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Procedia - Social and Behavioral Sciences 58 (2012) 11 18

8th International Strategic Management Conference

A Study to Determine the Usage of Strategic Management Tools in

the Hotel Industry
a
a

Akdeniz University, Alanya Faculty of Business, Antalya, 07400, Turkey

Abstract
The competition both in international and national markets created a more complex and changeable market structure. This change
forces companies to plan for long-term, examine the activities of rivals and designate dynamic decisions to sustain their lives. Our
study focuses on the examination of strategic management tools, which help companies to increase their performance and
profitability and analysis of usage level and satisfaction rates of these tools. The survey of this study is conducted on 110 middle
and senior level managers of 32 three-star hotels, 32 four-star hotels and 46 five-star hotels that operate in tourism industry in
Antalya. Analyses results revealed that customer relationship management (CRM), vision/mission statements and total quality
management (TQM) were the most used tools in last five years while CRM, benchmarking and strategic planning are the most used
tools currently. Moreover, this study indicated that there were some differences among hotel classification in their preference to use
strategic management tools.
Keywords: Strategic Management, Strategic Management Tools, Hotels.

2012Published
PublishedbybyElsevier
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8th International
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2012
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Management Conference
1. Introduction
The impact of increasing competition is not only felt by businesses but also individuals. When companies try to be the
best among their rivals and enlarge their costumer potentials and, similarly, individuals want to improve themselves
and compete with each other to be the best. All these flexible environmental conditions force businesses and
individuals to change their classical way of thinking to sustain their lives. Senior executives have to define strategic
priorities in order to create some coherence in their strategy making processes, but at the same time they rely on
individuals throughout the firm to bring to their attention ideas and opportunities for future market development
(Birkinshaw, 2004:469). Therefore, both businesses and individuals should perceive strategic way of thinking as a life
style. Having a vision, planning by taking the possibilities into account and pondering the long-term projects are just a
few needs which the new age has brought us.
Plans and projects change the classical structure of thinking and provide different, strong, sustainable and long-term
returns and form the base of strategic management thought. In this study, we tried to determine the usage rates of

Email address: [email protected]

1877-0428 2012 Published by Elsevier Ltd. Selection and/or peer-review under responsibility of the 8th International Strategic Management Conference
Open access under CC BY-NC-ND license. doi:10.1016/j.sbspro.2012.09.973

12

Faruk Kerem entrk / Procedia - Social and Behavioral Sciences 58 (2012) 11 18

strategic management tools in past and present time in hotels. We also tried to define the priorities of managers as
regards to preferences of strategic management tools. Research population is limited to the hotel enterprises in Antalya
which have three, four and five star.
This study will provide a general overview about strategic management and trends on strategic way of thinking
from past to the present for hotels.
2. Literature Review
2.1. Strategic Management
In general it is stated that the word strategy is based on two different sources. One of these is the word
which means way, line or course and the
name (Eren,
is specially used in
2006: 3). The strategy concept has been used as a military term for centuries.
the field of defense in reference to the name of the Ancient Greek General Strategos and also it is signifies the
knowledge and tactics of this general in the field of defense (Aktan, 2009).
The historical development of the strategy concept in the field of management is discussed in t
written by Mintzberg et al. (2005) and they focus on s
in different areas has caused incomprehensibility. Taking a look at the
different definitions will be useful for better understanding of the word
set of dynamic decisions designated to reach objectives, by
focusing on eventual results in long term which examines the activities of competitors
strategy as a long term plan which is formulated by
ls and
resources, planning the activities, guiding the operations and providing a competitive advantage to determine
objectives which are compatible with changing environmental conditions Porter (2007) who evaluates strategy from
o level of competition in market and
the view of competition defines it
from the view of costumer defines it as an ability to see the changes of customer preferences, observing the changes
of
provide . According to Welch (2005) who was a successful manager of General Motors, strategy is taking decisions
which are definite and clear about how we will compete against our rivals. He also stated that strategy is not about

The business environment of the firm consists of all the external influences that affect its decisions and
performance (Grant, 2005:68). Strategy development requires the firm to understand what critical variables are
changing, the pace at which these changes occurring, and their likely impact on the firm (Fitzroy and Hulbert,
2005:57).

forces driving change in the environment in which it competes. This alignment requires that management invest in
competitive methods that yield the greatest overall financial values to the firm (Olsen et al., 1998). Companies in
hypercompetitive environments succeed or fail based on their ability to manage the process of moving up the
As a result of this tough
escalation ladders, jumping from advantag
competition, we have to decide about which tools will provide us to sustain our profitability and compete against our
rivals.
2.2. Strategic Management Tools
Recently, in parallel with changes and developments that world is facing, many new ideas and concepts have
emerged in the field of management and organization. Flexible environment and intense competition atmosphere force
companies to adopt new concepts, techniques and practices. Various new management techniques have emerged as a

