BTEC HND Hospitality: Innovation Concepts and Strategies

This report delves into the concept of innovation within the hospitality industry, exploring its historical context and significance. It examines various models of innovation, including incremental, disruptive, architectural, and radical approaches, and analyzes their impact on business performance. The report identifies the factors driving innovation in the hospitality sector, supported by organizational examples, and reviews diverse innovative concepts and approaches implemented in the industry. Furthermore, it proposes a new innovative concept for the hospitality industry, assessing its market potential and feasibility for successful implementation. The report provides a comprehensive overview of innovation's role in shaping the hospitality landscape and driving business growth.

Concept of innovation in
hospitality

Table of Contents
Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
TASK 1............................................................................................................................................1
Argue the model of ‘innovation’ and different causes of innovation. .......................................1
Analyze the significance of innovation to business performance...............................................5
TASK 2............................................................................................................................................7
Analyze the factors driving innovation in the hospitality industry using a range of
organizational examples..............................................................................................................7
TASK 3............................................................................................................................................9
Review a range of different innovative concepts and approaches that have been implemented
in the hospitality industry using specific examples.....................................................................9
TASK 4..........................................................................................................................................11
Conceive an innovative concept for the hospitality industry that has market potential and
feasibility to take to market.......................................................................................................11
Pitch an innovative concept for the hospitality industry..........................................................11
CONCLUSION .............................................................................................................................11
REFERENCES..............................................................................................................................13

INTRODUCTION
Innovation plays vital role in the development and increase in the new ideas of the
business that helps to promote the business in the hospitality industry. This assist the hospitality
business to improve and develop consistent changes in the business to meet the demand and
needs of the customers. Innovation and invention in the hospitality business provide effective
development of changing needs of the customers in order to fulfil the needs of the business in the
market. use of innovation in the hospitality business is necessary for the development of
effective customer base and improvement in the current services of the hospitality (Chen, 2017).
An innovation strategy is required for the development and growth of the competitive advantages
in the market. innovation in the hospitality now play major role in the development and growth
of effective market segment and customer base. Innovation is the strategic tool that business
could use to increase the level of effective business growth and development of the market base.
It is important for the hospitality businesses to drive various trends in the innovation so that they
can achieve their future targets of profitable business growth. This report includes
information about the innovation concept in the hospitality and its importance in the growth and
development of organization.
MAIN BODY
TASK 1
Argue the model of ‘innovation’ and different causes of innovation.
History of innovation – Product innovation is defined as development within product,
design or process. There are lot of benefits which a company can has by implementing
innovation within products. Innovation started in 19th century and it began as a term which is
associated with industry and science (Chou and et.al., 2020). Revolution was the era where
invention developed a prestigious as well as positive connotation.
Innovation is practical implementation of the idea and thoughts as a result to introduce new
services or product in the market. It is an idea that has been transformed into practical reality to
develop the business in innovative way and gain better development of product and services in
the business. Its helps the business to improvement improved growth and accomplishment of
areas and aims of the business to improve the market performance of the organization.
Innovation improve the level of effective communication between the needs and improvement of
1

