture gate, service design and service policy, deployment and implementation; and Alam and Perry’s (2002) model including the following stages: strategic planning, idea generation, idea screening, business analysis, formation of a cross functional team, service design and process system, design, personnel training, service testing and pilot run, test marketing and commercialization. The Alam and Perry’s (2002) NSD model, is not only the latest model, but it also presents preliminary evidence of customer involvement in NSD. Their model also accepts both the sequential-linear and concurrent approach to NSD. The latter is very important for showing the scientiﬁc nature of NSD, as NSD is usually considered as an unsophisticated process whereby services happen because of intuition, fair, conjecture and luck (Levitt, 1981). This

New Service Development

133

ad hoc approach to NSD has been also previously conﬁrmed by Gronroos (1990), who found that in many situations new services just happen rather than derive, as an outcome of a rigorous, formal and planned process. Nevertheless, although Akamavi (2005) recently advocated that NSD should indeed follow an iterative process in order to ensure that customers and key staff from different supportive activities are involved in key aspects of NSD processes, he claimed that research is still required for examining these issues. Thus, although the ﬁndings of Alam and Perry (2002) may be deemed non-generalizable (as they mainly derive from the ﬁnancial industry), the previous arguments provide support for the validity and usefulness of their NSD model. Because of the previously analyzed value and fruitfulness of Alam and Perry’s model, their model was adopted in this study with the aim to further test and replicate it as well as investigate its value in the hotel industry.

NSD Measurement Measuring or assessing NSD is an extremely ambiguous and heavily researched subject with several rich and contradictory views. However, once these views are synthesized, an all-encompassing assessment tool can be developed (Table 1). Indeed, an extensive and critical review of the literature illustrated that NSD assessment studies measure NSD performance from three dimensions – prisms, namely: (1) the type and level of the innovation activity (performance assessment regarding the output of the NSD process); (2) an assessment of the new service(s) developed (performance assessment regarding the outcome of the NSD process) and (3) an assessment of the NSD process itself (performance assessment of the mechanism of the whole NSD process). A holistic NSD assessment requires the separate but also integrative assessment of all three dimensions, as each dimension has different scope and its own feedback value and usefulness. Speciﬁcally, assessing ﬁrms’ NSD output activity assists in determining its innovation capability and portfolio (i.e. number and type of innovations, e.g. radical, incremental, service or process focused) produced during a period of years. The ability of a company to generate innovations is vital as it indicates: whether ﬁrms obtain any return from their Research and Development investments; and whether ﬁrms need to invest on other and wider types of innovations so that they can have a more balanced innovation portfolio for improving their business performance. However, ﬁrms also need to assess the output of the NSD from their consumers’ perspective,

134

MARIANNA SIGALA AND KALOTINA CHALKITI

Table 1.

Assessing the Performance of New Service Development Processes.

Dimension 1. NSD output: type and level of innovation activity 2. NSD outcome: service

3. NSD process

Assessment Variables Number of new services or processes in the last X years How many services are a result of external, internal or mixed inﬂuence Modiﬁcation of service or process Service features; service advantage; technical quality; functional quality; innovative technology; service expertise; service intangibility; uniformity of service delivery process; quality of service delivery; ﬁnancial performance; intangibles Quality; intangibles; speed; project speed; project organization; project familiarity; idea generation assessment; initial screening; market assessment; technical assessment; detailed marketing study/ marketing research; business/ﬁnancial analysis; product development; in house product testing; trial production; production start up; market launch; monitoring and controlling

Authors Kleinschmidt and Cooper (1988, 1991)

Easingwood and Storey (1991, 1993)

Cooper and Kleinschmidt (1986), Kleinschmidt and Cooper (1991), Johne and Snelson (1988)

since a major aim of NSD is the satisfaction of the changing consumers’ demands. Hence, the outcome of NSD also needs to be assessed, i.e. the quality of new services and their capabilities and effectiveness in meeting consumer demands. This outcome dimension of NSD assessment highlights the fact that NSD processes need to be customer-oriented and customerfocused processes. Finally, ﬁrms’ ability to produce good NSD outputs and outcomes heavily depends on the processes generating them and so, ﬁrms also need to continuously assess the workings of their NSD processes. This latter dimension is valuable, as it can breed useful process feedback which can in turn support the ﬁrms’ effort for continuous NSD process improvement. Overall, assessing all three dimensions (i.e. NSD outputs, outcomes and processes) is imperative due to the substantially different perspectives from which they are examined and the different valuable feedback that they generated. For example, the service outcomes are primarily assessed from the customers’ perspective, while the NSD process from the ﬁrms’ view, i.e. cost reduction or time efﬁciency. Table 1 identiﬁes major studies examining the aforementioned NSD performance assessment dimensions. Table 1 also

New Service Development

135

provides the variables that are most frequently used for assessing each NSD assessment dimension.

METHODOLOGY Research Aims and Objectives This study aimed to examine the process and types of NSD activities and outcomes undertaken by Greek hotels. Speciﬁcally, the study aimed to explore the hotels’ NSD efforts by following a similar methodology as the De Long and Vermeulen’s (2003) study. In reviewing NSD efforts in several industries, the latter study did not only stress the overwhelm work conducted in the ﬁnancial and telecommunications industries, but it also highlighted the emerging attention toward new ways of innovation generation and speciﬁcally the increased focus on the involvement and role of external stakeholders in NSD. In this vein, the study aimed at replicating and enhancing De Long and Vermeulen’s (2003) propositions by testing it from a hotels’ perspective. To better address the research aim, the latter was further broken down into the following speciﬁc research objectives: 1. examine the procedure and development of NSD processes (i.e. formal vs. iterative procedure, explicit NSD department); 2. identify inhibitors and facilitators to NSD efforts undertaken by hotels and explore the formers’ inﬂuence; 3. determine the innovation activity of hotels (i.e. focus on service or focus on process); 4. explore the applicability of traditional NPD assessment techniques to hotels; 5. identify the key NSD activities – stages; 6. identify the sources of idea generation for new services; and 7. explore the role and contribution of the integration of different hotel departments in NSD can play in NSD processes. Design of the Research Instrument A questionnaire was designed to gather primary data that directly answered the abovementioned research questions. To ensure the content validity of the instrument and data the following steps were undertake. Content validity is not computed numerically but is subjectively judged by researchers.

136

MARIANNA SIGALA AND KALOTINA CHALKITI

It represents the adequacy with which a speciﬁc domain of contents is sampled and it is determined based on two criteria (Nunnally, 1978): (1) whether an instrument contains a representative collection of items and (2) whether a satisfactory method to test the instrument is used. To meet the ﬁrst criterion, content validity was established by reviewing an extensive literature and by using previously validated constructs. To satisfy the second criterion, the questionnaire was pilot tested with one expert and one hotel manager, whose feedback was very useful and used for adapting the terminology used in the questionnaire so that it is understood by the target audience. In this vein, the questionnaire was organized in sections representing the research objectives as well as gathering demographic information about the respondents’ proﬁle and type of the hotel they worked for. So, the questionnaire gathered data regarding: the hotel employee demographics, hotel characteristics, new service development process, new services portfolio, NSD activities, inhibitors or facilitators of NSD and metrics used for assessing NSD activities. For operationalizing the research constructs, metrics were adopted from previous studies (Table 2).

Sample Design and Targeting To get a representative sample, a stratiﬁed random sample was selected (Saunders, Lewis, & Thornhill, 2003) by using the ofﬁcial database of Greek hotels that is produced by the Greek Hoteliers’ Association. Previous studies have shown that hotel staff capable to shed light on NSD activities and its critical aspects included general managers, marketing executives or sales executives. Hence, initial contacts were made for identifying and establishing contact with one of these key holders of the study’s hotel sample. However, although the sample initially aimed to include all accommodation classes (5 star, 4 star, 3 star, 2 star, 1 star), this idea was soon abandoned, as the initial telephone calls revealed that staff from 3, 2 and 1 star hotels was not only unaware, but also refused to further help with this study. Statements such as ‘‘what is NSD’’ or ‘‘we are only a small company’’ dominated the majority of telephone conversations. Thus, because of this negative attitude, 5 and 4 star properties from all accommodation categories (e.g. hotel, furnished apartments) were contacted. A covering letter explaining the research process was e-mailed along with the research questionnaire to a sample of 150 5 and 4 star hotels. To further boost response rate, questionnaires were posted during February (low season for several hotels), while follow-up telephone calls were made for conﬁrming receipt of the

Research Variable Hotel employee demographics Educational background Employment: years and position held Hotel characteristics Size of hotel Hotel classiﬁcation Hotel management Inter-organizational collaboration NSD responsibility New service development process NSD stages Formalization of NSD Importance and role of departments in NSD

Measurement Construct

Educational level: high-school, vocational training, undergraduate level, postgraduate, PhD level Duration of occupation at current company: 0–5, 6–10, 11– 15, 16–20, 21–30, >30 years, position held at hotel Number of employees, number of hotel rooms/beds 5 star, 4 star, 3 star, 2 star, 1 star Ownership, franchise, leasing, other Hotel governance: consortia, chain of hotels Independent ownership, other Department of new service development

Open question Formal vs. emergent, reactive vs. proactive, process General management, events department, reception, restaurant – bar, ﬁnance, housekeeping, sales and marketing, human resources Radical or incremental innovation Percentage of new services or new processes Focus on service outcome and on development process

Author

Sveiby and Simons (2002)

Christensen (2005) Christensen (2005), Orﬁla-Sintes et al. (2005) Cillo (2005) Cillo (2005) Stevens and Dimitriadis (2004)

Alam and Perry (2002) Shulver (2005) Easingwood (1986), Stevens and Dimitriadis (2004)

137

Innovation portfolio Innovation typology Services vs. processes Management focus

Operationalization of Constructs.

New Service Development

Table 2.

138

Table 2. (Continued ) Research Variable NSD activities Sources of ideas

Sources of ideas

Measurement Construct

Employees, customers, external collaborators (e.g. tour operators), competitors, suppliers other Open question

NSD assessment Effectiveness of NSD

Evaluation method or means used to assess the service outcome and the development process: e.g. product features and advantage, technical quality, functional quality, innovative technology, service expertise, service intangibility, tangible evidence, uniformity of service delivery process, quality of service delivery Measures used to evaluate the service output and the NSD process: e.g. ﬁnancial, intangibles, project speed

Martin, Horne, and Schultz (1999), Easingwood (1986), Kelly and Storey (2000) Cooper and Kleinschmidt (1986) Te Yang and Wan (2004), Christensen (2005), Nonaka, Umemoto, and Senoo (1996), Koskinen (2003), Pinto and Pinto (1990) Kelly and Storey (2000); Nonaka et al. (1996), Christensen (2005) Davenport, De Long and Beers (1988), Christensen (2005), Sveiby and Simons (2002), Nonaka (1991) De Bretani (1991), Menor et al. (2002), Calantone and Di Benedetto (1988)

MARIANNA SIGALA AND KALOTINA CHALKITI

Inhibitors or facilitators of NSD HR practices Employee entrepreneurship, employee empowerment, employee target setting, staff turnover, team work, continuous staff training, cross-functional staff training, financial motivational factors, non-financial motivational factors, intradepartmental communication Infrastructure NSD department, technological infrastructure, resource availability (e.g. time, money, information) Culture Management commitment, risk tolerance, change adaptation

Author

New Service Development

139

questionnaire and answering any potential queries. Despite the great interest expressed by the majority of the targeted sample, most respondents failed to reply on time and so, only 10 usable questionnaires were received; all of the questionnaires were ﬁlled in by conducting in-depth telephone interviews.

DATA ANALYSIS AND DISCUSSION Due to the small number of responses and the open nature of two exploratory questions, statistical data processing was not appropriate. Table 3 summarizes the proﬁle of the respondents and of the accommodation enterprises at which respondents work for. Respondents represent university, well-educated and managerial level hotel staff working for relatively large hotels. Hotels are also located all over Greece, while they also represent independently owned and managed properties. These ﬁndings are not surprising relative to the characteristics of the Greek hotel sector (Christou, 1999; Sigala, 2005). The following section discusses ﬁndings regarding the NSD strategy and portfolio of the accommodation operators as well as respondents’ perceptions regarding: the facilitators and/or inhibitors of NSD efforts, NSD

Table 3.

Hotels’ and Employees’ Demographics.

Hotel demographics (number of hotel properties) Number of rooms Class Location of hotel Hotel management Ownership Employee demographics (number of respondents) Job title

Education Years at job

0–50 rooms (2); 101–150 rooms (3); 151–200 rooms (1); 251– 300 rooms (1); 301+ rooms (1) 4 stars (4); 5 stars (6) North Aegean (1); Cyclades (1); Mainland Greece (6); South Aegean (2) Owners (9); franchise (1) Independent ownership (6); consortia (2); chain (2)

Managing director (5), operations manager (1); assistant manager (1); sales manager (2); assistant marketing manager (1) Secondary (1); undergraduate studies (3); postgraduate studies (6) o1 year (1); 2–5 years (8); 6+ years (1)

140

MARIANNA SIGALA AND KALOTINA CHALKITI

activities and the NSD stages undertaken and the ways and metrics used for assessing NSD efforts.

NSD Strategy of Hotels In terms of hotels’ strategic attention to NSD efforts, ﬁndings focusing on the formalization, focus and the approach of the NSD process were extremely useful. The majority of hotels (8) characterized the process as emergent rather than formal, while only one hotel followed a descriptive process. Concerning the focus of the NSD process, the answers were equally spited. Half of the respondents reported that the offering (service) was mainly the focus and the unit of improvement for new services, as opposed to the other half who claimed that NSD mainly focused on the actual service processes. In terms of the NSD approach, only one enterprise claimed to follow a proactive approach to NSD, while the remaining nine characterized their approach as reactive to their external environmental changes. This was further corroborated by the comments received when respondents were asked to describe their NSD process. In doing this, most respondents described their NSD process with a starting stage aiming to identify the sources of New Services/Innovation ideas, which according to nine responses the external environment has a decisive inﬂuential source for idea generations. Although, such ﬁndings show that most hotels are trying to respond to external environmental trends, their NSD processes tend to be very reactive and ad hoc. Although, ad hoc rather than formal NSD processes seemed to be the rule in service contexts, reactive NSD approaches usually drive companies to simply imitate competitors rather than becoming innovation leaders. However, ad hoc NSD does not mean that ﬁrms cannot develop a NSD orientation and proactive strategic focus. Instead, hotels are advised to institutionalize and create an organizational climate that promotes and fosters staff empowerment and motivation to continuously assess their practices, scan the external and internal business environment and generate ideas for innovations.

New Services’ Portfolio A ‘‘healthy’’ portfolio balance is held by the majority (7) of the hotels, as they target to innovate both the service offerings and their processes. However, the minority (3 hotels) exclusively focus on process innovation. The

New Service Development

141

majority of the enterprises, reported to focus both on service and process innovation, were individually owned or part of a bigger hotel chain, while they were located on the geographical regions of mainland Greece and South Greece. In terms of radical vs. incremental innovation, the majority of hotels carry out incremental innovations in terms of improving or augmenting existing service lines. This ﬁnding reveals that hotels are generally risk averse and/or lack imagination, since they are somewhat reluctant in developing totally new services and immigrating from current and traditional practices.

Facilitators and Inhibitors The sample indicated entrepreneurship, empowerment, employee target setting, team working, staff training, intra-departmental communication, risk tolerance and change adaptation as the most critical factors facilitating and supporting NSD efforts. Such ﬁndings clearly highlight the importance of people in NSD, which is somewhat expected, as services are people-centered processes (involving simultaneous presence and contributions from staff and customers) in contrast to products whereby technology and material resources play a more important role in NPD. The importance of staff training that was reported is also not surprising, when considering that hotel staff in Greece is lacking critical skills and competencies (Christou, 1999). In juxtaposition, staff turnover, ﬁnancial or non-ﬁnancial motivational factors and the existence of a NSD department were considered as being partially unimportant factors for NSD processes. Respondents’ opinion regarding the limited role and importance of an NSD department is also in line with previous ﬁndings stressing the fact that NSD represents an ad hoc, iterative process that cannot be located and found in the solely duties of a speciﬁc department. Instead, ﬁndings and respondents highlighted that NSD is a shared iterative process that cuts across and needs the feedback and interaction-communication of several different departments and staff.

NSD Processes and Activities Respondents were asked to describe in their own words the process followed to develop a new service or process as well as to identify the key people involved in the process. Inferences were drawn from the responses in terms of the NSD stages followed by each enterprise and the metrics determining a

142

MARIANNA SIGALA AND KALOTINA CHALKITI

Table 4. New Service Developments. Hospitality Enterprises NSD stages Strategic planning Idea generation Idea screening Business analysis Cross functional team Service design and process Personnel training Service test Test marketing Commercialization

1

2

3

4

5

6

7

8

9

10

A B C

A B

A B

A

A B

A E D B C F

A B

A

A B C

A B

D

D

D

B C

C

G H

C

B C

go or no go decision. Table 4 presents in a tabular format the 10 NSD stages identiﬁed by Alam and Perry (2002) (horizontally) and the responses by the 10 hospitality enterprises (vertically). Alphabetic letters were used for showing the sequence of the stages followed. It becomes evident from ﬁndings in Table 4, that the majority of hotels identify mainly three stages to NSD (idea generation, screening and commercialization). This is not surprising when considering that in services it is very easy and fast to implement a new service (e.g. a new drink, a new dish, a new holiday packages) without the need to invest in substantial technology and resources. A more detailed justiﬁcation of the key activities, people involved or resources used at each stage of the Alam and Perry’s (2002) NSD model is presented in Table 5. The sources that respondents reported to use for generating NS ideas are also interesting. Findings revealed customers, employees and competitors to be considered as the most important ideas’ sources, while suppliers or other external collaborators (i.e. tour operators) as the least important sources. This is in contrast to ﬁndings from hotels in the Balearic Islands (Orﬁla-Sintes et al., 2005) that provided evidence of hotels’ innovation dependency on their suppliers. It is suggested that further cross-country and larger scale research is required to explore the impact of any cultural and contextual factors on the use and role of sources of NSD ideas. Respondents were also asked to indicate the hotel departments most heavily involved or more critical to NSD process. Findings revealed that the general management, reception, sales and marketing and the food–beverage departments were considered as the most critical to NSD efforts mainly due to their intense customer interactions and communications. Such ﬁndings

New Service Development

Table 5. NSD Stage Strategic planning Idea generation

Idea screening

Business analysis

Cross functional team

Service design and process

Personnel training

Service test

Test marketing Commercialization

143

Greek Hotels’ NSD Activities. Findings

Responses on this stage were extremely poor as only 1 out of 10 followed a prescriptive NSD approach Brainstorming, market research, questionnaires, personal contact and management meetings were the most frequently quoted tools and modes for developing ideas Ideas were always screened by the Managing Director in terms of their cost efﬁciency, ﬁnancial success potential, required labor to develop, and competition and in light of the customers’ acceptance Most enterprises carried out SWOT analysis, preliminary cost and labor projections while a small percentage mentioned the utilization of intuition or risk during this stage Only two hotels reported the appointment of speciﬁc teams and NSD project managers (both hotels were part of a hotel chain, had 5 star classiﬁcation, represented the highest rooms capacity and were located in mainland Greece). Although cross functional training was not reported as important, further corroborating of the ﬁndings showed that cross functional training was deemed partially important as an NSD facilitators In only one hotel (the one which indicated a prescriptive NSD strategic approach), the service or process to be developed was planned and designed (this hotel was part of a hotel chain, 5 star, located in mainland Greece, the respondent has been employed in the hotel for several years and his educational background feature a strong business minded person) None hotel mentioned the training of personnel for the purposes of NSD. Two hotels ensured the NSD project was marketed internally and that all team members received written instructions on their obligations and deliverables concerning NSD (both hotels were part of a hotel chain, percent stars, represented the highest rooms’ capacity, located in mainland Greece No formal service test activity is carried out. The majority of respondents mentioned that once a service is commercialized it is pilot tested for a whole tourist season (usually six months), as it is difﬁcult to remove the service before the end of the season even if the new service is not proﬁtable (e.g. reservations, pre-payments, contracts may have been made) This stage is skipped according to respondents’ comments Most enterprises revealed that a service ﬁrst goes public and then, depending on the general acceptance it receives, marketing efforts are carried out

144

MARIANNA SIGALA AND KALOTINA CHALKITI

indirectly conﬁrmed again a previous conclusion, since they imply that customers’ are considered as one of the most important source of NSD idea generation. NSD Performance Assessment Findings regarding NSD performance assessment are presented based on the previously analyzed threefold approach: innovation activity, service/ process and development process assessment. All respondents claimed that they assessed NSD from all three dimensions. Speciﬁcally, eight hotels develop extensions or improvements to their service offerings, out of which three plus the remaining two hotels of the sample reported to develop innovative services as well. Hotels claim to assess NSD output also in comparison to employees’ achieved targets or goals, ﬁnancial ﬁgures (sales, proﬁt and adherence to development budget) and the extent of its modiﬁcation to existing services/processes. Furthermore, hotels reported to assess NSD outcome (service or process) in terms of customers’, tour operators’ acceptance and satisfaction levels. Additionally, hotels claimed to assess the processes of NSD through the prism of time, cost, employee acceptance and process standardization. Finally, most hotels reported to use questionnaires, personal contact, market research, consultation and setting of targets, as the mechanisms for measuring the aforementioned performance dimensions.

CONCLUSION AND IMPLICATIONS OF THE FINDINGS This study aimed to examine and assess the process and types of NSD in the Greek hotel sector. Owing to limited time and hotels’ willingness to respond, a convenience sample of 10 hotels was investigated through in-depth telephone interviews. In summarizing the ﬁndings, it is evident that NSD efforts reported by the respondents are at low level regarding their radical innovation outputs and process development. Coupled with the professional experience of the researchers, this study suggests that consistent and persistent efforts need to be made, if Greek hotels wish to compete in the highly dynamic global tourism industry. Findings however conﬁrmed the fact that NSD within the service context are people-focused and depended, as well as ad hoc cross-functional processes. For these reasons, NSD processes require extensive team working, communication, staff training and empowerment.

New Service Development

145

Indeed, also according to respondents’ claims regarding the most critical NSD facilitators, the importance of soft issues such staff motivation, empowerment and organizational culture are and should be at the forefront of today’s innovation economy. These issues should also serve to advertence the rigid, centralized and autocratic management styles of traditionally managed hotels. Findings have also illustrated that the NSD approach that the investigated hotels adopt is an out–in perspective, whereby the external environment dictates their innovation activity. Stemming from this reactive NSD approach, it is not surprising that ﬁndings revealed that all new services or processes derive from ad hoc approaches. However, as previously debated the ad hoc NSD and the creation of a proactive NSD strategic orientation should not be viewed as mutually exclusive. Hotels need to create an organizational culture and a strategic commitment that fosters innovation, accept errors, empowers staff and supports intrapreneurship. Customers were also found to be considered as the hotels’ major source for generating new services’ ideas. This ﬁnding justiﬁes in turn respondents’ claims regarding the crucial NSD role of front-ofﬁce personnel and processes. In general, ﬁndings provide preliminary evidence of the vital role that departments with customer encounters play in NSD. On the other hand, as it is recognized that valuable customer information enters the organization at the front-ofﬁce departments and customer encounters, equally important is to investigate whether and how this information gets diffused, communicated and used both horizontally and vertically within hotel organizational structures. This is because failure to further share and analyze such customer information may result in being unused (Zahay, Grifﬁn, & Fredericks, 2004). Indeed, customer intelligence and participation in NSD are issues that need further in-depth investigation within the service sector. By comparing Greek hotels NSD key activities with those identiﬁed by Alam and Perry (2002), it becomes clear that Greek hotels bypass and ignore many important NSD stages. A key ﬁnding is the non-existent work and pilot tests that should be carried out before a new service or process is launched in order to primarily minimize the possibilities of customer dissatisfaction and NS failure. Furthermore, the subjective screening processes of new ideas that were reported to be followed (i.e. ideas screening was mainly done by the hotel managing director) may be risky and dangerous for the hotel strategy but also for staff motivation, unless the managing director is extremely fair, charismatic and knowledgeable. Moreover, ﬁndings revealed that NSD efforts are not viewed as a vital hotel project in itself that demands exclusive resources and business commitment, such as,

146

MARIANNA SIGALA AND KALOTINA CHALKITI

a project manager, a special department and/or employees. Rather it is viewed as a process being added to the daily activities of the hotel staff and obvious task that has to be carried out. Although such an iterative NSD approach empowers staff to generate ideas and deliver NSD, it also stresses the lack of respondents’ ability to recognize the strategic importance of NSD and the commitment (e.g. in resources, organizational learning and culture, training) that the hotel has to provide. On the contrary, it is widely accepted that empowering staff with NSD roles is due to fail, should this transfer of duties and roles is not accompanied with the provision of appropriate skills’ training and development as well as other resources needed to carry out the new NSD roles. In this vein, implementation of NSD both at a daily operational and at a business strategic level is an additional business issue that needs careful attention. Finding the balance between the two implementation levels may not be an easy task, but it is certainty something that needs to be examined further. Regarding NSD performance assessment, it is interesting to note that ﬁndings revealed the use and measurement of all three NSD performance dimensions by all responding hotels. However, hotels’ NSD assessment processes are limited when considering that the majority of respondents’ focused on the measurement of hard metrics, e.g. cost and labor resources used, while respondents did not report to consider and assess the importance and use of soft factors such as information gathered, knowledge and learning generated from customer participation and NSD processes. This is disappointing, as according to various publication and research ﬁndings (e.g. Vermeulen, 2004), soft factors are the key and most decisive resources and factors for NSD processes in general, but more importantly in the service sector. Finally, although steps have been taken by other service industries (e.g. ﬁnancial or telecommunications) to create an innovative climate and become market oriented by actively involving in NSD not only customers but also suppliers, competitors, other collaborators and employees, Greek hospitality enterprises seem to be catching up, but very slowly. Although respondents demonstrated a high awareness level about the beneﬁcial effects in involving customers, competitors and employees in NSD, respondents disregarded the importance that suppliers could have in terms of NSD generation, process improvement and efﬁciency. Owing to the small size of this sample, research ﬁndings cannot be generalized. However, ﬁndings provide useful guidelines and issues for future research. It is suggested that future studies would further try to investigate the ad hoc processes of NSD and to unravel the role of knowledge collection

New Service Development

147

and management processes (e.g. customers’, suppliers’ and employees’ intelligence) that can be used for supporting and enabling NSD processes. Indeed, although there is strong evidence from past studies in other sectors about the beneﬁcial inﬂuence of external stakeholders (suppliers, competitors, etc.) on NSD efforts, studies and in-depth exploration of the issue in the hotel and tourism sector is scant. Future research should also try to gather more in-depth qualitative data regarding the NSD operational and strategic processes as well as the role of key stakeholders in NSD in hospitality. Finally, studies should also try to replicate and test ﬁndings in a larger scale and multi-cultural sample, as contextual and environmental factors (e.g. political) can signiﬁcantly inﬂuence and bias research ﬁndings.

