Practical Business Strategies Independent Quick Service Restaurants Use to Sustain beyond Five Years ()
1. Introduction and Background
More than 77% of newly established small businesses survived only one year, and less than 64.5% failed to survive beyond the first 5 years of business (U.S. Bureau of Labor Statistics (BLS), 2015; U.S. Small Business Administration (SBA), 2016). SBA defined small businesses as independent establishments that employ fewer than 500 employees that purposely seek profit (Parsa et al., 2015). Quick-service restaurants are small business establishments where patrons order and purchase food from the counter before consuming it (U.S. Census Bureau (USCB), 2015). Quick-service restaurants account for more than 233,392 small business establishments across the United States (USCB, 2015).
Quick-service restaurants accounted for more than 2014 restaurants in Little Rock, Arkansas, employing 46,122 Arkansans (USCB, 2016). According to a 2013 to 2017 report obtained from the Department of Environmental Health Protection at the Arkansas Department of Health (ADH), more than 100 independent quick-service restaurants close on average each year or become inactive in Little Rock, Arkansas. Independent quick-service restaurants are independently owned and not affiliated with a franchise. The high closure average of the independent quick-service restaurants has a detrimental effect on local economies (Parsa et al., 2015). As a result, this study aimed to explore the strategies that successful independent quick-service restaurant owners used to sustain business beyond their first 5 years. This article is organized by section 1: abstract, purpose statement, research question, assumptions, limitations, delimitations, the significance of the study, and review of the academic literature. Section 2 includes the analysis and data collection. Section 3 includes the summary of the findings.
2. Purpose Statement, Research Question, Assumptions, Limitations, and Delimitations, Significance of the Study
2.1. Purpose Statement
This qualitative multiple case study aimed to explore the strategies that independent quick-service restaurant owners used to sustain business beyond the first 5 years. The population of this study included six successful independent quick-service restaurant owners in Little Rock, Arkansas, who used effective strategies to sustain their business beyond the first 5 years of operation. The study’s findings may provide independent quick-service restaurant owners with the strategies necessary to increase their survival rate. As a result, independent quick-service restaurant owners may improve job sustainability, enhance human capital development, and encourage job creation to support the welfare of the citizens in Little Rock, Arkansas.
2.2. Research Question
What strategies do independent quick-service restaurant owners use to sustain business beyond the first 5 years?
2.3. Assumptions
Assumptions are beliefs or hypotheses about the research that lack evidence or verification (Chandler, 2013). The primary assumption was the participants would be forthcoming and honest in responding to the interview questions in a controlled setting. I assumed that independent quick-service restaurant owners have never considered how to use their internal resources to leverage competitive advantage. I assumed that independent quick-service restaurant owners did not know how to leverage their internal resources to create a sustained competitive advantage. In essence, they did not know how to increase the value of their internal resources to enhance their service performance while mitigating external threats. Additionally, I assumed that independent quick-service restaurant owners did not have a formal way of collecting and analyzing the data from their internal resources to make optimal business decisions to innovate or enhance their operations. Lastly, I assumed that independent quick-service restaurant owners did not have a formal way of analyzing their competitor’s internal operations to determine ways to outperform them.
2.4. Limitations
Limitations are constraints that could lead to potential weaknesses and challenges in a research study (Brutus et al., 2013). There were two limitations in this study. First, the study results may have been different if the scope of the research included other geographical locations and included a larger population. The second limitation was the research design. The design used in this research was a qualitative multiple case study. The sample size was small but practical for the research method.
2.5. Delimitations
Delimitations are factors that limit the scope of the research study or restrict the boundaries (Ody-Brasier & Vermeulen, 2014). There were two delimitations in this study. The first delimitation of the qualitative multiple case study included only the geographical location, Little Rock, Arkansas. The second delimitation was the targeted audience for the research. The delimitations may prevent generalizing the results across other independent quick-service restaurant owners, consequently, making problematic transferability of results to other business owners (Ody-Brasier & Vermeulen, 2014).
2.6. Significance of the Study
The results of my study might provide independent quick-service restaurant owners with the necessary methods to successfully sustain business beyond the first 5 years. The strategies that I gained from the research may assist independent quick-service restaurant owners to analyze and evaluate their internal resources to create a sustained competitive advantage. My findings may provide independent quick-service restaurant owners with strategies necessary to increase their survival rate and, as a result, aid in job sustainability and encourage job creation.
2.7. Contribution to Business Practice
The results of this qualitative multiple case study contribute to strategies that independent quick-service restaurant owners use to leverage their internal resources. The findings may help independent quick-service restaurant owners use their inner resources to develop operational efficiencies and cost savings. The findings may also help quick-service restaurant owners valuate their tangible and intangible internal resources and those of their competitors to aid in business survival. Finally, the research results may also provide independent quick-service restaurant owners with a blueprint to establish a sustainable competitive advantage amongst local competitors in Little Rock, Arkansas, preventing business closures, job layoffs, and economic downturns in local communities.
2.8. Implications for Social Change
Positive social change is the concept of intentionally committing to finding ways to transform societal well-being inside and outside the boundaries of an organization (Stephan et al., 2016). This qualitative multiple case study’s implications for positive social change include business sustainability and growth for independent quick-service restaurants, leading to job creation and human capital development. Business sustainability and growth contribute to increased customers, employee retention, talent acquisition and development, and profitability (Al Mamun & Hasan, 2017). Leaders who use strategies to create business sustainability and growth encourage job creation, support local citizens’ well-being, and transform local economies (Kongolo, 2010). Another contribution to positive social change may be the investment in human capital. Internal resource dynamics contribute to developing existing and acquired human capital (Teece, 2000). Strategic diversification of internal resources leads to employee training, education, certifications, and advancements. A company’s best investment is in its human capital (Teece, 2000).
The results of this qualitative multiple case study include strategies necessary to increase the survival rate of independent quick-service restaurants. Leaders may use this study to promote job sustainability and encourage job creation in local communities. The implications for positive social change include business sustainability and growth for independent quick-service restaurant owners.
3. Review of the Academic Literature
3.1. Resource-Based Theory
The RBT is a clear perspective on organizational science, strategic management, and the science of entrepreneurship (Kellermanns et al., 2016). Barney (1991) established the RBT in response to the research question of why certain firms outperform others. Some leaders of firms outperform other leaders by leveraging their internal resources to create a sustained competitive advantage (Barney, 1991; Campbell & Park, 2017; Wernerfelt, 1984).
The RBT extends earlier resource-based theories and Porter’s (1980) value chain model. Penrose (1959) asserted that the firm’s objective is to know the limits of its bundled internal resources and leverage them for its growth. Penrose identified resources as internal intangible and tangible resources owned by the firm. Campbell and Park (2017) and Wernerfelt (1984) discovered a firm’s resources were labor, capital, and perhaps land. However, Penrose used a broader lens to view a firm’s resources. Penrose’s concept of the RBT was that a firm’s bundled internal resources and coordinated activities sustain and grow the firm. A firm is heterogeneous because of its bundled resources (Barney, 1991; Penrose, 1959). Penrose (1959) postulated that the source of a firm’s competitive implication is how owners of a firm coordinate their activities. Wernerfelt advanced the RBT by evaluating a firm’s internal resources and its ability to use them to achieve economic rents and sustained competitive advantage. Wernerfelt’s theory was the first resource-based theory published in the strategic management literature (Barney, 1991). Wernerfelt posited that firms operated in imperfect markets because their internal resources were heterogeneous, and some of their resources were immobile.
Before RBT, scholars argued that resources owned by a firm were homogeneous and mobile (Hatten & Hatten, 1987; Wernerfelt, 1984). Scholars advanced that internal resources could be competed away by competitors; therefore, they were not sources of sustained competitive advantage (Wernerfelt, 1984). Barney (1991) posited that not all stretched resources are homogeneous and mobile. Compared to other similar firms, most resources of a firm are heterogeneous, and some resources are imperfectly immobile. Resources that are heterogeneous and immobile have the potential to be sources of sustained competitive advantage; resources of a firm that are not heterogeneous and immobile cannot be sources of sustained competitive advantage (Bromiley & Rau, 2016; Davis & Simpson, 2017). Barney (1991) theorized that diversified resources could create rents for firms and sustain competitive advantage. Wernerfelt (1984) viewed internal resources as a source of diversification, which could have a strategic implication (Barney, 1991). Unlike the resource-based theories of the firm, Porter (1980) analyzed the internal resources of a firm from the value chain and internal compartmental perspective.
