PERSPECTIVES ON ISLAMIC TOURISM AND SHARIAH COMPLIANCE IN THE HOTEL MANAGEMENT IN MALAYSIA

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1 Paper Proceeding Islamic Economics and Business Vol I, No.1, July 2013: 1-8 PERSPECTIVES ON ISLAMIC TOURISM AND SHARIAH COMPLIANCE IN THE HOTEL MANAGEMENT IN MALAYSIA 1 Che Musa Che Omar, 2 Mohammad Serazul Islam 3 Noormuthaah Mohamad Ali Adaha chemusa@bis.unikl.edu.my,seraz_iium@yahoo.com,ruhiyah88@gmail.com UniKL Business School, Universiti Kuala Lumpur Presented on June 28, 2013 Abstract: Tourism is one of the main generating factors to Malaysian economic growth which has contributed about RM60.6 billion in tourists receipts from million arrivals in 2012 (Tourism Malaysia, 2013). About 55% of the arrivals were Islamic tourists mostly from Islamic countries. The purpose of this research is to describe the phenomenon and to explore factors that influenced and interrelated between Islamic tourism and shariah compliance in tourism products. Content analysis was used systematically to analyse and examining the existing data and the research outcomes will demonstrate the evidence of economic impact that resulted from Islamic tourist arrivals to Malaysia. SWOT Analysis was used to evaluate the situation of Islamic tourism in Malaysia in compliant to Shariah. This paper is an exploratory research on the perspectives of Islamic tourism and Shariah compliances in hotel management in Malaysia. Shariah compliant hotels within the Islamic tourism perspectives will make the implementation on the compliant easier as Malaysia is an Islamic country that will accommodate tourists to visit Malaysia ample of Islamic products towards a better understanding about Islamic tourism as destinations for tourist to this country. Keyword: Islamic Tourism, Shariah Compliant, Hotel Management, Content Analysis, exploratory research, SWOT Analysis. 1. INTRODUCTION Tourism is one of the contributors for Malaysian economic growth. In 2012, It has contributed about RM60.6 billion in tourists receipts with million arrivals (Tourism Malaysia, 2013) and among these are selected Islamic tourists coming from various Islamic countries as shown in Table 1 below. -1-

2 Omar, et al,. PERSPECTIVES ON ISLAMIC TOURISM AND SHARIAH COMPLIANCE IN THE HOTEL MANAGEMENT IN MALAYSIA Table 1. Distribution of Tourist Arrivals from Selected Islamic Countries to Malaysia Accordingly, there are 2,724 hotels in Malaysia with a total number of 195,445 rooms of which less than 10% are categorized at Islamic hotel provision despite of no Shariah compliant certification. With the influx of Middle-Eastern country tourist demand for Islamic tourist products is on the high that need to be accommodated for economic growth. 2. Islamic Tourism in Malaysia Perspective In 2000 Organization of Islamic Conference (OIC) meeting has introduced and gave more emphasis on the growth of Islamic tourism. Through Islamic tourism Muslim countries can be developed economically where OIC (2000) identified the spot of to selected Islamic countries in order to boost its income levels. The Malaysian Government is taking this opportunity to enhance the economic growth through promoting tourist arrivals from Islamic countries which accounted about 70% of its tourist arrival in This is due to its uniqueness in producing variety of tourism products will affect the tourism industry, includes such feature as flexible, rational, simple and balanced (Siti Anis Laderlah, et.al, 2011) coupled with a multicultures, multi-religions and fascinating destinations that are not to be experienced in other countries Muslim countries. In 2009, Malaysian government has approved the scheme to establish a company called Islamic Tourism Centre (ITC) taking necessary accountabilities and actions to expedite the Ministry of Tourism and tourism industry in Malaysia efficaciously. Hashim, Murphy, & Hashim, (2007) states, Emphasizing on the notion of Islamic trip more attention has been given on the online advertisements of tourism by the authorities of tourism. They started to comprise Islamic features on their website such as prayer time, the concatenation of Halal food providers and Islamic travel guidelines. The slogan of develop with Islam has been introduced in the State of Kelantan, Malaysia by implementing the rules and regulations of Islam (Suhana & Marsitah, 2009). Therefore, Malaysian government always invites all tourists regardless of religious and colour to visit Malaysia for enjoying their leisure period in an Islamic tourism environment as Qur an emphasised that travel to all countries to observe the beautiful phenomenon of this world which has been created by Allah AlMighty.. -2-

