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ARLA
32,1 Using information technology to
achieve management innovation
20 Uso de tecnologías de la
Received 16 February 2016
Revised 14 June 2016
información para lograr
11 September 2016
25 January 2017
27 July 2017
innovación organizativa
19 August 2017
Accepted 25 November 2017 Julia Nieves
Department of Economic and Management,
University of Las Palmas de Gran Canaria,
Las Palmas de Gran Canaria, Spain, and
Javier Osorio
Department of Economy and Business Management,
Facultad de Economia Empresa y Turismo,
Universidad de Las Palmas de Gran Canaria, Las Palmas de Gran Canaria, Spain

Abstract
Purpose – The purpose of this paper is to assess the relationship between information technology (IT) use
and management innovation through the mediator role of knowledge-based resources.
Design/methodology/approach – The paper presents empirical evidence from a survey of 109 companies
that run hotel establishments in the Spanish territory. A model of relationships is proposed and tested
through a system of structural equations.
Findings – The use of IT favors the development of organizational knowledge and the ability to integrate
this knowledge. Moreover, a positive and direct relationship was found between IT use and management
innovation, and indirectly through organizational knowledge and knowledge integration capability.
Research limitations/implications – The designed questionnaire did not include any questions related to
specific IT tools that could contribute to better knowledge management practices in hospitality organizations,
but rather generic questions about IT use. The large number of IT tools that can potentially support
knowledge management practices in hospitality companies would make the questionnaire unwieldy for its
target respondents.
Originality/value – This paper sheds light on a topic that has hardly been studied in the services literature.
Specifically, it addresses the way organizations can facilitate management innovation through the use of IT,
while considering the mediator role of knowledge-based resources.
Keywords Information technology use, Management innovation, Organizational knowledge,
Knowledge integration capability, Hotel industry
Paper type Research paper

Academia Revista
Latinoamericana de
Administración
Vol. 32 No. 1, 2019
pp. 20-39
© Emerald Publishing Limited
1012-8255
DOI 10.1108/ARLA-02-2016-0037
Resumen
Objetivo – El objetivo de este estudio es evaluar la relación entre el uso de las tecnologías de la información
(TIC) y la innovación organizativa a través del papel mediador de los recursos basados en el conocimiento.
Metodología – El trabajo presenta evidencia empírica a partir de una encuesta realizada a 109 empresas que
gestionan establecimientos hoteleros en todo el territorio español. Un modelo de relaciones se propone y testa
mediante un sistema de ecuaciones estructurales.
Resultados – El uso de TIC favorece el desarrollo del conocimiento organizacional y la capacidad para
integrar dicho conocimiento. Además, se encontró una relación directa y positiva entre el uso de TIC y la
innovación organizativa, así como una relación mediada por el conocimiento organizacional y la capacidad de
integración del conocimiento.
Implicaciones/limitaciones – El cuestionario diseñado no incluyó preguntas relacionadas con Using
herramientas de TIC específicas que pudieran contribuir a mejores prácticas de gestión del conocimiento
en empresas de alojamiento turístico, sino preguntas genéricas sobre el uso de TIC. El gran número de information
herramientas de TIC que potencialmente pueden apoyar las prácticas de gestión del conocimiento en las technology
empresas de alojamiento, complicaría la cumplimentación del cuestionario por parte de los encuestados.
Originalidad/valor – Este estudio amplía el conocimiento sobre un tema escasamente estudiado en la
literatura de servicios. En concreto, se aborda la forma en que las organizaciones pueden facilitar la
innovación organizativa a través del uso de TIC considerando, simultáneamente, el papel mediador de los
recursos basados en el conocimiento. 21
Palabras clave Uso de TIC, Innovación organizativa, Conocimiento organizativo, Capacidad de
integración del conocimiento, Industria hotelera
Tipo de papel Trabajo de investigación