actual customer base to gain better knowledge and information about the demand of customers.
The growth of business accomplishes when the meet the market trends and compete the
competitors in operative way. Concept of the innovation presents the idea and information about
the needs of the business venture and its growth in the marketplace.
According to the views of Lee, Hallak and Sardeshmukh, (2019), it is analysed that
innovation is defined as a concept for successful development of existing product into new and
more effective one. It is more useful for managing the work and capturing present market needs
to enhance the customer value. Innovation is the best way that ca be used by companies to
manage their focus for increasing customer satisfaction and sales. from the views of Marasco and
et.al, (2018), it is concluded that innovation has different stages which are used to improve and
enhance the present product’s quality offered by the company. Different action plans are
developed by company mangers to enhance the innovation process.
For the effective development of market base the business needs to change its innovation
strategy with the time and efforts. New ideas in the business help to develop effective
marketplace so that competitive edges can be gained by the businesses. There are different types
of innovation explained below:
Types of innovation:
Incremental innovation: it is one of the greatest collective form of innovation, it utilize
the existing technology and increase cost for the consumers within the existing market of the
firm. All the business use incremental innovation in their business to develop effective customer
base and growth of their current market. Adding new features can helps the businesses to
develop their existing product and services more valuable (Patiar and et.al, 2017). This enhance
the customer value and this provide customer better opportunity to use the product or services in
more innovative manner.
Disruptive innovation: It assist business to apply new technology or process in the
company’s current marketplace. The new technology in the business often more expensive for
the business and it could increase the level of expenses for the business. For the development of
new customer base company can use this in their firm to improve the level of customer base and
gain better efficiency in the market. It could be difficult for the business to develop new
technology for the business and its growth in the marketplace (Sørensen and Grindsted, 2019).
2

Architectural innovation: This innovation skills and technology is lesson with the
organization and apply it with the different market. This helps to increase new customers as long
as new market is interested. Most of the time company faces hue risk in this situation due to
reliance and reintroduction. This can provide the business huge power on the mid of their
customers to increase the level of effective business growth (Yeung and Al Mashary, 2019).
Radical innovation – This is known as type of invention that destroys the present
business model used by company (Pikkemaat, Peters and Bichler, 2019). This type of innovation
is not good as it blows up the present system and process used by company for making the
product or service.
Contribution of innovation Helps to differentiate- Innovation when used in product, service or process helps the
business to differentiate itself from that of the competitors. It provides the the competitive
advantage to the company as it involves doing something which is not yet being done by
anyone. It involves making optimum utilization of the resources so that the organization
can make use of the resources in order to drive innovation. For instance, if the Rosewood
hotel makes use of virtual check in, it may bring enhanced services to the customers
which will help in attracting customers.
 Improves performance- Innovation helps in making improvisation in the working and
performance of the company as it brings something new in the working which can
provide easiness in working. For instance, a hotel may get engage in automated record
keeping of customers so that its working is made easy (Thangiah and et. al., 2019).
Source of innovation:
Management source:
 Process needs: It is the innovation that created support to other process or product. The
generation of needs increase the level of innovation that business wants to develop. This
includes significant changes in technique, software, or equipment. Process needs involve
identification of the weak points of the company and correct that spot to develop effective
changes. For example, hotel can bring such software which can help in keeping touch
with customers by greeting on festive occasions, etc.
 Service’s needs: This innovation includes services of product or service of process in
order to make changes in the current situation. This innovation need does not always
3

relate to the technology or technique (Rodríguez-Victoria, Puig and González-Loureiro,
2017). This impact the development of effective changes that increase the level of
effective customer base and proficiency. For instance, hotel may introduce such
innovation which can help customers to have virtual check in and check out service in
order to enhance performance.
 Physical production needs: product innovation is the creation and introduction of new
product in the market that promote the business and increase new market segment. The
need of actual innovation in the product occurs when the market trends are affecting the
business and current product. For instance, a hotel may introduce new food item in its
hotel like a fusion of Italian and Chinese so that it can provide different product to the
customers.
Non- management source:
 Psychology: This increase when the demand of the customer’s changes according to the
needs of innovation and development of actual source of innovation. Psychology source
innovation increase when the market trends are changing and the demand of customer is
also changed.
 Design: When customers get tired of using the old designs, it is seen that companies try
to modify the existing design. This helps to meet the requirements of customers. Regular
innovation within design helps to increase the product efficiency also. It helps in ensuring
better experience for customers which involves improving existing product or service or
develop a new one. For example, Rosewood hotel can offer pick and drop services from
airport to hotel in order to bring changes in its services for better customer experience.
 Culture: Changes in the culture of the customer base or change in the market segment
increase the effect of cultural changes on the product or services of the business. There
must be a culture of innovation wherein each employee is engaged in bringing new ideas
which can shape the business towards growth and success. For example, the managers
may provide liberty to subordinate to share their ideas for bringing innovation so that
innovative culture is brought (Lin and Chen, 2018).
4

