A change of leadership is one of the most significant moments in the life of any business. In tourism and hospitality it often comes at the same time as a change of ownership, when a founder retires, a family hands over to the next generation or a business is sold. Much of the discussion around succession focuses on continuity: keeping the business running, protecting its reputation and holding on to staff and guests. These are essential. However, new research from EHL Hospitality Business School suggests that a change of leadership can also be one of the best opportunities a business will have to renew itself.
Why innovation matters in hospitality
Hospitality businesses face pressure from several directions at once. Guest expectations keep changing, digital tools are reshaping how businesses market themselves and manage bookings, sustainability is becoming a requirement rather than an option, and recruiting and keeping good staff remains a constant challenge. Poretti and Ducrey argue that in this environment, innovation is no longer just a way to stand out. It is a survival strategy.
Innovation in hospitality is often subtle. It rarely means a single dramatic invention. More often it involves gradual changes to the service model, the guest experience, the way the team works or the use of digital systems. This makes it hard to identify what drives it. The EHL research set out to answer one specific question: does a change of leadership lead a business to change direction and innovate, and if so, under what conditions?
About the research
The researchers studied 70 publicly listed hospitality companies in the United States and the United Kingdom over a ten-year period, covering 620 years of company data. Using statistical methods designed to isolate the effect of a change of chief executive, they examined how the strategic direction of each company shifted after a new leader took over.
These are large, listed companies, so their circumstances differ from those of a family guesthouse or a small restaurant. Even so, the findings point to patterns that are highly relevant to smaller tourism businesses going through succession.
Finding 1: Leadership change is a turning point for strategy
The study describes leadership transitions as strategic turning points. When a new leader takes over, there is a natural moment to review what the business does, question established habits and set a new direction. Businesses that use this moment well can renew themselves. Those that treat the handover purely as a matter of keeping things as they were may miss the opportunity.
What this means for tourism SMEs: succession planning should not only ask “how do we keep the business running?” but also “what should the business look like in ten years?” The years before and after a handover are an ideal time to review the offer, the guest experience, the use of technology and the approach to sustainability.
Finding 2: Outside successors tend to drive more change
The researchers found that businesses shifted their strategy more strongly when the new leader came from outside the organisation. External leaders are less bound by established norms and more willing to question how things have always been done. Successors from inside the business tend to favour continuity, which can limit the scope for significant change.
What this means for tourism SMEs: this finding is a useful counterweight to the common assumption that a family member or long-serving employee is always the best successor. Internal successors bring valuable knowledge, relationships and trust, and continuity is often exactly what a business needs. However, families and owners should be aware that an internal successor may find it harder to make changes, particularly while the previous owner is still close by.
There are ways to bring an outside perspective into an internal succession:
Equally, where there is no family successor, a sale to an external buyer should not be seen only as a last resort. It may bring fresh ideas and renewed energy to the business.
Finding 3: Experience matters more than age
It is often assumed that younger leaders are more willing to take risks and innovate. The EHL findings suggest the opposite in hospitality. Older chief executives, with deeper industry experience and practical knowledge of operations, were more likely to pursue innovation after taking over. The researchers conclude that age does not hold back innovation, and that experienced leadership is especially valuable in complex, service-based businesses.
What this means for tourism SMEs: a successor’s readiness depends far more on knowledge and experience than on age. This supports the case for preparing successors thoroughly, through work experience across different parts of the business, training and time spent learning from others in the sector. It also means that a mid-career buyer or manager with strong hospitality experience can be an excellent choice to lead a business into its next stage.
Finding 4: Family ownership supports renewal
Family-owned companies were noticeably more likely to innovate after a change of leadership. The researchers link this to the long-term outlook and flexibility typical of family businesses, which gives a new leader room to set a new direction. In contrast, companies owned mainly by large institutional investors showed weaker innovation after a leadership change, as their tighter governance tends to favour stability over experimentation.
What this means for tourism SMEs: this is encouraging news for the many family-run tourism businesses across Europe. Their long-term perspective is a real strength during succession. To make the most of it, the outgoing generation needs to give the new leader genuine room to make decisions. A successor who is formally in charge but unable to change anything will struggle to renew the business.
Finding 5: Women remain underrepresented in leadership
The study found that the gender of the chief executive did not significantly affect the link between leadership change and innovation. The more striking finding concerned representation. Of the 620 years of company data, only 37 involved a female chief executive, and only 9 of the 70 companies had ever appointed a woman to the role. The authors highlight this as a wider diversity and inclusion issue for the industry.
What this means for tourism SMEs: succession is an important moment to consider who is being prepared for leadership, and who may be overlooked. In family businesses, assumptions about which son or daughter will take over are often made early and rarely questioned. Open conversations about succession should include all potential successors, and recruitment of external candidates should draw on the widest possible pool of talent.
Recommendations from the research
Poretti and Ducrey offer several recommendations for business owners and boards:
Questions for owners and successors
The research suggests some useful questions to discuss when planning a handover:
Continuity and renewal together
A successful succession balances two needs: protecting what makes the business valuable, and creating space for the changes that will keep it relevant. The EHL research is a reminder that a leadership change, handled well, is not only a risk to be managed but an opportunity to be used.
Further support from NextGEN Tourism
The NextGEN Tourism training modules explore these themes in depth. Module 2, Ensuring the Business Is Transfer Ready, covers strategic direction, sustainability and business renewal. Module 4, Leadership Transition and Business Continuity, covers successor development and leadership handover. Module 5, Family, Teams and Stakeholder Relationships, covers the family and team side of succession. The Tourism Succession Readiness Assessment helps owners and successors identify where to begin.
Source: Poretti, C. and Ducrey, H., “Leadership Change as a Catalyst for Innovation in Hospitality”, Hospitality Net, 28 November 2025.
This article is based on “Leadership Change as a Catalyst for Innovation in Hospitality” by Cédric Poretti, Assistant Professor of Accounting at EHL Hospitality Business School, and Hélène Ducrey, EHL alumna. It was published on Hospitality Net on 28 November 2025. Their research findings have been summarised and adapted for small and medium-sized tourism businesses by the NextGEN Tourism partnership. The original article is available at hospitalitynet.org.