Bridging old and new: how AI literacy and frugal innovation enable family-owned boutique hotels to transform Industry 4.0 into innovation performance
Purpose How can family-owned boutique hotels (F-OBHs) preserve their uniqueness and embrace cutting-edge technology? This study aims to examine a research gap, how Industry 4.0 (I-4.0) capabilities drive sustainable innovation performance (SIP) through frugal innovation. It is also investigated how AI problem-solving and digital literacy influence these conscious enterprises without losing their authentic character. Design/methodology/approach Primary data were collected from 243 descendant entrepreneurs handling their F-OBHs. This data was analysed by using 2nd generation software, Smart-PLS and applied the PLS-SEM technique. Findings This study found that I-4.0 capabilities, AI problem-solving and AI literacy significantly boost SIP in F-OBHs. Frugal innovation strengthens I-4.0 capabilities with SIP. AI problem-solving abilities of F-OBHs maximize their I-4.0 capabilities and achieve excellent frugal innovation. Moreover, high AI literacy of entrepreneurs increases frugal innovation activities and achieves SIP. Originality/value This study unlocks how F-OBHs can compete against giants in their industry by using smart tech and slowly replacing established traditions cost-effectively. The findings show how F-OBHs can turn their everyday challenges into breakthrough opportunities in an increasingly digital marketplace.
Authors
- Tahira Iram (ORCID: https://orcid.org/0000-0003-3571-7987)
- Hina Iftikhar (ORCID: https://orcid.org/0000-0003-2138-1415)
- Norizah Mustamil
- Zeshan Ahmad
- Belal Mahmoud AlWadi
Institutions
- Al-Zaytoonah University of Jordan (JO)
- Duy Tan University (VN)
- University of Malaya (MY)
- EM Strasbourg Business School (FR)
- Universiti Teknologi MARA System (MY)
- Université de Strasbourg (FR)
Publication Details
- Journal
- Journal of Hospitality and Tourism Technology
- Published
- 2026-07-02
- DOI
- https://doi.org/10.1108/jhtt-06-2025-0461
- Primary Topic
- Family Business Performance and Succession
- Type
- article
- Field-Weighted Citation Impact
- 0.00