Effect of entrepreneurial orientation and top management team shared responsibility on perceived non-financial performance of star-rated hotels in Uganda

Abstract

Performance of the hotel industry has raised a significant interest and concern for academics and practitioners with non-financial performance measures gaining growing attention to provide additional information to managers. This is attributed to the rate of failure of most star-rated hotels, which is evidently high in Uganda. The purpose of this study was to examine the effect of entrepreneurial orientation and Top Management Team shared responsibility on perceived non-financial performance of star-rated hotels in Uganda. Specific objectives were to examine the effect of: innovativeness on perceived non-financial performance, pro-activeness on perceived non-financial performance, risk taking on perceived non-financial performance, autonomy on perceived non-financial performance, competitive-aggressiveness on perceived non- financial performance, Top Management Team shared responsibility on perceived non- financial performance. Also, the study sought to establish the moderating effect of Top Management Team shared responsibility on the relationship between: innovativeness and perceived non-financial performance, pro-activeness and perceived non-financial performance, risk taking and perceived non-financial performance, autonomy and perceived non-financial performance, competitive-aggressiveness and perceived non- financial performance. The study was guided by resource-based view and upper echelons theories. A positivism research philosophy and an explanatory research design with a cross-sectional approach were adopted, while a multi-stage sampling technique; stratified and simple random sampling techniques was used to collect quantitative data using survey questionnaires administered to a sample size of 265 managers out of a population of 310 managers. Reliability of the research instrument was tested and exploratory factor analysis used to test for validity and underlying patterns. Collected data was screened for completeness and violation of regression assumptions. Both descriptive and inferential statistics were analyzed and a hierarchical regression model was used to test the set hypotheses. Results showed that Entrepreneurial orientation has a significant direct effect on perceived non-financial performance; Innovativeness (H01, β = .400, p=. 000), Pro-activeness (H02, β = .126, p=. 004), Risk-taking (H03, β = .169, p=. 000), Autonomy (H04, β = .314, p=. 000), Competitive aggressiveness (H05, β = .118, p=. 014). Top Management Team Shared Responsibility has a significant direct effect on perceived non-financial performance (H06, β = .193, p= .001) and moderates the relationship between; Innovativeness and perceived non- financial performance (H7a, β =. -147, p=. .009), pro-activeness and perceived non- financial performance (H7b, β =. -.191, p= .044), does not moderate the relationship between risk-taking and perceived non-financial performance (H7c, β =. -.039, p= .403), moderates the relationship between autonomy and perceived non-financial performance (H7d, β = -.043, p=.025) and also moderates the relationship between competitive aggressiveness and perceived non-financial performance (H7e, β = -.093, p=. -0.43). It was concluded that entrepreneurial orientation enhances non-financial performance while Top Management Team shared responsibility acts as a moderator. Therefore, managers should pay close attention to nurturing innovativeness, Pro- activeness, Risk-taking, Autonomy and Competitive aggressiveness to improve star- rated hotel performance and also adopt strategies that enable shared responsibility. Future researchers should further conduct studies in other sectors and also consider qualitative data to establish other factors that may affect non-financial performance of star-rated hotels.