Firm Resources and Competitive Advantage of Meetings, Incentives, Conference and Exhibitions in Kenya

https://doi.org/10.51867/ajernet.5.3.101

Authors

Keywords:

Competitive Advantage, Firm Resources, Intangible Assets, MICE, Tangible Assets

Abstract

Studies have investigated the effect of firm resources on the management of firms, with very little being done on the attractiveness of Meetings, Incentives, Conferences and Exhibition (MICE) destinations. This study aims to examine how firm resources influence competitiveness of MICE destinations in Kenya. Tangible and intangible assets are the two main categorization of firm resources used for this study, with tangible assets being characterized by brand reputation, innovation and facilities and equipment, while tangible assets being characterized by technology, location and access to financial resources characterized intangible and tangible resources respectively Resource-Based View theory was adopted as the theoretical foundation of the study, as it analyses MICE destination as a bundle or resources which creates value that can never be imitated by competitors. The study applied explanatory research design anchored on positivist philosophical paradigm and the target population was 496 MICE establishments in Nairobi and South-Rift circuits. Purposive sampling technique was used to obtain a sample of 107 MICE establishments. Data collection was through closed-ended questionnaires, with marketing/or operations managers. Data was analysed through descriptive and inferential statistics. Study hypotheses were tested using F-statistic and t-statistics. Findings showed that tangible assets had no significant effect on competitiveness while intangible assets had a significant direct effect on competitiveness. Intangible assets were significant in determining competitive advantage of MICE establishment implying that they need to capitalize more on intangible assets as opposed to tangible assets. The study also confirms the falsifiability of RBV theory as regards tangible assets and therefore recommends exploring other theories to understand how tangible assets affect competitive advantage.

Dimensions

Acedo-Ramírez, M.A., Ayala-Calvo, J.C., & Rodríguez-Osés, J.E. (2012). Capital structure of small companies in the Spanish footwear sector: Relevant factors. SERIEs, 4(2), 155-173. https://doi.org/10.1007/s13209-012-0085-8 DOI: https://doi.org/10.1007/s13209-012-0085-8

Baark, E., Lau A.K.W., Lo W., & Sharif N., (2011). Innovation sources, capabilities and competitiveness: evidence from Hong Kong firms. Paper presented at the DIME Final Conference, 6-8.

Barney, J. (1991). Firm resources and sustained competitive advantage. Journal of Management, 17(1), 99-120.

https://doi.org/10.1177/014920639101700108 DOI: https://doi.org/10.1177/014920639101700108

Belwal, R., & Amireh, M. (2018). Service quality and attitudinal loyalty: Consumers' perception of two major telecommunication companies in Oman. Arab Economic and Business Journal, 13(2), 197-208. https://doi.org/10.1016/j.aebj.2018.11.003 DOI: https://doi.org/10.1016/j.aebj.2018.11.003

Bhatt, A., Rehman, S.U., & Rumman, J.B.A. (2020). Dynamic capabilities mediate between organizational culture, entrepreneurial orientation and organizational performance of SMEs in Pakistan. Entrepreneurial Business and Economics Review, 8(4), 85-103.

https://doi.org/10.15678/EBER.2020.080405 DOI: https://doi.org/10.15678/EBER.2020.080405

Bolatto, S., Naghavi, A., Ottaviano, G., & Zajc Kejzar, K. (2017). Intangible assets and the organization of global supply chains, working papers wp1105. Dipartimento Scienze Economiche, Universita' di Bologna. https://doi.org/10.2139/ssrn.3028044 DOI: https://doi.org/10.2139/ssrn.3028044

Bontempia, M.E., & Mairesse, J. (2015). Intangible capital and productivity at the firm level: A panel data assessment. Economics of Innovation and New Technology, 24(2), 22-51. https://doi.org/10.1080/10438599.2014.897859 DOI: https://doi.org/10.1080/10438599.2014.897859

Boudiaf, I., & Chofri, M. (2021). The progressive effect of intangible assets on developing competitive advantage: A case study of the telecommunications sector in Algeria, 7(3), 802-817.

