Total customer satisfaction is one of the most important strategic weapons of best‐practice hotel organizations. However, hotel organizations cannot achieve total customer satisfaction without gaining the knowledge of a hotel’s competitive position in the changing marketplace and realizing the opportunity of continuous service improvement. With this in mind, this paper develops a set of service benchmarks that help hotel managers monitor their service delivery process, identify performance gaps, and take corrective action. In particular, we propose dynamic benchmarking based on the analytic hierarchy process (AHP) that goes beyond traditional service performance measures. Based on the longitudinal surveys of customers who have stayed at first‐class hotels in Korea, this paper illustrates the usefulness of dynamic benchmarking for continuous service improvement.
PurposeTo help fast‐food restaurants enhance their competitiveness and then increase their market share, the purpose of this paper is to measure the service performances of fast‐food restaurant franchises in the USA and identify salient factors influencing the service performances of fast‐food restaurants over time.Design/methodology/approachThis paper develops a set of benchmarks that helps fast‐food restaurants monitor their service‐delivery process, identify relative weaknesses, and take corrective actions for continuous service improvements using analytic hierarchy process and competitive gap analysis.FindingsThis study reveals that a service attribute considered most important to the fast‐food restaurant customers' impressions of service quality is taste of food. This preference has not been changed over time. Also, we found a pattern of the correlation between the overall level of customer satisfaction with the fast‐food restaurant and its word‐of‐mouth reputation. Furthermore, we discovered that the customers tended to be more favorable to easily accessible and national fast‐food restaurant franchises than less accessible, relatively new, and regional counterparts.Research limitations/implicationsThe current study is limited to the evaluation of comparative service quality in the USA. Thus, this study may not capture the national differences in the restaurant customers' perceived service quality.Practical implicationsFor the last four decades, Americans' obsession with fast serving, cheap meals has made the fast‐food restaurant a mainstay in their daily life. As the appetite for fast food grows, every corner of the American Society has been infiltrated by fast‐food restaurants. With the increasing number of fast‐food restaurants competing in the market, their survival often rests on their ability to sustain high‐quality services and meet changing needs/preferences of customers. This paper provides practical guidelines for enhancing the competitiveness of the fast‐food restaurant franchise.Originality/valueThis paper is one of the first to compare the service quality of fast‐food franchises in the USA and develop dynamic service quality standards for fast‐food restaurant franchises using a longitudinal study.
As quality and profitability have become inseparable concepts, a growing number of service firms have considered quality their top priority in maintaining competitiveness. Commitment to service quality, however, is nothing more than lip service, unless management develops reliable service quality standards. Perhaps one of the best ways of developing such standards is to compare the firm’s service performance with that of the service leader and reassess its service performance continuously through competitive benchmarking. In an effort to establish practical guidelines for competitive benchmarking, proposes the use of an analytic hierarchy process and a competitive gap analysis. These methods can help the service manager to formulate viable service improvement strategies in the increasingly competitive service industry. Illustrates the usefulness of the proposed benchmarking methodology using the case of Korean luxury hotels.
IntroductionOver the last decade, the Korean hotel industry has grown steadily which has resulted in overconstruction of hotels and increased competition among hotels. In the wake of increasing competition, a growing number of hotel managers have begun to realize the importance of service improvements that can be converted to a competitive advantage. In fact, a recent survey of North American, Western European, and Japanese managers showed that 78 per cent of the surveyed managers believe service improvements are the key to competitive success [1]. Service improvements usually mandate the establishment of service standards and the measurement of service quality. The measurement of service quality, however, is not an easy task due to the intangible and elusive nature of service quality.There are very few precise measures of service quality mentioned in the literature. Nevertheless, quite a few attempts have been made to assess service quality [2][3][4][5][6]. One of the most well-known efforts may be the SERVQUAL instrument introduced by Parasuraman et al. [6]. SERVQUAL is a concise multiple-item scale which was designed to assess the quality of firms in a wide range of service categories. SERVQUAL is intended primarily for identifying the key dimensions of service quality and their contributions to overall customer satisfaction as perceived by current and past customers of a service firm. Although SERVQUAL may help identify the key determinants of service quality, SERVQUAL alone may not help evaluate the firm's comparative service performance. In this era of global competitiveness, the firm should constantly strengthen its competitive edge by surpassing the service performance of other firms and should lure prospective customers away from its competitors by gaining the position of "the best of breed". This paper proposes the use of competitive benchmarking as a means of comparing the service performance of Korean luxury hotels and utilizes an analytic hierarchy process (AHP) and competitive gap analysis as reliable service quality measures.
Purpose -This paper aims to develop a balanced scorecard for measuring the comparative efficiency of Korean luxury hotels and then set the benchmark of performance standards for Korean luxury hotels in the increasingly competitive hotel industry. It also aims to identify the root causes of inefficiencies and then propose ways to improve the competitiveness of Korean luxury hotels. Design/methodology/approach -This paper proposes data envelopment analysis (DEA) to measure the comparative efficiency of six luxury hotel chains in Korea, relative to prior periods and their key competitors. In particular, this paper develops the Charnes, Cooper and Rhodes (CCR) model that is designed to derive weights without being fixed in advance. Also, the results of the CCR model with constant returns to scale were compared to those of the Banker, Charnes and Cooper (BCC) model with decreasing returns to scale. Findings -The paper finds that the declining efficiency within some Korean luxury hotels coincides with more aggressive government crackdowns on bad bank loans in the wake of the International Monetary Fund (IMF) financial crisis and the slow adaptation of some hotels into ongoing hotel industry restructuring. The deep discount in hotel room rates did not necessarily lead to increased room occupancy. The revenue increase is not significantly correlated with the enhanced profitability of Korean luxury hotels. The Korean hotel industry reached the stage of market maturity and therefore the mere expansion of the hotel capacity would not necessarily enhance the hotel's profitability. Originality/value -This paper uncovers the financial weaknesses and strengths of the Korean luxury hotels and identifies challenges and opportunities for the Korean hotel industry. In addition, it helps Korean hotels formulate the future survival strategies by providing the detailed picture of where they stand in terms of competitiveness. This paper is one of the first attempts to utilise DEA to develop performance measures for hotels under the balanced scorecard framework. The proposed DEA can be easily modified or extended to similar settings in other hotels such as budget hotels or other countries such as USA and Japan.
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