Analyze the significance of innovation to business performance.
Innovation play significant role in development of business’s effective performance in
the market. Innovation in the business important to attracts the people towards the product and
services company offer to them in most innovative way. Innovation improves the current
product or services or can help the business to develop innovative and new product or services
that can help them to enhance the level of effective performance in the marketplace.
According to Pete Foley (2020), innovation is a process used for executing the business
activities efficiently. It is clear that innovation helps the company to manage work as well as
sales of the company. This is concluded from the views of Romero and Tejada, (2020), there
are several organisations that believe that innovation is an important task that has to be used
within organisations for effective functioning. When companies will involve in more innovation,
there are chances of increasing the sales and performance properly.
Innovation provide insight about the market trends that can have the effect on the
performance and growth of the company. Creative ideas and thoughts can support the business
person to growth the level of effective evolution of the organization and increase in the customer
preferences. There are various significance of the innovation in order to improve the
performance of the business is explained below:
External importance:
 Competition: Innovation assists the company to deal with one of the biggest external
factor that effect the business and its performance. Competition in the market can be
minimizes with the use of effective innovative ideas that can help the business to increase
the level of business growth and profitability in the market. Innovation helps the business
to gain advantages in the market and deal with the competitors.
 Lower cost: Use of effective technology and innovation in the business helps to reduce
the cost of production of product and services. New technology enhances the level of
business growth that develops with the use of effective sources and growth of innovative
product and services in the market (Vallone and et. al., 2020).
Market drivers: Innovation benefits the business with the increase in market drivers that can
help business in enhanced growth and development of goals and ideas of business.
1. Demand: It helps the company to increase the level of market demand for the product
and services. This influences the buying decision of the customers and encourages them
5

to buy the product and services of company. Main focus of a company for innovation is
basically for meeting the needs and demands of customers. This helps to manage the
existing reputation of company’s products and enhancing the customer satisfaction level.
When new and innovative products or services are provided to people, they will be more
attracted towards taking service from the company.
2. Economic forces: Innovation assists the business to develop effective economic sources
that helps the business in better growth and effective level of profitability. The source of
income is also increase by the use of effective innovation in the business. For example,
the rise in population may help in increasing the sales as more people are targeted to avail
the services of company.
3. Social changes: Innovation motives businesses to increase the level of social changes so
that effective growth to the goal and aim of the business can be achieved. Social changes
in the business motivate the growth and enhancement social changes by the innovation in
the business.
4. Technology: Innovation helps in efficient use of the technology wherein the
organizations are engaged in deploying the technology. For example, the Hilton hotel can
get engage in social networking technologies by tracking the goodwill and social profile
of its supplier's and other stakeholders in order to built its social network (Filimonau and
Naumova, 2020).
Internal importance:
 Improve profitability: Innovation is the tool that increase the level of changes that
business has in the market to perform various operations in most appropriate manner.
Innovation assists company to make changes that increase their profitability and growth
in the marketplace. Better opportunities in the market increase the level of effective
growth and enhancement of current profit of the business operations. For example,
innovation attracts more of the customers due to enhanced level of service due to
innovation which thereby enhances sales and results in more profits for the company.
 Improve cash flow: It improve the level of cash inflow and outflow by the increase in
the sale of product and services in the business to perform the task in most effective
manner. From the effective source of information there are various growths that business
can achieve by the use of innovativeness in the market.
6

