Optimizing the Competitive Advantage of Four and Five Star Hotels in Bali with Strategic Thinking and Local Wisdom

Published: Jan 10, 2025

Abstract:

Purpose: This study examines the influence of the local wisdom of Panca Budhi Indriya on competitive advantage in 4&5-star hotels in Bali. It also investigated the mediating role of strategic thinking in enhancing the relationship between local wisdom and competitive advantage.

Methodology: This study adopted a quantitative approach and used survey data collected from 158 general managers of 4&5-star hotels in Bali. Data were analyzed using Structural Equation Modeling-Partial Least Squares (SEM-PLS) with SmartPLS 3 software. The study employs a structured questionnaire based on indicators developed for local wisdom, strategic thinking, and competitive advantage.

Results: The findings revealed that Panca Budhi Indriya has a significant and positive influence on competitive advantage. Additionally, strategic thinking significantly mediated the relationship between Panca Budhi Indriya and competitive advantage, acting as a complementary mediator. This demonstrates that integrating local wisdom with strategic management practices enhances hotels’ competitive edge.

Limitations: This study was limited to 4&5-star hotels in Bali, which may not fully represent the broader hospitality sector. This quantitative approach also limits the exploration of deeper qualitative insights into the role of local wisdom in strategic management.

Contribution: This study contributes to the field of tourism and hospitality management by providing empirical evidence of how local wisdom can serve as a strategic resource for achieving competitive advantage. These findings offer practical insights for hotel managers, policymakers, and academics interested in integrating cultural values into strategic planning to support sustainable tourism development.

Keywords:
1. Local Wisdom of Panca Budhi Indriya
2. strategic thinking
3. competitive advantage
Authors:
1 . Ni Nyoman Sudiyani
2 . I Gusti Putu Agung Widya Goca
3 . Cokorda Istri Agung Vera Nindia Putri
4 . Anak Agung Istri Agung Ovy Dwijayanthi
5 . I Kadek Eko Darma Putra
How to Cite
Sudiyani, N. N. ., Goca, I. G. P. A. W. ., Putri , C. I. A. V. N. ., Dwijayanthi, A. A. I. A. O. ., & Putra, I. K. E. D. . (2025). Optimizing the Competitive Advantage of Four and Five Star Hotels in Bali with Strategic Thinking and Local Wisdom. Studi Akuntansi, Keuangan, Dan Manajemen, 4(2), 473–486. https://doi.org/10.35912/sakman.v4i2.3966

