Relationship between Quality and Performance: Tourism Companies in the Czech Republic

• Authors: Milan Sedláček , Petr Suchánek , Jiří Špalek , Petra Štamfestová
• Languages of publication: EN

Abstracts

EN

This article analyzes perception of quality as a factor of performance of companies operating in the tourism industry. The introduction defines business performance and quality with a focus on tourism companies. A synthesis of findings from empirical studies conducted abroad follows, and is focused on the determinants of performance of a company (success), including the quality management which emerged as one of the important factors, and so these findings justify the importance of quality management in business practice. The aim of this article is to find the perception of quality and emphasis on the quality management of tourism companies in the Czech Republic. To identify the specific characteristics of quality perception and management in this sector, comparative analysis of questionnaire results, and results of a financial analysis of companies from various sectors of the Czech economy, with emphasis on tourism, has been used. It has been proved that enterprises in the sectors surveyed perceive quality as the key factor in business performance; it was also empirically shown that companies with higher levels of service quality reach better values of financial indicators. Also it was found that although tourism companies perceive the service quality of as one of the key success factors, the level of its actual implementing is low. This is related to the fact that relatively good financial results can be achieved in this industry without adjustment of the maximum customer service. This fact is also confirmed by the findings that show that in comparison to companies in other sectors, tourism companies still perceive relationship between quality production and business performance as substandard.

Keywords

EN

competitiveness; quality; financial analysis

• Publisher: Sciendo
• Journal: Review of Economic Perspectives
• Year: 2011
• Volume: 11
• Issue: 4
• Pages: 195-222

Dates

published

2011-01-01

online

2012-01-13

Contributors

author

Milan Sedláček

• Faculty of Economics and Administration, Masaryk University, Lipová 41a, 602 00 Brno, Czech Republic

author

Petr Suchánek

• Faculty of Economics and Administration, Masaryk University, Lipová 41a, 602 00 Brno, Czech Republic

author

Jiří Špalek

• Faculty of Economics and Administration, Masaryk University, Lipová 41a, 602 00 Brno, Czech Republic

author

Petra Štamfestová

• Faculty of Economics and Administration, Masaryk University, Lipová 41a, 602 00 Brno, Czech Republic

