PERCEIVED EFFECTIVENESS OF INNOVATION IN SMALL AND MEDIUM SIZE HOSPITALITY ENTERPRISES IN NEPAL

Prakash Kumar Gautam

Abstract


In developed as well as developing economy, service industry is gaining boom with vulnerability in sustaining growth. Customer’s expectations are advancing because of new service providers and easy excess in information technology. Nepal, as experiencing rapid changes in social, political and economic dimensions, appealing to domestic corporate houses as well as foreign investors. Business Confidence Index (BCI) provides good confidences indicators in hospitality, making the industry environment dynamic. Specially, small and medium size organizations face more challenges to create low cost and consistent products. Literature suggests four different dimensions i.e. product related innovation, process related innovation, organization related innovation and market related innovation. This study aimed to examine the perceived effectiveness of innovation in SMEs in Nepal. Structured data from 227 self-administered respondents were collected. Factors conformation and impact analysis were conducted with EFA, CFA and SEM with Process Macro for moderating effect analysis. Four constructs as suggested by literature were extracted but only two constructs market related innovation and product related innovation found to have significant relationship with perceived effectiveness of innovation. Only gender confirmed moderating effect on the relationship between product related innovation and perceived effectiveness.


Keywords


Service innovation, Product innovation, Process innovation, Market innovation, Perceived effectiveness

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