destination competitiveness

Destination Competitiveness:

Determinants and Indicators

Larry DwyerQantas Professor of Travel and Tourism Economics, University of New South

Wales, NSW, 2052, Sydney, Australia

Chulwon KimProfessor, College of Hotel and Tourism Management, KyungHee University,

Soeul, Korea

The paper develops a model of destination competitiveness that will enable compari-sons between countries and between tourism sector industries. The model seeks tocapture the main elements of competitiveness highlighted in the general literature,while appreciating the special issues involved in exploring the notion of destinationcompetitiveness as emphasised by tourism researchers.Associated with the model is aset of indicators that can be used to measure the competitiveness of any given destina-tion. These indicators, comprising both objective and subjective measures, were iden-tified from the major elements comprising the generic destination competitivenessmodel and also from discussions at workshops held in Korea and Australia.This paperhas four major objectives: to develop a model of destination competitiveness that iden-tifies key success factors in determining destination competitiveness; to develop anappropriate set of indicators of destination competitiveness; to highlight the advan-tages and limitations of the model; and to identify areas for further conceptual andempirical research.The development of a model of destinationcompetitivenessand anassociated set of indicators allows identification of the relative strengths and weak-nesses of different tourism destinations, and can be used by industry and governmentsto increasetourism numbers and expenditure,and enhance socioeconomic prosperity.

Keywords: Tourism industry, destination competitiveness, competitivenessindicators

Introduction

To achieve competitive advantage for its tourism industry, any destinationmust ensure that its overall ‘appeal’, and the tourist experience offered, must besuperior to that of the alternative destinations open to potential visitors. Existingand potential visitation to any destination is inextricably linked to that destina-tion’s overall competitiveness, however that is defined or measured.

A major aim of the paper is to develop a model and indicators of destinationcompetitiveness that will enable comparison between countries and betweentourism-sector industries. Since a range of factors influence destination competi-tiveness, including price and non-price factors, there is a need to develop indica-tors which reflect this. The development of a set of competitiveness indicatorswould serve as a valuable tool in identifying what aspects or factors influencetourists in their decision to visit other countries. The development of an associ-ated set of indicators will allow identification of the relative strengths and weak-nesses of different tourism destinations, and can be used by industry and

1368-3500/03/05 0369-46 $20/0 © 2003 L. Dwyer & C. KimCurrent Issues in Tourism Vol. 6, No 5, 2003

369

Destination Competitiveness: Determinants and Indicators

Ninna Durinec

governments to increase tourism numbers, expenditure, economic impacts, andquality of life for residents.

This paper has four major objectives:

´ to develop a model of destination competitiveness that identifies keysuccess factors in determining destination competitiveness;

´ to develop anappropriate set of indicatorsof destination competitiveness;´ to highlight the advantages and limitations of the model; and´ to identify areas for further research.

The paper proceeds as follows: first, a review of the literature on ‘competitive-ness’ is undertaken. While the frameworks of competitiveness appearing in thewider literature are useful in highlighting the various determinants of ‘firm’ or‘national’ competitiveness they do not address the special considerations rele-vant to determining ‘destination’ competitiveness.

Second, a review of the literature on tourism destination competitiveness isundertaken. It is argued that none of the models of destination competitivenessthat have been proposed to date are entirely satisfactory. In particular, they donot provide a comprehensive treatment of the various issues surrounding thenotion of ‘competitiveness’ that are being explored in the wider literature andthat must be taken into account in developing a comprehensive framework ofdestination competitiveness.

Third, a model of destination competitiveness is developed. The model seeksto capture the main elements of competitiveness highlighted in the general litera-ture, while appreciating the special issues involved in exploring the notion ofdestination competitiveness as emphasised by tourism researchers.

Fourth, a set of indicators is developed to measure the competitiveness of anygiven destination. These indicators comprise both objective and subjectivemeasures and are identified from the major elements comprising the genericdestination competitiveness model and also from discussions at workshops heldin Korea and Australia.

Fifth, the advantages and limitations of the model are highlighted, and issuesfor further research are explored.

Perspectives on ‘International Competitiveness’

The notion of destination competitiveness should be consistent with thenotion of ‘competitiveness’ in the international economics and internationalbusiness literature. Accordingly, the literature on international competitivenesswas critically reviewed with a view to developing a framework suitable fortourism research.

Although it is widely acknowledged that economic growth and competitive-ness involve a complex interactive process of social, political, and institutionalchange, no one general theory supports this phenomenon. Rather, variousexplanations have been offered from different disciplines. The literature revealsa variation in perspective in defining, understanding, and measuring competi-tiveness. Perspectives from various disciplines reveal that competitiveness is amulti-faceted concept. We canregard the notion of competitiveness as associatedwith three major groups of thought. These are:

370 Current Issues in Tourism

(1) Comparative advantage and/or price competitiveness perspective (Bellak,1993; Cartwright, 1993; Durand & Giorno, 1987; Fagerberg, 1988; Fakiolas,1985; Hilke & Nelson, 1988; Hodgetts, 1993; Porter, 1990; Rugman, 1991;Rugman & D’Cruz, 1993).

(2) A strategy and management perspective (Day & Wensley, 1988; D’Cruz &Rugman, 1993;Ghoshal & Kim, 1986; Grant, 1991; Kogut, 1985;Mahmoud etal., 1992; Mahoney & Pandian, 1992; Mathur, 1992; Parsons, 1983; Peters,1988; Porter, 1985, 1990, 1999; Porter & Millar, 1985; Powell, 1992a, 1992b;Yip, 1989).

(3) A historical and socio-cultural perspective (Aaker, 1989; Franke et al., 1991;Hofstede, 1980,1983;Hofstede& Bond,1988;Kennedy, 1987;Porter et al., 2001)

While economists have placed emphasis on price and the country-specificeconomic characteristics of competitiveness, the management and strategyresearchers have focused on the firm-specific characteristics, while the focus ofsociologists and political theorists has been on various social, political andcultural characteristics underlying the notion of competitiveness. Moreover,each group has suggested different indicators to explain or measure competitive-ness (Moon & Peery, 1995; Waheeduzzaman & Ryans, 1996).

The definitions offered in the literature provide both a micro and a macroconnotation of ‘competitiveness’.

From a macro perspective, competitiveness is a national concern and the ulti-mate goal is to improve the real income of the community. On this perspective,competitiveness is a very broad construct encompassing all social, cultural, andeconomic variables affecting the performance of a nation in internationalmarkets. Reflecting this macro perspective, competitiveness may be defined as

the degree to which a country can, under free and fair market conditions,produce goods and services which meet the tests of international marketswhile simultaneously maintaining and expanding the real incomes of itspeople over the longer term (Global Competition: The New Reality. Report onthe President’s Commission on Industrial Competitiveness, 1985).

On the other hand, from a micro perspective it is seen as a firm-level phenome-non: firm-specific behaviours determine competitiveness. Porter’s competitiveanalysis framework (Porter, 1980) emphasises industry attractiveness and itscharacteristics, such as the potential to enhance the firm’s power vis à vis buyersand suppliers, thwart potential entrants and outposition competitors, as beingthe key determinants of competitive advantage and long-term profitability. Bycontrast, the ‘resource-based’ approach emphasises that the roots of competitiveadvantage reside in the acquisition and maintenance of the core competencies ofan organisation. ‘Resource-based’ theorists have emphasised inimitable firm‘resources’ and the distinctive capabilities and competencies resulting fromcombining these resources as being central to obtaining a sustainable competi-tive advantage (Barney, 1991; Grant, 1991; Prahalad & Hamel, 1990). Barney(1991)defines a firm’s sustained competitiveadvantageas the implementation ofa value-creating strategy not simultaneously being implemented by any currentor potential competitors and when these competitorsare also unable to duplicatethe advantages based on such a strategy. Core competence provides potential

Destination Competitiveness: Determinants and Indicators 371

access to a wide variety of markets, makes a significant contribution to theperceived customer benefits of the end products, and is difficult for others toimitate. Core competencies are sustained through somekind of ‘isolating mecha-nisms’ maintained by firms (Prahalad & Hamel, 1990; Rumelt, 1984).

On the micro perspective, in order to be competitive, any organisation mustprovide products and services for which customers or clients are willing to pay afair return or price. In the long run, in a free enterprise system, competitiveness ismeasured by the ability of the organisation to stay in business and to protect theorganisation’s investments, to earn a return on those investments, and to ensurejobs for the future.

Thus, despite the extensive literature on competitiveness, no clear definitionor model has yet been developed. It is a complex concept because a whole rangeof factors account for it. Competitiveness is both a relative concept (i.e. comparedto what?) and is multi-dimensional (i.e. what are the salient attributes or qualitiesof competitiveness?) (Spence & Hazard, 1988). On both the micro and macroperspectives there is recognition that firms and nations face very different chal-lenges and priorities as they move from resource-based to knowledge-basedeconomies. Thus, the principal factors that contribute to global competitiveness,and thereby improve living standards, will differ for economies at differentlevels of development (Porter et al., 2001).

Regardless of the specific definitions offered, the notion of competitivenessdoes, however, appear to be centred on human development, growth andimproved quality of life (Newall, 1992). For a company, competitiveness meansthe creation of new growth options that create value for shareholders. For asociety, improved competitiveness translates into new jobs and better livingconditions (World Economic Forum, 2001). Wealth creation is the engine ofeconomic growth and a mainspring of innovation. The ultimate goal of competi-tiveness is to maintain and increase the real income of its citizens, usuallyreflected in the standard of living of the country. From this perspective, thecompetitiveness of a nation is not an end but a means to an end; its ultimate goalis to increase the standard of living of a nation under free and fair market condi-tions (through trade, production, and investment) (Cho, 1998).

Lessons from the wider literature

While the discussions of competitiveness in the general literature are useful inhighlighting the various determinants of ‘firm’ or ‘national’ competitiveness,they do not address the special considerations relevant to determining tourism‘destination’ competitiveness. The discussion of competitiveness in the generalliterature has tended to stress competitive advantage (resulting from value-addedactivities by firms and organisations), while de-emphasising comparative advan-tage as a source of international competitiveness. For a tourism destination,comparative advantage would relate to inherited or endowed resources such asclimate, scenery, flora, fauna, etc., while competitive advantage would relate tosuch created items as the tourism infrastructure (hotels, attractions, transportnetwork), festivals and events, the quality of management, skills of workers,government policy and so on. Since the core attractive resources that a destina-tion possesses do not necessarily suffer depletion, despite the fact that peoplehave paid for their use, ‘the tourism phenomenon represents a fundamentally


different form of economic exchange than does the sale of physical resources’(Ritchie & Crouch, 1993: 35–6). In the context of tourism, both comparativeadvantage and competitive advantage are important and a model of destinationcompetitiveness must recognise this.

A major reason for attempting to develop a model of competitiveness thatfocuses specifically on the tourism sector is that there appears to be a fundamentaldifference between the nature of the ‘tourism product’ and the more traditionalgoods and services for which the above models were developed. In contrast to aspecific manufactured product, for example, a tourism destination may beregarded as ‘an amalgam of individual products and experience opportunitiesthat combine to forma totalexperience of the areavisited’ (Murphy et al., 2000:44).

It is appropriate to inquire, however, as to the lessons that can be learned fromthe competitiveness literature in developing a framework of destination compet-itiveness.

Price competitiveness

From the literature on comparative advantage and price competitivenesscomes recognition of the potential importance of destination price competitive-ness in influencing visitor flows. Studies by tourism researchers indicate theprice sensitivity of travellers is high in certain markets (Lee et al., 1996).Empiricalstudies highlight the importance of levels of technology, exchange rates, govern-ment policies, industry competition, and the influence of multinational enter-prises as factors influencing the price competitiveness of tourism firms (Dwyer,Forsyth & Rao, 2000a,b, 2002).

Firm-specific factors

From the strategy and management perspective comes a recognition of theimportance of the firms’ resources in influencing the achievement and mainte-nance of sustainable competitive advantage. The basic premise is that thecompetitiveness of a nation stems from companies within that nation, sofirm-specific factors that lead to competitiveness should be identified. In order toachieve competitive advantage, the focus should be on the ‘development andmaintenance of meaningful assets and skills, the selection of strategies andcompetitive arenas to exploit such assets and skills and neutralising of competi-tors’ assets and skills’ (Aaker, 1989: 105). Resources of the firm that are consid-ered to offer competitive advantage include: the skills of the employees, assets,cash-flow, capital/investment (human, non-human and strategic), structure ofthe organisation (flexibility, balance, and dynamic aspects), organisation-environmental interface (source and positional advantage, organisational align-ment, generic strategy, strategic planning, and customer-oriented offering), andmany firm-specific variables (core competencies, imitability of products, infor-mation, intelligence system, value added by the firm, and quality). Day andWensley (1988) have argued that competitive superiority results from thepossession of ‘source’ and ‘positional’ advantage. Source advantage refers to thebasic ability of the organisation that may come from superior skill (humanresources), superior non-human resources or a combination of the two. Posi-tional advantage is a more market-oriented phenomenon. In order to be competi-tive a firm needs to manoeuvre both source and positional advantage. Since thecompetitiveness of a destination must somehow be essentially linked to the


competitiveness of its constituent firms, these variables must be recognised in amodel of destination competitiveness.

Cultural and related factors

From the literature on history, politics and culture comes a recognition that,just as the competitiveness of nations can be influenced by climate, morals,power of the state, cultural values and moral discipline, so too may destinationcompetitiveness be influenced by such variables (Franke et al., 1991; WorldEconomic Forum, 2001).

Subjective factors

From the attempts to develop indicators of national competitiveness such asthose developed by the World Economic Forum (2001) comes a recognition ofresident prosperity as the end result of competitiveness and the importance ofconsumer perceptions of competitiveness. That is to say, not all the influences oncompetitiveness are objectively quantifiable. In the tourism context an importantdistinction will involve the reality of the situation, as indicated in objectivemeasures of competitiveness (e.g. measures of price competitiveness, crimestatistics involving tourists as victims), and traveller’s perceptions (e.g. percep-tions of relative price levels, perceptions of safety/security, views about comfortlevels and the aesthetic appeal of different types of tourism resources). Indeed,the importance of tourists’perceptions is such as to warrant separate recognitionin a model of destination competitiveness.