Bykova, A., & Jardon, C.A. (2018). The mediation role of companies' dynamic capabilities for business performance excellence: Insights from foreign direct investments. The case of transitional partnership. Knowledge Management Research & Practice, 16(1), 144-159.

https://doi.org/10.1080/14778238.2018.1428070 DOI: https://doi.org/10.1080/14778238.2018.1428070

Carboni, O. A., & Medda, G. (2017). R&D, export and investment decision: evidence from European firms. Applied Economics, 50(2), 187-201. https://doi.org/10.1080/00036846.2017.1332747 DOI: https://doi.org/10.1080/00036846.2017.1332747

Chukwu, J.G., & Egbuhuzor, A.C. (2017). Tangible assets and corporate performance: Evidence from the manufacturing industry in Nigeria. Research Journal of Financial Sustainability Reporting, 2(1), 271-277.

Ciriaci, D. (2017). Intangible resources: The relevance of training for European firms' innovative performance. Econ Polit, 34, 31-54.

https://doi.org/10.1007/s40888-016-0049-8 DOI: https://doi.org/10.1007/s40888-016-0049-8

Cooper, R., & Schinder, S. (2013). Business research methods. McGraw Hill.

Crouch, G.I., & Ritchie, J.R.B. (1999). Tourism, competitiveness and societal prosperity. Journal of business research, 44(3), 137-152.

https://doi.org/10.1016/S0148-2963(97)00196-3 DOI: https://doi.org/10.1016/S0148-2963(97)00196-3

Daniel, B., & Gabor, S. (2017). Can tangible assets be determinant in capital structure including profitability? Comparative analysis on the Hungarian and the French wine industries. Journal of Wine Research, 28(1), 46-55. https://doi.org/10.1080/09571264.2016.1211513 DOI: https://doi.org/10.1080/09571264.2016.1211513

Donbesuur, F., Ampong, G.O.A., Owusu-Yirenkyi, D., & Chu, I. (2020). Technological innovation, organizational innovation and international performance of SMEs: The moderating role of domestic institutional environment. Technological Forecasting and Social Change, 161, 120252. doi:10.1016/j.techfore.2020.12025 DOI: https://doi.org/10.1016/j.techfore.2020.120252

El Ebrashi, R. (2018). Typology of growth strategies and the role of social venture's intangible resources. Journal of Small Business and Enterprise Development, 25(5), 818-848. https://doi.org/10.1108/JSBED-03-2017-0104 DOI: https://doi.org/10.1108/JSBED-03-2017-0104

Elbanna, S., & Elsharnouby, T.H. (2018). Revisiting the relationship between formal planning process and planning effectiveness: Do dynamic capabilities and decision-making style matter? International Journal of Contemporary Hospitality Management, 30(2), 1016-1034. https://doi.org/10.1108/IJCHM-12-2016-0675 DOI: https://doi.org/10.1108/IJCHM-12-2016-0675

Galati, A. Tulone, A., Tinervia, S., & Crescimanno, M. (2019). The role of internal resources in the competitive positioning of Sicilian wine cooperatives. International Journal of Globalization and Small Business, 10(4), 324. https://doi.org/10.1504/ijgsb.2019.103582 DOI: https://doi.org/10.1504/IJGSB.2019.103582

Gaya, H. (2017). Tangible resources are the first step in the value creation process of sources of sustainable competitive advantage in a services firm: An activity- resource-based view (ARBV) theory? Global Journal of Management and Business Research: Administration and Management. 17(2), 1-12.

