modelling the determinants of the business performance of small and micro accommodation ...

272 Pages·2017·3.71 MB·English

MODELLING THE DETERMINANTS OF THE BUSINESS
PERFORMANCE OF SMALL AND MICRO ACCOMMODATION
ENTERPRISES IN THE FORMAL SECTOR
IN SOUTH AFRICA
HENDRIK JOHANNES CHRISTOFFEL VAN ZYL
Dissertation presented for the degree of
Doctor of Philosophy in Business Management and Administration
at Stellenbosch University
Promoter: Dr Babita Mathur-Helm
December 2017
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Declaration
By submitting this dissertation, I, Hendrik Johannes Christoffel van Zyl, declare that the entirety of the
work contained herein is my own, original work, that I am the owner of the copyright thereof (unless to
the extent explicitly otherwise stated), and that I have not previously in its entirety or in part submitted
it for obtaining any qualification.
H.J.C. van Zyl December 2017
Copyright © 2017 Stellenbosch University
All rights reserved
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Acknowledgements
I would like to express my sincere appreciation to the following people for their valued contributions to
my research experience:
• My study leader, Dr Babita Mathur-Helm, thank you very much for all the hours of dedication.
• Professor Eon Smit, Professor Mias De Klerk and Professor Charlene Gerber for extremely
valuable conversations, critique and advice.
• Professor Martin Kidd for professional assistance and advice with the statistical analyses.
• Dr John Morrison for friendly support and advice with the research methodology.
• Ronél Gallie for the technical editing.
• Jeanne Enslin for the language editing.
• All the personnel of the University of Stellenbosch Information Centre for assistance with the
literature search.
• My parents, Willem and Sylvia van Zyl, for their love, hope and inspiration to complete this study.
• My wife, Irma van Zyl, for her love, encouragement and support.
• My Creator, for the potential and opportunity to complete this study.
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Abstract
This study investigated the nature and the extent of the inter-relationships between the Kirznerian and
Schumpeterian entrepreneur types and decision styles, decision context prioritisations, strategic
orientations as determinants of small accommodation enterprise performance within the formal South
African accommodation enterprise sector. The study distinguished between two decision styles,
namely cognitive and emotive decision making. Quality, customer satisfaction, impact on the natural
environment, speed of reaction, ethical conduct and profit maximisation were considered as decision
context prioritisations. Market and relationships strategic orientations were considered as alternative
strategic alignments. The small tourism enterprise performance construct was assessed by
considering the number of customers, amount of customer spending, profit margin, number of
employees, number of loyal customers, sales revenue, total costs and total employee costs of the
accommodation enterprises.
The demographic profiles of the accommodation enterprise owner-managers were explored and
characterised according to the age of the venture, age of the owner-manager, the owner-manager’s
experience in the tourism industry, number of employees, gender, language, motivation to be in the
tourism industry and the location of the enterprise in South Africa. The various associations between
the demographic profile variables and entrepreneur types, decision styles, decision context priorities,
strategic orientations and small tourism enterprise performance were additionally determined.
Techniques such as exploratory factor analysis, correlation analyses, multiple regression analyses,
Chi-square analyses, analyses of variance and partial least squares structural equation modelling
were applied to analyse the data.
The main determinants to small accommodation enterprise performance, as modelled by this study,
were found to be the possession of a growth-oriented mindset, the utilisation of a cognitive decision
style and the application of a market strategic orientation. The link between Kirznerian and
Schumpeterian entrepreneur types and small accommodation enterprise performance was additionally
found to be through the mediating role of a market strategic orientation. Significant associations
between some demographic variables and small enterprise performance, market strategic orientation
and decision context variables were described. Schumpeterian entrepreneur type was found to rank
profit maximisation as decision priority low relative to quality, customer satisfaction and ethical
orientation.
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Key words: Kirznerian entrepreneur type; Schumpeterian entrepreneur type; cognitive decision
making; emotive decision making; market strategic orientation; relationships strategic orientation;
decision context priorities; small tourism enterprise performance.
