HOW TO APPROACH HOTEL PERFORMANCE MEASUREMENT? A CONCEPTUALIZATION OF KEY DETERMINANTS

Abstract

Purpose – Market changes put new challenges for the hotel business. Hotels require and rely on measuring business performance, wherein inadequate measurement may compromise hotel performance and thus competitiveness on the tourism market. Performance measurement is an important managerial activity and a crucial support in company management and business decision making. Unfortunately, recent findings on measuring hotel performance are insufficient and incomplete. Therefor, the purpose of this paper is to foster innovation in hotel performance measurement and fill the findings gap in conceptualization of hotel performance key determinants by proposing an innovative approach to the conceptualization of hotel performance measurement. Design – Introductory remarks in the research problem are followed by hotel performance literature review, further key determinants of hotel performance are elaborated and a conceptual approach for measuring hotel performance is proposed, the paper ends with managerial implications and concluding remarks. Methodology – The objective is achieved by (i) a review of the hotel performance literature, (ii) the amalgamation of relevant findings in hotel performance researches, and (iii) proposing a hotel performance measurement framework. Approach – Based on the review of the relevant literature in the field of research findings will be summarized, critically reviewed and with theoretical footing a new innovative conceptual approach for measuring hotel performance will be proposed. Findings – The conceptual framework of hotel performance measurement inculd internal, external and temporal components. By approaching measurement of hotel performance internal, external and temporal determinants should be considered. Hotel characteristics stand out in the literature as crucial determinant of internal environment that determine business performance. Tourists, concretely destination demand represent a crucial element of the external environment of the hotel business. Further, the temporal component refers to tourism seasonality. It is necessary to explore hotel performance per season: low, medium and high season, to the contrary, research performance in a single time point or the aggregate annual data may lead to incorrect conclusions. Originality of the research – The contribution of research is a new innovative approach of hotel performance measurement conceptualization. This paper provides understanding of hotel performance determinants and fills an identified gap in the hotel performance measurment literature. Research findings are an important contribution to future research of hotel performance.