Haji, A.A, & Ghazali, N.A.M. (2018). The role of intangible assets and liabilities in firm performance: Empirical evidence. Journal of Applied Accounting Research, 19(1), 42-59. https://doi.org/10.1108/JAAR-12-2015-0108 DOI: https://doi.org/10.1108/JAAR-12-2015-0108

Han, Y., & Li, D. (2015). Effects of intellectual capital on innovative performance. Management Decisions, 53(1), 40-56.

https://doi.org/10.1108/MD-08-2013-0411 DOI: https://doi.org/10.1108/MD-08-2013-0411

Hoque, A., Siddiqui, B.A., & Baharu, S. (2018). Exploratory factor analysis of entrepreneurial orientation in the context of Bangladeshi small and medium enterprises (SMES). European Journal of Management and Marketing Studies, 3(2), 81-94.

Hoque, A.S.M.M, Siddiqui, B.A., Baharu, S.M.A.T. (2018). Exploratory factor analysis of entrepreneurial orientation in the context of Bangladeshi small and medium enterprises (SMES). European Journal of Management and Marketing Studies, 3(2), 81-94.

Horvathova, J., & Mokrisova, M. (2020). Business competitiveness, its financial and economic parameters. Montenegrin Journal of Economics, 16(1), 139-153. https://doi.org/10.14254/1800-5845/2020.16-1.9 DOI: https://doi.org/10.14254/1800-5845/2020.16-1.9

Ionita, C., & Dinu, E. (2021). The effect of intangible assets on sustainable growth and firm value - Evidence on intellectual capital investment in companies listed on Bucharest Stock Exchange. Print. https://doi.org/10.1108/K-05-2020-0325 DOI: https://doi.org/10.1108/K-05-2020-0325

Iriyanto, S., Suharnomo, Hidayat, M.T. & Anas, M. (2021). Do intangible assets and innovation orientation influence competitive advantages? A case study of SMEs in Indonesia. Universal Journal of Accounting and Finance. 9(1), 105-115.

https://doi.org/10.13189/ujaf.2021.090111 DOI: https://doi.org/10.13189/ujaf.2021.090111

Irungu, A.M., Muturi, W., Nasieku, T., & Ngumi, P. (2018). Effect of asset tangibility on financial performance of listed firms in the Nairobi Securities Exchange. Journal of Finance & Accounting, 2(3), 55-74.

Jacob, C. & Kornom-Gbaraba, M.E. (2022). Effect of tangible and intangible assets structure on the performance of high and laow levered quoted manufacturing firms in Nigeria. Advanced Journal of Education and Social Sciences, 7(10), 12-27.

Jawed, I., & Siddiqui, D.A. (2019). What matters for firms' performance: Capabilities, tangible or intangible resources? Evidence from corporate sectors on Pakistan. SSRN. https://doi.org/10.2139/ssrn.3510562 DOI: https://doi.org/10.2139/ssrn.3510562

Jogaratnam, G. (2017). The effect of market orientation, entrepreneurial orientation and human capital on positional advantage: Evidence from the restaurant industry. International Journal of Hospitality Management, 60, 104-113. https://doi.org/10.1016/j.ijhm.2016.10.002 DOI: https://doi.org/10.1016/j.ijhm.2016.10.002

Khan, K.U., Atlas, F., Ghani, U., Akhtar, S., & Khan, F. (2021). Impact of intangible resources (dominant logic) on SMEs innovation performance, the mediating role of dynamic managerial capabilities: Evidence from China. European Journal of Innovation Management, 24(5), 1679-1699. https://doi.org/10.1108/EJIM-07-2020-0276 DOI: https://doi.org/10.1108/EJIM-07-2020-0276

Kimeli, K., Burugu, R., & Korir, J. (2020). Business location as a catalyst for competitive advantage of small hospitality enterprises in Eldoret, Kenya. African Journal of Education, Science and Technology, 6(1), 209-220.

