Introduction
The tourism industry has continued to register positive results despite pessimistic economic forecasts across the globe. Global tourism maintained a positive momentum of more than 2% growth between 2010 and 2012. This growth occurred due to an increase in the number of travellers going to different destinations. Market estimations show that tourism will grow by 2.3% by the end of 2013 (Research and Markets 2012).
The amount of money spent by tourists in different parts of the world has increased considerably. This has increased the amount of money earned by countries with large tourism industries. This augurs well for the industry which has experienced many challenges in the past which discouraged tourists from travelling (ITB 2013).
This report highlights issues that affect tourism in Switzerland and Malaysia. The report will evaluate tourism policies in these two regions and how they have affected tourism activities in the last two decades (Klopping 2012). It will also compare the models of innovation and creativity that have made positive impacts on tourism in these countries.
Industry Overview
Switzerland’s Tourism Industry
The Swiss tourism industry has recorded positive growth in the last one year and it earned the country an estimated CHF 35.5 billion in 2012. The industry’s main drivers of growth were transportation, restaurant services and accommodation services, all of which contributed more than CHF 18 billion in 2012 (STF 2012).
These three tourism sub sectors contributed more than 51 percent of total revenues obtained in the industry in 2012. These estimates show that the tourism industry in the country is registering positive results because of its status as one of the most preferred tourist destinations in the world (Barton 2008).
The country’s tourism balance of payments is favourable because foreign tourists spent an estimated CHF 15.4 billion in 2012. Similarly, Swiss tourists who travelled abroad spent an estimated CHF 11.8 billion in the same year. Comparatively, Swiss nationals who travelled to foreign countries spent CHF 11.6 in 2010 and CHF 15.6 billion in 2011, respectively. Switzerland’s tourism industry is one of the most competitive in the world and earns the country high amounts of foreign currency.
The country has experienced an increase in the number of firms that offer specialized services to tourists. There are many tourism firms in Switzerland which target different market segments. Some of the leading firms include; Switzerland Tours, My Switzerland, Incoming Travel Services and Zicasso (Khalid 2013).
Malaysia’s Tourism Industry
Malaysia is one of the most popular and competitive tourist destinations in Asia. Malaysia recorded a 7% increase in the number of tourists visiting the country in 2009. It is estimated that 23.6 million tourists visited the country in 2009 compared to 21.95 million that arrived in 2008. The country’s tourism industry did not experience problems felt by other countries due to the global financial crisis.
Malaysia continues to receive a lot of visitors which has helped the local industry to achieve positive growth. This situation is similar to the favourable industry environment that exists in Switzerland. There are several firms which offer a wide variety of services that seek to take advantage of opportunities existing in the market. These firms are optimistic that positive tourism indicators in the country will help them increase their earnings (Chakraborty 2007).
Market leaders in Malaysia’s tourism industry include Tourism Malaysia, HK Top Tourism, Apple Vacations and Conventions, Cat City Holidays, Ping Anchorage and Tropical Adventures and Tours. These firms have unique niche segments, a situation which is similar to the Swiss tourism industry. These firms have strengthened their brands in the market through differentiation of products and services.
Innovation, Creativity and Enterprise
There are several theories and models which are used to analyse innovation, creativity and enterprise in different tourism sectors. Rothwell’s Five Generations of Innovation Model and Incremental Innovation Theory will be used to analyze Swiss and Malaysian Tourism Industries.
Rothwell’s Five Generation of Innovation Model
This model is considered as one of the most important contributions to the study of innovation in tourism industries. This model captures generations of innovations dating from the 1950’s to the current period (Moutinho 2011). The model looks at various generations of innovation and specific market conditions that made them happen.
It focuses on how different stages of innovations are responsive to various changes in market conditions such as competition, inflation and economic recovery. It also focuses on unemployment, economic growth, industrial expansion and scarcity of resources (Hassanien, Dale & Clarke 2010). This model will mainly focus on generations of Swiss and Malaysian tourism industries from 1990s onwards.
Malaysia Tourism Industry
Malaysia’s tourism industry experienced an awakening during the fifth generation of innovation in the 1990s. This begun when the government launched a five year economic plan in 1991, which spelt out what needed to be done to ensure the local tourism industry became more competitive (King 1993, p. 78).
A key pillar of this plan was the emphasis on research, product development and marketing, which helped the country establish itself as a niche destination for eco and agro based tourism (Malhotra 201, p. 56). The National Tourism Policy formulated in 1992 helped to provide proper regulatory guidance to the local industry (Government of Malaysia 1991).
The country took note of sustainability issues in tourism by launching the National Ecotourism Plan in 1996 to encourage sustainable tourism practices (Government of Malaysia 1996). This fifth generation of innovation has made the country’s tourism stand out due to its high quality attractions and environmental sustainability (Government of Malaysia 2001).
Swiss Tourism Industry
The industry’s innovative practices took root during the fourth generation in the 1980’s. it easily attained the fifth generation of innovation because many firms were willing to offer new products and services to their customers (Wurz 2013). Major tourist attractions in the country include historical sites, unique cuisine, luxurious accommodation and a wide range of entertainment activities (Koumelis 2013).
This has helped the country maintain its status as one of the most visited tourist destinations in the world. The Swiss tourism industry is built on four main pillars which are economic, ecological, cultural and local community sustainability. This has made it easy for the country to maintain product diversity which appeals to different tourist segments. The industry encourages different players to explore more opportunities and implement new technologies to help them have a positive impact.
Incremental or Radical
Coles and Hall (2008) reveal innovation and creativity can either be incremental or radical, depending on the firm managing the process. Improvements made in existing technologies, processes and products are referred to as incremental innovation (Hall & Wouldiams 2008). Innovation that is initiated from the beginning meant to overhaul different industry systems is known as radical innovation. Radical innovation is very difficult to implement but offers long term benefits to a tourism industry.
Malaysia’s tourism industry before the fifth generation was based on incremental innovation, which stifled the development of innovative products and services (Peng 2010). The implementation of new policies encouraged adoption of new technologies which improved performance of firms active in the sector.
Radical innovative approaches encouraged ecotourism to flourish which made more visitors tour waterfalls, rivers and agricultural parks. Technological advancements have also revolutionized the quality of services offered in the industry. Most booking and ticketing services are done electronically, which has made it easy for different industry players to collaborate.
Switzerland’s tourism industry also uses new technologies to improve the quality of services offered. The country has a competitive edge over other destinations because it has diversified its tourist attractions to cater for niche customer interests.
It offers ecotourism, reverie tourism, agro-tourism, and holiday entertainment (Hall & Piggin 2003). The country improved its transport and communications infrastructure with neighbouring countries, which has made it easy for tourists to visit different places.
Conclusion
Both Switzerland and Malaysia are key tourist hubs in their respective regions. Their industries have recorded positive growth in the last few years. Five generations model and incremental or radical theories have been used to describe innovative tourism practices in the two countries.
Malaysia managed to streamline its tourism sector in the fifth generation of innovation which improved the quality of services offered to tourists visiting the country. Switzerland was able to put in place effective innovation, creativity and enterprise pillars in the third generation. These approaches have made tourism sectors in the two countries more competitive.
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