Moderating Role of Service Innovation on the Relationship between Service Quality and Performance of Hotels in Kenya

Abstract

This study investigates the influence of service innovation on the relationship between customer orientation and the performance of four-star hotels in Kenya. Questionnaires were administered to employees and managers of 43 selected hotels in the Hospitality Industry four-star hotels that had undergone hotel classification by Tourism Regulatory Authority as of 2018 ensuring they met the standards required for the study. Secondary data was also extracted from hotel reports including customer feedback and performance reports. Data analysis was doen using SPSS,STATA and SmartPLS. Moderated multiple regression (MMR) statistical instrument was utilized to test the moderating effect of service innovation on customer orientation and performance The key findings reveal that factors such as customer satisfaction, reputation, service quality, and customer loyalty significantly influence hotel performance. Moreover, service innovation plays a crucial moderating role, enhancing the positive effects of customer orientation on performance. This implies that hotels in Kenya can improve their performance by adopting innovative practices that align with customer needs and expectations.This study provides practical recommendations for hotel managers and policymakers. It emphasizes the importance of fostering a culture of innovation and customer orientation within the industry, which can ultimately contribute to sustainable growth and long-term competitiveness in Kenya's tourism sector.

Keywords: Service Quality, Service Innovation, Performance and Hotel

DOI: 10.7176/JTHS/68-05

Publication date: February 28^th 2025