Perspectives on Destination Competitiveness

Destination competitiveness would appear to be linked to the ability of adestination to deliver goods and services that perform better than other destina-tions on those aspects of the tourism experience considered to be important bytourists. Dwyer, Forsyth and Rao (2000a) state that ‘tourism competitiveness is ageneral concept that encompasses price differentials coupled with exchange ratemovements, productivity levels of various components of the tourist industryand qualitative factors affecting the attractiveness or otherwise of a destination’(Dwyer et al., 2000a: 9).

Recently, two international tourism journals have devoted entire issues to thetheme of destination competitiveness. The journal Tourism in a special issue,Competitiveness in Tourism and Hospitality (Volume 47 (4), 1999), featured articleswhich addressed price competitiveness by journey purpose (Dwyer et al.), theinternational competitiveness of Croatia’s hotel sector (Cizmar & Seric;Osmagic-Bedenik); the role of public administration in the competitiveness ofSpain’s tourism industry (Bueno); and the competitiveness of Alpine destina-tions (Pechlaner). The journal Tourism Management, in its special issue TheCompetitive Destination (Volume 21 (1), February 2000), included articles thataddress destination price competitiveness (Dwyer et al.), competitiveness vari-ables in the area of destination policy, planning and management (Crouch &Ritchie), overall destination competitiveness (Buhalis; d’Hauteserre; Go &Govers), competitiveness and transport (Prideaux), and competitiveness and theenvironment (Mihalic).

A large number of variables appear to be linked to the notion of destination


‘competitiveness’. These include objectively measured variables such as visitornumbers, market share, tourist expenditure, employment, value added by thetourism industry, as well as subjectively measured variables such as ‘richness ofculture and heritage’, ‘quality of the tourism experience’ etc. Thus, for example,competitiveness has been defined as ‘the ability of a destination to maintain itsmarket position and share and/or to improve upon them through time’(d’Hartserre, 2000: 23). Hassan defines competitiveness as ‘the destination’sability to create and integrate value-added products that sustain its resourceswhile maintaining market position relative to competitors’ (Hassan, 2000: 239).

According to other researchers, destination competitiveness is associatedwith the economic prosperity of residents of a country (Buhalis, 2000; Crouch &Ritchie, 1999). This is consistent with the view espoused by the World EconomicForum (Porter et al., 2001).Development designed to attract international visitorsmay have a range of purposes. Ultimately, however, it seems reasonable to focusattention on economic prosperity. That is, nations (or destinations) compete inthe international tourism market primarily to foster the economic prosperity ofresidents. Other objectives may hold, of course – the opportunity to promote thecountry as a place to live, trade with, invest in, do business with, play sportagainst, etc. Tourism may foster international understanding, peace, and good-will. But, in long term, the economic well-being of residents is of central concernto the notion of destination competitiveness.

Although the end result of achieving destination competitiveness might wellbe enhanced economic prosperity for residents, it should be emphasised that thelink between tourism market share and economic contribution is not alwaysobvious. Thus recent studies of tourism’s economic contribution to an area usingComputable General Equilibrium modelling reveals that the expansion oftourism will often ‘crowdout’ other economic sectors,resulting in a change in thecompositionof industry rather than an expansion of economic activity (Adams &Parmenter, 1992; Dwyer & Forsyth, 1998; Dwyer, Forsyth, Madden & Spurr,2000; Dwyer, Forsyth & Spurr, 2003). More specifically, the economic impact oftourism will depend upon variables over and above market share, including aneconomy’s situational conditions such as factor constraints, industry structure,profile of traditional exports and import-competing industry, exchange rateregime and current government macroeconomic policy stance (fiscal, monetary,labour market) (Dwyer et al., 2000).

Poon (1993) suggests four key principles which destinations must follow ifthey are to be competitive: put the environment first; make tourism a leadingsector; strengthen the distribution channels in the market place, and build adynamic private sector. Clearly these principles are too broad and general to bemeaningful to tourism stakeholders and policy makers. Go and Govers (1999), ina study of conference site selection, measure a destination’s competitive positionrelative to other destinations along seven attributes: facilities, accessibility,quality of service, overall affordability, location image, climate and environ-ment, and attractiveness. The selected attributes appear not to be based on anymodel of competitiveness and, in any case, apply specifically to the conventionssector of tourism.

Dwyer et al. (2000a,b; 2002) have provided the most detailed study of tourismprice competitiveness published to date. Measures of price competitiveness may


be expected to play an important part in any framework of overall price andnon-price tourism competitiveness. Hassan has recently introduced a newmodel of competitiveness that focuses on environmental sustainability factorsassociated with travel destinations (Hassan, 2000). Hassan posits four determi-nants of market competitiveness. These are: comparative advantage (includes thosefactors associated with both the macro and micro environments that are criticalto market competitiveness); demand orientation (the destination’s ability torespond to the changing nature of the market demand); industry structure (exis-tence or absence of an organised tourism-related industry); and environmentalcommitment (the destination’s commitment to the environment). Underlying hismodel is a conviction that ‘a global perspective to understand key determinantsof market competitiveness is critical for the tourism industry to sustain itsgrowth and vitality’ (Hassan, 2000: 239).

The mostdetailed workundertaken by tourism researchers on overall tourismcompetitiveness is that of Crouch and Ritchie (1995, 1999) and Ritchie andCrouch (1993, 2000). They examined the applicability to tourism destinations ofcompetitiveness research and models in other contexts spanning companies andproducts, national industries, and national economies, as well as competitive-ness related to service industries. They claim that, in absolute terms, the mostcompetitive destination is one which brings about the greatest success; that is,the most well-being for its residents on a sustainable basis. And that ‘competi-tiveness is illusory without sustainability’ (Ritchie & Crouch, 2000:5).They claimthat ‘to be competitive, a destination’s development of tourism must be sustain-able, not just economically and not just ecologically, but socially, culturally andpolitically as well’ (5). Ritchie and Crouch focus on long-term economic prosper-ity as the yardstick by which destinations can be assessed competitively. Thusthe most competitive destination is that which most effectively creates sustain-able well-being for its residents.

A model of destination competitiveness has been developed by Ernie Heathwho claims that:

existing models do not appear to adequately provide an integrated treat-ment of the various issues surrounding the concept of ‘competitiveness’and do not place sufficient emphasis on the key success drivers (people)and the vital linkages (e.g. communication and information management)that need to be considered when developing a comprehensive frameworkof sustainable destination competitiveness (Heath, 2003).

Heath’s model is presented in the form of a house with foundations, cement,building blocks and roof:

´ The Foundations provide an essential base for competitiveness. Theseinclude: Providing and Managing the Key Attractors (e.g. history, culture,climate, events, entertainment, etc.); Optimising the Comparative and Compet-itive Advantages; Addressing the Fundamental Non-negotiables (e.g. personal,safety and health issues); Providing the Enablers (e.g. infrastructure(airports, roads, signage, etc.), managing capacity); Capitalisingon the ‘ValueAdders’ (e.g. location,value, and destination linkages); Ensuring AppropriateFacilitators (e.g. appropriate airline capacity, accommodation, distribution


channels, etc.); Focusing on the Experience Enhancers (e.g. hospitality, serviceexcellence, authentic experiences).

´ The Cement binds and links the respective facets of competitiveness. Theseinclude continuous and transparent communication channels; balancingdirect and indirect stakeholder involvement and beneficiation; informationmanagement, research and forecasting; managing competitive indicatorsand benchmarks.

´ The Building Blocks are essential to make tourism ‘happen’ in a destination.These include a Sustainable Development Policy and Framework (policy andlegislative framework, organisational and financing framework, resourcesand capabilities, investment climate, sustainable environmental princi-ples) and a Strategic and Holistic Destination Marketing Framework and Strat-egy (destination image and branding, competitive positioning, targetmarketing/demand management, innovative marketing strategies, visitorsatisfaction management).

´ The Roof (the key success drivers) comprises the ‘people’ part of destinationcompetitiveness. These include a shared tourism vision and leadership,guiding values and principles, placing strategic priority on the ‘people’factor (political will, entrepreneurship, community focus and humanresources development).

A model of destination competitiveness has been developed by the presentauthors. This model is displayed schematically in Figure 1. The model bringstogether the main elements of national and firm competitiveness as proposed inthe wider literature and the main elements of destination competitiveness asproposed by various tourism researchers, Crouch and Ritchie in particular. Theintegrative model proposed here contains many of the variables and categoryheadings identified by Crouch and Ritchie (1995, 1999) and Ritchie and Crouch(1993, 2000) in their comprehensive framework of destination competitiveness,but differs some important respects. The present model explicitly recognisesdemand conditions as an important determinant of destination competitiveness. Italso explicitly recognises that destination competitiveness is not an ultimate endof policy making but is an intermediate goal towards the objective of regional ornational economic prosperity.

In Figure 1, the Resources category is divided into two types: Endowed (inher-ited) and Created. Endowed Resources, in turn, can be classified as Natural(mountains, lakes,beaches, rivers, climate etc.) andHeritage or Cultural (cuisine,handicrafts, language, customs, belief systems etc.). Created Resources includetourism infrastructure, special events, the range of available activities, entertain-ment and shopping. In the model presented here, Supporting Resources (orenabling factors) include general infrastructure, quality of service, accessibilityof destination, hospitality and market ties. Endowed and Created Resources areeach allocated their own box, as is Supporting Factors and Resources. As Crouchand Ritchie state, ‘Whereas the core resources and attractors of a destinationconstitute the primary motivations for inbound tourism, supporting factors andresources exert more of a secondary effect by providing a foundation uponwhich a successful tourism industry can be established’ (1999: 148). Theseinclude general infrastructure, quality of service, accessibility of destination,


Des

tina

tion

Man

agem

ent

Res

ourc

esG

over

nmen

tIn

dust

ry

Endo

wed

Res

ourc

es

Nat

ural

Her

itage

Cre

ated

Res

ourc

es

Supp

ortin

gR

esou

rces

Situ

atio

nal

Con

ditio

ns

Dem

and

Des

tinat

ion

Com

petit

iven

ess

Indi

cato

rs

Qua

lity

ofLi

feIn

dica

tors

DestinationCompetitiveness

SocioeconomicProsperity

Figu

re1

The

mai

nel

emen

tsof

dest

inat

ion

com

petit

iven

ess


hospitality and market ties. In the integrated model presented here, these threeboxes are, in turn, grouped within a larger box, indicating that destinationcompetitiveness depends on the value added to core resources by these otherfactors.

Situational Conditions are forces in the wider external environment that impactupon destination competitiveness. Situational conditions relate to economic,social, cultural, demographic, environmental, political, legal, governmental,regulatory, technological, and competitive trends and events that impact on theway firms and other organisations in the destination do business, and presentboth opportunities and threats to their operations (David, 2001). These condi-tions correspond to the Qualifying and Amplifying determinants as identified byCrouch and Ritchie (1999). For present purposes it is useful to regard the situa-tional conditions as falling within one of two interactive and interrelatedcontexts of organisations operating in the destination – the operating environ-ment and the remote environment. The operating environments of the differentprivate- and public-sector institutions in a destination are important because, toa large extent, the conduct and performance of these institutions depends on theoverall structure of the industry in which they are situated (McGee, 1988; Porter,1980, 1990). The remote environment comprises those forces and events outsidethe destination that constrain the strategic options of organisation managers butover which management have no control (Johnson & Scholes, 1997: 89; Tribe,1999: 158).

Destination Management factors are those that ‘can enhance the appeal of thecore resources and attractors, strengthen the quality and effectiveness of thesupporting factors and resources and best adapt to the constraints imposed bythe [situational conditions]’ (Crouch & Ritchie, 1999: 149). The category includesthe activities of destination management organisations, destination marketingmanagement, destination policy, planning and development, human resourcedevelopment and environmental management (Ritchie & Crouch, 2000). In themodel presented here, a distinction is made between destination managementactivities undertaken by the public sector and Destination Management under-taken by the private sector. Included among the activities of the public sector wewould find the development of national tourism strategies, marketing by theNTO, national and regional manpower programmes, environmental protectionlegislation etc. Included among the activities of the private sector we would findthose of tourism/hospitality industry associations, industry involvement in andfunding of destination marketing programs, industry training programmes,industry adoption of ‘green’ tourism operations and so on.

The model contains a separate box for Demand Conditions. This categorycomprises three main elements of tourism demand-awareness, perception andpreferences. Awareness can be generated by various means including destina-tion marketing activities. The image projected can influence perceptions andhence affect visitation. Actual visitation will depend on the match betweentourist preferences and perceived destination product offerings. A destination’sproduct must develop in a way that ‘matches’ the evolving consumer prefer-ences, if the destination is to enhance or even maintain competitiveness.

The single direction arrows from Supporting Resources to EndowedResources and Created Resources indicates that the mere existence of such


resources is insufficient to generate visitation to a destination in the absence oftourism infrastructure (accommodation, transportation, restaurants), organisedactivities, entertainment, shopping and so, on which enable or facilitate visita-tion. Such attributes represent ‘value added’ by organisations in the destinationto the overall tourism product.

There are two-directional arrows linking both Created Resources andSupporting Resources to Demand and to Destination Management. Thesearrows indicate a two-way causal link. Thus, specific features of CreatedResources and Supporting Resources influence Demand, whilst the nature ofDemand Conditions, specifically tourist preferences and motives for travel,influence the types of products and services developed within a destination. Insimilar vein, specific features of Created Resources and Supporting Resourcesinfluence Destination Management to achieve and maintainsustainability whilstthe activities of public- and private-sector tourism organisations influence typesof products and services developed.

The box representing Destination Competitiveness is linked backwards to thevarious determinants of competitiveness and forwards to one representingSocioeconomic Prosperity, indicating that destination competitiveness is itself anintermediate goal towardsa more fundamental aim of socioeconomic well-beingfor residents. Each of these objectives is associatedwith a set of indicators. Indica-tors of destination competitiveness are many and varied and comprise bothsubjective attributes (destination ‘appeal’, ‘scenic beauty’) as well as those thatare more objectively determined (destination market share, foreign exchangeearnings from tourism). Indicators of Socioeconomic Prosperity relate to keymacroeconomic variables including productivity levels in the economy, aggre-gate employment levels, per capita incomes, rate of economicgrowth andso on.

We now discuss the various elements of the integrative model.

