This chapter examines innovation and innovation management in the tourism industry. To this end, the chapter first defines innovation for businesses in the tourism industry and investigates the importance of innovation, characteristics of innovation in tourism businesses, and types of innovation. In addition, the stages of the innovation development process for successful innovation management in tourism businesses, the factors that prevent the development of innovation, and the success factors for the development of innovation are discussed. This chapter will contribute to the development of an insight into the importance of innovation in the tourism industry, which is highly dynamic, variable, and risky, and reveal the factors necessary for the creation and implementation of successful innovation programs.
TopIntroduction
Innovation is a critical element in providing competitiveness and realizing profitability and growth in the tourism industry (Ottenbacher & Gnoth, 2005; Orfila-Sintes et al., 2005; Nicolaua & Santa-Maria, 2013). To gain a competitive advantage, tourism businesses need to develop new products, meet the expectations of existing and potential customers, and produce higher-quality products (Hjalager, 2002; Sundbo et al.,2007; Aldebert et al., 2011). For innovation to develop, having an innovative perspective is essential. Innovative businesses outperform their non-innovative competitors because of their ability to provide different products and services (Martínez-Ros & Orfila-Sintes, 2009; Nicolaua & Santa-Maria, 2013). Today, innovation is seen as way to turn environmental changes into opportunities and thus succeed (Huse et al., 2005; Chen, 2011).
Tourism is a variable and dynamic industry. It is heavily influenced by environmental changes (Orfila-Sintes et al., 2005; Hall & Williams, 2008). Tourists’ increasing knowledge and expectations, rapidly changing customer interest, the adaptation of new technologies to the industry, and coexistence of innovation and sustainability reveal the need for innovation and how difficult it is (Hall & Williams, 2008; Tseng et al., 2008; Sengupta & Dev, 2011; Chen, 2011). Tourism industry includes a wide range of services, including food and beverages, entertainment, transport, and accommodation. When a tourist goes to a destination, he/she uses most of these services, and the quality of these services affects the experience of the tourist (Orfila-Sintes et al., 2005; Hall & Williams, 2008). This condition points to the importance of networking and establishing cooperation among the companies inside and outside the industry in developing innovations in the tourism industry (Aldebert et al., 2011).
Understanding the characteristics of tourism products is important in realizing innovation. Many factors affect innovations in the tourism industry, which makes it difficult to understand and make innovations. Innovations in tourism are made on different scales: both at the scale of individuals, businesses, and destinations and tourism centers and at the scale of the national tourism system. Therefore, innovation is spread across the entire tourism system, from a restaurant offering a new dish or a travel agency designing a website to a hotel using state-of-the-art technology to serve its customers (Weiermair, 2006; Hall & Williams, 2008).
This chapter defines innovation in the tourism industry and investigates the importance of innovation, characteristics of innovation, types of innovation and the factors that affect the development of innovation in tourism businesses.