1. Introduction
Technological innovation has traditionally received attention from researchers (Volberda
et al., 2013). For years, studies have focused mainly on the development of new products
(product innovation) and new production techniques (process innovation) (Tether, 2003).
This theoretical framework does not consider all the possible manifestations of innovation;
therefore, it underestimates the innovative potential of services companies (Gallouj, 2002;
Souto, 2015). However, in recent years, researchers have incorporated non-technological
forms into the study of innovation, such as marketing innovation, business model
innovation and management innovation (Armbruster et al., 2008; Gallego et al., 2013).
According to the Oslo Manual, “Non-technological innovation covers all innovation
activities which are excluded from technological innovation. This means it includes all the
innovation activities of firms which do not related to the introduction of a technologically
new or substantially changed good or service, or to the use of a technologically new or
substantially changed process” (OECD/Eurostat, 2005, p. 88). The empirical research related
to non-technological forms of innovation is still in the embryonic stage, as little is known
about its specific drivers and correlates (Černe et al., 2013).
Within the categorization of non-technological innovations, scholars have shown a
growing interest in understanding how management innovation is developed and
implemented (Meuer, 2014). This paper focuses on management innovation and, specifically,
how certain knowledge resources favor it. Management innovation consists of (Volberda
et al., 2013, p. 3): “changes in the way management work is done, involving a departure from
traditional processes (i.e. what managers do as part of their jobs); in practices (i.e. the
routines that turn ideas into actionable tools); in structure (i.e. the way responsibility is
allocated); and in techniques (i.e. the procedures used to accomplish a specific task or goal).”
There are discrepancies in the criteria used to define the novelty of an innovation
(Damanpour and Aravind, 2012). Most researchers argue that for a management technique
to be considered innovative, it is enough for it to be new in the organization where it is
implemented (Mol and Birkinshaw, 2009). However, some scholars argue that the innovation
must be novel not only in the organization, but also in the sector (Hamel, 2006).
Management innovations can arise without a special infrastructure, and they are
idiosyncratic and relatively intangible, characteristics that can make them a source of
competitive advantage (Mol and Birkinshaw, 2009; Vaccaro et al., 2012). This type of
innovation is an internal process of the company, and it generally leads to unique and
distinctive actions of the adopting organization (Damanpour and Gopalakrishnan, 2001;
Hecker and Ganter, 2013). In addition, the knowledge involved in management innovations
has an important tacit component that impedes its comprehension and assimilation by
external agents (Hecker and Ganter, 2013). These characteristics limit the possibility that
these innovations can be imitated or replicated by other organizations (Černe et al., 2013;
Volberda et al., 2013). Thus, whereas in the area of services, product innovations can easily
ARLA be imitated (Hjalager, 2010), the internal, complex and ambiguous nature of management
32,1 innovations impedes imitation, providing greater possibilities of achieving competitive
advantage (Mol and Birkinshaw, 2009). Therefore, innovations in organizational practices,
policies and structures are especially important for service activities (Gallego et al., 2013;
Parga-Dans et al., 2013; Van der Aa and Elfring, 2002). However, compared to the
manufacturing sector, the service sector is considered less advanced with regard to the
22 introduction of management innovations (Hellström et al., 2015).
This paper extends and adds knowledge to previous empirical research carried out
mainly in other economic sectors. Using samples that include a broad range of industries,
different authors show that management innovation is a result of employees’ qualifications
and the external search for new knowledge (Mol and Birkinshaw, 2009), the organizational
memory and learning capability (Camison and Villar-Lopez, 2014), leadership behaviors
(Vaccaro et al., 2012), the exchange of knowledge (Černe et al., 2013), a commitment-based
HR system (Ceylan, 2013), intensity of competition (Hecker and Ganter, 2013) and
technological innovation (Cerne et al., 2015). The study by Lin et al. (2016), carried out
exclusively in manufacturing companies, reveals the antecedent role of dynamic capabilities
in management innovation. In service companies, Chang (2016) found that management
innovation is determined by multilevel transformational leadership. Specifically, in studies
carried out in the hospitality sector, Orfila-Sintes and Mattsson (2009) suggested that
management innovation would increase with more university employees and training,
Nieves and Segarra-Ciprés (2015) showed that human capital and external relationships
favor management innovation and Qin et al. (2015) found that these innovations arise from
the company’s idiosyncratic collective mindset.
Regarding the role of information technology (IT) use in management innovation, the
study by Cerne et al. (2015) in companies belonging to different economic sectors shows that
IT systems development and use partially mediate the relationship between knowledge
exchange and management innovation. As far as we know, no empirical study has evaluated
the role IT use plays as a driver of management innovations in hospitality companies.
The purpose of this paper is to advance the state of knowledge by providing empirical
evidence regarding the role IT use plays in the adoption of management innovations in
companies that run hotel establishments. Specifically, it addresses the way organizations
can use IT to facilitate management innovation through the mediator role of organizational
knowledge and the knowledge integration capability. Furthermore, it provides a response to
one of the suggestions for future research proposed by Okumus (2013a), which is to study,
by collecting data from organizations, how they facilitate knowledge management practices
by using IT tools leading to innovation. In addition, this study attempts to take a closer look
at the findings of Lievrouw and Finn (2009), who pointed out that knowledge exchange can
contribute to management innovation through the use of IT systems that allow members of
organizations to communicate and share ideas quickly and efficiently.
The literature on IT is quite extensive and linked to a large number of organizational
variables that have awarded it a relevant role within the area of management. This study
will also show the contribution of IT to the development of what is currently considered a
core challenge for firms in trying to successfully compete, that is, management innovation.
Moreover, attention should be paid to something that favored the strong development of IT
in the 1980s, the fact that numerous authors justified its strategic nature (e.g. Jackson, 1989;
Neo, 1988; Porter and Millar, 1985; Wightman, 1987). The common thread in their
publications consisted of theoretical arguments about the way IT use could lead to
achieving competitive advantage in firms. These seminal studies, although lacking a
contrasted theoretical base to support the theses, had a strong impact on management
decisions about investing in this technology. Over the years, papers have provided empirical
support for the strategic nature of IT (Gimenez et al., 2015; Moliner-Velázquez et al., 2015;
Sirirak et al., 2011). This study makes a contribution in this direction by justifying that, both Using
directly and indirectly, IT use positively influences management innovation. As a corollary, information
we can defend the strategic role of IT based on studies linking management innovation to technology
achieving competitive advantage in organizations (e.g. Camison and Villar-Lopez, 2014;
Damanpour and Aravind, 2012; Ganter and Hecker, 2013; Vaccaro et al., 2012).
This paper is organized in the following way. The second section presents the theoretical
background and hypothesis development. The following sections describe the methodology 23
and results of the empirical study carried out. The final sections provide the discussion,
conclusions, implications of the paper and highlight its limitations.

