INTRODUCTION
The phenomenon of competition between tourist destinations is considered to be an element of the new model of economic competition in the 21st century. Although it has special features, this kind of competition reflects the natural competition that arises in the context of all other forms of human activity. The competitiveness of tourist destinations explicitly indicates their level of socio-economic development, with special emphasis on quality of life. Therefore, consideration of competitive advantage of a tourist destination should imply an understanding of the factors and circumstances of such competition (Popesku, 2011).
Competitiveness is based on a range of macroeconomic factors, which include: costs; wages; interest rates and foreign exchange rates; other competitive advantages, and the significant potential of natural resources that can attract tourists. Competitiveness is defined as the ability of a destination or organisation to achieve a high perceived value within the context of the market. According toČerović (2009), tourist destinations must constantly develop activities that are different from those offered by their competitors.
The competitiveness of tourist destinations and its benefits in the tourism market are based on the theory of comparative advantage. According toPopesku (2011), comparative advantage is based on richness of factors of production. These are usually grouped into five main categories: human resources; natural resources; knowledge; capital, and infrastructure. In the case of tourist destinations, it is necessary to add historical and cultural resources as a separate category, and to expand the category of infrastructure to include superstructure. The comparative advantages of a tourist destination can be divided into two types: exogenous and endogenous. Exogenous comparative advantages include the original resources of the destination, such as natural, cultural and historical resources, capital and investment, and development of infrastructure and tourism superstructure. Endogenous comparative advantages include human and knowledge-based resources, as well as technological innovation (Popesku, 2011).
It should be noted that the comparative advantages of tourist destinations are an important, but not a sufficient, condition to define their international competitiveness. Destinations must make efforts to create and maintain competitive advantage (Čerović, 2009).
Montenegro bases its policy development around encouraging tourism, as evidenced by numerous parameters. However, the number of tourist arrivals and overnight stays, combined with the share of Montenegro’s GDP contributed by tourism, investment in tourist activity and employment in the tourism sector, are not sufficient indicators of its competitiveness. As a special parameter for assessment and determination of the competitive advantages of a tourist destination, experts’ opinions can be used.
According to theWorld Economic Forum (WEF) (2015), Montenegro holds the 67th position out of 141 countries ranked within the travel and tourism competitiveness index (TTCI). It holds 47th place in terms of infrastructure, while it is ranked 56th in terms of stimulating environment, 91st in terms of incentive policies and conditions for travel and tourism, and 105th in terms of natural and cultural resources. Montenegro is placed highest in infrastructure of tourist services, holding the 19th position, while it is most poorly ranked (134th) for cultural resources and business trips. Regarding human resources and labour market, Montenegro occupies 35th position, while it is ranked 47th for safety and security. It is in 55th position in terms of health and hygiene conditions and in 58th for readiness to use ICT. When it comes to the prices of tourist services, Montenegro occupies the 84th ranking, and it is placed 56th for flight infrastructure and 66th for land and port (WEF, 2015).
A new report from 2017 states that Montenegro is ranked in 72nd position out of the total of 136 assessed countries, which means that its ranking has dropped by five positions. The TTCI value for Montenegro is 3.68 (WEF, 2017).
LITERATURE REVIEW
Tourist Destination Competitiveness (TDC) Models
In this section the most commonly used models of tourist destination competitiveness (TDC) are presented. In addition, special focus is placed on the factors used to determine TDC. The theoretical setting provided in this section served as a base for developing the interview questionnaire.
Dwyer and Kim (2003) developed a model of TDC that provides an overview of the relevant elements and indicators. The first part of the model concerns the resources of the destination, which correspond to its primary and secondary elements. These are natural resources, cultural and historical heritage, created resources and supporting resources (infrastructure, quality of service, friendliness of people, etc.). The second part considers situational conditions, which represent external factors that may affect TDC. These include political, economic, technological, legislative, demographic, social, and other factors. The model also refers to demand, which includes the characteristics of demand and created and supporting destination resources, as well as a destination’s competitiveness. A special segment of this model of TDC is destination management, which includes the activities of tourism and marketing organisations, destination-management organisations (DMOs), policies, strategies, human resources, and so on. Tourist destination management directly affects created and supporting resources on one hand, and competitiveness of the destination on the other.
