An analysis of business competencies important for entry-level managers in destination marketing organizations
v Table of Contents Acknowledgments iv List of Tables viii List of Figures ix CHAPTER 1. INTRODUCTION 1 Introduction to the Problem 1 Statement of the Problem 7 Purpose of the Study 8 Rationale 8 Significance of the Study 9 Research Questions 9 Definition of Terms 11 Assumptions 13 Limitations 13 Ethical Considerations 13 Organization of the Remainder of the Study 14 CHAPTER 2. LITERATURE REVIEW 15 Introduction to Hospitality 15 Hospitality Segments 19 Hospitality Curriculum 32 Competency Models in Hospitality 34 Summary 39
vi CHAPTER 3. METHODOLOGY 41 Introduction 41 Sample Population 42 Instrumentation 42 Data Collection 44 Data Analysis 44 CHAPTER 4. RESULTS 46 Introduction 46 Data Collection 46 Response Rate Analysis 47 Instrumentation Validity/Reliability 48 Participant Characteristics 51 Objective 1 Findings 51 Qualitative Analysis 59 Objective 2 Findings 62 Objective 3 Findings 64 Summary 64 CHAPTER 5. DISCUSSION, IMPLICATIONS, RECOMMENDATIONS 65 Discussion 65 Implications 78 Recommendations for Future Research 80 Conclusion 81
vii REFERENCES 87 APPENDIX A. Invitation to Participate 92 APPENDIX B. Survey Instrument 93
viii List of Tables Table 1. Competency Literature Review 40 Table 2. Early/Late Response Statistics 48 Table 3. Independent Samples t Test 50 Table 4. Composite Mean Scale 52 Table 5. Top Competency Dimensions 52 Table 6. Means and Standard Deviations of the Competencies and Dimensions in Descending Order 54 Table 7. Curriculum Matrix 63
ix List of Figures Figure 1. Research Design 41
1 CHAPTER 1. INTRODUCTION
Introduction to the Problem Until recently, the terms hospitality industry and travel and tourism industry were often used interchangeably, without regard to how they connect (Ninemeier & Perdue, 2007). Yet Ninemeier and Perdue’s research has identified distinct differences between these two sectors: (a) The hospitality industry refers primarily to organizations that provide accommodations and foodservice for people when they were away from home, and (b) the travel and tourism industry describes organizations that cater to the leisure needs of the traveling public (e.g., cruise ships; air, rail, and ground transportation; gaming, amusement parks, and local and national attractions). Hospitality researchers (Astroff & Abbey, 2006; Walker, 2004) agree that the hospitality and travel and tourism industries (HTTI) are the largest and fastest growing industries in the world. The HTTI are primarily four segments that together form partnerships to provide (a) lodging, (b) foodservice, (c) travel and transportation services, and (d) amusement and recreational attractions for travelers to a destination (Astroff & Abbey, 2006). HTTI organizations create a dynamic, global economy that the World Travel and Tourism Council estimated was responsible for 11% of the gross domestic product, 200 million jobs, 8% of the total employment, and 5.5 million new jobs per year until the year 2010 (Walker, 2004, p. 5). These impressive numbers support the value of HTTI and their contributions to society in terms of providing leisure activities and employment opportunities for the general public. Travel Industry Association (TIA) has approximately 750 HTTI member organizations that have the potential to positively influence employment and economies in cities in the United States. Studies conducted by Destination Marketing Association International (DMAI; 2007)
2 found that lodging organizations, restaurants, and amusement and recreation venues account for an estimated $740 billion spent in the United States. Although lodging organizations and foodservice represent the majority of dollars spent, significant growth in the sub-segments of meeting and convention planning, tradeshow expositions, gaming and recreation, and cultural tourism occurred (Ninemeier & Perdue, 2007). Over the past decade, HTTI customer patterns shifted from two separate groups (i.e., business travelers, and leisure and pleasure travelers) to the current blended paradigm. Changing demographics and lifestyle attitudes contributed to new opportunities for cities to earn substantial revenue from travelers who routinely mix business with pleasure (Travel Industry Association, 2007). Bundling and promoting meetings, conventions, travel and tourism, and leisure markets together created a new market niche that involves family members and extended weekends (Astroff & Abbey, 2006). This phenomenon was described as a lucrative system composed of large hotel room blocks, detailed decorating schemes, exotic banquet foods, five-star restaurants, and state-of-the-art technological productions, all themed to satisfy savvy customers (Ninemeier & Perdue, 2007). Two specific trends