Solidarity actions with Ukraine and hospitality firm value

The objective of this research note is to analyze the effect of solidarity actions following the invasion of Ukraine on hotel and restaurant firms’ market value. Press releases and corporate websites of 117 companies were investigated to determine the actions taken in response to the Russian invasion of Ukraine. Then, using an event study methodology, cumulative abnormal returns were calculated following the actions taken. The results indicate that first movers benefited the most from solidarity actions, while middle-point intensity actions (versus strong or light actions) brought about the highest effects on market value.     

Relationships between external knowledge,internal innovation,firms’ open innovation performance,service innovation and business performance in the Pakistani hotel industry

The purpose of this study is to test the relationships between external knowledge, internal innovation, firms’ open innovation performance, service innovation and business performance in the Pakistani hotel industry. A simple random sample of 285 managerial staff in the Pearl-Continental Hotels & Resorts of Pakistan was surveyed. The findings show that firms’ open innovation performance has a positive influence on service innovation and business performance. They also reveal that external knowledge and internal innovation positively influence firms’ open innovation performance and that further leads to service innovation and business performance respectively. This study provides practitioners with firms’ open innovation performance as a tool to enhance business performance while adopting the strategy.     

Determinants of radical innovation in clustered firms of the hospitality and tourism industry

Social capital is a key resource encouraging innovation in clustered firms of the hospitality and tourism industry, however it may be influenced by managers perception of market dynamism. This paper analyses the moderator role of ma’rket dynamism perception among the three dimensions of social capital −structural, relational and cognitive- and radical innovation. We conducted an empirical study on a sample of 215 hospitality and tourism firms located in World Heritage Cities of Spain, by considering each city as a cultural tourism cluster. The structural equations analysis shows divergent direct and moderated effects for the dimensions of social capital. Specifically, the negative effect of structural social capital on radical innovation worsens when market dynamism perception is higher. However, market dynamism perception improves the effects of relational and cognitive social capital on radical innovation. The study contributes to the understanding of the antecedents of radical innovation at firm level in the context of cultural tourism clusters.     

Internationalization and exposure to foreign currency risk: An examination of lodging firms

Corporate internationalization has often been linked with exposure to risk arising from foreign currency valuation. The theory of economic exposure, however, postulates that when demand and activities are sensitive to purchasing power parities, the value of domestic firms can also be influenced by exchange rates. Suspecting that domestic lodging firms are subject to foreign currency risk, the current study applied a cash-flow model in order to quantify the operating exposure of US lodging firms against currencies that significantly account for visitors to the U.S. Heckman's two-step estimation was subsequently used to examine the effect of internationalization on estimated exposure coefficients. The results indicated that domestic firms are more likely to sustain foreign currency risk, as multinationals may be capable of diversifying away the risk. The higher foreign sales ratio of lodging firms led to greater foreign currency risk, while the increased degree of operational hedging and franchising mitigated the foreign currency risk of multinational lodging firms.     

Analyzing the influence of firm-wide integrated marketing communication on market performance in the hospitality industry

Over the last decade, scholars have recently emphasized the need for tourism marketers to orchestrate the wide range communication activities and forms via the adoption of Integrated Marketing Communication (IMC). However, prior research has almost neglected the role of IMC in hospitality management. This paper adopts a broad organizational approach conceiving IMC as a concept that involves the whole organizational entity and aims to analyze the effects of IMC on market performance, in terms of superior sales and financial results, greater brand advantage and customer-related outcomes for those businesses providing lodging services. To pursue this research purpose, a survey has been conducted among corporate-level senior managers of lodging businesses operating in Spain. The findings provided further and more compelling empirical proof of the positive influence of IMC on market performance, responding to the call for more rigorous empirical research to demonstrate the beneficial effects of firm-wide IMC on market performance.     

Lord,please save me from my sins! Can CSR mitigate the negative impacts of sharing economy on consumer trust and corporate reputation?

