Get 20M+ Full-Text Papers For Less Than $1.50/day. Start a 14-Day Trial for You or Your Team.

Learn More →

The role of hotel owners: the influence of corporate strategies on hotel performance

The role of hotel owners: the influence of corporate strategies on hotel performance Purpose – The purpose of this paper is to examine corporate strategic effects on hotel unit performance. Taking a hotel owner's perspective, the relationship between four types of the owner's corporate level strategies and the hotel property financial performance are examined. Design/methodology/approach – This study is built on a secondary data set provided by Smith Travel Research. A total of 2,012 hotels across the USA were analyzed for the period between 2003‐2005. Findings – The findings support the existence of corporate effects in the US lodging industry. It is revealed that a hotel owner's corporate strategies do influence hotel property level financial performance. Specifically, a hotel owner's expertise in implementing superior strategies regarding segment, brand, operator, and location (i.e. state) are critical to hotel unit financial performance. Research limitations/implications – The main limitations of this study include the limited number of years with available data, lack of knowledge on the names of hotel owners, brands and operators, and the performance measures focusing only operating but not value/return measures. Practical implications – This research shows that a hotel owner can have significant influence on the operating performance of its hotel properties by implementing strategies regarding its properties' locations, segments, brand affiliations and operators. Specifically, brand affiliation has shown a consistently larger impact on both revenue and profit than other corporate strategies, and consequently should receive particular attention from the owner to carefully assess the brand's potential contribution before engaging in a franchise agreement. Originality/value – This research expands the strategy research in the hospitality field by linking two key strategy constructs – corporate effects and corporate strategy – together and by revealing their collective influence on hotel performance. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png International Journal of Contemporary Hospitality Management Emerald Publishing

The role of hotel owners: the influence of corporate strategies on hotel performance

Download PDF
18 pages

Loading next page...
 
/lp/emerald-publishing/the-role-of-hotel-owners-the-influence-of-corporate-strategies-on-tY2rIeMPd0
Publisher
Emerald Publishing
Copyright
Copyright © 2012 Emerald Group Publishing Limited. All rights reserved.
ISSN
0959-6119
DOI
10.1108/09596111211197836
Publisher site
See Article on Publisher Site

Abstract

Purpose – The purpose of this paper is to examine corporate strategic effects on hotel unit performance. Taking a hotel owner's perspective, the relationship between four types of the owner's corporate level strategies and the hotel property financial performance are examined. Design/methodology/approach – This study is built on a secondary data set provided by Smith Travel Research. A total of 2,012 hotels across the USA were analyzed for the period between 2003‐2005. Findings – The findings support the existence of corporate effects in the US lodging industry. It is revealed that a hotel owner's corporate strategies do influence hotel property level financial performance. Specifically, a hotel owner's expertise in implementing superior strategies regarding segment, brand, operator, and location (i.e. state) are critical to hotel unit financial performance. Research limitations/implications – The main limitations of this study include the limited number of years with available data, lack of knowledge on the names of hotel owners, brands and operators, and the performance measures focusing only operating but not value/return measures. Practical implications – This research shows that a hotel owner can have significant influence on the operating performance of its hotel properties by implementing strategies regarding its properties' locations, segments, brand affiliations and operators. Specifically, brand affiliation has shown a consistently larger impact on both revenue and profit than other corporate strategies, and consequently should receive particular attention from the owner to carefully assess the brand's potential contribution before engaging in a franchise agreement. Originality/value – This research expands the strategy research in the hospitality field by linking two key strategy constructs – corporate effects and corporate strategy – together and by revealing their collective influence on hotel performance.

Journal

International Journal of Contemporary Hospitality Management – Emerald Publishing

Published: Feb 3, 2012

Keywords: United States of America; Hotels; Corporate strategy; Hospitality management; Hotel performance; Financial performance

References

  • Corporate effects and dynamic managerial capabilities
    Adner, R.; Helfat, C.E.
  • Selecting partners in an international franchise organisation
    Altinay, L.
  • REIT economies of scale: fact or fiction?
    Ambrose, B.W.; Ehrlich, S.; R, .; Hughes, W.T.; Wachter, S.M.
  • Influence of leadership competency and organizational culture on responsiveness and performance of firms
    Asree, S.; Zain, M.; Razalli, M.R.
  • Firm resources and sustained competitive advantage
    Barney, J.
  • Does corporate strategy matter?
    Bowman, E.H.; Helfat, C.E.
  • The performance of REIT‐owned properties and the impact of REIT market power
    Brady, P.J.; Conlin, M.E.
  • Agglomeration effects and strategic orientations: evidence from the US lodging industry
    Cannina, L.; Enz, C.A.; Harrison, J.S.
  • Focus, transparency and value: the REIT evidence
    Capozza, D.R.; Seguin, P.J.
  • Property type, size, and REIT value
    Capozza, D.R.; Lee, S.
  • How much does the business group matter in Korea?
    Chang, S.J.; Hong, J.
  • Corporate and industry effects on business unit competitive position
    Chang, S.; Singh, H.
  • A hotel investment is only as good as its local market!
    Corgel, J.B.
  • Hotel real estate markets
    Corgel, J.B.
  • Hotel investments in the portfolio: are they part of the core?
    Corgel, J.B.; deRoos, J.A.
  • How national systems differ in their constraints on corporate executives: a study of CEO effects in three countries
    Crossland, C.; Hambrick, D.C.
  • Strategic Management Concepts
    David, F.R.
  • Introduction
    D'Aveni, R.
  • Brands across borders: determining factors in choosing franchising or management contracts for entering international markets
    Dev, C.S.; Erramilli, M.K.; Agarwal, S.
  • The price of lodging stocks: a reality check
    Elgonemy, A.R.
  • The revolution in domestic hotel management contracts
    Eyster, J.J.
  • An analysis of lodging real estate market dynamics
    Gallagher, M.; Mansour, A.
  • The impact of hotel management contracting on IHRM practices: understanding the bricks and brains split
    Gannon, J.; Poper, A.; Doherty, L.