2. Theoretical background and hypothesis development

The knowledge-based perspective proposes that firms’ performance depends on the
creation, management and use of knowledge (Grant, 1996; Spender, 1996). This perspective
emerges from the resource-based view of organizations (Barney, 1991), and it is based on
the premise that knowledge is a basic resource. This resource is manifested as the
heterogeneous flow and storage of knowledge, whose combination can be unique and
produce competitive advantages (Rock and Ahmed, 2014). The literature is unanimous in
pointing out that the mere availability of resources does not necessarily provide companies
with advantages. What often makes a resource valuable is the way it is managed by the
company (Kor and Leblebici, 2005; Mahoney, 1995). Consequently, knowledge management,
that is, the processes and practices through which companies generate value based on their
knowledge resources, represents a strategic action for organizations (Grant, 2006; Kang
et al., 2007). Yang and Wan (2004, p. 595) understood knowledge management to be “the
process of collecting and identifying useful information (i.e. knowledge acquisition),
transferring tacit knowledge to explicit knowledge (i.e. knowledge creation or transfer),
storing the knowledge in the repository (i.e. organizational memory), disseminating it
through the whole organization (i.e. knowledge sharing), enabling employees to easily
retrieve it (i.e. knowledge retrieval), and exploiting and usefully applying knowledge
(i.e. knowledge leverage).” Although these activities go beyond the management of
technologies and information, many knowledge management activities are based on the use
of IT as an important facilitator (Alavi and Leidner, 2001; Lloria, 2008). IT tools not only
make it possible to accumulate a large amount of information or increase the speed of access
to it, but they also provide means for communication and interaction (Cross and Baird, 2000;
Olivera, 2000). For example, through the creation of virtual collaborative groups, IT systems
can contribute to strengthening, expanding and sharing organizational knowledge through
time and space (Alavi and Leidner, 2001).

2.1 IT use and organizational knowledge

IT is a driver that organizations can use to satisfy their labor needs and increase their
performance; it is an exogenous force that affects the behavior of individuals and
organizations (Markus and Robey, 1988). Borghoff and Pareschi (1997) pointed out that IT
clearly has potential as a means to transform knowledge work processes. The role played by
IT in the creation, storage, transference and application of organizational knowledge has
been well established (Grover and Davenport, 2001; Roberts et al., 2012). The adoption of
developments in the field of IT, such as groupware, online databases, intranets, etc., has
allowed firms to produce higher quality goods and services and achieve competitive
advantages (Hendriks and Vriens, 1999; Holsapple and Joshi, 2002; Lynn et al., 2000; Quinn
et al., 1997). D’Adderio (2001) proposed that the role of IT in supporting cooperation among
the functional areas of the firm by coordinating their knowledge and activities depends on
their integration capability. Sher and Lee (2004) stated that IT is an indispensable element in
current knowledge management practices designed to achieve competitive advantage.
ARLA It is difficult to establish a complete list of all the IT tools used in hospitality
32,1 organizations to facilitate knowledge management practices. However, with this end in
mind, Okumus (2013b) developed a comprehensive list of IT systems that can contribute to
improving knowledge management practices in hospitality organizations, based on
previous studies. The list includes: employee competency database, decision support tools,
video conferencing, teleconferencing, data mining, groupware for discussions, expert
24 network, case-based experience database, e-mail, documentation management, online
knowledge searching, data warehousing, online training and learning, workflow, enterprise
portal site, search engines, exogenous professional database, enterprise resource planning,
supply chain management, customer relationship management and revenue management.
Therefore, the use of IT can contribute to strengthening and expanding organizational
knowledge by allowing the existing knowledge in the company, often disperse, to be
efficaciously stored and accessible (Alavi and Leidner, 2001). Likewise, these technologies
are effective tools that allow the set of prior knowledge developed throughout the
company’s history to influence its current activities (Stein and Zwass, 1995). Moreover, these
technologies not only make it possible to accumulate a large amount of information or
increase the rate of access to it, but they also provide means for communication and
interaction (Olivera, 2000). Consequently, firms will have to foster the use of IT and motivate
their employees to share their knowledge through it. Based on this line of reasoning, this
paper proposes the following hypothesis:
H1. IT use is positively related to organizational knowledge.

