Measuring performance among New Zealand tourism businesses: an EVA evaluation in the Akaroa township

Abstract

Yield has become a central issue in tourism development. The New Zealand Tourism Strategy 2010 has called for a sustainable yield in two of its four key principles for the sector's long-term prosperity.

Despite the rhetoric about tourism yield, little is known of its meaning or measurement, especially among tourism proprietors. A broad measure is required to address the questions of financial, economic and community-based sustainability at each level of the sector. That is, one that not only captures an accurate financial and economic measure of a high yield but also measures the sustainability of community and public assets.

This is a pilot study of tourism proprietors' perceptions of business performance tools and yield management strategies among tourism businesses in Akaroa Township, a small coastal resort town on the east coast of the South Island of New Zealand. A mixed method approach (qualitative and quantitative) is employed in the study. Economic Value Added (EVA) is used as a quasi-experimental tool to measure the tourism business proprietors' perceptions and behaviour of measuring performance in New Zealand and their learning readiness for a new performance metric.

The findings of the study indicate that many tourism proprietors have a poor understanding even of financial yield and of how to measure their business success. Many tourism proprietors are involved in the sector for a 'mixed bag' of motivations, which suggests that a measure of a purely financial yield will miss much of the true nature of their tourism investing and operating decisions. Trust is important to getting-in and getting alongside the people involved and an interactive approach to future studies is recommended.