Core Resources

Included under this heading are various characteristics of a destination thatmake it attractive to visit. Crouch and Ritchie regard core resources and attrac-tors as ‘the primary motivation for destination appeal’ (Crouch & Ritchie, 1999:146). Of course, different resources have different appeal to different tourists.Tourist motivationscan be classified in several ways, and core resources are onlya ‘pull factor’ for some types of tourism.

Resources can be divided into two types: endowed (inherited) resources andcreated resources.

Endowed resources

Natural resources

The natural resources of a destination define the environmental frameworkwithin which the visitor enjoys the destination. They include physiography,climate, flora and fauna, scenery and other physical assets.

While Porter and others have emphasised ‘factor creation’ as a source ofcompetitive advantage, a destination’s endowment of natural resources iscrucial for many forms of tourism and visitor satisfaction(Buckley, 1994;Dunn &Iso-Ahola, 1991). While in the context of manufacturing competitiveness


emphasised by management theorists resource disadvantages can be overcomeby adding value to the goods and services produced, in the tourism contextnatural resources have a substantial capacity to attractvisitors, regardless of any‘value added’ by human providers.

Heritage and Culture

The heritage and culture of a destination, its history, institutions, customs,architectural features, cuisine, traditions,artwork,music, handicrafts,dance etc.,provides a basic and powerful attractingforce for the prospective visitor (Cohen,1988; Murphy et al., 2000; Prentice, 1993). Past research has examined the greatnumber of dimensions of culture that enhance the attractiveness of a tourismdestination (Ritchie & Zins, 1978).

We know that individuals may disagree in their perceptions of the same‘objective’ reality (Carroll & Chang, 1970; Wish, 1971). Similarly, there may bedifferences between the way in which industry views the ‘richness’ of culture asopposed to how consumers perceive it. As Ritchie, Crouch and Hudson (2000)point out in an example, merely counting of museums and historic sites, while ofsome help in measuring a destination’s heritage endowment, may well mask thequality of these attractions.

Created resources

Porter (1990) and others note that strengths in other parts of ‘the diamond’ canovercome factor disadvantages. The literature search undertaken in the presentstudy revealed the importance of ‘created resources’ in determining firm ornational competitiveness. There would seem to be at least five types of ‘created ‘or ‘built’ resources that influence destination competitiveness: tourism infra-structure, special events, range of available activities, entertainment and shop-ping. Of course, many cultural/heritage attractions of a destination may be‘created’ or ‘built’ (e.g. the Great Wall of China, the Taj Mahal), but these historicsites are more appropriately regarded as comprising elements of destination(inherited) culture and heritage.

Tourism infrastructure

Tourism infrastructure includes features such as accommodation facilities,food services, transportation facilities, themed attractions, fast food outlets,taverns/bars and receptive tourism plant, tour wholesalers, tour operators,travel agents, car rental firms, local convention and visitorbureaux. Tourism alsorelies on the provision of numerous ancillary services. Related services infra-structure includes retail shopping facilities, food stores, garages (car mainte-nance, petrol stations), pharmacies, bookstores/newsagents/kiosks, laundries,hairdressers, administrationoffices (police, courts etc.). In the eyes of many tour-ists, and certainly for so-called ‘mass tourism’, destinations function more effec-tively when these services are abundant. Mo et al. (1993) have argued thatdestination service infrastructure is, after ‘destination environment’, the mostimportant factor in an international tourist’s experience of the destinationproduct. Murphy et al. (2000) found that the level or lack of infrastructure affectstourist experiences and that ‘tourism infrastructure’ is an important predictor ofboth destination ‘quality’ and perceived trip ‘value’. This does not, of course,deny the existence of those forms of tourism (nature-based, cultural/heritage,


adventure tourism etc.), in which the tourism experience is enhanced by the lackof created tourism infrastructure. This reinforces the importance of the demandside as a determinant of destination competitiveness (see below).

Special events

This category is intended tocapture thosehappenings where thevisitor tends tobe highly involved as a participant (e.g. a MardiGras, a World Fair) or thoseeventswhere simply ‘being there’ is significant (royal weddings, papal coronations, theinvestiture of a world leader, Wimbledon tennis). The capacity of special events togenerate tourism expenditure is well documented although the economic impactsand net benefits are often exaggerated (Dwyer, Forsyth, Spurr & Ho, 2003). Festi-vals and events are recognised internationally as making a valuable economiccontribution to tourism destinations, and also as having significant growth poten-tial. Economic impacts include the contribution to employment and income,nationally and regionally. Events tourism is also regarded as associated with arange of other benefits (and costs)of a more ‘intangible’ nature that impact on localcommunities as well as entire regions. These include associatedsocial and culturalbenefits to adestination, theexchange of ideas, fostering business contacts,provid-ing fora for continuing education and training, facilitating technology transfer andso on (Dwyer, Mellor, Mistilis & Mules, 2000).

Range of available activities

The mix of activities possible within a destination are important tourismattractors. These can include recreation and sports facilities – summer facilities(golf, tennis etc); winter facilities (skiing); water sports (swimming, boating,fishing); night clubs/night life; facilities for special interest visitors such asadventure tourists, ecotourism, cultural/heritage tourism and biking trails.

The more diversified a destination’s portfolio of tourism products, servicesand experiences the greater is its ability to attract different tourist marketsegments. A climate of competition stimulates improvement and discouragesstagnation. For example, the continuing development and expansion of LasVegas casinos and more recent diversification beyond gambling to encompass abroader range of entertainment and family-oriented activities has enabled LasVegas to continue to evolve and develop as a destination. Moreover, a destina-tion’s seasonal constraints may be partly overcome when tourism enterprisesexpand the range of seasonal experiences available.

Entertainment

This category primarily encompasses behaviours where the visitor assumes arather passive ‘spectator’ role such as the theatre and film festivals (Crouch &Ritchie, 1999). Entertainment can be found in many forms. From a consumerperspective, the amount of entertainment available at a destination is probablyless important than its perceived quality or uniqueness. Even more important fordestination competitiveness is the degree to which the entertainment offeringsare ‘appropriate’ to the destination. Ritchie, Crouch and Hudson (2000) cite theOberammergau Passion Play as uniquely associated in the consumer’s mindwith the destination, even though it could be staged practically anywhere. Theythus claim that the competitiveness value of this event exceeds its entertainmentvalue as a mere ‘religious’ event (11).


Shopping

Shopping can be regarded as a form of entertainment or, possibly, a necessarychore for many tourists. For some cultures, e.g. Japanese and Koreans, gift givingupon returning home is an important element of the entire travel experience(Hobson, 1996). In various parts of the world, the opportunity to shop forduty-free items has provided, in itself, a major motive for travel. For many tour-ists, the opportunity to shop in an exotic location, or ‘duty free’, is an important‘pull factor’ of outbound travel. Destinations such as Hong Kong and Singaporehave at times marketed themselves as ‘shopover’ destinations. Over 50% ofvisitor expenditure in Singapore is on shopping items (Singapore TourismBoard, 2000).

Given the importance of shopping in tourist expenditure generally, and in thepurchasing behaviour of Asian tourists in particular, this category is identifiedseparately in the destination competitiveness model.

Supporting factors and resources

Supporting factors and resources underpin destination competitiveness.Private- and public-sector organisations ‘supporting’ tourism activity thatpossess a collection of specific skills not easily imitable by rivals can be an impor-tant source of sustained competitive advantage (Barney, 1991; Prahalad &Hamel, 1990).

General infrastructure

A destination’s general infrastructure includes road networks, airports, trainsystem, bus system, water supply, telecommunications, sewerage, health-carefacilities, sanitation, the electricity generation system, financial services, andcomputer services.

Smith (1994) claims that service infrastructure is housed within the largermacro-environment or ‘physical plant’ of the destination, while Watson andKopachevsky (1994) have argued that tourist experiences cannot be properlyunderstood unless we take into account the larger context and setting in whichthese encounters take place. Consumer research on service experiences alsoconfirms this notion (Bittner, 1990).

Quality of service

The service dimension of the tourism experience is vital. Efforts must be madeto ensure quality of service and there is now recognition of the need to take a totalquality of service approach to visitor satisfaction (Go & Govers, 2000). Provisionof reliable and responsive visitor services enhances a destination’s competitiveadvantage. Initiatives to enhance the quality of the experience provided by atourism destination include: establishment of standards for tourism facilitiesand performance of personnel; programmes to objectively and subjectivelymonitor the quality of experiences provided; and monitoring of resident atti-tudes towards visitors and towards development of the tourism sector.

Some researchers stress the relevance to destination competitiveness of theconcept of the integrity of visitor experiences (Go & Govers, 1999).This concept isintended to convey the idea that the quality of the experience actually providedshould be appropriate to the situation and the price charged. It also implies thatthe service provider delivers the quality of experience that is promised to a given


situation since different levels of quality may well be appropriate for a given costlevel in different situations or settings.

The perceived quality of tourism services appears to be crucially linked to thecontext of service experiences (Johns, 1993). In consumer settings, both the focal(service) and the contextual (environmental) dimensions of a product play asignificant role in determining quality (Gotlieb et al., 1994). These findingssupport the view that both the destination’s macro-environment and its servicedimension affect tourist perceptions of quality. Murphy et al., (2000) found that‘destination environment’ in terms of climate, scenery, ambience, friendlinessand, to a lesser extent, cleanliness, is a key predictor of destination ‘quality’.

Destinations have become increasingly reliant on the delivery of quality prod-ucts and services. Since meeting visitor needs and achieving business goals areincreasingly inseparable, a commitment to quality by every enterprise in a desti-nation (public or private) is necessary to achieve and maintain internationalcompetitiveness (Go & Govers, 2000: 80). Indeed, it has been argued that thequality of service production and delivery deserves ‘a comprehensive approachand a definitive integration among its key stakeholders (residents, visitors,trade) and an in-depth knowledge of their needs and expectations’ (Go & Govers,2000:80). The need for integration relates to the network of different organisa-tions that require interaction to cater effectively and efficiently to consumerneeds and expectations and to minimise the potential negative sociocultural,economic and ecological impacts on the host community.

Accessibility of destination

McKercher (1998) demonstrates the link between market access and destina-tion choice. The accessibility of the destination is governed by a variety of influ-ences including the frequency, ease and quality of automobile, air, bus, train, seaaccess; aviation regulations, entry permits and visa requirements; route conces-sions; airport capacities; competition among carriers etc. Visas may be expensivein terms of monetary outlay and/or inconvenient to procure, thus deterring visi-tation.Countries mayalso impose restrictionson outbound travel by residents.

Prideaux (2000: 56) notes that tourist choice between alternative destinationsis influenced by inefficiencies in the transport system such as uncompetitivepractices, safety concerns, comfort levels and journey time.

Ease of access to a destination may be facilitated through upgraded distribu-tion channels or through developing a more extensive network of sales contacts.Improving inter-modal linkages among transportation systems contributes todestination competitiveness. Following the Asian currency crisis in late 1997,Ansett Australia, Qantas and Air New Zealand suspended services to Korea,demonstrating the effect of external variables on destination accessibility.

Hospitality

Hospitality relates to the perceived friendliness of the local population andcommunity attitudes towards tourists. It includes: warmth of reception by localpopulation; willingness of residents to provide information to tourists; attitudestowards tourists and the tourism industry. Tourist guidance and information,including good signage, is important to visitors feeling ‘valued’ by residents of adestination. Resident support for tourism development fosters a competitivedestination. The perceived hospitality of residents is a major social factor


forming part of the macro-environment (Canestrelli & Costa, 1991; Machlis &Burch, 1983).

Market ties

This category includes several dimensions along which a destination estab-lishes and builds linkages with people in origin markets. It includes ethnic tiesunderlying VFR travel business ties, and trade links underlying businesstourism (Dwyer et al., 1995); economic and social ties including ongoing traderelationships, membership of professional and trade associations,historical andrecent immigration flows, common culture and language, common religion.

Some tourism destinations have a dependency on others that is competitive orcomplementary in nature (Ritchie & Crouch, 2000). For example, Macau tourismrelies on tourism flows to Hong Kong, and tourism to Monaco is very dependentupon tourism numbers to the French and Italian Riviera. Similarly, internationaltourism to Tasmania is associatedwith visitor numbers to Australia. This type ofdependency can also be considered as a form of market tie.

Destination Management

Five types of destination management activities have a potentially importantinfluence on destination competitiveness: destination marketing management;destination planning and development; destination management organisation;human resource development; and environmental management.

Destination marketing management

When implementing their marketing activities, destination managementorganisations (DMOs) can contribute to the achievement of sustainable tourismthrough various actions depending on whether their focus is a promotional orfacilitation strategy. The marketing activities of DMOs are mainly centred on thepromotion of the destination as a whole. However, a natural extension of suchefforts is a facilitation role that typically includes collecting, analysing anddisseminating market research data, establishing a representation in the maintarget markets of origin, participating in trade shows, organising and coordinat-ing familiarisation trips and supporting the private sector in the production anddistribution of literature such as information relating to analysis of characteris-tics of key travel markets related to travel volume and associated spending(Lewis et al., 1995).

Hassan (2000) argues that to maintain tourism competitiveness, destinationmanagement should focus on a systematic examination of unique comparativeadvantages that provide a special long-term appeal to the target travel customersegments.He claims that ‘destinationsarewinning competitivebattles by carefulanalysis and response to the core values and needs of the segmented market-place’ (Hassan, 2000: 240).

An important function of destination marketing managers is to create a desti-nation image, that is ‘the sum of beliefs, ideas and impressions that people haveof a place’ (Kotler et al., 1993). Recent research has focused on the meaning andmeasurement of ‘destination image’ (Balogh & Brunberg, 1997).

Uysal et al. (2000) show the importance of positioning, branding, image,


awareness etc, as determinants of destination market share and overall destina-tion competitiveness. They claim that

the challenge of destination marketing is that it is made up of manysuppliers and service producers. Marketing a tourism region involvescomplex and coordinating action among the central attractions (bothpublic and private) that draw tourists to a region, the transportationnetwork to connect visitors to a variety of attractions, the hospitalityservices to fill basic needs while away from home, and information to helptourists meet needs and find their way in a new environment (Uysal et al.,2000: 94).

Enhancing the appeal of a destination involves a programme of marketingefforts designed to influence the decision process of prospective visitors. Theseefforts may focus on increasing awareness of the existence of the destination orimproving the perceptions of the features of the destination to differentdemographic, psychographic and behavioural market segments. Relevant activ-ities include: development of a strong destination image; creation of a high levelof destination awareness and awareness of the destination’s specific productsand service offerings; identification of high yield customer bases; developmentof strong links with tourism wholesalers and retailers; development of attractive,price competitive tour packages tailored to customer needs.

