Lembang Asri Resort’s Competitive Advantage

Kevin Christiandy and Jacob Donald Tan

Universitas Pelita Harapan, Karawaci, Tangerang, Banten, Indonesia

Keywords: Competitive Advantage, Leadership, Consumer Behaviors.

Abstract: Lembang Asri Resort, established in 1990, is one of the hotels that are located in Lembang, Bandung, West

Java province. Badan Pusat Statistik (2016) data shows that there are 385 hotels with 21,212 room units in

Bandung in 2016, which are the most in West Java province. Although the demand is high, the huge

growing number of hotels developed by international hotel management chains, domestic chains and

individual developers causes an oversupply in Bandung hotel industry. Thus, currently, hotel

competitiveness in Lembang is considered to be particularly vigorous. This single instrumental case study

offers an explicit insight into Lembang Asri Resort – a 3-star hotel – through qualitative research to induce

factors impacting its competitive advantage to sustain and further become a 4-star or even 5-star hotel.

1 INTRODUCTION

Hariyadi Sukamdani as the General Head of IHRA

(Indonesian Hotel and Restaurant Association),

stated that Indonesia has the most hotel rooms than

any other countries in ASEAN (Tempo, 2015). In

2016, there are 233,007 room units in 2,387 star

hotels and 294,169 room units in 16,442 non-star

hotels in Indonesia (BPS, 2016). West Java is a

province that has the most hotels in Indonesia with

1,722 hotels consists of 314 star hotels and 1,408

non-star hotels in 2016 (BPS, 2016). The main

attractions in Bandung are the retail stores that sell

affordable branded clothing products, culinary

destinations and natural destinations with cool

temperature climate (Batchelor et al., 2016). Based

on the recapitulation data of tourist visits to

Bandung, Soemardi (2015) denoted the domestic

demand dominates the tourist visits by

approximately 97% of tourist arrivals in 2015. In

addition, the number of foreign tourist visits to

Bandung is significantly increasing for

approximately 90.63% month-on-month in April

2016 after the reconditioning of Husein Sastranegara

International Airport (Jakarta Post, 2016).

Lembang Asri received a certification as a 3-star

hotel. Lembang Asri Resort contains 77 rooms and

two villas with the total capacity of 300 to 400

persons. It provides facilities such as outbound area,

swimming pool, tennis court, restaurants and many

others for its guests. The average occupancy level

reached approximately 38% from January to August

2017. Domestic and international tourists stay in

Lembang Asri Resort to enjoy holiday with family

and friends or conduct meeting and event.

There are many factors from the external

environment that might bring challenges to

Lembang Asri Resort. The increase in competition

pushes hotels to search for ways to retain the

existing customers and to appeal to new customers.

Particularly according to Perhimpunan Hotel dan

Restoran Jawa Barat (Octaviani, 2016), Bandung

hotel industry experiences oversupply that decreases

average hotel occupancy and might further lead to

hotel income loss. There is a possibility that

Lembang Asri Resort cannot sustain for more years

if the hotel is not able to implement appropriate

strategy accordingly in its operation. Mihalic and

Buhalis (2013) stated, in order to be competitive and

experience increasing business performance, service

companies have to identify the key resources while

also access and capitalize those resources.

Therefore, it is substantial for Lembang Asri Resort

to focus on the factors that may contribute to its

competitive advantage. In this research, the factors

analyzed are the personal characteristics of the

leaders and consumer behaviors in the industry.

Lembang Asri could use the study to further explore

the factors and try to take advantage from those.

Research Questions

1. What are the personal characteristics of the

leaders that contribute to the competitive

advantage of Lembang Asri Resort?

Christiandy, K. and Tan, J.

Lembang Asri Resort’s Competitive Advantage.

DOI: 10.5220/0008488100530058

In Proceedings of the 7th International Conference on Entrepreneurship and Business Management (ICEBM Untar 2018), pages 53-58

ISBN: 978-989-758-363-6

2. Why do consumers prefer to stay in Lembang

Asri compared to other competitors?

2 LITERATURE REVIEW

2.1 Competitive Advantage

Competitive advantage based on Wagner and

Hollenbeck (2014) is a special ability possessed by a

company that cannot be duplicated by competitors.

According to Porter (1985), competitive advantage

develops from the value that the firm can create for

the buyers. It can be generated from complementary

capabilities of the company that may serve the

customers better than competitors (Laszlo and

Zhexembayeva, 2017). Competitive advantage

possessed by a firm may increase the likelihood of

the people to consume its product or service. It may

be used to gain more sales or sales margin that may

further positively impact the financial performance

of the firm. Therefore, firms are giving much effort

in creating a sustainable competitive advantage in

order to be superior over the competitors.