REFERENCES Akamavi, R. (2005). A research agenda for investigation of product innovation in the ﬁnancial services sector. Journal of Services Marketing, 19(6), 359–378. Alam, I., & Perry, C. (2002). A customer oriented new service development process. Journal of Services Marketing, 16(6), 515–534. Calantone, R., & Di Benedetto, A. (1988). An integrative model of the new product development process: An empirical validation. Journal of Product Innovation Management, 5(3), 201–215. Christensen, K. (2005). Enabling intrapreneurship: The case of a knowledge intensive industrial company. European Journal of Innovation Management, 8(3), 305–322. Christou, E. (1999). Hospitality management education in Greece: Overview and qualitative assessment. Tourism Management, 20(6), 683–691. Cillo, P. (2005). Fostering market knowledge use in innovation. European Management Journal, 23(4), 404–412. Cooper, R., Easingwood, C., Edgett, S., Kleinschmid, T., & Storey, C. (1994). What distinguishes the top performing new products in ﬁnancial services. Journal of Product Innovation Management, 11(4), 281–299. Cooper, R., & Kleinschmidt, E. (1986). An investigation into the new product process: Steps, deﬁciencies and impact. Journal of Product Innovation Management, 3(2), 71–85. Cooper, R., & Kleinschmidt, E. (1995). Benchmarking the ﬁrms critical success factors in new product development. Journal of Product Innovation Management, 12(5), 374–391. Davenport, T., De Long, D., & Beers, M. (1988). Successful knowledge management projects. Sloan Management Review, 33(2), 43–57. De Bretani, U. (1991). Success factors in developing new business services. European Journal of Marketing, 25(2), 33–59. De Long, J., & Vermeulen, P. (2003). Organising successful new service development: A literature review. Management Decision, 41(9), 844–858. Drew, S. (1995). Accelerating innovation in ﬁnancial services. Long Range Planning, 28(4), 1–10. Easingwood, C. (1986). New product development for service companies. Journal of Product Innovation Management, 3(4), 264–275.

148

MARIANNA SIGALA AND KALOTINA CHALKITI

Easingwood, C., & Storey, C. (1991). Success factors for new consumer ﬁnancial Services. International Journal of Bank Marketing, 9(1). Easingwood, C., & Storey, C. (1993). Marketplace success factors for new ﬁnancial services. Journal of Services Marketing, 7(1). Edgett, S. (1994). The traits of successful new service development. Journal of Services Research, 8(3), 40–49. Edvardsson, B., Haglund, L., & Mattsson, J. (1995). Analysis, planning, improvisation and control in the development of new services. International Journal of Service Industry Management, 6(2), 24–35. Froehle, C., Roth, A., Chase, R., & Voss, C. (2000). Antecedents of new service development effectiveness: An exploratory examination of strategic operations choices. Journal of Services Research, 3(1), 3–17. Gronroos, C. (1990). Service management and marketing. Lexington, MA: DC Health & Company. Gronroos, C. (1994). From scientiﬁc management to service management: A management perspective for the age of service competition. International Journal of Service Industry Management, 5(1), 5–20. Gustafsson, A., Ekdahl, F., & Edvardsson, B. (1999). Customer focused service development in practice: A case study at SAS. International Journal of Service Industry Management, 10(4), 344–358. Johne, A., & Snelson, P. (1988). Success factors in product innovation: A selective review of the literature. Journal of Product Innovation Management, 5(2), 7–21. Johne, A., & Storey, C. (1998). New service development: A review of the literature and annotated bibliography. European Journal of Marketing, 32(3/4), 184–251. Kelly, D., & Storey, C. (2000). New service development: Initiation strategies. International Journal of Service Industry Management, 11(1), 45–63. Kleinschmidt, E., & Cooper, R. (1988). The performance impact of an international orientation on product innovation. European Journal of Marketing, 22(10). Kleinschmidt, E., & Cooper, R. (1991). The impact of product innovativeness on performance. Journal of Product Innovation Management, 8(4), 240–251. Koskinen, K. (2003). Evaluation of tacit knowledge utilisation in work units. Journal of Knowledge Management, 7(5), 67–81. Levitt, T. (1981). Marketing intangible products and products intangibles. Harvard Business Review, 50(May/June), 95–102. Martin, C., & Horne, D. (1993). Services innovation: Successful vs. unsuccessful ﬁrms. International Journal of Service Industry Management, 4(1), 49–65. Martin, C., & Horne, D. (1995). Level of success inputs for service innovations in the same ﬁrm. International Journal of Service Industry Management, 6(4), 40–56. Martin, C., Horne, D., & Schultz, A. (1999). The business to business customer in the service innovation process. European Journal of Innovation Management, 2(2), 55–62. Massa, S., & Testa, S. (2004). Innovation or imitation? Benchmarking: A knowledge-management process to innovate services. Benchmarking: An International Journal, 11(6), 610–620. Menor, L., Tatikonda, M., & Sampson, S. (2002). New service development: Areas for exploitation and exploration. Journal of Operations Management, 20(2), 135–157. Montoya-Weiss, M., & Calantone, R. (1994). Determinants of new product performance: A review and meta-analysis. Journal of Product Innovation Management, 11(5), 397–417.

New Service Development

149

Nonaka, I. (1991). The knowledge creating company. Harvard Business Review, 69(November– December), 96–104. Nonaka, I., Umemoto, K., & Senoo, D. (1996). From information processing to knowledge creation: A paradigm shift in business management. Technology in Society, 18(2), 203–218. Nunnally, J. (1978). Psychometric theory. New York, NY: McGraw-Hill. Orﬁla-Sintes, F., Crespi-Cladera, R., & Martinez-Ros, E. (2005). Innovation activity in the hotel industry: Evidence from Balearic islands. Tourism Management, 26(6), 851–865. Pinto, M., & Pinto, J. (1990). Project team communication and cross functional cooperation in new product development. Journal of Product Innovation Management, 7(3), 200–212. Saunders, M., Lewis, P., & Thornhill, A. (2003). Research methods for business students. London: FT Prentice Hall. Shulver, M. (2005). Operational loss and new service design. International Journal of Service Industry Management, 16(5), 455–479. Sigala, M. (2005). Integrating customer relationship management in hotel operations: Managerial and operational implications. International Journal of Hospitality Management, 24(3), 391–413. Stevens, E., & Dimitriadis, S. (2004). New service development through the lens of organisational learning: Evidence from longitudinal case studies. Journal of Business Research, 57(10), 1074–1084. Storey, C., & Easing Wood, C. (1996). Determinants of new product performance: A study in the ﬁnancial services sector. International Journal of Service Industry Management, 7(1), 32–55. Storey, C., & Easingwood, C. (1999). Types of new product performance: Evidence from the consumer ﬁnancial services sector. Journal of Business Research, 46(2), 193–203. Sveiby, K., & Simons, R. (2002). Collaborative climate and effectiveness of knowledge work – an empirical study. Journal of Knowledge Management, 6(5), 420–433. Syson, F., & Perks, H. (2004). New Service Development: A network perspective. Journal of Services Marketing, 18(4), 255–266. Tax, S., & Stuart, I. (1997). Designing and implementing new services: The challenges of integrating service systems. Journal of Retailing, 73(1), 105–134. Te Yang, J., & Wan, C. (2004). Advancing organisational effectiveness and knowledge management implementation. Tourism Management, 25(5), 593–601. Vermeulen, P. (2004). Managing product innovation in ﬁnancial services ﬁrms. European Management Journal, 22(1), 43–50. Zahay, D., Grifﬁn, A., & Fredericks, E. (2004). Sources, uses and forms of data in the new product development process. Industrial Marketing Management, 33, 657–666.

THE INFLUENCE OF THE INTENSITY OF COLLABORATION AND TYPE OF MANAGEMENT ON THE PERFORMANCE OF SWISS HOTELS Thouraya Gherissi Labben and Andrew Mungall ABSTRACT Following increasing competition on the international tourism market, a great number of Swiss hotels which are generally family businesses with small structures and aging infrastructures, find themselves in a critical financial situation. Thus, many hotels having exhausted their economic potential, cannot adequately upgrade their performance. For this reason they are forced to respond to the requirements of potential investors by presenting the progress of their activities through models of cooperation with other hotel establishments and/or other actors. In view of the significance of this issue, the present article proposes to study the effect of collaboration intensity and the type of management on the performance of Swiss collaborating hotels. By adopting a global approach to performance, it appears that hotel performance is influenced by the intensity of collaboration. Regarding the effect of the type of management the results are more questionable.

Advances in Hospitality and Leisure, Volume 3, 151–172 Copyright r 2007 by Elsevier Ltd. All rights of reproduction in any form reserved ISSN: 1745-3542/doi:10.1016/S1745-3542(06)03009-8

151

152

THOURAYA GHERISSI LABBEN AND ANDREW MUNGALL

INTRODUCTION The ﬁrst initiatives of inter-business collaboration,1 independent of their level of strength or form, were undertaken primarily by large industrial companies at the end of the 1980s. This collaboration represented strategies of internationalization for businesses active in consolidated markets, beginning long-term globalization with increasing international competition. Their main objective was to advance on the economic scale by increasing the volume of production and to generate better value for the client. In the service sector, these types of initiatives did not appear signiﬁcantly until the mid-1990s (Prosser, 1997). In fact, this sector, notably in the area of tourism, was characterized by low degree of consolidation and weak concentration. With globalization swelling markets, merely being reactive is not adequate enough to maintain competition. Allying oneself to other partners is becoming indispensable to survive. Taking this into account, and as small- and medium-sized enterprises (SMEs) are characterized by having limited and tight resources, one can see that small structures draw extensively on cooperation to overcome their resource shortages and improve their viability during times of crisis. However, recent studies show that SMEs have signiﬁcantly less tendency to cooperate than larger companies (Hoffmann & Schlosser, 2001; Kotey, 2005). Nevertheless, concerning the collaborating SMEs research seems to show a positive effect of collaboration on performance, whatever the approach used to measure the latter. However, the level of performance reached by the collaborating ﬁrms is inﬂuenced by several factors and prerequisites. One of the main inﬂuencing factors is the relationship intensity between ﬁrms who are cooperating. Covering several dimensions such as commitment, trust, frequency of the relations, etc. different researches have proven that higher the intensity of the relationship the higher is the performance (Gulati, Nohria, & Zaheer, 2000; Echols & Wenpin, 2005). Besides, strategic alliance practices are reﬂections of managers’ characteristics and perceptions (Pansiri, 2005, p. 1097). At the same time, different studies seem to show that the differences in types of management practices result in different performance outcomes (Donckels & Frohlich, 1991; Kotey, 2005). Given this, we could consider that these above characteristics have an impact on the level of performance reached by the collaborating enterprise. The objective of the article is to study the performance of collaborating ﬁrms in the speciﬁc context of the Swiss hospitality sector comprising mostly small units, where the owner and the manager are often the same person, and among which collaboration represents a new issue. As these speciﬁcities

The Intensity of Collaboration and Type of Management

153

are not theoretically associated with high performance, this article intends to analyze the inﬂuence of the intensity of collaboration and the type of management2 on the level of performance of collaborating hotels.

LITERATURE REVIEW Cooperation in the Swiss Hotel Sector: Situation and Evolution In Switzerland, as in the majority of industrialized Western European countries, hotel operators are primarily small- or medium-sized businesses. In 2003, practically 63% of hotels had 20 rooms or less, while 26% had between 21 and 50 rooms (Fe´de´ration Suisse du tourisme, 2005). The small size of these Swiss hotel establishments, associated with a mainly domestic and saturated market, do not facilitate the internationalization process through afﬁliation considered as a form of cooperation.3 In fact, although the share of afﬁliated rooms is continuously increasing, it is limited to around 36% (Marvel, 2001). Three quarters of these latter rooms belong to voluntary chains (marketing groups). Furthermore, most hotels represent independent, family type businesses, with an aging infrastructure. Individually, their efforts to survive in a globalizing market are insufﬁcient. Many small- and medium-sized independent hotels are often caught in a vicious cycle: shifting investments, falling proﬁts and increasing debts. For a hotel conducting business alone, it becomes increasingly difﬁcult to break out of this cycle. It is worth noting that the number of hotels dropped from 6,900 in 1992 to 5,600 in 2003 (Fe´de´ration suisse du tourisme, 2005). Thus, many hotels, after having exhausted all their available savings, are not able to improve their performance without additional funds. In this case they must lure investments by developing their activities in cooperation with other hotels and/or tourist operators, which will permit them to effect economies of scale and scope. This being said, the cooperation experience among Swiss hoteliers, whatever the type of partner concerned by the cooperation, and its form, is only at a starting point. The reluctance to cooperate found among many hoteliers is related mainly to the fear of losing control of their respective establishments and to the uncertainty about the real advantages coming from the cooperative process. Effect of the Intensity of Collaboration on a Firm’s Performance A great deal of work has been done on success and failure factors of cooperation. Generally, the lack of success, or failure of collaboration, is

154

THOURAYA GHERISSI LABBEN AND ANDREW MUNGALL

mainly treated from a theoretical point of view (Kogut, 1988; Schrader, 1993). However, few authors have grappled with the problem of factors in the success of collaboration in a purely empirical way (Dyer & Nobeoka, 2000; Harbison & Pekar, 1998; Park & Ungson, 1997). Generally speaking, the main aim has been to identify antecedent conditions and emergent processes that can inﬂuence performance (Pansiri, 2005). These particular inﬂuencing factors comprise, among others, questions related to cooperation progress (Harper, 2001), strength of cooperation, autonomy and ﬂexibility (Bleeke & Ernst, 1991). With regard to the intensity of cooperation, Dyer and Singh (1998) showed that transactional outcomes as well as ﬁrmlevel competitive advantages are improved when the relationship between partners is frequent and intense. A similar result showing that the strength of alliances expressed in terms of experience with a partner has a higher positive effect on alliance performance has been recently found by Zollo, Reuer, and Singh (2002). Frey (2002) focused on the network of small- and medium-sized businesses in the Swiss hotel industry, covering the organization and realization of inter-business cooperation. This study found that the partnership between Swiss hotels is not yet at the level it should be, nor is it fully generating added value. Frey insists on the necessity of reinforcing the intensity of partnership between hotels. According to him, the majority of these hotels see the process of collaboration, whatever its style or form, as purely a means of allowing their advertising campaign to reach more customers. Collaboration should also involve the pooling of internal resources of involved businesses to obtain further cost savings. However, many barriers still exist at this level, notably the refusal to surrender autonomy and the lack of a true desire to share information and communicate with potential business partners. In the future, Frey feels that it will be easier for hotels in Switzerland to ﬁrst participate in regional cooperation, a grouping of several hotels in the same region, because this proximity will allow hotels to better manage the collaboration process. Bieger was also interested in the problems of collaboration in the Swiss tourism and hospitality sector. One of his latest contributions deals with the success of the process of collaboration (Bieger, Beritelli, & Weinert, 2004). This study presents the real beneﬁts taken from complex processes of cooperation as being relative to synergies resulting from an intense collaboration on several different managerial levels. The processes of cooperation may often come to a halt during the early stages, due to poor management of the process. In this case, efforts should be intensiﬁed to implicate several different levels of management. In the case of businesses situated in Swiss ski

The Intensity of Collaboration and Type of Management

155

resorts, these authors use statistics to show that businesses with cooperation on various levels of management achieve beneﬁts and results superior to other businesses who do not participate in this type of cooperation. In general, there are a high number of studies concerning cooperation and strategic alliances. However, only very few have yet concentrated on the issue of the role of cognition of decision makers in the whole strategic alliance process, despite that strategic alliance practices are reﬂections of managers’ characteristics and perceptions (Pansiri, 2005). Effect of Type of Management on a Firm’s Performance ‘‘Founders, as ﬁrm creators, are the initial architects of the organization’s structure and strategy. In this role they hold a vision of what they want the organization to be, and they are generally unconstrained by previous ways of doing things.’’ (Robbins, 2000, in Nelson, 2003, p. 707). Nevertheless, the founder may not always be the person managing and controlling the ﬁrm. Moreover, the founder may not always be the current owner (which could be a family). To complicate the picture further, an owner could delegate the management of his ﬁrm to an employed manager. As there are several forms of ownership and different potential persons who could manage the ﬁrm, this results in different types of management and consequently in differences in the ﬁrm’s performance. Several studies analyzed the relation between the type of management and the ﬁrm’s performance. For example, many authors examined the link between founders and ﬁrm performance and activity. Kaish and Gilad (1991) found that managers differ from entrepreneurs when searching for opportunities. Entrepreneurs have a much more active approach in that respect. Chandler and Hanks (1998) suggested that the knowledge gained from education and experience is unequally distributed between individuals. In such cases, opportunity identiﬁcation and exploitation are different between the various types of managers. Further, Daily and Dalton (1992) observed that ﬁrms which are small founder-managed ones are performing better ﬁnancially than professionally managed ones. Other studies have been undertaken on the same subject; for example, those of Cooper, Gimeno-Gascon, and Woo (1994), Chandler and Hanks (1994, 1998), McGee, Dowling, and Megginson (1995) and Feeser and Willard (1990). In all the above empirical studies the deﬁnition of founder is either absent or varies by author (Nelson, 2003, p. 708). Wahlgre´n and Stewart (2003) focused on the differences in managerial work between owner-managers and employed managers. This difference

156

THOURAYA GHERISSI LABBEN AND ANDREW MUNGALL

may come from the size of the ﬁrm and the resource base, but also from the ownership structure of the business. The main characteristic of a manager who owns a business is the absence of control of his activities by a third party. ‘‘This positional condition means, above all, that owner-managers do not have to explain and justify their decision and choices, but feel that they are in control of their own destiny. The dual position, as owner and as manager, increases and intensiﬁes the legal, economic and moral responsibilities perceived’’ (Wahlgre´n & Stewart, 2003, p. 25). Furthermore, the psychological ownership, high commitment and the emotional relation with the ﬁrm are important. For all these reasons, owner-managers are generally signiﬁcantly implicated in the different stages of the business (Kets de Vries, 1995). On the other hand, when the manager of the ﬁrm is not its owner, the objectives of the owner and the manager may diverge as suggested by the agency theory. ‘‘The manager may behave opportunistically by pursuing the short-term objective to increase its own wealth, instead of the long-run growth of the ﬁrm’’ (Cosh, Fu, & Hughes, 2005, p. 5). Thus, under this context the owner needs to put into place a monitoring system in order to control the actions of the manager with little or no ownership interest in the ﬁrm to ensure that the interest of the owners is pursued (Kotey, 2005, p. 17). When a ﬁrm is managed by the owner, this agency problem may be greatly reduced as the manager’s objectives are consistent with those of the owner. However, in the case of smaller private ﬁrms, the main goals of the owner-managers may sometimes be other than ﬁnancial proﬁtability and wealth accumulation (Barton & Matthews, 1989; Poutxiouris, 2003). Pansiri (2005) has provided a linkage between strategic alliance practice and managerial cognitive base with a view to understanding alliance dynamics better. He argued that the inﬂuence of managers’ characteristics and perceptions in strategic alliance practice is not only limited to reasons why ﬁrms form strategic alliances and attitudes toward alliances. They also inﬂuence an array of practices which determines not only the survival of the strategic alliance but also the survival of the ﬁrm in question.

Measurement of Collaboration Effect on a Firm’s Performance Measuring the success of collaboration is complex. To remedy this, certain authors measure the ﬁrm’s performance in terms of the increase of share value (McConnell & Nantell, 1985) and others in terms of rate of growth of the ﬁrm (Powell, Koput, & Smith-Doerr, 1996). This said, Gulati (1998) as

The Intensity of Collaboration and Type of Management

157

well as Kale, Dyer, and Singh (2002) warn against the use of ﬁnancial and accountancy indicators for that purpose. According to them, ﬁnancial performances are obtained by other means. These do not only reﬂect the added value of collaboration. In this way, some other authors suggest other types of measures. For example, certain studies consider the longevity of a partnership as a benchmark to success, while others measure the contribution of collaboration to the improvement of the strategic position or competitiveness of ﬁrm partners (Hagedoorn & Schakenraad, 1994; Mitchell & Singh, 1996). Others measure it in terms of rate of survival of businesses on the market (Baum & Oliver, 1991; Mitchell & Singh, 1996). In the case of studies applied to the collaboration between high-technology businesses, the performance indicator generally used is the degree of innovation (Hagedoorn & Schakenraad, 1994; Stuart, 2000; Baum, Calabrese, & Silverman, 2000). Nevertheless, recent research has used such objective measures less often, but has focused more on the manager’s perception of performance (Pansiri, 2005). Such approaches favor a broad deﬁnition of performance, covering objective and subjective measures. However, it is important to note that there is no consensus on the dimensions of business performance (Fadil, 2003). The most general notion on performance is that of Pennings and Goodman (1977). Three dimensions characterize this approach: 1. Constraints: These represent the requirements which small- and mediumsized businesses need to meet. Any inability to satisfy them is seen as an inability of SME to perform. 2. Objectives: These concern the future state of business set by the manager (Bamberger, 1979), standards based upon which he ﬁxes his evaluation criteria. 3. Referential: These are used as measuring scale of performance as evaluated by SME managers. However, although a positive inﬂuence seems to exist between collaboration and business performance, a deﬁned relationship of causality has not yet been established since the competitiveness of a ﬁrm is inﬂuenced by many other factors (Observatoire des PME europe´ennes, 2003). Moreover, some of these factors are also difﬁcult to quantify. In addition, with the exception of studies mentioned above, very few studies covering a large sample of businesses have shown that collaboration is advantageous for the participating ﬁrms (Stuart, 2000). Thus, the question of the real advantages of business collaboration for ﬁrms remains to be examined.

158

THOURAYA GHERISSI LABBEN AND ANDREW MUNGALL

METHOD Far from the ambitious objective to clearly establish a causality relationship between the level of performance and the intensity of collaboration on the one hand, and the type of management on the other hand, this study aims to identify the inﬂuence of the two characteristics on the performance of collaborating Swiss hotels. Within this framework, the concept of performance in this study refers to the model of Pennings and Goodman (1977). Indeed, the study is based mostly on qualitative criteria (or factors), covering many more aspects related to collaboration. Thus, the spectrum of the effect of collaboration on the ﬁrm goes beyond the mere quantitative measure of performance. As performance criteria are mainly of qualitative nature, these criteria are measured by the way they are perceived by hotel managers. This perception is measured via a questionnaire. The latter covers the three dimensions of performance measurement detailed by Pennings and Goodman. Here, these dimensions are represented in the following manner: Constraints are considered as factors of the internal performance of the hotel. These cover the internal resources of the establishment (personnel, technology, etc.) and its internal management, as well as the characteristics of management of the hotel manager. Objectives are represented by the performance factors relative to the external environment of the hotel, especially those in relation with market competition (differentiation levels, price levels, etc.). Referential used are relative to some quantitative results reﬂecting the level of business activity. Thus, the conceptual framework of the study can be summarized as follows (Fig. 1): This questionnaire was tested by a certain number of experts in the ﬁeld of Swiss hotel collaboration. This test was instrumental in retaining, for the questionnaire, only the performance factors judged as pertinent by the experts: 27 factors were selected in this way; 15 of them relate to the dimension of constraints, 7 concern the dimension of objectives and 5 the dimension of referential. The hotels’ perception of their performance comprised under the dimensions of constraints and objectives is measured by the Likert’s 5-level scale. However, for reasons of simplicity for the respondents, two performance factors linked to the constraints dimension have different scales of measurement. The ﬁrst related to the investment needs is measured by a 3-level scale, while the second which is relative to the manager’s degree

Constraints

Performance factors

INTERNAL RESOURCES GROUP -Employee professional qualifications / -Website level - Scope of the distribution network - Efficiency of the distribution network -Hotel infrastructure - Technological equipments/ -Investment needs INTERNAL MANAGEMENT GROUP - Procurement management / -HR management - General administrative management STATE OF MIND/MOTIVATION DIMENSION -Time for strategic reflection - Manager open-mindeness/ -Degree of control -Employee open-mindness -Trust in the future of the branch

Influencingvariables

Collaboration intensity Type of management

Objectives

Referential *

DESTINATION GROUP -State of the destination’s infrastructure -Supply diversity of the destination HOTEL vs. MARKET COMPETITION GROUP - Degree of market competition–Differentiation level -Price level compared to the competitors -Advertising visibility/ -Financial situation

-% lodging turnover -% F&B turnover -% salary costs -% merchandise costs-% operational result II

Qualitative factors (performance perception) Quantitative factors (performance based on figures) *The percentages are calculated on the basis of the yearly turnover

159

Fig. 1. Conceptual Framework.

The Intensity of Collaboration and Type of Management

Performance dimensions (Pennings & Goodman, 1977)

160

THOURAYA GHERISSI LABBEN AND ANDREW MUNGALL

of control of the establishment is measured by a 4-level scale. For the referential dimension the factors of performance are measured quantitatively in terms of percentages in turnover of certain results. Furthermore, other independent variables were included and are related to the characteristics of collaboration and those of the establishment. The questionnaire was put on line in June 2005 and the 2000 members of Hotelleriesuisse, the Swiss national hotel association, who have electronic addresses, were invited to respond. The exercise was then repeated. Exactly 123 questionnaires were received. To ﬁt into the speciﬁc objectives of this article, only 98 questionnaires were valid. Finally, the study used the analysis of the univariate analysis of variance (ANOVA), to identify the factors of performance inﬂuenced by intensity of collaboration, which is composed of two possible answers ‘‘weak’’ and ‘‘strong,’’ and the type of management covering two categories which are: ‘‘owner-manager’’ and ‘‘employed manager.’’ The multivariate analysis of variance (MANOVA) showed that the effect of the interaction between the two inﬂuencing variables is not signiﬁcant.

RESULTS Description of the Respondent Sample The sample of responding hotels is generally representative of the Swiss hotel population according to the hotel category (see Fig. 2). Nevertheless, it is to be observed that there is a certain overrepresentation of ﬁve-star hotels while two-star hotels are underrepresented. In terms of the number of rooms, 85% of the answering hotels have between 11 and 20 rooms. This distribution is thus more concentrated than in the Swiss hotel population (see Fig. 3), increasing the homogeneity of the sample in terms of size and the internal organization. The distribution of hotels is less homogeneous when other speciﬁcities such as location, season and the turnover level of the hotel are considered. In terms of location, mountain hotels represent a little more than 35% while 21% are found in the ﬁve largest Swiss cities. The other hotels are distributed between other cities and the countryside, making up 26 and 14%, respectively. Therefore, it is not surprising to ﬁnd that a third of establishments have only seasonal activities. The hotel turnover ranges from less than 750,000 Swiss Francs to over 10 million Swiss Francs per year, with around 52% with less than 2.5 millions.

The Intensity of Collaboration and Type of Management

161

60.00%

50.00%

40.00% Sample Hôtelleriesuisse 2004 30.00%

20.00%

10.00%

0.00% 1 star

Fig. 2.

2star

3 star

4star

5 star

Distributions of Hotels by Category.