Destination planning and development

Tourism planning takes place on many levels: site, destination, region,national, international. Planning is carried out by different agencies, organisa-tions, and businesses for different purposes and at different scales, possibly withthe aid of external consultants.

In order to protect ecosystems and economic benefits and to distribute thelatter equitably, tourism must be developed and managed within a hierarchy ofcontrols, ranging from the local to the territorial or provincial, to the national,and even to the international level. The responsibilities at each level of controlmust be clearly identified and a process of accountability must be imple-mented. Tourism planning requires an understanding of the meaning ofsustainable development and the guiding values for promoting sustainabletourism. It requires that communities be made to be sufficiently aware of, andto understand, the tourism industry and its impacts as well as the variousprocesses to integrate and engage in participatory planning, consensus build-ing, and conflict resolution among all stakeholders. It is important to considerwhich sustainable development principles can be implemented throughcommunity control and which need to be implemented through controls at ahigher level.

Hassan (2000) maintains that the diversity of industries involved in destina-tion planning and development requires the use of a competitiveness model thatexamines the relationships among all stakeholders involved in creating value-added products to sustain resources while maintaining a market position rela-tive to other competitors. Sustainable development outcomes should be pursuedby tourism businesses, governments, local communities and other stakeholders.The integration and cooperation of organisations and individuals is complex


which is why planning at a holistic level is required. The outcome can be abalance between needed development and economic benefits and social andenvironmental protection.

Destinations require strong, committed, and effective leadership by business,government and community leaders at all levels. A pro-active role, rather than apassive one, is required to ensure that environmental and heritage values arefully sustained. A sustainable tourism industry requires a commitment by allinvolved to sustainable development principles at all stages of development.Only through such widespread commitment can the prerequisite holisticemphasis necessary for long-term integration of social, environmental, andeconomic objectives be attained (Dutton & Hall, 1989).

The destination ‘vision’ provides a direction for development. According toNewsome et al. (2002: 147) ‘the basic task of planning is to visualise the area, thatis the product, as visitorsand managers wish it to be in the future’. Visioning is animportant step in formulating a tourism plan. In the visioning step, communitymembers attempt to look into the future and imagine what they would like theircommunity to be. Such an effort involves identifying what is really valued ordesired and including those elements in the shared image of the community. Theimage can help community leaders decide among alternatives that are likely tolead to the desired future and those that are likely to lead away from it. It helps acommunity decide how much of any type of development will fit within itsvision and determine what levels of change are acceptable.

Once stakeholders have formulated a destination vision they must undertakea critical analysis, or audit, of the destination’s existing tourism resources andcapabilities, as well as the current functioning of its tourism operations (Inskeep,1991). The tourism audit covers the supply side (tourism products and support-ing factors and resources), the demand side (tourist preferences) as well ascommunity attitudes to tourism development. This type of audit is necessary todetermine, in the light of market trends, the strengths and weaknesses of thepresent state of the industry, and to highlight opportunities for tourism develop-ment, and the challenges that must be met for the destination and its componentfirms to achieve and maintain competitive advantage.

The actions of various industry associations, e.g. air transport associations,hotel associations, tour operator associations, restaurant associations, affect thedeployment of tourism resources. These associations may differ in their percep-tions of the ecological, social, and cultural impacts of tourism development.Tourism resources are likely to be used more effectively when the different asso-ciations and industry groups share a common view regarding a destination’sstrategy for tourism development (Inskeep, 1991).

Pechlaner (1999) stresses the need to undertake a ‘future-oriented’ evaluationof a destination’s development. He lists several ‘destination potentials’ includingdestination reputation for responsiveness to tourism demand, and preparednessfor product and market changes. We agree with Pechlaner regarding the need toattend to the dynamics or ‘potentials’ of competitiveness

Destination management organisation

Various areas and levels of government are involved in the promotion,regulation, presentation, planning, monitoring, maintenance, coordination,


enhancement and organisation of tourism resources. As Buhalis notes, destina-tion management organisations (DMOs), which include convention and visitorbureaux, national and regional tourism organisations, ‘have overall responsibil-ity for the entire destination product and through incentives and policies facili-tate the development of products, and create local partnerships for the deliveryof seamless experiences’ (Buhalis, 2000: 108).

Many of the factors underlying destination competitiveness are ‘publicgoods’ and thus government has an important role to play in achieving andmaintaining destination competitiveness (Bueno, 1999; Dwyer & Forsyth,2000). According to Mihalic (2000: 66) ‘a carefully selected and well executedprogram of destination management can serve to improve the tourism compet-itiveness of a destination’.

Three aspects of destination management organisation are especially impor-tant to competitiveness. These are: coordination, the provision of information,and monitoring and evaluation.

Coordination

There is increasing recognition of the importance of broad community partici-pation, of effective coordination and support between all involved parties ascrucial to achievement of sustainable tourism and hence destination competi-tiveness.

The primary function of the DMO is to serve as a coordinating body for themany public- and private-sector organisations involved in tourism (WTO, 1979).In some cases the DMO will also provide the leadership necessary to provideoverall direction for tourism development within the destination. In all cases thefunction is to enable the many parts of the tourism sector to work together, andthus compete more effectively, design and implement public consultationtechniques and processes in order to involve all stakeholders in makingtourism-related decisions. The DMO can improve the management and develop-ment of tourism by ensuring coordinationand cooperationbetween the differentagencies, authorities and organisations concerned at all levels, and that, wheresuch institutions exist, their jurisdictions and responsibilities are clearly definedand complement each other. It can also help to raise awareness of sustainabletourism and its implementation by promoting the exchange of informationbetween governments and all stakeholders on best practice for sustainabletourism, and promote broad understanding and awareness to strengthen stake-holder attitudes, values and actions that are compatible with sustainable devel-opment.

Provision of information

Destinations that gather and use information effectively can improve theircompetitive position. An effective use of information systems can providemanagers with the information required for understanding customer needs, andfor appropriate new product development and marketing by tourism organisa-tions in both the private and public sectors.

Two categories of information are important; first, information that is internalto the destination provides an ability to better manage the performance of thedestination’s product. The better the system of information management, thegreater the ability of firms in a destination to manage different aspects of the


destination product (Faulkner, 1997). Second, research results provide the infor-mation basis to enable a destination to adapt to changing market conditionsthrough its marketing strategy e.g. visitor statistics on patterns of tourist behav-iour, performance measures which identify problems, tourist satisfaction studieswhich identify problems and opportunities, economic, social and environmentalimpacts of tourism development, information which monitors and tracks the atti-tude of the local population towards the tourism. Such information can enhancetheability of tourism stakeholders to forecastdemand toaid long-term planning.

Monitoring and evaluation

Strategic scanning and monitoring of the competitive environment is an inte-gral part of policy and strategy formulation, including the need to systematicallyevaluate the effectiveness of major policies and strategies that have been previ-ously implemented in efforts to enhance destination competitiveness. Faulkner,emphasising the importance of more rigorous and comprehensive approaches toevaluation to provide a more solid foundation for strategic decision making,stresses the importance of the role of market share analysis in the evaluationprocess as a central indicatorof the extent to which national tourism organisationobjectives are met (Faulkner, 1997). Faulkner recommends the exploration ofbetter ways to communicate research findings to enhance their usefulness todecision makers.

Human resource development

The human resource function is critical to the performance of any organisa-tion. Human resources management (HRM) should be an integral part of corpo-rate strategy and not just remain a functional strategy (David, 2001). Theperspective of organisations as knowledge stocks reinforces the importance ofconsidering all employees as making up the ‘organisational brain’. Theresource-based perspective has begun to emphasise increasingly the role thatorganisationalknowledge can play in sustaining a firm’s competitive superiority(Narasimbha, 2000). In a tourism context, Bueno argues that ‘since competitionbetween firms is determined by skills, human resources are a central factor inachieving competitiveness because of the new opportunities brought about bynew technologies and the importance of consumer loyalty in maintaining highdemand (Bueno, 1999: 321).

Workers in organisations that seek to be competitive must be highly skilled,reliable, educated individuals (Duffey, 1988). They must be able to understandand use the new forms of information technology and the information beingmade available, adapt to rapidly changing organisation forms, and work wellwith others. The links between knowledge creation and use and effectivemanagement of the firm’s human resources need further examination.Traininghas an important role to play in the development of the three dimensions oforganisational knowledge: breadth/depth of knowledge, competence, andexploratory/exploitative knowledge (Narasimbha, 2000).

A combination of several different resources may create a sustained advan-tage in a way that cannot be located in those individual resources. The sustainedadvantage comes from the expertise in combining them or co-locating one or afew vital resources in a combination with readily available ones such that it


becomes difficult to identify and duplicate the advantage (Prahalad & Hamal,1990).

The lessons for tourism stakeholders include the need to understand the HRMpractices that strengthen the organisational knowledge – sustained competitiveadvantage relationship, to find out the obstacles that organisationsface in imple-menting those practices, and to formulate programmes to educate and train alltourism stakeholders.

Environmental management

As noted above, destination environment in terms of climate, scenery, ambi-ence and friendliness has been found to be a key predictor of destination ‘quality’(Murphy et al., 2000: 50). Resource stewardship is an increasingly importantfunction of destination managers in both the private and public sectors. Thisrecognises the importance of long-term ‘sustainable competitiveness’ thatacknowledges the stewardship of ecological, social and cultural resources.

In the wider general management literature it is recognised that a firm’s envi-ronmental performance is linked to its economic performance (Porter & Van derLinde, 1995). When economic interests are broadened to include the interests ofother parties, especially future generations, the opportunity to create aggregatevalue becomes more apparent. An intergenerational perspective enables us tosee that in the long run, economic and environmental interests often converge asresources are transferred across generations (Wade-Benzoni, 1999).

The rationale for taking an ‘intergenerational perspective’ to preserve envi-ronmental resources appears to be particularly compelling in the context ofstakeholder strategies to achieve destination competitiveness. Resources mustbe maintained in an appropriate way to guard against undue deterioration andfacilitate their sustainability. As Hassan notes, ‘sustainable development is criti-cal to the conservation of nature and the preservation of indigenous culture’(Hassan, 2000: 239). According to Hassan, it is critical for future destinationdevelopment plans to be compatible with environmental integrity for thetourism industry to maintain its economic viability. All tourism stakeholdershave an important role to play here. As the WTTC notes,

Sustainable travel and tourism development relies upon policies whichsupport harmonious relationships among travelers, local communities, theprivate sector and governments to balance natural, built and cultural envi-ronments with economic growth and stability (WTTC, 2001: 3).

Mihalic claims that destination attractiveness (appeal) and its competitive-ness can be increased by proper management of environmental quality of a desti-nation’ (Mihalic, 2000: 67). She argues that destination competitiveness can beenhanced through such initiatives as codes of conduct, self-developed environ-mental practice, certified or award-based best practice and accreditationschemes. Mihalic argues that:

in many cases environmental objectives and practice must be incorporatedinto the current attitudes, management strategies and methods in order fordestinations to stay competitive maintaining a high level of overall envi-ronmental quality is important for the competitiveness of most types of


tourism destinations and thus a primary concern for destination managers(Mihalic, 2000: 67).

While a concern for the environment may require that the firm redirects itsresources from other profitable opportunities which can lead to a rise in costsandprices and a loss of markets, there is an alternative view that an environmentalpolicy improves competitiveness by pushing firms into developing more effi-cient ways to produce and therefore reduces costs. Some would go so far as toargue that stringent environmental policy is a potent form of industrial policy,and that it provides a double dividend whereby it improves the environmentand competitiveness (Esty & Porter, 2001; Wade-Benzoni, 1999). In the tourismindustry all firms benefit from environmentalpreservation, and the costsof envi-ronmental policy to tourism firms individually may well be substantially belowthe benefits obtained through additional visitor expenditures generated as aresult of maintenance of a clean environment.

It has become increasingly recognised in the general management literaturethat achieving sustainable business activity requires a shift of managementthinking from a ‘compliance’ or ‘reactive’ environmental stance to a more active‘compliance plus’ strategy whereby the environment is placed high on the busi-ness agenda and environmental concerns are integrated into company culture(Wade- Benzoni, 1999). Given the great reliance of tourism stakeholders on envi-ronmental preservation, this strategy would seem to be particularly appropriatefor firms in the tourism industry.

Environmental performance has been found to vary systematically with thequality of a country’s environmental regulatory regime (Esty & Porter, 2001). Asnoted above, destination environment in terms of climate, scenery, ambience,friendliness has been found to be a key predictor of destination ‘quality’(Murphy et al., 2000:50). Of course, we must remainmindful that it is not so muchthe real but the perceived environmental quality (Mieczkowski, 1995) or envi-ronmental image (Okoroafo, 1995) that influences the buying decisions of thepotential visitor. In the tourism context, there is a much more intimate relation-ship between environmental quality and consumer perceptions of the quality ofthe product purchased than is to be found in other industries. Policy makers havelong come to realise that environmental commitment makes good economicsense for the tourism sector. Thus Hassan has claimed that ‘environmentalcommitment will be the forefront issue for the economic revitalization of thetourism industry’ (Hassan, 2000: 244).

Situational Conditions

As noted above, it is useful to classify situational conditions as falling within adestination’s operating (industry) environment or remote environment. Theconduct and performance of constituent institutions depends on the overallstructure of the industry in which they are situated (McGee, 1988; Porter, 1980,1990). The remote environment comprises those forces and events outside thedestination that constrain the strategic options of organisation or destinationmanagers but over which they have no control (Johnson & Scholes, 1997: 89;Tribe, 1999: 158). Situational conditions may enhance or reduce destinationcompetitiveness (Crouch & Ritchie, 1999).


Destination location

Destination location determines the physical distance from markets and mustaffect travel time from origin markets, even allowing for changes in transporta-tion technology. A destination’s location, particularly from major sourcemarkets, has much to do with its ability to attractvisitors.McKercher (1998)notesthat more proximate destinations exhibit a competitive advantage over destina-tions that offer a similar product but are more distant.

Competitive (micro) environment

This includes the components that shape the immediate industrial environ-ment within which firms in the tourism industrymust adapt in order to compete.

