Examining the effects of environmental strategy and competitive advantage on business performance

Abstract

Rapid economic changes and globalization have triggered urgent response from firms to devise effective strategies in improving performance and ensuring long-term survival. This study examined the influence of environmental strategy and competitive advantage on business performance. Subsequently, it determined the different effects of environmental strategy and competitive advantage on business performance. This cross-sectional study involved a total of 222 hotel managers as respondents. Data in the study was obtained via self-administered questionnaires. Partial Least Squares (PLS) analysis was used to test the hypotheses of study. Findings of this study revealed the significant and positive effects of environmental strategy and competitive advantage on business performance. Competitive advantage has been found to contribute towards a higher variance on business performance than environmental strategy. Results obtained have proven the robustness of the theory applied in this study to explain the business performance of the tourism industry in the context of a developing country. The results close the gaps in previous research findings that will add to the current body of knowledge.