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References

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  1. Aji, H.K., Murdani, A.D. and Wijayati, H. (2023), “The Strategy in Developing Global Competitive Tourism Based on Creative Economy and Local Wisdom (Case Study: Solo City, Indonesia)”, International Journal of Business and Applied Economics, PT Formosa Cendekia Global, Vol. 2 No. 5, pp. 851–862, doi: 10.55927/ijbae.v2i5.5970.
  2. Akter, S., Ambra, J.D.’ and Ray, P. (2011), “An evaluation of PLS based complex models: the roles of power analysis, predictive relevance and GoF index”, Proceedings of the 17th Americas Conference on Information Systems (AMCIS2011), Association for Information Systems., Detroit, USA, pp. 1–7.
  3. Amason, A.C. and Ward, A. (2020), “Strategies for Competitive Advantage”, Strategic Management, Routledge, Second Edition. | New York?: Routledge, 2020. | Revised edition of Strategic management, 2011., pp. 148–174, doi: 10.4324/9781003000594-6.
  4. Andari, R., I, W.G.S., I, G.R. and Sukawati, T.G.R. (2022), “The Strength of Local Wisdom Values as a Differentiation Strategy in Creating Sustainable Tourism Competitiveness”, Webology, Vol. 19 No. 1, pp. 4088–4104, doi: 10.14704/WEB/V19I1/WEB19269.
  5. Badan Pusat Statistik. (2024), “Perkembangan Pariwisata Provinsi Bali Maret 2024 - Badan Pusat Statistik Provinsi Bali”, 2 May, available at: https://bali.bps.go.id/id/pressrelease/2024/05/02/717893/perkembangan-pariwisata--provinsi-bali-maret-2024.html?utm_source=chatgpt.com (accessed 11 November 2024).
  6. Bali Post. (2024), “Diyakini Pertumbuhan Pariwisata Masih Kuat, Ini Proyeksi Ekonomi Bali di 2024 | BALIPOST.com”, 7 October, available at: https://www.balipost.com/news/2024/10/07/420923/Diyakini-Pertumbuhan-Pariwisata-Masih-Kuat,...html?utm_source=chatgpt.com (accessed 11 November 2024).
  7. Barney, J. (1991), “Firm Resources and Sustained Competitive Advantage”, Journal of Management, Vol. 17 No. 1, pp. 99–120, doi: 10.1177/014920639101700108.
  8. Bilancini, E., Boncinelli, L. and Mattiassi, A. (2019), “Assessing actual strategic behavior to construct a measure of strategic ability”, Frontiers in Psychology, Frontiers Media S.A., Vol. 9 No. JAN, doi: 10.3389/fpsyg.2018.02750.
  9. BPS. (2023), “Banyaknya Hotel Bintang Menurut Kelas dan Kabupaten/Kota di Provinsi Bali - Tabel Statistik - Badan Pusat Statistik Provinsi Bali”, available at: https://bali.bps.go.id/id/statistics-table/2/MjIyIzI=/banyaknya-hotel-bintang-menurut-kelas-dan-kabupaten-kota-di-provinsi-bali.html (accessed 11 November 2024).
  10. Bushairi, S.A. Al, Sularso, R.A., Tobing, D.S.K. and Irawan, B. (2024), “The role of collaborative competitiveness marketing tourism towards sustainable competitive advantage in creative industries in the VUCA era”, Uncertain Supply Chain Management, Vol. 12 No. 3, pp. 1721–1738, doi: 10.5267/j.uscm.2024.3.009.
  11. Cetinkaya, A., Niavand, A. and Rashid, M. (2019), “Organizational Change and Competitive Advantage: Business Size Matters”, Vol. 7, pp. 40–67.
  12. David, F.R. and David, F.R. (2024), Strategic Management: A Competitive Advantage Approach, Concepts and Cases, Global Edition, 17th Edition, 17th ed., Pearson, Debrecen.
  13. Dixit, S., Singh, S., Dhir, S. and Dhir, S. (2021), “Antecedents of strategic thinking and its impact on competitive advantage”, Journal of Indian Business Research, Vol. 13 No. 4, pp. 437–458, doi: 10.1108/JIBR-08-2020-0262.
  14. Dolega, L. and Lord, A. (2020), “Exploring the geography of retail success and decline: A case study of the Liverpool City Region”, Cities, Vol. 96, p. 102456, doi: 10.1016/j.cities.2019.102456.
  15. Elhoda Ali, N., Abdallah Mohamed, G. and Atef Alakhras, H. (2021), “Enhancing the competitive advantage for tourist souvenirs in Egypt: a marketing approach”, Journal of Sustainable Tourism and Entrepreneurship, Vol. 2 No. 1, pp. 15–29, doi: 10.35912/joste.v2i1.516.
  16. Faridha, N. (2022), “Local wisdom: Sustainable Tourism Development”, International Social Sciences and Humanities, Universitas Muhammadiyah Jember, Vol. 1 No. 2, pp. 272–277, doi: 10.32528/issh.v1i2.185.
  17. Geier, M.T. (2024), “Strategic thinking: theoretical development and assessment”, Journal of Strategy and Management, Vol. 17 No. 1, pp. 1–21, doi: 10.1108/JSMA-10-2021-0212.
  18. Gerald, E., Obianuju, A. and Chukwunonso, N. (2020), “Strategic agility and performance of small and medium enterprises in the phase of Covid-19 pandemic”, International Journal of Financial, Accounting, and Management, Vol. 2 No. 1, doi: 10.35912/ijfam.v2i1.163.
  19. Ghozali, I. (2021), Partial Least Squares Konsep, Teknik Dan Aplikasi Menggunakan Program SmartPLS 3.2.9 Untuk Penelitian Empiris, 3rd ed., Universitas Diponegoro Semarang, Semarang.
  20. Grant, R.M. (1991), “The Resource-Based Theory of Competitive Advantage: Implications for Strategy Formulation”, California Management Review, Vol. 33 No. 3, pp. 114–135, doi: 10.2307/41166664.
