Outsourcing from the Perspectives of Competitive Capabilities and Supplier Innovation in the Hotel Sector

Abstract

This study aims to identify the outsourcing levels of the main activities or processes carried out in a hotel and the main benefits perceived by hotel managers. It proposes a model that explores the impact of supplier innovation on the perceived benefits of outsourcing, the relationship between supplier innovation and outsourcing, and competitive capabilities related to cost, quality, flexibility, and delivery.  A personal questionnaire was designed for the directors and managers of 114 hotels located in Egypt to achieve this objective. A structural model has been developed to test the hypotheses. The findings indicate that supplier innovation positively influences the perceived benefits of outsourcing. They also show that supplier innovation positively influences competitive capabilities related to quality, flexibility, and delivery. In contrast, outsourcing alone only influences the competitive capability related to cost, with no impact on other competitive capabilities. From a practical point of view, the study identified which activities are outsourced more often and which are not, as well as the main benefits of outsourcing perceived by managers. These results help managers determine which activities are outsourced in the hotel sector and how their hotel is positioned in outsourcing. This paper presents the first empirical study to analyse the relationship between supplier innovation's impact and outsourcing benefits. It is also the first empirical research to consider the relationship between outsourcing and supplier innovation and competitive capabilities.