König, C., Caldwell, N.G., & Ghadge, A. (2019). Service provider boundaries in competitive markets: The case of the logistics industry. International Journal of Production Research, 57(18), 5624-5639. https://doi.org/10.1080/00207543.2018.1535203

König, C., Caldwell, N.G., & Ghadge, A. (2019). Service provider boundaries in competitive markets: The case of the logistics industry. International Journal of Production Research, 57(18), 5624-5639. https://doi.org/10.1080/00207543.2018.1535203 DOI: https://doi.org/10.1080/00207543.2018.1535203

Kothari, C. R., & Gang, W. (2014). Research Methodology: Methods and Techniques. New Age International Publishers Ltd.

Kraja, Y. B. (2018). The impact of tangible and intangible assets on the SMEs' Success: The Albanian Case. Springer International Publishing, 4(9), 135-145. https://doi.org/10.1007/978-3-319-75907-4_9 DOI: https://doi.org/10.1007/978-3-319-75907-4_9

Lee, J., & Karpova, E. (2018). Revisiting the competitiveness theory in the new global environment: Review and analysis of the competitiveness definition. International Journal of Competitiveness, 1(3), 189. https://doi.org/10.1504/ijc.2018.091474 DOI: https://doi.org/10.1504/IJC.2018.091474

Lelissa, T. B. (2018). Research methodology (PhD thesis, University of South Africa).

Lippman, S.A., & Rumelt, R.P. (2003). A bargaining perspective on resource advantage. Strategic management journal, 24(11), 1069-1086. https://doi.org/10.1002/smj.345 DOI: https://doi.org/10.1002/smj.345

Lukito, H. (2015). A closer look at West Sumatra public universities performance and their intangible assets. Andalas Management Review, 1(1), 85-100.

Madhani, P.J. (2015). A study on the corporate governance and disclosure practices of tangible assets and intangible assets-dominated firms and their relationships. The IUP Journal of Corporate Governance, 14(2), 7-29

Main, L. (2016). Assessing intangible assets and their value to business: business and economy. Sabinet, 2016(28)

Makhloufi, L., Azbiya N.Y., Laghouag, A.A., Sahli, A.A., Belaid, F., & Tan, A.W.K. (Ed.). (2021). Effect of IT capability and intangible IT resources on sustainable competitive advantage: Exploring moderating and mediating effect of IT flexibility and core competency, Cogent Business & Management, 8(1), Article: 1935665. https://doi.org/10.1080/23311975.2021.1935665 DOI: https://doi.org/10.1080/23311975.2021.1935665

Mazanec, J. A., & Ring, A. (2011). Tourism destination competitiveness: second thoughts on the World Economic Forum reports. Tourism Economics, 17(4), 725-751. https://doi.org/10.5367/te.2011.0065 DOI: https://doi.org/10.5367/te.2011.0065

Mengistu, M. (2018). The effect of bank specific sources of competitive advantage on performance: In the case of Ethiopia private commercial banks. https://projectng.com/topic/ma18678/

Mikalef, P., Boura, M., Lekakos, G., & Krogstie, J. (2019). Big data analytics capabilities and innovation: The mediating role of dynamic capabilities and moderating effect of the environment. British Journal of Management, 30(2), 272-298. https://doi.org/10.1111/1467-8551.12343 DOI: https://doi.org/10.1111/1467-8551.12343

Miyamoto, M. (2017). IT-business alignment and resource-based view of competitive advantage: Intangible assets of Korean SMEs. Universal Journal of Management, 5(3), 101-109. https://doi.org/10.13189/ujm.2017.050301 DOI: https://doi.org/10.13189/ujm.2017.050301

Monteiro, A.P., Soares, A.M., & Rua, O.L. (2017). Linking intangible resources and export performance: The role of entrepreneurial orientation and dynamic capabilities. Baltic Journal of Management, 12(3), 329-347. https://doi.org/10.1108/BJM-05-2016-0097 DOI: https://doi.org/10.1108/BJM-05-2016-0097

Mwantimwa, K. (2019). ICT usage to enhance firms' business processes in Tanzania. Journal of Global Entrepreneurship Research, 9(1), 1-23. https://doi.org/10.1186/s40497-019-0170-6 DOI: https://doi.org/10.1186/s40497-019-0170-6