2.2 IT use and knowledge integration capability

The knowledge integration capability can be understood as the ability to integrate
knowledge within and across organizational boundaries (Henderson, 1994). The
integration capability is so important that it can justify differences in project
performance between different companies (Leonard-Barton, 1992; Teece et al., 1997).
Authors such as Nonaka (1994) and Okhuysen and Eisenhardt (2002) stated that the
ability to integrate the internally available knowledge requires a shared perspective about
what problems or challenges have to be faced, in order to allow the existing knowledge to
be combined and reformulated to produce new solutions. This shared perspective is
achieved through social interactions between individuals who use internal communication
channels. These inter-unit relationships are the basic way to transfer specialized internal
knowledge (Tsai, 2001). Transferring knowledge allows its re-use, and recombining
existing knowledge is an important antecedent of management innovation (Marjchrzak
et al., 2004; Terwiesch and Loch, 1999).
Integrative practices can be either formal or informal. The former have an institutional
nature and are developed to foment organized knowledge integration within and among the
departments in the entity (Alavi, 2000; Grant, 1996). The latter are based on spontaneous
and unstructured interactions among employees. They complement the formal knowledge
integration practices by constructing a community spirit and mutual trust (Brown and
Duguid, 2001; Davenport and Prusak, 1998). Knowledge integration is strongly based on
vertical and horizontal coordination mechanisms to facilitate the transfer of knowledge, and
the act of coordination itself can be considered an integration process that facilitates the
comprehension of objectives, as well as the means to reach those objectives (Reich and
Benbasat, 1996).
Roberts and Grover (2012) proposed that IT use and knowledge creation together
constitute an example of organizational synergy. Organizations need to ensure that
members have appropriate IT tools for knowledge sharing (Casimir et al., 2012) and
knowledge storage ( Jasimuddin and Zhang, 2011). Integrated information systems allow
organizations to provide decision makers with relevant information at the moment it is Using
needed (Bharadwaj et al., 2007). The literature on IT contains numerous references to the information
role it plays in supporting the knowledge integration process in organizations. Specifically, technology
several studies mention that certain IT applications have been shown to be especially useful
in supporting knowledge integration processes in organizations (Fayard and DeSanctis,
2005; Khalifaa and Liub, 2008). Consistent with the previous arguments, this study proposes
the following hypothesis: 25
H2. IT use is positively related to the knowledge integration capability.

2.3 Organizational knowledge and management innovation

Management innovation has been linked, from both conceptual and empirical perspectives,
to positive outcomes in companies (Černe et al., 2013; Hamel, 2006; Walker et al., 2011).
Damanpour and Aravind (2012, p. 12) defined it as “new approaches in knowledge for
performing the work of management and new processes that produce changes in the
organization’s strategy, structure, administrative processes, and systems.” Based on these
arguments, it is important to find out what can predict or facilitate management innovation.
The term management innovation was introduced in a study by Golightly (1967) about
management changes in the airline sector. Other authors have referred to this concept,
alternatively calling it organizational innovation (Daft, 1978; Tether and Tajar, 2008) or
administrative innovation (Damanpour, 1987). As occurred in the research on technological
innovation, in the field of management innovation, scholars have differentiated between
development and implementation processes (Lam, 2005). On the one hand, studies such as
the one carried out by Birkinshaw et al. (2008) focus on the developmental process of
management innovation, where they identified up to five phases. On the other hand, studies
such as those by Mol and Birkinshaw (2009) and Vaccaro et al. (2012) focus on the
implementation process and its effects on organizational outcomes.
Management innovation can be considered a social construct that largely depends on
collaboration and sharing information and knowledge (Hage and Hollingsworth, 2000; Liao
et al., 2007; Taylor and Greve, 2006). The studies by Mol and Birkinshaw (2009) examine
how the existence of internal knowledge sources correlates with management innovation.
Firms have greater opportunities to increase their degree of innovation when they are
capable of spreading and taking advantage of their organizational knowledge (Mothe and
Nguyen-Thi, 2010). Therefore, this paper proposes the following hypothesis:
H3. Organizational knowledge positively affects the introduction of management innovation.

2.4 Knowledge Integration capability and management innovation

The different types of knowledge that employees have can become a valuable resource
when the company is capable of integrating them. An important part of integrating
knowledge is internal communication, which can be more complex in larger organizations,
impeding knowledge integration and its influence on its correlates, in this case, management
innovation (Mol and Birkinshaw, 2009; Walker et al., 2011). Greater connectivity among
employees gives rise to higher levels of trust and cooperation. This output would allow
managers to develop more managerial innovations, better understand the business and
have more information with which to synthesize new ideas ( Jansen et al., 2006). The degree
of integration capability is largely determined by the employees’ motivation and skill in
doing so (Collins and Smith, 2006). Knowledge integration capabilities create a shared vision
of the organizational context of the firm, making it possible to transfer and synthesize tacit
internal and external knowledge (Cummings, 2004). Therefore, integration capability favors
the transformation of diverse knowledge into a new form of integrated and novel
ARLA knowledge, favoring the innovative activity (Salazar et al., 2012). Based on these arguments,
32,1 this paper formulates the following hypothesis:
H4. Knowledge integration capability is positively related to management innovation.
Figure 1 shows the theoretical model tested in the present study.

