Innovation typology in tourism
Miles (2005), for instance, emphasizes the role of IT in services. Since services can be highly IT-intensive, the purchase of IT is one of the main drivers of innovation. Nevertheless, while acquisition of IT may be limited to the purchase of computer applications or artefacts, in some occasions IT acquisitions may require a further development and adaptation. In fact, IT applications are often improved and adapted through the collaboration between provider and user organizations.
In order to explain innovation in services, Barras (1986) proposed the theory of the reverse product cycle as an alternative to the traditional product cycle7. Barras’ theory is related to the transfer of new technologies between users and producers. In his approach, there is a production sector of capital goods and a user sector, mainly represented by services. Major new technologies, which have an influence in the economy as a whole, are created in the capital goods sector. These technologies are then adopted by user sectors. In this regard, the service sector is the major adopter of IT. Nevertheless, in the process of diffusion there is a lag between the moment that capital goods are available and the moment that users adopt this new technology. The origins of these lags are the uncertainty in the performance of the new technology in relation with similar activities carried out by competitors, the capacity to benefit economically from the new technology and the market structure of the adopter industry. Besides, having adopted the new technology, the user sector generates innovative applications through the adaptation and use of the technology. Consequently, adoption and innovation are influenced by specific trajectories in user industries.
The “reverse product cycle" begins when the new technology has been adopted. First, the implementation of the new technology focuses on process innovations that improve the efficiency and reduce costs. Next, the application of this technology benefits quality improvements of services. In a third stage, there is shift from process innovation to product innovations and the application of technology benefits the creation of wholly new services. Having introduced these new services, it is expected that they follow a development similar to the traditional product cycle.
Barras points out that these processes are not linear. In fact, they are based on regular interactions between process and product innovations. Furthermore, the interaction between suppliers and users influences the creation of new innovative solutions, e.g. an innovation in services may create new needs in the user sector, which motivates the development of new technologies in the production sector.
The “reverse product cycle” has influenced research on innovation in services. The theory developed by Barras created a framework for the study of service innovations (Miles 2005). Some of the possibilities to broaden the theory of the “reverse product cycle” are to analyse the development of non-IT innovations and the production of innovations within the sector.
7 In the traditional product cycle, first, innovations are introduced in the market. Then, the product is standardized and process innovations become more relevant. Next, the rate of process innovations decreases and new competitors emerge, which might result in the introduction of new product innovations.