A competitive destination depends in part on a local tourism industry consist-ing of numerous alternative suppliers that must survive on the basis of servicesthat are either unique or superior in some way, or available at a lower cost.Competition among firms creates an environment for excellence. For a destina-tion to develop in a sustainable way, business operations must be sustainable.Sustainable development for business means ‘adopting business strategies andactivities that meet the needs of the enterprise and its stakeholders today whileprotecting, sustaining, and enhancing the human and natural resources that willbe needed in the future’ (International Institute for Sustainable Development,1994: 4).

The competitive (micro) environment can be classified in several ways. Oneuseful set of distinctions is that between (1) the capabilities of destination firmsand organisations, the strategies of destination firms and organisations, includ-ing alliance formation, and (3) the competitive environment of firms and organi-sations in the destination.

The capabilities of destination firms and organisations

A firm’s capabilities can be classified in terms of each of the major functionalbusiness areas – management, marketing, finance, production/operations,research and development (David, 2001; Dwyer & Kemp, 2003). Pechlaneremphasises that core products and services based on core competencies are agood basis for destination competitiveness (Pechlaner, 1999: 335). The corecompetencies of suppliers and decision makers, their knowledge and theirdeveloped skills, are those that are difficult to imitate. The appropriate combina-tion of these competencies and skills contributes to a destination’s competitive-ness (Pechlaner, 1999: 339).

In order to maximise the potential strengths of its capabilities, the firm needsto attend to the organisational culture. Aaker (1989) suggests that managementmust identify cultural forces that affect employee roles to achieve organisationaleffectiveness. The importance of organisational culture as a determinant oforganisation performance has been highlighted in studies of the strategicmanagement of resort hotels (Dwyer et al., 1998/9; Kemp & Dwyer, 2001).

The strategies of destination firms and organisations

The health, vitality and sense of enterprise, entrepreneurship, and newventure development in a destination contribute to its competitiveness in avariety of ways. Gilbert (1990), Poon (1993), Porter (1990) and Porter et al. (2001)


all emphasise how a firm can achieve ‘value-competitive advantages’. A healthysystem of enterprise ensures that market gaps and unmet needs remain unrecog-nised and unfilled for only a short period of time. The sustainable business hasinterdependent economic, environmental, and social objectives and under-stands that long-term viability depends on integrating all three objectives in deci-sion making. Rather than regarding social and environmental objectives as costs,a sustainable enterprise seeks opportunities for profit in achieving these goals.

A firm can enhance its competitiveness through specialisation, innovation,investment, risk taking, and productivity improvements (Ritchie & Crouch,2000). To this list we add the importance of adopting ethical business practicesand the formation of strategic alliances.

(1) Specialisation. There is a growing industry trend in many countries towardsdifferentiated new product strategies by tourism organisations to capturedifferent market segments. Ideally, each firm in the tourism industry willseek to develop new products while focusing on its core competencies andexpertise. Buhalis (2000: 107) argues that the utilisation of new technologyprovides the opportunity to customise products according to customers’specific requirements. Concentrating on core functions and outsourcing allperipheral activities to networks of virtual cooperatives should enabledestinations and enterprises to innovate and to adapt to the needs ofconsumers constantly.

(2) Innovation. Local businesses must continue to seek out and implement newtechnologies to improve their productivity (Porter et al., 2001). Poon (1993)argues that ‘flexible specialisation’ or ‘permanent innovative and ceaselesschange’ provides for the demands of the ‘new tourism’. Developments ininformation and communications technology have greatly increased thepotential for collaboration between businesses by making it much easier tointegrate and coordinate network activities. These changes in technologyhave made possible the development of virtual organisations and withthem, enhancement of competitive advantage (Evans et al., 2003), but it is onthe initiative of operators that new technologies are adopted.

(3) Investment. A diversified portfolio of tourism products, services and experi-ences can enhance destination attractiveness and therefore competitive-ness. Investment in new products and services, matched to visitor needs,may help to overcome seasonality constraints. Foreign investment mayenable faster growth of the destination tourism industry to the benefit oflocal stakeholders (Dwyer & Forsyth, 1993, 1994). Key determinants offoreign investment in tourism include ownership, internalisation andlocation advantages. Ownership advantage relates to the market power ofmultinational companies. Internalisation refers to market failures in trad-ing of intangible goods such as knowledge and brands – hence the need toretain direct control of these goods and services in a foreign marketthrough some form of ownership. Location advantages include the attrac-tiveness of an investment area in terms of local physical and humanresources, host government support for inward investment, costs foremploying local factors of production, and the fit between local strategicassets and the foreign firm’s global pool of resources (Dunning, 1992,


1993). Ideally, investors should have a strong commitment to environmen-tal quality and sustainable development (Hassan, 2000: 243).

(4) Risk taking. A nation’s competitiveness is strengthened in the course ofstruggles by entrepreneurs to overcome high risks and maximise returns toachieve competitive advantages over rivals. Risk taking by entrepreneurs isessential if an economy is to move from being Investment Driven to a moreevolved stageof being innovation driven. As Porter et al. (2001)argue, at thisinnovation stage of economic development, global competitiveness is criti-cally linked to high rates of social learning.

(5) Productivity. Following Porter et al. (2001)we can identify ‘productivityvari-ables’ as another set of factors that contribute to the efficiency and effective-ness of a destination. These include variables that are hypothesised todevelop skills and/or conditions that are likely to increase the quantity andquality of output of tourism ‘experiences’ for a given level of resource input.These variables relate to improving the quality of the people providing theexperience as well as the facilities and equipment that assists them in theirefforts. Improved training and better relationships between managementand labour form the basis for increased flexibility of labour that is a criticalcomponent in today’s rapidly changing environment.

(6) Ethical Business Behaviour. Management theorists argue that a healthy corpo-rate culture should cultivate a basic respect for all individuals, andemphasise honesty, fairness, open-mindedness, team spirit, loyalty, dedica-tion, frank and full communication, life-long learning and constantimprovement (Dwyer et al., 1998;Ford & Richardson, 1994).Business opera-tions rest upon a foundation of shared interests and mutually agreed rulesof conduct. Competition takes place in a society that business presumablyboth serves and depends on, and it is only within the bounds of mutuallyshared concerns that competition is possible. The purpose of business hasbeen defined as the satisfactionof public demand; the introduction of inno-vative, more efficient, more cost-effective products to fill a need; and theoptimal, on-going relation between producer and consumer. For businesscompetition to make sense, the larger interests of the consumer and the soci-ety must be kept in mind (Ford & Richardson, 1994).

(7) Alliance Formation. Strategic alliances can enhance the productivity andcompetitiveness of the member organisations (Lewis, 1990; Porter et al.,2001). Go and Govers (1999) claim that ‘partnerships, including private andpublic sector collaboration between destinations, is a prerequisite to main-taining destination competitiveness’. Buhalis states that ‘partnershipsbetween public and private sector and close cooperation between all localsuppliers is the key to the ability of destinations to offer quality products’(Buhalis, 2000: 111). The WTTC strongly advocates partnerships betweenthe private and public sectors as the most effective means of achievingcompetitive travel and tourism development (WTTC, 2001).

As Hassan recognises ‘in the tourism context, the multiplicity of industriesinvolved in creating and sustaining destinations requires the development of acompetitiveness model that examines the extent of cooperation needed for thefuture of competitiveness (Hassan, 2000: 239). He advocates a relationship


approach to promoting destination competitiveness’ through building capaci-ties for partnerships among three key constituencies: the private sector, thepublic sector and non-governmental organisations including citizen groups(Hassan, 2000: 243).

Tourism stakeholders now place on carefully chosen strategic alliances (TIA,1999). Ideally, the DMO will also provide the leadership necessary to provideoverall direction for tourism development within the destination. In all cases, thefunction is to enable the many parts of the tourism sector to work together, andthus compete more effectively (WTO, 1979). The interdependence of businessand mutual self-interest in the success of the destination encourages inter-firmcooperation, e.g. marketing alliances, sectoral associations and managementstructures (McDougall et al., 1994;Porter et al., 2001).Collaborativearrangementsof various types have become an increasingly important strategic method ofdevelopment, particularly in the travel sector of the industry (Evans et al., 2003:250).

As the tourism industry becomes increasingly global, it has become necessaryfor individual firms, as well as destinations, to establish strategic alliances withother organisations and destinations (Heath, 2000). Thus, for example, manynational and international airlines seek to enhance their ability to compete byforming a broad range of working relationships with airlines that complementtheir route structures as well as their marketing and technical capabilities. TheEuropean Tourism Commission conducts joint research on behalf of itsmembers. The cities of Calgary and Fort Worth have established a direct workinglinkage to jointly market their similar products in foreign markets as havePrague, Budapest, and Vienna (Ratz & Puczko, 2000).

The issue of the interdependencies between enterprises and their role in thedestination tourism system is under-researched (Shaw & Williams, 1990). So alsois appraisal of the specific and unique managerial challenges in tourism, particu-larly of the small firm. Alliances differ in their motives, their scope, their struc-tures, their objectives and the ways in which they are managed (Evans et al., 2003:251). Research is needed on the information needs of small firms and the ways inwhich government and industry associations could assist. Unfortunately, verylittle is known about the effectiveness of industrial policy in stimulating thedesired behaviour of entrepreneurs in tourism.

The competitive environment

Competition among firms creates an environment for excellence (Porter,1990). A competitive destination depends in part on a local tourism industryconsisting of numerous alternative suppliers who must survive on the basis ofservices that are either unique or superior in some way, or available at a lowercost.

The relatively low entry barriers, few skills required, and few restrictions orregulations imposed in the tourism industry encourage the proliferation of smallfirms (Sinclair & Stabler, 1997). Small firms tend to display a lack of appreciationof the importance of staff training. Owner managers make bad investment deci-sions. Many have little understanding of how to finance their business decisions.Many fail to recognise their dependency on the competitiveness of the destina-tion as a whole. It appears likely that future economies will consist of ‘virtual


corporations’ involving a network of smaller enterprises. This will have enor-mous implications for destination competitiveness that will depend on the stra-tegic alliances between individual firms.

Global (macro) environment

Tourism is influenced by a range of global forces including laws and regula-tions, growing concern for the environment, restructuring of economies, shiftingdemographics of the marketplace, the increasingly complex technology–humanresource interface, including computerisation. Such forces represent both chal-lenges and opportunities to the tourism industry.

Kotler et al. (1996) propose that six environmental factors shape the (destina-tion) marketplace: demographic, economic, natural, technological, political andcultural factors. These forces are claimed to impinge upon visitor experiencesand sense of a destination. Some researchers use the acronyms PEST or STEEP toclassify the political, economic, environmental, sociocultural and technologicalelements of the external or remote environment (Dwyer & Kemp, 2003; Evans etal., 2003).

The politicaldimension is a key factor that contributes to the nature of the desti-nation product. For example, the political stability, foreign policy or governmentpolicy on important issues such as human rights or democratic elections candetermine tourist perceptions of behaviour (Murphy et al., 2000). The politicaldimension can also influence the nature and form of heritage displays (Teye,1988). Pechlaner argues that political regulations have an effect on destinationcompetitiveness (Pechlaner, 1999: 338). Governments need to streamline andcoordinate regulation to support medium to long-term development and ensurethat the growth of the industry is not inhibited by broader policy developments(WTTC, 2001).

An important economic variable impacting on destination competitivenessincludes the exchange rate, with a direct effect on destination price competitive-ness (Dwyer et al., 2002). Other important economic variables include interestrates that affect the amount of investment undertaken to respond to changingpatterns of tourism demand. The government macroeconomic policy stance canaffect the economic contribution of tourism demand (Dwyer et al., 2000).

Sociocultural and demographic changes have a profound influence on thetravel motivations of people. A necessary requirement for destination competi-tiveness is that there be a ‘fit’ between tourist preferences and the destination’sproduct offerings (Kelly, 1978).

Technological forces represent major opportunities and threats that must beconsidered in formulating strategies (Poon, 1993). Technological change can,inter alia, create new markets, change relative cost positions in an industry,reduce or eliminate cost barriers between businesses, create shortages in techni-cal skills, result in changing values and expectations of employees, managers,customers, and create new competitive advantages. Taking advantage of newtechnologies and the Internet can also enable destinations to enhance theircompetitiveness (Buhalis, 2000: 113). E-commerce capabilities can help boost adestination’s competitiveness because of the efficiencies gained throughInternet technologies. Technology can improve the efficiency of local suppliersand also provide tools for the development and delivery of differentiated


tourism products. Technology can be accessed through licensing, joint ventures,foreign direct investment and imitation (Porter et al., 2001). One of the majorbenefits of IT is the reduction of the dependency of firms on intermediaries forthe distribution of tourism products (Buhalis & Jafari, 1997). The new IT toolsenable smaller players, to compete on an equal footing with larger playersthereby increasing their competitiveness. With new technology and communica-tions, operational costs are reduced and flexibility, interactivity, efficiency,productivity, and competitiveness are enhanced (WTTC, 2001).

The macro competitive strategy of a country either reinforces or nullifies thecompetitive edge of the companies in that destination. Thus there is a very closerelationship between the micro and macro competitive strategies in a country.

Security and safety

Safety and security within a destination can be a critical qualifying determi-nant of its competitiveness. Elements include: political instability/unrest, proba-bility of terrorism, crime rates, record of transportation safety, corruption ofpolice/administrative services, quality of sanitation, prevalence of outbreak ofdisease, quality/unreliability of medical services,and availability of medication(Crotts, 1996). The current world downturn in tourism following the terroristattacks of September 11 is affecting both the volume and pattern of tourismflows. Particular destinations, including the USA and countries in the MiddleEast, are experiencing greater turndowns in visitors than others because ofvisitor safety and security considerations. Issues of security and safety are nowfirmly established as key elements of destination competitiveness.


The financial cost of a tourism experience, in its broadest terms (i.e. includingtransportation costs to and from destination as well as costs incurred within thedestination), influence travel decisions. Price competitiveness indices can beconstructed given information on purchasing power parities and exchange rates(Dwyer et al., 2000a,b; 2002). Some costs are driven by larger socioeconomic andglobal forces, others by government actions (e.g. taxes), while others can bemanaged within limits.