 Improve quality: Innovation benefits in the improvement of quality of current product
and services of the company so that effective growth can be achieved by the business.
This provides insight about how business can perform various activities in the innovation
to improve the level of profitability in the business. For instance, when the digital
payments were introduced in hotels, it replaced the traditional means of payment like
cash. So innovation helps in improving quality of the services.
 Improve ROI: Innovation provide the investor to increase the level of investment in the
business so that effective growth and enhancement of goals and objectives can be
achieved in appropriate manner. For example, when a company brings such innovation
product or services, it attracts the investors which a hope that they will get high return
from their investment as innovation fosters profitability and raises profit (Bhushan,
2019).
TASK 2
Analyze the factors driving innovation in the hospitality industry using a range of organizational
examples.
There are various innovation divers that assist the business of hospitality towards the
achievement of the objectives of business also this can assist business more benefits and growth
in most effective manner (Uen and et.al, 2018). Appropriate innovative tools and operations can
increase the performance of business and also enhance the level of business development in the
hospitality sector. Innovation enhances the level of business growth and efficiency in the market
to improve the level of effective business development. Innovation assists the development of
effective product and services to gain maximization of industry growth and development. Below
is explanation of several factors driving innovation in the hospitality industry:
Technology advance innovation: Use of innovation in the hospitality industry is become
common to encourage the customers to use the product and services offer by the business in
hospitality. With the use of many mobile technology and social media application business
influence the decision making process by the use of effective productivity and growth of the
business in the market. Social media play vital role in the enhancement of customer demand for
the product and services in the hospitality.
7

 Use of social media to engage the customers: In hospitality sector there are many
businesses that use social media campaign to engage the customers towards the
business and influence them to use the services they offer to them. This also
increases the interest of the customers by the creativity and innovation in the social
media promotion.
 Multimedia platform for the promotion: Use of innovativeness in the promotion
of services and product offer by the hospitality can also help the business to enhance
the level of business growth and enhancement of goals and objectives of business.
Multi media channels can help the hospitality business to engage customers in most
appropriate manner to use the services they offer to them.
 Digital disruption in hospitality: Use of innovative and digital technology can
promote the business in the industry and increase the level of customer base in most
effective manner. Digital technology can enhance the level of business growth and
can help in the fulfillment of objectives in most effective manner (Agnihotri, 2021).
Consumer led demand: change in the consumer needs and demand can also effect the level
of innovation in the hospitality business to improve the level of innovativeness and enhancement
in the objectives of innovation. Change in the choice and preferences of the customers can also
impact the level of innovativeness in the business to perform various activities in the business so
that proper growth and development of the resources can be done.
 Level of income: The level of income group of the people can also impact the business
growth and development of innovation in the hospitality. The choice and preferences of
the customers changes with the income status and culture of the people in the business
8

group. Level of income group can enhance the level of profitability and encourage the
customers to rise the income group in the hospitality sector.
 Free time: Time if the most effective factor that can influence the demand of the
customers and can enhance the level of effectiveness in the development of growth and
actual profitability (Rajput, Zahid and Najaf, 2018).
Business strategy factor: There are several strategies that business could use to increase the
level of effective performance and growth in the hospitality industry. They can use business
strategy to improve the level of customer base that business could improve by the use of
appropriate strategic innovation. Business strategy factors involve the many strategic tools that
promote the business and its growth in the market. For the development of the resources and
information about the actual growth to deal with effective sources of information. Innovative
strategy is made by examining the future trends.
 Penetration and expansion strategy: This strategy business use them they wants to
expand the market base or wants to target new customer segment in the new market. This
help the business to improve the level of innovation in the strategic development to gain
better growth in the hospitality sector.
 Ethical business practices: This could benefit the business to attract the new customers
towards the business. Also ethical practices could help the business to expand the level of
effective business growth and development of the resources. By engaging different
ethical practices in the organization, the business involves in strategy which can faster
innovation so that its ultimate goal is achieved. Without the innovative activity, there is
no goals, orientation and path (Wang and et. al., 2020).
TASK 3
Review a range of different innovative concepts and approaches that have been implemented in
the hospitality industry using specific examples.
Co-living and AirBnB: Co- living is modern concept of the innovation in the hospitality
business that provide private rooms in the well-furnished home with the share of common area. It
is popular in many cities as a means of affordable living for the students, individual relocating,
workers etc. co living is the concept that support the effective living standard with the low prices
and affordable for everyone (Zach, Krizaj and McTier 2018). AirBnB is one of the concepts the
9

