|Effects of Corporate Culture on Hotel Performance.|
By Hyun Jeong (Spring) Han
Friday, 31st January 2014
A study identifies certain corporate cultures that are connected to favorable hotel operating results—and other cultures that seem to hold down revenues.
Based on an analysis of hotels in Korea, Han’s study identified combinations of corporate culture and strategic orientation that contributed to enhanced financial performance for these hotels. Certain cultures were associated with better financial results than others.
The innovation-oriented “Adhocracy” culture, for instance helped hotels do better than the tradition-bound “Hierarchal” culture. The family-oriented “Clan” culture was also successful for these Korean hotels, while the transaction-oriented “Market” culture did not do as well.
Well chosen strategic orientations moderated and improved financial results for some of the cultures, but again not all strategies or cultures improved the hotels’ revenue performance.
The opportunity-seeking approach of a “leading” strategic orientation drove favorable financial results for the Clan and Adhocracy cultures, for example, but did not help the Market or Hierarchy cultures.
Other strategic orientations also supported positive financial results, including “future-analytic” and “defensive” strategies. On the other hand, the discounting-oriented “aggressive” strategic orientation returned negative financial results to all hotels in this sample.
Han, who is now a professor at the National Research University Higher School of Economics, Moscow, Russia, presented her findings at QUIS 12, the International Research Symposium on Service Excellence Management, which was hosted at Cornell University. The August CQ presents seven selected QUIS 12 research studies.
The study, “The Relationship among Corporate Culture, Strategic Orientation, and Financial Performance,” was conducted by HyunJeong (Spring) Han, who was a visiting scholar at the Cornell School of Hotel Administration. By special arrangement with Sage Publications, the article will be available at no charge from the Cornell Center for Hospitality Research, which produces the CQ in conjunction with Sage.
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The primary objective of the Cornell Hospitality Quarterly is to publish articles that provide timely and actionable prescriptions for hospitality management practice. The articles we publish are based on important industry challenges that are examined using rigorous methods of inquiry. The content addresses a broad range of topics that are relevant to hospitality, travel, and tourism contexts.
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A unit of the Cornell School of Hotel Administration, The Center for Hospitality Research (CHR) sponsors research designed to improve practices in the hospitality industry. Under the lead of the center's 78 corporate affiliates, experienced scholars work closely with business executives to discover new insights into strategic, managerial and operating practices. The center also publishes the award-winning hospitality journal, the Cornell Hospitality Quarterly. To learn more about the center and its projects, visit www.chr.cornell.edu.