26 3. Methodology
3.1 Sample
The methodological procedure consisted of a cross-sectional survey using a
self-administered questionnaire. In order to choose appropriate respondents in coherence
with the hypothesis to be contrasted, it was considered that the proposed model should be
tested in a single industry to avoid bias due to heterogeneity among respondents working in
different industries. Another criterion was that companies within the industry should have a
considerable weight in the national economy to make the results more robust. With these
premises in mind, the tourist hotel lodging industry emerged as a candidate to test the
model. The tourist hotel lodging industry is made up of a set of homogenous companies in
terms of the nature of their production and competitive environment (Martínez-Ros and
Orfila-Sintes, 2009). In addition, its economic importance contributes to further
extrapolating the outputs of the tested relationships (Ordanini and Parasuraman, 2011).
Furthermore, the geographical setting for our analysis is also solid, given that Spain is the
second tourist destination in Europe and the third worldwide, with a total of 68m visitors in
2015 (World Tourism Organization, 2016).
The target population consists of tourist hotel lodging firms with a staff of 50 employees
or more that operate establishments with three or more stars in the Spanish territory. The
reason for selecting only hotels that run establishments with three or more stars is that they
are more suitable for testing the proposed model. Firms that manage higher category hotels
present greater professionalization and are concerned with implementing innovation
activities in order to maintain a level of quality that allows them to continue in their
category (Pikkemaat and Peters, 2005). Moreover, companies with less than 50 employees
were excluded from the population to eliminate the possibility of including very small
organizations that do not have formal information systems.
The data for the hospitality firms were obtained from the 2011 Hostelmarket Annual
Report on hotels, restaurants, tourism and leisure. After refining the information in the

OK_1 OK_2 OK_3 OK_4

MI_1 MI_2 MI_3 MI_4

Organizational
knowledge
IT_1 H1 H3

IT_2 Information Management

technology innovation

IT_4 H2 H4
Knowledge
integration
capability

Figure 1.
Proposed model Control variable:
IC_2 IC_3 IC_4 IC_5 Firm Size
database, the final population was composed of a total of 523 firms. In this study, the Using
decision was made to study all of the sampling units by sending the questionnaire to all of information
the companies that made up the population. technology
The data collection process was carried out between September 2011 and March 2012.
During this period, companies in the population were contacted up to six times both by
e-mail (four messages) and by normal post (two notices). The questionnaire was directed to
general managers of the firms that made up the population. When the data collection 27
process ended, a total of 112 questionnaires had been received, of which 109 were considered
valid. This corresponds to a response rate of 20.8 percent. The professional and
demographic variables contained in the questionnaire show that the majority of the people
surveyed perform general management functions and have at least ten years of experience
in the company and a high education level.

3.2 Measures
The phase of selecting the items and scales began with an exhaustive literature review that made
it possible to identify the different existing measurement instruments related to the proposed
research model. These measures were submitted to a pre-test with five professionals from the
sector being studied, in order to guarantee that all respondents understood the questionnaire
correctly. All the variables were measured using Likert-type scales. Informants were asked to
indicate their degree of agreement with the items on a scale ranging from 1 ¼ completely
disagree to 7 ¼ completely agree (Table AI). IT system use was measured by adapting the scale
proposed by Youndt and Snell (2004). The purpose of this scale is to reflect the existence of
adequate technological infrastructures that favor, in theory, the exchange, transfer and collection
of knowledge dispersed throughout the organization. To measure organizational knowledge, we
adapted the scale developed by Akgün et al. (2008), which refers to the degree of knowledge and
experience related to the organization’s specific routines, processes and activities. The scale to
measure knowledge integration capability was adapted from the study by Pavlou and El Sawy
(2011), and it is designed to measure the company’s capacity to integrate individual knowledge in
a collective system. Finally, management innovation was measured on the basis of the
established in the Oslo Manual (OECD/Eurostat, 2005).
This study statistically controlled the effect of firm size, measured by means of
the logarithmic transformation of the number of employees. There is no consensus in the
literature about the relationship between firm size and management innovation. Some
authors suggest that the limited flexibility that characterizes large companies can keep them
from adopting new management practices (Wu, 2010; Vaccaro, 2010). However, Mol and
Birkinshaw (2009) argued that large companies are more likely to introduce new
organizational practices, given that they have more resources, including knowledge about
management practices and processes. The study by Kimberly and Evanisko (1981) showed
that firm size is positively associated with organizational innovation. Moreover, Volberda
et al. (2013) pointed out that large firms have been shown to be more ingenious than small
ones, but their need to introduce management innovations is also greater. Specifically, the
study by Orfila-Sintes and Mattsson (2009) finds that firm size is positively related to the
introduction of management innovations in hospitality companies. Therefore, we expect to
find a positive relationship between firm size and management innovation.

