Contemporary Destination Governance: A Case Study

Approach
Tisens/Tesimo
Article information:
To cite this document: "Tisens/Tesimo" In Contemporary Destination Governance: A
Case Study Approach. Published online: 09 Apr 2015; 121-133.
Permanent link to this document:
https://doi.org/10.1108/S2042-144320140000006027
Downloaded by New York University At 08:17 14 April 2019 (PT)

Downloaded on: 14 April 2019, At: 08:17 (PT)

References: this document contains references to 0 other documents.
To copy this document: permissions@emeraldinsight.com
The fulltext of this document has been downloaded 49 times since 2015*
Users who downloaded this article also downloaded:
(2015),"Naturns/Naturno", Bridging Tourism Theory and Practice, Vol. 6 pp. 135-147 <a
href="https://doi.org/10.1108/S2042-144320140000006029">https://doi.org/10.1108/
S2042-144320140000006029</a>
(2015),"Passeiertal/Val Passiria", Bridging Tourism Theory and Practice, Vol. 6 pp.
149-159 <a href="https://doi.org/10.1108/S2042-144320140000006030">https://
doi.org/10.1108/S2042-144320140000006030</a>

Access to this document was granted through an Emerald subscription provided by

emerald-srm:198285 []
For Authors
If you would like to write for this, or any other Emerald publication, then please
use our Emerald for Authors service information about how to choose which
publication to write for and submission guidelines are available for all. Please visit
www.emeraldinsight.com/authors for more information.
About Emerald www.emeraldinsight.com
Emerald is a global publisher linking research and practice to the benefit of society.
The company manages a portfolio of more than 290 journals and over 2,350 books
and book series volumes, as well as providing an extensive range of online products
and additional customer resources and services.
Emerald is both COUNTER 4 and TRANSFER compliant. The organization is a partner
of the Committee on Publication Ethics (COPE) and also works with Portico and the
LOCKSS initiative for digital archive preservation.

*Related content and download information correct at time of download.

 Case 10

TISENS/TESIMO

Abstract: The case of Tisens/Tesimo illustrates the critical role of gov-

ernance in the course of a destination life cycle. In particular, it exem-
plifies how improving the effectiveness and efficiency of destination
Downloaded by New York University At 08:17 14 April 2019 (PT)

governance has the potential to relaunch stagnating or declining desti-

nations. First, Tisens/Tesimo has managed to improve its effectiveness
by developing a common strategy in a participatory manner. Second,
improving efficiency in networking through an increase in trust also
seems to have supported the process of recovery. However, the chal-
lenge is to establish cost-efficient collaboration while maintaining the
dynamic and adaptive capacity associated with low levels of centraliza-
tion. In achieving this balance, the destination raises issues about colla-
borative efficiency. Keywords: Tisens/Tesimo, rejuvenation, change
corridor, collaborative efficiency

INTRODUCTION

During the course of their development, destinations pass through different

stages. Butler (1980) identifies a life cycle of destination development and
divides it into seven stages: exploration, involvement, development, consoli-
dation, stagnation, decline, and (possibly) rejuvenation. He argues that each
of these stages has its own special characteristics. However, from a manage-
ment perspective, the processes that drive change and facilitate the transition
between the phases are of special importance (Garay & Cànoves, 2011;

Contemporary Destination Governance: A Case Study Approach

Bridging Tourism Theory and Practice, Volume 6, 121 133
Copyright r 2015 by Emerald Group Publishing Limited
All rights of reproduction in any form reserved
ISSN: 2042-1443/doi:10.1108/S2042-144320140000006027
 122 Contemporary Destination Governance

Keller & Bieger, 2010; Kozak & Martin, 2012). This particularly applies
to the situation in which a traditional destination has reached a point of
saturation and is in search of rejuvenation strategies. Building on previous
works on destination life cycle (Beritelli, 1997; Butler, 1980, 2006a, 2006b;
Johnston, 2006), Pechlaner, Reuter, and Bachinger (2010b) identify the
creation of a network and the realization of positive networking effects as
critical factors to promote destination development in the initial stage. They
call the timeframe in which this fundamental transition from pretourism era
(a region) to tourism era (a destination) occurs a “change corridor.”
Obviously, the transition from decline to rejuvenation is another period in
the life cycle that requires profound changes.
Downloaded by New York University At 08:17 14 April 2019 (PT)