greatly influence the way destinations acquire and maintain hospitality business: (a) the economic impact generated by commercial foodservice organizations in such places as retail shops, theme parks, sports and recreation foodservice operations, and private clubs; and (b) the growing use by the meeting and convention planning sector of all HTTI services, including cultural and amusement services, adding to the visibility of tourism in cities across the country (Ninemeier & Perdue, 2007). Destination marketing organizations (DMOs) are important to study because they (a) contribute to economic growth by bundling HTTI services to increase the number of visitors to a city, (b) add revenue to the tax base, and (c) provide national visibility for the community. DMAI (2007) described the
3 uniqueness of this segment as a composition of lodging organizations, restaurants, event services and suppliers, retail establishments, and cultural institutions that play a pivotal role in terms of work by generating employment and revenue from taxes and in terms of leisure through the hospitality and travel-related organizations that bring guests to a city. Walker (2007) believed that DMOs aid in the long-term development of communities through travel and tourism strategies because DMOs bundle HHTI organizations and sell them as a package. Continuous growth in travel and tourism along with changing trends in customer patterns present challenges in ensuring that hospitality education keeps pace with developing competencies required by business and industry. According to hospitality researchers (Goodman & Sprague, 1991), skills and competencies used in hospitality management workplaces have changed from purely vocational and task-oriented, discrete functions separated by department to total quality management systems in which everyone is responsible for organizational growth. Tracey and Hinkin (1994) argued that early training in hospitality management prepares entry- level managers “in the classical management style emphasizing planning, organizing, leading and controlling” (p. 18). They believed that issues such as shrinking labor forces, economic conditions, and environmental influences have contributed to the paradigm shift of competencies needed in hospitality management. Their theory suggested that improving leadership competencies in hospitality organizations is a way to advance the efficient use of human resources. Their findings concluded that managers who exhibit transformational leadership characteristics such as a strong sense of vision and the ability to clearly communicate organizational objectives, and managers who consistently demonstrate emotionally intelligent behavior with internal and external customers, have a positive effect on individual and organizational outcomes.
4 In 1983, Tas identified 36 job competencies judged essential to performing the duties of an entry-level lodging manager. He defined entry-level job competencies as “those that are performed independently by the manager trainee, as well as those that require guidance from a professional or superior” (p. 42). Tas (1983) developed a survey instrument that began with a compilation of 70 competencies identified from a review of the literature that may be needed by hotel manager trainees. Two panel reviews (one for clarity and one for content validity) narrowed the number of job competencies to 36. Competency statements were randomly listed on the survey, which ranked behaviors associated with each domain in order of importance from 1 (no importance) to 5 (essential competency). Tas (1983, 1988) argued that five core competencies deemed essential for entry-level hotel manager’s center on human relations abilities: self-management, communication, interpersonal, leadership, and critical thinking. He determined that lodging organizations would run more efficiently if competencies in these specific areas were attained by management trainees. Since then, several studies have used a modified Tas (1988) competency model as a framework to develop instruments to investigate competencies in lodging (Brownell & Chung, 2001; Goodman & Sprague, 1991; Kay & Russette, 2000). Chung-Herrera, Enz, and Lankau (2003) believed that industry-wide competency models are important because they inform students and employees about expectations for future leadership as identified by senior-level managers. They strongly believed that knowledge of an industry’s core competencies helps organizations identify and manage human resource activities that are valued and mission driven. Continued success in hospitality organizations is predicated on how well organizations are able to directly pinpoint the skills and competencies required for future leadership and implement them into everyday human resource activities.
