Make or buy in the hotel marketing department: transaction costs, financial and relational performance

Tomás Fco. Espino-Rodríguez, Manuel Rodríguez-Díaz

Abstract


The outsourcing of hotel marketing is one of the strategic decisions that can help hotels manage the distribution channels more efficiently. This work analyzes the factors determining the outsourcing of hotel sales and marketing activities. It uses the transaction costs framework, complemented by the analysis of performance costs and quality. In this context, the possible impact of outsourcing the marketing department on the relational and financial performance is analyzed. The results of the study clearly show a close relationship between those variables and current outsourcing. In addition, the increase in outsourcing is determined by low relational quality. These results lead to the conclusion that it is necessary to create new systems and procedures in sales and marketing activities to offer new competitive solutions by means of outsourcing.


Keywords


outsourcing, marketing and sales, hotel sector, transaction cost, financial, relational

Full Text:

PDF

References


Alleyne, P., Doherty, L. and Greenidge, D.(2006). Human resource management and performance in the Barbados hotel industry.International Journal of hospitality Management, 25(4), 623-646.

Anderson, E. and Schmittlein, D.C. (1984). Integration of the sales forces: An empirical investigation”, Rand Journal of Economics, 15, 385-395.

Argyres, N. (1996), “Evidence on the role of firm capabilities in vertical decisions”, Strategic management Journal, 17,129-150.

Barney, J. B. (1999). “How a firm´s capabilities affect boundary decisions”, Sloan Management Review, 40,173-147.

Bello, D.C., Dant S. and Dant. P., and Lohtia R. (1997). Hybrid gobernance: The role of transactions cost, production cost and strategic considerations, Journal of Business & Industrial Marketing, 12(2),118-133.

Bitner, M.J. and Hubbert, A.R. (1994). Encounter Satisfaction Versus Overall Satisfaction Versus

Bolat, T., Yilmaz, Ö. (2009). The relationship between outsourcing and organizational performance. Is it myth or reality for the hotel sector?. International Journal of Contemporary Hospitality Management, 21 (1), 7-23.

Bustinza, O.F., Arias-Aranda, D., Gutierrez-Gutierrez, L. (2010). Outsourcing, competitive capabilities and performance: an empirical study in service firms. International Journal Production Economics, 126 (2), 276-288.

Cerra, J., Dorado, J., Estepa, D. and García, P. (1997). Gestión de la producción de alojamientos y restauración. Editorial Síntesis. Madrid

Cheon, M., Grover, V. and Teng, J. (1995). Theoretical perspectives on the outsourcing of information systems. Journal of Information Systems,10, 209-219.

Christopher, M., Payne, A. and Ballantyne, D. (1994). Marketing relacional: integrando la calidad, el servicio al cliente y el Marketing, Díaz de Santos, Madrid.

Clathoth, P.K. and Olsen, M. D. (2003). Strategic Alliances: A Hospitality Industry Perspective. International Journal of Hospitality Management, 22, 419-434.

Coase, R. H. (1937). The nature of the firm. Economica, 4, 386-405.

Copulsky, J.R. and Volf, M.J. (1990). Relationship marketing positioning for the future. The Journal of Business Strategy, 11(4), pp.16-20.

Dooney, P. M. and Cannon, J. (1997). An Examination of the Nature of Trust in

Buyer-Seller Relationships, Journal of Marketing, 61, 35-51.

Dwyer, Fr., Schurr, Ph. and Oh, S. (1987). Developing Buyer-Seller Relationships, Journal of Marketing, 51, 11-27.

Dyer, J. (1997). Effective interfirm collaboration. how firms minimize transaction cost and maximize transaction value@, Strategic Management Journal, 18, 535-556.

Dyer, J.H. and Singh, H. (1998). The relational View: Cooperative Strategy and Sources of Interorganizational Competitive Advantage, Academy of Management Review, 23(4),660-679.