The price competitiveness of a destination depends on the respective prices ofthe goods and services that cater to tourists needs (Dwyer et al., 2000a,b). Theperception of value is important, however. By itself, price is a meaningless indica-tor if not taken in context with the corresponding quality of a product. Visitorsmay be prepared to trade quality of experiences for lower prices (Buhalis, 2000:106). Providing value for money is one of the key challenges facing any tourismdestination. A wide range of pricing techniques are available to tourism firmsand organisations, but regardless of what actual prices may be, it is ultimatelyvisitor perceptions of those prices and of value that count.

Demand Conditions

While the bulk of the discussion of the competitiveness of firms and nations asappearing in the general literature focuses on supply-related items, demandfactors assume special importance in determining destination competitiveness.


The reason for this is that a destination may be competitive for one group of visi-tors but not for another group, depending on their motivations for travel. Thustravellers motivated by ‘sunlust’ (Gray, 1970) or ‘psychocentric’ (Plog, 1974)characteristics, for example, will prefer a destination featuring sunshine,beaches, resort hotels, or ski slopes, rather than one which has heritage resourceslocated in remote areas. And for a family wishing to experience theme parkentertainment, a resort island is no substitute for Orlando. Focus on the supplyside determinants gives an incomplete picture of destination competitiveness.

A widely used distinction between push and pull factors is relevant here(Crompton, 1979). ‘Pull’ factors can be regarded as destination attributes thatfulfil visitors’ travel motives. The discussion thus far has emphasised these ‘pullfactors’. By contrast, ‘push’ factors are forces arising from within the individualand from the individual’s social context. These are real motivational forces anddetermine a destination’s ‘competitiveness’ from the touristviewpoint (Josiam etal., 1999).

In the wider research literature on competitiveness, the nature of demand forthe industry’s product is regarded as having an important influence on firm, andhence destination, competitiveness. Demand conditions, particularly domesticdemand and its internationalisation to foreign markets, establish the ‘provinggrounds’ for the industry (Porter, 1990). A high domestic demand confers staticefficiencies and encourages improvement and innovation. Things seem to be nodifferent in the tourism context. In many cases it is domestic tourism that drivesthe nature and structure of a nation’s tourism industry. Foreign demand thrivesmore readily when domestic demand is well established.

With respect to destination price competitiveness, Dwyer et al. (1999) havedemonstrated that, given the different purchasing patterns of tourists accordingto motivation for travel, destination price competitiveness varies for differentgroups of visitors. This again reveals the importance of considering the ‘demandside’ in discussion of the underlying factors of destination competitiveness.

For demand to be effective, tourists must be aware of a destination and itsspecific offerings. There must also be a ‘fit’ between the types of experiencesgenerated by these products and consumer expectations (Woodside & Lysonski,1989). Thus, the competitiveness framework comprises three main elements oftourism: demand-awareness, perception and preferences. Awareness can begenerated by various means, including destination marketing activities. Theimage projected can influence perceptions and hence affect visitation. Actualvisitation will depend on the match between tourist preferences and perceiveddestination product offerings.

Indicators of Destination Competitiveness

Having developed a framework for destination competitiveness, the next stepis to develop indicators of competitiveness. For the purposes of the present study,a set of indicators of competitiveness was selected. These indicators were identi-fied from the major elements comprising the generic destination competitivenessmodel as just discussed. The selected set of indicators was also based on discus-sions at workshops held in Korea and Australia during April and May 2001. Therespondents were selected from databases of tourism industry stakeholders in


both Australia and Korea and comprised industry operators/peak groups,government officials and tourism research academics). In Australia, industryworkshops were held in both Brisbane and Sydney. An invitation was sent tomajor industry stakeholders requesting them to send a representative to theworkshop. In Korea focus group meetings, which were comprised of academia,travel business sectors (travel agencies, hotels, theme parks), and governmentofficials, were held in Seoul three times to identify important indicators whichcan be applied to destination competitiveness. In Australia, 14 industry stake-holders attended a Sydney workshop while nine attended its counterpart in Bris-bane.

Although these numbers are not large, the interactive discussion provided theresearchers with extremely useful input into model development and surveydevelopment. Participants at these workshops identified the important indica-tors of destination competitiveness falling under the main elements of the desti-nation competitiveness model. (The scope of the project did not enableconsumers to be directly surveyed; further use of the model would need to incor-porate consumer input and perceptions.) A symposium was held in Sydney on17 July 2001 to discuss findings and feedback from industry stakeholders. Thesymposium suggested research limitations, further research, and policy implica-tions from findings.

It must be emphasised that there is no single or unique set of competitivenessindicators that apply to all destinationsat all times. For any given factor underly-ing destination competitiveness, any number of indicators may be employed asmeasures. And for any given destination, different indicators of competitivenesswill be relevant. At best the investigator can highlight certain indicators fordiscussion. Some examples of relevant indicators are presented in Table 1. Theseindicators are only some of those that are relevant to determining destinationcompetitiveness. There are a myriad of indicators that can be employed at anygiven time.

As noted, individuals may differ in their perceptions of the same ‘objective’reality (Carroll & Chang, 1970; Ritchie, Crouch & Hudson, 2000;Wish, 1971). Theindicators of destination competitiveness, under the various elements compris-ing the competitiveness framework, can be categorised according to whetherthey are ‘objective’ or ‘subjective’. Thus, we can, for example, classify these keyindicators according to whether they are ‘hard’ or soft’ measures. ‘Hard’measures are those that are ‘objectively’ or ‘quantitatively’ measurable. Thesewould include the economic performance indicators in the final column ofTable 1. Examples of ‘hard’ measures of a destination’s competitiveness, inrespect of, say, natural resources, would be indicators such as the size of areasdevoted to national parks and nature reserves, topography, average meantemperatures, sunshine levels, number of coral reefs etc. In contrast, ‘soft’measures are those that relate to visitor perceptions and thus tend to be more‘subjective’ or ‘qualitative’ in form. ‘Soft’ measures of a destination’s competi-tiveness in natural resources would be those relating to ‘aesthetics’, ‘grandeur’,‘beauty’, and so on.

More research needs to be devoted to distinguishing the different types ofmeasures appropriate to the different indicators of competitiveness. The WorldEconomic Forum, in its development of country competitiveness indices, has



Table 1 Selected Indicators of Destination Competitiveness

Endowed Resources

Natural

´ Comfortable climate for tourism´ Cleanliness/Sanitation´ Natural wonders/Scenery´ Flora and fauna´ Unspoiled nature´ National parks/Nature reserves

Culture/Heritage

´ Historic/Heritage sites and museums´ Artistic/Architectural features´ Traditional arts´ Variety of cuisine´ Cultural precincts and (folk) villages

Created Resources

Tourism infrastructure

´ Accommodation quality/variety´ Airport efficiency/quality´ Tourist guidance/information´ Local transport efficiency/quality´ Visitor accessibility to natural areas´ Convention/Exhibition facilities (capacity/quality)´ Food services quality/variety

Range of activities

´ Water based´ Nature based´ Adventure activities´ Recreation facilities´ Sports facilities

Shopping

´ Variety of shopping items´ Quality of shopping facilities´ Quality of shopping items´ Value for money of shopping items´ Diversity of shopping experiences

Entertainment

´ Amusement/Theme parks´ Entertainment quality/variety´ Nightlife

Special events/festivals


Supporting Factors

General infrastructure

´ Adequacy of infrastructure to meet visitor needs´ Health/Medical facilities to serve tourists´ Financial institution and currency exchange facilities´ Telecommunication system for tourists´ Security/safety for visitors´ Local transport systems´ Waste disposal´ Electricity supply

Quality of service

´ Tourism/Hospitality firms which have well defined performancestandards in service delivery

´ Firms have programmes to ensure/monitor visitorsatisfaction

´ Visitor satisfaction with quality of service´ Industry appreciation of importance of service quality´ Development of training programmes to enhance quality

of service´ Speed/Delays through customs/immigration´ Attitudes of customs/immigration officials

Accessibility of destination

´ Distance/Flying time to destination from key origins´ Direct/Indirect flights to destination´ Ease/Cost of obtaining entry visa´ Ease of combining travel to destination with travel to other

destinations´ Frequency/Capacity of access transport to destination

Hospitality

´ Friendliness of residents towards tourists´ Existence of resident hospitality development

programmes´ Resident support for tourism industry´ Ease of communication between tourists and residents

Market ties

´ Business ties/trade links with major tourist originmarkets

´ Sporting links with major tourist origin markets´ Ethnic ties with major tourist origin markets´ Religious ties with major tourist origin markets´ Extent of foreign investment in local tourism

industry


Destination Management

Destination management organisation

´ NTO acts as coordinating body for private and public sector tourismorganisations

´ NTO effectively represents views of all tourism stakeholders in tourismdevelopment

´ NTO liaises effectively with private sector in tourism policy, planning anddevelopment

´ NTO provides statistical information as input to tourism policy, planning anddevelopment

´ NTO strategically monitors and evaluates the nature and type of tourismdevelopment

Destination marketing management

´ Reputation of NTO´ Effectiveness of destination positioning´ Strength/Clarity of destination image´ Efficient monitoring of destination marketing activities´ Effective packaging of destination experiences´ Links between destination tourism organisations and travel trade´ NTO identification of target markets´ NTO strategic alliances with other NTO´ Destination marketing is based on knowledge of competitor products´ Present ‘fit’ between destination products and visitor preferences

Destination policy, planning, development

´ Existence of formal long-term ‘vision’ for tourism industry development´ Destination ‘vision’ reflects resident values´ Destination ‘vision’ reflects tourism industry stakeholder values´ Tourism policy conforms to a formal destination ‘vision’´ Tourism planning and development conforms to a formal destination

‘vision’´ Tourism development is integrated into overall industrial development´ Ongoing tourism development is responsive to visitor needs´ Extent to which research findings are integrated into tourism planning and

development´ Inventory of most significant attractors, facilities, services and experiences

offered in destination´ Identification of major competitors and their product offerings´ Community support for special events

Human resource development

´ Public sector commitment to tourism/hospitality education andtraining

´ Private sector commitment to tourism/hospitality education andtraining

´ Training/education responsive to changing visitor needs´ Range/quality of tourism/hospitality training programmes


Environmental management

´ Public-sector recognition of importance of ‘sustainable’ tourism development´ Private sector recognition of importance of ‘sustainable’ tourism development´ Existence of laws and regulations protecting the environment and heritage´ Research and monitoring of environmental impacts of tourism

Situational Conditions

Competitive (micro) environment

´ Domestic business environment in destination´ Management capabilities of tourism firms and organisations´ Extent of competitive rivalry between firms in domestic tourism

industry´ Level of cooperation between firms in destination tourism industry´ Links between tourism/hospitality firms and firms in other industrial

sectors´ Entrepreneurial Qqualities of local tourism stakeholders´ Access to venture capital´ Tourism/hospitality firms operate in ethical manner´ Firms use computer technology/commerce to achieve competitive

advantage

Destination location

´ Perceived ‘exoticness’ of location´ Proximity to other destinations´ Distance from major origin markets´ Travel time from major origin markets

Global (macro) environment

´ The global business context´ Political stability´ Legal/Regulatory environment´ Government policies for tourism development´ Economic conditions in origin markets´ Sociocultural environment´ Investment environment for tourism development´ Technology changes


´ Value for money in destination tourism´ Exchange rate´ Air ticket prices from major origin markets´ Accommodation prices´ Destination package tour prices´ Price of destination visit relative to competitor destinations

Safety/Security

´ Level of visitor safety in destination´ Incidence of crimes against tourists in destination


Demand Factors

´ Destination awareness´ Destination perception´ Destination preferences

Market Performance Indicators

Visitor statistics (numbers)

´ Number of foreign visitors´ Growth rate of foreign visitors´ Market share of destination – world, regional´ Shifts in market share´ Average length of stay´ Rate of revisit

Visitor statistics (expenditure)

´ Expenditure of foreign visitors (FX receipts)´ Growth rate of expenditure of foreign visitors´ Share of destination in total tourism expenditure – world,

regional´ Shifts in expenditure share´ Foreign exchange earnings from tourism as percentage of total

exports

Contribution of tourism to economy

´ Contribution of tourism to value added (absolute values andpercentages, and rate of growth)

´ Domestic tourism´ International tourism´ Contribution of tourism to employment (absolute numbers;

percentage of total employment and rate of growth)´ Domestic tourism´ International tourism´ Productivity of tourism industry sectors

Indicators of economic prosperity

´ Aggregate levels of employment´ Rate of economic growth´ Per capita income

Tourism investment

´ Investment in tourism industry from domestic sources´ Foreign direct investment in tourism industry´ Investment in tourism as percentage of total industry investment

(and trend)

Price competitiveness indices

´ Aggregate price competitiveness indices´ By journey purpose´ By tourism sector

alwaysemphasised that no reliable measures exist for such competitiveness indi-cators as the efficiency of government institutions, the sophistication of localsupplier networks, or the nature of competitive practices (Porter et al., 2001). Aninitial attempt to distinguish ‘hard’ and ‘soft’ measures for tourism competitive-ness has been undertaken by Crouch et al. (2000) for various dimensions of theCrouch-Ritchie model of destination competitiveness.

No single table could list all of the dimensions of competitiveness or the asso-ciated indicators. We have listed some of the main dimensions and indicatorsonly. Moreover, the distinction between ‘hard’ and ‘soft’ measures is one ofdegree. Some measures have both a ‘hard’ and ‘soft’ feature. For example, the‘uniqueness’ of flora and fauna can be determined objectively with reference towhether they exist in the same forms in other locations (koalas, for example, arefound only in Australia). But some flora and fauna may not be perceived by thetourist to be unique and thus may play no role in generating visitor flows.

Issues for Further Research

There are several issues that must be addressed in the development of a frame-work of destination competitiveness.

One problem is that the end result of destination competitiveness –socioeconomic prosperity – is not well defined. There is much debate amongsocial theorists about the appropriate measures of social ‘welfare’ or ‘well being’.In recent years researchers have developed measures of social well-being whichinclude economic as well as ‘quality of life’ variables and variables relating toenvironmental quality. The development of indicators of destination competi-tiveness can benefit from the ongoing research in this area.

There is a need to explore the different types of indicators relevant to thedifferent contexts (levels) in which the model can be applied. The model devel-oped herein is intended to be able to serve as a framework for determining thecompetitiveness of an entire country as a tourism destination as well as its subre-gions, some of which may be quite small in size. It would be interesting toexplore, for example, the relevance, advantages and limitations of the model fordetermining the competitiveness of a city or geographically small destination.While the model developed herein is intended to have generic import, specificproblems may arise in particular applications.


