Activity outsourcing and competitive strategy in the hotel industry. The moderator role of asset specificity

• Published in: International journal of hospitality management 2014-09, Vol.42, p.9-19
• Main Authors: Espino-Rodríguez, Tomás F., Lai, Pei Chun
• Format: Article
• Language: English
• Subjects: Asset specificity; Competitive strategy; Cost leadership; Differentiation; Outsourcing
• ISSN: 0278-4319; 1873-4693
• DOI: 10.1016/j.ijhm.2014.06.005

•The cost leadership strategy positively influences the outsourcing of an activity.•The differentiation strategy has a negative effect on a hotel activity.•The asset specificity positively moderates the relationship between outsourcing the activity and the competitive strategy.•We identified three groups of activities and constructed a specificity outsourcing matrix using the two variables.•Not all the activities are found on the diagonal of the specificity-outsourcing matrix. This paper analyzes hotel outsourcing from the perspective of the competitive strategy and asset specificity. A comprehensive model is developed to establish the relationships among the competitive strategy (cost leadership and differentiation strategies), asset specificity and activity outsourcing. Asset specificity is used as a moderator variable in the relationship between the competitive strategy and activity outsourcing. A specificity-outsourcing matrix is developed to classify the activities by their level of asset specificity and outsourcing. The main hotel activities are investigated in a representative sample of hotels in Taiwan. The findings indicate that the cost leadership strategy positively and partially influences outsourcing, while the differentiation strategy has a negative impact on outsourcing an activity. The results confirm the negative relationship between asset specificity and the level of activity outsourcing. Moreover, they show that asset specificity positively moderates the relationship between the competitive strategy and outsourcing.