Ellram, L.M., Tate, W. L., Billington, C. (2008). Offshore outsourcing of professional services: A transaction cost economics perspective. Journal of Operations Management 26, 148-163.

Elmuti, D. (2003). The perceived impact of outsourcing on organizational performance. American Journal of Business, 18 (2), 33-42.

Erramilli, M. and Rao, C. (1993). Services firms international entry mode choice: A modified transaction-cost analysis approach, Journal of Marketing, 57(3), pp.19-38.

Fam, K.S., Foscht, T. and Collins, R.D. (2004). Trust and the Online Relationship – An Exploratory Study From New Zealand, Tourism Management, 25,195-207.

Ganesan, S. (1994). Determinants of long-term orientation in buyer-seller relationships, Journal of Marketing, 58 1-19.

Greaver II, M. F. (1999). Strategic outsourcing. A Structured Approach to Outsourcing Decisions and Initiatives. Amacon. New York.

Grönroos, C. (1994). Marketing y gestión de servicios. Díaz de Santos, Madrid.

Hamilton, R. H. (1997). Outsourcing of information systems as strategic decision: An empirical analysis of the banking industry. Thesis published by UMI.

Joskow, P. L. (1988). Asset specificity and the structure of vertical relationships: Empirical Evidence, Journal of Law, Economics and Organization, 4, 95-117.

Kasavana, M. L. and Brooks, R. M. (1995). Managing front office operations. The

educacional Institute of the American Hotel& Motel Association.

Kim, Woo Gon. and Cha, Youngmi. (2002). Antecedents and consequences of relationship quality in hotel industry, International Journal of Hospitality Management, 21, 321-338.

Klein, B., Crawford, R. and Alchian, A. (1978). Vertical integration, appropiate rents and the competitive contracting process, Journal of Law and Economics, 21, 297-326.

Kotabe, M., Mol, M.J. (2009). Outsourcing and financial performance: A negative curvilinear effect. Journal of Purchasing & Supply Management, 15 (4), 205-213.

Lacity , M. and Hirschheim, R. (1993). “The information sytems outosurcing badwagon”, Sloan Management Review, 35, 73-86.

Lamminmaki, D. (2007). Outsourcing in Australian Hotels: A transaction cost economics perspective. Journal of Hospitality & Tourism Research, 31 (1) 73-110.

Linder, J.C. (2004). Transformational outsourcing. Sloan Management Review, 45 (2), 52-58.

Loh, L. and Venkatraman, N. (1992). Determinants of information technology outsourcing: A cross sectional analysis, Journal of Management Information Systems, 9(1),7-24.

Lyons, B. (1995). Specific investment, economies of scale, and the make-or-buy decision: A test of transaction cost theory, Journal of Economic Behavior and Organization, 26, 431-443.

Malone, T. W.; Yates J. and Benjamin, R. (1987), “Electronic markets and electronic hierachies”, Communications of the ACM, 30(7), 484-497.

Martín Rojo, Inmaculada (2000). Dirección y gestión de empresas del sector turístico. Ediciones Pirámide.

Masten, S. (1984). The organization of production: Evidence from the aerospace industry, Journal of Law and Economics, 27, 403-418.

McIvor, R. (2008). What is the right outsourcing strategy for your process?. European Management Journal, 26, 24-34.

Monteverde, K. and Teece D. J. (1982). Supplier Swiching cost and vertical Integración in the automobile Industry, Bell Journal of Economics, 12, 206-213.

Morgan, R.M. and Hunt, S.D. (1994). The Commitment-trust Theory of Relationship Marketing, Journal of Marketing, 58, 20-38.

Murray J. Y., Kotabe, M. and Wildt, A. R. (1995). Strategic and financial implications of global sourcing strategy: A contingency analysis, Journal of International Business Studies, 181-202.

Nicholson, B., Jones, J., Espenlaub, S. (2006). Transaction costs and control of outsourced accounting: Case evidence from India. Management Accounting Research, 17, 238-258.