5 In their study titled “Grooming Future Hospitality Leaders: A Competencies Model,” Chung-Herrera et al. (2003) developed a competency model to identify managerial behavior that hospitality executives anticipated would be needed in the future. A number of different competency studies were reviewed to produce a pilot survey that captured the most important dimensions of leadership behavior across several industries, resulting in 99 competencies that contribute to leadership success in the hospitality business. Based on feedback from the pilot, Chung-Herrera et al. refined the final competency model to reflect hospitality-specific behavior and identified eight principal factors: communication, critical thinking, implementation, industry knowledge, interpersonal skills, leadership, self-management, and strategic positioning. Each factor had up to six dimensions that captured various aspects of that factor. Chung-Herrera et al. received 137 responses out of 735 surveys sent, representing a response rate of 18.6%. They believed this low response rate was typical for executive-level employee industry leaders. Previous studies on chief executive officers have shown response rates to be in the 13% to 20% range (Agle, Mitchell, & Sonnefeld, 1999). The results of Chung-Herrera et al.’s study identified two top competency dimensions important for entry-level managers in hotels: (a) self- management, composed of ethics and integrity, time management, flexibility, adaptability, and self-development; and (b) strategic positioning, composed of awareness of customer needs, commitment to quality, stakeholder management, and concern for the community. This competency model focused on behavior rather than on personality traits, primarily because desirable traits are easier to measure than personality (Chung-Herrera et al., 2003, p. 19). Competency models are useful to human resources because they identify specific objectives and measure effective performance (Chung-Herrera et al., 2003). Organizational benefits for employing competency models in strategic planning are that they (a) provide a clearer
6 understanding of what is important to organizational objectives, (b) can be used as a foundation to discuss capabilities and performance measures in industries’ common language, and (c) can be used to enhance human resource activities. Chung-Herrera et al. identified eight human resource functions that could benefit from a well-developed competency model: (a) recruitment and selection; (b) training and development; (c) performance appraisals; (d) coaching, counseling, and mentoring; (e) reward systems; (f) career development; (g) succession planning; and (h) change management. Chung-Herrera et al. believed that the ability to identify skills and core competencies needed for entry-level management is essential if organizations are to remain competitive in the 21st century. They theorized that the ability to identify skills and competencies required for future leaders is critical for the growth and development of specific curriculum and that competency models support hospitality organizations in improving human resource initiatives. Hospitality educators (Dittman, 1997, 2000; Lefever & Withiam, 1998; Tesone & Ricci, 2005) focused on the collaboration of hospitality education and hospitality-business-led curriculum paradigms. Their theories have argued that effective core competency models needed by entry-level hospitality managers are determined by hospitality industry leaders and are useful tools for both hospitality organizations and hospitality educators to adopt. Chung-Herrera et al. (2003) found that competency models paint a comprehensive picture of critical skills needed by the organizations that implement them. They also believed that competency models could aid in educating future generations of leaders by guiding university facilities in designing curricula to meet the industry’s changing needs. Due to continuous growth in DMOs and tourism, it is important to identify business competencies needed to be successful in an entry-level management position in a DMO, analyze
7 current curricula in hospitality programs in institutions of higher education, and determine if institutions of higher education are teaching curricula that meet the needs of this segment of the industry. This research determined the responsiveness of 2- and 4-year universities to the destination marketing sector and may contribute to revised and improved hospitality curricula.
Statement of the Problem Continuous growth in HTTI requires a better understanding of the skills and competencies that are important in entry-level management positions (Astroff & Abbey, 2006). Too often hospitality education is seen as vocational training rather than as business training, creating a narrow-minded view that could slant hospitality curriculum development toward operations rather than adopting hospitality education paradigms based on mainstream business needs (Jauhari, 2006, p. 130). In the United States, changing travel patterns have contributed to the blurring of hospitality segments, creating positive economic impacts that can be measured by the increase in tax dollars for improvements in state services and infrastructure. Equally beneficial is the enhanced quality of life for local citizens in terms of leisure and work, by attracting visitors to a destination and providing jobs in the community (DMAI, 2007). Projections in tourism growth indicate that DMOs will continue to provide employment opportunities and pleasurable moments of truth for travelers. Determining which business competencies are important for this unique segment of HTTI will provide first-hand data for future curriculum development and be useful for human resource management departments in making future hiring and training decisions. Therefore, it was necessary to conduct a study to determine which business competencies are important for entry-level managers in DMOs, analyze business competencies currently being taught in institutions of higher education, and
8 determine the responsiveness of institutions of higher education to the needs of this segment of the HTTI.