When the two main inﬂuencing variables, the strength of collaboration and the type of management, are crossed, it appears that they are dependent (w2 ¼ 5.91, ddl ¼ 1, 1p ¼ 98.49%) (see Table 1). When considering the intensity of collaboration among themselves, the majority of hotels are weakly collaborating, only a third being in strong collaboration with other establishments. On the basis of the type of management the hotels are more or less equally distributed between those managed by the owner and those having an employed manager. It is important to note that there are only a small number of hotels simultaneously managed by the owner and having a strong collaboration. According to the number of employees (see Table 2), hotels managed by the owners are much smaller than those run by an employed manager. At the same time, the average size is similar between weakly collaborating hotels and those strongly collaborating. However, contrary to what could be expected, even if the biggest hotels have an employed manager as responsible they are weakly collaborating. When considering the same analysis according to the number of rooms the same observations were found.

162

THOURAYA GHERISSI LABBEN AND ANDREW MUNGALL 90.00% 80.00%

Sample Office Fédéral de la Statistique 2003

70.00% 60.00% 50.00% 40.00% 30.00% 20.00% 10.00% 0.00% Up to 10

Fig. 3.

Table 1.

From 11 to 20

From 21to 50

From 51 to 100

Over 100

Distribution of Hotels by Number of Rooms.

Number of Hotels According to the Intensity of Collaboration and the Type of Management. Type of Management

Collaboration intensity

Weak collaboration Strong collaboration Total

Owner-managers (%)

Employed managers (%)

36.8 (35) 10.5 (10) 47.4 (45)

28.4 (27) 24.2 (23) 52.6 (50)

Total (%)

65.3 (62) 34.7 (33) 100 (95)

Effect of Intensity of Collaboration on the Performance of Swiss Collaborating Hotels In considering the effect of the collaboration intensity on the performance factors of the hotels under the constraints dimension (see Table 3), the analysis of variance of one factor, ANOVA, shows that the strength of

The Intensity of Collaboration and Type of Management

Table 2.

163

Average Number of Employee According to the Intensity of Collaboration and the Type of Management. Type of Management

Collaboration intensity

Weak collaboration Strong collaboration Total

Owner-managers (%)

Employed managers (%)

18.31 26.7 20.18

72.69 53.76 64.23

Total (%)

41.49 45.03 42.68

collaboration has a signiﬁcant impact on one factor relative to the situation of internal resources concerning the state of the technological equipment, and two factors linked to the state of mind and motivation concerning the degree of control and the conﬁdence in the future of the branch. More precisely, hotels with strong collaboration perceive their technological equipment as more satisfying than those who weakly collaborate. Furthermore, they tend to delegate more than the weakly collaborating collaboration. Indeed, the degree of control (measured on a scale of 4) perceived by hotel managers is situated directly between partial control and delegation of control with follow-up for hotels with strong collaboration, and between total and partial control for weakly collaborating hotels. In addition, the hotels with a strong collaboration are more or less at ease with a certain conﬁdence in the future of the branch while the other hotels are a little more skeptical. In addition, when considering the performance of hotels comprised under the objectives dimension (see Table 4), three performance factors which are related to competition on the market signiﬁcantly discriminate between the hotels according to the intensity of their collaboration. Indeed, the hotels with strong collaboration perceive market competition as stronger and to have a higher price level than hotels weakly collaborating. In addition, the ﬁnancial situation was perceived rather satisfying by strongly collaborating hotels, but those with weak collaborations marked it as rather acceptable. Finally, when taking into account the performance of hotels under the referential dimension (see Table 5), based on the average percentage, the ANOVA analysis shows that only the percentage of the operational results II4 in relation to the yearly turnover discriminates between hotels according to the strength of their collaboration, and to the beneﬁt of those that strongly collaborate. This factor is measured at an average of 31% for hotels with a strong degree of collaboration and 22% for the other group of hotels.

164

THOURAYA GHERISSI LABBEN AND ANDREW MUNGALL

Table 3.

ANOVA/Global Effect of Collaboration Intensity on Performance Dimension of Constraints. ANOVA/Global Effect of Collaboration Intensity

Averages for Weakly Collaborating Hotels

Averages for Strongly Collaborating Hotels

V_amongst

V_within

F-ratio

Probability

3.41

3.65

1.23

0.48

2.57

0.108

3.08 4.26

3.06 4.56

0.01 1.99

0.47 0.75

0.02 2.66

0.859 0.102

3.03

3.32

1.86

1.21

1.54

0.214

3.81 3.60

4.09 4.03

1.72 4.11

1.08 0.91

1.59 4.5

0.207 0.034

2.19

2.21

0.01

0.33

0.03

0.838

3.61

3.76

0.55

0.93

0.59

0.452

3.68 3.71

3.82 3.88

0.47 0.65

0.94 0.98

0.5 0.67

0.489 0.421

3.55

3.51

1.19

2.95

0.085

4.12

0.31

0.52

0.59

0.451

3.18 3.77

7.26 1.54

0.99 0.87

7.33 2.01

0.007 0.155

4.06

4.37

1.13

3.85

0.049

Internal resources group Employee professional qualiﬁcations Website level Scope of the distribution network Efﬁciency of the distribution network Hotel infrastructure Technological equipments Investment needs Internal management group Procurement management HR management General administrative management

State of mind/motivation group Time for strategic 3.14 reﬂection Manager open4.0 mindedness Degree of control 2.60 Employee open3.48 mindedness Trust in the future of 3.61 the branch

Effect of Type of Management on the Performance of Swiss Collaborating Hotels Considering the effect of the type of management on the hotel performance under the dimension of constraints (see Table 6), the type of management in the collaborating hotels has a signiﬁcant impact on ﬁve performance factors. Two of them belong to the internal resources group: Website level and technology equipment. The averages show that the websites of the ownermanagers’ hotels are less developed than those of the employed managers’ hotels. More precisely, the websites of the latter offer more possibilities to

The Intensity of Collaboration and Type of Management

Table 4.

ANOVA/Global Effect of Collaboration Intensity on Performance Dimension of Objectives. Averages for Strongly Collaborating Hotels

V_amongst

V_within

F-ratio

Probability

3.62

3.68

0.07

1.31

0.06

0.799

3.67

3.97

2.04

0.83

2.45

0.116

group 3.61

4.0

3.29

0.77

4.25

0.039

3.39 3.19

3.56 3.44

0.65 1.39

0.67 0.36

0.96 3.87

0.33 0.049

3.76 3.21

4.21 3.79

4.4 7.63

1.18 1.35

3.73 8.67

0.053 0.018

Hotel vs. market competition Degree of market competition Differentiation level Price level compared to the competitors Advertising visibility Financial situation

Lodging turnover F&B turnover Salary costs Merchandise costs Operational results II

ANOVA/Global Effect of Collaboration Intensity

Averages for Weakly Collaborating Hotels Destination group State of the destination’s infrastructure Supply diversity of the destination

Table 5.

165

ANOVA/Global Effect of Collaboration Intensity on Referential Dimension. Averages for Weakly Collaborating Hotels (%)

Averages for Strongly Collaborating Hotels (%)

60.23 42.19 37.28 24.7 21.85

62.3 46.07 38.28 22.29 31.05

ANOVA/Global Effect of Collaboration Intensity V_amongst

V_within

F-ratio

Probability

92.07 275.97 18.2 102.46 1086.01

579.67 445.67 68.67 112.16 146.22

0.16 0.62 0.27 0.91 7.43

0.692 0.439 0.614 0.344 0.008

reserve and to pay online. Concerning the evaluation of the technological equipment owner-managers are less satisﬁed than employed managers. Furthermore, the only factor of the internal management group being signiﬁcantly impacted by the type of management is the general administrative management performance factor. On this aspect, the employed managers are also more satisﬁed. Finally, there are two factors of the state of mind motivation group on which the type of management has a signiﬁcant effect: Degree of control and employee open-mindedness. The employed managers tend to control to a lesser degree the work of their employees than

166

THOURAYA GHERISSI LABBEN AND ANDREW MUNGALL

Table 6.

ANOVA/Global Effect of Type of Management on Performance Dimension of Constraints.

Internal resources group Employee professional qualiﬁcations Website level Scope of the distribution network Efﬁciency of the distribution network Hotel infrastructure Technological equipments Investment needs Internal management group Procurement management HR management General administrative management

Averages for OwnerManagers’ Hotels

Averages for Employed Managers’ Hotels

3.4

ANOVA/Global Effect of Type of Management V_amongst

V_within

F-ratio

3.56

0.64

0.48

1.33

0.25

2.89 4.47

3.24 4.24

2.92 1.17

0.44 0.75

6.67 1.57

0.010 0.211

2.93

3.29

2.94

1.18

2.5

0.113

3.69 3.47

4.1 4.0

4.0 0.67

1.05 0.89

3.8 7.54

0.051 0.007

2.31

2.10

1.03

0.32

3.2

0.073

3.49

3.81

2.44

0.91

2.68

0.100

3.56 3.53

3.88 3.96

2.44 4.28

0.92 0.93

2.65 4.61

0.102 0.032

3.31

0.09

1.22

0.07

0.775

4.12

0.64

0.52

1.24

0.268

3.16 3.79

12.9 4.93

0.92 0.93

13.97 5.96

0.0004 0.015

3.80

0.19

1.16

0.16

0.687

State of mind/motivation group Time for strategic 3.24 reﬂection Manager open3.96 mindedness Degree of control 2.42 Employee open3.33 mindedness Trust in the future of 3.71 the branch

Probability

the owner-managers. This observation is associated with the fact that the degree of open-mindedness among employees was perceived to be higher by the employed managers. Besides, when taking into account the performance of hotels comprised under the objectives dimension (see Table 7), only two performance factors which are related to the competition on the market are signiﬁcantly impacted by the type of management: differentiation level and ﬁnancial situation. Indeed, employed managers think that their hotels are strongly differentiated on the market. This is much less the case for the ownermanagers. Additionally, the employed managers evaluate the ﬁnancial situation of their hotels more satisfactorily than owner-managers.

The Intensity of Collaboration and Type of Management

Table 7.

Destination group State of the destination’s infrastructure Supply diversity of the destination

167

ANOVA/Global Effect of Type of Management on Performance Dimension of Objectives. Averages for OwnerManagers’ Hotels

Averages for Employed Managers’ Hotels

3.42

3.71

Hotel vs. market competition group Degree of market 3.75 competition Differentiation level 3.25 Price level compared to 3.2 the competitors Advertising visibility 3.89 Financial situation 3.09

ANOVA/Global Effect of Type of Management V_amongst

V_within

F-ratio

Probability

3.84

4.13

1.26

3.28

0.069

3.80

0.21

0.83

0.25

0.623

3.76

0.00

0.80

0.01

0.896

3.62 3.36

3.20 0.61

0.64 0.37

5.02 1.67

0.026 0.196

3.92 3.7

0.03 8.85

1.21 1.29

0.03 6.88

0.841 0.009

Finally, when considering the performance of hotels under the referential dimension (see Table 8), the ANOVA analysis shows that only the share of F&B turnover in relation to the yearly turnover discriminates between hotels according to the type of management. Indeed, this share amounted on average to around half of the annual hotel turnover among the hotels managed by their owners, while it was found to be around 39% for the employed managers’ hotels.

CONCLUSION AND DISCUSSION It is notable that the number of signiﬁcant results was less than what was originally expected. Nevertheless, there are some remarks that need to be emphasized. First of all, when observing the average level of each performance factor, it is noted that higher appreciation is found more often among hotels strongly collaborating and run by employed managers, with two minor exceptions. These latter refer to two performance factors related to the constraints dimension. On one side, the website level when analyzing the inﬂuence of the collaboration intensity and, on the other side, the scope of the distribution network when considering the effect of the type of management. Nevertheless, when taking into account the performance dimension of referential, it is more difﬁcult to assume that owner-managers’ hotels are

168

Table 8.

THOURAYA GHERISSI LABBEN AND ANDREW MUNGALL

ANOVA/Global Effect of Type of Management on Referential Dimension.

Lodging turnover F&B turnover Salary costs Merchandise costs Operational results II

Averages for OwnerManagers’ Hotels (%)

Averages for Employed Managers’ Hotels (%)

56.07 51.03 37.03 24.11 23.48

63.92 38.84 38.53 23.11 27.36

ANOVA/Global Effect of Type of Management V_amongst

V_within

F-ratio

Probability

1456.83 3080.12 44.47 20.0 195.6

541.55 377.89 67.54 101.28 161.01

2.69 8.15 0.66 0.2 1.21

0.100 0.006 0.424 0.661 0.275

performing less well based on the factors considered. This is especially the case for the lodging and F&B shares in the annual hotel turnover. Indeed, independently of the two inﬂuencing variables, the core business of some establishments is on the lodging side while it is on the F&B for the others. However, as the share in the annual turnover of salary and merchandise is generally correlated to the overall turnover, this could be in some way used to compare performance. Additionally, operational results II can be used for that purpose in the same way as it is commonly used by the Swiss hospitality industry for benchmark reasons. The results related to the impact of collaboration intensity tend to go in the same direction as the studies of Frey (2002) and Bieger et al. (2004), which show that the strength of collaboration represents a necessary condition for the maximization of the added value of collaboration. However, there are two main obstacles impeding the intensiﬁcation of collaboration in the Swiss hotel sector. On the one hand, since the majority of hotels are family businesses, collaboration is often perceived as implicating a loss of control. On the other hand, as mentioned above a development of a stronger collaboration requires additional investments and resources, which are not easily obtainable at the moment as a signiﬁcant number of Swiss hotels are facing serious ﬁnancial problems. One can thus suppose that the strongest collaborating hotels are probably those who have been in a comfortable ﬁnancial situation from the beginning. Concerning the results obtained for the effect of the type of management, independently of how performance was measured, the literature (Daily & Dalton, 1992; Wahlgre´n & Stewart, 2003) generally indicates that ownermanagers are performing better than employed managers when the size of the ﬁrm is not too large. Without entering into the controversy of what large or small means in terms of size, this study shows that the employed managers of collaborating hotels have higher performance than the other group

The Intensity of Collaboration and Type of Management

169

as they run on average bigger establishments in terms of number of employees. That being the case, size does not totally explain the difference of performance as the answering hotel sample is comprised of a few very big establishments among the employed managers’ hotels, signiﬁcantly increasing the average size of these hotels. At the same time, these answers do not conﬁrm that the difference in the performance of collaborating hotels is due to the difference in the type of management which is considered as an observable characteristic according to the deﬁnition used in this study. Thus, some authors such as Pansiri (2005) suggest a cognitive orientation where, instead of concentrating on this type of observable variables one should focus on factors related to the psychological proﬁle and personality elements. This leads to the concept of psychological ownership (Kets de Vries, 1995) explaining that the owner-manager has a high commitment and emotional relation with the ﬁrm. On that basis, as the measurement of performance in the study is based on managers’ perception, it could be assumed that owner-managers have slightly overestimated their low performance which could explain the limited number of signiﬁcant results. Besides, it is worth mentioning that the alpha-Cronbach coefﬁcient amounts to 0.722. This value being not very satisfactory the model should be improved in the future. Finally, the results of this study cannot be applied to the entire Swiss hotel population, as the rate of response to the questionnaire was weak (less than 5%). In spite of these limits, this study represents a ﬁrst attempt to measure qualitatively the performance of collaborating Swiss hotels.

NOTES 1. In this article, the terms ‘collaboration’ and ‘cooperation’ are interchangeable. 2. In this article the ‘type of management’ results from who the manager is (owner or employee). 3. In this article, collaboration and cooperation are indifferently used. 4. According to the Swiss accounting system ‘operational result II’ corresponds to the result before ﬁnancial taxes and interest and amortization.

REFERENCES Bamberger, I. (1979). De´veloppement et croissance des entreprises: un cadre de re´fe´rence the´orique pour un projet de recherche concernant les petites et moyennes entreprises. Cahiers strate´gies et organisations, 2, IGR Rennes.

170

THOURAYA GHERISSI LABBEN AND ANDREW MUNGALL

Barton, S. L., & Matthews, C. H. (1989). Small ﬁrm ﬁnancing: Implications from a strategic management perspective. Journal of Small Business Management, 27, 1–7. Baum, J. A. C., Calabrese, T., & Silverman, B. S. (2000). Don’t go it alone: Alliance network composition and startups’ performance in Canadian biotechnology. Strategic Management Journal, 21, 267–294. Baum, J. A. C., & Oliver, C. (1991). Institutional linkages and organizational mortality. Administrative Science Quarterly, 36(2), 187–218. Bieger, T., Beritelli, P., & Weinert, R. (2004). Do cooperations really pay? Contribution based on strategy process theory for the case of small and medium sized ski area companies. Proceeedings of the 43th congress of the AIEST, the future of small and medium sized enterprises in tourism, September, Petra, Jordan. Bleeke, J., & Ernst, D. (1991). The way to win in cross-border alliances. Harvard Business Review, 69(6), 127–135. Chandler, G., & Hanks, S. (1998). An examination of the substitutability of founder’s human and ﬁnancial capital in emerging business ventures. Journal of Business Venturing, 13, 353–369. Chandler, G., & Hanks, S. H. (1994). Market attractiveness, resource-based capabilities; venture strategies and venture performance. Journal of Business Venturing, 9(4), 331–349. Cooper, A. C., Gimeno-Gascon, F. J., & Woo, C. Y. (1994). Initial human and ﬁnancial capital as predictors of new venture performance. Journal of Business Venturing, 9(5), 371–395. Cosh, A., Fu, X., & Hughes, A. (2005). Management characteristics, collaboration and innovative efficiency: Evidence from UK Survey Data. Working Paper no. 311, Centre for Business Research, University of Cambridge. Daily, C. M., & Dalton, D. R. (1992). The relationship between governance structure and corporate performance in entrepreneurial ﬁrms. Journal of Business Venturing, 7, 375–386. Donckels, R., & Frohlich, E. (1991). Are family businesses really different? European experiences from STRATOS. Family Business Review, 7(2), 149–160. Dyer, J. H., & Nobeoka, K. (2000). Creating and managing a high-performance knowledgesharing network: The Toyota case. Strategic Management Journal, 21(Special Issue), 345–367. Dyer, J. H., & Singh, H. (1998). The relational view: Cooperative strategy and sources of interorganisational competitive advantage. Academy of Management Review, 23, 660–679. Echols, A., & Wenpin, T. (2005). Niche and performance: The moderating role of network embeddedness. Strategic Management Journal, 26, 219–238. Fadil, N. (2003). La mesure de la performance des PME: Un cas d’application de la de´cision d’introduction en Bourse. Papier de recherche, IAE de Caen Basse Normandie. Fe´de´ration suisse du tourisme. (2005). Le tourisme suisse en chiffres. Berne: Fe´de´ration Suisse du Tourisme. Feeser, H., & Willard, G. (1990). Founding strategy and performance: A comparison of high and low growth high tech ﬁrms. Strategic Management Journal, 11(2), 87–98. Frey, M. (2002). Netzwerkmanagement in der Hotelindustrie. Bern: Haupt Verlag. Gulati, R. (1998). Alliances and networks. Strategic Management Journal, 19(4), 293–317. Gulati, R., Nohria, N., & Zaheer, A. (2000). Strategic network works. Strategic Management Journal, 21(3), 203–215, special issue.

The Intensity of Collaboration and Type of Management

171

Hagedoorn, J., & Schakenraad, J. (1994). The effect of strategic technology alliances on company performance. Strategic Management Journal, 15(4), 291–309. Harbison, J. R., & Pekar, P., Jr. (1998). Smart alliances – A practical guide to repeatable success. San Francisco: Jossey-Bass. Harper, P. (2001). Four steps to making strategic alliances work for you. Journal for Quality and Participation, 24(4), 24–27. Hoffmann, W. H., & Schlosser, R. (2001). Success factors of strategic alliances in small and medium-sized enterprises – An empirical survey. Long Range Planning, 34, 357–381. Kaish, S., & Gilad, B. (1991). Characteristics of opportunities search of entrepreneurs versus executives: Sources, interests, general alertness. Journal of Business Venturing, 6, 45–61. Kale, P., Dyer, J. P., & Singh, H. (2002). Alliance capability, stock market response, and longterm alliance success: The role of the alliance function. Strategic Management Journal, 23(8), 747–767. Kets de Vries, M. F. R. (1995). Life and death in the executive fast lane: Essays on irrational organizations and their leaders. San Francisco: Jossey-Bass. Kogut, B. (1988). Joint ventures – theoretical and empirical perspectives. Strategic Management Journal, 9, 319–332. Kotey, B. (2005). Goals, management practices, and performance of family SMEs. International Journal of Entrepreneurial Behaviour and Research, 11(1), 3–24. Marvel, W. (2001). Switzerland. Travel and Tourism Intelligence, Country Reports, 3. London: Mintel International Group, pp. 111–123. McConnell, J. J., & Nantell., T. I. (1985). Corporate combinations and common stock returns: The case of joint ventures. Journal of Finance, 40, 519–536. McGee, J., Dowling, M., & Megginson, W. (1995). Cooperative strategy and new venture performance: The role of business strategy and management experience. Strategic Management Journal, 16(7), 565–580. Mitchell, W., & Singh, K. (1996). Survival of businesses using collaborative relationships to commercialize complex goods. Strategic Management Journal, 17, 169–195. Nelson, T. (2003). The persistence of founder inﬂuence: Management, ownership, and performance effects at initial public offering. Strategic Management Journal, 24, 707–724. Observatoire des PME europe´ennes. (2003). La coope´ration entre les PME, 5. Luxembourg: Ofﬁce de Publications Ofﬁcielles des Communaute´s Europe´ennes. Pansiri, J. (2005). The Inﬂuence of managers’ characteristics and perceptions in strategic alliance practice. Management Decision, 43(9), 1097–1113. Park, S. H., & Ungson, G. R. (1997). The effect of national culture, organizational complementarity, and economic motivation on joint venture dissolution. Academy of Management Journal, 40(2), 279–307. Pennings, J. M., & Goodman, P. S. (1977). New perspectives on organizational effectiveness. San Francisco: Jossey-Bass. Poutxiouris, P. (2003). The strategic orientation of owner-managers of small ventures: Evidence from the UK small business economy. International Journal of Entrepreneurial Behaviour and Research, 9(5), 185–214. Powell, W. W., Koput, K. W., & Smith-Doerr, L. (1996). Interorganizational collaboration and the locus of innovation: Networks of learning in biotechnology. Administrative Science Quarterly, 41, 116–145. Prosser, D. (1997). Partnership and outsourcing. Hotel Online, June. http://www. hotelonline.com

172

THOURAYA GHERISSI LABBEN AND ANDREW MUNGALL

Robbins, S. P. (2000). The essentials of organizational behaviour. Upper Saddle River, New York: Prentice-Hall. Schrader, S. (1993). Kooperationen. In: J. Hauschildt, & O. Gru¨n (Eds), Ergebnisse empirischer betriebswirtschaftlicher Forschung (pp. 221–254). Stuttgart: Schaeffer Poeschel Verlag. Stuart, T. E. (2000). Interorganizational alliances and the performance of ﬁrms: A study of growth and innovation rates in a high-technology industry. Strategic Management Journal, 21, 791–811. Wahlgre´n, A., & Stewart, R. (2003). Owner-managers: Freedoms and constraints. Strategic Change, 12, 21–29. Zollo, M., Reuer, J. J., & Singh, H. (2002). Interorganizational routines and performance in strategic alliances. Organization Science, 13(6), 701–713.

A STUDY ON THE ONLINE SALES EFFICIENCY OF UPSCALE AND LUXURY HOTELS IN GERMANY, SWITZERLAND AND AUSTRIA Marco A. Gardini ABSTRACT While prior research on websites has largely focused on service quality perception by customers, little research has gone into the investigation of the specific sales function of the website. A survey of 111 German, Swiss and Austrian four and five star hotels was designed to test the responsiveness of hotels to reservation inquiries made through the options offered by the companies’ corporate websites (e.g. e-mail, online booking forms, request for proposal forms etc.) and to evaluate the hotels online sales performance in terms of the technical and process quality while dealing with a typical reservation request. The current study found that many hotels missed the opportunity to increase sales by failing to respond adequately to electronic reservation inquiries.

INTRODUCTION Resort hotel operators spend thousand of dollars to promote their resorts. Yet when this advertising generates reservation inquiries, some operators Advances in Hospitality and Leisure, Volume 3, 173–192 Copyright r 2007 by Elsevier Ltd. All rights of reproduction in any form reserved ISSN: 1745-3542/doi:10.1016/S1745-3542(06)03010-4

173

174

MARCO A. GARDINI

miss the opportunity of converting this leads into conﬁrmed reservations (Grohmann, 1966). These words, written 40 years ago are more actual and signiﬁcant than ever. With the proliferation of e-commerce and the Internet, hospitality and tourism organization have to tackle the organizational sales challenges being imposed by the new competitive dimension the Internet provides. The relevance of the Internet and its transformation of traditional distribution networks in tourism industry have been discussed in the academic literature for more than one decade. There is an abundance of studies and experts predicting that in the near future approximately between 20 and 30 percent of the bookings in the hospitality industry will be carried out online (O’Conner & Frew, 2002; Caroll & Siguaw, 2003; Hotelmarkt Deutschland, 2004; Ulysses, 2003). Furthermore, the beneﬁts of corporate websites in hospitality organizations are believed to go beyond simply offering possibilities of promotion and sales, they also offer possibilities for direct customer contact and interaction. Hotel corporations have responded to the opportunities offered by the Internet and continuously redesign their websites for ease and convenience, and upgrade website technology to improve customer service and to personalize their sites for their customers. Hence, the corporate website is believed to be not only an alternate distribution channel, but also to have the potential to become the most important one among the sales channels within the electronic distribution system in tourism industry (Baloglu & Pekcan, 2006; Olsen & Conolly, 2000). However, despite of the increased business opportunities being provided through the Internet many hotels do not effectively follow through with online reservation inquiries made through the options offered by the companies’ corporate websites (e.g. e-mail, online booking forms (OBFs), request for proposal forms etc.). In a highly competitive environment like the hospitality industry, with chain and individual hotel corporations continuously looking for new ways of generating sales, cutting costs, increasing proﬁts, improving service quality and brand image it appears to be incomprehensible that many companies do not exploit the sales opportunities being provided through reservation inquiries. This is especially peculiar as reservation inquiries for hotel rooms, conference facilities, catering services or other hotel services, whether by traditional means such as letter, fax or telephone or through the Internet were and will be a hotels’ primary source of sales (Ho, Jacobs, & Cox, 2003; Hsu & Powers, 2002). One approach to maximize sales or to improve the reservation inquiries/sales ratio lies within the ability of a hotel to professionalize its online sales process. To help create more awareness for the managerial necessities in improving the

A Study on the Online Sales Efficiency of Upscale Hotels

175

corporate website sales performance, this research reports on a mystery shopper survey revealing operational problems in handling online reservation inquiries. The samples’ cross-section of German, Swiss and Austrian hotels offers managers the opportunity to compare their own perceptions and experiences and to gain insight into opportunities through reﬂecting on our discussion of the major key failures made by the participating hotels.