Ritchie and Crouch (2003) are also among the leading researchers who have dealt with the nature and structure of TDC. Their model of TDC – the Conceptual Model of Destination Competitiveness – includes five key indicators: tourism, planning and development policy; qualifying and amplifying determinants; destination management; core resources and attractors, and supporting factors and resources. It also takes into account the impact of global forces that come from the macro-environment, as well as the impact of the competitive micro-environment (Ritchie and Crouch, 2003;Dragičević et al., 2012). Ritchie and Crouch’s model focuses on the following competitive factors: the attractiveness of the destination; destination management, which includes sales and management efforts; the organisation of the destination, which includes organisational structure and strategic alliances; destination information, regarding information systems and research, and finally, destination efficiency, measured by the relation of prices to quality and productivity. The authors particularly emphasise the importance of information as a basis for decision-making for managers in tourism: destinations that collect and use information effectively are considered fit to improve their competitive positions (Vodeb, 2012). Ritchie and Crouch defined 36 tourist competitiveness determinants, categorised according to the five key indicator groups mentioned above (2003):1Core resources and attractors: special events, physiography and climate, culture and history, mix of activities, entertainment, superstructure, market ties; Supporting factors and resources:infrastructure accessibility, facilitating resources, hospitality, political will; Destination policy: planning and development, system definition, philosophy/values, vision, positioning/branding development, competitive/collaborative analysis, monitoring and evaluation, audit; Destination management: organisation, marketing, quality of service/experience, information/research, human resource development, finance and venture capital, visitor management, crisis management, resource stewardship, and Qualifying and amplifying determinants: location safety/security, cost/value, interdependencies, awareness/image, carrying capacity (Crouch, 2011)
On the other hand,De Keyser and Vanhove (1994) argue that the analysis of the competitive situation should include five groups of competitive factors in the areas of: tourism policy; macroeconomics; supply; transportation, and demand. This allows the involvement of external factors, particularly governmental policy, in analysing competitiveness. Although they do not propose a universal model, their methodology for measuring tourist competitiveness has been applied in various cases.
The WEF has defined a special methodological approach to investigating macro-destination (country) tourist competitiveness, the TTCI. This andis a newer methodology, which includes 14 competitiveness determinants (pillars) grouped into four sections: Enabling Environment; Infrastructure; Natural and Cultural Resources; Tourism and Travel Policy and Enabling Conditions. An in-depth analysis of TDC is carried out for 136 countries every year, which is then summarised and published as the Travel and Tourism Competitiveness Report. This report is a very useful tool for the tourist industry overall, especially for stakeholders and decision makers (WEF, 2017).
It is clear that each of the TDC models presented above is very complex. Furthermore, there are a number of limitations that prevent a full comparison or listing all TDC determinants.
Previous research regarding tourism competitiveness
In this part, carefully selected and relevant tourism competitiveness research is presented, with a focus on regional analysis. There is a specific section dedicated to previous research about Montenegrin tourism competitiveness.
Gândara et al. (2016) deal with evaluation of destinations with the help of pillars of competitiveness for the example of Brazil, with the intention of improving the competitiveness of Brazil as a tourist destination in terms of policy.Andrades and Dimanche (2017) use Ritchie and Crouch’s Model and TTCI to investigate the competitiveness of Russia, drawing the main conclusion that Russia has great potential for tourism development but it is not exploited at all.
García Sánchez et al. (2016) address TDC and innovation. Using a wide range of indicators, these authors seek to identify the main sources of TDC for the example of the Spanish Mediterranean coast. They conclude that the most important factor in competitiveness is specialisation, followed by services, tourists’ satisfaction, culture, attractions and weather.
Huybers and Bennett (2003) have studied the impact of environmental management / environmental competitiveness of tourist destinations, with specific reference to Tropical North Queensland. They come to a conclusion that caring about environmental protection and environment management can greatly enhance the competitiveness of tourist destinations.Mihalič (2000) specifically addresses the issue of competitiveness related to the environment/surroundings in terms of management, concluding that the environmental aspect of a destination’s competitiveness can be improved through adequate management.