The value chain is how a business converts raw resources into valuable products for market consumption (Porter, 2011). The value chain consists of two distinct activities that create value for products: primary and secondary (Simatupang et al., 2017). Porter (1980) stated that a firm’s primary activities include inbound logistics, production, outbound logistics, marketing and sales, and services. The secondary activities include firm infrastructure, human resources, technology, and procurement. An integrated effort of all the value chain components to create a valued product for market consumption is necessary. However, Barney (1991) argued that Porter’s value chain model does not provide a systematic framework for analyzing internal resources to determine their value. For example, Porter does not specify whether the indiscriminate valuable resources are human capital, technology capital, or organizational capital.
Leaders of firms create value through the internal resources controlled by the firm. Barney (1991) described resources as only those held by the firm. Greene et al. (2015) explained that the internal resources of a firm include 1) physical resources, 2) financial resources, 3) technological resources, 4) human resources, and 5) organizational resources. Greene et al. (2015) posited that the physical capital of a firm includes 1) geographical location, 2) equipment, 3) supplies, and any raw materials. The organizational capital of a firm comprises 1) intellectual property, 2) leadership, 3) tacit knowledge, 4) business acumen, 5) culture, and 6) relationships with customers, employees, and vendors. The financial capital resources of a firm include 1) economic value, 2) operating budgets and profits, 3) investments, return on investments, and 4) return on human capital. The firm’s human capital includes the leader’s business acumen, the leader’s ability to dive performance, the leader’s relation with the employees and customers, the employees, the employees’ talent, and the employees’ development. The technological capital of a firm includes 1) technological prowess, 2) ownership of business technology such as point-of-sale technology, and 3) computer accessories (for example, software), websites, and social media platforms. These five types of internal resources owned by a firm have the potential for generating a sustained competitive advantage when they can improve the efficiencies and effectiveness of a firm’s outcomes while mitigating threats.
The internal resources of a firm include both tangible and intangible resources, but the intangible resources are the least understood and, if explored, can help sustain a competitive advantage (Davis & Simpson, 2017). Barney (1991) claimed that a sustained competitive advantage is not measured on the same criteria as a competitive advantage. Porter (2011) described competitive advantage as the ability of a company to outperform its competitors over a calendar period in which the company with the competitive advantage earns greater profitability. Porter (2011) articulated that the fraction price determines profitability over cost. A company has a competitive advantage when its profits and shareholder value exceed those of comparative companies over time (Barney, 1991; Mathooko & Ogutu, 2015). A sustained competitive advantage is the inability of a close and competing company to duplicate the complexity of another company’s resources.
A firm’s leaders can leverage their internal resources and create a sustained competitive advantage for a firm. López-Cabarcos et al. (2015) articulated that the RBT can assist in examining the value and rareness of internal resources such as human capital, technology capital, and organizational capital to determine how to use them for a sustainable competitive advantage. Campbell and Park (2017) explained that the RBT involves bundling internal resources and exploiting them to create a sustained competitive advantage. Bundling combines internal resources to develop a stronger derived value for the customer (Barney, 1991; Gibbons & Kaplan, 2015). Barney (1991) theorized that owners of firms could create bundled resources by analyzing their resources using the value, rare, imitable, and nonsubstitutable (VRIN) systematic framework. Barney argued that the RBT provides a framework that leaders of firms can use to systematically analyze and evaluate their internal resources through the lens of valuable, rare, difficult to imitate, and nonsubstitutable attributes to create a sustained competitive advantage (Bromiley & Rau, 2016; Davis & Simpson, 2017).
3.2. Small Business Industry
The small business industry is an economic driver that is vast and dynamic (Tchamyou, 2017). Small businesses in the United States have the most active sector in the business industry (Decker et al., 2014). The small business sector comprises paid employees, non-employee firms, and exporting firms (SBA, 2016, 2018a). Ninety-nine percent of small businesses have paid employees, 97.9% are exporting firms, 47.5% are private-sector employees, and 40.8% are responsible for 40.8% of private-sector payroll (SBA, 2018b). Small businesses have infused more than 55% of new jobs into the economy (USCB, 2015; SBA, 2016, 2018b). SBA defines small businesses as independent establishments that employ fewer than 500 employees, do not pose a dominating threat in the field, and purposely seek profit (Parsa et al., 2015).
Owners of small businesses play a vital role in the growth of local, national, and international economics (Ribeiro-Soriano, 2017); they add value to the economy by providing the world’s exporting, patents, and innovation. Ninety-seven percent of small businesses in the United States are responsible for all the nation’s shipping (USCB, 2015). Small business exporters create a robust and viable economy (USCB, 2015). Small business owners build value for the economy through patents. Small business owners choose patent production to separate themselves from their competitors and establish a competitive advantage (Akcigit & Kerr, 2018). Patent production in small businesses creates value for international and national economies (Akcigit & Kerr, 2018; Hovhannisyan & Keller, 2015). In 2010, small business owners were responsible for one-third of all patent productions (SBA, 2016).
Small business owners contribute more innovative products to the economy than larger businesses. Innovation is a source of competition, subsistence, and economic stability for small businesses. Innovation is a new ideal and transforming abstract concepts into new creations (Jardon, 2016). Innovation is the engine behind the success of small businesses (Jardon, 2016). Small business owners who produce innovative products have more financial success and freedom (Zulu-Chisanga et al., 2016). Small business owners create vital and competitive economies through exporting, innovation, and patent production (Memili et al., 2015). Porter (2008) explained that competition heightens in industries with small businesses. Owners of small companies influence the economy via stimulating job creation and economically growing and developing international, national, and local markets.
3.3. Successful Small Business Strategies
For decades, small businesses have been the cornerstone of vibrant national and international economies (Decker et al., 2014; Memili et al., 2015). Small business owners have influenced local economies with massive job creation and global markets with strategic marketing and growth and development strategies (BLS, 2015; Porter, 2008). More than 20 million small businesses in the United States are responsible for 63% of all new jobs created in America (SBA, 2016; USCB, 2015). As a result, the success of small businesses is vital to economic stability, socio-economic development, and growth.
Business strategic plans. Small and large business owners use business strategies to organize projects, differentiate themselves from their competitors, and set their strategic horizons (Ibrahim, 2015). The Harvard Business School in the 1920s is the first formal academic treatment of the subject of strategic planning as a process that looks at long-term planning (Candy & Gordon, 2011; Davis & Simpson, 2017). Akkermans and Van Oorschot (2018) described strategic planning as a management process used to bridge together multiple financial and non-financial functions and activities to advance a firm strategically. Ensari (2016) argued that the essence of strategy formulation is to identify a unique position in the market and establish a new and separate set of activities to achieve unique and other results. Olubunmi et al. (2014) and Davis and Simpson (2017) posited that strategy conceives through the lens of three parts: differentiation, focus, and overall cost leadership. A strategy is a management process that integrates the perspectives of financials, customers, operations, and human capital, including technology capital and cultural capital, to create a manageable, sustained competitive advantage for a firm (Akkermans & Van Oorschot, 2018).
Researchers found that there are multiple frameworks and tools to build a business strategy. Porter (1980) explained that leaders, managers, and business owners who use the competitive strategy framework seek to be the more favorable and dominant in their markets. Porter’s competitive strategy framework identifies three methods for building strategies: overall cost leadership, differentiation, and focus (Ensari, 2016; Porter, 1980). Leaders of firms compete for industry superiority through trading off non-competing positions in the market while competing for either overall cost leadership, a differentiation position, or a focus position (Porter, 2008). Porter (1980) stipulated that companies gain a competitive advantage through strategic positioning and choosing a unique set of activities that differ from their competitors. Leaders use overall cost leadership strategies to attract cost-sensitive customers (Ensari, 2016). Owners of small and large firms who use the overall cost leadership strategy provide low-cost products at a reasonable price (Porter, 1980); they tend to compete on pricing and target cost-sensitive buyers (Ensari, 2016). Owners of small and large firms use differentiation strategies to attract customers willing to pay premium prices for products and services (Porter, 1980). Business owners who use differentiation strategies offer customers high-quality products and services deemed better than their competitors (Porter, 1980).
