Dynamics of networking, knowledge and performance of small and medium-sized tourism enterprises (SMTEs) in Terengganu, Malaysia
Small and medium-sized tourism enterprises (SMTEs) are a fundamental component in a tourism destination's development as they are the economic engines of the tourism sector. However, the entrepreneurs running these businesses face the challenge of scale, which leads to the lack of sufficient re...
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| Format: | Thesis Book |
| Language: | English |
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| Summary: | Small and medium-sized tourism enterprises (SMTEs) are a fundamental component in a tourism destination's development as they are the economic engines of the tourism sector. However, the entrepreneurs running these businesses face the challenge of scale, which leads to the lack of sufficient resources and knowledge in dealing with the competitive and complex tourism business environment. Networks may be crucial for SMTEs as there is empirical evidence from other industries that enterprises have benefited from their use. Therefore, it is the aim of this thesis to advance knowledge on the characteristics of the entrepreneurs and their SMTEs, as well as to explore the underlying benefits of absorptive capacity derived from the tourism networks for the business performance in the cultural context of Terengganu, Malaysia. A sequential mixed¬methods approach was adopted, employing firstly face-ta-face questionnaires and then semi-structured interviews. This thesis is considered innovative as it involved four different tourism sub-sectors (hotels and resorts, travel agencies, restaurants and handicrafts), which enables a detailed inter-sectoral comparison in researching the variables of interest. Few if any studies have taken such a detailed comparative approach within tourism studies. A descriptive analysis of the survey data suggests that the distribution of gender is fairly balanced and distinctiveness of the characteristics of entrepreneurs and SMTEs from the inter-sectoral perspective can be observed in 8 dimensions, namely: (1) level of education, (2) years of working experience inside the tourism sector, (3) years of previous working experience, (4) business training and (5) specific training in tourism, (6) years of business operations, (7) existence of a business plan and (8) annual sales turnover. A qualitative analysis shows that the motivations for the majority of entrepreneurs are based on financial rewards. Employment practices in terms of hiring family members or not differ somewhat between enterprises and sub-sectors. With these characteristics, the descriptive analysis indicates that entrepreneurs are more inclined towards accessing informal networks - in terms of the scale of the contacts, strength of the relationship and trust and frequency of communication - as compared to the formal networks. Inferential analysis revealed that 7 dimensions of characteristics of entrepreneurs have statistically significant relationships with the importance of formal networks in SMTEs' learning, notably: (1) formal tourism training, (2) the business plan, (3) years of working in tourism sector, (4) years living in Terengganu, (5) age, (6) capital sources from personal savings and (7) capital from families. This contrasts with the determinants of the importance of informal networks in SMTEs' learning, where only years of previous working experience was found to be statistically significant. Building on this, hierarchical regression analyses show that absorptive capacity strongly mediates the relationship between the use of formal networks and one of the dimensions of business performance, which is the business management. Within the relationship between the use of formal networks, absorptive capacity and business management, trust and transformation are the two crucial dynamics that contributed to the significant result. Use of formal networks also appears to have a statistically significant relationship with the annual sales turnover. In this relationship, trust also plays an important role and this is followed by size of the contacts and frequency of communication. For the use of informal networks, no significant relationships are found. These differences can also be seen in the qualitative interviews. The differences of the both networks lie in their breadth, significance and consistency as the offer of formal networks is considered advantageous compared to informal networks. There are also qualitative differences across the four different sub-sectors in their appreciation of the importance and offer of formal and informal networks. Entrepreneurs are found to be informal when they communicate with others at the individual level, while at the organisational level, the nature of the communications can be both formal and informal within the settings of business and community events. Overall, this research makes important theoretical contributions to the tourism body of knowledge with the development of a conceptual framework based on the systematic review of the literature that primarily highlights the interlinkages between the characteristics of entrepreneurs and SMTEs, use of formal and informal networks, absorptive capacity, business management and annual sales turnover. Drawing on statistical modelling and qualitative analysis conducted on the four different tourism sub-sectors, a final integrated model is produced. The model is the first of its kind to be based on empirical evidence on the interlinkages between the different variables investigated. It provides a strong platform for further work on networks in Malaysia and beyond. Keywords: Characteristics of entrepreneurs, SMTEs, formal networks, informal networks, absorptive capacity, business performance, business management, annual sales turnover |
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| Physical Description: | xxi, 457 leaves; 30 cm. |
| Bibliography: | Includes bibliographical references (leaves 338-368) |