3 EISSN ISSN Figure 1 A model of Islamic features that affect tourist satisfaction Researchers believe that pulling and pushing factors are giving major affect to the selection of tourism destination (Jang and Caj, 2002; Yoon and Uysal, 2005). The pulling factor is emotional or internal feelings of the tourists while pushing factor is features of destination to travel (Laguna and Palacios, 2010). Battour (2010) defined pulling and pushing factors in tourism behavior perspectives as demand and supply factor. The above figure shows Islamic features is important aspect that affect tourist satisfaction towards Islamic tourism products. This relate to the high-quality services tourists received from the Islamic tourism products which would increase the number of customer loyalty into it (Zabkar et.al, 2010), that includes hotel management operation. Therefore, Allah says, Have you not travelled through the earth and seen what was the end of those before them? They were more in number than them and mightier in strength, and in the traces (they have left behind them) in the land; yet all that they used to earn availed them not (Surah Ghafir, 82). According to the Holy Qur an there are thirteen (13) verses that encouraged people to travel or ziarah places of attractions as stipulated in (Al-Imran:137; Al- An am:11; Yusof:109; Al-Nahal:36; Al-Hajj:46; An-Naml:69; Al-Ankabut:20; Ar- Rum:9,42; Fatir:44; Ghafir:21,82; Muhammad:10). Through these Qur anic verses Allah (swt) calls us to travel different countries of this globe to visit the historical places with having intense intention to know the consequent of previous generations; as they used to lead their worldly lives avoiding and neglecting the laws of Divine such as all the Taghut elements or features. Osman Bakar (2011), reiterated that Islamic tourism package should avoid elements pertaining Taghut, As Allah declares And verily, We have sent among every Ummah (community, nation) a Messenger (proclaiming): Worship Allah (Alone), and (or keep away from) Taghut (all false deities i.e. do not worship Taghut besides Allah). Then of them were some whom Allah guided and of them were some upon whom the straying was justified. So travel through the land and see what was the end of those who denied (the truth) (Surah An-Nahl verse-36). Travelling need accommodations and places for tourists to stay which Peter Jones and Andrew Lockwood (2002) defined hotel as providing accommodation and services to the guests. Hotel can be categorized into four types such as hotel by size, by star system, by location and by ownership. Shariah Compliant hotel represents 10% of the world tourism market and Al-Mulla Hospitality in Dubai is one of the hotel chain -3-

4 Omar, et al,. PERSPECTIVES ON ISLAMIC TOURISM AND SHARIAH COMPLIANCE IN THE HOTEL MANAGEMENT IN MALAYSIA that are going to open about 150 halal hotels by 2015 (Gulf Daily News, 2012). Unfortunately, in Malaysia it is yet to develop hotels compliant to Shariah Principles. Table 2 shows list of hotel moving forwards becoming Islamic and Shariah Compliance hotel in Malaysia. 3. Understanding Shariah Compliance The term Shariah in Arabic means the path to be followed by human being (Doi A.R.I, 1984). Shariah is revelation from Allah as rules or way of life to mankind through Prophet Muhammad (Mahmood Zuhdi Abdul Majid & Paizah Ismail, 2004). The word Shariah is stated in the Qur`an Surah AL-Jathiyah verse 18: Then We have put you (O Muhammad s.a.w.) on a plain was شريعة of (our) commandment. So follow you that (Islamic Monotheism and its laws), and follow not the desires of those who know not. (Al-Jathiah:18) (Mohamad Akram Laldin, 2011) In the discipline of study it is defined as a comprehensive guidance from Allah in all aspects of human life (ibid). Allah said in Holy Qur an Surah An-Nur: Allah guides to His Light whom He wills. (24:35, Muhammad Taqi-ud-Din Al-Hilali & Muhammad Muhsin Khan translation). Abdul Karim Zaidan and many contemporary scholars defined Shariah as Islamic Taught and system in the Qur`an that revealed to Prophet Muhammad (S.A.W.) as guided lifestyle called the sunnah (Mohamad Akram Laldin, 2011). While Compliance means adherence and obedience to all Allah S.W.T. ordered. Furthermore, the main objective of Shariah is to straighten truth and justice in the world. The principles of Shariah are tolerance, release from burdens and occur gradually (Mahmood Zuhdi Abdul Majid & Paizah Ismail, 2004). 4. HOTEL INDUSTRY A hotel is an establishment that provides services such as accommodation, food and drinks for guest or temporary residents who intend to stay at the hotel (Medlik and Ingram, 2000). As stated by Jones and Lockwood (1989) the hotel sector is commonly known as lodging sector because hotels provide overnight accommodation to the guests. In Malaysia, there are about 2,724 hotels of various categories supplying about 195,445 rooms of different types as shown in Table 2 below. -4-