Contrary to differentiation strategies, business owners use Blue Ocean Strategies (BOS) to chart their own independent, non-competitive path and Platform strategies to leverage existing resources not owned by the firm to create a competitive advantage. Agnihotri (2016) explained that BOS seeks to make the competition irrelevant. Therefore, BOS is non-disruptive because practitioners of this framework expand markets without taking market share (Parker et al., 2016). Agnihotri (2016) postulated that people design platform strategies to coordinate tasks between consumers and producers. Business owners who use Platform Strategies use the existing resources of non-employee producers to provide a quality service to customers (Fung et al., 2007). Business owners develop technical applications that centralize interactions and transactions between consumers and producers (Agnihotri, 2016); these business owners create viable and profitable network markets where consumers and producers can trade roles and engage in transactions (Fung et al., 2007).
3.4. The Restaurant Industry in the United States
The restaurant food service and drinking industry is the largest industry in leisure and hospitality in America, adding 1.3 million jobs to the economy between 2010 to 2014 (BLS, 2014). According to the 2015 USCB, there are 476,492 restaurants in America with more than 9,292,093 employees. In 2015, the annual payroll for restaurants in America was $154,509,536 (USCB, 2016). The main two classifications of restaurants are full-service and quick-service restaurants. Owners of full-service restaurants offer unique and high-quality food at a premium price. On the other hand, full-service restaurants are considered casual and fine-dining establishments where patrons pay after eating and are seated and serviced by waiters or waitresses (USCB, 2015). More than 243,100 full-service restaurants in America contributed more than $97,880,864 to the economy and employed 5,253,936 (USCB, 2015).
On the other hand, quick-service restaurants are small business establishments where patrons order their food from the counter and drive-thru before eating (USCB, 2015); they account for more than 275,000 restaurants in America and employ more than 5,000,000 people across the country (USCB, 2015). Nonetheless, the restaurant industry is a driving factor in the economy’s growth in the United States. As a result, the restaurant industry’s sustainability is crucial for Americans. But according to Parsa et al. (2015), the restaurant industry’s failure rates are the highest among the retail and service industries.
Healthy menu descriptions are significantly less appealing than unhealthy menu descriptions. Owners of quick-service restaurants have to provide an attractive explanation for low-calories items if they want to compete in today’s hyper-competitive market. As Americans become more health conscious, owners of quick-service restaurants have to offer appealing low-calorie items to mitigate the threat of shifting consumer preferences.
Quick-service restaurants accounted for more than 2014 restaurants in Arkansas and employed more than 46,122 Arkansans (USCB, 2015). Between 2015 and 2018, the USCB’s data showed an increase (35 new restaurants) in quick-service restaurants in Arkansas. But this data did not show the annual survival rate between years (USCB, 2015). In addition, the USCB’s data did not include the amount of news. To attain this information; I gathered public information on independent quick-service restaurants from the ADH. For this study, I concentrated only on independent quick-service restaurants in Arkansas restaurant establishments or the number of closures between years.
Independent quick-service restaurants in Arkansas. Arkansas independent quick-service restaurants are independently owned and not a part of a corporation, a chain, or a franchise. Self et al. (2015) wrote that 25% of independent quick-service restaurants fail within the first year of business, and 60% survive less than 3 years. Independent restaurants have a higher failure rate than franchise restaurants (Parsa et al., 2015). Franchise restaurant has a longer survival rate than independent restaurants (Self et al., 2015). Parsa et al. (2015) identified factors that cause independent restaurants to fail: 1) firm size, 2) finance, existing reputation, operation system, and leadership knowledge, education, and experience.
Contrary to support for franchise owners, the fate of quick-service restaurants depends on the owner’s decision-making ability to manage external and internal factors, differentiate themselves, and develop their employees. Yang et al. (2016) indicated that a firm’s competitive advantage comes from developing and acquiring tacit and explicit knowledge. Independent quick-service restaurant owners are not a part of a collective team of executives, so their decisions are independent and lead to poor choices. According to a 2013 to 2017 report from the ADH, more than 100 independent quick-service restaurants in Little Rock, Arkansas close annually or become inactive. The failure of independent quick-service restaurants leaves thousands of displaced workers without a job.
4. Research Method, Design, Population, Data Collection, and Data Analysis
4.1. Research Method
Researchers use qualitative research methods to explore events through human experiences (Ahmed & Ahmed, 2014; Birchall, 2014; Yilmaz, 2013). Second, researchers use qualitative research designs to understand the what and the why of lived experiences (Barnham, 2015; Cairney & Denny, 2015). Third, qualitative researchers seek to understand cultural experiences, narrative experiences, and contemporary experiences (Cronin, 2014; Yin, 2018). Finally, researchers use qualitative research designs to explore a phenomenon through grounded theory, narrative, ethnography, phenomenology, and case studies (MacGregor & Wathen, 2014; Yin, 2018).
4.2. Research Design
A case study research design includes single or multiple cases (Yin, 2018). I selected the qualitative, multiple case study design to capture a contemporary phenomenon (Colorafi & Evans, 2016; Yin, 2018). The basis of a case study focuses on immediate real-world events that cannot occur in a survey (Hancock & Algozzine, 2015). Researchers use the case study design because to gain a deeper understanding of participants’ experiences (Bernard, 2013). Using case study designs, researchers capture data using semistructured interview methods, gathering business artifacts such as training documents, or observing operational systems, including people (Yin, 2018). Case study researchers seek to understand a contemporary event in a real-world context (Yin, 2018). Using the case study design, researchers seek to understand a contemporary phenomenon using onsite, semistructured interviews or focus groups (Yin, 2018). I looked at a real-world, contemporary situation and captured information to explain a phenomenon using the case study research design.
I investigated the success factors of six independent quick-service restaurant owners by conducting semistructured interviews with each owner. I used member checking during and after the interview to increase the validity and accuracy of the research (Silverman, 2013). Researchers reach data saturation when the collected information does not duplicate (Yin, 2018). Data saturation occurs when data from participants become redundant (Fusch & Ness, 2015). Therefore, I probed the research participants until I reached data saturation.
4.3. Population
The population sample I used for this proposed study included owners of six independent quick-service restaurant owners in Little Rock, Arkansas, who had sustained in business beyond their first 5 years. The six owners and their establishments had to fit the following eligibility criteria: they met the U.S. Census definition of a quick-service restaurant, they operated consistently in business in the city of Little Rock, Arkansas, for more than 5 years, and they maintained independent ownership. I used 2013 to 2017 publicly available reports that I attained from the Department of Environmental Health Protection at the ADH to select potential candidates for my research study. ADH inspectors record the term active when business owners open new establishments or renew existing ones. The 2013 to 2017 report from the ADH inspectors removed bias in the data provided that every restaurant owner must renew their health permit annually to operate in businesses. If there is a change in ownership, the restaurant’s new owners must attain a new license. I used the ADH inspector report to guide my sampling method.
4.4. Sample
The research sampling method is as essential to the data collection process as collecting data (Fusch & Ness, 2015). Researchers must consider theoretical and practical underpinning when selecting a sampling method (Benoot et al., 2016). Researchers use the snowball sample to build their sample by asking research participants for recommendations for potential participants who could be a part of the research study (Robinson, 2014). Researchers have options when using the purposeful sample approach, such as choice of site, sampling strategy, and sampling size (Yin, 2018). Researchers can select participants who have experienced the phenomenon studied in a phenomenological study (Yin, 2018). Researchers use the purposeful sample because it provides a theoretical underpinning when the research aligns with the research proposition and the research design (Robinson, 2014). I chose purposeful sampling for my research because I had the option and flexibility in selecting participants, whether through a choice of site, a sampling strategy, and a sampling size. I also chose purposeful sampling because the method aligns with my research study and design. Purposeful sampling is the preferred method for qualitative research and supports the researcher’s ethical strategies (Marshall & Rossman, 2016). Yin (2018) posited that purposeful sampling is the best qualitative case study design method. Purposeful sampling seeks information-rich cases for in-depth studies (Yilmaz, 2013). Purposeful sampling as real-world examples and deliberate selections, not theoretical samplings (Gentles & Vilches, 2017). Purposeful sampling was a perfect fit for this study.