Mwita, M. (2019). Convention bureau, key to Kenya's MICE industry growth. 29th March, 2021, the-star.co.ke

Nichita, M. (2019). Intangible assets-insights from a literature review. Journal of Accounting and Management Information Systems, 18(1), 4-24. https://doi.org/10.24818/jamis.2019.02004 DOI: https://doi.org/10.24818/jamis.2019.02004

Nicklas, A., & Hnerik, A. (2017). Increased gross profits from intangible and tangible assets: From a modular product's perspective. DiVA, 77.

Okoth, P.J., & Machuki, V.N. (2018). Tangible resources and performance of county health services in Kenya. American International Journal of Contemporary Research, 8(3), 25-42. https://doi.org/10.30845/aijcr.v8n3p4 DOI: https://doi.org/10.30845/aijcr.v8n3p4

Orhangazi, Ö. (2018). The role of intangible assets in explaining the investment-profit puzzle. Cambridge Journal of Economics. https://doi.org/10.1093/cje/bey046 DOI: https://doi.org/10.1093/cje/bey046

Othman, R., Arshad, R., Aris, A.N., & Arif, M.M.S. (2015). Organizational resources and sustained competitive advantage of cooperative organizations in Malaysia. Social and Behavioural Sciences, 170, 120-127. https://doi.org/10.1016/j.sbspro.2015.01.021 DOI: https://doi.org/10.1016/j.sbspro.2015.01.021

Othman, R., Arshad, R., Aris, A.N., & Arif, M.M.S. (2018). Exploiting resources for competitive advantage of cooperative organizations in Malaysia. Asian Journal of Behavioral studies, 3(12), 63-71. https://doi.org/10.21834/ajbes.v3i12.124 DOI: https://doi.org/10.21834/ajbes.v3i12.124

Penrose, E.T. (1959). The theory of the growth of the firm. Oxford University Press.

Peshkov, A. V. (2020). Smart technologies as a type of intangible assets of a construction organization and mechanisms for their implementation. IOP Conference Series: Materials Science and Engineering, 880(1), 012081. https://doi.org/10.1088/1757-899X/880/1/012081 DOI: https://doi.org/10.1088/1757-899X/880/1/012081

Petts, N. (1997). Building growth on core competences-a practical approach. Long Range Planning, 30(4), 551-561. https://doi.org/10.1016/S0024-6301(97)00034-4 DOI: https://doi.org/10.1016/S0024-6301(97)00034-4

Pluminsa, M., Sceulovs, D., Gaile, E., & Sarkane, (2016). Competitiveness definitions and concepts qualitative content analysis. In International Scientific Conference Economics and Management, 380-386.

Putra, D.G., Rahayu, R., & Putri, A. (2021). The influence of Enterprise Resource Planning (ERP) implementation system on company performance mediated by organizational capabilities. Journal of Accounting and Investment, 22(2), 221-241. https://doi.org/10.18196/jai.v22i2.10196 DOI: https://doi.org/10.18196/jai.v22i2.10196

Radhakrishnan, S., Wang, H., Wang, K., & Zhu, Z. J. (2017). R&D investment and firm growth: the role of tangible asset complementarity. SSRN 3096806. https://doi.org/10.2139/ssrn.3096806 DOI: https://doi.org/10.2139/ssrn.3096806

Radulovich, L., Javalgi, R., (R).G., & Scherer, R.F. (2018). Intangible resources influencing the international performance of professional service SMEs in an emerging market: Evidence from India. International Marketing Review, 35(1), 113-135. https://doi.org/10.1108/IMR-06-2016-0130 DOI: https://doi.org/10.1108/IMR-06-2016-0130

Ramadhan, M.Z.D., Putri, N.K., & Arofah, T. (2022). Impact of tangible assets and intangible assets with sustainable growth as moderating variable on value of firms listed on index growth 30 periods 2019-2020. International conference on sustainable competitive advantage, 89-108.