4. Analysis and results

An exploratory factorial analysis, carried out in a phase prior to confirmatory factorial
analysis, showed the existence of only one dimension in the scales used to measure the
latent constructs. Moreover, these scales have shown acceptable psychometric properties
(Table AI). Their reliability was evaluated with the Cronbach’s α coefficient and by
calculating the composite reliability and the average variance extracted (AVE). In all cases,
ARLA the Cronbach’s α and composite reliability values exceeded the minimum value considered
32,1 reliable (0.7). The AVE also exceeded, on all the scales, the recommended threshold of 0.5.
Likewise, the convergent validity of the scales was tested, given that all the standardized
estimators of the regression weights of the latent variable on the indicators are statistically
significant, positive and above 0.5. Finally, discriminant validity was evaluated by verifying
that the extracted variance of each construct is greater than the squared correlation between
28 two constructs (Fornell and Larcker, 1981). To simplify the procedure, the square root of the
AVE of each construct was calculated. As shown in Table I, all of the constructs have the
property of discriminant validity.
To test the proposed hypotheses, structural equation models were used as the analytical
methodology, employing AMOS 21. Different indices were used to evaluate model fit. The χ2
verisimilitude ratio (CMIN) is a measure of joint fit that makes it possible to test the hypothesis
that there are no significant differences between the observed matrix and the one reproduced by
the model. The generally recommended minimum acceptable significance level ( p-value) is 0.05.
The root mean square error of approximation must present values of less than 0.08, and it is
considered optimal when its values are of less than 0.05 (Lévy and Oubiña, 2006). The
Tucker–Lewis, normal fit and comparative fit indexes are measures that range between 0 (no fit)
and 1 (perfect fit), and it is recommended that they reach values above 0.9 (Hair et al., 1999).
The χ2 ratio divided by the degrees of freedom (CMIN/df) is considered adequate for values of
less than 2. Finally, the Akaike information criteria penalizes model complexity, so that the
lower its value, the better the fit, and the model will not be over-identified (Akaike, 1974).
Four structural equation models were developed to test the hypothesized relationships.
Model 1 corresponds to the proposed structural model, that is, the model in which
organizational knowledge and integration capability mediate the relationship between IT
use and management innovation. The results of this model indicate that the proposed
relationships are positive and significant, although the model does not present a good fit to
the data. Moreover, it is observed that the relationship between organizational knowledge
and management innovation presents the lowest estimator of the relationships in this model
( β: 0.23; po 0.05). Likewise, this estimator was shown to increase considerably when the
relationship between integration capability and management innovation was eliminated,
which suggests the possible existence of a mediator effect. Based on these results, in Model
2, the direct relationship between organizational knowledge and management innovation
was eliminated, evaluating the indirect influence, through integration capability, of
organizational knowledge on management innovation. Results confirm that organizational
knowledge is positively and significantly related to the integration capability ( β: 0.52;
p o0.001). In addition, Model 3 analyzed the possible direct effect of IT use on management
innovation. The data show that this effect is positive and significant ( β: 0.24; p o0.05).
Finally, Model 4 includes all the relationships mentioned above, and results confirm that
there is no significant relationship between organizational knowledge and management
innovation. Table II shows the goodness of fit of the different models evaluated. As can be

(1) (2) (3) (4) (5)

(1) Information technology (0.864)

(2) Organizational knowledge 0.661 (0.895)
(3) Knowledge integration capability 0.675 0.737 (0.863)
(4) Management innovation 0.598 0.526 0.648 (0.851)
Table I. (5) Firm size 0.192 0.127 0.130 0.318 n/a
Correlations and Notes: n/a, not applicable. aThe elements on the diagonal (values in parentheses) correspond to the square
discriminant validitya root of the extracted variance of the construct
observed, Model 3 presents the best fit to the data and, therefore, was used to explain the Using
relationships between the variables analyzed. This emergent model (Figure 2) is capable of information
explaining 48 percent of the variance in management innovation. technology
As shown in Figure 2, the data reveal that the use of IT is positively and significantly
related to both organizational knowledge and integration capability. Therefore, H1 and H2
are supported. In addition, the data show a positive and significant effect of integration
capability on management innovation, and so H4 is also supported. However, there is no 29
empirical evidence for the direct relationship between organizational knowledge and
management innovation (H3), although there is an indirect effect through integration
capability. In order to evaluate the role of the control variable, it was included in the
model as an exogenous variable that could affect the dependent variable. The data show
that firm size presents a positive and significant relationship with management innovation
( β: 0.21; p o0.01).

5. Discussion and conclusions

The purpose of this paper was to empirically evaluate how IT use facilitates the introduction
of management innovation through the mediator role of two knowledge resources:
organizational knowledge and knowledge integration capability. The results show that the
use of IT tools favors the development of organizational knowledge and the ability to integrate
this knowledge. Numerous IT tools can be used to support knowledge management in
hospitality organizations, including databases, online search systems, expert networks,
groupware, teleconferences, intranet(s), videoconferences, e-mail, document management
systems, data warehouse systems and workflow software (Okumus, 2013b). Currently, IT, in
addition to building a necessary infrastructure to manage knowledge, has become an element
that favors a high degree of interaction among individuals, departments and areas of the firm.
Therefore, it seems reasonable to assume that when firms foment and facilitate the use of
these technologies at all levels of the organization, they are favoring the exchange of
information among individuals with different degrees and types of knowledge and,

CMIN df p-value RMSEA TLI NFI CFI CMIN/DF AIC

Model 1 130.0 85 0.001 0.070 0.961 0.916 0.969 1.530 230.0

Model 2 109.0 85 0.041 0.051 0.979 0.929 0.983 1.283 209.0 Table II.
Model 3 105.1 84 0.059 0.048 0.982 0.932 0.985 1.251 207.1 Goodness of fit of the
Model 4 104.0 83 0.059 0.048 0.981 0.932 0.985 1.253 208.0 structural models