Porter (1985) explained that a firm could

generate competitive advantage from two main

types, which are cost leadership and differentiation.

Basically, a firm can gain a competitive advantage

by being cheaper or being unique. The competitive

scope chosen and firm’s activities range also can

affect the competitive advantage of the firm (Porter

and Millar, 1985).

2.2 Leadership

Leadership theories have already been defined since

a long time ago. Many researchers and philosophers

have tried to describe leadership in theories.

Therefore, there are several theories of leadership

that can be examined including the Great Man

theory, Trait theory, Behavioral theories,

Contingency theories, Transactional theories and

Transformational theories.

Particularly, for hotel managers, Clark et al.,

(2009) examine transformational leadership as the

ideal leadership style in conducting the hotel’s

frontline employees. In addition, there are six

components of leadership competency that are

important according to Tavitiyaman et al., (2014),

including leadership, motivational and interpersonal

skills, strategic orientation, planning and

implementation, team building and ethics,

communication skills, flexibility, and concern for

the community. Clark et al., (2009) state the role of

hotel managers in constantly influencing employees,

so that employees may adopt manager’s and firm’s

customer orientation and commitment to provide a

good service.

Johnstal (2013) examines the importance of

successful leadership development in creating a

competitive advantage and coping with the

challenges of global competition, advancing

technology and the growing pace of change. There

are several characteristics required such as thinking

critically, breakthrough thinking, creating innovative

solutions, inspiring others and taking complex and

ambiguous challenges (Johnstal, 2013).

In order to become successful, the leader has to

notice the importance of transfer of leadership.

Transfer of leadership can be done through the

leadership development. It is a process that involves

facilitators to lead participants to pass a set of

activities to conduct mental activities and help them

to learn from the experiences in order to obtain the

transfer of knowledge and skills in the work context

(Burke and Collins, 2005). Furthermore, in order to

conduct the process of leadership development

successfully, there are three important components,

such as are important including leadership support,

evaluation and organizational issues (Johnstal 2013).

3 RESEARCH METHODOLOGY

In order to gain knowledge from this single

instrumental case study research, qualitative

research is chosen. Qualitative research tries to

understand people’s perspectives in experiencing

reality (Corbin and Strauss, 2008). Taylor et al.,

(2015) denoted that qualitative research is inductive

as it constructs concepts, insights and

understandings from the data rather than collecting

data in order to evaluate a model, hypotheses and

theories. Furthermore, qualitative method views

people and setting holistically, concerns about how

people think and act, considers all perspectives,

emphasizes the meaning of the research and

considers the research as a craft (Taylor et al., 2015).

This case study research explores the factors that

contribute to the competitive advantage of Lembang

Asri Resort and tries to discover the personal

characteristics of the leaders that contribute to the

competitive advantage, consumer behaviors in the

marketplace, and Lembang Asri’s response towards

customer needs and desires. Furthermore, this

research applies single instrumental case study.

“Instrumental case study is the study of a case (e.g.

person, specific group, occupation, department,

ICEBM Untar 2018 - International Conference on Entrepreneurship and Business Management (ICEBM) Untar

organization) to provide insight into a particular

issue, redraw generalizations or build theory” (Mills

et al., 2010, p. 473). In order to achieve the goal,

researchers have to access certain related materials

to define the background of the study and state the

issues that contribute to a single issue (Creswell and

Poth, 2017).

In the duration of almost 5 months, the

researchers used four main research methods: in-

depth interviews, focus group discussions (FGDs),

observation, and direct observations. The

respondents were 2 upper-level leaders of the resort,

3 loyal guests categorized as Free Independent

Travellers (FIT), and 4 loyal guests from Group

Inclusive Tour (GIT) category. A couple of FGDs

were conducted within the GIT guests. In addition,

one of the researchers engaged in participant

observation for about 30 days in Lembang Asri

Resort. He worked in different hotel departments to

associate with the guests and employees and “get

accustomed” to the overall environments of the

resort.

4 ANALYSIS AND DISCUSSIONS

4.1 Research Question 1: Personal

Characteristics of the Leaders That

Contribute to the Competitive

Advantage of the Hotel

Proposition 1: Accountability (V6) and loyalty (V1)

of the leaders of Lembang Asri influence the hotel

and its employees. Their sense of responsibility for

the hotel improvement and the employee

development makes them want to stay working in

Lembang Asri.

Proposition 2: Lembang Asri leaders possess loyalty

(V1) that allows them to work and lead the

employees with experience, knowledge and related

skills. Thus, leaders’ loyalty has an influence to their

experience and skill (V8) for working in Lembang

Asri. Experience and skilful leaders might suppress

errors in their decision-making and be able to

transfer their leadership, experience and knowledge

to other employees.

Proposition 3: Leaders’ desire to thrive (V2) makes

them consistently willing to find ways in order to

create improvement and development for the hotel.