Rifat, K. (2017). The contribution of tangible and intangible resources, and capabilities to a firm's profitability and market performance. European Journal of Management and Business Economics, 26(2), 252-275.

https://doi.org/10.1108/EJMBE-07-2017-015 DOI: https://doi.org/10.1108/EJMBE-07-2017-015

Rozmi, A.N.A. (2022). The perception of ICT adoption in small medium enterprise: A SWOT analysis. International Journal of Innovation and Business (IJIBS), 9(1), 69-79.

Rua, O.L. (2018). From intangible resources to export performance: Exploring the mediating effect of absorptive capabilities and innovation. Review of International Business and Strategy, 28(3/4), 373-394. https://doi.org/10.1108/RIBS-02-2018-0012 DOI: https://doi.org/10.1108/RIBS-02-2018-0012

Sable, K., Roy, A., & Deshmukh, R. (2019). MICE Industry by Event Type (Meetings, Incentives, Conventions and Exhibitions): Global Opportunity Analysis and Industry Forecast 2018-2025. Allied Market Research, 1-136.

Saleh, M. (2018). Impacts of tangible and intangible asset investment on value of manufacturing companies listed on the Indonesia Stock Exchange. Archives of Business Research, 6(10), 402-414. https://doi.org/10.14738/abr.610.5374 DOI: https://doi.org/10.14738/abr.610.5374

Simiyu, F., Lewa, P., Ouma, C., & Ndwiga, M. (2016). Effects of firm conduct on performance of Kenya meeting, incentives, conferences and exhibitions (MICE) industry. European Journal of Business and Management, 8(15), 34-42.

Solomon, E.M., & van Klyton, A. (2020). The impact of digital technology usage on economic growth in Africa. Utilities policy, 67, 101104.

https://doi.org/10.1016/j.jup.2020.101104 DOI: https://doi.org/10.1016/j.jup.2020.101104

Sutanto, E.M., & Sudarsono, D. (2018). Empirical analysis of firm resources in the banking industry in Indonesia: A resource-based view. Petra Christian University.

Tussyadiah, I.P. (2016). Factors of satisfaction and intention to use peer-to-peer accommodation. International Journal of Hospitality Management, 14(3), 87-96. https://doi.org/10.1016/j.ijhm.2016.03.005 DOI: https://doi.org/10.1016/j.ijhm.2016.03.005

Verdier, E. (2019). Jumia Hospitality Report Africa 2019. (3rd ed.). https://www.hospitalitynet.org/file/152008745.pdf (retrieved on 22nd June, 2020)

Von Krogh, G., & Roos, J. (1995). A perspective on knowledge, competence and strategy. Personnel review, 24(3), 56-76.

https://doi.org/10.1108/00483489510089650 DOI: https://doi.org/10.1108/00483489510089650

Wernefelt, B. (1984). A resource-based view of the firm. Strategic Management Journal, 5,171-180. https://doi.org/10.1002/smj.4250050207 DOI: https://doi.org/10.1002/smj.4250050207

Wibowo, A.Y., Sule, E.T., Rahman, S., & Cahyandito, M.F. (2021). The influence of company asset and competitive strategy on the company business value of dividing industry in Indonesia. Academy of Strategic Management. 20(6), 1-11.

Zheng, X. (2018). Research on the marketing strategy of MICE Cities taking Asia as an example. Advances in Social Science, Education and Humanities Research, 945-956. DOI: https://doi.org/10.2991/iccese-18.2018.215

https://www.tourismauthority.go.ke. (Retrieved on 22nd June, 2020)

Published

2024-09-19

How to Cite

Owiyo, V. (2024). Firm Resources and Competitive Advantage of Meetings, Incentives, Conference and Exhibitions in Kenya. African Journal of Empirical Research, 5(3), 1191–1201. https://doi.org/10.51867/ajernet.5.3.101