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Achieving better performance and a sustainable competitive advantage is essential for survival in the hotel industry. However, literature is scarce on which factors local hotel businesses in developing countries should rely on to compete successfully. With an emerging economy and significant potential for growth in the travel and hospitality sectors, Colombia is seeking to improve the performance of its hotel industry. To achieve this goal, exploring and analyzing the effects of the strategies and practices implemented is essential. Accordingly, this study investigates the dynamics of the interactions between strategies, process innovations, outsourcing practices and operational quality in the hotel industry in Colombia.

The methodology used in this research is quantitative, using structural equation modeling based on data collected from 150 valid questionnaires.

The strategies of the hotel sector have an impact on hotel performance. Although process innovation demonstrably affects quality and outsourcing, there is a low impact on the performance of the studied hotels. The hotel sector lacks strategy autonomy as strategies are not directed to the organization's overall improvement but only to satisfy stakeholders' requirements.

This paper offers valuable insights for organizations when implementing strategic innovation initiatives. It provides information relevant to Colombian government entities on the creation of processes, economic policy plans and business assistance programs for boosting the financial and commercial sustainability of Colombian service sector businesses. The studied organizations need to redefine the role of their strategies, process innovation, outsourcing projects and quality standards to achieve adequate performance, as all four dimensions together are required to foster competitiveness.

This paper offers valuable insights for organizations when implementing strategic innovation initiatives. Additionally, it provides information relevant to Colombian government entities on the creation of processes, economic policy plans and business assistance programs for boosting the financial and commercial sustainability of Colombian service sector businesses. The studied organizations need to redefine the role of their strategies, process innovation, outsourcing projects and quality standards to achieve adequate performance, as all four dimensions together are required to foster competitiveness.

Developing successful strategies is vital to generating performance. Quality and safety are critical strategies to achieve a sustainable competitive advantage. But literature is scarce on which factors local hotel businesses should rely on to compete successfully in developing countries. In particular, the concept of outsourcing in a highly distrusting developing country has not been addressed adequately. This research contributes to literature by evaluating quality as a competitive strategy in the hotel sector in a developing country to achieve a superior performance.