Abstract
This research aims to provide empirical evidence on the causal relationships among the effects of dynamic capabilities and the dynamic performance measurement on high performance organizations (HPOs) and the competitive performance of hotel businesses in a world-class tourism destination of Thailand. The research using questionnaires to collect data from 115 hotel businesses located at a world class tourism destination in Thailand. The data were first analysed using descriptive statistics and then confirmatory factor analysis and structural equation modelling were conducted. The study results reveal that the causal relationship model fit the empirical data ( 2 = 74.39, p-value = 0.15, 2/df = 1.18, CFI = 0.99, GFI = 0.92, NFI = 0.96, RMSEA = 0.04, and SRMR = 0.03). In addition, the results also indicate that the dynamic capabilities have a direct positive effect on dynamic performance measurement. The study reflects that being a HPO not only has a direct positive effect on competitive performance but is also a complete mediator in transferring the effects of the dynamic capabilities and dynamic performance measurement to competitive performance. Under an increasingly dynamic environment, traditional performance measurement innovations that only consider measurement and management tend to lead to imperfections and lower benefits. Additionally, traditional performance measurements are static characteristics; therefore, it is essential to catch up with the dynamic environment. This research will provide empirical evidence of the causal relationship of how dynamic capabilities and dynamic performance measurement affect a HPO and competitive performance towards excellence under a dynamic environment.
Highlights
The World Tourism Organization (UNWTO) has ranked Thailand as one of the ten most popular tourist destinations on the globe )UNWTO, 2019)
The study points out that dynamic capabilities have a positive relationship with high performance organizations (HPOs) and with competitive performance for hotel businesses because dynamic capabilities are the firm’s abilities to create, reconfigure and transform its entire existing resources to respond to environmental transformation, inside and outside the firm; having dynamic capabilities can upgrade their performance towards achieving outstanding performances (Pattanasing, Aujirapongpan & Srimai, 2019)
The study indicated that dynamic capabilities have a positive relationship with dynamic performance measurement, which occurs because the measurement system plays an important role in organizing a firm to be more efficient and effective
Summary
The World Tourism Organization (UNWTO) has ranked Thailand as one of the ten most popular tourist destinations on the globe )UNWTO, 2019). The hotel business, the core business of the country’s tourism industry, has been continuously expanded and experienced crucial competition while attempting to maximize its number of customers. It is undeniable that quality of service is the heart of the hotel business since quality enhances customers’ satisfaction and loyalty. Service quality increases market share, provides satisfying returns to investors while reducing costs and the risk from price competition, and, above all, creates competitive capabilities (Lu, Berchoux, Marek, & Chen, 2015). Amid the current critically competitive environment, the survival of the hotel business, depends on the quality of the service provided to satisfy its customers (Moshin & Lockyer, 2010). In order to create sustainable competitive advantages for an organization, a hotel’s service has to be excellent )Lu et al 2015)
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