5 EISSN ISSN Furthermore, the hotels are also defined as an operation that provides accommodation and ancillary services to the people that are away from home. Hotels also contribute to the economy of the country. This is because when the guests stay at the hotels they will spend on the hotel services and buys products from the local shops thus contributing to the local economy. In Malaysia, the hotel sector has continued to grow since 1994 (Yuhanis, 2007). Continuous growth of tourism industry in Malaysia has increased the number of hotels in Malaysia. The number of new hotels being opened has grown due to increase tourist arrivals and increase demand for accommodation services while they are travelling or attending certain event. For instance, the demand for hotel rooms increased significantly for Visit Malaysia Year 1990 Campaign and also Commonwealth Games in 1998 (Ching, 2008). The chart below shows the proposed model of Shariah Compliant hotel -5-

6 Omar, et al,. PERSPECTIVES ON ISLAMIC TOURISM AND SHARIAH COMPLIANCE IN THE HOTEL MANAGEMENT IN MALAYSIA The table shows total number of hotels in Malaysia is 2707 hotels with 193,340 rooms (Tourism Malaysia, 2013). Hence, about RM58.30 billion in tourist receipts with million arrivals in 2011 (Tourism Malaysia, 2011). Meanwhile, the number of tourist arrivals in 2012 has increased with million and RM60.6 billion of tourist receipts (Tourism Malaysia, 2013). -6-

EISSN 2303-2480 ISSN 2303-2472 During this time, De Palma Hotel Ampang was won the Halal Journal Awards and the hotel was recognized as the pioneer of Shariah Compliant hotel in Malaysia (Wan Shahida

7 EISSN ISSN During this time, De Palma Hotel Ampang was won the Halal Journal Awards and the hotel was recognized as the pioneer of Shariah Compliant hotel in Malaysia (Wan Shahida et.al, 2011). Recently, De Palma Hotel Ampang also recognized as the pioneer of Shariah Compliant hotel in Asian region, unfortunately the hotel is only focusing in external part, for instance Staff attires and alcohol free but lack in internal aspect (Nur hidayah Che Ahmat et.al, 2012). 5. ISSUES AND PROBLEMS Hotel industry is growing rapidly in central and reconstruct city where job opportunities and economic activities occur drastically. Shariah Compliant hotel is one of niche market to be explored. In Middle East, the number of alcohol-free hotels was grown highly in Mecca, Madinah and Dubai. World Travel Organization Report confirmed the huge potential for halal tourism from 2007 (patheos.com, 2010). In 2005, over 150,000 tourists from Middle East travelled to Malaysia and 250,000 tourists chose their destinations based on halal food certificates in 2007 (Eko Nursyanty, 1945). Due to the rose number of tourists, millions of people were staying in luxury, middle class and budget hotels. Do they satisfy with the hotels facilities and services? Demand for Shariah Compliant hotels are getting higher, unfortunately, lack of Shariah Compliant Criteria in hotel management is the main problems among hotel managers (Paul Rosenberg & Hala Matar, 2009) and (Nur Hidayah Che Ahmat et.al, 2012). Consequently, there is low practicing in the implementation of Shariah Compliant in hotel management. For instance, De Palma Hotel Ampang as pioneering of Shariah Compliant hotel in Asian region, unfortunately only focus in external part such as staff attires but lack in internal aspect (Nur hidayah Che Ahmat et.al, 2012). -7-

8 Omar, et al,. PERSPECTIVES ON ISLAMIC TOURISM AND SHARIAH COMPLIANCE IN THE HOTEL MANAGEMENT IN MALAYSIA Figure 3 shows the important of knowledge based in the hotel operations which include development of teaching and learning to the workers. Management objective is to ensure all operations run smoothly and progressively within the organization, which includes hotel operation. Management is a very significant operation in hotel industry which covers many aspects on management activities adhering to Shariah principles. The criteria and the implementation process of Shariah compliant in hotel management are still underdeveloped in Malaysia. This is because not many research being done on Shariah Compliant in hotel management due to lack of people specializes, knowledge and awareness on this subject. The three levels in the hotel operations management illustrate that, first level as operation technique, second level as operation management and the third level as strategic management to enhance the services. 6. METHODOLOGY Content Analysis is one of social science methodology to understand and extracting the content of one particular issues or matters systematically that was applied in this study. There are various types of materials that can be analyzed, for instance text, audio, open-ended interview scripts and field notes from observation. The purpose of this methodology is to build or support an argument and to investigate the important aspects of Islamic tourism and Shariah Compliance hotels in Malaysia. This analysis helps authors to identify evidences from Islamic and contemporary sources on Islamic tourism and Shariah Compliance pertaining to hotel management. This research is still in primary stage of study whereby the authors are able to identify the themes, patterns and describing the situations of the issues on Islamic tourism. At the initial stage of this study the authors had defined the meaning of Islamic tourism and Shariah compliance in hotel management by reviewing literature on the subject matters. Information are being coded to extract the attributes that are valuable for this research. A SWOT analysis is also applied to evaluate the current situation and the parameters of the study. -8-