support the effective living of the people and support their effective future development. It has
increased the availability of rooms, low price for customers especially in high peak time (Gurran,
Searle and Phibbs, 2018).
CRM: It is the concept of the management that support the effective relationship with the
customers and use of tools and techniques that support the consumer relationship management
tool. This use by the hospitality business to enhance the level of effective future growth and
development of the resources to gain better development of the objectives. It is one of the power
ally for the hotels as it acts as successful marketing of hotel, helps in achieving the profitable
operations by targeted marketing and builds deeper relationship with groups, guests and the
corporate clients. It is important to have the customer relationship management as easy to
integrate with the existing system. Secondly it must have multiple channel like CRM must
records the interaction across in person, email, online and text. Thirdly, it must be automated and
within the budget. Its main contribution in hospitality industry is that it helps in maintaining
better and positive relationship with the customers so that they are retained and loyal customer
base is maintained. The main advantage of this software of this that it keeps the record of all
guest and helps in maintaining interaction with them so that they are retained in the organization
(Chang and Sokol, 2020).
10

TASK 4
Conceive an innovative concept for the hospitality industry that has market potential and
feasibility to take to market.
Innovation in the hospitality industry enhance the level of effective growth that business
gain due to the use of effective source of innovativeness in the businesses. For the effective
development of customer base hospitality can use Artificial Intelligence for the development of
effective customer base and enhancement of growth and objectives of the business. This trend in
the hospitality impact the mind set of the customers and that assist the better growth of business
and enhancement of effective services they could provide to their customers. Use of technology
that can help the guest in the hotel in self check in and check out can help the business to
improve the level of customer experience from the hotel business (Caldicott and et. al., 2020).
There is also many trends in the business of hospitality that support effective services and growth
of enhancement in the product they provide to the customers. For the better development of goals
and objectives business can assist the level of growth and effectiveness in the market. Hospitality
business can assist better development of customer demand and the needs they have in the
current marketplace. in order to achieve the target customer base business should use the
effective sources of innovation in the new technology that can support the growth and
development of business in the industry.
Pitch an innovative concept for the hospitality industry
Innovation in the hospitality increase the level of effective business development and meet
the needs and demand of the customers in most effective manner so that effective growth to the
resources can be achieved. Innovative concept in the hospitality can improve the level of
effective business growth that been achieved in the business to gain better objectives. Innovation
can help the business to enhance the level of customer base to improve the level of effective
market competition and growth of the business in the market (Janakova, 2018).
11

CONCLUSION
From the above information it can be summarise that innovation play significant role in the
hospitality industry for the better growth and development of the resources in the business for
most effective manner. it assists business to develop effective market base to gain better
productivity and growth of the business in the market. there are many sources of innovation in
the hospitality business that support the growth and enhancement of the objectives in the market.
for the effective development of the resources there are many businesses that develop better and
effective growth in the market. for the better development of innovation in the hospitality there
are various sources that can help the business to analyse the needs and demand of the business in
the marketplace. innovation play vital role in the engagement of the customers in the
marketplace to enhance the level of effective growth and development of the resources in the
hospitality sector.
12

