Making innovation happen through building social capital and scanning environment

Both new service development and existing service improvement are critical tools for hotels to gain competitive advantages, but pursuing new services while simultaneously improving existing services is difficult for hotel managers. The success of highly proactive hotel managers has been credited to their ability to change the environment effectively, and such managers may be able to lead hotels to resolve the trade-off dilemma and deliver better services. To elucidate the contributions of proactive managers in making innovation happen, this study explored two key activities that hotels may undertake when prompted by the proactive managers, namely, environmental scanning and social capital building. The process involved in developing new services and improving current services was examined using empirical data collected from the general managers of 226 hotels in Taiwan. The results confirm that environmental scanning and social capital fully mediate the relationship between proactive personality of managers and capacity for service innovation as well as service improvement of hotels, indicating that hotel managers with a proactive personality are helpful at implementing innovation.