THE ROLE OF FUNCTIONAL TOP MANAGEMENT TEAM IN INITIATING THE STRATEGIC ALLIANCES AS OUTCOME FROM INNOVATIVENESS BEHAVIOR: EMPIRICAL EVIDENCE FROM STAR HOTELS

Thomas Stefanus Kaihatu, Adrie Oktavio

Abstract


One way that is widely used by many organizations in general, including hotels to survive in a business competition climate is to encourage employees to have an entrepreneurial mindset and behavior in carrying out their respective functions. The mindset and behavior must, of course, be initiated and supported by the Top Management Team (TMT) including the Functional Top Management Team (FTMT) level. However, unfortunately, some FTMT members do not have the same mindset and behavior. FTMT is like the heart of an organization and functions as a predecessor from the birth of a business strategy such as strategic alliances. In the context of hotels, strategic alliances should ideally be born from innovative ideas that are not only the responsibility of FTMT. Thus, FTMT must also play a role to encourage the creation of innovation that is in line with the organization’s vision, mission, goals, and competencies. Improving the entrepreneurial orientation of the hotel, especially the innovativeness factor is an important step to initiate the application of statistic alliances which of course the strategy should come from the ideas of the FTMT. This study tries to analyze the role of FTMT and its influence on innovation and the application of business strategies in the form of strategic alliances. Data collected from 29 4 and 5 star hotels in Surabaya were analyzed using structural equation modeling to support the hypothesis of this research. The results of this study indicate that all three hypotheses can be accepted where FTMT influences innovativeness and strategic alliance. Innovativeness also has a direct influence on strategic alliances.

Keywords


Functional Top Management Team; Innovativeness; Strategic Alliances; Hotel Industry

Full Text:

PDF

References


Amabile, T. M. 1997. Motivating creativity in organizations: On doing what you love and loving what you do. California Management Review, (1), 39–58. https://doi.org/10.2307/41165921.

Angwin, D., Paroutis, S., and Mitson, S. 2009. Connecting up strategy: Are senior strategy directors a missing link?. California Management Review, 51 (3). https://doi.org/10.2307/41166494.

Antoncic, B. 2007. Intrapreneurship: A comparative structural equation modeling study. Industrial Management and Data Systems, 107 (3), 309–325. https://doi.org/10.1108/02635570710734244.

Bernardes, A., Cecilio, L. C. de O., Évora, Y. D. M., Gabriel, C. S., and de Carvalho, M. B. 2011. Collective and decentralized management model in public hospitals: Perspective of the nursing team. Revista LatinoAmericana de Enfermagem, 19(4), 1003–1010. https:/ /doi.org/10.1590/S0104-11692011000400020.

BPS Kota Surabaya. 2018. Statistik Daerah Kota Surabaya 2018. Surabaya. [On Line]. from: http:// dpm-ptsp.surabaya.go.id/v3/po-content/po-upload/pdrb-2010-2016/Statistik-Daerah-KotaSurabaya-2018-r.pdf.

Cannella, B., Finkelstein, S., and Hambrick, D. C. 2009. Strategic leadership: Theory and research on executives, top management teams, and boards. Strategic Leadership: Theory and Research on Executives, Top Management Teams, and Boards. https:/ / d o i . o r g / 1 0 . 1 0 9 3 / a c p r o f : o s o / 9780195162073.001.0001.

Carpenter, M. A., Geletkancz, M. A., and Sanders, W. G. 2004. Upper echelons research revisited: Antecedents, elements, and consequences of top management team composition. Journal of Management, 30 (6), 749–778. https://doi.org/10.1016/j.jm. 2004.06.001.

Èater, T. and Puèko, D. 2010. Factors of effective strategy implementation: Empirical evidence from Slovenian business practice. Journal of East European Management Studies, 15(3), 207–236. https:// doi.org/10.5771/0949-6181-2010-3-207.

Cloete, C. E. and Venter, I. 2013. A framework for successful hotel developments. South African Journal of Economic and Management Sciences, 10 (2), 223– 237. https://doi.org/10.4102/sajems.v10i2.584.

Dickson, P. H., Weaver, K. M., and Hoy, F. 2006. Opportunism in the RandD alliances of SMES: The roles of the institutional environment and SME size. Journal of Business Venturing, 21 (4), 487–513. https:// doi.org/10.1016/j.jbusvent.2005.02.003.

Drummond, I. and Stone, I. 2007. Exploring the potential of high performance work systems in SMEs. Employee Relations, 29 (2), 192–207. https://doi.org/ 10.1108/01425450710720011.

Figueiredo, P., Silveira, G., and Sbragia, R. 2008. Risk sharing partnerships with suppliers: The case of Embraer. Journal of Technology Management and Innovation, 3 (1), 27–37.

Fornell, C. and Larcker, D. F. 1981. Evaluating structural equation models with unobservable variables and measurement error. Journal of Marketing Research, 18 (1), 39. https://doi.org/10.2307/3151312.

