Abstract
The motivation for this study is to assess the managerial performance in Taiwanese international tourist hotels based on the two-stage NDEA performance mechanism with ICA technique for enhancing the discriminatory power of performance evaluation model. The two-stage managerial performance structure is applied, incorporating the service production and service operation stages, as a reduced form to introduce the relatively complex business environment of modern enterprise. However, we have need to be considerable of dimensionality curse problem in NDEA performance model. A modified NDEA-based evaluation model, therefore, is proposed to integrate the network slacks-based measure (NSBM) with a dimensional reduction technique, the independent component analysis (ICA). The results indicate that the performance of the profit dimension significantly hampers operational performance, and that both regulators and managers must adjust their market orientation business strategy. Moreover, compared with the NSBM model, this modified ICA-NSBM performance model has a high discriminatory ability to measure the relative performance of the selected hotels.
Highlights
The service sector has been the core of Taiwan’s economy in the past decades, accounting for more than 60% of Gross Domestic Product (GDP) and 59% of labor force (NDC, 2016) in 2015
We enrich the literature by proposing a modified two-stage NDEA performance model with independent component analysis (ICA) technique to measure the managerial performance of Taiwanese international tourist hotels over the period 2009–2015
In the proposed ICA-network slacks-based measure (NSBM) model, we first adopted a NSBM model with two-stage framework, the managerial performance is composed of the performance of service production and service operation
Summary
The service sector has been the core of Taiwan’s economy in the past decades, accounting for more than 60% of Gross Domestic Product (GDP) and 59% of labor force (NDC, 2016) in 2015. In light of the trend, promoting the development of tourism industry may as well be a good strategy for an island nation like Taiwan as a good driver for continuous growth of national economic, increasing employment. The slogan: “Time for Taiwan” is used to call for real actions on international travelers These marketing strategies have deepened Taiwan’s brand-name impression, which has translated into 14.7 billion US Dollars of tourism revenue in 2013. The fact that tourists from other countries has peaked at the same time, has helped to close the gap
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