Title: Causal effect of differentiation strategy on organisational performance: the mediating effects of customer orientation and service innovation

Authors: Haim Hilman; Narentheren Kaliappen

Addresses: School of Business Management, Universiti Utara Malaysia, 06010 Sintok Kedah, Malaysia ' School of Business Management, Universiti Utara Malaysia, 06010 Sintok Kedah, Malaysia

Abstract: The purpose of this paper is to investigate the mediating effects of customer orientation and service innovation on causal link of differentiation strategy and organisational performance. Thus, an empirical study was conducted on 60 three- to five-star rated hotels in Malaysia to achieve the objective of this study. The findings show that differentiation strategy has a causal link on customer orientation and service innovation. Importantly, this study found that customer orientation and service innovation mediated the causal link of differentiation strategy and organisational performance. This is the first study that identifies mediating effects of customer orientation and service innovation on differentiation and performance nexus in Malaysian hotel industry. Finally, practical and theoretical implications are highlighted.

Keywords: differentiation strategy; organisational performance; customer orientation; service innovation; firm performance; hotels; hotel performance; Malaysia; hotel industry.

DOI: 10.1504/JIBED.2016.080021

Journal for International Business and Entrepreneurship Development, 2016 Vol.9 No.4, pp.431 - 441

Received: 12 Oct 2015
Accepted: 15 Mar 2016
Published online: 28 Oct 2016 *

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