This attitude gives them the willingness to stay

working in Lembang Asri. Therefore, leaders’ desire

to thrive affects their loyalty (V1) to the hotel.

Proposition 4: Desire to thrive (V2) allows leaders to

have the willingness to learn (V7). Their passion in

developing the hotel leads to their eagerness to learn

new knowledge.

Proposition 5: Willingness to learn (V7)

characteristic brings leaders to continuously learn

new knowledge and skills. Willingness to learn

would certainly help them to gain their experience

and skills (V8).

Proposition 6: Experienced and skilful (V8) leaders

certainly contribute to the hotel competitive

advantage (V30) as the leaders have the capabilities

to manage, organize, assess, communicate and lead

the hotel and the team of employees.

Proposition 7: Desire to thrive (V2) triggers leaders

to find a way for improving the hotel’s products and

services by using their creativity (V9)

Proposition 8: Creativity (V9) possessed by the

leaders is useful in finding unique ideas to improve

hotel products and services. Therefore, it would

contribute to the hotel competitive advantage (V30)

because it might be an important element in

increasing hotel sales and profits.

Proposition 9: Inspiring (V3) characteristic of the

leaders allows them to influence and move the

employees to work in a better way. These

characteristic generate employees’ motivation that

further creates a better employees’ work

performance (V10).

Proposition 10: Caring (V4) characteristic of the

leaders would make the employees feel accepted and

noticed. It might contribute to the employee work

performance (V10).

Proposition 11: Respectful (V5) leaders would

establish a strong relationship between leaders and

employees that would eventually increase

employees’ work performance (V10).

Proposition 12: Employees’ work performance

(V10) would be a competitive advantage (V30) of

Lembang Asri Resort, as its employees perform their

duties well.

4.2 Research Question 2: Consumers’

Preferences to Stay in Lembang

Asri Resort

Proposition 13: The location of Lembang Asri is

considered as strategic by some guests because of its

ease of access. Mr. Anton (FIT guest) said that

Lembang Asri is located in an area with fewer traffic

jams compared to other areas in Bandung. In

addition, Lembang Asri guests have several route

options to get to the hotel. Accessibility to the hotel

Lembang Asri Resort’s Competitive Advantage

(V11) would be a factor of competitive advantage

(V30) of Lembang Asri.

Proposition 14: Lembang Asri’s modern room

concept (V16) contributes to the hotel competitive

advantage (V30) because the concept provides

comfort and pleasure for the guests staying in

Lembang Asri.

Proposition 15: Family-friendly rooms (V15) owned

by Lembang Asri are sought by most customers

because of the spacious area and complete facilities

inside the rooms. This type of bedroom that is

comfortable for family can increase the customer

satisfaction (V29).

Proposition 16: For most family guests that bring

children to the hotel, playground and games for kids

(V12) are very important. Playground and games

that are available inside the hotel building not only

make the kids happy but also provide convenience

for the parents, as they do not need to search for

playground outside the hotel. Moreover, from

interviews with several FIT guests (Mr. Benny &

Mrs. Jessica, and Mr. Anton), they suggested some

additions to kids’ games in Lembang Asri.

Therefore, it is expectd to be a factor that contributes

to customer satisfaction (V29).

Proposition 17: Natural (V13) environment in the

hotel area provides convenience and comfort for the

guests. This condition would bring customers’

satisfaction (V29) during their stay at Lembang Asri.

Proposition 18: Food and beverages products (V17)

provided by Lembang Asri restaurants are

considered by guests as tasty and inexpensive. This

creates convenience for guests as they like the

hotel’s meals, so that they do not need to bother

searching for meals outside the hotel. Therefore,

tasteful and inexpensive food and beverages

products create satisfaction (V29) for the guest.

Proposition 19: Discounted room rate (V14)

provided by Lembang Asri to the loyal guests might

contribute to their customer satisfaction (V29).

Proposition 20: As most guests use a resort for

holiday, meetings or outbound purposes, they prefer

a location that is far away from the crowd. They

require serenity (V19) inside the hotel to make their

stay comfortable and enjoyable. Serenity around

Lembang Asri Resort environment would be a factor

contributing to the customer satisfaction (V29).

Proposition 21: Lembang Asri guests are mostly

coming to Lembang to search for fresh air. The

availability of fresh air (V20) in Lembang Asri

Resort makes them enjoy their stay there. This is

another factor that contributes to customer

satisfaction (V29).

Proposition 22: Guest-friendly service (V21) is an

important factor that makes guests’ stay in Lembang

Asri more pleasant, as friendly and helpful services

increase guests’ satisfaction (V29). Proposition 23:

Guest-friendly services (V21) trigger guests’

acquaintanceship (V22) with the employees, as they

are friendly, helpful and initiative towards the

guests. This will eventually establish a strong bond

of friendship.

