The Sequential Relationships among Operational Capabilities and Performance in Service Industry : An Empirical Study

Abstract

This study seeks to identify the elements of operational capability and obtain a detailed picture of the sequential relationships among operational capabilities and business performance in the hospitality industry. In addition, it attempts to prove that the capability to offer an enhanced customer experience constitutes a core competitive advantage in service firms. A phone survey was conducted among Korean hotels, and 102 data sets were collected. Structural equation modeling and multiple regressions were used to test hypotheses using the survey data. As a result, it was discovered an optimum path for the accumulation of operational capabilities in the hospitality industry and customer experience is revealed to be the only dimension of operational capabilities that is directly linked to market performance.