Researchers meet data saturation when data replication occurs, and the data collection method does not lead to new data, new themes, or new coding (Fusch & Ness, 2015). Data saturation is complicated for researchers who use qualitative research designs because they must consider both quality of data and the quantity of the data to ensure saturation (Fusch & Ness, 2015). The quality of the data is the richness and robustness of the collected research data that support the research protocol and line of inquiry; the quantity of the data is the amount of information collected by researchers during semistructured interviews, direct observations, or focus groups sessions. Yin (2018) wrote that 5 samples are sufficient for a multiple case study design to attain data saturation. Researchers must ensure data saturation, including a standardized line of research inquiry and asking unbiased probing questions (Yin, 2018). All research participants respond to standardized research questions, which moves the target and leads to data saturation (Fusch & Ness, 2015). Researchers reach data saturation when they have sufficient data quality and quantity for analysis. Data saturation occurs when data from participants become redundant (Silverman, 2013).
I began the sampling selection process by emailing a Letter of Inquiry to 10 potential candidates found in the 2013 to 2017 report from the Department of Environmental Health Protection. They fit the criteria of my study. I reviewed the responses from the potential candidates and selected only six of the 10 candidates to participate in my research study. I then emailed the six participants an Informed Consent form to sign, retain a copy for their records, and return the original document to me. I included in the Informed Consent language that explained the purpose of the research, the sample group, and the degree of involvement of the participants. I also included in the Informed Consent language that described the method for data collection, the potential risk to the participant, and how participating in the study was voluntary and confidential. The research participants were not obligated to answer any of the interview questions. According to the Belmont Report, participants will have the right to withdraw from interviews at any time (HHS, 1979).
Participants determined the time and location to ensure their comfort and safety. Before interviewing the research participants, I described the purpose of the study and informed the research participants of any risk to them before the interviews. I explained how I provided fair and equal treatment and how each research participant had the right to withdraw from interviews at any time without penalty. I informed the participants that the interview session was audio-recorded and that their identities would receive coding to ensure their anonymity and confidentiality. Each research participant had the right to withdraw from the study. I also informed the participant that all external electronic devices such as flash drives, hard copy interview notes, and business artifacts would be secured in a secure location for 5 years of the published research data and then destroyed.
4.5. Data Collection Instruments
Qualitative research is an exploratory process that researchers use to look at contemporary, real-life situations to attain an in-depth understanding of a phenomenon (Yin, 2018). In any qualitative study, the researcher has a direct role that is critical to the research outcome. The researcher acts as the instrument for data collection in the research phenomenon under study (Yin, 2018). I used my interview protocol to collect data during face-to-face interviews. I also collected data through business documentation and archival records to validate the collected data.
The semistructured interview was the most appropriate for my study to provide structure and flexibility. Researchers avoid irrelevant questions that are beyond the scope of the research. But they can create probing questions exclusive of limited responses that align with the central research questions and questions in the interview protocol (Yin, 2018). Therefore, I used the semistructured interview, including the case study protocol, to explore and capture elicit in-depth responses from my research participants. The case study protocol consisted of a brief description of the case study, interview questions, and data collection procedures (Yin, 2018).
I informed each research participant of any risk to them, how I would provide fair and equal treatment, and how each participant had the right to withdraw from interviews at any time before the commencement of the semistructured interview (HHS, 1979). During interview preliminaries, I informed the participants that I would audio-record the interview session and make their identities confidential. I also informed each participant that I used external electronic devices such as flash drives to capture interview data. I followed the interview protocol and probed for additional information when participants freely expressed themselves during the interview. For clarity, I asked participants to repeat the answer when responses were not clear. I also collected business documentation and archival record to validate the collected data. To validate the data collection, I conducted follow-up interviews with the participants using member checking methods to remove any errors in the interview summaries. Member checking in research increases the validity and accuracy of collected interview data (Silverman, 2013). Member checking consists of participants reviewing their interview summaries to identify and remove errors to increase the validity and the accuracy of the interview responses (Birt et al., 2016). To complete the transaction review, I performed data cleansing by having participants review summaries of their interview transcripts to ensure that no errors existed. Member checking and data cleansing increase the validity of the research (Silverman, 2013). Qualitative researchers ensure a sound review of data when they follow the interview protocol, clarify responses throughout the interview, and conduct member checking and data cleansing to augment reliability and validity (Wahyuni, 2012).
4.6. Data Collection Technique
I used the central research question to guide the questions in my interview protocol to ensure alignment. The most common data collection technique used in qualitative research is the interview (Onwuegbuzie & Byers, 2014). Researchers use semistructured interviews for case studies to provide researchers with information that is vital to the study (Singh & Gibbs, 2013). Researchers who use case study interview methods seek to gather in-depth details (Birt et al., 2016). The data collection techniques that I used in this study were the semistructured interviews and business documents.
Researchers triangulate multiple documents such as interview transcriptions, interview notes, and business artifacts to validate data collected in a research study (Wahyuni, 2012). Scholars and researchers who use the semistructured interview approach must ensure that they adhere to the Belmont ethical principles rule (HHS, 1979).
I scheduled six independent, 45-minute face-to-face interview sessions with six owners of quick-service restaurants in Little Rock, Arkansas, at a time and convenient location as determined by the participant. I informed the participants that I would audio-record the interview sessions and confidential the participants’ identities. I also informed each participant that all external electronic devices such as flash drives. I used two Olympus WS-852 digital recorder devices to ensure that I captured the audio interviews. I followed the interview protocol and probed for additional information during the interview sessions when participants freely expressed themselves.
To validate the data collection, I scheduled a 30-minute post-interview session with the participants to review summaries of their interview transcripts, where I used member checking methods to remove any errors in the interview summaries. Scholars use member checking in research to increase the validity and accuracy of the collected interview data (Silverman, 2013). The validity of a research study depends on the researcher’s ability to provide a valuable review of data (Wahyuni, 2012). Member checking consists of participants reviewing their interview summaries to identify and remove errors to increase the validity and the accuracy of the interview responses (Birt et al., 2016). Researchers also use follow-up interviews to achieve data saturation.
4.7. Data Organization Technique
I organized the data collected in my research using coding, audio recorders, and Computer-Assisted Qualitative Data Analysis (CAQDAS) software. Researchers use coding to manage data into patterns and emerging themes (Woods et al., 2016). Researchers code data in alphabet letters to shorten keywords and groups to organize themes (Singh & Gibbs, 2013). I coded the identities of the participants to ensure confidentiality. I addressed the participants by name and recorded their names on my research documents as Participant 1 (P1), Participant 2 (P2), Participant 3 (P3), Participant 4 (P4), and Participant 5 (P5), and Participant 6 (P6). I coded the documentation that I collected from participants with the label Document 1 (D1) through Document 4 (D4).
I used Temi online media to assist me in transcribing the interview data and Atlas.ti to assist me in identifying emerging themes and patterns in the interview data. Temi is an artificial intelligence online media that uses a speech algorithm formula to capture interview data and convert it to a complete transcript (Kenny, n.d.b). Artificial intelligence is comparable to human capabilities and allows common users to interact with intelligent technologies to produce quality outcomes (Oh et al., 2017). A researcher’s first reaction to artificial intelligence is fear and apprehension because of their lack of knowledge of the technology. Still, their thoughts change as they witness and experience the quality of the technology (Nelson et al., 2018). I uploaded the interview audio files to Temi, and Temi converted the files to the text within 5 minutes and displayed them in its web-based editor (Kenny, n.d.a). The web-based editor included the original audio files and the transcribed files for editing. I cleaned up any incorrect text in the transcripts, downloaded the transcribed Word files saved them on an encrypted flash drive. Atlas.ti is a software program that augments a researcher’s ability to code, theme effectively, and analyze large sums of qualitative, unstructured data (Lensges et al., 2016). For data collection, I interviewed the participants and collected business documentation. First, I conducted follow-up interviews with the participants to share interview summaries and interview transcripts to increase reliability and validity. Yin (2018) argued that transcription review increases the accuracy of interview data and increases validity. Second, I collected business documentation to use for triangulation. Lastly, I processed the unorganized interview data and business documentation data into Atlas.ti for organizing and data analysis to identify emerging themes and patterns. The process of data analysis, which considers coding identifies emerging themes and patterns in data (Woods et al., 2016). In a qualitative case study, researchers collect large sums of data for data analysis to answer the research question.