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Table of contents
Declaration ii
Acknowledgements iii
Abstract iv
List of tables xi
List of figures xvi
List of acronyms and abbreviations xviii
CHAPTER 1 INTRODUCTION AND STATEMENT OF THE PROBLEM 1
1.1. INTRODUCTION 1
1.1.1. Entrepreneurial decision making 3
1.1.2. Entrepreneur types 5
1.1.3. Entrepreneurial strategic orientations 6
1.1.4. Small tourism enterprise performance 7
1.1.5. Decision context 9
1.2. RESEARCH PROBLEM 12
1.2.1. Main research question 12
1.3. OBJECTIVES OF THIS STUDY 13
1.4. RESEARCH HYPOTHESES 14
1.5. RESEARCH METHODOLOGY 14
1.6. LIMITATIONS AND DELIMITATIONS 16
1.7. SIGNIFICANCE OF THIS STUDY 16
1.8. STRUCTURE OF THE STUDY 17
1.9. CONCLUSION 18
CHAPTER 2 LITERATURE REVIEW 19
2.1. INTRODUCTION 19
2.2. THE DEVELOPMENT OF ENTREPRENEURIAL THOUGHT 20
2.3. ENTREPRENEURIAL DECISION MAKING 25
2.3.1. Cognitive decision making 28
2.3.2. Emotive decision making 33
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2.3.3. Summative remarks on cognitive and emotive decision-making 38
2.4. ENTREPRENEUR TYPE 39
2.4.1. Opportunity recognition and the Kirznerian entrepreneur 40
2.4.2. Creativity, innovation and the Schumpeterian entrepreneur 44
2.4.3. Summative remarks on entrepreneur types 47
2.5. DECISION CONTEXT 48
2.5.1. Quality 49
2.5.2. Speed of response 50
2.5.3. Ethical orientation 52
2.5.4. Profit maximisation 54
2.5.5. Customer satisfaction 55
2.5.6. Impact on the natural environment 56
2.5.7. Summative remarks on decision context 57
2.6. STRATEGIC ORIENTATIONS 57
2.6.1. Market orientation 57
2.6.2. Relationships orientation 59
2.7. SMALL TOURISM ENTERPRISE PERFORMANCE 61
2.7.1. Tourism in context 61
2.7.2. Tourism value chain 62
2.7.3. Weiermair’s Destination Tourism Value Chain Model 63
2.7.4. Yilmaz and Bititci’s Tourism Performance Value Chain Model 64
2.7.5. European Customer Satisfaction Index (ECSI) 67
2.7.6. Tourism performance criteria 68
2.7.7. Objective performance criteria 68
2.7.8. Subjective performance criteria 71
2.7.9. Moderators of performance 72
2.7.10. Summative remarks for small and micro accommodation enterprise performance 73
2.8. ENTREPRENEUR AND ENTERPRISE SYSTEMS CONTEXT 74
2.8.1. Typical role and functions of the small tourism accommodation entrepreneur 79
2.9. A PRIORI MODEL 80
2.10. CONCLUSION 81
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CHAPTER 3 RESEARCH METHODOLOGY 82
3.1. INTRODUCTION 82
3.2. THE QUANTITATIVE APPROACH 82
3.2.1. Formulation of objectives 83
3.2.2. Research framework 83
3.2.3. Questionnaire development 83
3.2.4. Data types 84
3.2.5. Data sources 85
3.2.6. Pilot testing 85
3.2.7. Validity and reliability 89
3.2.8. Addressing bias 90
3.2.9. Scale descriptors 91
3.2.10. Demographic variables 93
3.2.11. South African definition of SMEs 94
3.2.12. The population 94
3.2.13. The sample 96
3.2.14. Data collection 96
3.2.15. Data analyses 97
3.2.16. Descriptive statistics 99
3.2.17. Hypothesis testing 99
3.2.18. Exploratory factor analysis 101
3.2.19. Chi-squared hypothesis testing 104
3.2.20. Analysis of variance (ANOVA) 105
3.2.21. Correlation and regression analyses 106
3.2.22. Partial least squares structural equation modelling (PLS-SEM) 107
3.2.23. Summary 108
3.2.24. Ethical clearance 108
3.3. CONCLUDING REMARKS 109
CHAPTER 4 EMPIRICAL RESULTS 110
4.1. INTRODUCTION 110
4.2. RESPONSE HISTORY 110
4.3. QUANTITATIVE ANALYSES 114
4.3.1. Factor structure of measurement instrument 116
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4.3.2. Reliability and validity of constructs 120
4.3.3. Non-response bias 126
4.3.4. Analysis of the relationships between construct variables and venture age, owner-
manager age, owner-manager experience and number of employees 128
4.3.5. Analysis of the associations between owner-manager’s gender, language, motivation to
be in business, location and qualification 129
4.3.6. Analysis of the associations between the STEP, CDS, EDS, KET, SET, MSO, and RSO
constructs with demographic variables 131
4.3.7. Analysis of decision context relationships 139
4.3.8. Analysing the inter-relationships between STEP, CDS, EDS, KET, SET, MSO and RSO 154
4.3.9. Analysing predictive relationships between STEP, CDS, EDS, KET, SET, MSO and
RSO 155
4.3.10. Analysis of the predictive relationships between the main constructs 157
4.3.11. A priori PLS-SEM model 158
4.4. REVISITING THE A PRIORI MODEL 162
4.5. A UNIFIED MODEL OF SIGNIFICANT RELATIONSHIPS 163
4.6. SUMMARY 166
CHAPTER 5 SYNOPSIS, CONCLUSIONS AND RECOMMENDATIONS FOR
FUTURE STUDIES 167
5.1. INTRODUCTION 167
5.2. SYNOPSIS OF THIS STUDY 167
5.3. SUMMARY OF RESULTS 169
5.3.1. Demographic profile 169
5.3.2. Sample characteristics and generalisation 170
5.3.3. Association between demographic variables 171
5.3.4. Association between demographic variables and the main constructs 171
5.3.5. Decision context priorities and associations with demographic variables 172
5.3.6. Decision context priorities and associations with the main constructs 173
5.3.7. Relationships between the main constructs 173
5.4. A COMPARISON OF MODELS 174
5.4.1. Original conceptualisations 174
5.4.2. Final model evaluation 177
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5.5. CONTRIBUTION TO THE BODY OF KNOWLEDGE 181
5.6. IMPLICATIONS OF THE FINDINGS 182
5.7. MAIN LIMITATIONS OF THIS STUDY 183
5.8. RECOMMENDATIONS FOR FUTURE RESEARCH 184
REFERENCES 185
APPENDIX A: QUESTIONNAIRE ITEMS 208
APPENDIX B: APPLICATION FOR ETHICAL CLEARANCE 212
APPENDIX C: ETHICAL CLEARANCE APROVAL LETTER 216
APPENDIX D: LETTER OF APPROACH 217
APPENDIX E: COMPLETING THE QUESTIONNAIRE 218
APPENDIX F: DESCRIPTIVE STATISTICS 219
APPENDIX G: INFERENTIAL STATISTICS 234