  21. Hadiwijaya, H. and Yustini, T. (2024), “Analysis of consumer preferences towards digital marketing and its implications on the competitive advantage of SMEs in Banyuasin Regency”, Annals of Human Resource Management Research, Vol. 3 No. 2, pp. 83–96, doi: 10.35912/ahrmr.v3i2.1838.
  22. Hair, J.F.Jr., Hult, G.T.M., Ringle, C.M. and Sarstedt, M. (2017), “A Primer on Partial Least Squares Structural Equation Modeling (PLS-SEM). Thousand Oaks”, Sage, p. 165.
  23. Hair Jr, J.F., G. Tomas M. Hult, Christian M. Ringle, Marko Sarstedt, Nicholas P. Danks and Soumya Ray. (2021), Partial Least Squares Structural Equation Modeling(PLS-SEM) Using R, SPRINGER, Switzerland, doi: https://doi.org/10.1007/978-3-030-80519-7.
  24. Kalinichenko, S. (2023), “Development Of The Positioning Concept Of Tourism Organizations”, Black Sea Economic Studies, No. 83, doi: 10.32782/bses.83-22.
  25. Kumara, S., Warnakulasuriya, B. and Hewapattu Arachchige, B. (2019), “HR Practices: A Source of Sustainable Competitive Advantage or Competitive Parity – A Systematic Literature Review”, Vidyodaya Journal of Management, Vol. 5, doi: 10.31357/vjm.v5i2.4183.
  26. Liedtka, J.M. (1998), “Strategic thinking: Can it be taught?”, Long Range Planning, Vol. 31 No. 1, pp. 120–129, doi: 10.1016/S0024-6301(97)00098-8.
  27. Lisdiyono, E. (2017), Exploring The Strength Of Local Wisdom In Efforts To Ensure The Environmental Sustainability, International Journal Of Civil Engineering And Technology, Vol. 8.
  28. Mawardi, I. (2018), “Wisdom Local Empowerment In Sustainable Development Perspective”, Jurnal Rekayasa Lingkungan, Vol. 8 No. 1, doi: 10.29122/jrl.v8i1.1975.
  29. Methelda Oematan, H., Elerina Douk Tunti, M. and Tefa, S.G. (2022), “Tourism Development Strategy Based On Local Wisdom In Improving The Welfare Of Local Communities”, Eduvest-Journal of Universal Studies, Vol. 2 No. 1, pp. 1–13.
  30. Porter, M. (1985), “Competitive Advantage: Creating and Sustaining Superior Performance”, p. .
  31. Presutti, M., Savioli, M. and Odorici, V. (2020), “Strategic orientation of hotels: Evidence from a contingent approach”, Tourism Economics, Vol. 26 No. 7, pp. 1212–1230, doi: 10.1177/1354816619868886.
  32. Rahayu, D. and Yanis, F. (2023), “Tourism Communication Model Based on Local Wisdom on Lombok Island, West Nusa Tenggara”, Eduvest - Journal of Universal Studies, Vol. 3 No. 9, pp. 1608–1616, doi: 10.59188/eduvest.v3i9.883.
  33. Ramanauskas, J. and Banevicius, S. (2021), “Principles Of Organizational Wisdom In The Health Tourism Industry”, Baltic Journal of Economic Studies, Publishing House Baltija Publishing, Vol. 7 No. 4, pp. 1–7, doi: 10.30525/2256-0742/2021-7-4-1-7.
  34. Riestyaningrum Kusumawati, F. (2020), “Profitability determinants of five-star hotels in Yogyakarta”, Annals of Management and Organization Research, Vol. 2 No. 1, pp. 41–52, doi: 10.35912/amor.v2i1.670.
  35. Rodrigues, R.I., Ferreira, A. and Neves, J. (2023), “Strategic thinking: The construction and validation of an instrument”, Polish Psychological Bulletin, Vol. 52 No. 3, pp. 241–250, doi: 10.24425/ppb.2021.137888.
  36. Rozanna, M. (2023), “What is strategic management research?”, Annals of Management and Organization Research, Vol. 4 No. 4, pp. 271–280, doi: 10.35912/amor.v4i4.1622.
  37. Sereda, N., Albeshchenko, O., Krupitsa, I., Biletska, N. and Krasnik, A. (2024), “Strategic approaches to tourism development: Crafting competitive strategies for business growth in the tourism sector”, Multidisciplinary Reviews, Vol. 7, p. 2024spe004, doi: 10.31893/multirev.2024spe004.
  38. Sigalas, C. and Pekka Economou, V. (2013), “Revisiting the concept of competitive advantage”, Journal of Strategy and Management, Vol. 6 No. 1, pp. 61–80, doi: 10.1108/17554251311296567.
  39. Škrinjari?, B. (2022), “Competence-based approaches in organizational and individual context”, Humanities and Social Sciences Communications, Vol. 9 No. 1, p. 28, doi: 10.1057/s41599-022-01047-1.
  40. Soni, P. (2015), The Theory of the Growth of the Firm (Edith Penrose, 1959).
  41. Størner, A. and Teller, A. (2019), “Strategic Thinking is Context Dependent”, Lund University, p. .
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  43. Syafi’i, M., Syaflita, D. and Putra, M.J.A. (2024), “Opportunities and Challenges in Transforming into an Industry-Oriented Local Wisdom Tourism Village”, KnE Social Sciences, doi: 10.18502/kss.v9i19.16521.
  44. Teller, C. and Schnedlitz, P. (2012), “Drivers of agglomeration effects in retailing: The shopping mall tenant’s perspective”, Journal of Marketing Management, Vol. 28 No. 9–10, pp. 1043–1061, doi: 10.1080/0267257X.2011.617708.
  45. Violinda, Q., Noni Setyorini, Ulumuddin, A. and Herlambang, B.A. (2023), “Local Wisdom, Resilience, and Technology Acceptance Model (TAM) based Augmented Reality (AR) on tourism performance in Ngerangan Village, Klaten”, Journal of Innovative Agriculture and Social Development, Researchers Digital Publishers, Vol. 2 No. 1, pp. 34–43, doi: 10.57095/jiasd20232130.
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