From Policy to Practice: Innovation Needs Better Bridges

Everyone in tourism talks about innovation. Governments publish strategies. Development agencies host workshops. Hotels launch digital platforms. But when you ask the average café owner, tour guide, or street vendor what innovation looks like to them, you'll often hear:

"We don't see it. We're just trying to keep up."

That's the disconnect. Not between ideas and outcomes, but between policy and practice.

A Lesson from the Field: Fiji as a Mirror

During my research in Fiji, our team studied the entrepreneurial landscape of micro and small enterprises (MSEs) in the Nadi and Denarau tourism corridor. We found something paradoxical:

• ●Innovation was a top-down buzzword.
• ●But MSEs operated in survival mode, isolated from the strategic direction of tourism.
• ●They lacked access to planning spaces, innovation incentives, or technical support.

One entrepreneur told us:

"We hear about tourism growth, but we don't see it."

Our final report noted that "stakeholder alignment and co-design were virtually absent in support programs." While systems existed on paper, they rarely reached the people they were meant to serve.

This isn't unique to Fiji. It's a structural issue and it plays out in Aruba, Sanur, and Barcelona too.

What the Theory Tells Us

Institutional Economics: Structure Shapes Opportunity

Douglass North (1990) emphasized that institutions, both formal (laws) and informal (norms), shape the rules of the game. They influence who gets to participate, who has access to resources, and what kinds of innovation are possible.

A more recent study by Altin et al. (2020) confirmed that regulations, such as tax systems and labor policies, significantly influence the birth and death rates of hospitality firms.

If institutions are too rigid, opaque, or exclusive, they constrain innovation rather than enable it.

Arnstein's Ladder of Participation (1969)

This classic model outlines how much influence communities or entrepreneurs actually have in shaping decisions:

• ●Informing: You're told what's going to happen.
• ●Consulting: You're asked for input, but it may not change anything.
• ●Co-Designing: You're helping make the decisions.

In many tourism systems, entrepreneurs are informed or consulted but rarely co-create.

Recent Research: Innovation Ecosystems Need Inclusion

• ●Kraff (2024) emphasizes that relational governance and co-creation are essential for truly inclusive tourism innovation.
• ●Power et al. (2020) show that regional clustering and proximity to complementary services significantly increase the survival of small tourism firms.
• ●UNWTO (2024) emphasizes that inclusive planning and simplified processes are key to resilient tourism.

Aruba: Strong Foundations, Gaps in Translation

Aruba has made real efforts to support small businesses:

• ●Qredits Aruba offers loans, business coaching, and the Small Business Academy.
• ●IDEA provides free workshops on business planning, marketing, and finance.
• ●Invest in Aruba (ARINA) has streamlined permitting and promotes key sectors.
• ●The Aruba Signature Experience (ASE) links entrepreneurs to the DMO narrative.

But these systems, while valuable, often:

• ●Focus more on business formalization than on creative, guest-facing innovation.
• ●Remain siloed, with little crosstalk between public programs, private operators, and entrepreneurs.
• ●Lack feedback mechanisms or micro-level co-creation channels.

We've built policy. But have we built pathways?

In Sanur, Bali, we saw a similar disconnect with policy documents emphasized cultural differentiation, but small service providers had no role in shaping that vision. Despite strong local character and a rich history, our Sanur report showed that destination development lacked clear mechanisms for bottom-up innovation, leaving business owners confused about who the strategy was for.

In Barcelona, I studied small businesses along Avinguda de Gaudí, strategically located between two tourism icons; Sagrada Familia and Hospital de Sant Pau. Yet these businesses were not connected to tourism planning or destination marketing. Despite location advantages, there was no support for shared storytelling, collaborative branding, or service innovation.

And in Melbourne, we observed the opposite: public-private partnerships allowed local micro-enterprises to co-design guest experiences in laneways, cultural districts, and seasonal activations. In fact, local government played a facilitation role, helping small businesses organize, pilot ideas, and benefit from joint marketing. It was a textbook example of policy translated into practice.