4.8. Data Analysis
In qualitative research, data analysis consists of examining sources of evidence by discovering, identifying themes, and organizing themes that help answer the central research question (Guo & Guo, 2016). Qualitative researchers examine and analyze sources of evidence to identify and discover new sources of information to inform the research (Morse, 2015). Data analysis includes analyzing and interpreting the collected data to develop themes to help answer the central research question (Yin, 2018). Yin (2018) stated that there are five steps in analyzing qualitative research data: 1) compiling, 2) disassembling, 3) reassembling and arraying, 4) interpreting, and 5) concluding. In this study, I examined sources of evidence from six interviews with owners of independent quick-service restaurants and multiple business documents to organize unstructured data, identify repeated information, and analyze themes that aligned with the conceptual framework of the research (Derobertmasure & Robertson, 2014).
Atlas.ti is the qualitative technology that I used in this study to assist me in analyzing large sums of data. Atlas.ti is a software program that augments a researcher’s ability to code, theme effectively and interpret large sums of qualitative, unstructured data (Lensges et al., 2016). Researchers use Atlas.ti to assist them in analyzing data through organizing, theming, and interpreting (Zamawe, 2015). The version of Atlas.ti that I used is Atlas.ti 8. I shared interview summaries with participants to evaluate them for errors to ensure data reliability. Member checking consists of participants reviewing their interview summaries to identify and remove errors to increase the validity and the accuracy of the interview responses (Birt et al., 2016). I also conducted a follow-up interview with each participant in my research to review the interview transcripts to ensure data reliability. Next, I processed the interview transcripts, notes, and business documentation into Atlas.ti. I used Atlas.ti to organize the data into groups for coding. The coding process identifies emerging themes and patterns in data (Woods et al., 2016). Researchers use coding to organize data into patterns and emerging themes (Woods et al., 2016). I coded the identities of the participants to ensure confidentiality. I addressed the participants by name and recorded their names on all research documents as Participant 1 (P1), Participant 2 (P2), Participant 3 (P3), Participant 4 (P4), and Participant 5 (P5), and Participant 6 (P6). Next, I coded the documentation that I collected from participants with the labels Document 1 (D1), (D2), (D3), (D4), and continued until I coded each document. After completing the coding, I conducted a thematic analysis of the coded, organized data to conclude the data. Researchers use thematic analysis to identify patterns across data in qualitative research, including words, phrases, or passages of text to interpret, describe, and draw conclusions (Braun & Clarke, 2016). Researchers organize data and then use thematic analysis to analyze the data in a more detailed account (Fugard & Potts, 2015). Researchers must ensure that the themes that evolve from their research align with their research question and the conceptual framework (Derobertmasure & Robertson, 2014). After I concluded the data, I used the triangulation method to analyze multiple sources of evidence provided by each participant to ensure the reliability of the data.
Triangulation is a method of analysis used to compare multiple sources of evidence to verify documentation and manage bias in research (Joslin & Müller, 2016). Fusch and Ness (2015) noted that triangulation is an in-depth process of analyzing data for exploring different perspectives. Yin (2018) reported that there are four types of triangulation: 1) data triangulation, 2) investigator triangulation, 3) theory triangulation, and 4) methodological triangulation. Qualitative researchers use methodological triangulation the most in case studies (Cope, 2014). Researchers use methodological triangulation to control mitigating bias during data analysis (Anney, 2014). Methodological triangulation helps to mitigate the participants’ self-serving attribution bias in this study. The type of triangulation method I used in this study was methodological triangulation. Methodological triangulation uses multiple sources of evidence to arrive at a comprehensive conclusion (Cope, 2014). The numerous sources of evidence that I used in this research involve information collected from interviews and business documentation.
4.9. Reliability and Validity
4.9.1. Reliability
Reliability is the process of ensuring the quality of data in a research study (Baškarada, 2014). Researchers seek to collect repeatable data and yield reliable results (Baškarada, 2014; Gheondea-Eladi, 2014). In qualitative research, researchers must establish a repeatable procedure to conduct their research and explain the process accurately. Researchers can follow the details and replicate the results (Yin, 2018). The researcher seeks reliability through the repeatability or dependability of instruments used in qualitative studies (Baškarada, 2014). Reliability is the concept of providing transparency during data collection, coding, and analysis of data in a qualitative to ensure readers may trace the results (Wamba et al., 2015). I interviewed the participants using the interview protocol (see Appendix). I asked the interview questions in the order of 1 through 6. I recorded each interview using two digital recording devices to ensure that I captured each interview and increased the data’s reliability and validity. I saved my interview notes, interview summaries, and interview transcript on external electronic flash drive devices. I shared the interview summaries with participants to examine for errors, and I conducted a follow-up interview session with the research participants to review their interview transcripts. Member checking consists of participants reviewing their interview summaries to identify and remove errors to increase the validity and the accuracy of the interview responses (Birt et al., 2016).
4.9.2. Dependability
Dependability is the process of procedural replication that yields the same results (De Massis & Kotlar, 2014). Dependability is the extent to which researchers evaluate the quality of the data instrument, the data collection, and the data analysis. In this study, I ensured dependability by structuring the interview process to perform the same way per participant. First, to protect the names of participants, I recorded their names on all my research documents as Participant 1 (P1), Participant 2 (P2), Participant 3 (P3), Participant 4 (P4), Participant 5 (P5), and Participant 6 (P6). I coded the documentation that I collected from participants with the label Document 1 (D1), (D2), (D3), (D4), and continued in this format. Second, I conducted the actual and follow-up interviews in a room where distractions were minimal. Participants provide effective feedback when they are in a comfortable and relaxing setting so that they can focus (Yin, 2018). Third, I shared interview summaries with participants to examine for errors, and I conducted a follow-up interview session to review the interview transcripts. Member checking and transcript review consist of participants reviewing their interview summaries to identify and remove errors to increase the validity and the accuracy of the interview responses (Birt et al., 2016). Transcript review and member checking improve the dependability of research data and ensure the trustworthiness of data results (Harvey, 2015).
4.9.3. Validity
Researchers seek to validate their research using a credible instrument and always check for data accuracy. The validity refers to the quality and accuracy of an instrument used in qualitative research to measure the outputs of a phenomenon under study (Singh & Gibbs, 2013). In qualitative research, validity combines the three elements of credibility, confirmability, and transferability. The elements assist in checking and verifying the accuracy of the data (Anney, 2014).
In this study, I interviewed six successful owners of independent quick-service restaurants to learn about strategies they used to sustain business beyond the first 5 years. I conducted semistructured interviews using an interview protocol for data collection and gathered business documentation for analysis. I analyzed the sources of evidence using Atlas.ti to organize the data into codes, theming the data to conclude, and review and compare the data to enhance its credibility through member checking and triangulation. Member checking consists of participants reviewing their interview summaries to identify and remove errors to increase the validity and the accuracy of the interview responses (Birt et al., 2016). Triangulation is a method of analysis used to compare multiple sources of evidence to verify documentation and manage bias in research (Joslin & Müller, 2016).
4.9.4. Credibility
Credibility is confirmation by the study participants to determine that the collected data in research is credible (Yilmaz, 2013). Researchers use credibility as the process of ensuring that collected data is accurate according to participants (Birt et al., 2016). I confirmed the credibility of data through a process of member checking. Member checking is used in research to increase the validity and accuracy of collected interview data (Birt et al., 2016). After the initial interview with the participants, I met with each participant. I allowed them to review the summaries of the interview transcripts. I also used methodological triangulation to increase the validity and reliability of the research. Methodological triangulation uses multiple sources of evidence to arrive at a comprehensive conclusion (Cope, 2014). Triangulation is a method of analysis used to compare various sources of evidence to verify documentation and manage bias in research (Joslin & Müller, 2016).