REFERENCES
Books and Journals
Agnihotri, R., 2021. From sales force automation to digital transformation: how social media,
social CRM, and artificial intelligence technologies are influencing the sales process.
In A Research Agenda for Sales. Edward Elgar Publishing.
Bhushan, S., 2019. Design thinking in hospitality education and research. Worldwide Hospitality
and Tourism Themes.
Caldicott, R.W., and et. al., 2020. Airbnb–exploring triple bottom line impacts on
community. International Journal of Culture, Tourism and Hospitality Research.
Chang, H.H. and Sokol, D.D., 2020. How incumbents respond to competition from innovative
disruptors in the sharing economy—The impact of Airbnb on hotel
performance. Strategic Management Journal.
Chen, B.T., 2017. Service innovation performance in the hospitality industry: the role of
organizational training, personal-job fit and work schedule flexibility. Journal of
Hospitality Marketing & Management, 26(5), pp.474-488.
Chou, S.F., and et.al., 2020. The critical criteria for innovation entrepreneurship of restaurants:
Considering the interrelationship effect of human capital and competitive strategy a case
study in Taiwan. Journal of Hospitality and Tourism Management, 42, pp.222-234.
Filimonau, V. and Naumova, E., 2020. The blockchain technology and the scope of its
application in hospitality operations. International Journal of Hospitality
Management, 87, p.102383.
Gurran, N., Searle, G. and Phibbs, P., 2018. Urban planning in the age of Airbnb: Coase,
property rights, and spatial regulation. Urban Policy and Research, 36(4), pp.399-416.
Janakova, M., 2018. Crm & social networks. Academy of Strategic Management Journal, 17(5),
pp.1-15.
Lee, C., Hallak, R. and Sardeshmukh, S.R., 2019. Creativity and innovation in the restaurant
sector: Supply-side processes and barriers to implementation. Tourism Management
Perspectives, 31, pp.54-62.
Lin, Y. and Chen, H., 2018. Critical factors for enhancing green service innovation. Journal of
Hospitality and Tourism Technology, 9(2), pp.188-203.
Marasco, A., and et.al, 2018. Collaborative innovation in tourism and hospitality: a systematic
review of the literature. International Journal of Contemporary Hospitality
Management.
Patiar, A., and et.al, 2017. Information and communication technology–Enabled innovation:
Application of the virtual field trip in hospitality education. Journal of Hospitality &
Tourism Education, 29(3), pp.129-140.
Pikkemaat, B., Peters, M. and Bichler, B.F., 2019. Innovation research in tourism: Research
streams and actions for the future. Journal of Hospitality and Tourism Management, 41,
pp.184-196.
Rajput, A., Zahid, M.M. and Najaf, R., 2018. Using CRM to model firm performance in a
business-to-business market. Journal of Relationship Marketing, 17(2), pp.118-151.
Rodríguez-Victoria, O.E., Puig, F. and González-Loureiro, M., 2017. Clustering, innovation and
hotel competitiveness: Evidence from the Colombia destination. International Journal of
Contemporary Hospitality Management.
13

Romero, I. and Tejada, P., 2020. Tourism intermediaries and innovation in the hotel
industry. Current Issues in Tourism, 23(5), pp.641-653.
Sørensen, F. and Grindsted, T.S., 2019. Tourism Experience Innovation in Nature Parks. In 28th
Nordic Symposium on Tourism and Hospitality Research: Tourism and Hospitality at a
Crossroads.
Thangiah, S.R., and et. al., 2019. Greggg: A Scalable High-performance, Low-cost Hospitality
Robot. In Robots, Artificial Intelligence, and Service Automation in Travel, Tourism
and Hospitality. Emerald Publishing Limited.
Uen, J.F., and et.al, 2018. Supervisory mentoring and newcomer innovation performance in the
hospitality industry. International Journal of Hospitality Management, 73, pp.93-101.
Vallone, C., and et. al., 2020. Can the New Hospitality Model of Albergo Diffuso Solve the
Overtourism Issue? The Case of Tuscany. In The Overtourism Debate. Emerald
Publishing Limited.
Wang, K., and et. al., 2020. Adaptive Driving Scheme for ZVS and Minimizing Circulating
Current in MHz CRM Converters. IEEE Transactions on Power Electronics, 36(4),
pp.3633-3637.
Yeung, A.A. and Al Mashary, S., 2019. Emaar hospitality group: Expo 2020 Dubai’s official
hotel and hospitality partnership. Worldwide Hospitality and Tourism Themes.
Zach, F.J., Krizaj, D. and McTier, B., 2018. Learning from press releases: implications for
hospitality innovation. International Journal of Contemporary Hospitality Management.
14