Clustering and networking among small independent hotels: developments over ten years

Abstract

This paper reports on networking activities amongst a cluster of independent hotels with a view to analysing key variables in network development for SMEs. A comparative, longitudinal element is introduced by reference to an earlier study of the same phenomenon, ten years earlier. Of particular interest is the influence of various forms of social capital in the development of informal networks and the inter-play between co-operation and competition over time. Given the time gap between the two studies, the effect of sectoral changes on network development is also examined. The research revisits and extends a previous study of many of the same hotels which were investigated in 1995 over their formal and informal links that were found to be influenced by such factors across two classifications - the business as unit (proximity, perceptions of quality) and the individual respondent (personal social networks and ethnicity). Extending that analysis, social capital concepts and relevant references to embedded networks and kinship groups and co-operative game rules will be introduced in this paper.

A highly concentrated population of small, independent hotels in Central London had been identified in the previous research project and it is from this sample that the current research drew and extended its own sample of hotels. With such a high number of hotels in the area a mixture of ‘snowball’ sampling and self-selection was successfully employed. Of the original 29 hotels, 22 have been re-interviewed and complemented by another 19. Of the remainder of the original sample, several had subsequently merged or failed to survive the intervening period. Face-to-face interviews were conducted with owner-managers in all cases using a structured questionnaire that replicated as much as possible of the original questionnaire, with both open and closed questions to allow some individual expression on relevant topics. The quantitative data obtained will be analysed using UCINET software to generate visual representations of networks alongside statistical and cluster analyses.

Both academic and policy implications are likely to arise from this research, such as novel insights from such an unique periodic comparison of networks development, the influence of social capital on (formal and informal) network activities and the changing influence and consolidation of hotel groups through mergers and franchising.