Franco, M. and Haase, H. 2013. Firm resources and entrepreneurial orientation as determinants for collaborative entrepreneurship. Management Decision, 51 (3), 680–696. https://doi.org/10.1108/ 00251741311309724.

Garette, B. and Dussauge, P. 2000. Alliances versus acquisitions: Choosing the right option. European Management Journal, 18 (1), 63–69. https://doi.org/ 10.1016/S0263-2373(99)00069-9.

Gatignon, H., Tushman, M. L., Smith, W., and Anderson, P. 2002. A structural approach to assessing innovation: Construct development of innovation locus, type, and characteristics. Management Science, 48 (9), 1103–1122. https://doi.org/10.1287/mnsc. 48.9.1103.174.

Geiger, M. A. and North, D. S. 2006. Does hiring a new CFO change things?. An investigation of changes in discretionary accruals. Accounting Review, 81 (4), 781–809. https://doi.org/10.2308/accr.2006. 81.4.781.

González-Rodríguez, M. R., Jiménez-Caballero, J. L., Martín-Samper, R. C., Köseoglu, M. A., and Okumus, F. 2018. Revisiting the link between business strategy and performance: Evidence from hotels. International Journal of Hospitality Management, 72, 21– 31. https://doi.org/10.1016/j.ijhm.2017.11.008.

Hambrick, D. C. and Finkelstein, S. 1987. Managerial discretion: A bridge between polar views of organizational outcomes. Research in Organizational Behavior, 9, 369–406.

Hambrick, D. C. and Mason, P. A. 1984. Upper echelons: The organization as a reflection of its top managers. Academy of Management Review, 9 (2), 193– 206. https://doi.org/10.5465/amr.1984.4277628.

Hashimoto, M. and Nassif, V. M. J. 2014. Inhibition and encouragement of entrepreneurial behavior: Antecedents analysis from managers’ perspectives. BAR - Brazilian Administration Review, 11 (4), 385– 406. https://doi.org/10.1590/1807-7692bar 2014130008.

Hitt, M. A., Ireland, R. D., Camp, S. M., and Sexton, D. L. 2001. Strategic entrepreneurship: entrepreneurial strategies for wealth creation. Strategic Management Journal, 22 (6–7), 479–491. https://doi.org/ 10.1002/smj.196.

Hwang, H. and Takane, Y. 2014. Generalized structured component analysis: A component-based approach to structural equation modeling. Generalized Structured Component Analysis: A Component-Based Approach to Structural Equation Modeling (1st ed.. Florida: CRC Press).

Hwang, H., Takane, Y., and Jung, K. 2017. Generalized structured component analysis with uniqueness terms for accommodating measurement error. Frontiers in Psychology, 8 (DEC. https://doi.org/10.3389/ fpsyg.2017.02137.

Isoraite, M. 2009. Importance of strategic alliances in company’s activity. Intellectual Economics, 1 (5), 39– 46. https://doi.org/ISSN 1822-8011.

Kaplan, R. S. and Norton, D. P. 2005. The office of strategy management. Harvard Business Review, 83 (10).

Keskin, H. 2006. Market orientation, learning orientation, and innovation capabilities in SMEs: An extended model. European Journal of Innovation Management, 9(4), 396–417. https://doi.org/10.1108/ 14601060610707849.

Killing, J. P. 1995. Strategic alliances: An entrepreneurial approach to globalization. Journal of International Business Studies, 26 (2), 436–439. https:// doi.org/10.1057/jibs.1995.26.

Kuznetsova, N. V. 2016. Strategic alliances: Industryspecific characteristics of the achievement of a competitive advantage. International Journal of Economics and Financial Issues, 6 (1), 109–117.

Laursen, K. and Salter, A. 2006. Open for innovation: The role of openness in explaining innovation performance among U.K. manufacturing firms. Strategic Management Journal, 27 (2), 131–150. https:// doi.org/10.1002/smj.507.

Linton, G. and Kask, J. 2017. Configurations of entrepreneurial orientation and competitive strategy for high performance. Journal of Business Research, 70, 168–176. https://doi.org/10.1016/j.jbusres. 2016.08.022.

Lumpkin, G. T. and Dess, G. G. 1996. Clarifying the entrepreneurial orientation construct and linking it to performance. Academy of Management Review, 21 (1), 135–172. https://doi.org/10.5465/AMR.1996. 9602161568.

Marcel, J. J. 2009. Why top management team characteristics matter when employing a chief operating officer: A strategic contingency perspective. Strategic Management Journal, 30(6), 647–658. https:// doi.org/10.1002/smj.763.

Menz, M. 2012. Functional top management team members: A review, synthesis, and research agenda. Journal of Management, 38 (1), 45–80. https://doi.org/ 10.1177/0149206311421830.

Miller, D. and Friesen, P. H. 1983. Innovation in conservative and entrepreneurial firms: Two models of strategic momentum. Strategic Management Journal, 3 (1), 1–25. https://doi.org/10.1002/smj. 4250030102.