What's Missing: The Policy-to-Practice Bridge

Let's reframe the question:

Not "Do we support small businesses?" but "Can they see, feel, and act on that support?"

Here are five things Aruba and other island destinations could do to bridge the gap:

1. Innovation Navigators

Create a network of trained local advisors who help small businesses navigate permits, marketing opportunities, or access to grants.

• ●Justification: North's theory on institutional constraints points to the need for agents of access.

2. Co-Creation Labs

Host quarterly forums where MSEs, tourism officials, and planners sit together to prototype and improve guest experiences.

• ●Justification: Moves participation from consultation to co-design (Arnstein).
• ●Example: In Melbourne, small operators were part of co-creation councils, helping to design both policy and guest flow.

3. Rapid Innovation Permits

Simplify a temporary, low-risk permitting lane for piloting new experiences or pop-ups.

• ●Justification: Encourages experimentation; lowers transactional and institutional friction (Altin et al., 2020).

4. SME Seats on Tourism Boards

Include MSE representation in DMO and policy boards to ensure real stakeholder diversity.

• ●Justification: Relational governance improves innovation outcomes (Brouwer & Krause, 2023).

5. Feedback-to-Policy Loops

Create feedback sessions where entrepreneurs share pain points, and public agencies revise processes accordingly.

• ●Justification: Innovation requires iteration, and institutions need feedback like businesses do.

Building Better Systems

Innovation isn't just a mindset. It's a system. And systems require design.

In Aruba, we have the pieces:

• ●Entrepreneurial spirit
• ●Government commitment
• ●Tourism demand

But until we restructure how innovation flows, small businesses will remain busy trying to survive, instead of helping reinvent the guest experience.

Final Thought & Call to Action

We don't need more strategy papers. We need better bridges.

What's one process in Aruba's tourism system that could be simplified or made more collaborative for small businesses?

Let's build the tourism ecosystem from the ground up, together!

References

Alberts, G., Iglesias Carmona, D., Yuan, W. and Lacle, R., 2014. Exploring the Entrepreneurial Capacity to Innovate: Micro and Small Enterprises in Fiji. Breda: NHTV Breda University of Applied Sciences.

Alberts, G., Iglesias Carmona, D., Yuan, W. and Lacle, R., 2014. Unlocking the Chain to Effective Development: A Potential Future for Sanur as a Competitive Destination. Breda: NHTV Breda University of Applied Sciences.

Alberts, G., Iglesias Carmona, D., Yuan, W. and Lacle, R., 2014. What Matters? Public Organizations and Tourism Development in Melbourne. Breda: NHTV Breda University of Applied Sciences.

Lacle, R., 2015. The Importance of Supporting Entrepreneurship in Relation to the Development of a Micro Destination. Master's Thesis. Breda: NHTV Breda University of Applied Sciences.

Altin, M., Ridderstaat, J., de Larrea, G.L. and Köseoglu, M.A., 2020. Influence of institutional economics on firm birth and death. International Journal of Hospitality Management, 86, 102442.

Arnstein, S.R., 1969. A ladder of citizen participation. Journal of the American Institute of Planners, 35(4), pp.216–224.

Brouwer, J. and Krause, D., 2023. Relational Governance and Inclusive Innovation in Island Tourism. Tourism Planning & Development, 20(2), pp.101–119.

Kraff, H., 2024. Political and relational co-creation for inclusive tourism. Journal of Sustainable Tourism.

North, D.C., 1990. Institutions, Institutional Change and Economic Performance. Cambridge University Press.

Power, B., Doran, J. and Ryan, G., 2020. Spatial effects in regional tourism firm births and deaths. Regional Studies.

UNWTO, 2024. Inclusive Recovery and Innovation in Tourism SMEs. World Tourism Organization.