PREVIOUS RESEARCH ON INQUIRY CONVERSION AND WEBSITE EFFECTIVENESS Despite of the continuing debate about the relevance of the Internet as one of the most powerful marketing tools and the increasing sales opportunities this medium offers, little research has investigated the effectiveness of the corporate website as one of the major components within the sales channel mix in the hospitality industry. A wide body of research has discussed and proposed measures to evaluate websites, ranging from the number of hits, server log-analysis and/or other more general measures of the websites’ service quality, including items such as user satisfaction, consumer perception, usability and information quality of a website, attitude to the website or using service quality measurements such as WebQual, E-Qual or E-Service Quality (Barnes & Vidgen, 2000; Lociacono & Watson, 2000; Kayanama & Black, 2000; Zeithaml, Parasuraman, & Malhotra, 2001). Other research has gone into the examination of behavioral factors that affect online reservation intentions (Kim & Kim, 2004; Shim, Eastlick, Lotz, & Warrington, 2001). However, in most of the cases the website performance evaluation is of a general and behavioral nature, and limited attention has been put on the speciﬁc sales function of the website and its ability in converting inquiries into sales. With the continuing growth of information technology and the Internet, considerable research has gone into the examination of tourism or hotel website effectiveness (Stergiou & Airey, 2003; Tierney, 2000; Chung & Law, 2003; Hsu, Zhu, & Agrusa, 2004). Speciﬁc research on inquiry conversion so far has focused intensively on the effectiveness of tourism advertising campaigns. Inquiry conversion research is conducted to determine the number of inquirers who subsequently visit the advertised destination. In contrast, to the best of our knowledge, the effectiveness of hotels’ corporate websites in terms of converting online reservation inquiries into sales has not yet been investigated. Previous research on inquiry conversion in the hospitality

176

MARCO A. GARDINI

industry has predominantly focused on traditional means of reservation requests such as letter, fax and telephone. Several studies appear to support Grohman’s observation (Hartley & Witt, 1992, 1994; Veverka, 1995; Ho et al., 2003; ServiceQualita¨t Niedersachsen, 2006). Focusing on telephone inquiries Hartley and Witt (1992, 1994) and Veverka (1995) found in their studies that the majority of the hotels missed the opportunity to convert telephone inquiries into sales. For example, Veverka reported that from 100 test calls to hotels across the U.S. over 90 percent did not manage to close the sale or to respond effectively to the inquirer’s needs. This is in line with the ﬁndings presented by Hartley and Witt, who found that 77 percent of the hotels did not ask about the details of the planned event and thus could not send an appropriate written response addressing the potential client’s speciﬁc needs. In one of the most recent studies of inquiry conversion Ho et al. (2003) created a ﬁctitious situation where 100 letters were send to a random sample of hotels with 250 or more rooms located in the U.S., Canada, Mexico and the Caribbean, requesting information for a potential client who would be hosting a business reception for 20 couples from out-of-town. The study of 2003 was a replication of one of the authors’ previous study in 1988, where 998 letters of similar content were mailed to major hotels in the above-mentioned regions. A major result in terms of the response rates of these studies was that in the 1988 more than 27 percent of the hotels surveyed did not respond to the letter of reservation inquiry, whereas in 2003 the ratio between responses to non-responses was 79 to 21 percent. Further results of the studies indicated that the quality of the hotels’ marketing responsiveness showed many weaknesses concerning classical marketing and sales activities like making recommendations, trying to up-sell, offering special promotions, discounts or rebates, making suggestions to make the planned event special, providing the inquirer with customer-tailored information or actively following up the hotels’ answer to the reservation request. These results do not prove to be a country- or culture-speciﬁc phenomenon as a recent study on service quality in the tourism and hospitality industry conducted by the tourism marketing association of Lower Saxony in Germany reveals. Focusing on e-mail reservation and information requests by tourists the study found that approximately 30 percent of the hotels and 20 percent of the local tourism ofﬁces did not respond to potential customer mail inquiries (ServiceQualita¨t Niedersachsen, 2006). The design of the current study to a large extent was based on the research done by Ho et al. (2003). The major difference was that the study tried to examine the responsiveness of hotels concerning online inquiries, whereas Ho et al. focused on traditional means of reservation inquiries such as

A Study on the Online Sales Efficiency of Upscale Hotels

177

letters. Against this background, this paper describes an inquiry conversion study designed to evaluate the sales effectiveness of hotels corporate websites. Because of the enormous increase in the number of online hotel reservations in the upcoming years, hotel marketers need to understand the urge for an efﬁcient online sales transaction process. In detail, this study was designed to test the responsiveness and to evaluate the quality of the concrete responses of hotels to reservation inquiries made through the electronic options offered by the hotels’ corporate websites such as standard e-mail address, OBFs and/or request for proposal forms. The study therefore focuses on the following research objectives: to evaluate the general responsiveness of hotels to online reservation inquires; to evaluate the hotels online sales efﬁciency in terms of the technical and process quality while handling a typical reservation request; and to assess whether there are differences in the online sales process quality depending on the geographic origin and/or the professional afﬁliation of the hotel (chain vs. individual hotel). On the basis of its ﬁndings the paper goes on to explore some of the managerial problems and potential organizational issues associated with improving online sales conversion rates. Recommendations for improving the quality and accuracy of online inquiry management will be given as well as the limitations of the study will be discussed. This research hopes that the lessons learned can allow hotels to adjust their way of doing their online sales business, so that hotels can capitalize on sales leads and potential customers can be turned into real ones.

METHOD The study was designed as a mystery shopper analysis. Churchill and Iacobucci (2005) refer to mystery shopping as a technique of disguised observation, which serves as valuable means to capture service quality information together with other type of internal or external quality sources. They further claim that the method typically reveals organizational deﬁciencies that require corrective action and/or individual excellence on the level of the customer contact personnel. By its very nature such a procedure is to be conducted under ﬁeld conditions, so that careful attention was therefore drawn on the authenticity of the inquiry being made. In the ﬁctitious situation created a potential client requested information for an engagement

178

MARCO A. GARDINI

reception he wanted to host for 30 persons from out-of-town (family, friends, business partners) looking for guestroom options (2 nights) and several catering services (champagne reception, gala dinner, breakfast, etc.). In the online request the hotels were explicitly asked to answer via e-mail, as the potential client was traveling a lot overseas and could not be reached by other means of communication. The potential sales opportunity represented a conservatively estimated revenue of approximately h10.000 (ca. 12.000 U.S.$). In summer 2004, electronic inquiries were mailed to 111 upscale and luxury hotels (four to ﬁve star category according to the German hotel classiﬁcation, DEHOGA, 2005) in Germany, Switzerland and Austria via the direct contact facilities as offered by each individual hotel’s website. The stratiﬁed random sample was drawn from the German, Swiss and Austrian hotel industry. The selection of hotels was made with the help of various hotel guides (IHA Hotelfu¨hrer, 2004; Guide Michelin, 2004; Varta, 2004). The criteria for the inclusion in the study was that the organization had to be settled within the superior four to ﬁve star category and to provide a minimum of 80 rooms to handle the operational requirements of the mystery reservation inquiry. Furthermore the study strived for an equal distribution of hotels in terms of the geographic origin and the professional afﬁlia tion (see Table 1). However, due to the smaller geographical dimensions of Austria and Switzerland and the differences in the countries industry structure the sample selection could not be chosen in similar numbers. Empirical evidence and theoretical arguments have shown that in many services there maybe two overriding dimensions to service quality and/or customer satisfaction: the core or technical aspects of the service (what is being delivered) and the relational or process aspects of the customer– employee relationship (how it is delivered) of the service (Gro¨nroos, 1984; Morgan, 1992; Zeithaml, Berry, & Parasuraman, 1996). Hence, the paper investigates the overall online sales process quality (process aspects and technical tools) with regard to what a potential customer may encounter when attempting to make a deﬁnite booking or reservation request. Based

Table 1. Hotel Characteristics by Country and Professional Afﬁliation.

Germany Switzerland Austria Total

Chain Hotels

Individual Hotels

Total

24 11 18 53(47.7%)

13 26 19 58(52.3%)

37 37 37 111(100%)

A Study on the Online Sales Efficiency of Upscale Hotels

179

on the literature review a set of variables was established to assess the quality of the online sales process (Ho et al., 2003; Chung & Law, 2003). The ﬁrst set of variables was designed to test the hotels’ overall responsiveness and their efﬁciency in handling the speciﬁc online reservation inquiry. The variables included are given below. Process Quality: Responsiveness and Efficiency Response rate, response time, type of responses, the hotels ability of actively marketing room and catering services including variables such as ‘‘recommendations for the potential client’’, ‘‘special offerings for room and/or catering services’’, ‘‘up-selling activities’’, ‘‘provision of additional material’’, ‘‘consultation of the potential client on the planned event’’, ‘‘determination of an expiry date’’ and ‘‘follow up/lost order analysis’’. The second set of variables was designed to measure the technical quality (technical conﬁguration) of the electronic request options being provided by the hotels’ corporate websites. Variables used here are given below. Technical Quality: Configuration of Corporate Website Availability of online booking formats, type of format such as online booking formats (OBF); ‘‘reservations request only’’ (RRO); ‘‘request for proposal for events’’ (RFP); ‘‘format for business and/or private events’’, availability of functions and features such as ‘‘availability check’’; ‘‘remarks section’’; ‘‘cancelation’’; ‘‘member login’’; ‘‘safe data transmission’’.

RESULTS AND DISCUSSION The ﬁndings of this study are separated into three parts: the general overview of the responses obtained from the online inquiry and the results from cross-tabulations of the overall ﬁndings concerning the process quality and the technical quality. General Overview As illustrated in Table 2 the most striking observation in this study is that 18.9 percent (21/111) of the hotels surveyed did not respond to the online

180

MARCO A. GARDINI

Table 2.

Response Rates and Response Time. Chain Hotels

Individual Hotels

Total

Response rate Yes Germany Switzerland Austria

36 18 8 10

54 12 25 17

90(81.1%) 30 33 27

No Germany Switzerland Austria

17 6 3 8

4 1 1 2

21 (18,9%) 7 4 10

53(47.7%)

58(52.3%)

111(100%)

25 7 3 1 36(40%)

44 8 2 — 54(60%)

69(76.6%) 15(16.7%) 5(5.6%) 1(1.1%) 90(100%)

Total Response time Response within 3 days Response within 4–7 days Response within 8–14 days Response after 14 days Total

inquiry. These results were similar to the ﬁndings of the inquiry conversion studies mentioned before, using traditional means of reservation requests such as letter, fax or telephone. For instance, Ho et al. reported response rates of 21 percent (2003) and 25 percent (1988), respectively, in their studies using reservations letters. Interestingly, of the 21 non-replies in the current study, 80 percent (17) were from chain hotels. This is worth mentioning for two reasons. First of all the paper would follow the general notion that chain hotels are assumed to be more professional in their sales policies than individual hotels, using standard procedures, being staffed with sales experts and having knowledge support by their headquarters. Second, and this was supported by the ﬁndings (see Table 4), one would assume that chain hotels due to their usually stronger ﬁnancial background dispose of more elaborate and sophisticated technical capabilities in their online business than individual hotels, so that this should lead to an advantage concerning their sales efforts. The response results of the study obviously contradict this maybe biased interpretation. Concerning the country of origin it could be revealed that the majority of non-replies resulted from Austrian hotels (10/21), followed by their German (7/21) and Swiss (4/21) competitors. Of the 90 responses received (81.1 percent), approximately 77 percent answered within three days, whereas 22 percent took more than four days

A Study on the Online Sales Efficiency of Upscale Hotels

181

but less than 14 days to respond. One hotel sent a response after two weeks. If one acknowledges the fact that the Internet is being perceived as a synonym for speed and fast transaction, response rates of four days and more have to be considered as insufﬁcient with regard to perceived process quality. Adding these ‘‘slow’’ respondents to the number of non-respondents reﬂects that a high percentage (42 hotels or 37.8 percent) of hotels which either did not want to pursue the sales opportunities offered by the inquiry or were not extremely dedicated to do so considering their inappropriate response time. Of the 90 responses only 74 (67 percent out of 111 hotels surveyed) answers were actually exploitable offers regarding the requested scenario, the other responses included rejections due to adverse circumstances such as seasonal closure, refurbishment or insufﬁcient capacity on the speciﬁc date requested. Relating the variables response quality vs. country of origin, it could be revealed that Swiss (84.8 percent) and German hotels (83.3 percent) were signiﬁcantly faster than their Austrian competitors (59.2 percent) in answering within the scope of three days.

Process Quality: Responsiveness and Efficiency Besides assessing response rates and time a major concern of the study was to evaluate the quality of the advisory service being provided by the hotels within the sales process. How active and professional are room and catering services being marketed, is the marketing approach more standardized with standard packages/modules being sold or are hotels trying to pursue a customer-tailored marketing approach with speciﬁc suggestions, individual recommendations or unique ideas for the event? Of the 74 answers that responded speciﬁcally to the online inquiry, the study found that many hotels were not particularly marketing driven in their sales performance. In terms of guest room marketing approximately half (47.3 percent) of the hotels reacted only with standardized offerings, whereas the other half (52.7 percent) reacted with inquiry-speciﬁc offerings ranging from upgrades, rebates or rooms free of charge for the inquirer and/or children (see Table 3). A striking observation here was that none of the hotels tried to upsell by promoting special rooms to the inquirer or the potential client’s guests (e.g. a suite, a family room). With regard to the hotels responsiveness in marketing their catering services similar results could be found. From the 74 respondents, 92 percent reacted to the client’s request concerning the reception and the dinner event, approximately 7 percent suggested alternatives if the hotel could not

182

Table 3.

Process Quality.

Country of Origin Germany frequency

Austria frequency

%

Total % Chain % Individual % frequency frequency frequency

Total frequency

%

26 1 1 2

86.6 3.3 3.3 6.6

25 7 1 0

75.8 21.2 3.0 0.0

23 4 0 0

85.2 14.8 0.0 0.0

74 12 2 2

82.2 13.3 2.2 2.2

33 1 1 1

91.6 2.8 2.8 2.8

41 11 1 1

75.9 20.4 1.9 1.9

74 12 2 2

82.2 13.3 2.2 2.2

10 5

38.5 19.2

12 3

48.0 12.0

13 2

56.5 8.7

35 10

47.3 13.6

16 4

48.5 12.1

19 6

46.3 14.6

35 10

47.3 13.6

2

7.7

3

12.0

1

4.3

6

8.0

3

9.1

3

7.3

6

8.0

9 0

34.6 0.0

7 0

28.0 0.0

7 0

30.4 0.0

23 0

31.1 0.0

10 0

30.3 0.0

13 0

31.7 0.0

23 0

31.1 0

26

100.0

25

100.0

23

100.0

74

100.0

33

100.0

41

100.0

74

100.0

25

96.1

22

88.0

21

91.3

68

91.9

28

84.8

40

97.6

68

91.9

0

0.0

1

4.0

0

0.0

1

1.3

0

0.0

1

2.4

1

1.3

MARCO A. GARDINI

I. General type of response (n ¼ 90) Speciﬁc reference to inquiry Rejection Asked for more details No speciﬁc reference to inquiry II. Marketing room services (n ¼ 74) Active room marketing Standard room offerings Special room for inquirer without surcharge Room for inquirer free of charge Children free of charge Tried to upsell (suite, family room): Yes Tried to upsell (suite, family room): No III. Marketing catering services (n ¼ 74) Reference to inquiry concerning catering: Yes Reference to inquiry concerning catering: No

% Switzerland % frequency

Afﬁliation

1

3.9

2

8.0

2

8.7

5

6.8

5

15.2

0

0.0

5

6.8

17

65.4

14

56.0

14

60.9

45

60.8

21

63.6

24

58.5

45

60.8

6

23.1

9

36.0

5

21.7

20

27.0

8

24.2

12

29.3

20

27.0

3

11.5

2

8.0

4

17.4

9

12.2

4

12.1

5

12.2

9

12.2

3

11.5

5

20.0

3

13.0

11

14.9

1

3.3

10

24.4

11

14.9

23

88.5

20

80.0

20

87.0

63

85.1

32

96.7

31

75.6

63

85.1

21

80.7

12

48.0

11

47.8

44

59.5

20

60.6

24

58.5

44

59.5

5

19.3

13

52.0

12

42.2

30

40.5

13

39.4

17

41.5

30

40.5

6

23.1

10

40.0

17

73.9

33

44.6

13

39.4

20

48.8

33

44.6

20

76.9

15

60.0

6

26.1

41

55.4

20

60.6

21

51.2

41

55.4

A Study on the Online Sales Efficiency of Upscale Hotels

Rejection/suggestion of alternative location Provided additional information concerning catering Standard material (brochures, sales folder, etc.) Inquiry speciﬁc material (individual menu/buffet) No additional material included Unique suggestions for the overall planning of event: Yes Unique suggestions for the overall planning of event : No Expiry date expressed in offering: Yes Expiry date expressed in offering: No Follow up (response to cancellation mail): Yes Follow up (response to cancellation mail): No

183

184

MARCO A. GARDINI

accommodate the client’s request, one hotel did not refer to the catering at all in the response letter. In terms of additional promotional material provided the majority (60.8 percent) of the respondents simply enclosed standard offerings and material (e.g. general F&B information, banquet folder, brochure, photos) in their response letters, whereas 12.2 percent did not include any material at all. Only 27 percent made individual menu/buffet propositions or made a customer-tailored promotional offer in the reply letter referring to the speciﬁc inquiry. Overall in terms of the hotels responsiveness in marketing their guest rooms and catering services no signiﬁcant difference could be found between both the hotels countries of origin and their status as private or corporate controlled hotel. The only signiﬁcant difference detected was that from the hotels responding only a small percentage (14.9 percent) tried to make unique or extraordinary suggestions toward the overall planning of the event. It was interesting that the majority of hotels making this marketing effort were individual hotels, while only 1 out of 36 chain hotels responding tried to differentiate itself form its competitors by making the stay and/or the banquet services special. Another important step within a professional sales process is the follow up. First of all approximately 60 percent of the respondents did include an expiry date for the rooms and banquet facilities held on option. In terms of capacity management this criterion is highly relevant as it enables the hotel to put unsold capacity up for sale again. Considering the country of origin 80.7 percent of the German, 48 percent of the Swiss and 47.8 percent of the Austrian hotels included an expiry date. With regards to the concrete follow up of the hotels offerings the study revealed that the majority of the hotels failed in this part of the sales process, as only 44.6 percent of the hotels tried to ﬁgure out the reasons of the rejection after having received an electronic cancellation as part of the ﬁctitious scenario. In contrast to the other results the Austrian hotels showed more proﬁciency in the case of the sales follow up with 73.9 percent of the hotels responding to the cancellation mail, while only 40 percent of the Swiss and 23.1 percent of the German hotels tried to analyze the reasons of the rejection.

Technical Quality: Configuration of Corporate Website In contrast to other research on website effectiveness, the current study examined exclusively the transaction capabilities of the hotels’ websites, speciﬁcally focusing on the online sales functionality being provided by

A Study on the Online Sales Efficiency of Upscale Hotels

185

the surveyed companies. As illustrated in Table 4 the most striking observation concerning the technical side of the study is that 20.7 percent of the hotels did not feature online reservation capacity for immediate, conﬁrmed booking of a hotel service. As mentioned before it was expected that chain hotels would demonstrate technically more sophisticated websites with tools such as real time booking engines, which could be proven by the study. Of the 88 hotels (79.3 percent) providing an OBF, 50 were chain and 38 were individual hotels, which reﬂects the signiﬁcant technological lead of the hotel chains with 94.3 percent (50/53) of the chain hotels providing an OBF in contrast to 65.5 percent (38/58) of the individual hotels. Besides assessing the mere existence of an OBF, another concern of the study was what functionality was featured by the OBF. As illustrated in Table 4 features such as an availability check function, the inclusion of a remarks section for special wishes and details on the stay, member login, online cancellation of an existing reservation, and the indication of safe data transmission and payment details were items of major interest reﬂecting the technical quality of the corporate websites. Here the majority of the hotels providing an OBF performed well in terms of the tested items (see Table 4). Only the inclusion of a cancellation function got out of line as 54.5 percent of the analyzed hotels’ websites did not provide any possibility for a booking to be canceled, forcing customers to fall back upon conventional means of direct communication such as telephone, mail, fax or letter. Here the companies fail to ensure that the customers have some degree of control, which has been proven to be an important criterion for the perceived quality in online service encounters (Sweeney & Lapp, 2004). Furthermore, the study also assessed whether the hotels provided alternative online possibilities for a potential client to make a reservation request. Alternative online formats, which could be identiﬁed were either the ‘‘RRO’’ format or the ‘‘RFP’’ format, which was provided either for business and/or for private events. In terms of offering alternative online request forms to potential customers the majority of the hotels performed poorly, with only 51.4 percent providing an RFP and 41.4 percent providing an RRO. Again the chain hotels displayed their technological edge with 73.5 percent of the chain hotels offering an RFP in contrast to 31 percent of the individual hotels (see Table 4). From those 51.4 percent offering a request for proposal, 28 percent had combined forms applicable for business and private purposes, 14 percent had forms exclusively tailored for business arrangements, 8 percent had separate forms for private and business events, and one only featured a form for private events.

186

Table 4. Technical Quality. Country of Origin Germany frequency

%

Switzerland frequency

%

Austria frequency

%

Total frequency

%

Chain frequency

% Individual frequency

%

Total frequency

%

34 3 23

92.8 8.2 62.1

28 9 20

75.7 24.3 54.1

26 11 14

70.3 29.7 37.9

88 23 57

79.3 20.7 51.4

50 3 39

94.3 5.7 73.6

38 20 18

65.5 34.5 31.0

88 23 57

79.3 20.7 51.4

14

37.9

17

45.9

23

62.1

54

48.6

14

26.4

40

69.0

54

48.6

13

35.1

15

40.5

18

48.6

46

41.4

11

20.8

35

60.3

46

41.4

24

64.9

22

59.5

19

51.4

65

58.6

42

79.2

23

39.7

65

58.6

30 29 25 15 25

88.3 85.3 73.5 44.1 73.5

26 25 20 15 27

92.8 89.3 71.4 53.6 96.4

21 21 14 10 19

80.8 80.8 53.8 38.4 73.1

77 77 59 40 71

87.5 87.5 67.1 45.5 80.7

45 42 37 24 40

90.0 84.0 74.0 48.0 80.0

34 35 22 16 31

89.5 92.1 57.9 42.1 81.6

77 77 59 40 71

87.5 87.5 67.1 45.5 80.7

10 0 19

43.5 0.0 82.6

2 0 7

10.0 35.0 53.6

4 1 4

28.8 7.1 28.8

16 1 31

29.0 1.8 54.4

11 0 20

28.2 0.0 51.3

5 1 11

27.8 5.5 61.1

16 1 31

29.0 1.8 54.4

5

21.7

2

10.0

2

14.3

9

15.8

6

15.4

3

16.7

9

15.8

MARCO A. GARDINI

I. Availability of online inquiry forms (n ¼ 111) Online booking form: Yes Online booking form: No Request for proposal form: Yes Request for proposal form: No Reservation request only form: Yes Reservation request only form: No II. Functions of online booking forms (n ¼ 88) Avaibility check Remarks section Member login Cancellation option Safe data transmission detail III. Type of request for proposal form ( ¼ 57) Business events only Private events only Joint business and private form Separate business and private forms

Afﬁliation

A Study on the Online Sales Efficiency of Upscale Hotels

187

Relating the variables technical quality vs. country of origin, the study found Swiss and German hotels technically slightly more advanced than their Austrian competitors in terms of the bare availability of alternative online request forms. The most outstanding result was that 92.8 percent of the German hotels provided an OBF in contrast to 75.7 percent of Swiss hotels and 70.3 percent of Austrian hotels. In regard to the ‘‘RFP’’ format, again Austrian hotels scored weaker than the other countries with only 37.9 percent of the hotels providing an RFP, while 54.1 percent of the Swiss hotels and 61.2 percent of the German hotels provided this online tool. A potential explanation for the outstanding results of the German hotels may be that the majority of participating hotels in Germany belonged to chains, but this was contradicted by the fact that the Swiss hotels scored better than the Austrian hotels despite of the fact that the majority of the participating hotels in Switzerland were privately owned whereas the Austrian sample was composed of half private and half corporate hotels. Only in terms of the ‘‘RRO’’ format, the Austrian hotels scored better than the Swiss or German hotels although on a generally low level. Here 48.6 percent of the Austrian, 40.5 percent of the Swiss and 35.1 percent of the German hotels provided such an online tool. A possible explanation for that may be that by offering more elaborate online formats like an OBF or an RFP, hotels in Germany and Switzerland consider an RRO format to be redundant.

CONCLUSION AND RECOMMENDATIONS The purpose of this paper was to test the responsiveness of hotels to online reservation inquiries made through the options offered by the companies’ corporate websites and to evaluate the hotels online sales performance in terms of the technical and process quality while dealing with a typical reservation request. Overall, 111 German, Swiss and Austrian four and ﬁve star hotels both individually owned and corporate, were approached with a ﬁctitious online reservation inquiry being asked to provide information on availability, prices, catering services and guest room facilities for a private event. In conclusion, the ﬁndings showed that the hotels surveyed are not utilizing their corporate websites to their full potential in marketing their hotels. In general, the study revealed that many hotels are losing potential revenue while missing the opportunity to effectively follow through with online reservation inquiries made via the hotels’ websites. The identiﬁed weaknesses include the overall range of responses and non-responses,

188

MARCO A. GARDINI

timeliness of answers and partly also the quality of replies. Furthermore, most hotels’ websites feature insufﬁcient possibilities of contact tool options, which should be provided by ﬁrms in greater diversity and sophistication so that customers are enabled to choose from a variety of contact alternatives and experience a greater degree of control. Individual hotels appear to be more attentive and customer oriented in their reactions to the inquiry, whereas chain hotels possess more technically elaborated website facilities. However, the majority of the hotels failed in capitalizing the advanced possibilities of the online setting in tangibilizing their products and service via multi-media devices. Most hotels included in this study did not provide any additional electronic material like guided virtual tours through the hotel, 3601 sights on guest rooms and/or surrounding areas or an online commercial. Very often banquet brochures, hotel information, photos or other additional material was not available in standard electronic formats (e.g. pdf; jpeg; mpeg). In some instances, a few hotels even went as far as to scan the hard copy version of their brochures or photos and send this – mostly poorly copied and hard to read material – as an attachment to their response mail. It is apparent that this far off from what potential customers expect from upscale and luxury hotels. Overall the study revealed a dissatisfactory sales performance of many hotels in regard to the hotels responsiveness in handling the online inquiry. The question which has to be posed now, why is this so and what are the managerial implications of this notion? Given the importance of the Internet as being substantial in acquiring new customers, the paucity of online sales capabilities may result in a competitive disadvantage for those hotels, which fail to fully utilize the beneﬁts of the Internet. The cost of missed opportunities goes far beyond the mere economic value of the speciﬁc inquiry. As Ho et al. (2003) put it, failing to reply or replying inadequately, may create the impression that the hotel does not want or need the new business brought by the inquirer. It may lead to the loss of present and future business, and if the hotel is part of a chain, losses for the afﬁliates of the chain. Furthermore, negative word-of-mouth is being spread by the potential client and his fellow customers with potentially harmful effects for the image of the single hotel or the corporate brand. In contrast, if reservation requests are being taken for serious and seen as a major marketing and sales opportunity rather than a non-committal customer–employee service encounter, hotels should take advantage of the full range of possibilities being provided by the Internet while trying to convert online leads into sales. The early adoption of online sales effectiveness might provide competitive advantage in the future when the hotel website will become the most

A Study on the Online Sales Efficiency of Upscale Hotels

189

Table 5. Online Sales Efﬁciency Improvement: Strategies for Hotel Marketers to Consider. Analyze the current marketing philosophy on reservation inquiries Analyse the current online and off-line sales processes and identify strengths and weaknesses Develop an online sales service blueprint, identify and deﬁne service phases, service features, service standards of online sales process Improve the integration of off-line and online sales, deﬁne and assign online and off-line sales responsibilities/leads (hotels, departments, central services, interfaces, employees) Implement online sales training (e.g. online sales techniques, the art of online response, customer orientation in the virtual moments of truth) Intensify service quality research on online service encounters and integrate online sales quality in the overall service quality system (e.g. customer e-satisfaction, employee feedback, mystery inquiry program)

important sales channel within the distribution network in the hospitality industry. It is suggested that hotel marketers reﬂect on the variables analyzed here, especially since the expected increase in the number of online hotel reservations in the upcoming years will be signiﬁcant. Online and off-line inquiries were and will be a major source of hotel revenue, which imposes the need for hotel marketers to understand the urge for an efﬁcient online and off-line sales transaction process. Table 5 lists recommendations for hotel marketers who want to increase their hotels inquiry conversion rates and need to adjust their sales processes in order to improve their online sales effectiveness. To summarize the items managers should be concentrating their efforts on the restructuring and/or optimization of the online sales process, the integration of online and off-line sales as well as on internal communication, training and intensiﬁcation of quality research and controlling in online service settings. In particular, hotels need not only to improve their web technology to ensure customer convenience, trust and control during the online transaction (inquiry or booking) but also to create internal awareness for the importance of responding appropriately to online and off-line inquiries.