References

• Accounts Commission for Scotland. Can't get no satisfaction? Using a Gap Approach to Measure Service Quality. 1999. Retrieved from:
• ADAM, E. E. (1994). Alternative quality improvement practices and organizational performance. Journal of Operations Management. Vol. 12, No. 1, pp. 27-44.[Crossref]
• ALEN GONZALEZ M. E., FRAIZ BREA J. A. (2006). Evaluacion de la relacion existente entre la calidad de servicio, la satisfaccion y las intenciones de comportamiento en el ambito del turismo termal. Revista Europea de Direccion y Economıa de la Espresa. Vol. 15, No. 3, pp. 171-184.
• BACKMAN, S. J., VELDKAMP, C. (1995). Examination of the Relationship between service quality and user loyalty. Journal of Park and Recreation Administration. Vol. 13, No. 2, pp. 29-41.
• BADE, F. J. (1986). The Economic Importance of Small Business and Medium Firms in the Federal Republic of Germany, New Firms and Regional Development in Europe, London: Croom Helm, pp. 256-274.
• BARNEY, J. (1991). Firm Resource and Sustained Competitive Advantage, Journal of Management. Vol. 17, No.1, pp. 99-120.[Crossref]
• BEI, L. T., CHIAO Y. C. (2001). An integrated model for the effects of perceived product, perceived service quality and perceived price fairness on consumer satisfaction and loyalty. Journal of Consumer Satisfaction, Dissatisfactiona and Complaining Behaviour. Vol. 14, pp. 125-140.
• BIRLEY, S.; WESTHEAD, P. (1990). Growth and Performance Contrasts between Types of Small Firms, Strategic Management Journal. Vol. 11, No. 7, pp. 535-557.[Crossref]
• BITNER, M., BOOMS, B., TETREAULT, M. (1990). The Service Encounter: Diagnosing Favorable and Unfavorable Incidents. Journal of Marketing. Vol. 54, pp. 71-84.[Crossref]
• BLAŽEK, L. et al. (2009). Konkurenční schopnost podniků. Analýza faktorů hospodářské úspěšnosti. Druhá etapa. Brno: Masarykova univerzita. 1. vyd. ISBN 978-80-210-5058-7.
• BOWEN, D. (2002). Research through participant observation in tourism: A creative solution to the measurement of consumer satisfaction/dissatisfaction (CS/D) among tourists. Journal of Travel Research. Vol. 41, No. 1, p. 4.
• BRADY, M. K., CRONIN, J. J. (2001). Some new thoughts on conceptualizing perceived service quality: a hierarchical approach, Journal of Marketing. Vol. 65, pp. 34-49.[Crossref]
• CARO, L. M., GARCIA, J. A. M. (2008). Developing a multidimensional and hierarchical service quality model for the travel agency industry. Tourism Management. Vol. 29, Iss. 4, pp. 706-720.[Crossref]
• CROMPTON, J. L., LOVE, L. L. (1995). The predictive validity of alternative approaches of evaluating quality of a festival. Journal of Travel Research. Vol. 34, pp. 11-24.
• CROMPTON, J. L., MACKAY, K. J., FESENMAIER, D. R. (1991). Identifying dimensions of service quality in public recreation. Journal of Park and Recreation Administration. Vol. 9, Iss. 3, pp. 15-27.
• CRONIN, J. J., TAYLOR, S. A. (1996). Measuring service quality: a reexamination and extension. Journal of Marketing. Vol. 56, pp. 55-68.
• CROSBY, P. B. (1979). Quality is free: The art of making quality certain. McGraw Hill Custom Publishing: New York, 309 p. ISBN 0070145121.
• ČSN EN ISO 9001 ed. 2, 2010.
• DAVIDSON, P. (1991). Continued Entrepreneurship: Ability, Need and Opportunity as Determinants of Small Firm Growth, Journal of Business Venturing. Vol. 6, pp. 405-429.[Crossref]
• DENISON, D. R., ALEXANDER, J. M. (1986). Patterns and Profiles of Entrepreneurs: Data from entrepreneurship Forums. Frontiers of Entrepreneurship Research, Babson College. pp. 578-593.
• DOLLINGER, M. J. (1985). Environmental Contacts and Financial Performance of the Small Firm. Journal of Small Management. Vol. 23, No. 1, pp. 24-30
• DOUGLAS, T. J., JUDGE, W. Q. (2001). Total quality management implementation and competitive advantage: the role of structural control and exploration. Academy of Management Journal. Vol. 44, No. 1, pp. 158-169.[Crossref]
• DUCHESNEAU, D. A.; GARTNER, W. B. (1990). A Profile of New Venture Succes and Failure in an Emerging Industry. Journal of Business Venturing. Vol. 5, pp. 297-312.[Crossref]
