Abstract
AbstractTourism is a major driver of economic growth and livelihood promotion in the Uttarakhand state of India. The contribution of tourism to the state gross domestic product (GDP) and employment generation is significant. The expansion of tourism inevitably brings about the development of the hotel industry. Hotels must create effective competitive strategies for survival and use a performance measurement system that meets the requirements of a changing environment. Several studies have been conducted to study the rich tourist potential of the state. However, no research studies are available regarding performance measurement practices adopted by hospitality managers in Uttarakhand for measuring the performance of their establishments. The present study examines existing performance measurement practices used by hotel managers that employ the balanced scorecard (BSC) − an innovative and comprehensive performance measurement framework for assessing the performance and progress of hotels in this mountainous state of India. The results indicate that in spite of using measures from different perspectives inherent to the original BSC, hospitality managers are not aware of the concept of BSC in a formal manner. The study reveals that hotels in Uttarakhand still focus on the use of financial measures as compared to non-financial measures for measuring performance. The study supports the link between hotel performance and BSC measures usage.
Highlights
The ability to measure performance can be seen as an important prerequisite for improvement and remains fundamental to organizational success
This study explores the extent to which the balanced performance measurement is understood and balanced scorecard (BSC) is utilized by hospitality managers within the hotel industry of Uttarakhand, and examines the usage of the four perspectives of BSC and their impact on hotel performance
In the case of financial measures, room occupancy, return on investment (ROI), total operating revenue and profit, net profit, revenue per available room (RevPAR), sales growth, room and food and beverage (F&B) sales, return on capital employed (ROCE), cost efficiency and profitability were the prime measures used by these hospitality managers
Summary
The ability to measure performance can be seen as an important prerequisite for improvement and remains fundamental to organizational success. In the current dynamic environment, it is becoming ever more challenging for hospitality organizations to actively manage and maintain their performance and competitive advantage (Neely, 1999). Hospitality is a rapidly expanding industry worldwide, and is expected to remain a leading contributor to the global economy by generating desired foreign exchange reserves and simultaneously creating employment (Bagri, Babu & Kukreti, 2010). Tourism is one of the fastest growing industries in India and its role in accelerating the economic development of the country is widely recognized. India is known worldwide for its unprecedented natural and man-made attractions since time immemorial. Culture, cast and creed, value, tradition, folklore, dances and music attract tourists from far and wide
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