Navickas and Malakauskaite (2015) point out that TDC includes a number of factors, both natural (geographic location, climate, and natural beauties) and manmade (tourism infrastructure, transport, ancillary facilities, shops, hotels), as well as the globalisation of markets. They connect TDC with a country’s economic development and come to the conclusion that there is a strong correlation between economic growth and TDC.
Škare and Tomić (2014) state that the economic development of a country is an indicator of innovation: innovation-oriented destinations are more competitive and assure better economic results, faster economic growth (Škare and Tomić, 2014). This depends on demographic trends (Škare and Blažević, 2015) and human capital (Škare and Lacmanović, 2015).
Omerzel (2006) examines the competitiveness of Slovenia as a tourist destination. Based on her research, she concludes that certain factors of competitiveness receive more prominence and are valued more highly, such as gastronomy, opportunities for relaxing, accommodation, natural resources etc.Gomezelj and Mihalič (2008) have examined the competitiveness of the same destinations and identified that Slovenia is more competitive in terms of natural, cultural and other resources, rather than on the basis of the management of destinations. For their research, these authors used De Keyser–Vanhove’s model of TDC. The results indicate that there is a great deal of room for improving the competitiveness of Slovenia in the field of artificial resources.
Knežević Cvelbar et al. (2015) examine the relationship between productivity and level of TDC. They use a set of 55 indicators for 139 countries and come to the conclusion that specific factors relating to tourism, such as tourist infrastructure and destination management, are the main source of competitiveness in developing countries, and that apart from destination management, infrastructure is extremely important in general, as well as the macro environment and business environment.
Armenski et al. (2012) deal in their study with a comparison of the indicators of TDC in Slovenia and Serbia. They come to the conclusion that improvement of management is needed in both destinations because managers should continuously provide added value, and in terms of demand conditions, special promotional activities are also needed in order to build a better image and wider regional appeal.Kovačević et al. (2018) analyse the TDC of the South Banat district (Serbia) by using the Ritchie and Crouch model. They conclude that this region is not competitive despite having numerous advantages, but these results could be useful for destination management.
Bosnić et al. (2014) explore the competitiveness of Croatia as a tourist destination and conclude that the role of destination management is important for strengthening the competitiveness of the destination and strengthening the Croatian tourism product.Bagarić and Žitinić (2013) examine the competitiveness of the Croatian region of Kvarner and their findings identify that natural and manmade resources are stronger factors of TDC, while they rank destination management lowest among the factors of competitiveness.
There are not many studies that analyse Montenegrin tourism competitiveness, although some do exist. For instance,Cimbaljević and Bučić (2015) analyse the competitiveness of Montenegro using TTCI. They conclude that Montenegro as a tourist destination has a number of primary elements (varied offer in a small place, culture, tradition, history, climate) that could serve the function of tourism.Moric (2013) stresses the importance of IT and intelligent systems in improving the competitiveness of the Montenegrin economy, whileTodorović (2014) comes to the conclusion that sustainable development of tourism is the key factor of Montenegrin competitiveness.
In summary, many studies examine the impact of certain factors on the competitiveness of a destination. It is evident that a large number of destinations have not managed to use natural and created resources in the best possible way to strengthen their competitive positions.
On the basis of the key competitiveness model that was established byRitchie and Crouch (2003), the determinants of competitiveness in the case of Montenegro will now be studied. We will consider which determinant is the most critical and must be improved with the most urgency.
The assumption is that destination management plays the main role in both existing and future development, representing a competitiveness determinant of crucial importance. The results of the research shall reveal whether the assumption is correct and which elements of destination management must be improved.
SAMPLE AND METHODOLOGY
An interview-based method was used for the needs of this paper. Seidman states neatly: ‘I am interested in other people’s stories. Most simply put, stories are a way of knowing’ (2013, p.7). The aim of this study is to gather and analyse expert opinions on Montenegro’s level of TDC and to determine the crucial factors that should be improved upon in order to enhance it.