LIMITATIONS AND FUTURE RESEARCH As with any study, there are limitations that must be considered in interpreting the results. First of all these limitations include the sample frame, the relatively small sample size and the fact that the hotels selected are not

190

MARCO A. GARDINI

necessarily representative for the German, Swiss and Austrian hospitality industry. Furthermore, the assessment of the quality of websites is a multidimensional issue, whereas the investigation here was limited to the speciﬁc sales transaction capabilities of the selected hotel websites. Based on the literature review a set of variables was developed in order to assess the overall online sales process quality (process aspects and technical tools) with regard to what a potential customer may encounter when attempting to make a deﬁnite booking or reservation request. The ﬁndings therefore are limited to the items included in this study as the used set of variables has not been developed on the basis of a speciﬁc customer interrogation on online sales quality. Additionally, the research stated that the lack of responsiveness of hotels to online reservation inquiries being shown in this study may reﬂect some organizational problems. The study gave some indications on that matter, but as this issue was not the core of the study it only can be stated with great caution. Future research on online service encounters and inquiry conversion therefore has to unfold an external and internal perspective. First of all, research needs to explore, if the items selected are reliable and valid in terms of affecting the perceived service quality of potential customers making reservation requests. Extending this, what are the expectations of potential customers in online service encounters and how much does the outcome of this type of service encounter affect image, loyalty and online/off-line purchase intentions? Furthermore, the needs and expectations of different customers groups in regard to their desired service quality level in online service encounters have to be identiﬁed as website service quality perceptions may vary across socio-demographic groups. What is the desired response time? Is speed more important to younger people than older people, to male or to female customers? Acknowledging the fact that there are cultural differences in the perception of time (monochrone vs. polychrone), how does this apply in the technological setting of the Internet and hence in the evaluation of online service encounters? Second, research has to explore the issue of why the outcome of online service encounters has to be considered as dissatisfactory when it comes down to responding adequately to online reservation inquiries. For example, why are some hotels and/or hotel employees apparently making the critical decision that an online or off-line reservation inquiry is not worth responding to? And why is the reply quality so poor, with information very often not tailored to the speciﬁc inquirers need? Is this an organizational problem with online sales channels which are not integrated well enough into the hotels overall sales processes or is it a managerial problem reﬂecting a scarcity of

A Study on the Online Sales Efficiency of Upscale Hotels

191

marketing mindedness, which in consequence produces a lack of employee motivation and commitment in handling reservation inquiries? While these matters were not the focus of this study they surely warrant further research in order to understand the future online sales challenges in the hospitality industry while information technology and e-marketing are progressing to the next level. Despite of the cautions being discussed the clear message is that hotel sales and marketing managers need to assess their ﬁrms relative to the factors that make an online reservation inquiry either more or less attractive for a potential customer and then develop an integrated online and off-line sales concept that serves the ﬁrm’s marketing objectives and operational needs.

REFERENCES Baloglu, S., & Pekcan, Y. A. (2006). The website design and internet site marketing practices of upscale and luxury hotels in Turkey. Tourism Management, 27, 171–176. Barnes, S., & Vidgen, R. (2000). WebQual: An exploratory study of website quality. In: European conference on information systems. Vienna: Vienna University for Economics and Business Administration. Caroll, B., & Siguaw, J. (2003). The evolution of electronic distribution: Effects on hotels and intermediaries. Cornell Hotel and Restaurant Administration Quarterly, 44(3), 38–50. Chung, T., & Law, R. (2003). Developing a performance indicator for hotel websites. International Journal of Hospitality Management, 22(1), 119–125. Churchill, G. A., & Iacobucci, D. (2005). Marketing research: Methodological foundations (9th ed.). Ohio: Thomson South-Western. DEHOGA. (2005). Deutscher Hotel und Gaststa¨ttenverband: Jahrbuch 2004/2005. Grohmann, H. V. (1966). Answering reservation inquiries. Cornell Hotel and Restaurant Administration Quarterly, 7(2), 73–80. Gro¨nroos, C. (1984). A service quality model and its marketing implications. European Journal of Marketing, 18(4), 36–44. Guide Michelin. (2004). Der Hotel – und Restaurantfu¨hrer ‘‘Michelin’’ Edition Deutschland, Karlsruhe. Hartley, J. S., & Witt, S. F. (1992). Hotel sales management: Turning conference and function enquiries into sales. Journal of Hospitality and Leisure Marketing, 1(2), 59–75. Hartley, J. S., & Witt, S. F. (1994). Increasing the conversion rate of conference and function enquiries into sales. International Journal of Hospitality Management, 13(3), 275–285. Ho, K., Jacobs, L., & Cox, J.(2003). Go away! Don’t bother me! I don’t want your money! Journal of Services Marketing, 17(4), 379–392 Hotelmarkt Deutschland. (2004). Branchenreport des Hotelverband Deutschland (IHA) e.V. Bonn. Hsu, C. H., & Powers, T. (2002). Marketing hospitality (3rd ed.). New York: Wiley. Hsu, K., Zhu, Z., & Agrusa, J. (2004). Turning click-through visitors into customers: A study of Chinese hotel websites. Journal of Hospitality and Leisure Marketing, 11(4), 81–91. IHA Hotelfu¨hrer. (2004). Hotelfu¨hrer des Hotelverbands Deutschland (IHA). Berlin.

192

MARCO A. GARDINI

Kayanama, S. A., & Black, C. I. (2000). A proposal to assess the service quality of online travel agencies: An exploratory study. Journal of Professional Services Marketing, 21(1), 63–88. Kim, W. G., & Kim, D. J. (2004). Factors affecting online hotel reservation intention between online and non-online customers. International Journal of Hospitality Management, 23, 381–395. Lociacono, E., & Watson, R. T. (2000). WebQualTM: A website quality instrument. Working Paper, Worcester Polytechnic Institute. Morgan, N. A. (1992). The marketing quality management interfaces. In: P. Kunst, & J. Lemmink (Eds), Quality management in services (pp. 15–28). Assen/Maastricht. O’Conner, P., & Frew, A. J. (2002). The future of hotel electronic distribution: Expert and industry perspectives. Cornell Hotel and Restaurant Administration Quarterly, 43(2), 33–45. Olsen, M. D., & Conolly, D. J. (2000). Experience-based travel: How technology is changing the hospitality industry. Cornell Hotel and Restaurant Administration Quarterly, 41(1), 30–40. ServiceQualita¨t Niedersachsen. (2006). Eine Bestandsaufnahme der ServiceQualita¨t Touristischer Leistungstra¨ger in Niedersachsen. Hannover: Tourismus Marketing Niedersachsen GmbH. Shim, S., Eastlick, M. A., Lotz, S. L., & Warrington, P. (2001). An online pre-purchase intentions model: The role of intention to search. Journal of Retailing, 77(3), 397–416. Stergiou, D., & Airey, D. (2003). Inquiry conversion and tourism website effectiveness: Assumptions, problems and potential. Tourism and Hospitality Research, 4(4), 355–365. Sweeney, J. C., & Lapp, W. (2004). Critical service quality encounters on the web: An exploratory study. Journal of Services Marketing, 18(4), 276–289. Tierney, P. (2000). Internet-based evaluations of tourism website effectiveness: Methodological issues and survey results. Journal of Travel Research, 39(2), 212–219. Ulysses. (2003). Web-Tourismus 2003, Mu¨nchen. Varta. (2004). Der Varta Fu¨hrer, Ostﬁldern-Kemnat. Veverka, B. (1995). Golden opportunity: Turning inquiries into bookings. Lodging, November, pp. 145–148. Zeithaml, V. A., Berry, L. L., & Parasuraman, A. (1996). The behavioural consequences of service quality. Journal of Marketing, 60(4), 31–46. Zeithaml, V. A., Parasuraman, A., & Malhotra, A. (2001). A conceptual framework for understanding e-service quality: Implications for future research and managerial practice. Working Paper, Report No. 00-115, Marketing Science Institute, Cambridge, MA.

AN INVESTIGATION OF LONGTERM DEBT AND FIRM VALUE IN THE LODGING INDUSTRY Michael C. Dalbor, Seoki Lee and Arun Upneja ABSTRACT The purpose of this paper is to explore the impact of long-term debt and firm value in the lodging industry. Previous research on capital structure in the lodging industry has been conducted in an attempt to understand what motivates the use of debt. We explore this further by assessing whether or not this debt use translates into increases in firm value. The regression analysis shows that after controlling for size and risk, we find a positive relationship with long-term debt and the value of the firm. Return on assets is negatively related to firm value, but capital expenditures are not.

INTRODUCTION The purpose of this research is to investigate the relationship between longterm debt and ﬁrm value in the U.S. lodging industry. Debt is thought to be used up to the point where the marginal costs of debt are equal to the marginal beneﬁts. While debt increases the riskiness of the ﬁrm, it also increases shareholder return. Either too little or too much debt can negatively impact Advances in Hospitality and Leisure, Volume 3, 195–204 Copyright r 2007 by Elsevier Ltd. All rights of reproduction in any form reserved ISSN: 1745-3542/doi:10.1016/S1745-3542(06)03011-6

195

196

MICHAEL C. DALBOR ET AL.

shareholder wealth. Moreover, the speciﬁc effect of the level of debt on the value of publicly traded lodging ﬁrms is yet unknown. Therefore, the question this study attempts to address is does long-term debt increase the value of lodging ﬁrms? Long-term debt is commonly used in the lodging industry so understanding the motivations for its use is an important area of research. Dalbor and Upneja (2004) ﬁnd that, on average, 41 percent of the assets of lodging ﬁrms are ﬁnanced with long-term debt. This number is associated with a standard deviation of 24 percent, indicating that some ﬁrms have a much higher longterm debt ratio. There are a number of reasons for the prevalence of longterm debt in the lodging industry. One is the notion that ﬁrms attempt to match the life of their assets with liabilities. Thus, ﬁnancing with long-term debt is an attempt to match with the long life of ﬁxed assets. Another reason may be the ‘‘pecking-order’’ theory of ﬁnancing as suggested by Myers (1977, 2001). It should be noted that these ideas are not mutually exclusive or comprehensive in their explanatory power. A potential contribution of this study is an understanding of what helps drive the value of lodging ﬁrms. Additionally, the results may help develop a better understanding of the capital structure decision of the U.S. lodging ﬁrms. This paper is organized in the following manner. The second section will discuss the literature related to the reasons for the use of debt. The third section will discuss the data used and the methodology employed. The next section will discuss the results of the statistical analysis and the ﬁnal section will provide conclusions and recommendations for further research. Although debt can be used to increase shareholder return, it can also cause agency problems as discussed by Jensen and Meckling (1976). The use of debt can encourage the problem of asset substitution where shareholders receive the upside of any potential risky investment with most of the downside potential absorbed by the debtholders. Thus, the use of debt requires the ﬁrm to incur agency costs in the form of covenants and monitoring actions. Even though debt comes with speciﬁc agency costs, debt can be used as a way to reduce the agency costs between shareholders and management. As argued by Jensen (1986), interest payments are effective constraints on the free cash ﬂow of the ﬁrm. Therefore, these payments can help prevent management from ‘‘empire building’’ at the expense of the shareholders. This type of activity would include consumption of perquisites acquiring assets just for the sake of acquisition. This may be one of the reasons large ﬁrms use more debt, including the use of long-term debt by lodging ﬁrms as found by Dalbor and Upneja (2004).

Long-Term Debt and Firm Value in the Lodging Industry

197

As previously discussed, Myers (1977, 2001) proposes a ‘‘pecking-order’’ theory of capital structure that is based upon cost effective choices. The most cost effective and easiest method of ﬁnancing is the use of retained earnings. However, this type of ﬁnancing is rarely available to start-up ﬁrms or ﬁrms that may have incurred recent losses and a reduction of retained earnings. The next choice is debt that has costs associated with it, but can be quite ﬂexible. It does not always require the ﬁrm to go public with a security offering (instead utilizing a mortgage or a bank loan) and offers the tax deductibility of interest payments. The least favorite choice is new external equity because of the high costs associated with new stock issues. Accordingly, Myers (2001) argues that ﬁrms with high growth opportunities do not use a lot of debt. The classic example is a pharmaceutical company that wants to reinvest earnings into research and development as opposed to being forced to make interest payments to lenders. This conclusion was thought to be applicable to ﬁrms across all industries as researched by Barclay and Smith (1995). However, as discussed by Myers (2001), capital structure theories may not be able to be widely applied. Moreover, Gaver and Gaver (1993) believe that growth opportunities are not homogeneous. Accordingly, research by Upneja and Dalbor (2001) shows a positive relationship between debt and growth opportunities for lodging ﬁrms. This ﬁnding was further conﬁrmed in a study by Tang and Jang (2007). Thus, if a ﬁrm uses the correct amount of debt, this will beneﬁt the ﬁrm by balancing the increased shareholder returns with the agency costs of additional debt. Moreover, based upon Myers (2001), it may signal the market about the growth opportunities for the ﬁrm. In the speciﬁc case of the lodging industry as found by Upneja and Dalbor (2001), more debt may indicate more growth opportunities for lodging ﬁrms that could increase ﬁrm value. While we are primarily interested in effect of debt on ﬁrm value, we must consider anything that directly or indirectly impacts the three factors that affect shareholder wealth. Risk is one of three key factors used when examining shareholder value. Uncertainty has a negative impact on ﬁrm value. In the famous case of Enron, one of the ﬁrst signs of trouble was when analysts could not understand how Enron was generating its earnings (McLean, 2001). This uncertainty increased after the resignation of Enron’s CEO in August 2001. When it was all over, Enron lost $65 billion dollars in shareholder wealth between December 2000 and December 2001 (Kastantin, 2005). While some researchers use standard deviation of return or income for a proxy for volatility (Supanvanij, 2006), others use measures of potential bankruptcy (Ohlson, 1980; Begley, Ming, & Watts, 1996; Hillegeist, Keating, Cram, & Lundstedt, 2004).

198

MICHAEL C. DALBOR ET AL.

Another risk-related consideration is ﬁrm size. Larger ﬁrms are generally more diverse and less prone to failure. As suggested by Supanvanij (2006), ﬁrm size may be an inverse bankruptcy predictor. Additionally, larger ﬁrms are often more established and there is less information asymmetry about their operations in the marketplace. Therefore, it seems likely that this additional certainty will add to shareholder value. The lodging industry is known for its significant investments in ﬁxed assets. Because these assets generate earnings, cash ﬂows and potential dividends, their maintenance and upkeep in terms of capital expenditures is critical. Therefore, one might expect that higher capital expenditures would increase the wealth of lodging investors. A positive relationship between capital expenditures and ‘‘excess value’’ (above average shareholder value) was found for a large sample of ﬁrms by Ruland and Zhou (2005). Earnings must also play a role in ﬁrm value. If earnings are not important to the market, why did ﬁrms such as Enron and Worldcom spend so much time and energy manipulating them? The answer is that earnings are very important to the market for ﬁrm valuation. Empirical research by Lev and Zarowin (1999) indicate that earnings are more correlated with stock prices than other commonly used measure such as cash ﬂows. Accordingly, earnings should play a role in determining shareholder value. Earnings are typically standardized by sales (Ruland & Zhou, 2005) or total assets (Supanvanij, 2006) in empirical studies. The relationship between debt and earnings is not entirely clear and is one of the motivations for this research. The ﬁnancial literature has examined debt as a factor that inﬂuences ﬁrm performance as well as the other way around. For example, Supanvanij (2006) uses a measure of profitability (the ratio of operating income to total assets) as an agent affecting the use of longterm debt by Asian ﬁrms. He ﬁnds a negative relationship between proﬁtability and long-term debt for all Asian ﬁrms, although it is only modestly significant. However, a significant negative relationship is found for Japanese ﬁrms alone. Thus, highly profitable Japanese ﬁrms use less debt. On the other hand, Abor (2005) examines the relationship between debt and return on equity for ﬁrms in Ghana using a number of debt measures as independent variables in regression models. His ﬁndings are interesting in that he ﬁnds a negative relationship between long-term debt and return on equity (ROE), but a positive relationship between short-term debt and ROE. Thus, ﬁrms that use more long-term debt have a lower ROE. Ruland and Zhou (2005) examine the relationship between debt, diversiﬁcation and ﬁrm value. Although their focus is on diversiﬁcation, they assess how long-term debt affects a ﬁrm’s ‘‘excess value’’. Excess value is deﬁned as a

Long-Term Debt and Firm Value in the Lodging Industry

199

ﬁrm’s market value above and beyond the average for its industry. Their results indicate a significantly negative relationship between long-term debt and excess market value. This result is similar to Abor (2005) in that longterm debt appears to reduce shareholder value.

METHOD AND RESULTS The purpose of this study is to determine whether or not the use of longterm debt contributes to the value of lodging ﬁrms. Therefore, the regression equation to determine this relationship is as follows: Firm Valuet ¼ a0 þ a1 LTD þ a2 RISK t þ a3 CAPEX t þ a4 NITAt þ a5 SIZE þ et where Firm Value is the natural log of the market value of ﬁrm equity, LTD the ratio of long-term debt to total assets, RISK Ohlson’s O Score, CAPEX the ratio of capital expenditure to total assets, NITA the ratio of net income to total assets, SIZE the log of the net book value of the ﬁrm and e the error term of the regression. To assess the sensitivity of the regression model variable speciﬁcation, we use other variables as well. For example, we use three different variables to measure risk. While all of them are based on a probability bankruptcy as developed by Ohlson (1980), we also use coefﬁcients as speciﬁed by Begley et al. (1996) as well as Hillegeist et al. (2004). Our sample is derived from the COMPUSTAT database. Annual data are obtained for the U.S. lodging ﬁrms for the years 1980 through 2005. We present descriptive statistics, a correlation matrix of the variables and the results of the regression models in the next section. Descriptive statistics for our sample are shown in Table 1. One of the most interesting statistics in the table is the average long-term debt ratio. For our sample the average is 38 percent which is very similar to the percentage found by Dalbor and Upneja (2004). This indicates the continuing importance of long-term debt to the lodging industry. The correlation matrix of the variables follows in Table 2. We show the results of the three ﬁnal regression models where the natural log of the market value of equity is the dependent variable for each model. As previously discussed, we used different measures of risk by using variations of Ohlson’s O Score. It should be noted that when we ﬁrst ran the regression models we discovered the presence of serial correlation because

200

MICHAEL C. DALBOR ET AL.

Table 1.

Descriptive Statistics of the Sample.

Variable

N

Mean

SD

Minimum

Maximum

MVE LogMVE NBV LogNBV LTD Risk 1 Risk 2 Risk 3 CapEx NITA

497 497 497 497 497 497 497 497 497 497

880.4 4.25 444.11 4.14 .38 2.34 .73 5.67 .20 .01

2,217 2.48 1,155 2.19 .25 3.12 5.45 .72 .32 .13

.11 2.21 769.95 1.96 0 30.97 108.33 9.44 0 1.00

14,221 9.56 8,425 9.04 1.16 32.87 3.56 2.78 4.64 1.48

Note: The table shows the mean, standard deviation, minimum and maximum values for the variables used in the regression models. MVE, the market value of equity; LogMVE, the natural log of the market value of equity; NBV, the net book value of the ﬁrm’s assets; LogNBV, the natural log of the net book value of the ﬁrm’s assets; LTD, the ratio of long-term debt to total assets; Risk 1, Ohlson’s O score using the original coefﬁcients; Risk 2, Ohlson’s O Score using the re-estimated coefﬁcients by Begley et al. (1986); Risk 3, the O Score using the updated coefﬁcients by Hillegeist et al. (2004); CapEx, the ratio of capital expenditures to sales; NITA, net income divided by total assets.

each ﬁrm was evaluated over a period of time. We used the AUTOREG procedure in SAS to correct this. Therefore, each of the regressions contains two autoregressive terms that were included to correct for serial correlation. Additionally, we attempted to assess any effects of economic recessions or expansions by splitting the sample into certain time periods. These regressions did not provide significantly different results from those presented in Table 3. The ﬁrst model uses Ohlson’s original O Score as a proxy for risk. It is not significant in the model. The long-term debt ratio is only modestly significant in this model along with return on assets (NITA). The interesting ﬁnding here is the negative sign of the return on assets coefﬁcient. This indicates that the lower the return on assets, the higher the ﬁrm value. The a priori expectation was the opposite. The size variable is significantly positively related to ﬁrm value, but capital expenditures are not. The second regression model only varies from the ﬁrst because of the different measure of risk. This variable is highly significant in the regression, along with the long-term debt ratio. The only key difference is that the sign of the Risk 2 coefﬁcient is negative. The sign is as expected, indicating that higher the probability of bankruptcy, lower the market value of the ﬁrm. All of the variables are significant with the exception of the capital expenditure ratio. Once again, the return on assets coefﬁcient is significant and negative.

MVE LogMVE NBV LOGNBV LTD Risk 1 Risk 2 Risk 3 CapEx NITA

MVE

LogMVE

NBV

LogNBV

LTD

Risk 1

Risk 2

Risk 3

CapEx

.66 .90 .64 .14 .25 .03 .01 .05 .11

.61 .92 .02 .36 .08 .10 .14 .20

.65 .16 .26 .03 .01 .02 .10

.02 .39 0.00 .14 .14 .19

.31 .03 .15 .08 .06

.32 .09 .08 .65

.30 .01 .13

.01 .07

.04

Note: The table shows the Pearson correlation coefﬁcients for the variables used in the regression models. MVE, the market value of equity; LogMVE, the natural log of the market value of equity; NBV, the net book value of the ﬁrm’s assets; LogNBV, the natural log of the net book value of the ﬁrm’s assets; LTD, the ratio of long-term debt to total assets; Risk 1, Ohlson’s O Score using the original coefﬁcients; Risk 2, Ohlson’s O Score using the re-estimated coefﬁcients by Begley et al. (1986); Risk 3, the O Score using the updated coefﬁcients by Hillegeist et al. (2004); CapEx, the ratio of capital expenditures to sales; NITA, net income divided by total assets. Significant at .10. Significant at .05. Significant at .01.

Long-Term Debt and Firm Value in the Lodging Industry

Table 2. Correlation Matrix for the Variables Used in the Regression Models.

201

202

MICHAEL C. DALBOR ET AL.

Table 3.

Regression Analysis Results.

Regression Intercept LTD Risk 1 1 2 3

.64 .61 .68

.35 .38 .36

.01 – –

Risk 2 – .01 –

Risk 3 CapEx – – .01

.07 .06 .07

NITA .67 .90 .76

LogNBV R2 (%) .90 .91 .90

73.5 74.1 73.4

Note: The table shows the regression analysis coefﬁcients for the variables used in the regression models. The dependent variable in all three regressions is the natural log of the market value of equity. LTD, the ratio of long-term debt to total assets; Risk 1, Ohlson’s O Score using the original coefﬁcients; Risk 2, Ohlson’s O Score using the re-estimated coefﬁcients by Begley et al. (1986); Risk 3, the O Score using the updated coefﬁcients by Hillegeist et al. (2004); CapEx, the ratio of capital expenditures to sales; NITA, net income divided by total assets; LogNBV, the natural log of the net book value of the ﬁrm’s assets and is a proxy for ﬁrm size. Significant at .10. Significant at .05. Significant at .01.

The third regression model mirrors the results of the ﬁrst regression model. The risk variable is not significant and the long-term debt ratio is modestly significant and positive. Moreover, the capital expenditure ratio has no effect on ﬁrm value. Finally, the only major difference is that the return on assets variable is most significant in this model.

CONCLUSIONS The purpose of this research is to assess the effect of long-term debt on the market value of lodging ﬁrms. The a priori expectation was to ﬁnd a positive relationship between long-term debt and ﬁrm value. We ﬁnd modest support for this notion. This ﬁnding contradicts results found by Abor (2005). However, given the ﬁxed asset intensive nature of the lodging industry, these assets are often ﬁnanced with debt and therefore lodging investors may react positively to its presence. Other possibilities exist to explain the positive relationship between long-term debt and ﬁrm value found in this study. One is that it is not known if the existing literature included lodging ﬁrms in their samples. Another is that the relationship between debt and ﬁrm value could be quadratic similar to the notion posited by Pandey (2004) regarding debt and market power. A more detailed investigation into the speciﬁc shape of the relationship between debt and value could be fruitful. Two results from our models are somewhat puzzling. We do not ﬁnd that the ratio of capital expenditures to assets is related in any way to ﬁrm value.

Long-Term Debt and Firm Value in the Lodging Industry

203

This requires further research as conventional wisdom indicates the need for capital expenditures to be made to remain competitive in the lodging industry. The other is that return on assets is negatively related to ﬁrm value. This contradicts ﬁndings such as those by Lev and Zarowin (1999) that show earnings are more highly correlated with stock prices than cash from operations. However, it should be noted that the variable used in our models was standardized by total assets. It may be the case that investors are rewarding those ﬁrms that make significant investments in ﬁxed assets which could drive the return on assets ratio lower. Nevertheless, additional research into the importance of capital expenditures and accrual-based earnings to the investing marketplace is clearly warranted.