Purpose of the Study This study had three objectives: (a) to identify business competencies important for entry- level management in DMOs as viewed by DMO executives, (b) to analyze business competencies currently being taught in higher education facilities with tourism programs, and (c) to determine if institutions of higher education with hospitality programs are responsive to the needs of the DMO segment of the industry. Determining the business competencies important for entry-level management in a DMO is beneficial in several respects: (a) Industry executives will determine the importance of specific business competencies germane to this segment, (b) hospitality educators will have data that may enhance future curriculum development in destination marketing, and (c) hospitality students will know which business competencies are sought by DMOs. Therefore, it was necessary to investigate the business competencies important for entry-level managers in DMOs as seen through the lens of industry executives, analyze the business competencies currently being taught in higher education hospitality tourism programs, and determine the responsiveness of institutions of higher education with hospitality programs to the growing needs of the industry.
Rationale The study was a population-specific inquiry regarding the importance of job competencies taught in hospitality tourism programs in institutions of higher education in the United States (Locke, Spirduso, & Silverman, 2007). The outcome of the assessment provides
9 specific information on the business competencies important to entry-level management in this population. The findings can be measured against current curricula at 2- and 4-year university hospitality programs to make a judgment about the responsiveness of higher education to the needs of this segment. Significance of the Study Significant growth in terms of quality of work, specialization, and professionalism in DMOs supports the need to know which business competencies are perceived as important to being successful in entry-level management (Astroff & Abbey, 2006). The present study identified business competencies ranked in order of importance for entry-level managers as viewed by industry executives, analyzed business competencies currently being taught in hospitality tourism programs in higher education facilities, and determined the responsiveness of higher education with hospitality programs to this segment’s needs. The research addressed the problem in three ways: (a) Business competencies important to the segment were identified by the people who do the work; (b) hospitality tourism programs were analyzed to determine if revisions or adjustments in curriculum need to be made; and (c) common themes were found that could influence and enhance recruiting, hiring, and training and development in DMOs.
Research Questions The purpose of the study was to determine the importance of specific business competencies for entry-level management in a DMO. An analysis of business competencies currently being taught in hospitality tourism programs at institutions of higher education was undertaken to determine if higher education programs are meeting the needs of industry.
10 Hospitality researchers (Chung-Herrera et al., 2003; Dittman, 2000; Raybould & Wilkins, 2005) have theorized that understanding and determining job competency expectations improves operational strategies in organizations and guides hospitality educators in redesigning curricula for 2- and 4-year universities. This research study had three objectives: (a) to identify business competencies and rank their importance for entry-level managers in DMOs as viewed by DMO executives, (b) to analyze business competencies in current curricula at institutions of higher education that have hospitality tourism programs, and (c) to determine to what extent the needs of the industry are being met by 2- and 4-year institutions of higher education. To determine which business competencies are important for entry-level managers in DMOs, the researcher asked the following quantitative questions of senior-level executives: 1. What self-management competencies are important for entry-level managers? 2. What communication competencies are important for entry-level managers? 3. What critical-thinking competencies are important for entry-level managers? 4. What interpersonal competencies are important for entry-level managers? 5. What implementation competencies are important for entry-level managers? 6. What leadership competencies are important for entry-level managers? 7. What strategic positioning competencies are important for entry-level managers? 8. What industry knowledge competencies are important for entry-level managers? The following six qualitative questions were asked of senior-level executives: 1. In your opinion, what skills do you believe are critical for tourism students to acquire to be successful in the future? 2. What emerging trends in destination marketing will have the biggest impact on entry- level managers and why?
11 3. To what qualities do you attribute your success in the hospitality industry? 4. What can institutions of higher learning do to improve the leadership ability of its students? 5. What is the biggest challenge facing the destination marketing segment? 6. What can be done about it? An analysis of curricula from randomly selected 2- and 4-year institutions of higher education with hospitality tourism programs provided data on coursework being taught in hospitality programs throughout the United States. A comparison analysis helped make a judgment of the responsiveness of higher education to the needs of DMOs. Definition of Terms The following definitions served to provide clarity and consistency to this study. Business acumen. Expertise in current mainstream business functions such as finance, human resources, marketing, and information technology (Astroff & Abbey, 2006). Competencies. Characteristics of employees with behavioral implications that are thought to be associated with successful performance on the job (Garman & Johnson, 2006). Competency model. A descriptive tool that identifies the knowledge, skills, abilities, and behavior needed to perform effectively in an organization (Chung-Herrera et al., 2003). Core competencies. An organization’s areas of greatest expertise. Organizational core competencies are those strategically important capabilities that provide an advantage in the marketplace or service environment. Core competencies may involve technology expertise, unique service offerings, a marketplace niche, or particular business acumen (“Malcolm Baldrige National Quality Award,” 2007).