4.9.5. Transferability
Transferability means that the results of a research study can be generalized by other researchers and is transferable to different research contexts (Yilmaz, 2013). Researchers can enhance transferability by clarifying every step of the research, such as a type of interview guide, including the interview protocol, discussing the geographical location of the study, and the type of sample. Researchers use transferability to provide clean and precise pathways of information that align with a process from data collection to analyzing the research (Black et al., 2013). Transferability of the findings creates a logical approach to research so that other researchers understand the context of the study (Yilmaz, 2013). Qualitative research use descriptions as mile markers throughout their study to enable transferability (Anney, 2014). I used clarifying steps and descriptions of research throughout this study to ensure that researchers could analyze the contexts of my research for transferability.
4.9.6. Confirmability
Researchers confirm information through multiple strategies and including probing questions and triangulation. Confirmability refers to the objectivity and interpretation of research data (Yilmaz, 2013). In a qualitative case study, the interview is critical to conformability. The researcher must ask probing questions throughout the interview to ensure that he and the participant interpret the collected data. The process can occur by repeating the same question, asking for clarity of a response, or paraphrasing the participants’ words to ensure that the researcher interpreted them correctly (Yilmaz, 2013). Researchers maintain confirmability by consistently discussing and verifying findings in the research (Yin, 2018). Confirmability is a concept of verifying information through referencing field notes, probing and repeating questions, and member checking (Zitomer & Goodwin, 2014). In addition, researchers ensure confirmability through the data cleansing process, member checking, and aligning quotes with emerging themes (Cope, 2014). I provided objectivity and interpretation of the research data approach by maintaining an auditing trail to confirm the methods and strategies used in my research.
5. Summary of the Findings
The central research question for this qualitative multiple case study was: What strategies do independent quick-service restaurant owners use to sustain business beyond the first 5 years? The participants came from diverse demographic backgrounds and had heterogeneous internal resources and unique business experiences that guided their socially complex business strategies. Consequently, the participants’ demographics and business attributes influenced their interview questions.
There was a broad overview of the participants’ demographics and business attributes. These categories were critical to this study because they shaped the interview responses and findings of the study. The participants’ demographics consist of the following 4 categories: 1) education/business background, 2) gender, 3) ethnicity, and 4) generation. Three out of the six participants achieved college degrees; four out of six participants were male and two females; three out of the six participants were Caucasian, two were African American, and one was Middle Eastern; and three out of 6 participants were Baby Boomers, one Generation X, and two were Millennials. Baby Boomers (born from 1944 to 1964) include committed workers who grew up during industrial-economic prosperity; they are not reliant on technology (Heyns & Kerr, 2018). Generation X (born from 1965 to 1980) is a much smaller generation than the Baby Boomers. They experienced a poor economy, high crimes, and absentee parents and believed in work-life balance and spending time with their children (Woods, 2019). Finally, millennials (born from 1981 to 1995) are the largest generation raised during the digital age (Heyns & Kerr, 2018). They are the essence of the information age, and they rely on technology (Woods, 2019).
Business attributes consist of the following categories: 1) years in business, 2) employee retention, 3) private brand offerings, 4) catering, 5) wholesale offerings, 6) location, and 7) number of locations. Barney (1991) posited that a firm’s attributes could enable a firm to implement value-creating strategies. The business survival rates ranged from 5 years to 35 years. Three out of the six participants’ employee retention rates sustained longer than 10 years and two less than 6 years. All participants had private band offerings. In addition, five out of six participants provided catering offerings; three out of the six offered wholesale offerings to local or regional businesses; four out of six participants owned businesses located in urban areas and two in suburban areas, and two out of six participants had multiple locations.
The conceptual framework I used in this study was the RBT. Mathooko and Ogutu (2015) argued that leaders of firms could sustain a competitive advantage through leveraging their internal resources. Barney (1991) posited that the RBT only includes the firm’s internal resources. I developed the research questions for this study in support of the RBT to inform how owners of successful independent quick-service restaurants use their inner resources to create sustained competitive advantage.
To analyze the recorded audio data, I completed three phases of data analysis. First, I uploaded the six recorded audio files to Temi, the artificial intelligence technology, to convert the recorded audio files into complete transcripts. Temi converted recorded audio files into complete transcripts in less than 30 minutes.
While in Temi’s web-based editor, I made minor edits to the six transcripts and removed any errors. It took me 4 hours to complete the minor modifications to the transcripts. Next, I downloaded the six transcripts onto my lap computer. Next, I uploaded the transcripts to atlas.ti. Next, I began reviewing and sorting the transcripts for coding and the information I identified in the collected notes and business artifacts. Lastly, I conducted two cycles of analysis: initial analysis, including theming the data in which I aligned the emergent themes to my conceptual framework. I also aligned the emergent subthemes to emergent themes. The results of the initial analysis comprised of the following six emergent themes: 1) organization value, 2) customer required excellence, 3) financial perspective, 4) human assets, 5) physical operating materials, and 6) technological prowess. The results of the second analysis comprised the alignment of the six emergent themes with the five types of internal resources of a firm: 1) organizational capital, 2) financial capital, 3) human capital, 4) physical capital, and 5) technological capital. Greene et al. (2015) explained that internal resources of a firm include 1) physical resources, 2) financial resources 3) technological resources, 4) human resources, and 5) organizational resources.
The five types of internal resources owned by a firm have the potential for generating a sustained competitive advantage when they can improve the efficiencies and effectiveness of a firm’s outcomes while mitigating threats (Barney, 1991). The five types of internal resources can also be sources of sustained competitive advantage when immobile, heterogeneous, and coordinated to increase value for customers and the business. In contrast, a firm’s internal resources cannot affect a firm’s value or strategy and negatively contribute to a firm (Barney, 1991). The internal resources can be ineffective resources that negatively affect profitability and damage a firm’s reputation.
The six emergent themes perfectly align with my conceptual framework’s five types of internal resources. Yet, some elements of the emergent themes contradict parts of the research in the Academic Review of Literature subsection. For example, Porter (2008) stated that technology is a significant part of a firm’s value chain and a source of competitive advantage. Yet, only a few of the participants in the study truly embraced technology as an internal resource that could be a source of competitive advantage. The six emergent themes also answered the central research question proposed in this study. The six themes emerged from 12 subthemes; 32 codes occurred in the participants’ transcripts.
5.1. Applications to Professional Practice
The findings of this qualitative multiple case study could help owners and future owners of independent quick-service restaurants in Little Rock, Arkansas, and across the country engage their internal resources to sustain in business for more extended periods. The findings of the study could contribute significantly to professional business practice by 1) providing a guide for operating an independent quick-service restaurant with limited resources, 2), determining whether internal resources are heterogeneous and immobile, 3) evaluating internal resources to determine their competitive advantage, and 4) leverage internal resources to achieve optimal outcomes. In the subsection, I used the RBT’s VRIN evaluation instrument and the Independent Quick-Service Restaurant Integrated Social Complexity and Casual Ambiguity Model to explainhow the findings in the study can apply to professional practice.
5.2. Resource-Based Theory’s Value, Rare, Imitable, and Nonsubstitutable Evaluation Instrument Example
The RBT’s VRIN evaluation instrument consists of eight categories. I presented an organized explanation of the evaluation of each internal resource. First, I summarized how participants in the study used their internal resources. Next, I evaluated their internal resources according to their business context and business strategy. Lastly, I explained whether their internal resources are sources of sustained competitive advantage. If the resources are not sustainable, I explained how to enhance the value of their resources.