A total of 22 experts were interviewed, selected through purposive sampling, which can be defined as a type of non-probability sampling that is more effective than random sampling (Tongco, 2007;Bernard, 2002). In this case, expert sampling was used. The 22 experts interviewed were drawn from the fields of tourism and hotel management, and primarily the field of destination management, with expertise in economy, state administration and higher education. Expert sampling is homogeneous sampling, for which a sample size of 11–20 experts is recommended (Crouch and McKenzie, 2006;Guest et. al., 2006;Latham, 2013). Since 22 experts were interviewed, it can be stated that the sample for this research is valid and relevant. The privacy principle (King and Horrocks, 2010) was respected by using the computer-assistance interview (CAI) model (Gubrium and Holstein, 2002). The rate of questionnaire fulfilment was 100%. The interviews were conducted between January 2018 and March 2018.
The sample structure is presented inTable 1.
Source: Authors
The average work experience (24.72 years) of the chosen experts supports the thesis that our sample is valid.
The interviews were of a structured type. A total of 42 questions were defined. The questions were divided in two parts: a specific part, consisting of 37 questions, and a general part, consisting of five questions. In the first part of the interview the experts were tasked with evaluating certain destination segments with marks from 1 to 5 (1 – insufficient, 2 – sufficient, 3 – good, 4 – very good, 5 – excellent), and in the second part they were asked to provide their personal information. The first part of the questionnaire was conceived based on Ritchie and Crouch’s model of TDC (2003).
The gathered data were processed by statistical analysis. For the presentation of the results, descriptive statistics, mean values, factorial analysis, correlation, regression, and T test were used.
Based on the mean values, the critical points of competitiveness of Montenegro as a tourist destination will be highlighted. The obtained will then be compared with the results of similar research conducted by other researchers.
Ritchie and Crouch (2003) have provided 36 determinants and classified them into five categories, as was explained in the literature review section. The authors shall use this model and, by applying factorial analysis, they shall classify the expert opinions as suggested byRitchie and Crouch (2003) in order to obtain integrated results for all five categories. This will enable more complex analysis to be conducted.
Using correlation and regression, we will determine whether the experts’ grades are affected by their demographic features, mainly their number of years’ work experience and their level of education.
The results are presented in the following section.
RESULTS AND DISCUSSION
The experts assessed the determinants of TDC as presented inTable 2.
By taking a closer look at the mean grades for the given categories (Table 2), it can be seen that destination management has the lowest grade (M= 2.8182), while qualifying and amplifying determinants have the highest one (M=3.7500). Core resources and attractors are marked with 3.4871, supporting factors with 3.2197, and policies, plans and tourist development with 2.9716. It can be concluded that the critical point of competitiveness of Montenegro as a tourist destination is actually the management of tourist destination, similar to the cases of Russia, Slovenia, Serbia, and Croatia (Armenski, 2012;Mihalič, 2000;Chen et al., 2016;Knežević Cvelbar et al., 2015;Bosnić et al., 2014;Bagarić and Žitinić, 2013;Omerzel, 2006;Gomezelj and Mihalič, 2008;Kovačević et al., 2018;Cimbaljević and Bučić, 2015). Our research confirms that better destination management, i.e. professional management, is necessary. The experts evaluated that Montenegro is greatly dependent on the countries surrounding it, which means that Montenegro is not an independent tourist destination. As a small, undeveloped country, it is quite difficult for Montenegro to compete alone. On the other hand, there are no joint products designed by Montenegro and the surrounding destinations: this is a significant disadvantage. Networking should be developed and mutual efforts should be made in order to improve the TDC of all neighbouring countries
When considering all categories would be separately, a very important paradox can be noted. Natural destination resources and cultural-historical heritage is graded as a crucial source of destination competitiveness, while natural and cultural-historical resources management has received an extremely poor grade. Thus, in addition to generally poor destination management, special focus must be placed on management of natural and cultural destination resources, which is also pointed out by authorsMihalič (2000) andHuybers and Bennet (2003). The correlation coefficient between the categories of destination management and destination policy, plans and development (Spearman’s r=0.832, p=0.000) shows that poor destination management is a result of policy and planning issues. By applying factorial analysis, the stated categories have been reduced to one, which is proposed by the Ritchie and Crouch’s model. The correlation coefficient cover the range -1 to 1, and in this case t is r=0.832, which, according toCohen (1988), represents an extremely strong positive correlation. The percentage of the mutual variant is 69.22 (r2 x 100), which points to the statistical significance of the examined correlation. These results correspond to the conclusions ofHuybers and Bennett (2003), who accentuate the importance of destination management to strengthen the competitiveness of tourist destinations, as mentioned in the literature review section. It can be observed that visitor management and crisis destination management are very poorly graded, and the question arises whether these tools of destination management are even used. The destination capacity is precisely calculated in previous studies on tourism development, but newer strategic documents mention neither this factor, nor visitor and crisis management. They also fail to mention management of natural and cultural destination resources, which is particularly problematic.