Government support for tourism

´ Budget for tourism ministry´ Budget for NTO´ NTO expenditure on destination marketing (comparison with competitors)´ Support for transport infrastructure´ Industry programmes accessed by tourism industry´ Tax concessions´ Subsidies to industry´ Export marketing assistance´ Vocational education skills/training for tourism industry

Given that the principal factors contributing to competitiveness and thereforeto the improvement of living standards will differ for economies at differentlevels of development, a fact much emphasised in WEF explorations of countrycompetitiveness (World Economic Forum, 2001), additional research is warrant-ed on the applicability of the model to destinations at different stages of develop-ment. This area has, to our knowledge, been totally neglected by tourismresearchers to date.

A further issue is that of the relationship between the competitive advantageof the destination as a whole (as compared to alternative destinations) and thecompetitive advantage achieved by its constituent firms and organisations (ascompared to other firms and organisations both inside and outside of the desti-nation). While there is undoubtedly a link between the two, little is known aboutits strength and directions of influence. The topic has, unfortunately, beenneglected by researchers.

A major problem, underlying all attempts to establish indices of competitive-ness, involves the integration of objective and subjective attributes of competi-tiveness. An important issue for further research is to explore the possibility ofincorporating qualitative factors into the construction of a competitivenessindex. There is no method available that can be used to integrate ‘hard’ and ‘soft’factors into a single index. More research needs to be undertaken as to how‘objective’ and ‘subjective’ attributes of competitiveness are to be given dueweight in determining overall destination competitiveness.

More research needs to be undertaken on the relative importance of the differ-ent dimensions of competitiveness. Thus, for example, how important arenatural resources compared to, say, destination image? And within the categoryof natural resources, how important is, say, climate, compared to pristine envi-ronments? How important is service quality compared to price competitiveness?Such questions are unable to be answered in the absence of a specific destinationbeing studied and for specific visitor market segments to that destination.

There is also a need for further research on the importance of different attrib-utes of destination competitiveness in determining tourism flows for visitors indifferent market segments, and for travel decisions made in different buyingsituations or contexts. These issues flag an ongoing need for more detailedempirical studies of destination attributes, consumer preferences and the differ-ent components of the travel decision.

The implications of the framework for informing investment and otherresource allocation decisions by public- and private-sector tourism stakeholdersneed detailed exploration. Ideally, the model can inform tourism operatorsabout the cost effectiveness of different investments that can help their constitu-ent firms achieve and maintain competitive advantagewhile enhancing destina-tion competitiveness. The model should also provide a basis for informinggovernments about potential ‘net benefits’ from alternative policies to enhancedestination competitiveness. In this latter role, the model can be used to comparethe costs and benefits of different policy measures and agreements enacted bydifferent governments in terms of the extent to which they ultimately increase orreduce resident quality of life.

Ideally, the model can be used to compare the performance of differentdestinations world-wide in respect of competitiveness (Dwyer et al., 2003).


Performance ratings can be developed for destination competitiveness as awhole as well as for particular aspects of competitiveness. Thus measures can bedeveloped to compare the competitiveness of destinations in respect of all of themain determinants taken together, to compare the competitiveness of destina-tions in respect of the main dimensions of the model such as Created Resources,Supporting Factors and Resources and Destination Management, or as notedabove, to compare the effects on destination competitiveness of different govern-ment policy measures. The model can be used to develop strategies to increasebilateral tourism flows between any destination pair. In the context of bilateraltourism flows, it can be used to address the ‘pull’ that the attributes of each desti-nation have for residents of the other country and to highlight areas whereimpediments are placed in the way of visitor flows.

The model allows changes in destination competitiveness to be monitoredover time. Application of the indicators can provide a ‘moving picture’ of desti-nation competitiveness at different points in time. The model allows for destina-tion competitiveness to be assessed over time in respect of particular types oftravellers (by origin, demographic characteristics or motivation), or by compari-son to a particular competitor destination or competitor set of destinations. Inthis way trends in destination competitiveness can be linked to various private-and public-sector initiatives or other variables.

Conclusions

Since existing and potential tourism flows to any destination are inextricablylinked to that destination’s overall competitiveness there exists the need todevelop a framework and indicators of destination competitiveness. The devel-opment of a set of competitiveness indicators can serve as a valuable tool in iden-tifying what aspects or factors influence tourists in their decision to visit othercountries. Unfortunately, to date only a small number of tourism researchershave addressed this important topic.

The paper has sought to develop a model and indicators of destinationcompetitiveness that will enable comparison between countries and betweentourism sector industries. The development of a model of destination competi-tiveness and an associated set of indicators will allow identification of the rela-tive strengths and weaknesses of different tourism destinations, and can be usedby industry and governments to increase tourism numbers, expenditure andpositive socioeconomic impacts resulting from tourism growth.

The review of the management literature on ‘competitiveness’ revealed that,although the frameworks of competitiveness appearing in the wider literatureareuseful in highlighting the various determinants of ‘firm’ or ‘national’ compet-itiveness, they do not address the special considerations relevant to determining‘destination’ competitiveness.

The review of the literature on tourism destination competitiveness revealedthat none of the models that have been proposed to date are entirely satisfactory.In particular, they do not provide a comprehensive treatment of the variousissues surrounding the notion of ‘competitiveness’ that are being explored in thewider literature and that must be taken into account in developing a comprehen-sive framework of destination competitiveness.


A model of destination competitiveness was developed that sought to capturethe main elements of competitiveness highlighted in the general literature, whileaddressing the special issues involved in exploring the notion of destinationcompetitiveness as emphasised by tourism researchers. Associated with themodel is a set of indicators that can be used to measure the competitiveness ofany given destination. These indicators, comprising both objective and subjec-tive measures, were identified from the major elements comprising the genericdestination competitiveness model and also from discussions at workshops heldin Korea and Australia.

The advantages and limitations of the model were highlighted, and issues forfurther research were explored. The model developed here can form the basis forfurther conceptual and empirical research. Perhaps the major thrust of therequired research agenda is to explore the role of demand side factors in com-paring the competitiveness of different destinations. A substantial amount ofempirical research is needed to develop suitable measures of destinationcompetitiveness from the viewpoint of different types of tourists with theirdifferent travel motivations. The greater our knowledge about the interrelation-ships between consumer preferences and destination attributes, the moreinformed can be decision making by private- and public-sector stakeholders toenhance resident socioeconomic prosperity from the tourism industry.

Acknowledgements

Dwyer and Kim, were respectively, the academic project leaders of a study ofthe determinants of bilateral tourism flows between Australia and South Korea.The project was undertaken on behalf of the Department of Industry, Science andResources and the National Centre for Tourism in Australia, and the KoreanMinistry of Culture and Tourism, is association with the Korea TourismResearch Institute (KTRI). The resulting report was titled Destination Competitive-ness: Development of a Model with Application to Australia and the Republic of Korea.Input from team members Roger March, Peter Forsyth, Geoffrey Crouch, andKeetag Choi is gratefully acknowledged. The support of the Australian Depart-ment of Industry, Science and Resources, and the Korea Tourism Research Insti-tute is also acknowledged.

Correspondence

Any correspondence should be directed to Dr Larry Dwyer, Qantas Professorof Travel & Tourism Economics, Centre for Tourism Policy Studies, School ofEconomics, University of New South Wales, Sydney, NSW 2052, Australia([email protected]).

References

Aaker, D. (1989) Managing assets and skills: The key to a sustainable competitiveadvantage. California Management Review (Winter), 91–106.

Adams, P. and Parmenter, B. (1992)The Medium TermSignificanceof InternationalTourism tothe Australian Economy. Canberra: Bureau of Tourism Research.

Balogh, S. and Briuberg, D. (1997) Affective images of tourism destinations. Journal ofTravel Research 35 (4), 11–15.

Barney, J.B. (1991) Firms resources and sustained competitive advantage. Journal ofManagement 17, 99–120.


Bellak, C.J. and Weiss, A. (1993) A note on Austrian ‘diamond’. Management InternationalReview 33, 109–18.

Bittner, M. (1990) Evaluating service encounters: The effectiveness of physicalsurroundings and employee responses. Journal of Marketing 54, 69–82.

Buckley, R. (1994) A framework for ecotourism. Annals of Tourism Research 21 (3), 661–9.Bueno, A. (1999)Competitiveness in the tourist industry and the role of the Spanish public

administration. Turizam 47 (4), 316–31.Special issue on competitiveness in tourism andhospitality.

Buhalis, D. (2000) Marketing the competitive destination in the future. TourismManagement 21 (1), 97–116.

Buhalis, D. and Jafari, J. (1997) Tourism information technology and reengineering oftourism. Tourism Management 24 (1), 48–56.

Canestrelli, E. and Costa, P. (1991) Tourist carrying capacity: A fuzzy approach. Annals ofTourism Research 18 (2), 295–335.

Carroll, J. and Chang, J. (1970) Analysis of individual differences in multidimensionalscaling via an n-way generalization of Eckart-Young decomposition. Psychometrika 35(September), 283–319.

Cartwright, W.R. (1993) Multiple linked ‘diamonds’ and the internationalcompetitiveness of export-dependent industries: The New Zealand experience.Management International Review 33, 55–70.

Cho, D.S. (1998) From national competitiveness to bloc and global competitiveness.Competitiveness Review 8 (1).

Cohen, E. (1988)Authenticity and commodification in tourism. Annals of Tourism Research15 (2), 371–86.

Crompton, J. (1979) Motivations for pleasure vacations. Annals of Tourism Research 6 (4),408–24.

Crotts, J. (1996) Theoretical perspectives on tourist criminal victimisation. Journal ofTourism Studies 7 (1), 2–9.

Crouch, G. and Ritchie, J.B.R. (1995) Destination competitiveness and the role of thetourism enterprise. Proceedings of the Fourth Annual Business Congress (pp. 43–8).Istanbul, Turkey, 13–16 July.

Crouch, G.I and Ritchie, J.R.B. (1999) Tourism, competitiveness, and societal prosperity.Journal of Business Research 44, 137–52.

David, F. (2001)StrategicManagement:Concepts (8thedn). Upper Saddle River, NJ: PrenticeHall.

Day, G.S. and Wensley, R. (1988) Assessing advantage: A framework for diagnosingcompetitive superiority. Journal of Marketing 52 (April), 1–20.

D’Cruz, J.R. and Rugman, A.M. (1993) Developing international competitiveness: Thefive partners model. Business Quarterly, 60–72.

d’Harteserre, A. (2000) Lessons in managerial destination competitiveness in the case ofFoxwoods Casino resort. Tourism Management 21 (1), 23–32.

Duffey, J. (1988) Competitiveness and human resources. California Management Review(Spring), 92–100.

Dunn, R. and Iso-Ahala, S. (1991) Sightseeing tourists’ motivations and satisfaction.Annals of Tourism Research 18 (2), 226–37.

Dunning, J.H. (1992) The competitive advantage of nations and TNC activities: A reviewarticle. Transnational Corporations 1, 135–68.

Dunning, J.H. (1993) Internationalizing Porter’s diamond. Management InternationalReview 33 (special issue), 7–15.

Durand, M. and Giorno, C. (1987)Indicatorsof international competitiveness: Conceptualaspects and evaluation. OECD Economic Studies 9, 147–82.

Dutton, I. and Hall, M. (1989) Making Tourism Sustainable: The Policy/Practice Conundrum.Proceedings of the Environment Institute of Australia, Second National Conference,Melbourne, 9–11 October.

Dwyer, L., Burnley, I., Forsyth, P. and Murphy, P. (1995) Economic impacts of migrationinduced inbound tourism. Les Cahiers du Tourisme, série C 194 (November), 1–38.


Dwyer, L. and Forsyth, P. (1993) Foreign investment in Australian tourism: A frameworkfor assessing impacts. Journal of Tourism Studies 4 (1), 26–37.

Dwyer, L. and Forsyth, P. (1994) Motivation and impacts of foreign tourism investment.Annals of Tourism Research 21 (3), 512–37.

Dwyer, L. and Forsyth, P. (1998) Estimating the employment impacts of tourism to anation. Tourism Recreation Research 23 (2), 3–12.

Dwyer, L. and Forsyth, P. (2000) Government support of inbound tourism promotion:Some neglected issues. In C.A. Tisdell (ed.) The Economics of Tourism (vol. II) (pp.304–23). Cheltenham: Edward Edgar. Originally published in Australian EconomicPapers (1993).

Dwyer, L., Forsyth, P., Madden, J. and Spurr, R. (2000) Economic impact of inboundtourism under different assumptions about the macroeconomy. Current Issues inTourism 3 (4), 325–63.

Dwyer, L., Forsyth, P. and Rao, P. (1999) Tourism price competitiveness and journeypurpose. Turizam 47 (4), 283–99. Special issue on competitiveness in tourism andhospitality.

Dwyer, L., Forsyth, P. and Rao, P. (2000a)The price competitiveness of travel and tourism:A comparison of 19 destinations. Tourism Management 21 (1), 9–22.

Dwyer, L., Forsyth, P. and Rao, P. (2000b) Sectoral analysis of price competitiveness oftourism: An international comparison. Tourism Analysis 5 (1), 1–12.

Dwyer, L., Forsyth, P. and Rao, P. (2002)Destination price competitiveness: Exchange ratechanges vs inflation rates. Journal of Travel Research 40 (February), 340–48.

Dwyer, L., Forsyth, P. and Spurr, R. (2003, forthcoming ) Inter-industry effects of tourismgrowth: Some implications for destinations managers. Tourism Economics.

Dwyer, L., Forsyth, P., Spurr, R. and Ho, T. (2003) Economic evaluation of special events:A re-assessment. Unpublished.

Dwyer, L. and Kemp, S. (2003, forthcoming) Closure of an ecolodge: A failure of strategicmanagement? Journal of Pacific Studies.

Dwyer, L., Livaic, Z. and Mellor, R. (2003) Competitiveness of Australia as a tourismdestination. Journal of Hospitality and Tourism Management 10 (1).

Dwyer, L., Mellor, R., Mistilis, N. and Mules, T. (2000) Forecasting the economic impactsof events and conventions. Event Management 6 (1), 191–204.