Mockler, R. J. 1997. Multinational strategic alliances: A manager’s perspective. Strategic Change, 6 (7), 391– 405. https://doi.org/10.1002/(sici)1099- 1697199711)6:7<391::aid-jsc325>3.0.co;2-d.

Mockler, R. J. 2001. Making decisions on enterprisewide strategic alignment in multinational alliances. Management Decision, 39 (2), 90–99. https:/ /doi.org/10.1108/EUM0000000005414.

Nath, P. and Mahajan, V. 2008. Chief Marketing Officers: A study of their presence in firms’top management teams. Journal of Marketing, 72 (1), 65–81. https:// doi.org/10.1509/jmkg.72.1.65.

Park, Y. K., Song, J. H., Yoon, S. W., and Kim, J. 2014. Learning organization and innovative behavior: The mediating effect of work engagement. European Journal of Training and Development, 38 (1– 2), 75–94. https://doi.org/10.1108/EJTD-04-2013- 0040.

Phan, P. H. and Peridis, T. 2000. Knowledge creation in strategic alliances: Another look at organizational learning. Asia Pacific Journal of Management, 17 (2), 201–222. https://doi.org/10.1023/ A:1015857525048.

Porter, M. E. 1979. How competitive forces shape strategy. Harvard Business Review, 133–143. https:// doi.org/10.1007/978-1-349-20317-8_10.

Porter, M. E. 1980. Competitive strategy: Techniques for analyzing industries and companies. New York. New York: Free Press. https://doi.org/10.1002/ smj.4250020110.

Porter, M. E. 1990. Competitive advantage of nations. Competitive Intelligence Review, 1 (1), 14–14. https:/ /doi.org/10.1002/cir.3880010112.

Porter, M. E. 2008. The five competitive forces that shape strategy. Harvard Business Review, 86 (1).

Robson, M. J., Skarmeas, D., and Spyropoulou, S. 2006. Behavioral attributes and performance in international strategic alliances: Review and future directions. International Marketing Review, 23 (6), 585–609. https://doi.org/10.1108/ 02651330610712120.

Simsek, Z., Heavey, C., and Veiga, J. F. 2010. The impact of CEO core self-evaluation on the firm’s entrepreneurial orientation. Strategic Management Journal, 31 (1), 110–119. https://doi.org/10.1002/smj.800.

Steiner, A., Morel, L., and Camargo, M. 2014. Well-suited organization to open innovation: Empirical evidence from an industrial deployment. Journal of Innovation Economics, 13 (1), 93. https://doi.org/ 10.3917/jie.013.0093.

Stevenson, H. H., Jarillo, J. C., and Wiley, J. 2012. A Paradigm of Entrepreneurship: Entrepreneurial Management. Strategic Management Journal, 11, 17–27. https://doi.org/10.1007/3-540-48543-0_7.

Tarabishy, A., Solomon, G., Fernald, L. W., and Sashkin, M. 2005. The entrepreneurial leader’s impact on the organization’s performance in dynamic markets. The Journal of Private Equity, 8(4), 20–29. https:/ /doi.org/10.3905/jpe.2005.580519.

Tavitiyaman, P., Qu, H., and Zhang, H. Q. 2011. The impact of industry force factors on resource competitive strategies and hotel performance. International Journal of Hospitality Management, 30 (3), 648–657. https://doi.org/10.1016/j.ijhm.2010.11.010.

Teece, D. J. 2010. Business models, business strategy, and innovation. Long Range Planning, 43(2–3), 172–194. https://doi.org/10.1016/j.lrp.2009.07.003.

Teece, D. J., Pisano, G., and Shuen, A. 1997. Dynamic capabilities and strategic management. Strategic Management Journal, 18 (7), 509–533. https:// d o i . o r g / 1 0 . 1 0 0 2 / ( S I C I ) 1 0 9 7 - 0266199708)18:7<509::AID-SMJ882>3.0.CO;2-Z.

Teng, B.-S. 2005. The emergence and popularization of strategic alliances: Institutional and entrepreneurial views. The International Entrepreneurship and Management Journal, 1 (1), 61–82. https:// doi.org/10.1007/s11365-005-6676-0.

Todeva, E., and Knoke, D. 2005. Strategic alliances and models of collaboration. Management Decision, 43 (1), 123–148. https://doi.org/10.1108/ 00251740510572533.

Wittmann, C. M. 2007. Strategic alliances: What can we learn when they fall?. Journal of Business-to-Business Marketing, 14 (3), 1–19. https://doi.org/10.1300/ J033v14n03_01.

Zikmund, W. G., Carr, J. C., Griffi, M., and Babin, B. J. 2013. Business Research Methods. South-Western, Cengage Learning. https://doi.org/9781285401188.




DOI: http://dx.doi.org/10.21776/ub.jam.2020.018.02.08

Refbacks

  • There are currently no refbacks.