12 Curriculum. The educational plan of an institution, school, or department; the design of the academic program in a school or institution (Mayo & Haysbert, 2005). Destination marketing organizations (DMOs). Hospitality, travel, and tourism industries that form partnerships to serve the public, including providing accommodations, visitor centers, convention centers, attraction and cultural institutions, restaurants, and retail establishments (DMAI, 2007). Higher education hospitality curriculum. The specified courses, sequence, and requirements designated to earn a 2- or 4-year degree in hospitality management. Hospitality educator. A current member of the faculty of a program, department, school, or college that grants degrees in the field of hospitality management (International Council on Hotel, Restaurant and Institutional Education, 2006). Hospitality industry. Business organizations representing restaurants; lodging organizations; travel and transportation; and recreation, amusement, and tourism (Walker, 2007). HTTI. Hospitality travel and tourism industries. Industry executives. Senior-level managers in DMOs. Lodging. A facility that offers sleeping rooms and that could also provide food and beverage as well as amenities such as swimming pools and meeting space (Walker, 2004). Moments of truth. Positive or negative opportunities when guests form an impression about a hospitality organization (Ninemeier & Perdue, 2007). Segments. Hospitality management organizations identified in the industry as foodservice, lodging, transportation-related, and recreation and amusement parks (International Council on Hotel, Restaurant and Institutional Education, 2006).
13 Assumptions The researcher made the following assumptions when developing the research design: (a) that curriculum development should be based on core competencies required by the industry, (b) that industry executives would have the knowledge and intellect to contribute to the conversation, (c) that industry executives would identify business competencies germane to future DMO growth, (d) that industry executives would provide relevant information to add to the validity of the study, (e) that the use of e-surveys would be a reliable and valid method of data collection, (f) that replication of a study with proven validity and reliability using a different population would add to the knowledge base of the field, and (g) that the data collection process would be refined and shortened by using an e-survey instrument.
Limitations Other organizations provide training and development for hospitality professionals; however, the focus of this study was on business competencies being taught in curricula in 2- and 4-year institutions of higher education and the responsiveness of these institutions to industry needs. The survey was only sent to senior-level executives at DMOs. The study did not cover all of the professional educators, contract employees, organizational trainers, or professional associations that are available in the hospitality industries.
Ethical Considerations There were no perceived risks or ethical concerns for this research study. Based on the results of the study, proposals can be made for improving destination marketing coursework that may add quality to higher education and vocational programs. The results are anticipated to
14 benefit all stakeholders: Curriculum developers in hospitality management at 2- and 4-year universities will know what competencies are important to DMO industry leaders, and students entering the destination marketing workforce will know which business competencies are important to employers. Participants were assured of the utmost confidentiality, and no safety hazards were associated with this research.
Organization of the Remainder of the Study Chapter 2 begins with an introduction to hospitality management, followed by an overview of the four primary hospitality segments. An assessment of the literature on competency-based models in hospitality management environments and competency models in education and curriculum development is made to support the theory that core competency models are critical components of hospitality education and applied research. Chapter 3 describes the research design, the population, and the methodology to be used to gather the data. The rationale and perceived benefits for using the e-survey are discussed. Chapter 4 reports the findings of the study, and chapter 5 discusses the conclusions and provides recommendations for future research.