0.24

Organizational
knowledge
0.66 R 2: 0.48

Information Management
0.52
technology innovation

0.33
Knowledge 0.51
integration Figure 2.
capability Emergent model
ARLA consequently, the development of organizational knowledge. Moreover, IT use allows
32,1 individual knowledge to become a collective and integrated system.
The data show, furthermore, that the integration capability favors the introduction of
management innovation. The literature points out that management innovation is a process
that results from the way different individuals think, interpret, act or interact (McCabe,
2000; Mothe and Nguyen-Thi, 2013). Therefore, it must be considered as a product of a
30 supra-individual action, where it is fundamental to integrate the knowledge of different
individuals within the organization.
In contrast to what was hypothesized, organizational knowledge does not have a direct
influence on management innovation, although it does have an indirect effect. This result can be
explained by the fact that the mere presence of expertise, as well as the diversity and complexity
of organizational knowledge, does not necessarily have an influence on management innovation,
but it does when it is socially integrated (Vaccaro, 2010; Maurer et al., 2011).
In addition, the results show two non-hypothesized relationships that present theoretical
rationality. On the one hand, organizational knowledge determines the integration capability; on
the other, the use of IT has, in addition to the indirect effect, a direct influence on management
innovation. The relationship between organizational knowledge and integration capability is
consistent with a trend of the resource-based view represented by authors such as Ketchen et al.
(2007), Wang et al. (2009) and Wei and Wang (2011). These authors state that, although certain
resources are vital for obtaining competitive advantages, they do not directly influence the
organizational results. In agreement with these proposals, valuable resources allow companies to
perform better strategic actions that can ultimately improve organizational performance.
Following this line of research, the findings of the study seem to show that performance is
basically explained by what the company is capable of doing with its set of resources, rather than
by the stock of resources it has. Specifically, it shows that organizational knowledge influences
management innovation because it favors the company’s ability to develop its integration
capability. The direct significant relationship between IT use and management innovation is
consistent with results found by other researchers. McDermott (1999) presented the view of IT as
the means to generate a global knowledge that would lead to higher levels of effectiveness and
efficiency. More recently, Haragdon (2008), King (2006), Standing and Kiniti (2011) and Wagner
(2004) reported examples of IT applications with direct effects on managerial innovations.

6. Implications
This study makes a contribution to the growing body of literature on management
innovation. From an academic perspective, it makes the novel contribution of clarifying the
way in which IT use contributes to achieving competitive advantages in organizations. The
bibliography on the incidence of IT in obtaining competitive advantages is extensive, but it
lacks empirical support to explain how this relationship is produced. This study could
contribute to reducing this gap by showing that IT use, both directly and through its role as
a facilitator of knowledge integration, positively contributes to developing management
innovations. This intermediate step is supported by findings from numerous studies
showing that management innovation is a source of competitive advantage. Furthermore,
the results show that the relationship between IT development in service firms and
management innovation performance is more strongly pronounced when the company has a
greater knowledge integration capability of its organizational knowledge.
Novel practical implications can be drawn from this study on management innovation
for service companies and, more specifically, for hospitality firms. It shows a clear path
between the need to justify IT investments and the achievement of management innovation.
From the perspective of the link between IT use and knowledge management, previous
research revealed that a number of IT tools can be used to support knowledge management.
Okumus (2013b) cited database systems and groupware, among others; Sher and Lee (2004)
justified the validity of ERP systems, e-mail and online knowledge search technologies; and Using
Gronau (2002) showed the usefulness of document management systems and other information
communication and retrieval tools. The tendency has traditionally been that investing in IT technology
only makes sense in knowledge-intensive services companies, relegating IT to a secondary
role in non-knowledge-intensive services companies. The findings from this study
contradict this prejudice, showing that IT can assist in integrating knowledge, thus leading
to management innovations. In addition, when IT facilitates information access and 31
exchange, it is in itself an engine that drives the development of management innovations.
In addition, the study suggests that, by investing in IT development and use, hotel
companies can reach higher levels of basic skills in performing organizational tasks and
activities (organizational knowledge). The results found in this study shed light on the direct
and indirect relationship between IT use and management innovation, which indicates the
potential of developing this technology in hotel firms. As a final step, the positive
relationship established in the literature between management innovation and superior firm
performance (Camison and Villar-Lopez, 2014; Damanpour and Aravind, 2012; Ganter and
Hecker, 2013) provides strong backing for managers of these types of companies who want
to obtain support from their boards of directors to increase the levels of investment in IT
tools that can facilitate knowledge management practices.