Proposition 24: There are many aspects of service

that influenced the guests’ familiarity with

employees. The guests’ familiarity with the

employees (V22) would certainly give the guest the

feeling of comfort and security. It also creates a

trusting relationship between guests and employees

(V28).

Proposition 25: Trustworthy employees (V28)

increase customer satisfaction (V29) in staying at

Lembang Asri. For example, in 26 August 2017,

Lembang Asri employees’ honesty and integrity

were proven by not taking the guest valuable

objects. This made the guest trusted them and

appreciated their services. In this particular case,

customer satisfaction increased when the guest knew

that Lembang Asri employees could be trusted.

Proposition 26: GIT guests considered Lembang

Asri marketing department was helpful in their

process of reservation. GIT guests in their interviews

said that the sales marketing employees were

helpful, nice to talk to, responsive and easily

contacted. The ease for reservation (V26), therefore,

increases their customer satisfaction (V29).

Proposition 27: Responsive guest services (V27) in

the hotel also improve customer satisfaction (V29).

Responsive employees create convenience for the

committee of GIT guests that are usually busy in

organizing the details of the event. Mr. T. (GIT

guest) in the interview told his experience when his

group had a problem in room distribution at 1 a.m.,

and he then contacted Lembang Asri employees, the

housekeeping and front office divisions were very

responsive to assist him although it was already in

the middle of the night.

Proposition 28: Lembang Asri is able to facilitate

guests who want to organize events in a hall (V24)

with a capacity of 500 people. This is the biggest

capacity hall in Lembang. Thus, Murdania

Convention Hall is a factor that contributes to the

resort’s competitive advantage (V30).

Proposition 29: Green function (V25) is useful to

facilitate events held by guests such as outbounds

and gatherings. On the other hand, the hotel

sometimes uses green function to conduct events

ICEBM Untar 2018 - International Conference on Entrepreneurship and Business Management (ICEBM) Untar

Figure 1: Proposed Conceptual Framework.

such as New Year’s Celebration and other events

that are beneficial in attracting guests. As it is able to

facilitate and attract guests to stay in Lembang Asri,

it would be considered as a factor that contributes to

the competitive advantage (V30) of Lembang Asri.

Proposition 30: For the GIT guests, Lembang Asri’s

affordable room package rates satisfy them very

much because some of them are from non-profit

organizations with limited budgets. Therefore,

affordable prices (V23) offered by the resort benefit

them and increase their customer satisfaction (V29)

towards Lembang Asri.

Proposition 31: Customer satisfaction (V29) that is

influenced by several aspects in Lembang Asri

would impact prospective guests’ decision-making

in choosing their stays. With high customer

satisfaction, they are more likely to become

Lembang Asri loyal customers (V18).

Proposition 32: Lembang Asri loyal customers

(V18) can be considered as a factor that contributes

to the competitive advantage (V30) of the hotel,

because retaining customers are essential for the

resort to maintain its competitiveness in the industry.

On the other hand, loyal guests are also more likely

to recommend Lembang Asri to other potential

guests.

In summary, as shown in Fig. 1, the findings are

depicted through propositions that elucidate

preferences of the guests to stay and revisit the

resort. The induced latent variables are categorized

based on the attributes of the leadership, the

perspectives of the FIT guests, the perspectives of

the GIT guests, as well as the combined perspectives

of both the FIT and GIT guests.

5 CONCLUSIONS

Besides growing competitiveness in its segment,

Lembang Asri Resort also facing a challenge to

manage external forces, in particular the regulation

to limit governmental meetings outside the office

such as in hotel, resort, villa that are not owned by

the government (Kementerian Pendayagunaan

Aparatur Negara dan Reformasi Birokrasi, 2015), in

order to improve efficiency and effectiveness of

work among government employees. As a result,

private hotels like Lembang Asri are being

disadvantaged due to the shortage of governmental

guests. Hence, the much-needed proposed

conceptual framework (Fig. 1) would support

Lembang Asri in recognizing factors contributing to

its competitive advantage to develop hotel

competitiveness and sustainability. Lembang Asri

leaders, including the Director, the Manager and the

Supervisors have to keep on developing positive

influences into their teams. The team employees

Lembang Asri Resort’s Competitive Advantage

must also continue to reinforce the factors

contributing to guest satisfaction to retain customers

or even attract potential guests. Consequently,

Lembang Asri Resort would be able to sustain and

further improve to become a 4-star hotel and even a

5-star hotel in the future.

ACKNOWLEDGEMENTS

The researchers would like to thank God for His

unending grace throughout this research. We are

also grateful to Lembang Asri Resort management

for granting the permission to conduct research at

their hotel.

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