Abstract
This case study is intended to analyze, through a longitudinal analysis, the radical business model innovation experienced a Cantabrian tourism company that exploits a protected cultural property called “El Capricho de Gaudí.” More specifically, this chapter focuses on the manager attitudes toward risk and their influence on response strategies implemented to redefine and renew this business model for competitiveness and survival. The results of the analysis contribute to generate knowledge about how a solid and well-established small experienced cultural-based tourism enterprise reformulates its business model to survive in time of crisis.
TopIntroduction
The environment volatility and the current economic situation that is affecting the world with a high prevalence on tourism sector companies (Arcese, Valeri, Poponi & Elmo, 2020; Ritchie & Jiang, 2019; Cró & Martins, 2017) has forced business to look for new ways for creating value for customers and value capture in companies. Currently, we are witnessing the difficulties for the survival of many companies, especially small and medium enterprises (SMEs) in the service sector in general, and tourism in particular. Tourism is impacted by many external factors, including political instability and economic conditions (Okumus, Altinay, & Arasli, 2005), natural disasters, wars and, more recently, biological risks such as the Covid-19 health crisis (Arcese, Valeri, Poponi & Elmo, 2020; Gössling, Scott, & Hall, 2020; Jones, & Comfort, 2020). Within this context, small and medium tourism enterprises (SMTEs) are being more vulnerable to crisis impacts due to their limited capacities to reduce risk (Zeng, Carter, & De Lacy, 2005). Consequently, solid and well-established SMTEs have seen their profitability reduced, forcing them to rethink about how they must adapt to the new competitive conditions derived from the crisis that affects us (Morgan, Anokhin, Ofstein, & Friske, 2020; Osiyevskyy & Dewald, 2018). This fact has caused SMTEs to pay much more attention to analyzing their business models, which describe the bases on which a firm delivers value to customers and converts payment into profits (Teece, 2010). In the search for new ways to generate value and survive in time of crisis (Morgan, Anokhin, Ofstein, & Friske, 2020; Osiyevskyy & Dewald, 2018), innovation in business models as part of the firm´s strategic renewal process (Musa & Mamun, 2020), emerges as an option fully applicable to the tourism sector (Breier, Kallmuenzer, Clauss, Gast, Kraus & Tiberius, 2021; Bogers & Jensen, 2017; Alegre & Berbegal-Mirabent, 2016; Souto, 2015; Spieth, Schneckenberg, & Ricart, 2014; Zott & Amit 2010). In fact, business models are becoming a new conceptual tool complementary to the company’s strategy that is receiving increasing attention from the scientific and professional community (Prescott & Filatotchev, 2021; Hjalager & Madsen, 2018; Massa, Tucci, & Afuah, 2017; Bocken, Short, Rana, & Evans 2014; Zott, Amit, & Massa 2011). That is because of its potential to analyze, compare and evaluate business performance and results (Massa, Tucci, & Afuah, 2017). Despite its relevance, the analysis of the strategic renewal process of business models has been less present both in the economic literature and in the business management literature (Teece, 2010). However, there is a growing streem of literature (Foss & Saebi, 2017; Foss & Saebi, 2018) analyzing the business model innovation, its relationship with the process of organizational change, the type of innovations generated as well as the outcomes derived from a company’s business model innovation.
Key Terms in this Chapter
Crisis: Situation in which something or someone is affected by one or more very serious problems.
Business Model Innovation: Business model innovation is the art of enhancing advantage and value creation by making simultaneous—and mutually supportive—changes both to an organization's value proposition to customers and to its underlying operating model.
Value: Value in business models is the worth in monetary terms of the technical, economic, service, and social benefits a customer company receives in exchange for the price it pays for a market offering.
Business Assets: Items of value owned by a company. Business assets span many categories. They can be physical, tangible goods, such as vehicles, real estate, computers, office furniture, and other fixtures, or intangible items, such as intellectual property.
Tourism Sector: The tourism industry is the total of all businesses that directly provide goods or services to facilitate business, pleasure and leisure activities away from the home environment.
Cultural Experience-Based Tourism Enterprises: Quite broadly, cultural experience-based tourism enterprises indicate a type of tourism that is different from more conventional tourism ( Stamboulis & Skayannis, 2003 AU26: The citation "Stamboulis & Skayannis, 2003" matches multiple references. Please add letters (e.g. "Smith 2000a"), or additional authors to the citation, to uniquely match references and citations. ) and is characterized with offerings with a relatively high degree of differentiation and intangible value perceived by the customers at a certain place and in a certain time. The basis for differentiating can be linked to elements such as specific themes, extreme contexts, novel and innovative arrangements offering exclusiveness, perceived experience value, specialized competence, multiple sense involvement and other elements that increase the perceived value for the customer.
Business model: A business model is a “concise representation of how an interrelated set of decision variables in the areas of venture strategy, architecture, and economics are addressed to create sustainable competitive advantage in defined markets” ( Morris, Schindehutte, & Allen, 2005 : 727). It has six fundamental components: Value proposition, customer, internal processes/competencies, external positioning, economic model, and personal/investor factors.