The experts have sorted the TDC determinants by relevance in the following ways: 1. Core resources and attractors; 2. Destination policy, planning and development; 3. Destination management; 4. Qualifying and amplifying determinants, and 5. Supporting factors and resources.
We shall now examine whether the total mean experts' grade depends on demographic features – that is, sex, age, work experience, education, and activity sector – by applying standard multiple regression.
The results of the regression analysis are presented inTable 3.
Source: SPSS Output
InTable 3, the values of ‘sig’ (p) are observed. In this case the value of p=0.031<0.05, which means that the model is justified; that is, that experts' grades depend on their demographic features. This model explains the 50.7% variance, which is a satisfactory result. The results of the ANOVA test (p=0.031<0.05) confirm that the proposed model is valid. The gender and activity sectors carry the largest beta coefficients and ‘p’ values. In this respect, these are the most significant coefficients of our model. To sum up, the experts' grades depend on age, education, work experience, and most strongly on the sex and activity sectors.
In addition, our findings differ from many authors, who come from countries that have been affected by the transition relatively late, in that we are stressing the importance of management at the destination, which can be considered to be one of the most important reasons for the lack of a destination’s competitiveness. It should be borne in mind that the transition of the tourism sector and other parts of the economy in Montenegro has not been completed. Since the decentralisation of the economy, natural resources have been extremely and uncontrolled used, and small and micro enterprises, which are dominant in the tourist industry in Montenegro, are still weak and do not have the negotiating skills to resist a highly competitive and dynamic market. In this regard, we believe that the findings of this research may be useful for researchers from countries with a similar level of economic development, since a universal model for measuring competitiveness does not exist due to the peculiarities of each destination.
Additional investments in created and supporting resources, adequate management of tourist destinations, and promoting the protection of natural and cultural resources are indispensable for improving Montenegro’s TDC. AsNavickas and Malakauskaite (2015) have noted, the overall economic development and competitiveness of tourist destinations go hand in hand. Montenegro’s lower level of TDC can be attributed not only to destination management, but also to the modest economic development of Montenegro, as evidenced by numerous indicators. The fact that Montenegro has lower production, but high import levels of products and raw materials, significantly influences the development of tourism and TDC.
CONCLUSION
Measuring the determinants of competitiveness for Montenegro as a tourist destination is a challenge for its management at all levels. From the factors stated above, it can be seen that its level of competitiveness depends on a number of factors. Every factor should be considered, in particular because all the factors or determinants of competitiveness are interconnected. If one link in the chain is not functioning, it is clear that the whole process could stall. The survey results show which segments of Montenegro need urgent improvement. Our findings can be used for future research on this and similar topics, especially in countries of similar levels of economic and social development. Furthermore, this study has set the foundations for improving the tourist offer of Montenegro and strengthening its competitiveness. It should be kept in mind that tourism is a specific activity, which represents the sublimation of a wide range of activities. This means that the origins of Montenegro’s competitiveness in tourism must be sought in activities that are indirectly included in the travel system (transport, agriculture, trade, production, etc.). In order to measure Montenegro’s TDC, it is necessary to adopt a model of measurement that will include all segments of the tourism industry and establish a set of relevant indicators.