REFERENCES Abor, J. (2005). The effect of capital structure on profitability: An empirical analysis of ﬁrms listed in Ghana. The Journal of Risk Finance, 6, 438–445. Barclay, M., & Smith, C., Jr. (1995). The maturity structure of corporate debt. Journal of Finance, 50, 609–631. Begley, J., Ming, J., & Watts, R. (1996). Bankruptcy classiﬁcation errors in the 1980’s: An empirical analysis of Altman’s and Ohlson’s models. Review of Accounting Studies, 1, 267–284. Dalbor, M., & Upneja, A. (2004). The investment opportunity set and the long-term debt decision of U.S. lodging ﬁrms. Journal of Hospitality and Tourism Research, 28, 346–355. Gaver, J., & Gaver, K. (1993). Additional evidence on the association between the investment opportunity set and corporate ﬁnancing, dividend and compensation policies. Journal of Accounting and Economics, 16, 125–160. Hillegeist, S., Keating, E., Cram, D., & Lundstedt, K. (2004). Assessing the probability of bankruptcy. Review of Accounting Studies, 9, 5–34. Jensen, M. (1986). Agency costs of free cash ﬂow, corporate ﬁnance and takeovers. American Economic Review, 76, 323–329. Jensen, M., & Meckling, W. (1976). Theory of the ﬁrm: Managerial behavior, agency costs and ownership structure. Journal of Financial Economics, 3, 305–360. Kastantin, J. (2005). Beyond earnings management: Using ratios to predict Enron’s collapse. Managerial Finance, 31, 35–51. Lev, B., & Zarowin, P. (1999). The boundaries of ﬁnancial reporting and how to extend them. Journal of Accounting Research, 37, 353–385. McLean, B. (2001). Is Enron overpriced? Fortune, 143(March 5), 122–125. Myers, S. (1977). The determinants of corporate borrowing. Journal of Financial Economics, 5, 147–175. Myers, S. (2001). Capital structure. Journal of Economic Perspectives, 15, 81–102. Ohlson, J. (1980). Financial ratios and the probabilistic prediction of bankruptcy. Journal of Accounting Research, 18, 109–131. Pandey, I. (2004). Capital structure, profitability and market structure: Evidence from Malaysia. Asia Pacific Journal of Economics and Business, 8, 78–91.

204

MICHAEL C. DALBOR ET AL.

Ruland, W., & Zhou, P. (2005). Debt, diversiﬁcation and valuation. Review of Quantitative Finance and Accounting, 25, 277–291. Supanvanij, J. (2006). Capital structure: Asian ﬁrms vs. multinational ﬁrms in Asia. Journal of American Academy of Business, 10, 324–330. Tang, C., & Jang, S. (2007). Revisit to the determinants of capital structure: A comparison between lodging ﬁrms and software ﬁrms. International Journal of Hospitality Management, 26, 175–187. Upneja, A., & Dalbor, M. (2001). The choice of long-term debt in the U.S. lodging industry. Journal of HTL Science 1. Retrieved from www.unlv.edu/Tourism/HTLScience.

ENERGY CONSUMPTION AND CO2 CONTRIBUTION BY INTERNATIONAL TRAVELERS Li-Ju Chen and Joseph S. Chen ABSTRACT This research aims to assess the energy use and CO2 contribution and depict the international visitors’ environmental impacts of flight transportation in Taiwan. Two elements entailing the energy consumption and CO2 contribution of flight transportation of international travelers of Taiwan revealed the environmental impact caused by international travelers in 2004. The number of outbound visitors of Taiwan was over twice the number of inbound visitors of Taiwan in 2004. The total energy use of international visitors of Taiwan for one-way trip is 74.44 PJ. The total CO2 contribution of international visitors for one-way trip is 5136.54 kilotons. The results show that distance is the key determinant of energy consumption and CO2 contribution by international tourists.

INTRODUCTION The tourism business is one of the fastest growing industries in Asia and contributes economic beneﬁts to many Asian countries. For example, international tourist arrivals could bring a direct foreign income to the hosting nations. In 2005, international tourism generated approximately 808 million Advances in Hospitality and Leisure, Volume 3, 205–216 Copyright r 2007 by Elsevier Ltd. All rights of reproduction in any form reserved ISSN: 1745-3542/doi:10.1016/S1745-3542(06)03012-8

205

206

LI-JU CHEN AND JOSEPH S. CHEN

trips worldwide, and Northeast Asia shared 10.8% (WTO, 2006). Tourism industry has long been regarded as a green industry or an industry without chimneys comparing to manufacturing business. Ironically, tourism operations require a great deal of nature resources to support the facilities as well as entice the tourists’ demands. Water, for example, is heavily consumed by theme parks and hotels. Tourist trip involves transportation that takes the tourists to the destinations and back to home. Furnishing such a vital service will have to use bountiful nonrenewable natural resources such as gasoline. Many island countries, like Taiwan, highly depend on air transportation to serve their international travel market. The mass tourists certainly help boost local economy in principle. Nevertheless, from the sustainable development point of view, are international travels environmentally sustainable? Many researchers revealed the tourists’ environmental impacts by the perceptions of the host community. However, the paucity of literature has assessed the physical impacts due to tourism. This research attempts to measure the energy use and CO2 contribution by international air trafﬁc and depict the international tourists’ environmental impacts by ﬂight transportation in Taiwan.

Tourist’s Environmental Impact Many researchers revealed that tourists’ behaviors may cause direct and indirect environmental impact during their trips, especially in natural-based destinations (Go¨ssling, 2002; Noe, Hammitt, & Bixler, 1997; Cohen, 1978). The direct environmental impact derived from tourism development is erosion of natural surrounding, vandalism, pollution, and incidental wear and tear (Liddle, 1997; Hammitt & Cole, 1998). Yet, tourists bring more indirect environmental impact through transportation, consumption styles, and activities they were engaged in. Travel involves mobility which often promotes the consumption of fossil fuels or other types of natural resources. Regarding consumption styles, tourists may buy or taste endangered animal products which speed the extinction of the species. To sustain the business, tourism vendors might need to provide a variety of recreational activities and facilities such as hiking, horse riding, scuba diving, and boating to satisfy tourists which invite direct environmental impacts. Lange’s research in Tyrol, Austria (1995) found that tourists caused the environmental burdens; 40–60% of the impact occurred in transportation; 20–30% in facilities for accommodations, restaurants, and other services; 20–30% in tourists’ leisure and recreation activities (as cited in Hfyer, 2000). A large part of environmental burden was on transportation section.

Energy Consumption and CO2 Contribution by International Travelers

207

Lenzen (1999) assumed that 25–65% of indirect energy requirement of transportation was attributed to passenger transport. Some studies indicated that the ﬂight transportation contributes the most environmental impacts among all categories of international trips (Hunter, 2002; Hunter & Shaw, 2007; WWF-UK, 2002).

Globally Environmental Impact in Air Travel The environmental issues related to air travel are noise and energy usage. Noise problems occur during the take off and landing. It is usually a local environmental problem. On the contrary, the energy usage involved is a more global concern. Regarding the energy usage, 2–3% of the total fossil fuels usage was for aviation with over 80% of aviation usage accounts for civil aviation (IPCC, 1999). The major by-products of aircraft are emission of greenhouse gases carbon dioxin (CO2) and water vapor (H2O). These two are directly related to global warming. Other emissions are nitric oxide (NO), and nitrogen dioxide (NO2) (which together are termed NOx), sulfur oxides (SOx), and soot. These gases and particles not only contribute to the greenhouse effect but also trigger the formation of condensation trails (contrails). All these may cause increased cirrus cloudiness and change the climate (IPCC, 1999). Furthermore, the injection of NOx in upper troposphere and lower stratosphere (at altitudes of about 9–13 km, which is the subsonic aircraft ﬂight height) also disturbs the ozone chemistry (IPCC, 1999). Although O3 is a greenhouse gas, it also shields the surface of the earth from harmful ultraviolet (UV) radiation. According to Houghton (2004), transportation contributes 25% of greenhouse effect worldwide and 13% of this portion is from air transport. Intergovernmental Panel on Climate Change (IPCC, 1999) estimated that global passenger air travel (as measured in revenue passenger-km) grows at about 5% per year between 1990 and 2015. Largely due to improvement of aircraft efﬁciency, the total aviation fuel use – including passenger, freight, and military – is projected to increase by 3% per year over the same period of time (IPCC, 1999). But the scenario is under the assumption that the improvement of technology is materialized and the infrastructures (such as aircrafts and airports and associated infrastructures) continue to grow. The increased fuel efﬁciency seems unlikely to catch up the speed of increased demand of air transport (Houghton, 2004). In summary, the environmental impact of aviation would increase along with our increasingly demand of international travels.

208

LI-JU CHEN AND JOSEPH S. CHEN

This paper strives to examine the energy consumption relating to international travels including outbound and inbound travelers in Taiwan. From the global point of view, air travels would increase the greenhouse gases that are related to global warming. Therefore, two measurable elements the energy consumption and CO2 contribution of ﬂight transportation of international travelers of Taiwan were calculated to understand the environmental impact caused by international travelers. Study Site Taiwan is an island located on the west edge of Paciﬁc Ocean with approximately 36,000 km2 (14,400 square miles). Two-thirds of the total area is covered by forested mountains and the remaining area consists of hilly country, platforms and highlands, coastal plains and basins. The Central Mountain Range stretches along the entire island from north to south. On the west side lies the Yushan Mountain Range with its main peak reaching 3,952 m, the highest mountain peak in Northeast Asia. There are many different climate types in Taiwan including tropical, subtropical, and temperate. There are about 18,400 species of wildlife on the island, with more than 20% belonging to rare or endangered species (Tourism Bureau of Taiwan, 2006). It attracts international tourists by its unique culture and abundant natural resources. Regarding the international visitors to Taiwan, the statistical data from the Tourism Bureau of Taiwan (2004a, 2004b) shows the number of inbound visitors’ arrivals in Taiwan from 1985 to 2004 and the amount of inbound visitors’ expenditures (USD) per year (see Figs. 1 and 2). In 2003, the number of inbound visitors’ arrivals and expenditure decreased dramatically because of the prevalence of severe acute respiratory syndrome (SARS). The SARS epidemic signiﬁcantly affected the tourism business in Asia. The ﬁgures show that the growth of the number of inbound visitors’ arrivals and expenditures increases every year steadily except in 2003. In 2004, the total number of inbound visitors’ arrivals in Taiwan was 2,950,342, and the expenditure was around 4 billion dollars. Fig. 3 shows the percentage of inbound visitors’ arrivals in Taiwan in 2004 by their residency. It indicates that the most inbound visitors who arrived in Taiwan were from Asia (77%). Japan (30.1%), Hong Kong and Macao (14.1%), and the United States (13%) were the top three tourist generating countries. In 2004, total number of Taiwanese citizens made oversee trips (outbound travels) was 7,780,652 (Tourism Bureau of Taiwan, 2004c). Fig. 4 shows the

Energy Consumption and CO2 Contribution by International Travelers

209

3.500 3.000 2.500

y = 0.0659x + 1.4982 2 R = 0.8239

2.000 1.500 1.000

No. of tourists (million) Linear (No. of tourists (million))

0.500

Y ea r 19 85 19 86 19 87 19 88 19 89 19 90 19 91 19 92 19 93 19 94 19 95 19 96 19 97 19 98 19 99 20 00 20 01 20 02 20 03

0.000

Fig. 1.

The Number of Inbound Visitors’ Arrivals in Taiwan per Year from 1985 to 2004.

y = 151.9x + 1315.8 R2 = 0.7978

tourists expenditures (Million USD) Linear (tourists expenditures (Million USD))

Y ea r 19 85 19 86 19 87 19 88 19 89 19 90 19 91 19 92 19 93 19 94 19 95 19 96 19 97 19 98 19 99 20 00 20 01 20 02 20 03

5000 4500 4000 3500 3000 2500 2000 1500 1000 500 0

Fig. 2.

The Amount of Inbound Visitors’ Expenditure in Taiwan per Year from 1985 to 2004.

percentage of outbound visitors’ departures by their destinations. A majority (82.6%) of outbound visitors went to other Asian countries. The most popular destinations were Hong Kong (32.9%), Japan (13.5%), Macao (13.3%), and the United States (6.9%).

METHOD AND ANALYSIS This study aims to assess the energy use and carbon dioxin contribution caused by air travel of international visitors from and to Taiwan in 2004. To clarify the terms, the deﬁnition of visitors and tourists from the United

210

LI-JU CHEN AND JOSEPH S. CHEN

Oceania, 1.7% Europe, 5.6%

Africa, 0.3% Unclear, 0.1%

America, 15.1%

Asia, 77.1%

Fig. 3.

The Percentage of Inbound Visitors’ Arrivals in Taiwan by Residency, 2004. Oceanic, 1.8%

Africa, 0.0% Others, 3.9%

Europe, 3.3% America, 8.3%

Asia, 82.6%

Fig. 4.

The Percentage of Outbound Visitors’ Departures by their Destinations, 2004.

Nations World Tourism Organization (Goeldner & Ritchie, 2006) was adopted as follows. Visitors are all types of travelers engaged in tourism and tourists are visitors who stay in the country visited for at least one night. The visitors operationally deﬁned by the study included same-day visitors and overnight tourists.

Energy Consumption and CO2 Contribution by International Travelers

211

More than 90% of visitors came to Taiwan through Chiang Kai Shek International Airport (CKS). The number of inbound and outbound visitors by their residency and destination of 2004 was based on the statistical data of the Tourism Bureau of Taiwan (2004a, 2004c). To simplify the calculation, the mileage between the capital of the inbound visitors’ residencies or outbound visitors’ destinations and CKS airport was used. The mileage estimations of China Airline, Far Eastern Airline, and Northwest Airline were adopted. The mileage of each nation was converted into energy use per passenger by multiplying with energy intensity (energy use per passenger kilometer) of a long-distant ﬂight. Then, the energy consumption was converted into CO2 contribution per visitor. After multiplying the total inbound visitors and outbound visitors of each country with energy use per passenger respectively, it resulted in the total inbound visitors’ and outbound visitors’ energy use by countries. The formulas are as following: Energy use by countries (PJ1) ¼ total number of inbound visitors arrivals (or total number of outbound visitors’ departure) one-way trip distance (km) a (MJ/km)*10E-10 CO2 contribution per country (kiloton) ¼ energy use by countries b (g/MJ)*10E-10 where a ¼ conversion factor of a long length ﬂight (2 MJ/km is adopted). b ¼ conversion factor of CO2 contribution (69 g/MJ is adopted). Many researchers revealed different conversion factors about a based on different resources. It ranged from 1.75 MJ/km to 2.03 MJ/km. Lenzen (1999) reported 1.75 megajoules (MJ)/km for a long-distant ﬂight (as cited in Becken, 2002); Go¨ssling, Hansson, Ho¨rstmeier, and Saggel (2002) applied to 2.0 MJ/km based on a range of resources; British Airways and Lufthansa suggested overall energy intensities of 2.03 and 1.86 MJ/km per passenger kilometer, respectively (Green Globe, 2000, as cited in Becken, 2002). In this study, 2.0 MJ/km was adopted for a and a factor of 69 g/MJ of kerosene was applied for b (Baines, 1993, as cited in Becken, 2002). Table 1 shows the number of arrivals of inbound visitors, average ﬂight distance, energy use, and CO2 contribution of Taiwan in 2004. It indicates that the largest contributors of CO2 came from Japan and the United States. Japan had the largest amount of inbound visitors to Taiwan, and the United States had the longest distance between Taiwan. The similar process was applied to outbound visitors of Taiwan by their destination. The number of departures of outbound visitors, average ﬂight

Countries

a

Arrivals

% of Arrivals

One-Way Distance (km)

Energy Use per Visitor (MJ)

CO2 per Visitor (ton)

Energy per Country (PJ)

CO2 per Country (kiloton)

887,311 417,087

30.1 14.1

2,140.44 893.19

4,280.87 1,786.38

0.30 0.12

3.80 0.75

262.09 51.41

382,822 148,095 116,885 103,089 92,760 87,005 50,518 44,161 41,981 37,146 37,242 21,354 16,305 12,654 10,343 11,225 7,716 424,643 2,950,342

13.0 5.0 4.0 3.5 3.1 2.9 1.7 1.5 1.4 1.3 1.3 0.7 0.6 0.4 0.4 0.4 0.3 14.4 100.0

12,533.62 1,466.12 3,231.57 2,502.54 3,247.67 1,176.43 9,586.90 3,820.60 6,754.44 9,717.26 9,974.75 9,804.16 4,387.09 8,159.40 10,092.23 10,095.45 9,224.79 7,038.00a

25,067.24 2,932.24 6,463.15 5,005.08 6,495.34 2,352.87 19,173.80 7,641.19 13,508.88 19,434.51 19,949.50 19,608.32 8,774.18 16,318.81 20,184.47 20,190.91 18,449.59 14,076.00

1.73 0.20 0.45 0.35 0.45 0.16 1.32 0.53 0.93 1.34 1.38 1.35 0.61 1.13 1.39 1.39 1.27 0.97

9.60 0.43 0.76 0.52 0.60 0.20 0.97 0.34 0.57 0.72 0.74 0.42 0.14 0.21 0.21 0.23 0.14 5.98 27.31

662.14 29.96 52.13 35.60 41.57 14.13 66.83 23.28 39.13 49.81 51.26 28.89 9.87 14.25 14.40 15.64 9.82 412.43 1,884.67

To be conservative, the distance of inbound visitors from other countries is adopted, i.e. the average distance between the capital of the rest of the countries and CKS airport.

LI-JU CHEN AND JOSEPH S. CHEN

Japan Hong Kong, Macao USA Korea Singapore Thailand Malaysia Philippines Canada Indonesia Australia UK Germany France India Middle East Italy Netherlands New Zealand Others Total

Arrival of Inbound Visitors, Average Flight Distance, Energy Use and CO2 Contribution Based on Visitors’ Residency.

212

Table 1.

Energy Consumption and CO2 Contribution by International Travelers

213

distance, energy use, and CO2 contribution of Taiwan by their destinations in 2004 is shown in Table 2. The number of outbound visitors of Taiwan was over twice the number of inbound visitors of Taiwan in 2004. The total energy use of international visitors of Taiwan for one-way trip is 74.44 PJ (27.31+47.13). The total CO2 contribution of international visitors for one-way trip is 5136.54 kilotons (1884.67+3251.87). Table 3 shows the CO2 emission of Taiwan by sectors in 2004. The transportation is about 14% of total CO2 emission. Taking the total CO2 contribution of international visitors (one-way trip) into consideration, it is about 14% of the emission of CO2 in transportation in 2004 (5136.54/35520).

DISCUSSIONS The result shows that distance is the key point for energy use and CO2 contribution by international tourists. It seems to suggest that the government should promote more domestic tours or cooperate with near-by countries for short-distant international trips to decrease the energy use of outbound visitors in long-distant ﬂights. Furthermore, different transportation modes could be introduced to substitute air travel, for example cruises. It is worth noting that the number of nights visitors stayed may affect the results, although the study did not analyze it. If the length of stay is taken into consideration, the average of energy use per visitor per country will change. As a host country, the longer the visitors stay, the smaller the average energy they spend per day. Therefore, promoting long-haul vacation to inbound visitors could help reduce the energy use or CO2 contribution. The study ﬁndings could be compared with other sustainable development indexes such as ecological footprints (EFs). EF is a method to assess the environmental impact caused by human activities. It depicts the amount of nature resources supporting a human being within the hypothetical unit of land (Hunter & Shaw, 2007). Thus, for future research the study suggests applying the concept of EF. In summary, global warming is a serious issue on the nature environment and affects the growth of all industry as well as the prosperity of all countries. Unfortunately, the problem caused by international travels has not been well articulated until this decade (Wheatcroft, 1991; Copeland, 1992; Olsthoorn, 2001; Schafer & Victor, 1999; Somerville, 2004). One reason is the complexity of the political rule such as allocation of the CO2

Countries

Departures

% of Departure

One-Way Distance (km)

Energy Use per Visitor (MJ)

CO2 per Visitor (ton)

Energy per Country (PJ)

CO2 per Country (kiloton)

2,559,705 1,051,954 1,038,006 536,217 422,189 298,325 266,115 283,757 160,088 180,883 128,162 112,552 112,413 75,957 41,909 34,071 26,423 25,160 24,484 22,045 21,047 359,190 7,780,652

32.90 13.52 13.34 6.89 5.4 3.83 3.42 3.65 2.06 2.32 1.65 1.45 1.44 0.98 0.54 0.44 0.34 0.32 0.31 0.28 0.27 4.62 100.00

820.77 2140.44 965.61 12533.62 2502.54 1466.12 4406.40 3820.60 3231.57 3247.67 10095.45 1176.43 9586.90 6754.44 2409.20 9717.26 9804.16 9974.75 10092.23 7242.08 9224.79 5772.00a

1,641.54 4,280.87 1,931.22 25,067.24 5,005.08 2,932.24 8,812.80 7,641.19 6,463.15 6,495.34 20,190.91 2,352.87 19,173.80 13,508.88 4,818.39 19,434.51 19,608.32 19,949.50 20,184.47 14,484.15 18,449.59 11,544.00

0.11 0.30 0.13 1.73 0.35 0.20 0.61 0.53 0.45 0.45 1.39 0.16 1.32 0.93 0.33 1.34 1.35 1.38 1.39 1.00 1.27 0.80

4.20 4.50 2.00 13.44 2.11 0.87 2.35 2.17 1.03 1.17 2.59 0.26 2.16 1.03 0.20 0.66 0.52 0.50 0.49 0.32 0.39 4.15 47.13

289.93 310.73 138.32 927.46 145.80 60.36 161.82 149.61 71.39 81.07 178.55 18.27 148.72 70.80 13.93 45.69 35.75 34.63 34.10 22.03 26.79 286.11 3,251.87

a To be conservative, the distance of outbound visitors of Taiwan is the average distance between the capital of 1–21 countries and CKS airport.

LI-JU CHEN AND JOSEPH S. CHEN

Hong Kong Japan Macao USA Thailand Korea Vietnam Indonesia Singapore Malaysia Netherlands Philippines Canada Australia Palau UK France Germany Italy Austria New Zealand Others Total

Departures of Outbound Visitors, Average Flight Distance, Energy Use and CO2 Contribution Based on Visitors’ Destinations.

214

Table 2.

Energy Consumption and CO2 Contribution by International Travelers

Table 3.

215

The CO2 Emission of Taiwan by Sectors in 2004.

Sector

CO2 Emission (kiloton)

%

150,251 54,159 35,520 2,031 5,183 3,233 4,159 254,536

59.03 21.28 13.95 0.80 2.04 1.27 1.63 100.00

Energy industry Industry Transportation Commercial Residential Agriculture, forestry and ﬁshery Others Total Note: Data from EPA, R.O.C. (2005).

contribution (Becken, 2002). For example, are the CO2 contributions based on users per country or on the airlines by the origin? The CO2 contribution of the international ﬂight was excluded from the national total (IPCC, 1996, as cited in Becken, 2002) because there is no consensus of the allocation methods. However, taking international visitors into consideration, the CO2 contribution will increase 14% in the transportation sector (see Table 3). In the years to come, it is necessary that the Tourism Bureau of Taiwan should take precautionary measures to adjust their strategies on international travel to reduce CO2 contributions.

NOTES 1. One megajoule (MJ) equals 106 joules; 1 petajoule (PJ) equals 1015 joule or 109 megajoules.

REFERENCES Becken, S. (2002). Analysing international tourist ﬂows to estimate energy use associated with air travel. Journal of Sustainable Tourism, 10(2), 114–131. Cohen, E. (1978). The impact of tourism on the physical environment. Annals of Tourism Research, April/June, 215–237. Copeland, E. (1992). The role of airlines in the tourism and environment debate. Tourism Management, 13(1), 112–114. Environmental Protection Administration, Executive Yuan, R. O. C. (2005). Establishment and update of National Greenhouse Gas emissions inventory (EPA-94-Fa11-03-A167). Unpublished. Goeldner, C. R., & Ritchie, B. (2006). Tourism: Principles, practices, philosophies (10th ed.). New York: Wiley. Go¨ssling, S., Hansson, C. B., Ho¨rstmeier, O., & Saggel, S. (2002). Ecological footprint analysis as a tool to assess tourism sustainability. Economical Economics, 43, 199–211.

216

LI-JU CHEN AND JOSEPH S. CHEN

Hammitt, W. E., & Cole, D. N. (1998). Wildland recreation (2nd ed.). Canada: Wiley. Houghton, J. T. (2004). Global warming: The complete briefing (3rd ed.). Cambridge: Cambridge University Press. Hfyer, K. G. (2000). Sustainable tourism or sustainable mobility? The Norwegian case. Journal of Sustainable Tourism, 8(2), 147–160. Hunter, C. (2002). Sustainable tourism and the touristic ecological footprint. Environmental, Development and Sustainability, 4, 7–20. Hunter, C., & Shaw, J. (2007). The ecological footprint as a key indicator of sustainable tourism. Tourism management, 28, 46–57. IPCC (Intergovernmental Panel on Climate Change). (1999). Aviation and the global atmosphere. A special report of IPCC working groups I and III. Cambridge: Cambridge University Press. Lenzen, M. (1999). Total requirements of energy and greenhouse gases for Australian transport. Transportation Research, Part D4, 265–290. Liddle, M. (1997). Recreation ecology: The ecological impact of outdoor recreation and ecotourism. London: Chapman & Hall. Noe, F. P., Hammitt, W. E., & Bixler, R. D. (1997). Park user perceptions of resource and use impacts under varied situation in three national parks. Journal of Environmental Management, 49, 323–336. Olsthoorn, X. (2001). Carbon dioxide emissions from international aviation: 1950–2050. Journal of Air Transport Management, 7, 87–93. Schafer, A., & Victor, D. G. (1999). Global passenger travel: Implications for carbon dioxide emissions. Energy, 24, 657–679. Somerville, H. (2004). Travel, tourism and the environmental challenges. Tourism and Hospitality Research, 5(1), 65–71. Tourism Bureau of Taiwan. (2004a). Ministry of Transportation and Communications, Republic of China, Taiwan. Yearly statistic data, Retrieved Feb. 22, 2006, from http:// 202.39.225.136/statistics/File/200412/table02_2004.pdf. Tourism Bureau of Taiwan. (2004b). Ministry of Transportation and Communications, Republic of China, Taiwan. Yearly statistic data, Retrieved Feb. 23, 2006, from http:// 202.39.225.136/statistics/File/200412/table12_2004.pdf. Tourism Bureau of Taiwan. (2004c). Ministry of Transportation and Communications, Republic of China, Taiwan. Yearly statistic data, Retrieved Feb. 23, 2006, from http:// 202.39.225.136/statistics/File/200412/table25_2004.pdf. Tourism Bureau of Taiwan. (2006). Ministry of Transportation and Communications, Republic of China, Taiwan. Yearly statistic data, Retrieved Feb. 22, 2006, from http:// 202.39.225.132/jsp/Eng/html/about_taiwan/nature.jsp. Wheatcroft, S. (1991). Airlines, tourism and the environment. Tourism Management, 12(2), 119–124. WTO (World Tourism Organization). (2006). International tourism up by 5.5% to 808 million arrivals in 2005. (2006, Jan. 24). Retrieved Feb. 5, 2006, from http://www.world-tourism.org/newsroom/Releases/2006/january/06_01_24.htm. WWF-UK. (2002). Holiday for footprinting: A practice tool for responsible tourism. Retrieved Feb. 27, 2006, from http://wwf.org.uk/researcher/issues/footprint/0000000261.asp.