• EASTON, G. S., JARRELL, S. L. (1998). The effects of total quality management on corporate performance: an empirical investigation. Journal of Business. Vol. 71, No. 2, pp. 253-307.[Crossref]
• FROST, B. (1999). Performance metrics: The new strategic discipline. Strategy and Leadership. ABI/INFORM Global. Vol. 27, No 3, p. 34.
• FUENTES-FUENTES, M. M., ALBACETE-SÁEZ, C. A., LLORÉNS-MONTES, F. J. (2004). The impact of environmental characteristics on TQM principles and organizational performance. Omega. Vol. 32 No. 6, pp. 425-442.
• GARVIN, D. A. (1984). What does product quality really mean? Sloan Management Review. Vol. 26, No.1., pp. 25-43.
• GARVIN, D. A. (1987). Competing on the eight dimensions of quality. Harvard Business Review. Vol. 65, No. 6, pp. 101-109.
• GARVIN, D. A. (1991). How the Baldrige Award Really Works. Harvard Business Review. Vol. 69, No 6, pp. 80-94.
• GRÖNROOS, C. (1984). A service quality model and its marketing implications. European Journal of Marketing. Vol. 18, No. 4, pp. 36-44.[Crossref]
• HABER, S., REICHEL, A. (2005). Identifying Performance Measures of Small Ventures - The Case of the Tourism Industry. Journal of Small Business Management, Vol. 43, No. 3, pp. 257-286.[Crossref]
• HACKMAN, J., WAGEMAN, R. (1995). Total quality management: empirical, conceptual and practical issues. Administrative Science Quarterly, Vol. 40, pp. 309-42.[Crossref]
• HALL, W. K. (1980). Survival Strategies in a Hostile Environment. Harvard Business Review. Vol. 58, pp.75-85.
• HARARI, O. (1993). Ten reasons why TQM doesn't work. Management Review. Vol 82, No. 1, ABI/INFORM Global, pg. 33.
• HENDRICKS, K. B., SINGHAL, V. R. (1997). Does Implementing an Effective TQM Program Actually Improve Operating Performance? Empirical Evidence from Firms that have Won Quality Awards. Management Science. Vol. 43, Iss. 9, pp. 1258-1274.[Crossref]
• HERNÁNDEZ-MAESTRO, R. M., MUÑOZ-GALLEGO, P. A., SANTOS-REQUEJO, L. (2009). Small Business OwnersKnowledge and Rural Tourism Establishment Performance in Spain. Journal of travel resech. Vol. 48, No. 1, pp. 58-77. DOI: 10.1177/0047287508328794.[Crossref]
• HOWAT, G., ABSHER, J., CRILLEY, J., MILNE, I. (1996). Measuring customer service quality in sports and leisure centres. Managing Lemure. Vol. 1, No. 1, pp. 77-89.
• CHAPMAN, R. L., MURRAY, P. C., MELLOR, R (1997). Strategic quality management and financial performance indicators. International Journal of Quality and Reliability Management. Vol. 14, No. 4, pp. 432-448.
• CHONG, V. K., RUNDUS, M. J. (2004). Total quality management, market competition and organizational performance. The British Accounting Review, Vol. 36, No. 2, pp. 155-172. DOI: 10.1016/j.bar.2003.10.006.[Crossref]
• JOHANNISSON, B (1993). Designing supportive contexts for emerging enterprises, Small Business Dynamics: International, National and Regional Perspectives London: Routledge.
• JOHNSON, M. D., GUSTAFSSON, A., ANDREASSEN, T. W., LERVIK, L., CHA., J. (2000). The evaluation and future of national customer satisfaction index models. Journal of Economic Psychology. Vol. 22, No. 2, pp. 217-245.
• KALLEBERG, A. L.; LEICHT, K. T. (1991). Gender and Organzational Performance: Determinants of Small Business Survival and Succes, Academy of Management Journal. Vol. 34, No 1, pp. 136-161.[Crossref]
• KANG, G. D. (2006). The hierarchical structure of service quality: integration of technical and functional quality. Managing Service Quality. Vol. 16, No. 1, pp. 37-50. DOI: 10.1108/09604520610639955[Crossref]
• KANG, G. D., JAMES, J., ALEXANDRIS K. (2002). Measurement of internal service quality: application of the Servqual battery to internal service quality. Managing Service Quality. Vol. 12, No. 5, pp. 278-291. DOI: 10.1108/09604520210442065[Crossref]
• KEAN, R, GASKILL, L.; LEISTRITZ, L., JASPER, C., BASTOW-SHOOP, H., JOLLY, L., STERNQUIST, B. (1998). Effects of Community Characteristics, Business Environment and Competitive Strategies on Rural Retail Business Performance, Journal of Small Business Management. Vol. 36, No. 2, p. 45-57.
• KIECHEL, W. (1981): Three (or Four, or More) Ways to Win. Fortune. Vol. 104, pp. 181-184.
