Chapter Preparing tourism businesses for the digital future Abstract

Information exchange, learning and research: Direct information, communication, booking and check-in channels have reduced the need for certain types of frontline jobs and led to a displacement of traditional employment relationships by more precarious independent contractor arrangements in, for example, transport and accommodation. It has also generated demands for different skill sets and new types of jobs.

According to the United Nations World Tourism Organization (UNWTO, 2019a), the most demanded profiles by companies in the tourism sector over the next five years are expected to be: digital/IT, customer focus, data analytics, operations, commercial, leadership/management and administration/finance. Yet, tourism businesses may not have the financial or management capacity to employ tech experts or invest in workforce training. They may instead rely on consulting services which can be expensive and ad hoc, and higher education institutions are often not incentivised to engage in small practical capacity-building projects. The Austrian government has addressed this gap by establishing the Research Expertise for the Economy programme in co-operation with the Austrian Research Promotion Agency (FFG) to support digitalisation of the economy including tourism businesses.

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  Business innovation: Business models, practices, cultures and strategy all influence the openness and willingness of tourism SMEs to undertake digital transformation. With the help of new technologies, the traditional cost of doing business has decreased significantly, allowing some businesses to grow at an unprecedented pace (UNWTO, 2019b). Many lifestyle and micro-enterprises in the sector are focused on business survival, are risk averse and have little appetite for innovation, while large firms have the capacity, financial and otherwise, to make significant investment.
  

Also, differences between the fundamental nature of some tourism business subsectors such as the accommodation, transport, reseller industries greatly influence their capacity and speed to adapt to the digital ecosystem.
These trends have contributed to a productivity gap between traditional tourism SMEs and their digitally enabled counterparts. Incubators, accelerators and labs that encourage partnerships between tech and tourism companies may improve openness to innovation and knowledge exchange. However, these current supports often focus on the start-up tech dimensions, such as business model innovation, attracting venture capital investment, and do not address the challenges existing tourism businesses face in going digital.
While these supports have launched high value companies in ride-sharing and accommodation-sharing, existing accommodation SMEs, for example, may have problems in appropriating value from these kinds of programmes. The objectives of such incubators, labs and accelerators should be carefully articulated to reflect needs on the ground.

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