7. Limitations
In evaluating the contributions of this study, it is important to take into account some
limitations that can lead to future lines of research. One limitation is related to the scale used to
measure IT use, given that, although it was based on the scale proposed by Youndt and Snell
(2004), the questionnaire has a general nature and does not mention technologies that are
specifically useful for knowledge management. The large number of tools that would have to
be included in the questionnaire to reflect the entire range of technologies that can contribute
to better knowledge management practices in hospitality organizations would make it
unwieldy and difficult for its target population, mainly general managers of hotel firms, to
complete. Therefore, the questions in the IT sections were worded in a general fashion.
However, because the overall questionnaire was designed to respond to different questions
related to knowledge management and management innovation, it was considered that the
questions in this section would be interpreted within the general context of the questionnaire.
The results from the pre-test of the questionnaire applied to five hotel firm managers support
this idea. A second limitation is related to the use of the key informant technique, although an
attempt was made to mitigate the possible perceptual bias by assuring, to some degree,
the reliability of the responses. Thus, the informants have considerable experience in both the
sector and the company, and they occupy positions of responsibility, allowing them a more
global vision of the organization. Moreover, the management innovation measurement
scale was developed based on what is presented in the third edition of the Oslo Manual
(OECD/Eurostat, 2005), where this type of innovation is included for the first time. The
Manual expressly states that this is a new concept of an experimental nature, although it has
been successfully tested in other countries. Future editions of the Oslo Manual, in addition to
emergent research about the concept of management innovation, can refine the measurement
scale for this type of innovation. Another limitation of the study is related to generalizing the
conclusions. The services sector is made up of a set of activities with quite different
characteristics, and this reduces the possibility of generalizing the results obtained. However,
we can extrapolate the results to the setting of the population under study; that is, companies
dedicated to operating hotel establishments with more than 50 employees and at least three
stars. Therefore, it would be interesting to apply the model in other services firms and carry
out comparative studies among them. Finally, although the indices show that the model fits
the data well, the ideal sample size should be somewhat larger when testing SEM models.
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ARLA Appendix
32,1

Factor Std.
Itema loading λx

38 Information technology (Cronbach’s α ¼ 0.903; composite reliability ¼ 0.898; AVE ¼ 0.746)

IT_1: our information systems are easy to use 0.858 0.876
IT_2: our information systems are integrated (they can interconnect appropriately) 0.917 0.899
IT_3: our information systems are accessible to all employees* 0.871 –
IT_4: our information systems are appropriate to enable employees to exchange 0.911 0.814
information and knowledge
Organizational knowledge (Cronbach’s α ¼ 0.939; composite reliability ¼ 0.942; AVE ¼ 0.802)
OK_1: employees are highly knowledgeable about how the various processes (e.g. food and 0.918 0.881
beverage, accommodation, marketing, cleaning) and activities (e.g. cooking, arrivals
management, communication, laundry) are performed
OK_2: employees are highly experienced in relation to how processes and activities 0.937 0.926
are performed
OK_3: employees of this company are very familiar with the processes and activities they 0.948 0.950
carry out
OK_4: we have well established routines and procedures for performing processes and 0.884 0.819
activities
Knowledge integration capability (Cronbach’s α ¼ 0.919; composite reliability ¼ 0.921; AVE ¼ 0.745)
IC_1: employees’ individual contributions are channeled through their 0.845 –
work group*
IC_2: members of the firm have a global understanding of the tasks and responsibilities of 0.858 0.810
the other members
IC_3: we are fully aware of who in the firm has specialized skills and knowledge relevant to 0.837 0.780
our work
IC_4: we carefully interrelate actions between members of the firm to meet 0.926 0.929
changing conditions
IC_5: members of the firm manage to successfully interconnect their activities 0.930 0.924
Management innovation (Cronbach’s α ¼ 0.875; composite reliability ¼ 0.913; Average variance extracted
¼ 0.725)
MI_1: we frequently introduce organizational changes to improve the division of 0.907 0.885
responsibilities and decision making (e.g. decentralization, department
restructuring, etc.)
MI_2: we frequently introduce new methods for managing external relationships with 0.897 0.859
other firms or public institutions (e.g. new alliances, new forms of cooperation, etc.)
MI_3: we often introduce new practices in work organization or firm procedures (e.g. new 0.902 0.873
quality management practices, new information and knowledge management
systems, etc.)
Table AI.
Exploratory and MI _4: the new organizational methods we have incorporated have been pioneering 0.855 0.785
confirmatory factor in the sector
analyses Notes: aTo fit the measurement model, two items was dropped. These are marked with*

About the authors

Julia Nieves, PhD in Business Administration, is Assistant Professor at the University of Las Palmas
de Gran Canaria. She has combined her teaching work with her professional activity in the financial
and the audit sector. Her research focuses on knowledge strategic management and innovation in
services with particular emphasis on hospitality industry. She has published in journals such as
Tourism Management, International Journal of Hospitality Management and International Journal of Using
Contemporary Hospitality Management. Julia Nieves is the corresponding author and can be contacted information
at: julia.nieves@ulpgc.es
Javier Osorio, PhD in Business Administration, is Associate Professor at the University of Las technology
Palmas de Gran Canaria. He has worked as Organizational Advisor for private and governmental
bodies. His research has focused on information systems management, strategic planning and
innovation in organizations. He has published in journals such as International Journal of Hospitality
Management and Knowledge Management Research and Practice. 39

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