Developing an empowerment framework for broad-based black economic empowerment in the hotel industry in South Africa
Date
2013-12
Authors
Journal Title
Journal ISSN
Volume Title
Publisher
Stellenbosch : Stellenbosch University
Abstract
This study investigated the implementation of broad-based black economic empowerment
(BBBEE) policy in the hotel industry of South Africa. BBBEE aims to accelerate the inclusion of
black people into the economy through company ownership, human resource, and enterprise and
community development. Although black people represent 91 per cent of South Africa’s population,
the economy is controlled by a small white population. Studies have shown slow adoption and
resistance to the BBBEE policy by the private sector, including in the hotel industry. Therefore, the
research problem was the nature of compliance with, and the implementation of, black
empowerment policy in the hotel industry.
The main objective of the study was to investigate whether a framework for the effective
implementation of black empowerment policy could be developed, given the centrality of hotels in
the tourism value chain. The specific objectives were to determine the nature of the disconnect on
BBBEE, to identify factors which facilitated or inhibited implementation, and to explore solutions for
enhancing BBBEE implementation in the hotels.
A quantitative investigation of 611 hotel general managers constituted the core of the dissertation’s
content and contribution. Data from 178 respondents was analysed using descriptive and
correlational statistical methods. The development of the quantitative research instrument was
substantiated by the preliminary qualitative study of five hotel group executives. The mixed
methods approach was appropriate for investigating the dual structure (group and unit) of the hotel
industry.
The results indicated that hotels were recording progress on human resource development
although compliance levels did not meet the required BBBEE targets. On enterprise development,
the hotels’ engagement with small black enterprises was low both quantitatively and qualitatively.
Furthermore, hotel group leaders indicated that the tourism-specific BBBEE charter presented
bureaucratic challenges, as tourism straddles several industries which required different BBBEE
certification.
The study has developed an empowerment framework of solutions for achieving success in
BBBEE in hotels. The primary factors determining success are the provision of performance
targets and incentives for general managers, and if the hotel manager supports BBBEE policy.
Furthermore, exogenous factors such as the star rating and location of a hotel also impact on
BBBEE implementation. A quantitative investigation of 611 hotel general managers constituted the core of the dissertation’s
content and contribution. Data from 178 respondents was analysed using descriptive and
correlational statistical methods. The development of the quantitative research instrument was
substantiated by the preliminary qualitative study of five hotel group executives. The mixed
methods approach was appropriate for investigating the dual structure (group and unit) of the hotel
industry.
The results indicated that hotels were recording progress on human resource development
although compliance levels did not meet the required BBBEE targets. On enterprise development,
the hotels’ engagement with small black enterprises was low both quantitatively and qualitatively.
Furthermore, hotel group leaders indicated that the tourism-specific BBBEE charter presented
bureaucratic challenges, as tourism straddles several industries which required different BBBEE
certification.
The study has developed an empowerment framework of solutions for achieving success in
BBBEE in hotels. The primary factors determining success are the provision of performance
targets and incentives for general managers, and if the hotel manager supports BBBEE policy.
Furthermore, exogenous factors such as the star rating and location of a hotel also impact on
BBBEE implementation.
This study builds on, and adds value to previous studies by moving beyond the investigative mode
to identifying practical policy options for successful transformation of the hotel industry. The
proposed framework acknowledges the diverse nature of the tourism product, and provides potential solutions to enhance the hotel managers’ ability to anticipate and incorporate factors
impacting on BBBEE implementation. The framework adds theoretical value to affirmative action
discourse by suggesting a conceptual shift from a race-based approach to an alternative one which
would incorporate sustainable tourism and ethical governance concerns. Such an approach would
maximise BBBEE potential in the hotel industry of South Africa for beneficiaries and communities.
Additional research is recommended to substantiate the hypothesis with a broader sample as the
study was limited to hotel managers.
Description
Thesis (PhD)--Stellenbosch University, 2013.
Keywords
Black Economic Empowerment (Program : South Africa), Affirmative action programs, Business enterprises, Black -- South Africa, Blacks -- Employment -- South Africa, Tourism -- South Africa, Hospitality industry -- South Africa -- Employment, Dissertations -- Business management, Theses -- Business management