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Open Innovation: The Future of the Hotel Industry

Innovation technology has been one of the most popular topics discussed in business circles in recent years. While most corporations want to innovate in one way or another, the results of such innovations and their overall impact on the bottom line could become overshadowed if in-depth research is not conducted.

This has had the effect of some hotels not being quite sure what really constitutes an impactful innovation, with innovation even, in some cases, being regarded as an enemy of success because its implementation means that customers also start to compare all establishments, including competitors, on the basis of the new experiences they offer.

Large hotel chains tend to have an advantage in achieving their innovation goals as they traditionally have better access to knowledge-based tools. However, SMEs tend to be more adaptable when it comes to facing the challenges associated with change.

Nonetheless, it is not always easy for either side of the spectrum. No matter what their size, companies do not have the resources (time, knowledge and budget) to work on multiple types of innovation at the same time. Choosing a strategy on how to innovate is therefore essential.

1. Innovation in hotels

The first mistake is to think that innovation is only about new products. Any improvement to the user experience is also innovation and may simply involve a basic update of existing tools and features. The goal will always be to positively influence the client. Hotel companies are finally understanding the importance of creativity and the relationship between having an entrepreneurial mindset, creative thinking and its positive impact on innovation. There is no exclusive territory for innovation, nor is it the sole preserve of big budgets. There are as many forms and models of innovation as there are types of companies.

2. The innovation sector

Innovation in the hotel sector must focus on the customer, who is the cornerstone of the hotel’s business model, and the immediate future will require that he or she be made part of the conversation. This concept refers to the open innovation model devised by Professor Henry Chesbrough of the Garwood Center for Corporate Innovation at the Haas School of Business, University of California, Berkeley. The open innovation model invites companies to develop an innovation strategy through cooperation with external organisations and professionals, including the hotels’ own customers.

3. How to innovate in hotels of any size

Implementing the practices of open innovation has multiple benefits, including shortening the time needed to research and bring a solution to market. In addition, including customers in the development of new solutions will make the filtering of ideas more efficient, since they are the main beneficiaries and the ones who have the strongest link with the experience. In addition to customers, hotels have the option of involving their employees in open innovation processes. In this way, both audiences contribute to creating new solutions and improvements and all become active creators in innovation.

4. How to leverage open innovation in hotels as a strategic partner

Open innovation is therefore a very good option to innovate in any hotel and to promote the advancement of the hotel industry. Harnessing the full force of open innovation also requires attracting innovative employees. Management must decide what type of innovation it wants to introduce, when and at what pace, as well as what types of synergies will be created within the organisation. All these factors mean the company must identify which employees are best suited to work in teams to these ends. Innovative companies attract innovative employees and vice versa. This is something we see frequently at Les Roches, where there is an employee-employer match within the innovation ecosystem that works on its own. Innovation demands transformative people who collaborate, share, and have the ability to integrate knowledge and experience.

5. Become an innovator

Innovative employees are not just those with great ideas, but those who dare to experiment, apply their experience, and transfer it to others. The future of the hotel industry needs professionals who are reliable, independent, capable of handling uncertainty, as well as open to pivoting and readjusting if the project requires it. Innovation is knocking at our door.

Susana Garrido is Digitality & General Education Program Manager, and Senior Lecturer in Marketing, at Les Roches

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