Measuring latent variable on total quality management (TQM) and sustainable performance in Malaysia hotel industries using multi criteria decision making (MCDM) approach: a sequential exploratory mixed method design

The hotel industry is labour intensive and characterised by features such as high staff turnover, unique end service/product, as well as transient labour force. The industry is also dominated by a few large hotel organisations and many small organisations. Evidence from various sources suggested that large firms are more likely to implement Total Quality Management (TQM) programs than small firms. Benefits of TQM include increased employees commitment, enhanced job satisfaction and motivation among employees, improved organisational performance and the list goes on. Nonetheless, there is no empirical evidence that academicians evaluate the outcomes of TQM phenomena within Malaysia hotel industries especially for four and five star hotels. This research set out to explore these issues by evaluating TQM phenomena implemented by four and five star hotel organisations within Peninsular Malaysia. Therefore, this thesis adopted a sequential exploratory mixed methods approach which was reflected in the evaluation methodology. The first phase collected qualitative data from hotel organisations through semi-tructured interviews. The aim of Phase 1 was to identify what TQM practices were implemented, and to identify the possible new latent dimension inherent within the hotel entities. The results of phase one showed that business ethics emerged as a new dimension that need to be emphasised within hotel industries in order to sustain in longer period. The conclusion of Phase 1 also identified the relationship between TQM and sustainable performance, TQM and business ethics, business ethics and sustainable performance, as well as mediating effect of business ethics between TQM and sustainable performance. The second phase of the research measured the presence of the intended outcome identified from Phase 1 and focused on the relationship between the constructs. The relationship between TQM and sustainable performance, TQM and business ethics, business ethics and sustainable performance, as well as mediating effect of business ethics between TQM and sustainable performance were found to be statistically positive and significant. As a result, the research recommends that hotel organisations that adopt effective TQM and conduct business ethics as core element, will lead to increased sustainable performance.