Intellectual properties. All the participants in the study had intellectual properties that were both heterogeneous and, in some degree, immobile. The participants had secret sauces created by the owner of the establishment or created by the employees. The secret sauces that were owner-centric were heterogeneous and imperfectly immobile. The owner was a permanent fixture in his or her establishment without any intent to sell the business. The secret sauces that the employees created were heterogeneous and, in some degree, immobile. The employees who created secret sauces had collectively worked for the restaurants for more than 20 years. They were paid 30 percent beyond the market salary and had contractual agreements with the owner for the rights of their intellectual properties. The contractual agreements were not discussed in this study. As a result, I could not fully evaluate whether the employees who created secret sauces were mobile or immobile. The secret sauces had social complexity, historical conditioning, and casual ambiguity that could not be fully understood or duplicated. Regarding the VRIN instrument, the secret sauces were valuable, rare, difficult to imitate, and nonsubstitutable; as a result, they were sources of sustained competition (SCA). The secret sauces could enhance value for the firms while mitigating threats.
Talent and development. All the participants recruited, trained, and developed employees who they hired. All the participants had strategically aligned employees and helped them advance their informal strategies. But not all the employees were immobile. For example, participant 5 only recruited and hired employees to assist him in delivering orders to customers in his diner. He refused to teach them the recipes to the secret sauces or even run the daily operations. They were only extensions of his arm, meaning he used them when he needed them. Their work schedules were inconsistent, and their tenure was less than 6 months. He only employed one worker at a time. He was a one-person operation. As a result, the employees were perfectly mobile and not sources of sustained competitive advantage (NSCA). As a result, they did not create value for customers. Regarding the VRIN instrument, participant 5’s employees were not valuable or rare. Independently, they did not provide social complexity or casual ambiguity for the firm. Participant 5 could train and educate his employees on all the operational processes and procedures to enhance their value. He also could teach them how to use the merchant credit card transactional device or give them key access to the restaurant. He could also use them to order and manage supplies or provide feedback to online customers through crowd-sourced review platforms such as Yelp. If he had a website and social media account, he could manage his accounts to attract customers to the restaurant.
Technological prowess. None of the participants could effectively sustain competitive advantage through technical knowledge. The participants’ technological capacity operated at a novice level with no experience. Some of them had basic ability to navigate social media platforms. But they could not exploit them. Their lack of experience did not garner a sophisticated level of social complexity or casual ambiguity that competitors could not duplicate.
Regarding the VRIN instrument, the resources offered no sustaining competitive advantage (NSCA). To increase the value of resources, the owner had to build their knowledge of technology and bundle it with other internal resources to increase value for customers. Bundled internal resources such as physical, human capital, and technology capital is the source of a firm’s sustained competitive advantage (Blome et al., 2014; Mathooko & Ogutu, 2015; Wernerfelt, 1984).
5.3. Independent Quick-Service Restaurant Integrated Social Complexity and Casual Ambiguity Model
The Independent Quick-Service Restaurant Integrated Social Complexity and Casual Ambiguity Model (ISC model) is a cause-and-effect instrument that enhances value for customers while creating a sustained competitive advantage for the firm. The model includes 6 categories from my study. According to the RBT, informal strategies can create social complexity and casual ambiguity that are rare and difficult to imitate (Barney, 1991). In my study, owners of independent quick-service restaurants operated with perfectly imitable, limited resources; as a result, most of their internal resources were highly mobile. The perfectly imitable and mobile resources used independently and in isolation were not likely sources of sustained competitive advantage. The ISC model integrates, and bundles internal resources owned by the firm to create a level of social complexity and casual ambiguity to be a source of sustained competitive advantage. Bundled internal resources such as physical, human capital, and technology capital is the source of a firm’s sustained competitive advantage (Blome et al., 2014; Mathooko & Ogutu, 2015; Wernerfelt, 1984). The ISC model has three operating components: the crust layer, the slab layer, and integrated social complexity.
Competitive advantage through technological knowledge. The participants’ technical capacity operated at a novice level with no experience. Some of them had the essential ability to navigate social media platforms. But they could not exploit them. Their lack of experience did not garner a sophisticated level of social complexity or casual ambiguity that competitors could not duplicate.
Regarding the VRIN instrument, the resources offered no sustaining competitive advantage (NSCA). To increase the value of resources, the owner had to build their knowledge of technology and bundle it with other internal resources to increase value for customers. Bundled internal resources such as physical, human capital, and technology capital is the source of a firm’s sustained competitive advantage (Blome et al., 2014; Mathooko & Ogutu, 2015; Wernerfelt, 1984).
Crust layer. The crust is the bottom layer of the ISC model. It includes the components: 1) financial perspective, 2) physical operating capital, and 3) organization value. Owners of independent quick-service restaurants must fully understand the components and elements of the model and know how to take advantage of them. The financial perspective has two elements: funding sources and diversified resources. Funding sources are personal savings and financial institutions. Owners of independent quick-service restaurants must initially have personal savings and organize friends, family, and local investors to assist them. If possible, they must also have access to financial institutions. To get a business loan, they must meet the following qualifications: 1) have a qualifying credit score of at least 700, 2) have a strong business plan, and 3) provide collateral (e.g., house and vehicle). They must also diversify their portfolio offering. They must develop offerings beyond their retail offerings that create multiple revenue streams (e.g., catering, wholesale, and private brands). Physical operating material has two elements: physical material and raw material. The actual property and operating machinery and furniture are considered physical materials.
Independent quick-service restaurants must be strategically located and thematically appealing. The products must begin from a raw state, and the recipes must be originally homemade. Customers are attracted to original flavors. Organization value has two elements: business acumen and intellectual properties. Owners of independent quick-service restaurants must consistently use transferrable knowledge, iterative learning, and application of knowledge. They must apply the knowledge acquired from former careers or education, including their experiences, to deduce strategic information from limited resources to coordinated systems, create innovation, and create efficiencies in processes. Lastly, they must research, study, and create intellectual properties such as secret sauces. They must also retain good employees and build their tacit knowledge.
Slab layer. The slab is the foundational layer of the ISC model. It includes the components 1) human assets, 2) customer-required excellence, and 3) technological prowess. Owners of independent quick-service restaurants must fully understand the components and elements of the model and know how to take advantage of them. Human assets have two elements: owner-leadership and owner relationship with the employee. Owners of independent quick-service restaurants must be owner-leaders. They must be fully engaged in their day-to-day operation and be a role model for their employees, meaning they must function in every role when needed. They must create independent and dynamic relationships with each employee. They must be approachable, open, and transparent. They also must recruit the right talent to support their informal strategies and operational processes, procedures, and systems. They must consistently train and develop their employees and meet strategic obligations; they must also pay their employees living wages. Customer-required excellence has three elements: types of customers, customer relationships, and culture. Owners of independent quick-service restaurants must effectively manage the three types of customers: acquisition, retention, and noncustomers. They must have unique strategies to acquire new customers, retain existing customers, and convert noncustomers. They must build dynamic relations with offline and online customers. They must know the names of customers who enter their diner or recognize them upon entering. They must understand consumerism and engage in crowd-sourced customer review platforms such as Yelp. Technological prowess has one element: business technology. Business technology includes point-of-sale systems, website presence, and social media leveraging. Owners of independent quick-service restaurants must effectively utilize business technology to sustain business in the information age. They must train and develop their employees on the functionality of business technology and delegate responsibilities accordingly. They must have a business website that interfaces with a database to capture customer online site visits, transactions, and purchases. They must also have social media accounts and often engage in social media marketing and interacting with customers.
Integrated social complexity and casual ambiguity. Integrated social complexities and casual ambiguities are the connectivity that links together the components and elements of the ISC model. Integrated social complexities and casual ambiguities are the lines that connect the themes (squares) in the model. Socially complexed resources of a firm are the interpersonally influenced resources; casual ambiguous resources of a firm are imperfectly understood (Barney, 1991). The links are influenced by the owner-leader’s cognitive ability to systematically bundle together internal resources to create positive synergy among the internal resources owned by the firm. Owners must bundle together internal resources through a trial-and-error process to test their capacities. Each owner must figure out what linkages work for their business context and strategy. The owner must learn through iterative learning by testing and applying the knowledge learned to find the perfect prescription for their business context. For example, there is no ideal linkage for all owners of independent quick-service restaurants. The owner must protect the detailed knowledge of the perfect linkages from the general employee body. Employees of the firm must poorly understand the perfect linkages to generate a sustained competitive advantage. Employees who can easily describe the perfect linkages of a firm’s internal resources used to generate a sustained competitive advantage can potentially be recruited by a competing firm. The competing firm can reduce the original firm’s ability to sustain a competitive advantage. The perfect prescription of linkages creates social complexity and casual ambiguity that competing firms cannot understand and compete away.