The case of Tisens/Tesimo provides some clues about how the critical
factors of effective and efficient networking in the first change corridor
could also be decisive features in the rejuvenation process. Pechlaner et al.
(2010b) specify that two preconditions for the realization of positive net-
work effects are the identification of resources and the establishment of a
common strategy—in the sense of common product market combinations.
Once these preliminary conditions are satisfied, “the implementation of
growth strategies depends on governance mechanisms within the destina-
tion” (Pechlaner, Herntrei, & Kofink, 2009, p. 303). Consequently, strategic
product development (i.e., making the best usage of resources and compe-
tencies) in order to create customer value (Bieger, 2000; Pechlaner et al.,
2009) is intrinsically linked to destination governance issues.
The case of Tisens/Tesimo illustrates the critical role played of govern-
ance in the course of a destination life cycle. The life cycle pattern of Tisens/
Tesimo is characterized by a steady growth period throughout the 1970s and
1980s, followed by stagnation in the early 1990s, decline after 1995, and a
recovery—perhaps indicating a rejuvenation—in very recent years. Given
that some of the most basic resources for sustainable success as a destination
were always present in the region (i.e., rich natural and cultural features and
a high degree of hospitality in the local population), the decrease during the
years before the turnaround in 2008 09 can, to a considerable extent, be
attributed to the nonoptimal deployment of these resources. This insufficient
leveraging of resources can be organized into the effect categories of subop-
timal effectiveness and efficiency. Both concepts are closely connected with
the idea of destination governance (Pechlaner, Volgger, & Herntrei, 2012;
Ruhanen, Scott, Richie, & Tkaczynski, 2010) and constitute anchor points
for a sustained relaunch of the destination. However, they may also involve
some trade-offs, which the concept of collaborative efficiency (Sabel, 2007)
tries to deal with.
 Tisens/Tesimo 123

DESTINATION GOVERNANCE IN CHANGE CORRIDORS

With a population of approximately 1,880, Tisens/Tesimo is a small munici-

pality in South Tyrol situated in the lower mountains on a high plateau
between the regional capital Bozen/Bolzano and the famous spa town
Meran/Merano (ASTAT, 2011a) (Figure 1). The economic system is strongly
linked to tourism, with approximately one-third of the employed population
working in this sector (Arbeitsmarktbeobachtungsstelle der Autonomen
Provinz Bozen-Südtirol, 2009). However, the prominence of Tisens/Tesimo
in South Tyrolean tourism is quite moderate as a destination. Tisens/Tesimo
currently offers 29 hotels, which rank from one to four stars and offers 816
Downloaded by New York University At 08:17 14 April 2019 (PT)

beds, and another 32 enterprises in the para-hotel sector (mainly farm holi-
days) with 273 beds (ASTAT, 2011b). Tourism demand amounted to almost
105,000 overnights in 2011, of which approximately 84% were registered dur-
ing the summer season (ASTAT, 2011b).
Investments in tourism infrastructure have been lacking for some time in
the destination. Apart from financial resources, two of the major challenges
involve finding enthusiastic successors for the accommodation industry at
business level and developing competitive products at destination level. Yet
Tisens/Tesimo profits from a strong and emerging restaurant sector. Other
institutions with benefits from tourism comprise a caravan park, several
smaller sport infrastructures, and a few castles used for celebrations.

Historical Background and Development

Tisens/Tesimo fits reasonably well into Butler’s classical destination life

cycle model (Figure 2). Its tourism development started approximately 50
years ago, with the arrival of a small number of exploring German tourists
(exploration stage). Initial investments in tourism infrastructure provoked a
sharp growth in arrivals and overnight stays, which continued throughout
the 1970s until the beginning of the 1980s (involvement and development
stages). Initially based on emerging smaller businesses and characterized as
being very community oriented, growth was triggered predominantly in the
later years by two larger four- and five-star establishments. Even though
the 1980s saw some relatively uneven and rapid changes in the development
rate, with a light downturn followed by a steep recovery, the decade as a
whole saw slowing growth rates and is therefore best described as the con-
solidation stage. In the early 1990s, when tourist numbers were temporarily
peaking and the two larger hotels had closed, Tisens/Tesimo had already
entered the stagnation stage. Tisens/Tesimo’s heavy reliance on repeat trade
 124 Contemporary Destination Governance
Downloaded by New York University At 08:17 14 April 2019 (PT)