O´Connor, P. and Frew, A. J. (2004). An evaluation methodology for hotel electronic channels of distribution, International journal of hospitality Management, 23, 179-199.

Oliver, R.L. (1981). Measurement and evaluation of satisfaction processes in retail settings, Journal of Retailing, 57, 25-48.

Oraá, J. (1994). El outsourcing, alternativa a una organización simplificada, Dirección y progreso, 136, 57-71.

Paraskevas, A. and Buhalis, D. (2000). Outsourcing IT form small Hotels. The opportunities and Challenges of using Application Service Providers, Cornell Hotel and Restaurant Administration Quartely, 43, 27-39.

Parasuraman, A., Zeithaml, V. and Berry, L.L. (1988). SERVQUAL: A Multiple-Item Scale for Measuring Consumer Perceptions of Service Quality, Journal of Retailing, 64 (1),12-40.

Parasuraman, A., Zeithaml, V. and Berry, L.L. (1994). Alternative Scales for Mesauring Service Quality: A Comparative Assessment Based on Psychometric and Diagnostic Criteria, Journal of Retailing, 70(3), 201-230.

Patry, M., Tremblay, M., Lanoie, P. and Lacombe, M. (1999). Why firms outsource their human resources activities: an empirical analysis. ScientificSerieCirano.http://www.cirano. unmontreal.ca/ publications documents. html.

Poppo, L. and Zenger, T. (1998). Testing alternative theories of the firm: transaction cost, knowledge-based, and measurement explanations for make-or-buy decisions in infomation services, Strategic management Journal, 19, 853-877.

Quality, en Rust, R.T. y Oliver, R.L (eds.), Service Quality: New Directions in Theory and Practice, Sage Publications, Londres.

Quinn J. B. (1999). Strategic outsourcing: leveraging knowledge capabilities, Sloan Management Review, 40, 9-21.

Quinn, J. B. and Hilmer, F. G. (1994). Strategic Outsourcing, Sloan Management Review, (summer), pp.43-55.

Rothery, B. and Robertson, I. (1996). Outsourcing, Editorial Limusa. México.

Salimath, M. S., Cullen, J. B., Umesh, U.N. (2008). Outsourcing and Performance in Entrepreneurial Firms: Contingent Relationships with Entrepreneurial Configurations. Decision Sciences, 39 (3), 359-381.

Tayauova, G. (2012). Advantages and disadvantages of outsourcing: analysis of outsourcing practices of Kazakhstan banks. Procedia-Social and Behavioral Sciences, 41, 188-195.

Teng, J., Cheon, M. and Grover, V. (1995). Decisions to ousource information systems funtions: Testing a strategy-theoric-discrepancy mode, Decision Sciences, 26(1),75-103.

Vinnig, A. and Globerman, S. (1999). “A conceptual Framework for Undertanding the Outsourcing Decision”, European Management Journal, 17(6),645-654.

Webster, F.E. (1992). The Changing Role of Marketing in the Corporation, Journal of Marketing, 56, 1-17.

Westbrook, R.A. (1981). Sources of Consumer Satisfaction with Retail Outlets, Journal of Retailing, 57(3),72-80.

Williamson, O. E. (1975). Markets & Hierarquies: analysis & antitrust implications. A study in the Economics of organization. The Free Press, New York.

Williamson, O. E. (1979). Transaction cost economics: the governance of the contractual relations, Journal of Law and Economics, 22 (2), pp. 233-261.

Williamson, O. E. (1986). Economic organizations: Firms, markets and policy control. Wheatsheaf Books.

Williamson, O. E. (1985). The economic Institutions of capitalism: The Free Press, New York. [Traducido en Williamson, (1989). Las instituciones económicas del capitalismo. Fondo de cultura Económica, México].

Zajac, E. and Olsen, C. (1993). “From transaction cost to transactional value analysis: Implications for the study of interorganizational strategies”, Journal of Management, 30(1),131-145.






Copyright (c) 2017 Tourism & Management Studies

Creative Commons License
This work is licensed under a Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.