The explosive growth of Airbnb not only provides travelers with novel accommodation experiences at prices that suit their budget, but also challenges the existing regulatory and market structures. While Airbnb with its distinct peer-to-peer (P2P) accommodation business model is considered a disruptive innovation in the hospitality industry, little is known about its negative side. This gap in extant literature has motivated the present study, aiming to establish whether the negative aspects of Airbnb undermine consumers' overall trust in the company and its corporate reputation, and whether this link is moderated by corporate social responsibility (CSR). Data required to answer these questions was collected via a survey in which 348 potential Airbnb users in Taiwan, selected using a nonprobability purposive sampling technique, took part. Partial least squares-structural equation modeling (PLS-SEM) was employed to analyze the data. The results indicate that consumers' overall trust in Airbnb is negatively affected by various factors, ranging from legal, regulatory, and taxation issues to fake reviews/listings. The moderation analysis findings further reveal that, while the overall trust−corporate reputation link is strengthened by the environmental and philanthropic CSR, it is weakened by economic CSR, which can lead to unfavorable consumer attitudes and behavioral intentions.     

The interest rate exposure of lodging firms

The purpose of this study is to investigate the interest rate exposure of lodging firms and to determine whether the use of interest rate derivatives reduces this exposure. Using a sample of 47 lodging firms from the period from 2000 to2004, the first stage regression results show that most lodging firms face exposure to interest rates. The key finding of this study is a significant decline in exposure even after controlling for interest and foreign exchange risk. Additional findings show firm size, floating rate debt, interest coverage ratio, and foreign sales ratio to be important determinants of interest rate exposure.     

Knowledge-based resources and innovation in the hotel industry

Although the study of innovation in the hotel industry is a key issue, little is known about the determinants of innovation in this sector, as most innovation research has focused on manufacturing firms or knowledge-intensive services. Furthermore, although research suggests that knowledge is a critical asset for achieving innovation performance, few studies have explored how knowledge operates in the hotel industry. This paper aims to provide empirical evidence about the role played by a set of knowledge-based resources in determining innovation activity in tourist accommodation firms. Data from 109 companies operating hotels in Spain suggest that intangible assets should be considered in this sector when attempting to explain the innovation capacity of firms.     

Can peer-to-peer accommodations act as lodging a stepping-stone for mega-events?

As cities bid for large-scale conventions, they are frequently thwarted by not having sufficient lodging capacity. At the same time, adding new hotels can have negative long-term effects on the city's lodging industry. Drawing on choice theory, this study postulates that one viable solution may be peer-to-peer accommodations, especially during the recovery stage of the post-COVID-19 environment. In this work, researchers conducted a two-part survey of 1212 participants. Results indicate that there were both business and leisure participants whose first choice was a P2P accommodation (20% business: 35% leisure). Between hotel and P2P accommodation travelers, though, there was a significant difference. For those who indicated that a peer-to-peer accommodation was their first choice, location, number of reviews, and star rating were ranked as the most important aspects of an accommodation. The relative importance of the variables differed by type of accommodation (e.g., shared room, etc.).     

Consumer adoption of the Uber mobile application: Insights from diffusion of innovation theory and technology acceptance model

ABSTRACT

The sharing economy literature has largely concentrated on the examination of peer-to-peer accommodation platforms such as Airbnb, with little attention paid on other innovations in collaborative consumption. This study investigates consumer adoption of the Uber mobile application through lenses of two theoretical models – Diffusion of Innovation Theory and Technology Acceptance Model. The results suggest that relative advantage, compatibility, complexity, observability, and social influence have a significant influence on both perceived usefulness and perceived ease of use, which in turn lead to subsequent consumer attitudes and adoption intentions. This study demonstrates the integration of the two classic adoption theories.     