Cause and effect. The central premise of the ISC model is to use it to create layers of integrated social complexities and cause and effect synergies. First, the components and elements of the crust layer must be researched, studied, learned, and applied. For example, owners of independent quick-service restaurants must build and manage their credit scores, pitch business plans to financial institutions, and diversify their financial portfolios. They must also develop their intellectual properties and business knowledge. Lastly, they must create a business environment conducive to their business context and strategy.
Secondly, the components and elements of the slab layer must be researched, studied, learned, and applied. Owners of independent quick-service restaurants must operate as an owner-leader, recruit and hire employees who support their business context and strategy, and identify the targeted customer audience to market, acquire, retain, and upsell. They must also understand how to build offline and online relationships with customers. Owners must manage and engage in their website and social media platforms to develop online relationships with customers. Lastly, the owner must create a heterogeneous and imperfectly immobile culture. Cause and effect are created by perfectly aligning and integrating components and elements of the crust layer with the slab layer, which theoretically makes a source of competitive advantage.
The study’s findings contributed to the body of knowledge that expands the volume of extant literature. Owners of quick-service restaurants created a sustained completive advantage using limited resources. The study’s identified emergent themes and subthemes provided a detailed analysis of the internal resources and specific strategies they used to sustain the business for long periods. The RBT evaluation instrument can be used by owners of quick-service restaurants to determine the value of their internal resources. In addition, the ISC model can be used as a guide to assist quick-service restaurants owners in creating business strategies to advance their business practices.
5.4. Implications for Social Change
Independent quick-service restaurants are global, national, and local economic drivers that is vast and dynamic (IBIS World, 2018). The restaurant food service and drinking industry is the largest industry in leisure and hospitality in America, adding 1.3 million jobs to the economy between 2010 to 2014 (BLS, 2014). Although franchises dominate the quick-service restaurant industry, the industry is highly competitive and accounts for more than 275,000 restaurants in America and employs more than 5,000,000 people across the country (IBIS World, 2018).
The results of this study may help improve the chances of survival for owners of independent quick-service restaurants in Little Rock, Arkansas, and across the United States by providing them with successful strategies to evaluate and leverage their internal resources to determine their competitive advantage and to sustain in business beyond the first 5 years. Social change is the concept of intentionally committing to finding ways to transform societal well-being inside and outside the boundaries of an organization (Stephan et al., 2016). In addition, social change also means contributing to society in ways that positively alter the conditions of society (Stephan et al., 2016).
The findings of this study identified multiple ways for owners of independent quick-service restaurants to contribute to social change in local communities by 1) enhancing the value of internal resources to create business growth in local communities, 2) increasing job stability by sustaining for more extended periods, 3) reducing the unemployment rate in local communities. By adopting the recommendations for further action, owners of independent quick-service restaurants can avoid the pitfalls of failure by using the recommendations as a guide to create superior value for customers, strategies for sustainability, and strategies to mitigate risk from local competition
5.5. Recommendations for Action
The findings of this study may contribute to the growth and sustainability of independent quick-service restaurants across the United States. The results of this study are valuable for existing owners of independent quick-service restaurants and valuable for anyone who considers investing or venturing into the industry. Using the strategies identified in this study may 1) minimize the challenges of day-to-day business operations and sustainability for novice and some existing owners of independent quick-service restaurants; 2) enhance owners’ ability to evaluate their internal resources, and 3) increase owners’ capacity to integrate limited, internal resources of a firm to create socially complexed integrated resources.
The findings of this research should not only be privy or limited to owners of independent quick-service restaurants to use as a guide for business growth sustainability, but they should also be shared with other outlets such as academic journals, business literature, consulting firms, the Association of Strategic Planning, the Harvard Business School and others like ones, the Harvard Business Review, prominent scholars of theories such as Porter’s Five Forces, Blue Oceans Strategies, and Platform Strategies, the Small Business Association, and National Center for Health Statistics, local environmental health protection agencies, IBIS World, and First Research. The findings of this study provided new strategies for owners of independent quick-service restaurants, investors, educators, and all interesting parties a blueprint for leveraging their limited internal resources to create sustained competitive advantage.
5.6. Recommendations for Further Research
The findings of this study contributed to new knowledge to the current body of literature regarding how owners of independent quick-service restaurants can leverage their limited internal resources to sustain in business beyond their first 5 years. The qualitative method and design that I used in this research study inherited limitations because of their structure. The qualitative research method is designed to seek to understand cultural experiences, narrative experiences, and contemporary human experiences (Cronin, 2014; Yin, 2018); Hancock and Algozzine (2015) posited that the case study design has limitations because it is based on immediate real-world events that cannot be captured in a survey unlike that of a quantitative or mixed method design. As a result, the chosen method and design used in this study created limitations and opportunities for further research.
The primary limitation of this study was the size of the population. The population size of the study consisted of 6 owners of independent quick-service restaurants. Unfortunately, such a small population size prevents the generalizability of the findings to a larger population. Therefore, researchers should consider furthering this research using a larger population.
The second limitation of this study was the lack of ethnic qualifications regarding participants. The criteria for the study did not include a specific ethnicity group for consideration such as Mexicans, Africans, African Americans, Jews, Arabs, and Chinese quick-service restaurant owners. Researchers should consider furthering this research by focusing on a specific ethnicity.
The third limitation of this study was the geographical location of Little Rock, Arkansas. The research could have included owners of independent quick-service restaurants in bordering states like Tennessee, Mississippi, Oklahoma, or Texas. A study of a broader geographical scope could reveal a broader range of successful strategies for leveraging limited internal resources to sustain in businesses beyond the first 5 years. Additionally, the scope of this research study created a limitation since it only identified with the independent quick-service restaurant industry. This research could have included owners of small businesses in other sectors such as manufacturing, technology, farming, and clothing. Incorporating other sectors could have revealed other valuable findings regarding the utilization and diversity of internal resources.
The fourth limitation of this study was the lack of gender consideration. A report from the SBA revealed that minority women business owners lack the necessary financial support to sustain in businesses as their counterparts (SBA, 2016). Since the study did not consider gender, researchers should expand this study by focusing on a specific gender population.
The fifth limitation of this study was the lack of focus on specific dietary factors. The threat to owners of independent quick-service restaurants is shifting the preferences of consumers (First Research, 2018). Consumers are more health-conscious and aware of health issues related to obesity, hypertension, and high cholesterol (IBIS World, 2018). Some consumers prefer menus with healthy, low-calorie items to those with high-calorie items. Researchers should expand this study by focusing on shifting consumer preferences. Finally, researchers should employ a different qualitative research design, such as ethnography or phenomenology design, or a quantitative research design, such as experimental, to explore or examine further strategies for leveraging and diversity internal resources to create sustained competitive advantage.
6. Conclusion
Owners of independent quick-service restaurants confront challenges with limited resources every day in business. The finding of this study revealed that successful owners of independent quick-service restaurants knew how to respond to challenges; they knew how to leverage their limited internal resources using informal strategies to create sustained competitive advantage. Some leaders of firms outperform other leaders by leveraging their internal resources to create sustained competitive advantage (Barney, 1991; Campbell & Park, 2017; Wernerfelt, 1984). In addition, the owners know how to make value for their customers. The strategies identified in the findings provided solutions that owners of independent quick-service restaurants can use to grow and sustain a business.
NOTES
*Dr. Mario D. Wallace, DBA, M.Ed., BSC, LSSBB, and CCMP.
Dr. Wallace has a bachelor degree in International Language and Rhetoric and Writing, a master degree in Learning Technology, and a doctorate degree in Business Administration Leadership.
Dr. Mario D. Wallace is currently the Principal Strategy Consultant at the Ohio State University in Columbus, Ohio.