Faruk Kerem entrk / Procedia - Social and Behavioral Sciences 58 (2012) 11 18

result of this effort.

overview to see what kinds of management tools are used and satisfaction levels of these tools. Strategic management
tools which emerged with this strategic view and form the basis of our study are listed as follows:
1. Scenario Planning
2. Vision/Mission Statements
3. Strategic Planning
4. Benchmarking
5. Outsourcing
6. Balanced Scorecard (BSC)
7. Core Competence
8. Supply Chain Management (SCM)
9. Total Quality Management (TQM)
10. BCG Growth-share matrix
11. SWOT Analysis
12. Customer Relationship Management (CRM)
13. Strategic Alliances
Table 1: Strategic Management Tools Which Used in the Research
No.

Tools

Definition

Scenario Planning

Scenarios were developed to investigate the possible future environment for business and educational
establishments involved in the requirements discipline, in a 20-25 year timeframe (Bush and Nuseibeh, 2006).
Mission statement is a set of explanation of the work, adopted values, approaches, philosophies to show the
ut

Vision/Mission
Statements

Strategic Planning

Benchmarking

Outsourcing

Outsourcing is a management strategy focusing on activities which provides competition advantage and to take
advantage of the specialized companies to operate business efficiently for activities not in the main areas

BSC

Core Competence

SCM

TQM

10

BCG Growth-share matrix

mission and vision into a strategic measurement system and a

detailed performance measurement tool which provides a background for strategic management (Kaplan and
Norton, 1999).
A core competency is about the knowledge on successes or failures in recombining knowledge resources. It not
only differentiates among firms but it also differentiates inside a firm amongst several competencies (Banerjee,
2003).
Supply chain management is an integrated system which synchronizes a series of inter-related business
processes in order to facilitate information exchange among various businesses entities (e.g. suppliers,
manufacturers, distributors, third-party logistics providers and retailers) (Min and Zhou, 2002: 232).
s on
quality level and based on the participation of all staff in order to achieve long-term customer satisfaction and
obtain benefits for their staff and the community.
In this technique, the strategic business units take their relative market power into account and analyze the
growth rate of the sector while decisions are taken to improve a corporate strategy for business units (Mirze

11

SWOT Analysis

12

CRM

13

Strategic Alliances

It is a disciplined effort to produce fundamental decisions and actions shaping the nature and direction of an
n legal bounds (Bryson, 1988).

SWOT Analysis is a technique which aims to provide the harmony between internal capabilities and external
opportunities of a company in the process of strategy making (Mintzberg et al., 2005).
CRM helps companies improve the profitability of their interactions with customers, while at the same time;
makes the interactions appear friendlier through individualization (Agrawal, 2002).
A strategic alliance is a partnership based on agreement when two or more businesses come together with their
certain assets and capabilities to accomplish specific purposes without a new name or identity (Mirze and

13

Faruk Kerem entrk / Procedia - Social and Behavioral Sciences 58 (2012) 11 18

14

Hotel enterprises have an important role in the service industry which enlarges its economic capacity day by day. It
is seen that both in Turkish and foreign literature, there are plenty of studies related to management and strategic
management concepts with respect to hotel enterprises. But studies about strategic management tools are limited in the
literature. There is not an exact limit about strategic management tools which are discussed differently in different
sources.
hasizes
that usage level and usage purpose of the strategic management tools can differentiate according to country culture and
strategic decision-making processes as different tools might present alternative valid perspectives. Aldehayyat and
-forces analysis, and analysis of key (critical) success factors; that the use of strategy tools
research found out that vision building strategically helped to motivate the employees and also there needs to be
concrete and measurable objectives and strategies for every stage of the process.
Turkish literature has limited studies regarding the subject of strategic management tools. More importantly, there
revealed that strategic management tools are used by managers intensively by adopting to their organization structure
by considering the literature. They also found out that managers satisfied with the successful results of these tools.
3. Methodology
3.1. Research Goal
In this survey we aimed to determine the usage rates of strategic management tools in past and current time in
terms of hotels. Also we tried to define the priorities of managers as regards to preferences of strategic management
tools which are affected by the economic, social and politic developments.
3.2. Sample and Data Collection
The survey of this study is conducted on 110 middle and senior managers of 32 three-star hotels, 32 four-star hotels
and 46 five-star hotels that operate in tourism industry in Antalya. 451 hotels were contacted via email, post or phone
and informed about the research. However 115 hotels accepted to participate in and fill out the research questionnaire.
Questionnaires obtained from five hotels
should be top managers or middleData obtained from those 110 questionnaires were
analyzed through the SPSS statistical packet program and usage levels of strategic management tools were tested
through percentage analysis. ANOVA analysis is also used to determine the differences about priorities of managers as
regards to preferences of strategic management tools according to hotel classification.
3.3. Analyses and Results
To measure the usage level of strategic management tools, usage satisfaction level of strategic management tools
and priorities for preferences of strategic management tools scale of Rigby (2009) was used. After a literature research
about strategic management tools, 13 popular and common tools are accepted and used in the context of research.
However, 18 items were used to determine the priorities for preferences of strategic management tools. The