Dwyer, L., Murray, P. and Mott, R. (1998)Continuous improvement in hospitality: A casestudy. Australian Journal of Hospitality Management 5 (1) (Autumn), 19–32.

Dwyer, L., Teal, G. and Kemp, S. (1998/9) Organisational culture and strategicmanagement in a resort hotel. Asia Pacific Journal of Tourism Research 3 (1), 27–36.

Esty, D. and Porter, M. (2001) Measuring national environmental regulation andperformance. In World Economic Forum The GlobalCompetitivenessReport 2001–2002.

Evans, N., Campbell, D. and Stonehouse, G. (2003) Strategic Management for Travel andTourism. Oxford: Butterworth-Heinemann.

Fagerberg, J. (1988) International competitiveness. Economic Journal 98, 355–74.Fakiolas, T. (1985) Basic causes of Soviet industry’s low international competitiveness.

Journal of Economic Studies 12 (5), 39–52.Faulkner, B. (1997) A model for the evaluation of national tourism destination marketing

programs. Journal of Travel Research 35 (3), 23–32.Ford, R. and Richardson, W. (1994) Ethical decision making: A review of the empirical

literature. Journal of Business Ethics 13 (3), 205–17.Franke, R.H., Hofstede, G. and Bond, M. (1991)Cultural roots of economic performance: A

research note. Strategic Management Journal 12, 165–73.Ghoshal, S. and Seok Ki K. (1986).Building effective intelligence systems for competitive

advantage. Sloan Management Review (Autumn), 49–58.Gilbert, D. (1990) Strategic marketing planning for tourism. Tourist Review 1, 18–27.Go, F. and Govers, R. (1999) The Asian perspective: Which international conference

destinations in Asia are the most competitive? Journal of Convention & ExhibitionManagement 1 (4), 37–50.

Go, F. and Govers, R. (2000) Integrated quality management for tourist destinations: A


European perspective on achieving competitiveness. Tourism Management 21 (1),79–88.

Gotlieb, J., Greval, D. and Brown, S. (1994) Consumer satisfaction and perceived quality:Complementary or divergent constructs? Journal of Applied Psychology 79 (6), 875–85.

Grant, R. (1991) The resource-based theory of competitive advantage: Implications forstrategy formulation. California Management Review (Spring), 114–35.

Gray, H.P. (1970) International Travel – International Trade. Lexington: Heath Lexington.Hassan, S. (2000) Determinants of market competitiveness in an environmentally

sustainable tourism industry. Journal of Travel Research 38 (3) (February), 239–45.Heath, E. (2000) Key trends and challenges in destination marketing: The need for a new

paradigm. In J. Ruddy and S. Flanagan (eds) Tourism DestinationMarketing:Gaining theCompetitive Edge (pp. 123–35). Tourism Research Centre, Dublin Institute ofTechnology.

Heath, E. (2003) Towards a model to enhance Africa’s sustainable tourismcompetitiveness. Proceedings of the Australian Tourism and Hospitality ResearchConference. Coffs Harbour, February.

Hilke, J. and Nelson, P. (1988) US International Competitiveness; Evolution or Revolution.New York: Praeger.

Hobson, P. (1996) Leisure shopping and tourism: The case of the Korean market toAustralia. Turizam 44, 228–44.

Hodgetts, R.M. (1993) Porter’s diamond framework in a Mexican context. ManagementInternational Review 33 (special issue), 41–54.

Hofstede, G. (1980) Culture’s Consequences: International Differences in Work-relatedValues.Beverly Hills, CA: Sage.

Hofstede, G. (1983)Dimensions of national cultures in fifty countries and three regions. InJ.B. Deregowski, S. Dziurawiec and R.C. Annis (eds) Explications in CrossculturalPsychology (pp. 335–355). Lisse, Netherlands: Swets and Zeitlinger.

Hofstede, G. and Bond, M.H. (1988) The Confucius connection: From cultural roots toeconomic growth. Organizational Dynamism 16: 4–21.

Inskeep, T. (1991) Tourism Planning: An Integrated and Sustainable Development Approach.New York: Van Nostrand Reinhold.

International Institute for Sustainable Development (IISD) (1994) Principles forsustainable tourism; Code of environmentally responsible tourism; and Codes ofethics for tourists. On WWW at http://www.iisd.org.

Johns, N. (1993) Quality management in the hospitality industry: Part three, recentdevelopments. International Journal of Contemporary Hospitality Management 5 (1).

Johnson, G. and Scholes, K. (1997)Exploring CorporateStrategy (4th edn). London: PrenticeHall.

Josiam, B., Smeaton, G. and Clements, C. (1999) Travel motivation and destinationselection. Journal of Vacation Marketing 5 (2), 167–75.

Kelly, J. (1978) Situational and social factors in leisure decisions.Pacific SociologicalReview21, 313–30.

Kemp, S. and Dwyer, L. (2001) An examination of organisational culture – the RegentHotel, Sydney. International Journal of Hospitality Management 20, 77–93.

Kennedy, P. (1987) The Rise and Fall of Great Powers. New York: Random House.Kogut, B. (1985) Designing global strategies: Comparative and competitive value-added

chains. Sloan Management Review (Summer), 15–28.Kotler P., Bowen, J. and Makens, J (1996) Marketing for Hospitality and Tourism. Upper

Saddle River: Prentice Hall.Kotler, P., Harde, D. and Rein, I. (1993) Marketing Places. New York: Free Press.Lee, C.K., Var, T. and Blain, T. (1996) Determinants of inbound tourism expenditures.

Annals of Tourism Research 23 (3), 527–42.Lewis, J. (1990) Partnerships for Profit: Structuring and Managing Strategic Alliances. New

York: Free Press.Lewis, R., Chamber, R. and Chacko, H. (1995) Marketing Leadership in Hospitality:

Foundations and Practices (2nd edn). New York: Van Nostrand Reinehold.


Machlis, G. and Burch, W. (1983) Relations among strangers: Cycles of structuring andmeaning in the tourist system. Sociological Review 31, 666–89.

Mahmoud, E., Rice, G. and Anders, G. (1992) Quality improvement programs: Tools forinternational competitive advantage. International Executive 34 (4), 305–20.

Mahoney, J.T. and Pandian, J.R. (1992)The resource based view within the conversation ofstrategic management. Strategic Management Journal 13, 363–80.

Mathur, S.S. (1992) Talking straight about competitive strategy. Journal of MarketingManagement 8, 199–217.

McDougall, P., Scott,S. and Ovett, B. (1994)Explaining the formation of international newventures: The limits of theories from international business research. Journal of BusinessVenturing 9, 469–87.

McGee, J.S. (1988) Industrial Organisation. Englewood Cliffs, NJ: Prentice Hall.McKercher, B. (1998) The effect of market access on destination choice. Journal of Travel

Research 37, 39–47.Mieczkowski, Z. (1995)Environmental Issues of Tourism and Recreation. London: University

Press of America.Mihalic, T. (2000)Environmental management of a tourist destination. A factorof tourism

competitiveness. Tourism Management 21 (1), 65–78.Mo, C., Handy, D. and Havitz, M. (1993) Testing an international tourist role typology.

Annals of Tourism Research 20 (2), 319–35.Moon, H.C. and Peery, N. (1995) Competitiveness of product, firm, industry, and nation

in a global business. Competitiveness Review 5 (1), 37–43.Murphy P., Pritchard, M. and Smith, B. (2000) The destination product and its impact on

traveller perceptions. Tourism Management 21 (1), 43–52.Narashimbha, S. (2000) Organisation knowledge, human resource management, and

sustained competitive advantage: Toward a framework. Competitiveness Review,123–35.

Newall, J.E. (1992) The challenge of competitiveness. Business Quarterly 56, 94–100.Newsome, D., Moore, S.A. and Dowling, R.K. (2002)NaturalArea Tourism: Ecology, Impacts

and Management. Mona Vale, NSW: Footprint.Okoroafa, S. (1995) Branding. In S. Witt and L. Moutinho Tourism Marketing and

Management Handbook (student edn) (pp. 351–8). Hertfordshire: Prentice Hall.Parsons, G.L. (1983) Information technology: A new competitive weapon. Sloan

Management Review 4 (Autumn), 342–51.Pechlaner, H. (1999)The competitiveness of Alpine destinations between market pressure

and problems of adaptation.Turizam 47 (4), 332–43. Special issue on competitiveness intourism and hospitality.

Peters, T. (1988) Restoring American competitiveness: Looking for new models oforganizations. Academy of Management Executive 2 (2), 103–9.

Plog, S. (1974) Why destination areas rise and fall in popularity. Cornell Hotel andRestaurant Administration Quarterly 15 (November), 13–16.

Poon, A. (1993) Tourism, Technology, and Competitive Strategy. Wallingford: CABInternational.

Porter, M.E. (1980)CompetitiveStrategy:Techniques for Analyzing Industries and Competitors.New York: Free Press.

Porter, M.E. (1985). Competitive Advantage: Creating and Sustaining Superior Performance.New York: Free Press.

Porter, M.E. (1990). The Competitive Advantage of Nations. New York: Free Press.Porter, M.E. (1999) Microeconomic competitiveness: Findings from the 1999 executive

survey. Global Competitiveness Report 1999. World Economic Forum (pp. 30–53).Porter, M.E. and Millar, V.E. (1985) How information gives you competitive advantage.

Harvard Business Review 63 (4), 149–60.Porter, M., Sachs, J. and McArthur, J. (2001) Executive summary: Competitiveness and

stages of economic development. In World Economic Forum The Global CompetitivenessReport 2001–2002.

Porter, M. and Van der Linde, C. (1995) Towards a new conception of the environment –competitiveness relationship. Journal of Economic Perspectives 9 (4), 97–118.


Powell, T.C. (1992a) Organizational alignment as competitive advantage. StrategicManagement Journal 13, 119–34.

Powell, T.C. (1992b)Strategic planning and competitive advantage. Strategic ManagementJournal 13, 551–8.

Prahalad, C.K. and Hamel, G. (1990) The core competence of the corporation. HarvardBusiness Review (May–June), 79–91.

Prentice, R. (1993) Heritage consumers in the leisure market: An application of theManning-Haas demand hierarchy. Leisure Sciences, 273–290.

President’s Commission on Industrial Competitiveness (1985)GlobalCompetition:The NewReality. Report of the President’s Commission on Industrial Competitiveness.Washington, DC: US Government Printing Office.

Prideaux B. (2000) The role of the transport system in destination development. TourismManagement 1, 53–64.

Ratz, T. and Puczko, L. (2000) The three forming one destination BPV. In J. Ruddy and S.Flanagan (eds) Tourism DestinationMarketing:Gaining theCompetitiveEdge (pp. 367–78).Tourism Research Centre, Dublin Institute of Technology.

Ritchie, J.R. and Crouch, G.I. (1993) Competitiveness in international tourism: Aframework for understanding and analysis. Proceedings of the 43rd Congress ofAssociation Internationale d’Experts Scientifique de Tourisme. San Carlos de Bariloche,Argentina, 17–23 October.

Ritchie, J.R. Brent and Crouch, G.I. (2000) The competitive destination: A sustainabilityperspective. Tourism Management 21 (1), 1–7.

Ritchie, J.B.R., Crouch, G. and Hudson, S. (2000) Developing operational measures for thecomponents of a destination competitiveness/sustainability model: Consumer versusmanagerial perspectives. Unpublished.

Ritchie, B.R. and Zins, M. (1978)Cultureas a determinant of the attractiveness of a tourismregion. Annals of Tourism Research 5, 252–67.

Rugman, A.M. (1991) Diamond in the rough. Business Quarterly 55 (3) (Winter), 61–4.Rugman, A.M. and D’Cruz, J.R. (1993) The ‘double diamond’ model of international

competitiveness: The Canadian experience. Management International Review 33(special issue), 17–39.

Rumelt R. (1984) Towards a strategic theory of the firm. In R.B. Lamb (ed.) CompetitiveStrategic Management (pp. 566–70). Prentice Hall.

Shaw, G. and Williams, A. (1990) Tourism, economic development and the role ofentrepreneurial activity. Progress in Tourism, Recreation and Hospitality Management,67–81.

Sinclair, T. and Stabler, M. (1997) The Economics of Tourism. London: Routledge.Singapore Tourism Board (2000) Survey of Overseas Visitors to Singapore 1999. STB.Smith, S. (1994) The tourist product. Annals of Tourism Research 21 (3), 582–95.Spence, A.M. and Hazard, H.A. (eds) (1988) International Competitiveness. Cambridge,

MA: Ballinger.Teye, V. (1988) Coup d’État and African tourism: A study of Ghana. Annals of Tourism

Research 15 (3), 329–56.TIA (1999) Building Strategic Business Alliances. Proceedings of the TIA Educational

Seminars on Building Strategic Business Alliances. Washington, DC: TourismIndustry Association of America.

Tribe, J. (1999) The Economics of Leisure and Tourism. Oxford: Butterworth-Heinemann.Uysal, M., Chen, J. and Williams, D. (2000) Increasing state market share through a

regional positioning. Tourism Management 21 (1), 89–96.Wade-Benzoni, K. (1999) Thinking about the future: An intergenerational perspective on

the conflict and compatibility between economic and environmental interests.American Behavioral Scientist 42 (8), 1393–404.

Waheeduzzan, A. and Ryans, J. (1996) Definition, perspectives, and understanding ofinternational competitiveness: A quest for a common ground. CompetitivenessReview 6(2), 7–26.

Watson, G. and Kopachevsky, J. (1994) Interpretation of tourism as a commodity. Annalsof Tourism Research 21 (3), 643–60.


Wish (1971)Individual differences in perceptions and preferences among nations. InC.W.King and D. Tigert (eds) Attitude Research Reaches New Heights (pp. 312–28). Chicago:American Marketing Association.

Woodside, A. and Lysonski, S. (1989) A general model of traveler destination choice.Journal of Travel Research 27 (4), 8–14.

World Economic Forum (2001) The Global Competitiveness Report 2001–2002.World Tourism Organisation (1979) The Role and Structure of National Tourism

Administrations. Madrid: World Tourism Organisation.WTTC (2001) Competitiveness Monitor. London: World Travel and Tourism Council.Yip, G.S. (1989) Global strategy: In a world of nations. Sloan Management Review

(Autumn), 29–40.


destination competitiveness

Documents

upper saddle

van der linde

world economic

bilateral

key success

california

sloan management

numerous alternative