GENDER-BASED SERVICE PREFERENCES OF SPA-GOERS Linda Sherman, Candice Clemenz and Steven Philipp ABSTRACT An emerging male market within the spa industry is causing practitioners to consider if men and women differ in their service preferences at spas. This study explored the question via a self-administered survey instrument distributed to individuals located in resort communities along the Gulf Coast of the Florida panhandle. Analysis of the responses of 107 subjects indicated significant gender differences on the importance ratings of 12 out of 18 common spa services: aromatherapy, body scrub and exfoliation, facial, fitness facilities, lymph drainage, manicure, mud or seaweed wrap, pedicure, Pilates, Shiatsu, sport massage, and yoga. The services that men and women rated similarly in decreasing order of importance were Swedish massage, nutritional counseling, steam and sauna, hydrotherapy, spa cuisine, and reflexology.

INTRODUCTION According to Health Fitness Dynamics, Inc. (2002) and the International Spa Association’s (2004) Spa Industry Study, men and women have unique interests and needs at spas. The current study was designed to further explore gender differences at spas, questioning if signiﬁcant differences exist Advances in Hospitality and Leisure, Volume 3, 217–229 Copyright r 2007 by Elsevier Ltd. All rights of reproduction in any form reserved ISSN: 1745-3542/doi:10.1016/S1745-3542(06)03013-X

217

218

LINDA SHERMAN ET AL.

between the services preferred by male and female spa-goers. This is important information for practitioners within the competitive and growing spa industry considering the trend of an emerging new male market. In the past 10 years, the spa industry has had tremendous growth. The number of spas in the United States has increased by an average of 20% annually over the past eight years (Locker, 2002). Results from a 2004 International Spa Association (ISPA) study indicated there were an estimated 12,000 spas in the United States; this is a 25% increase from 2002 (ISPA, 2004). Day spas still comprise the largest segment of the industry, but resort spas are by far the fastest growing spa sector. From 2000 to 2002, resort spas showed a cumulative increase of 143% in the number of locations (Locker, 2002). Regarding revenues, the spa industry in the United States more than doubled from 1999 to reach 10.7 billion dollars in 2001 (Locker, 2002). In 2003 spa revenues were 11.1 billion dollars (ISPA, 2004). More than half of the industry’s revenues were derived from spa treatments (Locker, 2002), and according to the 2004 ISPA survey, treatment revenues continued to surpass amusement/theme parks and box ofﬁce gross receipts, to make the spa industry the fourth largest leisure industry in the United States. According to Nancy Grifﬁn (2002), ‘‘The driving force behind the growth is consumer demand’’ (p. 1). One out of ﬁve Americans said they visited some type of spa every 12 months; this means more than 44.9 million people, aged 16 and above, visited spas in the United States between June 2002 and June 2003 (ISPA, 2003). Day spas received 68% of these visits while resort spas received the second largest number of spa visits (Locker, 2002). Grifﬁn (2002) believes there is still tremendous opportunity for growth. Analyst expects the industry to skyrocket as the gap narrows between current spa usage and the public’s intention to use spas. This phenomenal growth has led to increasing competition as spa developers across the country open creative, expansive facilities, and existing spas expand their service menus (Yancey, 2003). Gone are the days of spas offering only massages and facials. Destination spas offer everything from anti-aging treatments to programs that tune-up their clients’ sex lives. The renown Canyon Ranch menu, for instance, is more than 50 pages and includes standard services such as massage, as well as innovative treatments like genetic testing (Yancey, 2003). Additionally, an unprecedented number of resort managers are either expanding their current spa facilities or deciding to add spas, in hopes of gaining an advantage over competitors. A study of 3,000 spa-goers indicated that 82% of women and 78% of male respondents would choose one resort

Gender-Based Service Preferences of Spa-Goers

219

over another due to an enhanced spa. But, resorts do not have unlimited resources. Therefore, their success depends upon offering the right combination of services, according to McNeil and Ragans (2005) who stress the need to make spa experiences relevant for consumers. Spa professionals who apply the basics of service management have a clear advantage as they seek to understand and serve the needs of the consumers within their target markets. Only 10 years ago, spas were primarily thought of as fat farms or pampering palaces for wealthy women. Today’s spa is evolving into a center for healing and nourishing the mind, body, and spirit. People go to spas for a variety of reasons other than appearance: ﬁtness, stress management, peace of mind, pampering, health, and wellness. For an increasing number of consumers, visiting a spa is no longer a luxury but a necessity. Prevention, healthy lifestyles, and relaxation motivate today’s spa-goer. The spa client of the future will be concerned with health and well-being as well as longevity (Locker, 2002). Additionally, spas no longer appeal to only the wealthy as they are more accessible to a broader population (Register, n.d.). A change that is fueling the growth of the spa industry is the ever-expanding segment of male spa-goers (McMurdy, 2002). According to a 2003 ISPA study, females still represent the majority of spa-goers at 70%. However, there was a rise in male clients from 20% in 1997, to 24% in 2002, to 29% in 2003 (Monteson, 1998). In 2001, Spa Finder reported that the number of calls from men to its spa-booking center increased 900% in 4 years. The average male spa-goer is between 35 and 54 years of age, married, and a college graduate who earns between $75,000 and $149,000 per year (Discover Spas, 2006). The 2003 Spa-Goer Study by ISPA indicated that although there are similarities between males and females in reference to spa visits, there are numerous differences. Ninety-three percent of males and females said they felt better after visiting a spa; however, females indicated that they felt more attractive and conﬁdent, whereas males reported feeling more energized, healthy, and robust. Although the number one reason that both men and women visit spas is to relieve stress and feel relaxed, females focus on indulging themselves while males are more likely to cite physical health as a reason for seeking spa services (ISPA, 2003). Males primarily visit spas after work and/or while on a business trip; females generally frequent spas during working hours (ISPA, 2003). Both males and females indicated their willingness to visit spas during the weekend and while on vacation. Women are more likely to visit a spa alone or with a friend; the majority of males visit spas with their signiﬁcant others (ISPA, 2003). Another important

220

LINDA SHERMAN ET AL.

difference noted by Misty Johanson (2004) is that male clients do not seem to value the spa experience as much as female clients since only 30% of men indicate a desire to return to a spa. Johanson suggests that perhaps spas are not currently offering a male-friendly experience. Patty Monteson and Judy Singer are co-owners of Health Fitness Dynamics, a spa consulting company in Pompano Beach, Florida that specializes in planning, marketing, and managing support services for spas. Both experts believe that the way to differentiate a spa is to know the market and the preferences of the market. According to Monteson (2003), ‘‘Who is visiting your spa is important when determining what to offer’’ (p. 3). Monteson and Singer (1992) believe that success depends upon understanding existing guests, anticipating the needs of future guests, and deﬁning a marketable spa concept. As consultants, they guide spa investors to understand what appeals to the consumers visiting the spa before beginning to plan the facility (Health Fitness Dynamics, Inc., 2002). Monteson and Singer also contend that females make-up the largest percentage of spagoers because spas in the United States continue to market primarily to women. They state, ‘‘Spas need to expand the existing market by becoming more male friendly in terms of facility features, de´cor, treatments, and marketing strategies’’ (Monteson & Singer, 2002, p. 4).

METHODS AND RESULTS The units of analysis for this study were individuals. The target population included both males and females, and the sampling frame consisted of persons located in the common areas at various shopping venues in the northwest Florida resort counties of Escambia, Santa Rosa, and Okaloosa. The locations at which this convenience sample was obtained included the Market Shops of Destin, Baytowne Wharf, and shopping centers in Perdido Key and Pensacola. The non-probability convenience sampling technique was justiﬁed due to the exploratory nature of the research (Zikmund, 1997). The survey instrument consisted of three pages and two sections. Because the word spa conjures various visions, the researchers began on page one by clarifying that a spa is a facility where one goes for a variety of treatments and reasons, whether to relax, rejuvenate, exercise, or get pampered – types include day spas, amenity or resort spas, destination spas, and medical spas. The ﬁrst section of the questionnaire featured a ﬁve point Likert scale (1 ¼ very unimportant and 5 ¼ very important) that required respondents to evaluate the importance of 18 spa services (16 treatments and 2 facility

Gender-Based Service Preferences of Spa-Goers

221

features). The services listed on the questionnaire were determined to be those most commonly found in full-service spas through an examination of spa service menus; the listing order was determined through the use of a random numbers chart. The second section comprised the last page of the survey instrument, and it included ﬁve questions that addressed personal information pertaining to the respondents; two questions regarding spa visitation were included. The following deﬁnitions were provided for individuals completing the survey:

Swedish massage Pedicures Spa cuisine

Yoga

Reﬂexology Facial

Mud or seaweed body wraps Nutrition counseling Pilates

Manicures

Massage technique employing the gentle but ﬁrm manipulation of pressure points and muscles Nail care and treatment of the feet Fresh, natural foods low in saturated fats and cholesterol, with an emphasis on whole grains, low-fat dairy products, lean proteins, fresh fruit, ﬁsh and vegetables and an avoidance of added salt, sodium, and artiﬁcial colorings, ﬂavorings, and preservatives Eastern discipline using various position/postures, controlled breathing and focused/centered concentration in combination with various slow physical movements; yoga is designed to improve circulation, ﬂexibility, and strength An ancient therapy focusing on reﬂexes in the feet that correspond to speciﬁc body organs Broad term it is a technique performed by a skin care specialist that focuses on the treatment of the skin as both therapy and healing for the skin Nutrient and mineral rich treatments that are known for their detoxiﬁcation properties The review of an individual’s eating habits and dietary needs by a qualiﬁed practitioner Invented by Joseph Pilates, this program was originated for athletes and ballet dancers; a conditioning program with corrective exercises to lengthen, tone, and stretch the body A cosmetic treatment of the ﬁngernails, including shaping and polishing

222

LINDA SHERMAN ET AL.

Continued Shiatsu Aromatherapy

Steam and sauna Body scrubs and exfoliation

Fitness facilities Hydrotherapy Lymph drainage

Sports massage

Japanese massage technique of acupressure used on pressure points to improve energy ﬂow Based on the ancient practice of utilizing essential oils to heal by therapeutically stimulating the nasal/ olfactory senses, mental responses, and circulatory respiratory functions Two forms of heat, one wet and one dry, stimulate sweating to eliminate toxins The process of removal and sloughing of dead skin cells. This process aids in improving circulation through stimulating blood ﬂow; pressure used to generate the process further aids in relaxation and stress reduction Separate facility for exercise which can consist of aerobic or anaerobic equipment Treatment utilizing fresh water as a primary facilitator Massage treatment of the lymphatic system, which stimulates circulation, reduces water retention, and frees up stored toxins Technique of using quick and vigorous strokes including deep tissue on localized body parts where a speciﬁc activity may have caused exertion and muscle tightness

The process of gathering information was facilitated through self-administration of the questionnaire previously described. The researcher received permission to randomly approach subjects in the public areas in and around shopping venues; she asked both men and women if they would be willing to complete a survey. One hundred and seven individuals agreed to respond to the survey; 16 people declined the opportunity to participate. The response rate was 87% and all 107 completed surveys were usable. The statistical program SPSS was used for data processing and statistical analysis related to this study (SPSS Inc., 1999). Percentages and frequency analysis of the demographic data proﬁled the respondents. Means were calculated for each of the 18 spa services, based upon group responses (men and women) to a Likert scale where 1 indicated the service was very unimportant at a spa and 5 indicated the service was very important. To determine if

Gender-Based Service Preferences of Spa-Goers

223

signiﬁcant differences existed between how women and men rated the importance of the various spa services, the non-parametric Mann–Whitney test was used to analyze the ordinal data. Mann–Whitney is appropriate for ‘‘comparing two sample means when the two populations are not normally distributed or when it cannot be assumed that the samples are from populations that are equal in variability’’ (Zikmund, 1997, p. 613). Crosstabulation was used to analyze responses to two spa visitation questions (1) ‘‘Have you ever visited a spa?’’ and, if yes, (2) ‘‘How many times have you visited a spa in the past 12 months?’’ based upon the grouping of subjects by gender, ethnic background, age, educational level, and marital status. The w2 test was used to determine if signiﬁcant differences existed in the frequency distribution of responses to the categorical demographic variables. Tables 1 and 2 proﬁle the 107 respondents based upon their responses to seven questions in the personal information section of the questionnaire. The majority of respondents were female (56%), and 87% were white. The greatest percentage of respondents, 31%, was in the 46–55 year old category, and 51% had undergraduate college degrees. Fifty-nine percent of those responding to the questionnaire were married. Sixty-six percent of the respondents had previously visited a spa, and of those with spa experience, the greatest percentage (45%) said they had been to a spa one to ﬁve times in the past 12 months. The mean ratings of how men and women evaluated the importance of 18 spa services are reported in Table 3. The top six services that men rated as ‘‘somewhat important’’ to ‘‘very important’’ are sport massage (4.58), Swedish massage (4.53), ﬁtness facilities (4.51), nutritional counseling (4.15), steam and sauna (4.15), and hydrotherapy (4.0). Women rated seven services as ‘‘somewhat important’’ to ‘‘very important’’: facial (4.61), manicure (4.56), Swedish massage (4.51), pedicure (4.46), body scrubs and exfoliation (4.31), nutritional counseling (4.10), and Pilates (4.03). The Mann–Whitney test was used to determine whether or not signiﬁcant differences existed in the way men and women rated each spa service. The results, also reported in Table 3, indicate that signiﬁcant differences exist at the 95% conﬁdence level in men’s and women’s ratings of 12 out of 18 services: aromatherapy, facial, ﬁtness facilities, lymph drainage, manicure, pedicure, Pilates, body scrub and exfoliation, Shiatsu, sport massage, mud or seaweed wrap, and yoga. Of the six services that men and women rated similarly (hydrotherapy, nutritional counseling, reﬂexology, steam and sauna, Swedish massage, and spa cuisine), Swedish massage was rated most important with scores of 4.53 (men) and 4.51 (women). Men averaged 4.15 for nutritional counseling and women rated it 4.10. Sauna and steam

224

LINDA SHERMAN ET AL.

Table 1. Subject Responses to Personal Information Questions (n ¼ 107). Personal Information

Frequency

Percentage of Respondents

Gender Female Male

60 47

56.1 43.9

Ethnic background Black Hispanic American Indian Asian Paciﬁc Islander White Other

8 2 1 2 93 1

7.5 1.9 0.9 1.9 86.9 0.9

Age Less than 16 years of age 16–20 years of age 21–25 years of age 26–35 years of age 36–45 years of age 46–55 years of age 56–65 years of age More than 65 years of age

0 0 3 18 21 33 21 10

00.0 00.0 2.8 16.8 19.6 30.8 19.6 9.3

Educational level Attended high school High school diploma Undergraduate college degree Graduate work Postgraduate work

4 24 54 20 4

3.8 22.6 50.9 18.9 3.8

Marital status Single Married

44 63

41.1 58.9

received a mean rating of 4.15 from men and 3.98 from women. Men rated hydrotherapy 4.0 while women rated it 3.84. Both men and women considered spa cuisine less than somewhat important since men rated it 3.55 and the mean of the women’s ratings for spa cuisine was 3.83. Reﬂexology received more ambivalent scores of 3.11 from men and 3.48 from women. Cross-tabulations were used to investigate the relationships between ﬁve personal information factors and the way respondents answered each of the following spa visitation questions: ‘‘Have You Ever Visited a Spa?’’ (Table 4), and, if so, ‘‘How Many Times Have You Visited a Spa in the Past

Gender-Based Service Preferences of Spa-Goers

225

Table 2. Subject Responses to Personal Information Questions (n ¼ 107). Characteristic

Frequency

Percentage of Respondents

Have you ever visited a spa? Yes No

71 36

66.4 33.6

If ‘‘yes’’ to previous question, how many times have you visited a spa in the past 12 months? (n ¼ 73) 0 visits in the past 12 months 1–5 visits 6–10 visits 11–15 visits More than 15 visits

30 33 5 2 3

41.1 45.2 6.8 2.7 4.1

Note: Percentages may not equal 100% due to rounding.

Table 3. Mean Importance Ratings of 18 Spa Services as Evaluated by Men and Women, with Signiﬁcant Differences Determined by Mann–Whitney Test (n ¼ 107). Spa Service Sports massage Swedish massage Fitness facilities Nutritional counseling Steam and sauna Hydrotherapy Facial Spa cuisine Manicure Shiatsu Body scrubs or exfoliation Aromatherapy Reﬂexology Pedicure Lymph drainage Yoga Mud or seaweed wrap Pilates

Mean (Men)

Mean (Women)

Asymp. Signiﬁcance

4.58 4.53 4.51 4.15 4.15 4.00 3.77 3.55 3.40 3.35 3.23 3.13 3.11 3.09 3.04 2.55 2.28 2.45

3.73 4.51 3.90 4.10 3.98 3.84 4.61 3.83 4.56 3.76 4.31 3.95 3.48 4.46 3.84 3.78 3.88 4.03

0.000 0.801 0.002 0.473 0.301 0.217 0.000 0.472 0.000 0.024 0.000 0.000 0.093 0.000 0.000 0.000 0.000 0.000

Note: 1 ¼ very unimportant and 5 ¼ very important. Signiﬁcant at a 95% conﬁdence level.

226

LINDA SHERMAN ET AL.

Table 4. Cross-Tabulation of Respondents’ Personal Information and Responses to ‘‘Have You Ever Visited a Spa Before?’’ with Results of w2 Test for Signiﬁcant Differences (n ¼ 107). Personal Information

‘‘Have You Ever Visited a Spa?’’ Frequencies Yes

No

Gender Female Male

46 (77.7) 25 (53.2)

14 (23.3) 22 (46.8)

Ethnic background White Non-white

63 (67.7) 8 (57.1)

30 (32.3) 6 (42.9)

20 (47.6)

22 (52.4)

26 (78.8) 18 (85.7) 7 (63.6)

7 (21.2) 3 (14.3) 4 (36.4)

15 (53.6) 34 (63.0)

13 (46.4) 20 (37.0)

21 (87.5)

3 (12.5)

23 (52.3) 48 (76.2)

21 (47.7) 15 (23.8)

Age Less than 36 years of age 36–45 years of age 46–55 years of age Over 55 years of age Educational level High school diploma Undergrad college degree Graduate degree or beyond Marital status Single Married

Asymp. Signiﬁcance 0.011

0.434

0.006

0.029

0.010

Note: Percentages may not equal 100% due to rounding. Only 106 responses were received to the question of educational level. Signiﬁcant at a 95% conﬁdence level. Numbers in parentheses are percentages of respondents within each demographic factor.

12 months?’’ (Table 5). The results of the w2 test are most useful when no cell has an expected value less than 1 and not more than 20% of the cells have expected values less than 5 (Howell, 1997; SPSS Inc., 1999). To meet this criterion, it was necessary to correct the original data by collapsing response categories for some survey items (Zikmund, 1997). The w2 tests of signiﬁcance showed that the following four factors were signiﬁcantly associated at the 95% conﬁdence level with whether or not a respondent had previously been to a spa: gender, age, educational level, and marital status (Table 4). Ethnicity was the only demographic characteristic

Gender-Based Service Preferences of Spa-Goers

227

Table 5. Cross-Tabulation of Respondents’ Personal Information and Responses to ‘‘If You Have Been to a Spa Before, How Many Times Have You Visited a Spa in the Past 12 Months?’’ and Results of w2 Test for Signiﬁcant Differences (n ¼ 73). Personal Information

‘‘How Many Times Have You Visited A Spa in the Past 12 Months?’’ Frequencies 0 Times

1+ Times

Gender Female Male

17 (35.4) 13 (52.0)

31 (64.6) 12 (48.0)

Ethnic background White Non-white

27 (41.5) 3 (37.5)

38 (58.5) 5 (62.5)

Age Less than 36 years of age 36–45 years of age 46–55 years of age Over 55 years of age

8 11 7 4

13 16 11 3

Educational level High school diploma Undergrad college degree Graduate degree or beyond

7 (46.7) 16 (45.7) 7 (31.8)

8 (53.3) 19 (54.3) 15 (68.2)

Marital status Single Married

14 (58.3) 16 (32.7)

10 (41.7) 33 (67.3)

Asymp. Signiﬁcance

0.172

0.827

0.835 (38.1) (40.7) (38.9) (57.1)

(61.9) (59.3) (61.1) (42.9) 0.530

0.036

Note: Percentages may not equal 100% due to rounding. Signiﬁcant at a 95% conﬁdence level. Numbers in parentheses are percentages of respondents within each demographic factor.

not found to be signiﬁcantly associated with previous spa experience. According to Table 4, marital status was the only factor signiﬁcantly associated at the 95% conﬁdence level with how frequently spa users visited a spa in the last 12 months. The cross-tabulation procedure previously discussed also revealed that the greatest percentage of subjects for each response per category who had previously been to a spa were female, white, 46–55 years of age, married, with graduate degrees. Additionally, the greatest percentage of subjects for each response per category with previous spa experience who had been to a spa one or more times in the past 12 months were female, non-white, less than 36 years of age, married, with graduate degrees.

228

LINDA SHERMAN ET AL.

DISCUSSIONS Regarding respondents’ personal information, 40% said that they had visited a spa within the last 12 months. Compared to ISPA research that noted one in ﬁve Americans visit some type of spa every 12 months, a discrepancy seems to exist. This may be attributed to (1) data being collected at different periods of time, (2) varying deﬁnitions of a spa, (3) differing countries of origin of respondents, and/or (3) the high availability of day and resort spas within the tourist communities where data for this study were collected. The results of this research indicate that men and women view the importance of spa services differently. Generally speaking, men valued services that addressed wellness and feeling good (e.g. massage, physical ﬁtness, and nutrition). Women, on the other hand, rated appearance-oriented salon services such as facials and manicures as being more important; women agreed with men on the importance of therapeutic massage. Men appeared willing to be active while at a spa (i.e. interest in ﬁtness facilities) whereas women were prone to select less rigorous activities (i.e. yoga, Pilates) and favored services such as body scrubs and pedicures that were performed for them. These ﬁndings are consistent with previously cited ISPA (2003) literature. The value of this research, however, is that it revealed gender differences relative to speciﬁc spa services. This is important data for traditionally female spas that want to be competitive by attracting their fair share of the emerging male market; spas must offer services and amenities that attract and retain male clientele. Several interesting ﬁndings were identiﬁed via the two cross-tabulation analyses. The proﬁle of the typical spa-goer in this research paralleled previous studies: well-educated, middle-aged, married, and female. Looking more closely at the educational levels of respondents, 88% of those with graduate degrees had previously visited a spa, and of that group, 68% had visited a spa one or more times in the past 12 months. Regarding ethnicity, 57% of non-white respondents had previous spa experience (11% less than white respondents), but 63% of non-white individuals with spa experience had been to a spa one or more times in the past 12 months; only 59% of white spa-goers had visited a spa in the past 12 months. Although individuals from diverse ethnic groups and persons with graduate degrees both represent small subsets within the total number of spa-goers in this study, it could be inferred that these would be beneﬁcial market segments for spas to target since interest is relatively high. The major limitation of this study is the technique used to acquire the sample. Although convenience samples are frequently used for exploratorylevel research, they negatively impact the ability to generalize the results

Gender-Based Service Preferences of Spa-Goers

229

(Zikmund, 1997). Nevertheless, the researchers are hopeful that this study will (1) inspire other researchers to pursue spa studies that expand upon this initial research and (2) send a helpful message to spa developers and operators to be aware that differences exist in how men and women rate the importance of various spa services. The success of spas in the future will depend in large part upon their abilities to offer services that are important to the changing spa-goer market.

REFERENCES Discover Spas with Julie Register. (2006). Spa studies in the news. Retrieved on Dcember 9, 2006, from http://www.discoverspas.com/news/newsevents114.shtml. Grifﬁn, N. (2002). The state of spa. Massage & Bodywork Magazine, (June/July), 1–5. Health Fitness Dynamics, Inc. (2002). So you want to have a spa. (May 20). Retrieved on November 17, 2003, from http://hfdspa.com/pr_sre_p02.html. Howell, D. C. (1997). Statistical methods for psychology. Belmont, CA: Wadsworth. International Spa Association (ISPA). (2003). ISPA 2003 spa-goer study. Retrieved on November 17, from http://spas.about.com/library/weekly/aa072503ispastudy.htm. International Spa Association (ISPA). (2004). ISPA 2004 spa industry study. Retrieved on November 11, from www.traveldailynews.com. Johanson, M. (2004). Health, wellness focus within resort hotels. FIU Hospitality Review, (Spring), 24–28. Locker, D. (2002). The ISPA 2002 spa industry study-executive summary. Retrieved on November 17, 2003, from http://spas.about.com/library/weekly/aa101902.htm. McMurdy, D. (2002). The American spa business has a healthy glow. The Financial Post, December 17. McNeil, K., & Ragans, E. (2005). Staying in the spa marketing game: Trends, challenges, strategies and techniques. Journal of Vacation Marketing, 11, 31–40. Monteson, P. (1998). Attracting the spa-goer market to your vacation-ownership resort. Vacation Industry, (January/February), 12–146. Monteson, P. (2003). Spas fast becoming a must-have amenity. Hotel and Motel Management. Retrieved on November 14, from http://rdsweb2.rdsinc.com/texis/rds:suite/ =mce3TLRC. Monteson, P., & Singer, J. (1992). Turn your spa into a winner. Cornell Hotel & Restaurant Administration Quarterly, 33, 37–44. Monteson, P., & Singer, J. (2002). Planning and operating a resort based spa. Journal of Leisure Property, 2, 358–368. Register, J. (n.d.). Spa evolution, a brief history of spas. Retrieved on November 17, 2003, from http://spas.about.com/library/weekly/aa101902.htm. SPSS Inc. (1999). SPSS base 10.0 applications guide. Chicago, IL: SPSS Inc. Yancey. K. B. (2003). Looking for a spa? We’ll show you the way. USA Today, November 21, p. D11. Zikmund, W. G. (1997). Business research methods. Orlando: The Dryden Press.

THE HOTEL SERVICESCAPE FOR CHINESE FEMALE TRAVELLERS Li-Jen Jessica Hwang ABSTRACT With the move towards a consumer-orientated approach in the hospitality market, this article investigates the impact of the servicescape on female’s hotel experiences and examines the helpfulness of the hotel grading to their female customers. The findings suggest that the hotel’s products arguably did not adequately meet female travellers’ expectations, especially for businesswomen, and that the hotel grading offers scant information about the quality of hotel service and facilities catering for female customers. The industry needs to address its currently male-oriented service products to meet the needs of women travellers, particularly as they are anticipated to be the fastest growing segment of the travel market for the next century.