The sample consisted of 110 respondents working as middle and senior managers in 3 (%29.1), 4 (29.1) and 5
(41.8) star hotels in Antalya, Turkey. Males accounted for %65.5 of the sample. About half of the sample is between
the ages of 36-50. %47.3 of the respondents had manager title, %25.5 had assistant manager and %27.2 had

Faruk Kerem entrk / Procedia - Social and Behavioral Sciences 58 (2012) 11 18

15

department manager titles. The average tenure with the current organization was 5 for respondents. In terms of
.
Table 2 Usage Rates in Last 5 Years According to Hotel Classification
Strategic Management Tools

3* Hotels
%

4* Hotels
%

5* Hotel
%

Total Usage
%

94
68
70
72
59
75
57
88
56
31
50
44
-

89
88
83
87
75
39
63
38
38
50
32
31
-

91
87
86
78
87
74
65
57
78
65
57
26
-

91
81
80
79
74
63
62
61
57
49
46
34
-

1. CRM
2. Vision/Mission Statements
3. TQM
4. Benchmarking
5. Strategic Planning
6. Supply Chain Management
7. Core Competence
8. Outsourcing
9. Scenario Planning
10. SWOT Analysis
11. Strategic Alliances
12. Balanced Scorecard
13. BCG Growth-Share Matrix

ce of strategic management tools differentiates from industry sector because of the

humantable above. CRM is the most used tool for all classes of hotels. Vision and mission statements is the 2nd most used
tools for four and five-star hotels when three-star hotels focus on outsourcing. It can be explained that when four and
five-star hotels have enough capacity to operate their own basic and non-basic facilities, three-star hotels focus on
their core areas and leave other areas to the professionals with respect to cost problems. Four and star hotels also try to
protect their brand image with vision/mission statements. Quality is a very important factor for hotels which are
responsible to meet the expectations of customers. As a result of this view, total quality management took the 3 rd place
as the most used tools. Balanced scorecard and BCG Growth-Share Matrix are not well known by hotel managers, so
managers are reluctant to use these tools.
Table 3 Present Usage Rates According to Hotel Classification
3* Hotels
Strategic Management Tools
1. CRM
2. Benchmarking
3. Strategic Planning
4. Vision/Mission Statements
5. TQM
6. Supply Chain Management
7. Core Competence
8. Outsourcing
9. SWOT Analysis
10. Scenario Planning
11. Strategic Alliances
12. Balanced Scorecard
13. BCG Growth-Share Matrix

4* Hotels

5* Hotel

Total Usage

Usage
%

Satisfaction

Usage
%

Satisfaction

Usage
%

Satisfaction

Usage
%

Satisfaction

85
75
75
79
73
79
71
83
50
60
54
48
-

4.13
4.00
3.59
3.87
3.79
3.86
4.20
4.22
3.63
3.70
2.89
3.44
-

87
92
77
73
77
60
69
61
73
58
60
48
-

4.20
4.20
4.25
4.09
4.00
4.34
4.30
4.05
4.00
4.13
4.00
3.50
-

94
78
84
82
82
76
71
62
71
72
61
47
-

4.05
4.16
4.24
4.20
4.10
4.11
4.00
3.87
4.00
4.23
3.74
3.84
-

90
81
79
79
78
72
70
70
65
65
61
48
-

4.13
4.12
4.08
4.07
3.98
4.06
4.14
4.03
3.92
4.06
3.59
3.57
-

Customer relationship management is on the top by both in the usage and satisfaction rates of the tools.
Benchmarking which is seen as a strategic management tool by managers is took the second place in usage rates.

