The National Institute of Higher Education, Research, Science and Technology (NIHERST) conducted a national survey on innovation in the tourism sector in Trinidad and Tobago.

The results of the survey should provide insights into the innovation process and assist decision makers in developing policies to create the environment and incentives to catalyse innovation in the industry.

Summary of Main Findings

Innovation Activities

• The majority of establishments (83%) that responded to the survey were local/privately owned, and licensing/franchising arrangements or management contracts were negligible, thereby nullifying this form of technology transfer for these establishments.
• Product innovation was shown to be more widely practised than process innovation. Of the responding establishments, 53-64 % engaged in some form of product innovation, compared to 33 (44%) of establishments which engaged in process innovation. Product innovation was manifested more in improvements to existing goods and services (64%) than in the introduction/development of new goods and services (53%). Process innovation was more prevalent in improvement in the methods of production for goods and services (44%) than in the improvement of delivery or distribution methods (33%). Process innovation also extended to the improvement of support activities (44%). Product innovation was more prevalent in Trinidad than in Tobago, while the reverse was observed in the case of process innovation. Process and production innovation were reported in both the lodging and accommodation, and the leisure and entertainment sub- sectors.
• The main areas of focus on organisational innovation were the introduction of new business practices for organisational procedures (50%), the improvement/expansion of education and training (44%), the introduction of major changes in organisational structure and new management systems and techniques (33%), and the establishment of new relationships with external organisations (25%).
• With respect to marketing innovation, 69% of the establishments reported the introduction of new marketing strategies, 53% introduced new media techniques for promotion, 44% introduced new methods for utilising new sales/marketing channels, 36% introduced new pricing methods and 39% developed/ accessed new market segments.
• Environmental innovation encompassing energy efficiency/ conservation, minimisation of wastes and hazardous and materials, reduction in air, noise and water pollution, was practised by between 36-69% of respondents. Fifty percent (50%) of respondents reported improved compliance with environmental regulations.
• Innovation activities showed only moderate impact on sales over the period 2007-2008. For example, 35-37% of the establishments that engaged in product innovation reported increases in sales over the period. Similarly, 25-33% of the establishments that introduced/ improved process innovations, 14-36% of the establishments that engaged in marketing innovations, and 17-37% of the establishments that practised some form of organisational innovation, experienced sales increases over the period. In addition, between 22-33% of the establishments that introduced/improved environmental innovations recorded increases in sales.

Driving Forces and Obstacles to Innovation

• The following reasons for innovating were cited by respondents as very important:
  • Improve customer satisfaction (89%)
  • Improve profitability (83%)
  • Improve service quality (81%)
  • Improve productivity (81%)
• The main obstacle to innovation was identified as the lack of financing and the high cost of the innovation project, (44%), followed by domestic economic conditions (36%), and lack of skilled/qualified personnel (33%). On the other hand, 42% of respondents indicated that lack of information on technology, marketing capability and external technical support were not relevant/appropriate. Twenty-two (22%) percent of respondents indicated that weak customer demand was very significant and 31% moderately significant, while 22% reported it as not relevant/appropriate

Linkages and Collaboration

• Information from within the establishment was identified as very important by 78 % of the respondents, while 72% gave a similar rating to information from customers. Business and industry associations were viewed as very important by 33% of respondents, compared to 25% for professional journals and trade publications and education and research institutions. However, 56% of respondents indicated that they did not use education and research institutes.
• Nineteen percent (19%) of respondents viewed suppliers of equipment, material and components of software as very important, while 33% stated that they were moderately important and 42% did not use them. Likewise, government or public research institutions were viewed as very important by 19% of respondents, while 22% stated that they were moderately important and 53% did not use them. Fairs, exhibitions and conferences were considered very or moderately important by 14% and 28% of respondents, respectively, while 53% did not use them. Similarly, consultancy services were considered very or moderately important by 11% and 19% respectively, while they were not used by 64% of the establishments.
• Customers and associated companies were identified as the most significant partners with respect to entry into co-operative/collaborative arrangements (25%), followed by suppliers (19%). Cooperative arrangements were also entered into with government ministries (17%), universities or higher education institutes (14%), and consulting and marketing establishments and competitors (14%). Only 3% of establishments entered into such arrangements with private and public research institutions.

Impact of Innovation

• The impact of innovation was reported to be greatest with respect to increased customer satisfaction (81%), improvements in image (75%) and increased competitiveness (69%). Fifty-six percent (56%) reported a positive environmental impact, while between 44-50% recorded increases in profitability, market share, good/service differentiation and compliance with regulations. Only 39% and 31% of respondents reported that innovation increased cash flow and employment, respectively..

Use of Technology

• Seventy-five percent (75%) of establishments were engaged in innovation requiring the use of technology. Of these 93% indicated that the innovation was related to the use of ICT. Only 1 establishment utilised patents to protect its intellectual property. Others, however, utilised trademarks, confidentiality agreements and trade secrets to some extent to protect their intellectual property.
• The vast majority of respondents, 92%, utilised the Internet, while the same percentage used it for e-mail. Eighty-nine percent (89%) utilised the Internet for world web searches and to sell products or services to clients, and 83% for advertising through a home page.

Role of Government

• The majority of respondents (83%) had not utilised government support or assistance in their innovation activity. Government support programmes were viewed as non- applicable by an overwhelming 86% of establishments. Compliance with local laws or standards was identified as very important for innovation by 61% of respondents, while 56 % reported that their innovative activity had a positive environmental impact.
• Government or public research institutions were rated as very/moderately important sources of information by 41% of respondents. Collaboration with government ministries was acknowledged by 17%, while only 3% indicated any involvement with public research institutions. However, 42% of respondents stated that legislation/legal restrictions/administrative procedures were very/moderately significant obstacles to innovative activity.
• Respondents indicated that government could encourage innovation in establishments by, among other concerns: help with marketing; provision of financial support; improve the general condition of Trinidad and Tobago; improve the technology infrastructure; provide advice and programmes on research and development, and reduce taxes.