International tourism is one of the major vehicles of economic development in industrializing countries in the twenty-first century. Countries with tourism-based economies keep developing strategies and approaches for employing their comparative advantages to remain competitive. However, rapid globalization has increased the competitiveness in the tourist industry even more complex, including hotel industry. The industry players not only have to compete locally or nationally, but globally. Reduction of operations cost no longer the core competence that contributes to a firm’s performance. Other strategies such as organizational effectiveness, increase of market share, improvement of customer retention and service innovation has become key capabilities that provide better benefits to the firms. Therefore, this research employs a cross-national, survey-based methodology to find out the model that suitable to help a hotel to understand its’ internal and external factors that may contributes in delivering better performance. This study proposes a hotel’s technology-organization-environment (TOE) context is significant to service innovation management which leads to achieving sustainable competitive advantage. A total of 204 hotels from Taiwan and Malaysia is used to test the conceptual model and hypotheses. The findings lead to several key findings: (1) Technological context and organizational context are positively affects service innovation management. (2) The service innovation management in the hotel is related to its’ sustainable competitive advantage significantly. (3) Overall, the model is comparatively better in explaining the practices in Taiwan. However, the technological context is comparatively more significant for Malaysian hotel operators; and the organizational context is rather more important in Taiwan. The insights from this study can help the hotel managers from both Taiwan and Malaysia to have a better understanding of the current phenomenon in the industry and manage their service innovation more efficiently in gaining sustainable competitive advantage. The researcher suggested developing other factors, i.e. flexibility and safety to be included into TOE framework as it facilitates creativity, innovation and speed that able to contribute to sustainable competitive advantage.
International tourism is one of the major vehicles of economic development in industrializing countries in the twenty-first century. Countries with tourism-based economies keep developing strategies and approaches for employing their comparative advantages to remain competitive. However, rapid globalization has increased the competitiveness in the tourist industry even more complex, including hotel industry. The industry players not only have to compete locally or nationally, but globally. Reduction of operations cost no longer the core competence that contributes to a firm’s performance. Other strategies such as organizational effectiveness, increase of market share, improvement of customer retention and service innovation has become key capabilities that provide better benefits to the firms. Therefore, this research employs a cross-national, survey-based methodology to find out the model that suitable to help a hotel to understand its’ internal and external factors that may contributes in delivering better performance. This study proposes a hotel’s technology-organization-environment (TOE) context is significant to service innovation management which leads to achieving sustainable competitive advantage. A total of 204 hotels from Taiwan and Malaysia is used to test the conceptual model and hypotheses. The findings lead to several key findings: (1) Technological context and organizational context are positively affects service innovation management. (2) The service innovation management in the hotel is related to its’ sustainable competitive advantage significantly. (3) Overall, the model is comparatively better in explaining the practices in Taiwan. However, the technological context is comparatively more significant for Malaysian hotel operators; and the organizational context is rather more important in Taiwan. The insights from this study can help the hotel managers from both Taiwan and Malaysia to have a better understanding of the current phenomenon in the industry and manage their service innovation more efficiently in gaining sustainable competitive advantage. The researcher suggested developing other factors, i.e. flexibility and safety to be included into TOE framework as it facilitates creativity, innovation and speed that able to contribute to sustainable competitive advantage.