• LAI, K (2003). Market orientation in quality-oriented organizations and its impact on their performance. International Journal of Production Economics. Vol. 84., Iss. 1, pp. 17-34. DOI: 10.1016/S0925-5273(02)00382-1[Crossref]
• LARSEN, M. A. (2003). TQM and Organizational Performance Improvement. International Journal of Production Economics. Vol. 84, pp. 17-34.
• LEMAK, D. J., REED, R., SATISH, P. K. (1997). Commitment to total quality management: Is there a relationship with firm performance? Journal of Quality Management. Vol. 2, Iss. 1, pp. 67-86.
• LERNER, M., HABER, S. (2001). Performance Factors of Small Tourism Ventures: The Interface of Tourism, Entrepreneurship and the Environment, Journal of Business Venturing. Vol. 16, pp. 77-100. DOI: 10.1016/S0883-9026(99)00038-5.[Crossref]
• LEWIS, R. C., BOOMS, B. H. (1983). The marketing aspect of service quality. Emerging perspectives on services marketing. Chicago: American Marketing, pp. 99-107.
• LOSCOCCO, K. A.; LEICHT, K. T. (1993). Gender, Work-Family Linkages and Economic among Small Business Owners, Journal of Marriage and The Family. Vol. 5, pp. 875-887.
• LYNN W. P., CHANG D. R., BUZZELL, R. D. (1983). Product Quality, Cost Position and Business Performance: A Test of Some Key Hypotheses. The Journal of Marketing, Vol. 47, No. 2, pp. 26-43.
• MACKAY, K. J., CROMPTON, J. L. (1990). Measuring the quality of recreation services. Journal of Park and Recreation Administration. Vol. 8, No. 3, pp. 47-56.
• MADU, C. N., KUEI C. H., JACOB, R. A. (1996). An empirical assessment of the influence of quality dimensions on organizational performance. International Journal of Production Research. Vol. 34, No. 7, pp. 1943-1962.[Crossref]
• MAIGA, A. S., JACOBS, F. A. (2005). Antecedents and Consequences of Quality Performance. Behavioral Research in Accounting. Vol. 17, pp. 111-131.
• MAISTER, D. H. (2001). Practice what you preach: What managers must do to create a high achievement culture. The free press. New York. London. Toronto. Sydney. Singapure. ISBN. 0-7432-1592-3.
• MILLER, A., WILLSON B., ADAMS M. (1988). Financial Performance Patterns of New Corporate Ventures: An Alternative to Traditional Measures, Journal of Business Venturing. Vol. 3, No. 4, pp. 287-299.[Crossref]
• MOHR, J., SPEKMAN, R. (1994). Characteristics of Partnership Succes: Partnership Attributes, Communication Behavior and Conflict Resolution Techniques, Strategic Management Journal. Vol. 15, pp. 135-152.[Crossref]
• MORRISON, A., TEIXERA, R. (2004). Small business performance: a tourism sector focus. Journal of Small Business and Enterprise Development, Vol. 11 Iss: 2, pp.166-173, DOI: 10.1108/14626000410537100.[Crossref]
• MONROE, K. B., KRISHNAN, R. (1983). The effect of price on subjective product evaluations. Blackburg: Virginia polytechnic institute, working paper.
• NAMKUNG Y., JANG, S. (2008). Are highly satisfied restaurant customers really different? A quality perception perspective. International Journal of Contemporary Hospitality Management. Vol. 20, No. 2, pp. 142-155, DOI: 10.1108/09596110810852131.[Crossref]
• NILSSON L., JOHNSON, M. D., GUSTAFSSON, A. (2001). The impact of quality practices on customer satisfaction and business results: product versus services organizations. Journal of Quality Management, Vol. 6, No. 1, pp. 5-27.
• OFRREL, P. (1986). The Nature of New Firms in Ireland: Empirical Evidence and Policy Implications, New Firms and Regional Development in Europe, London: Croom Helm, pp. 151-183.
• Official pages iso.org. International organization for standardization, Retrieved June 1, 2010 from
• Official pages John stark associates. Retrieved June 1, 2010, from
• Official pages mpo.cz. Finanční analýzy podnikové sféry průmyslu a stavebnictví v příslušných letech, Retrieved June 1, 2010, from
• Official pages npj.cz. Informace o Národním systému kvality služeb v cestovním ruchu, Retrieved June 1, 2010, from
• Official pages unwto.org. Improving Competitiveness, Retrieved March 31, 2010, from