9 EISSN ISSN ANALYSIS The methods of analysis applied in this research consisted of content analysis and SWOT analysis. Literary works was analysed from articles, books, paragraphs, lines and words that discussed on Islamic tourism and Shariah Compliance. All the pertinent information combined with the contemporary circumstances to describe the current situation using SWOT analysis. In 2005, over 150,000 tourists from Middle Eastern countries visited Malaysia and in 2007, about 250,000 tourists selected Malaysia as their destinations based on halal food certificates (Eko Nursyanty, 1945). The number of Islamic tourists to Malaysia is growing tremendously from year to year and by 2012 it is estimated at 19 million tourists from Islamic countries. The strength and opportunity offered by Malaysia is huge in terms of Islamic tourism products that can be developed in order to cater tourists visiting Malaysia. Among the products that attract Islamic tourists are hotel services and operation, halal food, accessible to prayer facilities and places of attractions. According to the Holy Qur an there are thirteen (13) verses that encouraged people to travel or ziarah places of attractions as stipulated in (Al-Imran:137; Al- An am:11; Yusof:109; Al-Nahal:36; Al-Hajj:46; An-Naml:69; Al-Ankabut:20; Ar- Rum:9,42; Fatir:44; Ghafir:21,82; Muhammad:10). Through these Qur anic verses Allah (swt) calls us to travel different countries of this globe to visit the historical places with having intense intention to know the consequent of previous generations; as they used to lead their worldly lives avoiding and neglecting the laws of Divine such as all the Taghut elements or features. Weaknesses for the research whereas nevertheless, there are few aspects of Islamic tourism products especially Shariah Compliant hotel criteria and the implementation process are still underdeveloped in Malaysia. This is because of not many researches being done in Islamic tourism and Shariah Compliant on hotel management due to lack of people with knowledge and awareness on this subject. 8. CONCLUSION Islam encouraged all Muslims to travel around the world. Tourism is one of the main generating factors to Malaysian economic growth which has contributed large amount of income to the country and in principle, Islam is totally accepting of business in tourism as defined the Holy Koran and the Hadiths but Allah hath permitted trade and forbidden usury (Al-Baqarah 2:275). Of good work The Prophet said working with your hands and all forms of buying and selling which is most legitimate and blessed (Sabiq and Sayyid, 2012) with conditions that there should not be alcohol, drugs, pornography, gambling, pork products or non halal products. As such the purpose of this research is to describe the phenomenon and to explore factors that influenced and interrelated between Islamic tourism and Shariah compliance in tourism products offering. -9-