Faruk Kerem entrk / Procedia - Social and Behavioral Sciences 58 (2012) 11 18

16

Developing competitive structure of the industry increased the value of benchmarking and also affected the usage rates
of this tool. Compared to past years, benchmarking reached the 2 nd place from 4th place. Strategic planning which
provides a more detailed future plan for companies reached 3rd place from the 5th place. Vision/Mission statements and
total quality management still maintain its importance for hotels in terms of image and quality service.
Table 4 Priorities for Preference of Strategic Management Tools
Priorities of Strategic Management Tools

3* Hotels
Agree

4* Hotels
Agree

5* Hotels
Agree

Total
Agree

Innovative activities are very important for the improvement of our company.
Organizational culture is as important as strategy for business success.
We consider the possible changes for the future during decision making
process.
Customer demands and expectations form the basis of our business activities.
Our company maintains activities by with awareness of its abilities.
When taking long-term decision,
are considered
primarily.
We always carry out our activities by considering the aim to become a leader in
the market.
Providing quality service is more important than owning a big share in the
market for our company.
Our company has a powerful structure to perform all of its activities.
Employee performance forms the basis of our performance evaluation process.
O
outsourcing in the necessary areas.
We will pursue sustainability initiatives even if they hurt our profits.
We prevented the negative effects of 2009 crisis by pre-anticipating.
We share our dreams with customers and employees to have a better image.
We take our decisions based on short-term financial returns.
supplying of necessary goods and services.
We make our decisions by drawing imaginary tables for the future to reach our
aims.
Our company can act as an imitator

4.44
4.25
4.25

4.75
4.88
4.57

4.61
4.48
4.48

4.60
4.53
4.44

4.25
3.94
4.38

4.88
4.63
4.32

4.18
4.22
4.14

4.40
4.26
4.26

4.07

4.32

4.18

4.19

3.75

4.38

4.14

4.10

4.07
3.63
4.19
3.00
3.32
3.13
3.13
2.50
3.13

4.25
3.75
3.44
4.00
3.75
3.57
3.00
2.82
2.75

3.57
4.04
3.74
3.92
3.70
3.22
2.87
2.79
2.27

3.91
3.84
3.79
3.68
3.60
3.30
2.99
2.71
2.66

2.50

2.57

2.48

2.51

The results of the analysis show that the most important factor which shapes the preference of strategic
management tool is innovative activities (x=4.60) for hotels. Organizational culture (x=4.53) is the second most
important factor which provides harmonization between strategic management tools and culture of the organization.
Considering possible changes to make decisions (x=4.44) is another important factor for hotel managers when they
plan long-term profitability and performance. Costumer demands and expectations (x=4.40) and awareness of its
abilities (x=4.26) are also important factors for hotels when deciding which strategic management tool is more useful
them.
Table 5 ANOVA Analysis Results
Organizational
Culture
Hotel Star

3*
4*
5*
ANOVA Analysis

32
32
46

x
p= 0.001
Powerful
Structure

Hotel Star

3*
4*

32
32

Sustainability
Initiatives

Imaginary Tables

Costumer
Demands &
Expectations

p= 0.001

p= 0.013

p= 0.000

Quality Service

Being Aware of
The Abilities

Outsourcing

Faruk Kerem entrk / Procedia - Social and Behavioral Sciences 58 (2012) 11 18

5*
ANOVA Analysis

17

46
p= 0.018

p= 0.004

p= 0.002

p= 0.023

According to the results of ANOVA analysis, there are differences between the priorities for preference of strategic
management tools and hotel classification. When four star hotels consider organizational culture, costumer demands
and expectations strongly, three and five star hotels consider them as well, but not as strong as four star hotels.
Sustainability initiatives are also important factors for four and five star hotels except 3 star hotels. When idea of
drawing imaginary tables for the future is not supported by five star hotels, three star hotels respond as undecided. A
powerful structure to operate all kind of activities by itself, providing quality service for its costumers and awareness
of its abilities are very important factors for four star hotels. Outsourcing is also considered as an important factor for
three star hotels compared to four star hotels.
4. Conclusion
This study emphasizes the usage rates of strategic management tools according to the past and present situations of
the hotels. Furthermore, this study focused on the priorities of the hotels when they preferred which tool was more
useful and profitable for their activities. This study indicated that hotels, which were trying to increase their
profitability and customer potential in past years, used tools which are based on the customer satisfaction like CRM,
Vision/Mission Statements and TQM. After the structure of the competition has changed and escalated, hotels
changed the tools they were using to compete against their rivals. Focusing on customer expectations became more
necessary when they have lots of alternative options about where they can spend their money. Accordingly CRM still
remained in the first place in the current position as the most used too
supporting decision making process with strategic motives and planning not only long-term but strategically are some
factors that companies should consider. Benchmarking ranked the 2 nd place and Strategic Planning ranked the 3rd place
in current position as most used tools. A surprising result is that Core Competence outshines with satisfaction level
compared to other tools and ranked the 1 st place.
Innovative activities, organizational culture and considering possible changes for the future are the most important
factors for hotel managers about preferring tools. Following new technologies to improve communication,
harmonizing tools with organizational culture and observing external environment changes help companies to compete
against their rivals.
However, this survey is conducted on three, four and five star hotels of Antalya, Turkey. It is recommended that
further researches can be conducted on city hotels, and also in different countries for the generalization of findings.
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