• ORSER, B. J., HOGARTH-SCOTT, S., RIDING, A. L. (2000). Performance, Firm Size and Management Problem Solving, Journal of Small Business Management. Vol. 38, No. 4, pp. 42-58.
• PARASURAMAN A., ZEITHAML V. A., BERRY L. L. (1988). SERVQUAL: a multiple item scale for measuring customer perceptions of service quality. Journal of Retailing. Vol. 64, No. 1, pp. 12-40.
• PARASURAMAN, A., ZEITHAML, V. (2006). Understanding and Improving Service Quality: A Literature Review and Research Agenda. In WEITZ, B., WENSLEY, R. (Ed.), Handbook of Marketing. London: Sage Publications.
• PARASURAMAN, A., ZEITHAML, V. A., BERRY, L. L. (1985). A conceptual model of service quality and its implications for future research. The Journal of Marketing. Vol. 49, No. 4, pp. 41-50.[Crossref]
• PARASURAMAN, A., ZEITHAML, V. A., BERRY, L. L. (1994). Reassessment of expectations as a comparison standard in measuring service quality: implications for further research. The Journal of Marketing. Vol. 58, No. 1, pp 111-124.[Crossref]
• RICHARD, O. C. (2000). Racial Diversity, Business Strategy and Firm Performance: A ressource Based View. Academy of Management Journal. Vol. 43, No. 2, pp. 164-177.[Crossref]
• ROBINSON, P. B., SEXTON, E. A. (1994). The Effect of Education and Experience of Self-Employment Succes, Journal of Business Venturing. Vol. 9, No. 2, pp. 141-156.[Crossref]
• SANTOS-VIJANDE, M. L, ALVAREZ-GONZALES, L. I. (2007). TQM and firms performance: An EFQM excellence model research based survey. International Journal of Business Science and Applied Management. Vol. 2, No. 2.
• SEXTON, E. A.; ROBINSON P. B. (1989). The Economic and Demographic Determinants of Self Employment, Frontiers of Entrepreneurship Research, Babson College, pp. 28-42.
• SHEA, C., HOWELL, J. (1998). Organizational antecedents to the successful implementation of total quality management. Journal of Quality Management. Vol. 3, pp. 3-24. DOI: 10.1016/S1084-8568(99)80101-1.[Crossref]
• SMITH, N. R., BRACKER, J. S., MINER, J. B. (1987). Correlates of Firms and Entrepreneur Succes in Technologically Innovative Companies. Frontiers of Entrepreneurship Research: Babson Collage Press, pp. 57-71.
• SRINAVASAN R., WOO, C. Y., COOPER, A. C. (1994). Performance Determinants for Men and Female Entrepreneurs, Frontiers of Entrepreneurship Research, Babson College.
• SUBEDI, D., MAHESHWARI, S. (2007). Impact of total quality management (TQM) on profitability and efficiency of Baldridge award winners. Delhi Business Review X, Vol. 8, No. 1.
• TAKEUCHI, H., QUELCH, J. A. (1983). Quality is more than making a good product. Harvard business review. Vol. 61, pp. 139-145.
• TAYLOR, S. A., BAKER, T. L. (1994). An assessment of the relationship between service quality and customer satisfaction in the formation of consumers' purchase intentions. Journal of retailing, Vol. 70, No. 2, 1994, pp. 163-178.
• TAYLOR, W. A., WRIGHT, G. H. (2003). A longitudinal study of TQM implementation: factors influencing success and silure. Omega, Vol. 31, pp. 97-111.
• TERZIOVSKI, M., SAMSON, D. (1999). The link between total quality management practice and organizational performance. International Journal of Quality and Reliability Management, Vol. 1, No. 3, pp. 226-237, DOI: 10.1108/02656719910223728.[Crossref]
• VAJČNEROVÁ, I., RYGLOVÁ, K. (2010). Approaches to the quality management in tourism services. Acta univ. agric. et silvic. Mendel. Brun. No. 6, pp. 607-612.
• WESTHEAD, P., WRIGHT, M. UCBASARAN, D. (2001). The Internationalization of New and Small Firms: A Resource-Based View, Journal of Business Venturing. Vol. 16, No. 4, pp. 333-358.[Crossref]
• WRUCK, K. H., JENSEN, M. C. (1994). Science, Specific Knowledge and Total Quality Management. Journal of Accounting and Economic. Vol. 18, No. 3, pp. 247-287.
• YORK, K. M., MIREE, C. E. (2004). Causation or covariation: an empirical reexamination of the link between TQM and financial performance. Journal of Operations Management. Vol. 22, pp. 291-311. DOI: 10.1016/j.jom.2004.02.001.[Crossref]
• ZEITHAML, V. A., PARASURAMAN, A., BERRY, L. (1990). Delivering Quality Service. New York: The Free Press.

Identifiers

DOI

10.2478/v10135-011-0013-z