Non-financial factors affecting the operational performance of hospitality companies: Evidence from Vietnam

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Non-financial factors including quality of services, the flexibility of a company, utilization of resources, and market orientation are regarded as significant determinants that enhance the profitability-based performance of a service company or a hotel. The study investigated the interaction between these factors and hotel operating performance measured by the hospitality performance and results indicators. Data on 346 executives of Vietnam’s hospitality companies were collected. A structural equation modeling (SEM) method was utilized to examine the positive-direct and moderating effects of non-financial factors on hotel performance in terms of occupancy rate (OCR), average daily rate (ADR), and the revenue per available room (RevPAR). The findings showed that service quality ( = 0.118, p < 0.05), flexibility ( = 0.173, p < 0.05) and resource utilization (= 0.172, p < 0.05) positively affected the performance of Vietnam’s hospitality companies. Meanwhile, innovation showed no direct influence (p = 0.068) but an indirect impact on the performance through service quality ( = 0.311, p < 0.05). Market orientation did not impact the performance (p = 0.076) but it positively affected both innovation ( = 0.322, p < 0.05) and service quality ( = 0.146, p < 0.05). The study contributed to a theoretical enhancement of the current level of knowledge on the factors that affect the performance and developed a reliable scale for measuring the performance of hotels in Vietnam.

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    • Figure 1. Theoretical framework
    • Figure 2. Results of confirmatory factor analysis
    • Figure 3. Results of the SEM model
    • Table 1. Explanation of variables and respective measures in the model
    • Table 2. Total variance explained
    • Table 3. Composite reliability (CR) and average variance extracted (AVE)
    • Table 4. Factor correlations
    • Table 5. Results of hypothesis testing
    • Conceptualization
      Trung Kien Phan, Thu Ha Dang
    • Data curation
      Trung Kien Phan, Thi Hong Thuy Nguyen, Thu Ha Dang, Van Thuan Tran, Kim Ngoc Le
    • Formal Analysis
      Trung Kien Phan, Thi Hong Thuy Nguyen, Thu Ha Dang, Van Thuan Tran, Kim Ngoc Le
    • Investigation
      Trung Kien Phan, Thi Hong Thuy Nguyen, Thu Ha Dang, Van Thuan Tran, Kim Ngoc Le
    • Methodology
      Trung Kien Phan, Thi Hong Thuy Nguyen, Thu Ha Dang
    • Validation
      Trung Kien Phan, Thi Hong Thuy Nguyen, Thu Ha Dang, Van Thuan Tran
    • Visualization
      Trung Kien Phan, Thi Hong Thuy Nguyen, Thu Ha Dang, Kim Ngoc Le
    • Writing – original draft
      Trung Kien Phan, Thu Ha Dang
    • Writing – review & editing
      Trung Kien Phan, Thi Hong Thuy Nguyen