The moderating role of brand diversification on the relationship between geographic diversification and firm performance in the US lodging industry

In spite of the prevalence and strategic importance of diversification for US lodging firms, research on the effects of diversification has been insufficient in the hospitality literature. Especially, an examination of the moderating effect of brand diversification on the relationship between geographic diversification and performance of US lodging firms has been lacking in the literature in various disciplines, including hospitality field thus far. This study aims to first investigate the individual effect from each of brand and geographic diversification strategy on firm performance in the US lodging industry. Further, to investigate effects of diversification comprehensively, this study examines the moderating effect of brand diversification on the relationship between geographic diversification and performance of US lodging firms. The study's results indicate a positive and significant effect of geographic diversification on firm performance, an insignificant effect of brand diversification, and a positive and significant moderating effect of brand diversification in the US lodging industry.     

Towards An Experience Innovation Canvas: A Framework for Measuring Innovation in the Hospitality and Tourism Industry

ABSTRACT

As organizations transition from a service to experience economy, they will need to reimagine their business performance “scorecards” to reflect practices that place the co-created guest experience at the heart of their innovation efforts. This article synthesizes innovation and experience economy literature to depict six theory-based propositions and a framework for measuring innovation in the hospitality and tourism industry. The propositions were investigated in 19 experience firms comprising lodging, dining, attractions, and events in Southern California. Data from executive interviews (n = 19) and follow up manager surveys (n = 202) showed strong support for front of the house innovation focused on guest offerings to enhance interactions, personalization and social spaces and back of the house innovation focused on connecting employees with the firm’s core purpose. Measures of memorable triggers and motivators of emotional value represent promising new frontiers. By identifying the current practices and measures of senior managers faced with leading innovation in their own business units, this study both informs this practice and presents a unique and updated perspective on experience innovation.     

Can corporate social responsibility protect firm value during the COVID-19 pandemic?

The novel coronavirus (COVID-19) pandemic has caused a significant decline in the stock market worldwide, and hospitality companies are experiencing serious financial problems. Protecting and preserving firm value is a critical way of helping hospitality companies survive the crisis. The influence of corporate social responsibility (CSR) on firm value has been widely investigated. However, little is known about the stock price movement following CSR activity adoption during an industrial crisis. Using event study and difference-in-difference method, this study reveals that engaging in CSR activities can increase the stock returns and stakeholder attention of hospitality firms during the pandemic. Community-related CSR has a stronger and more immediate effect on stock returns than customer- and employee-related CSR. Results also indicate that hospitality firms that pursue improved stock market performance during a pandemic can invest in CSR to protect communities, customers, and employees for attracting further stakeholder attention.     

Performance effects of innovation in two-sided markets: The paradigmatic case of OTAs

Online Travel Agents (OTAs) play an important intermediary role in the two-sided travel distribution market. A critical factor that enhances a firm's competitive advantage is innovation. Yet, the analysis of innovation in the OTA context is scarce. The main objective of this article is to fill this gap and examine the effect of OTA innovations on firm performance. We analyze the effect of two-sided market specific innovations (same-side and cross-side) on performance and contribute to the literature by expanding the theoretical understanding of innovations. We find that producer-to-consumer innovations have a greater effect on OTA performance than producer-to-producer and consumer-to-consumer innovations. A fundamental managerial implication is that exchange management is an area to be enhanced when innovating in travel market distribution.     

The importance of human-related factors on service innovation and performance

Firm size, collaboration, foreign ownership and the level of formal training for employees are just some of the key inputs considered to be important in the amount of Service innovation in Tourism firms. However work has called for a greater empirical understanding on service innovation in Tourism and deeper consideration of employment focused practices as front line employees are crucial to innovation. The relationship customers have with service providers is a key determinate of satisfaction and as such the aim of this research is to unpick further the human-related factors associated with this area of study. Data for this research paper were gathered from 201 tourism service firms located throughout Japan. Whilst the results indicate that committed front-line employees and leadership are found to be the primary antecedents of service innovation, knowledge management and instilling creativity through the firm are also key. Our results suggestion that organizations can leverage the benefits associated with human-related factors to enhance service innovation behaviours and increase business performance.     