Consideration of the reports of worldwide organisations and monitoring trends in the environment should, of course, not be neglected. By conducting measurements and comparing these with those of foreign institutions, a realistic picture of Montenegro as a tourist destination can be obtained and the key determinants of its competitiveness can be identified. Enhancing the competitiveness of Montenegrin tourism should be an obligation and responsibility of the whole country: the local community, governing bodies and the economy. Only by means of joining forces to achieve constant monitoring of the ‘heartbeat’ of the market, with careful planning and controlled implementation of plans, can the potential of Montenegro for tourism purposes be fully realised, as well as hopes for a better position in the tourism market.
On the other hand, natural, cultural and supporting resources are significant elements for determining the character and competitive advantage of destinations. The characteristics and specifics of natural and cultural resources are factors that make a destination recognisable and unique, differentiating it from other, competitive destinations. Based on these resources, the destination can establish its position in the global tourist market, pointing out its natural, cultural and human advantages as compared to other destinations. Creating a recognisable image of tourist destination through strong promotion of its specific resources for tourists is the best way to make the destination stand out as unique and different from others. One of the most important advantages of Montenegro as a tourist destination lies in the fact that it is a relatively small destination, characterised by the heterogeneity of its natural and cultural resources in such a small area. Unfortunately, this competitive advantage is still not fully valued.
Bearing in mind that sun and beach tourism is still the dominant type of tourism in Montenegro, and that this kind of tourist offer is present in many destinations around the world, Montenegro cannot rely on basing its competitiveness only on being a coastal tourist product. It is necessary to establish a creative and innovative tourist product, which could combine the natural and cultural resources of both coastal areas and mountain hinterland, in the form of event organising, short excursions, themed tours, amusement parks, etc. Opportunities for interweaving of different types of tourism, based on sustainable development and the ecological image of the destination, is a competitive advantage by which only a small number of destinations are characterised, one of which is certainly Montenegro. In order to properly exploit these opportunities, create a comprehensive tourist product and ensure stronger a competitive position in the wider tourist market, apart from the valuable natural and cultural resources of Montenegro and the basic factors of a destination (receptive base and traffic infrastructure), adequate human resources are of vital importance as well. In order to ensure destination sustainability, visitor management and crisis management must urgently be established. Considering the fact that certain destinations have already felt the negative effects of tourism on the environment, measurement of destination capacity is necessary in Montenegro in order for visitor management to function well.
Although Montenegro’s TDC is determined by innovations generally present in the economy of the country, the success of its competitive positioning depends to a large extent on the quality of its human resources, their motivation and creativity, and their approach to innovations. It is indisputable that the role of workers has a very important place in the process of achieving a competitive advantage in the tourism market. This is the reason why modern tourist destinations are more and more focused on the improvement of their human resource strategies. Following these trends, Montenegro should work on the implementation of integrated human resource management, which should be based on creativity and encouraging of innovation.
In order to achieve higher levels of TDC, cooperation is necessary between all subjects involved in the creation of the tourist offer: employees in the service sector; management at all levels; the non-governmental organisation (NGO) sector; local tourism organisations (LTOs); regional tourism organisations (RTOs); national tourism organisations (NTO), and the government. Only with this comprehensive approach to tourism can it be possible to completely satisfy modern tourists, who are looking for active holidays, new life experiences and unique ways of experiencing tourist destinations. Thus, strengthening the competitiveness of the Montenegrin tourist market is the task of all participants in its tourism system.
The arrival of new investment, economic stability, social security and education, aimed towards sustainable development, are the basis for improved competitiveness, where the state has an important role in establishing administrative, economic and all other frameworks, especially in a time of transition. These are certainly fields that need to be challenged for further direction of analysis in this field.
RECOMMENDATIONS FOR FURTHER RESEARCH AND LIMITATIONS
This research could be enriched and improved by asking the experts to rank all 36 determinants for TDC by relevance. In addition, we have examined the determinants/sources of Montenegro’s TDC, but we have not examined how those determinants influence its tourism industry’s productivity. We have presented our research as a strong base for further research in this area, and particularly for research on the level of micro destinations and/or clusters in Montenegro.