15 CHAPTER 2. LITERATURE REVIEW
Introduction to Hospitality Hospitality management organizations are becoming increasingly more important to society in terms of leisure and work because they represent significant contributions to global economies, have a presence in every country in the world, and are diverse and complex entities that are multinational and multicultural workplaces (Sigala & Baum, 2003). An economic impact study by the Convention Industry Council (2004) reported on the enormous economic value of the hospitality industry in that (a) it supports 1,710,000 jobs, (b) it is the 29th largest contributor to the gross national product, and (c) it is accountable for more than $250 billion in direct spending in a global economy. These compelling statistics concurred with recent statements from the International Council on Hotel, Restaurant and Institutional Education (2006) and the World Tourism Organization (WTO; 2004), each of which indicated that travel and tourism is the world’s largest industry and rivals any other in terms of number of employees. Ninemeier and Perdue (2007) identified three emerging trends that continue to forge the industry forward: (a) the increase in hospitality organizations that provide food, entertainment, and destination marketing services to the traveling and non traveling public; (b) the growing convention and meetings segment; and (c) the growth of out-of-home leisure activities such as gaming, cruise ships, and theme. According to Walker (2007), “Hospitality management is an exciting discipline offering numerous career opportunities” (p. 4). Although there is no line item in the budget for promoting travel and tourism in America, governments have recognized the importance of the hospitality travel and tourism industries (HTTI) “not only as an economic force, but also as a social and cultural force of growing significance” (Walker, 2007, p. 29). The
16 Economic Review of Travel Industry Association of America, 2007) revealed that domestic and international travelers spent an estimated $699 billion in HTTI in the United States in 2006. HTTI provided creature comforts, adventure, relaxation, and inner health to the general public, supporting the fact that the United States is a leader in world economics and hospitality travel, and tourism and that what happens in the United States happens to all of society (WTO, 2004). The face of travel and tourism changed forever, creating a state of concern about world peace, security, and travel in the United States, following the terrorist attacks of September 11, 2001 (Convention Industry Council, 2004). Travel agents, tour operators, travel managers, wholesales, and national offices of tourism all felt the ramifications of the terrorist attacks on America. The WTO (2004) reported a drop in as much as 10% of revenue for hotels during the months immediately following the attacks; occupancy levels dropped in most major markets, creating a dismal financial picture for the industry as a whole. These external elements had a rippling effect on the meeting and convention segment because of the impact flying had on travel within and to the United States (Convention Industry Council, 2004). The Convention Industry Council reported that hundreds of meetings and conventions were cancelled in the aftermath of September 11, resulting in significant economic losses for airlines, lodging organizations, and meeting and conventions locally, nationally, and internationally. In a recent study, TIA (2007) reported that travel and tourism has recovered from this slump and that projections are positive for continued growth within all segments of the industry. The study posited that HTTI are a vital part of the economic picture in global marketplaces. Although lodging organizations comprise the largest segment, Ninemeier and Perdue (2007) found that HTTI consist of many businesses that cater to the needs of the traveling public. Other hospitality businesses were identified as (a) air, cruise ships, rail, bus, and other ground transportation; (b) commercial and
17 noncommercial foodservice; (c) attractions such as gaming and amusement parks; and (d) meeting and convention planning. Leading hospitality researchers (Angelo & Vladimir, 2004; Ninemeier & Perdue, 2007; O’Mahony, McWilliams, & Whitelaw, 2001) have argued that hotels, restaurants, and travel- related organizations are an important and positive part of world culture. This global perspective creates a need for hospitality students to develop social, business, and communication competencies. In his study on competencies needed for a career in the hospitality industry, Jauhari (2006) argued that effective hospitality educational models did not focus on specific, vocational skill sets; rather, a balanced curriculum consisting of specific segment knowledge and general business competencies was found to build brand equity in the hospitality industry in India. He believed that growth in the service businesses contributes to the world economy, raising the level of what hospitality management trainees are expected to understand, such as spreadsheets, psychographics, and strategic planning (p. 130). Psychographic knowledge is particularly important to destination marketing organizations (DMOs) because it classifies people’s behavior in terms of lifestyles and values (Angelo & Vladimir, 2004). Knowledge of consumer patterns can help DMOs yield significant direct economic benefits by improving travel and tourism in the United States (TIA, 2007). Chapman and Lovell (2006) argued that the study of core competencies is valuable to an organization because it provides frameworks to identify any gaps or shortcomings that may be barriers to organizational success. Applied and theoretical researchers (Chung-Herrera et al., 2003; Jauhari, 2006; Tas, 1988) have supported the development and use of core-competency- based models germane to a particular segment. These researchers have theorized that competency models have specific benefits when implemented into organizational human