Although the effects of intellectual capital on an organization’s competitive advantage are well documented, the mechanisms that explain those effects remain unclear. We propose that intellectual capital is associated with the way problems are identified, which is concerned with enhancing competitive advantage. The results of our study support a structural model whereby the indirect effects of intellectual capital on a hotel’s competitive advantage are determined through the mechanisms of problem identification. Additional analyses reveal that customer capital is related to structural capital, which predicts the hotel’s human capital. Furthermore, the process-oriented view indicates that innovative ability mediates the effects of ability capital on competitive performance.

Introduction

The combination of global trends and a highly competitive business environment has led to the increased importance of creating and maintaining a competitive advantage in the tourism and hospitality industry (Casanueva et al., 2015; Liu and Gan, 2015; Molina-Azorín et al., 2015; Preble et al., 2000). To cope with the dynamic environment and changing customer needs, hospitality organizations must be able to identify and exploit both their internal and external capital and to strengthen their capabilities (Paek et al., 2015). Intellectual capital refers to value of the firm’s knowledge base and service capabilities, which is the most efficient, albeit challenging, vehicle for internalizing organizational competency, and is a critical attribute of factors that drive hotel profitability and performance (Enz et al., 2006a,b). However, to date, few studies have addressed the role of intellectual capital in the context of competitive advantage and performance within the hospitality industry setting (Enz et al., 2006a,b; Rudež and Mihalič, ۲۰۰۷). In addition, due to the increasing importance of creating and sustaining a competitive advantage, prior hospitality studies have focused on empirical examinations of the effects of intellectual capital on social network analyses (Hu and Racherla, 2008), knowledge management (Hallin and Marnburg, 2008) and financial performance (Enz et al., 2006a,b; Rudež and Mihalič, ۲۰۰۷). Considerably less literature has addressed intellectual capital as the process by which competitive advantage is achieved (Chen, 2008). Along with a lesser focus on competitive advantage process engagement, the research on intellectual capital has tended to focus almost exclusively on the different constructs of competitive advantage requirements rather than on the financial performance and overall performance. This narrow stance has thus given rise to the question of how the competitive advantage process engagement interfaces with the broader considerations that tend to be part of an organization’s environmental attributes, which include strong intellectual capital components. Drawing on the intellectual capital theory, we further develop this perspective by arguing that intellectual capital is most beneficial to competitive advantage when such engagement is associated with its own problem identification capability. The current study fills gaps in the hospitality literature by developing an integrated process to analyze how hotels may create competitive advantages through text analytics. It allows the resource allocators or policy makers within a focal hotel to identify the critical attribute of intellectual capital and to better understand the internal and external atmosphere of the focal hotel and the industrial environment. More importantly, we make several other contributions.