10 Omar, et al,. PERSPECTIVES ON ISLAMIC TOURISM AND SHARIAH COMPLIANCE IN THE HOTEL MANAGEMENT IN MALAYSIA REFERENCES 1. Abd. Rahman I. Doi. (1984). Shariah The Islamic Law, As Noorden 2. Ali Salman, & Mohd Safar Hashim. (2012). Factors and Competitiveness of Malaysia as Tourists Destination : A Study Of Outbound Middle East Tourists, Asian Social Science, Canadian Centre Of Science and Education, vol.18, Donald E.Lundberg. (1994). The Hotel and Restaurant Business. Wiley, Hoboken, New Jersey. USA. pp Doğan, M. (2011). Türkiye de islami turizmin gelişimi: In Political Economy, Crises and Development. In, Şiriner, İ., Morady, F., Mika, J., Aydın, M., Koç, Ş. A., Kapucu, H. & Doğan, E. (eds.), İstanbul: IJOPEC Publication. 5. Eko Nursyanty. (1945). Halal Tourism, The New Product in Islamic Leisure Tourism and Architecture, University Islamic Bandung, Indonesia. 6. Ibrahim, Z.Zahari, M.S., Sulaiman, M.Othman, Z.,& Jusoff, K. (2009). Travelling Pattern and Preferences of The Arab tourists in Malaysian Hotels.Universiti Teknologi Mara, Shah Alam, Malaysia. 7. Irawan Febianto. (2011). Shariah Compliant Model of Business Entities, published in World Journal of Social Sciences, Vol (1), No.4, pp Islamic Tourism Centre (ITC). Established under the Ministry of Tourism and Culture, Malaysia. All Rights Reserved. Copyright Lina Munirah Binti Kamarudin & Hairul Nizam Ismail. (2012). Proceedings of the Tourism and Hospitality International Conference (THIC 2012). 10.Mahmood Zuhdi Abdul Majid & Paizah Ismail. (2004). Pengantar Pengajian Syariah (2nd ed.). Akademi Pengajian Islam Universiti Malaya, Kuala Lumpur : Al-Baian Corporation Sdn.Bhd. 11.Mohamad Akram Laldin. (2011). Introduction to shari ah and Islamic Jurisprudence, (3rd ed.). Kuala Lumpur: CERT Publications. 12.Mohd Rizal Razalli, Suzzaini Abdullah, & Mohamad Ghozali Hassan. (2012). Developing A Model for Islamic Hotels : Evaluating Opportunities and Challenges, In: International Conference on Knowledge, Culture and Society 2012 (ICKCS), Jeju Island, South Korea, June (unpublished) 13.Nur hidayah Che Ahmat, Ahmad Hidayat Ahmad Ridzuan, & Mohd Salehuddin Mohd Zahari. (2012). Customer Awareness towards Syariah Compliant Hotel, International Conference on Innovation, Management and Technology Research(ICIMTR2012), Malacca, Malaysia, May Osman Bakar. (2011). Islamic Tourism Understanding Its Meaning, Multi- Dimentional Enterprise and Global significance. Presented at World Islamic Tourism Forum (WITF) 2011 co-organized by IAIS Malaysia and GITO Malaysia on July 2011 At Seri Pacific Hotel, Kuala Lumpur. 15.Paul Rosenberg, & Hala Matar Choufany. (2009). Spiritual Lodging-The Sharia- Compliant Hotel Concept. HVS Global Services-Dubai. 16.Peter Jones, & Andrew Lockwood. (2004). The Management of Hotel Operations.TJ International, Padstow, Cornwall, UK. 17.Richard E. Teare. (1998). Developing a Curriculum for Organizational Learning, Journal of workplace Learning, vol.10 No.2, MCB University Press. 18.Siti Anis Laderlah, Suhaimi Ab Rahman, Khairil Awang, & Yaakob Che Man. (2011) A Study on Islamic Tourism: A Malaysian Experience. Published in 2 nd -10-

11 EISSN ISSN International Conference on Humanities, Historical and Social Sciences IPEDR vol.17 (2011) IACSIT Press, Singapore 19.Tajzadeh Namin A.A. (2013).Value Creation in Tourism: An Islamic Approach. International research Journal of Applied and Basic Sciences.vol.4, science Explorer Publications. 20.Wan Shahida, Suhaimi Ab Rahman, Khairil Awang, & Yaakob Che Man. (2011). The Implementation of Shariah Compliance Concept Hotel:De Palma Hotel Ampang, Malaysia. 2nd International Conference on Humanities, Historical and Social Sciences, Press, Singapore, pp Business Dictionary.com (7 June 2013) 22.Gulf Daily News (16 October 2012) 23.Grand BlueWave hotel.com (11 June 2013) 24.Oxford Dictionary online (5 June 2013) 25. Malaysia.gov.my (25 december 2012) 26.WTM Global Travel Trends Report (14 May 2012) 27.World Tourism Organization (WTO). (1981). Tourism Multipliers Explained. Madrid : World Tourism Organization and Horwarth and Horwarth. 28.World Tourism Organization (WTO). (2005). Tourism Highlights. -11-

SHARIAH COMPLIANCE IN HOTEL MANAGEMENT: A CONCEPTUAL FRAMEWORK

SHARIAH COMPLIANCE IN HOTEL MANAGEMENT: A CONCEPTUAL FRAMEWORK Che Musa Che Omar, Noormuthaah Mohamad Ali Adaha, Nor Azzah Kamri chemusa@bis.unikl.edu.my, ruhiyah88@gmail.com, azzah@um.edu.my, UniKL Business