Board structure and CEO compensation: Evidence from U.S. lodging industry

Using a sample of U.S. lodging firms, this paper examines the relationship between board of director characteristics and chief executive officer (CEO) compensation. Previous research shows that larger boards are detrimental to the effectiveness of the board of directors and deteriorate the control imposed on CEO actions and pay. Board independence is also suggested as an important quality to emphasize the control on the CEO. We propose that U.S. lodging firms’ board of directors provide a nice setting to investigate the effects of size and independence on CEO compensation level. Our findings suggest that CEO compensation is not related to board size, and positively related to proportion of the outside board members. These findings are contrary to the findings of previous studies. Our findings may provide significant insights to lodging firms’ board of directors to structure efficient compensation packages.     

Network,knowledge and relationship impacts on innovation in tourism destinations

We combine network structure and firm-level relationship measures to explore the association between innovative behavior, firm position within the network of a destination, and the knowledge and relational trust characteristics of a firm's innovation-oriented relationships. We find current collaboration, shared knowledge and trust are associated with innovative behavior with partner firms, but that betweenness centrality indicates which partners are the most prominent innovators in a population. That is, relationship-level characteristics facilitate innovation partnerships, but network structure characteristics identify the most successful innovative partners. To theory, our findings contribute to efforts in the tourism, innovation and network literature to evaluate the differential effects of knowledge stocks and flows on innovation. For practice, our results suggest that promoters of innovation within a destination should leverage brokerage positions to improve the in-flow of ideas while encouraging the firms that share knowledge and trust to collaborate to apply those ideas.     

A hierarchical model of technology adoption for small owner-managed travel firms: An organizational decision-making and leadership perspective

This article assesses the diffusion of innovation theory and the technology acceptance model, and explores the factors influencing the decision to engage in technology adoption in small owner-managed travel firms. This is done through the use of the overarching theory of organisational decision-making to identify concepts and constructs which relate to the decision to adopt. The work aims to identify the genesis of adoption decisions in particular where owners are themselves the managers and provide leadership for the organization. After the distillation of factors it was found that due to simple hierarchical structures and decision-making processes which were further exacerbated by immediate self-interest, leadership was the most significant driver. This article goes further to identify leadership typologies at each level of technology adoption in firms.     

Destination social capital and innovation in SMEs tourism firms: an empirical analysis in an adverse socio-economic context

Abstract

This study examines the structural relationships between internal and external resources that explain the innovation of small tourism firms in adverse socio-economic contexts. Specifically, it analyzes two internal resources, human and organizational-technological capital, and the valuable intangible resources derived from social interactions between the agents in the destination (other companies, institutions, and community). The research hypotheses are tested by means of structural equation analysis applied to an empirical study of 180 tourism firms located in Isla Margarita (Venezuela). The findings confirm the importance of external resources derived from relationships with destination agents in the innovation behavior of tourism small and medium-sized enterprises (SMEs). While business social capital affects innovative behavior directly, other types of internal intellectual capital mediate the relationship between innovative behavior and institutional and community social capital. It is the first to address the local community’s role in the innovation of tourism SMEs. The importance of integrating firm and destination resources should inform SMEs’ innovation policies in adverse contexts where the scarcity of resources make vulnerable the economic, social and environmental sustainability.     

Information asymmetry in the innovation adoption decision of tourism and hospitality SMEs in emerging markets: A mixed-method analysis

Investment decisions, particularly innovation adoption decisions, can sustain long-term viability of small and medium enterprises (SMEs). However, information asymmetry could limit the ability of SME management to make informed innovation adoption decisions. Even though information asymmetry is a multidimensional construct, prior literature has only focused on financial information asymmetry in such decisions. Therefore, the current study fills the research gap by conducting two separate studies: one analyzes World Bank Group data from 1250 observations in 11 emerging markets, and the other interviews eight SME owners and managers. The findings of the mixed-method studies suggest that financial, business regulation, and court information asymmetry decrease the likelihood of SMEs' product innovation adoption. The study contributes to a more comprehensive understanding of information asymmetry in SMEs’ decision-making rooted in agency theory. Moreover, its methodological contribution lies in measuring information asymmetry with micro-level data.