Factors affecting the efficiency of human resource utilization in shopping centre management

Abstract

One of the key factors that determines the success of a shopping centre is how efficient are its human resources utilized to maximize its value. This study investigates how corporate business strategies, as reflected in the perceptions and beliefs of shopping centre managerial staff, affect management efficiency, which is defined as efficiency of human resource utilization in shopping centre management.

We measure the management efficiency of a shopping centre’s management by comparing inputs and outputs using Data Envelopment Analysis (DEA). The inputs are defined as the different types of human resources utilized to manage a shopping centre, while outputs are measured by the rental value per floor area holding a range of exogenous factors constant. These exogenous factors include location attributes and physical characteristics of the shopping centres. Data on inputs and the beliefs and perceptions of managerial staff at different levels were collected by questionnaire surveys followed up by telephone calls and interviews.

We collected data from 106 shopping centres located along the Mass Transit Railway lines. At the strategic level, we found that management that focused on satisfying the needs of shoppers rather than those of tenants was more efficient. However, whether management adopted a centralized or decentralized approach to shopping centre management had no impact on management efficiency. Management that aimed to maximize short term rental income and that which focused on achieving longer term branding effects had similar levels of management efficiency.

For leasing and marketing management, we found that management that focused on achieving a planned optimal tenant mix was more efficient. Contrary to most people’s beliefs, management that believed in maximizing customer flow was less efficient. Our empirical data also suggested that the professional qualifications of leasing and marketing staff were not important as far as the efficiency of shopping centre management was concerned.

At the operational level of property and facilities management, we found that shopping centres were more efficiently managed if management at this level believed that professional qualifications were important for property and facilities management, which was in sharp contrast with the findings for leasing and marketing management. We also found that management that aimed to control costs within budget and that which aimed to create value did not differ significantly from each other in terms of management efficiency. Finally, although property and facilities management were at the technical level of overseeing the physical structure, management that believed in satisfying users’ needs more than merely maintaining the physical conditions of the property tended to achieve higher management efficiency.