INTRODUCTION Is the female half of the population being successfully catered for by the hospitality industry? Answers to that question can be traced to the very heart of society’s social practices. External environments are for the most part designed and occupied by men where streets, bars and business parks, reﬂect western social structures of power and value and impacts on the professional ideologies of art, architecture, urban design and planning; while Advances in Hospitality and Leisure, Volume 3, 231–241 Copyright r 2007 by Elsevier Ltd. All rights of reproduction in any form reserved ISSN: 1745-3542/doi:10.1016/S1745-3542(06)03014-1

231

232

LI-JEN JESSICA HWANG

domestic areas ostensibly for women are assigned to enclosed spaces of consumption such as the house, the department store, the shopping centres or even the day time television screen (Miles, 1997). It may simply be because men and women are looking for different things in their environments; for men something that provides intense and unpredictable social interaction, connectedness to the street and its activity, and urban stimuli; while for women it is something that offers a relief from environmental stress, and view downtown plazas and parks as places that should be removed but not isolated from the dominant urbaneness of downtown (Whyte, 1980). Women do not seem to constitute a discrete market segment for hoteliers; rather, marketing practices accepted women as part of the family market segment and gain access to the hotel in their role as wives and mothers (Mazurkiewicz, 1983). It can be argued that women were generally restricted in access, not only to public life but to all aspects of public association outside the home (Aitchison, 2000), as a result of being excluded from male spheres of power and control. This exclusion was encouraged by social constructions of femininity and the ideologies of respect, serving to inﬂuence women and men’s notions of the suitability of female access to space. However, the evolution of the family continues to expand women’s role in the decision making (Hall, Swain, & Kinnaird, 2003) with the ﬁrst examples emerging in a study that found that the husband primarily controlled decisions relating to travel routes but that decisions about accommodation were shared by both husband and wife (Myers & Moncrief, 1978). Despite some isolated moves to appeal to the female business market, the hospitality industry in general needs to address its currently male-oriented service attitudes and facility provision if it is to more electively cater for businesswomen. The argument that gender-neutral marketing is framed by the dominant male perspective revealed women’s concerns over the inadequacy of levels of comfort and safety and of sexist staff attitudes. Some progress has been made, with some airlines considering themselves moved away from an essentially masculine product towards a policy of and gender neutrality, with airline product and services they regard as suitable for all business travellers (Westwood, Pritchard, & Morgan, 2000). The notion of re-visioning (Rothschild, 1999, p. 1) or deconstructing the patriarchal concept of the city has promoted an exploration of how the environment can be perceived through the eyes of women. Accordingly, what is important to note is that the factors of social barriers, the different consumption patterns of female customers and the demands of female customer being interpreted in terms of stereotypes, taken together contribute to female subordination in purely feminine packages.

The Hotel Servicescape for Chinese Female Travellers

233

Hotel grading schemes may provide part of the answer by assisting with the selection process of which hotel can provide the product and quality to meet, in particular, the needs of woman travellers. Ideally, higher star ratings can be viewed as better products and better quality hotels, which can anticipate and respond to their customer’s needs and requests regardless of their gender. As consumers may beneﬁt through clearer indication of the service likely to be offered, their service expectations are more likely to correspond with hotel’s performance so that their satisfaction with the destination is increased, giving the hotel some competitive advantage (Kozak & Rimmington, 1998). Therefore, this study aims to investigate whether the perceived hotel servicescape, as indicated through three physical environmental dimensions: ambient conditions, space/function and signs symbols and artefacts (Bitner, 1992), can meet both business and leisure woman travellers’ expectations and perceptions.

METHOD Applying a quantitative approach, a structured and self-administered questionnaire is utilised to inquire about participants perceptions of the hotel’s servicescape as represented by ambient conditions (temperature, air quality, noise, music, and odour), space/function (layout, equipment, and furnishing) and signs, symbols and artefacts (signage, personal artefacts, style of de´cor) on both what they have perceived and what they expected from the hotel provider. Each statement is measured using a ﬁve-point Likert scale (one being strongly agree and ﬁve being strongly disagree) to recall the perceived value judgment of a previous hotel visit. Additional questions asked for the purpose of the respondents’ hotel visit (either for leisure or business), and the grades of the hotel they stayed at (either upscale, deﬁned as four or ﬁve star, middle-scale or three stars, or economy, with two stars or less) along with their personal proﬁle such as age, education and income. In order to capture a representative woman traveller population, the samples were drawn from an emerging market, China, with the cooperation of the China International Travel Service (CITS) agency. Even with the setbacks associated with world terrorist activities and the outbreak of SARS, Chinese tourism is booming. According to World Tourism Organisation (WTO) statistics published in January 2005, the Asia and Paciﬁc region had an increase of 50 percent (34 million) in 2004 and China’s tourism growth has accounted for almost half of the increase in the entire region

234

LI-JEN JESSICA HWANG

(Klancnik & Peressolova, 2005). CITS is an afﬁliated member of the WTO business council, providing service to a total of 2,509,936 travellers both domestic and overseas in 2002 (Source: CITS, 2005), as such it is recognised to be part of the top rank in the Chinese tourist industry and an excellent source for a representative sample. Before the 300 targeted samples in the main study were collected, a pilot study with 10 female staff in CITS was carried out to test the questionnaire and data administration procedures. A total of 289 valid questionnaires were collected and subsequently analysed with Statistical Package for Social Scientists (SPSS v.13). As seen in Table 1, the respondent’s proﬁle distribution appears to ﬁt the classic bell shape of a normal distribution. Half of the respondents were travelling for business purposes and the other half for leisure. Most respondents were aged between 19–34, with an undergraduate degree, having an income of between $2,501–4,000 per month, and likely to stay in a mid-scale hotel. The Cronbach alpha coefﬁcient test found that respondents’ perceptions had high internal consistency (over 0.7 recommended levels, Sekaran, 2003) on

Table 1.

Demographic Proﬁles.

Characteristics

Frequency

Percentage

Age

18 19–34 35–54 55+

33 107 102 47

11.4 37.0 35.3 16.3

Education level

Under high school High school Undergraduate Postgraduate Above postgraduate

14 58 123 83 11

4.8 20.1 42.6 28.7 3.8

Income ($ per month)

Under 1,000 1,000–2,500 2,501–4,000 4,001–6,000 Above 6,000

30 45 107 86 21

10.4 15.6 37.0 29.8 7.3

Hotel grading

Upscale Mid-scale Economy

90 134 65

31.1 46.4 22.5

Purpose of visit

Leisure Business

141 148

48.8 51.2

The Hotel Servicescape for Chinese Female Travellers

235

the three dimensions of the hotels’ servicescape, 0.877 for the ambient conditions; 0.834 for the space/function; 0.950 for the signs/symbols/artefacts.

FINDINGS AND DISCUSSIONS High Expectations Towards the Hotel Sevicescape Using the paired-samples T-test, the results show statistical signiﬁcant differences between respondents’ expectations and their perceptions (Fig. 1). The female travellers in this study had high expectations with regard to the hotel’s ambient conditions, space/function arrangements and to a lesser degree the signs, symbols and artefacts, which were in no way close to being met. The expectations were almost uniformly two points higher than their perceptions on every statement in ambient conditions and space/function, with the gap for signs, symbols, and artefacts approximately 1.5 points. This is a huge difference, which clearly indicates that most of the elements of a hotel’s servicescape visited by the respondents (layout, equipment, furnishings, security systems, room facilities and toilet facilities), are in need of a great deal of attention in order to serve the needs of female travellers. How has this gap occurred? Woman travellers may have new attitudes, although the physical differences between the genders can be an obvious tool for developing gender-based products and services for hotels. The change in social expectations of marriage and the production of children has offered women more opportunities to gain higher education and earn a more equitable income. Female customers are dissatisﬁed with being secondary guests and expect not only to be treated with the same standards of courtesy and service that men receive but also demand much more than their male counterparts and are more sensitive to the hotels’ offerings. To aid a woman’s comfort and convenience, female-speciﬁc amenities such as a hairdryer, make-up remover, sufﬁcient and branded bath and toiletries products, full-length mirrors, lighted make-up mirrors, space for cosmetics and for hanging washables to dry, skirt hangers, smaller bathrobes and slippers all can make a difference to the perception of the product. Safety in the room can be encompassed by facilities (such as security chains, double locks, and peepholes on the hotel room door), room allocation (not to locate woman on the ground ﬂoors or the end of long corridors or near the elevators for rapidly escape) or having female service providers to deliver room service. Moreover, security schemes in public areas designed for female travellers includes wider and clean corridors with enough lighting, 24-hour

236

LI-JEN JESSICA HWANG

Strongly Disagree 1

Strongly Agree 3

2

4

5

Ambient conditions Hotel lobby has a pleasant music background.*** The colour style in the room is appropriate.*** The hotel room has proper temperature.*** The hotel has a fresh odour.*** There is enough lighting in the parking area.***

4.848 2.855 4.822 2.803 4.848 2.8 4.851 2.817 4.782 2.817

Space/Function The hotel layout is covenient for women customers.***

2.751

Hotel has modern looking equipment.***

2.754

The hotel furnishing sare visually appealing.***

4.83

4.813

4.709 2.73

There are comprehensive security systems in hotel.***

2.654

There are enough facilities in the room, especially for women.***

2.661

There are enough facilities in the toilet, especially for women.** *

2.678

4.84

4.841

4.734

Signs, Symbols and Artifacts 4.471

The style of décor is aesthetic.***

2.983 4.426

The room is clean.***

3.118

The uniforms match the hotel style.***

4.439 3.18

Expectations

Perceptions

Fig. 1. Female Travellers’ Expectations vs. their Perceptions towards a Hotel’s Servicescape. Note: Results of the Paired Sample T-test ***, po0.001 (at Two Tailed); Measured in a Five-Point Likert Scale.

doorman services, 24-hour surveillance cameras, clear layout navigation, valet parking or key cards without printed room numbers. The purpose focused hotel servicescape can create an experience of memorable services and therefore increase the progression of economic value

The Hotel Servicescape for Chinese Female Travellers

237

(Pine & Gilmore, 1998). Aside from the traditional hotel product, additional support services can be customised more for woman customers’ stay with female friends by offering options such as cooking classes, spa treatments, theatre or movie tickets, yoga classes or shopping.

High Expectations with Business Woman Traveller than Leisure Traveller Using the independent T-test, the results found that when respondents were travelling on business, their perceptions towards all three dimensions of hotel’s servicescape were much lower than the ones travelling for a leisure purpose (Fig. 2). The ﬁndings have conﬁrmed previous literature that stresses that businesswomen travelling alone are more conscious of special attention and protection. Milioti (2000) found businesswomen travelling alone are twice as likely as men to order room service as it appears to be more culturally acceptable for a man to dine alone than for a woman. Controversially, the myth of female travellers desiring constant special treatment can be viewed as a patronising attitude to the businesswoman, who prefers to be treated as a businessperson. Business travellers are looking for the distinctive products and services to support their business needs such as computers with an internet connection, fax machines, complimentary Strongly Disagree 1 Ambient Conditions ***

Space/function ***

Sign, Symbols and Artifacts ***

Strongly Agree 3

2

5

3.379 2.284

3.271 2.166

3.617 2.595

Leisure

Fig. 2.

4

Business

Female Traveller’s Perceptions by Purpose of Stay. Note: ***, po0.001 (at Two Tailed); Measured in a Five-Point Likert Scale.

238

LI-JEN JESSICA HWANG

newspapers, business traveller programmes or business meeting venues. Having a good night’s sleep and responsive service such as express check in/ out to be ready for the business meeting on time may be more critical for women who travel on business. Hotel Grading as an Imprecise Indicator for Woman Travellers With the one way ANOVA test, the results revealed that respondents staying in the three different hotel gradings show signiﬁcantly different perceptions towards the hotel’s ambient condition (F ¼ 3.514, po0.05). The post hoc test (Tukey HSD) found the perceptions towards the upscale hotel were higher than the mid-scale hotels, which were actually lower than economy hotels. No statistically signiﬁcant perceptions were found with the other dimensions (space/function, signs, symbols and artefacts); this indicates that the hotel grading has provided little indication of the perceptions of woman travellers (Fig. 3). These ﬁndings run counter to the ideology of using the grading of the hotel to indicate the quality of the stay from the woman’s perspective even though they have been designed to offer a clear indication on the quality of hotel products and services. Strongly Agree

Strongly Disagree 1

2

4

5

2.98 2.697 2.843

Ambient Conditions *

2.787 2.629 2.746

Space/Function

3.156 3.065 3.067

Signs, Symbols and Artifacts

Upscale

Fig. 3.

3

Mid-scale

Economy

Female Traveller’s Perceptions by Hotel Grading. Note: *, po0.05; Measured in a Five-Point Likert Scale.

The Hotel Servicescape for Chinese Female Travellers

239

The hotel grading schemes that exist around the world do not have consistent criteria and which are understood by the customers. Callan (1994) closely examined existing UK compulsory schemes for hotel grading and suggested reasons for statutory registration while commenting on the lack of progress in the UK and the degree to which price and tariff controls are in operation as compared with schemes in the European community. The English Tourism Council (ETC) uses two grading schemes: a star system for hotels and a diamond scheme for bed and breakfasts, guest houses, farmhouses and inns; Visit Scotland and the Wales Tourist Board have a one- to ﬁve-star system for all accommodation. As the result, ‘‘It is still confusing at the moment for people, but it is within everyone’s interests to have a uniﬁed set of symbols,’’ said a spokesman for the ETC (Mutch, 2003, p. 6). Currently, a joint initiative between the AA, RAC, VisitBritiain and VisitScotland and the Wales Tourist Board will introduce a single method of assessing and rating serviced accommodation soon for use across Britain replacing the schemes previously operated by each individual body. Another example of a unify hotel grading scheme, named ‘Leading Hotels of the World’, aims to simplify the existing ratings, reduce consumer confusion and allow tourism and travel bodies to promote hotels more effectively. These kinds of initiatives will become more important as they are adopted around the world, particularly in emerging markets such as China, allowing customers to more closely match their expectations to their experiences. Before drawing any general conclusions, it is to be reminded that some limitations have constrained this study. The selection and size of the samples were solely from within one travel agency, which claims to be the most popular and biggest travel company in China. While there is no framework to capture the views from the entire female travellers’ population, this study has used methods to ensure its validity and reliability in capturing the perceptions of the hotel servicescape from female travellers in an important emerging market that can be applied elsewhere.

CONCLUSION From the results of this study, hoteliers appear less than successful in having their servicescape meet the expectations of the female travellers’ market segment. Three signiﬁcant outcomes have been identiﬁed: women have much higher expectations of the hotel servicescape than their perceptions of the experience; the even greater gap between expectations and perceptions for businesswomen, which may reﬂect their twofold needs in meeting their

240

LI-JEN JESSICA HWANG

speciﬁc needs with regard to security and services while at the same time ﬁghting stereotypes to be treated as equal as men; ﬁnally the unsuitability of the hotel grading system as a tool to indicate whether the hotel meets the needs of the woman traveller market. Perhaps knowledge of the status of women in society can lead to an understanding of what a woman needs and expects when travelling. The evolution of woman studies can develop a greater understanding of what we are, how we live and why we play the various roles in society. More research should be called for to examine what the hotel industry can do to provide for this particular market segment when they travel alone, with family or with partners. As a reﬂection of the dominant male perspective, which frames society and the business world, businesswoman have to ﬁght for their status, legitimacy, and speciﬁc needs. Hoteliers could do a great deal to improve their tangible provision for women business travellers, starting with the design and de´cor of hotel property. While men regarded these as oases; women found them uninviting, intimidating, and masculine spaces. The need for cleaner and better-equipped facilities can provide a sense of secured personal space and safety; with, for example, the use of lounges at night and support available on arrival. The most emotive issue of all was the attitudes of staff towards businesswomen to treat them not as inferior to men but to give equal and individual attention for all. By gaining a competitive market advantage, a standardised hotel grading can turn intangible aspects of the hotel service experience into a tangible indication of their service quality and levels of business performance. From these results it can be seen that the grading systems have not properly served their function with respect to woman travellers’ needs, which may not necessarily be considered as a part of criteria. Further research should investigate the applicability of the hotel grading to meet the needs of all customers and indicate their quality and performance on which they have been benchmarked, how it applies to the market segment they serve, and what criteria have been applied. Arguably, with the gender-blind approach to the business customer currently used, hoteliers have undermined the status of female travellers. As the hotel experience becomes increasingly homogenised, awareness and identiﬁcation of speciﬁc consumer wants and needs, the ability to recognise woman travellers’ needs in committing areas of security, comfort, convenience, and responsive service will be the key to success. Any hotelier who is failing to meet women’s needs is likely to miss this signiﬁcant and growing market. Strategic changes to improve the servicescape elements can be the ﬁrst step.

The Hotel Servicescape for Chinese Female Travellers

241

ACKNOWLEDGEMENT The author would like to thank the assistance of Miss Yuan Meng from the CITS travel agency in China.

REFERENCES Aitchison, C. (2000). Poststructural feminist theories of representing others: A response to the ‘crisis’ in leisure studies’ discourse. Leisure Studies, 19(3), 127–144. Bitner, M. (1992). Servicescape: The impact of physical surroundings on customers and employee. Journal of Marketing, 56(April), 57–71. Callan, R. J. (1994). Statutory hotel registration and grading: A review. International Journal of Contemporary Hospitality Management, 6(3), 11–18. CITS (2005). About CITS. Online, Retrieved from http://www.cits.cn/en/aboutcits.htm. Hall, D., Swain, M. B., & Kinnaird, V. (2003). Tourism and gender: An evolving agenda. Tourism Recreation Research, 28(2), 7–11. Klancnik, R., & Peressolova, A. (2005). Asian destinations on the rise in world tourism ranking. WTO news release from Madrid: WTO Press and Communications Section. Retrieved on July 4, 2006 from http://www.world-tourism.org/facts/wtb.html. Kozak, M., & Rimmington, M. (1998). Benchmarking: Destination attractiveness and small hospitality business performance. International Journal of Contemporary Hospitality Management, 10(5), 184–188. Mazurkiewicz, R. (1983). Gender and social consumption. The Service Industries Journal, 3(1), 49–62. Miles, M. (1997). Gender spaces: Design, gender and education for urban futures. European Academy of Design. Conference paper, Chelsea College of Art and Design, pp. 1–16. Milioti, S. (2000). What do woman want? Business Traveller, November, 27–32. Mutch, F. (2003). Hotel grading scheme review will be central to government plans. Caterer and Hotelkeeper, 192(4299), 6. Myers, P. B., & Moncrief, L. W. (1978). Differential leisure travel decision making between spouses. Annals of Tourism Research, 5(1), 157–165. Pine, J. B., II, & Gilmore, J. H. (1998). Welcome to the experience economy. Harvard Business Review, 76(4), 97–105. Rothschild, J. (1999). Design and feminism: Re-visioning spaces, places and everyday things. London: Routledge. Sekaran, U. (2003). Research method for business: A skill building approach (4th ed.). New York: Willey. Westwood, S., Pritchard, A., & Morgan, N. J. (2000). Gender-blind marketing: Businesswomen’s perceptions of airline services. Tourism Management, 21(4), 353–362. Whyte, W. H. (1980). The social life of small urban spaces. Washington, DC: Conservation Foundation.

SUBJECT INDEX International visitor 35–36, 205, 208–209, 213, 215 Intervention effect 55, 62 Involvement 87, 92–97, 131–132, 135

Attractions 3–4, 7, 10–11, 19–21, 23, 34–35, 115, 118, 123 Baby boomers 40–44, 46–47, 49–52

Kashmir 3–4, 7–12, 14

CO2 contribution 205–206, 208, 211–215 Collaboration 137, 151–163, 165, 167–169, 171 Collaboration intensity 151, 162–165, 167–168 Cultural tourism 34, 36

Local visitors 35–36 Lodging industry 195–199, 202–203 Long-term debt 195–196, 198–202 Moving average 55, 62–63, 65 Museum 19–27, 31–36, 51

Environmental impact 205–208, 213 New service development 129–132, 134, 136–137, 142 Norfolk Island 39–44, 47, 49–52

Female travelers 231, 235–240 Firm value 195, 197–198, 200, 202–203 Forecasting 55, 59–60, 62–66

Online reservation 174–175, 177, 179, 185, 187, 190–191

Generation 21, 36, 39–41, 43–44, 46–52, 131–132, 134–135, 140, 142–144, 146 Gender preferences 217, 220, 223–224, 226–228

Participation 14, 36, 91, 129, 132, 145–146 Perception 3–5, 7, 9–16, 106, 110–113, 139, 152, 155–158, 169, 173, 175, 190, 206, 233–239 Pre-war generation 39, 41–44, 46–49, 51 Process quality 173, 177–179, 181–182, 187, 190

Heritage 4, 19, 21–23, 34–36, 41–44 Hotel grading 231, 233–234, 238–240 Hotel performance 151, 164 HRIS adoption 72, 79–80, 83 HRIS implementation 72, 74, 78, 80–82 Human resource 69–71, 76, 78, 80, 82–83, 137

Responsiveness 173, 176–177, 179, 181, 184, 187–188, 190 Risk perception 5, 87, 92–94, 97–102 243

244 Safety 3–7, 9–12, 14–15, 232, 235, 240 Sales efﬁciency 173, 177, 189 SARS 87–94, 97–102, 208, 233 Servicescape 231, 233, 235–237, 239–240 Spa 217–229, 237 Stakeholder 129, 132, 135, 147

SUBJECT INDEX Terrorism 4–7, 14, 16 Theme parks 87, 92–100, 102, 206, 218 Transportation 7, 10, 12–14, 115–116, 122, 131, 205–208, 213, 215 Type of management 151, 153, 155, 157–169, 171 Websites 8, 164, 173–175, 177, 179, 184–185, 187–188, 190

Advances In Hospitality And Leisure

Advances in Hospitality and Leisure, Volume 1 (Advances in Hospitality and Leisure) (Advances in Hospitality and Leisure)

Advances in Hospitality and Leisure, Volume 5

Advances in Culture, Tourism and Hospitality Research, Volume 1 (Advances in Culture) (Advances in Culture, Tourism and Hospitality Research) (Advances in Culture, Tourism and Hospitality Research)

Entrepreneurship & Small Business Management in the Hospitality Industry, Volume 15 (Hospitality, Leisure and Tourism)

Empowerment: HR Strategies for Service Excellence: HR strategies for service excellence (Hospitality, Leisure and Tourism) (Hospitality, Leisure and Tourism)

Advances in Hospitality and Leisure, Volume 3 (Advances in Hospitality and Leisure)

Advances In Hospitality And Leisure

Advances in Hospitality and Leisure, Volume 1 (Advances in Hospitality and Leisure) (Advances in Hospitality and Leisure)

Advances in Hospitality and Leisure, Volume 5

Advances in Hospitality and Leisure. Volume 4 (Advances in Hospitality and Leisure)

Hospitality Retail Management (Hospitality, Leisure and Tourism)

Hospitality Retail Management (Hospitality, Leisure and Tourism)

Franchising Hospitality Services (Hospitality, Leisure and Tourism)

Understanding the Hospitality Consumer (Hospitality, Leisure and Tourism)

Financial Management for Hospitality Decision Makers (Hospitality, Leisure and Tourism)

Advances in Culture, Tourism and Hospitality Research, Volume 1 (Advances in Culture) (Advances in Culture, Tourism and Hospitality Research) (Advances in Culture, Tourism and Hospitality Research)

Advances in Culture, Tourism and Hospitality Research, Volume 1 (Advances in Culture) (Advances in Culture, Tourism and Hospitality Research) (Advances in Culture, Tourism and Hospitality Research)

Entrepreneurship & Small Business Management in the Hospitality Industry, Volume 15 (Hospitality, Leisure and Tourism)

Advances in Sport, Leisure and Ergonomics

Consumer Psychology of Tourism, Hospitality and Leisure, Volume 2 (Cabi)

Entrepreneurship in the Hospitality, Tourism and Leisure Industries

Empowerment: HR Strategies for Service Excellence: HR strategies for service excellence (Hospitality, Leisure and Tourism) (Hospitality, Leisure and Tourism)

Timeshare Management: The key issues for hospitality managers (Hospitality, Leisure and Tourism)

Hospitality Sales and Promotion (Professional Hospitality Guides)

Advances in Culture, Tourism and Hospitality Research, Vol.2

Advances in Culture, Tourism and Hospitality Research, Vol.2

Hospitality

Business Development in Licensed Retailing: A Unit Manager's Guide (Hospitality, Leisure and Tourism)

Histories of Leisure (Leisure, Consumption and Culture)

Histories of Leisure (Leisure, Consumption and Culture)

In Search of Hospitality

Advances in Agronomy, Volume 3

Advances in Computers, Volume 3

Advances in Pharmacology Volume 3

Advances in Pharmacology Volume 3

Advances in Immunology Volume 3

Advances in Hospitality and Leisure, Volume 3 (Advances in Hospitality and Leisure)

Advances In Hospitality And Leisure

Advances in Hospitality and Leisure, Volume 1 (Advances in Hospitality and Leisure) (Advances in Hospitality and Leisure)

Advances in Hospitality and Leisure, Volume 5

Advances in Hospitality and Leisure. Volume 4 (Advances in Hospitality and Leisure)

Hospitality Retail Management (Hospitality, Leisure and Tourism)

Hospitality Retail Management (Hospitality, Leisure and Tourism)

Franchising Hospitality Services (Hospitality, Leisure and Tourism)

Understanding the Hospitality Consumer (Hospitality, Leisure and Tourism)

Financial Management for Hospitality Decision Makers (Hospitality, Leisure and Tourism)

Advances in Culture, Tourism and Hospitality Research, Volume 1 (Advances in Culture) (Advances in Culture, Tourism and Hospitality Research) (Advances in Culture, Tourism and Hospitality Research)

Advances in Culture, Tourism and Hospitality Research, Volume 1 (Advances in Culture) (Advances in Culture, Tourism and Hospitality Research) (Advances in Culture, Tourism and Hospitality Research)

Entrepreneurship & Small Business Management in the Hospitality Industry, Volume 15 (Hospitality, Leisure and Tourism)

Advances in Sport, Leisure and Ergonomics

Consumer Psychology of Tourism, Hospitality and Leisure, Volume 2 (Cabi)

Entrepreneurship in the Hospitality, Tourism and Leisure Industries

Empowerment: HR Strategies for Service Excellence: HR strategies for service excellence (Hospitality, Leisure and Tourism) (Hospitality, Leisure and Tourism)

Timeshare Management: The key issues for hospitality managers (Hospitality, Leisure and Tourism)

Hospitality Sales and Promotion (Professional Hospitality Guides)

Advances in Culture, Tourism and Hospitality Research, Vol.2

Advances in Culture, Tourism and Hospitality Research, Vol.2

Hospitality

Business Development in Licensed Retailing: A Unit Manager's Guide (Hospitality, Leisure and Tourism)

Histories of Leisure (Leisure, Consumption and Culture)

Histories of Leisure (Leisure, Consumption and Culture)

In Search of Hospitality

Advances in Agronomy, Volume 3

Advances in Computers, Volume 3

Advances in Pharmacology Volume 3

Advances in Pharmacology Volume 3

Advances in Immunology Volume 3

Recommend Documents