A STUDY ON THE IMPACT OF ORGANIZATIONAL INNOVATION ON THE ORGANIZATION PERFORMANCES OF HOSPITALITY FIRMS (WITH REFERENCE TO SOUTH INDIA)

Generally, the literature says that the hospitality industry plays an important role in the development of the country to a superior level. However, the performance says the hospitality industry still has not reached the stage of full potential. To improve performance, the hospitality industry needs to realize its full potential and seize any opportunities to upgrade them to become more competitive. To remain competitive, the hospitality industry has to shift towards higher value-added activities and adopt the best industry business practices. Hence the hospitality industry needs to change their mindset to transform themselves to support the strategies of India to become a high-income, developed country. This transformation requires the hospitality industry to develop its organizational resources and capabilities that will move them to become a more competitive, innovative, and technologically strong sector. With rapid globalization, firms particularly those in the service sector have to continuously innovate for competitive advantage. One way to do so is via effective innovative practices. The purpose of this study is to examine the relationship between organizational performance and types of organizational innovation. We employed a cross-sectional design with a sample comprised of 494, large hospitality service providers from six states in India which were identified as having a high percentage of innovating practices. Three types of organizational innovation (IT innovation, Management innovation, and Marketing innovation) served as our dependent variables. Our findings provided partial support for our main hypothesis. In the study, it was found to have a positive and significant effect on the three forms of organizational innovation. Even though our research framework was partially supported, our study highlights the profound role played by innovation in stimulating organizational performance in the context of the service industry of India. Implications of our findings and limitations of the research were discussed