Figure 1. Locating Tisens/Tesimo

20000 Involvement Development Consolidation Stagnation Decline Rejuvenation?

Exploration
16000

12000
Arrivals

8000

Nine-year moving average

4000

0
1965 1970 1975 1980 1985 1990 1995 2000 2005 2010
Year

Figure 2. Tourist Arrivals to Tisens/Tesimo and Destination Life Cycle

 Tisens/Tesimo 125

was also characteristic of these later stages (Getz, 1992). Even though envir-
onmental degradation was not the problem as in other examples of declin-
ing destinations, the destination has seen a drop in arrivals from 1995 to
2008, accompanied by a reduction in beds and accommodation enterprises
(Wirtschaftsforschung [WIFO], 2011). The former mayor and hotelier
observed, “our boom phase lasted from the early 1970s to the late 1980s.
The downturn came when the few larger hotels and several small private
accommodations closed.”
Partly caused by the drop in demand induced by external reasons such
as cheaper long-distance travel and partly by succession problems and
investment delays in the local family businesses, tourism infrastructure had
Downloaded by New York University At 08:17 14 April 2019 (PT)

been largely run down. Furthermore, given that larger enterprises were
missing or had already closed, cluster formation did not occur. Compared
to the early 1980s, the downsizing in professional hotel businesses amounts
to negative 45% in Tisens/Tesimo, whereas at the regional South Tyrolean
position, the number dropped by only 15% over the same period (WIFO,
2011). Given this situation in Tisens/Tesimo, the aim of destination man-
agement was to halt the startling decline and initiate a rejuvenation process.
To do so successfully, investment in attractions and products, which should
be embedded in a clear destination strategy and an effective as well as effi-
cient destination governance (Pechlaner et al., 2009; Ruhanen et al., 2010),
was deemed necessary, including subsequent expansion of accommodation
supply in both quality and quantity. As illustrated in Figure 2, Tisens/
Tesimo has managed to reverse the trend in the last couple of years, with
an initial increase in 2005 06 followed by a more constant one mainly
from 2008 to 2009 onward. The number of arrivals has started to rise again.
Potential reasons for this apparent relaunch are discussed below.

Products, Services, and Market Situation

Tisens/Tesimo satisfies the resource-based precondition for growth

(Pechlaner et al., 2010b). The potential for starting a rejuvenation process
has always existed, even in the most difficult years. Tisens/Tesimo has all
the necessary resources to occupy promising niches in the market.
Benefiting from its unique geographic location in the lower mountains and
its favorable climate, Tisens/Tesimo has traditionally offered products
focused on hiking and regeneration. It has mainly attracted tourists looking
for natural activities with a low to medium sporting effort. Besides its nat-
ural attractiveness, Tisens/Tesimo also has a substantial, and insofar largely
unexploited, cultural potential. The cultivated landscape of vineyards, apple
orchards, and chestnut trees, together with numerous quality local and
 126 Contemporary Destination Governance

haute cuisine restaurants, provide a vast offering for tourists interested in

culinary delights. Lately, some culinary feasts such as chestnut days have
been successfully introduced, which have enriched the gastronomic product
line. Tisens/Tesimo is also strewn with various castles, reinforcing its posi-
tion as a cultural stronghold. In the future, the destination seeks to further
strengthen its potential in culinary tourism, make stronger use of its strate-
gic vicinity to major tourism attraction points in South Tyrol (e.g., Bozen/
Bolzano and Meran/Merano), improve the quality of the accommodation
infrastructure, and develop a concept of a mountain zoo as a local
attraction.
Since its advent as a destination, Tisens/Tesimo has been facing the
Downloaded by New York University At 08:17 14 April 2019 (PT)

structural problem of strong dependency on the German market and older

tourists. The proportion of tourists originating from Germany amounted to
90% in the early 1970s, and this has only slightly decreased to 82% in 2011
(WIFO, 2011). However, a recently established caravan park has contribu-
ted to an increase in the number of tourists from the Benelux countries
(i.e., Belgium, the Netherlands, and Luxembourg). The destination primar-
ily appeals to older tourists in search of relaxation and tranquility. Its main
offerings are particularly suited to the needs of senior tourists, such as hik-
ing trails of medium to low difficulty in the submountainous surroundings,
the calm atmosphere and off-the-beaten-tracks away from the major traffic
routes, as well as the mild climate with relatively short and snowless winters
and temperate summers due to its position on the high plateau. Another
currently targeted group, though less important than older people, is
families. In order to diversify the market structure, Tisens/Tesimo could
strengthen its positioning as a mountain bike destination. With its romantic
castles and high quality gastronomic sector, Tisens/Tesimo has some poten-
tial for attracting wedding tourists and those interested in culinary experi-
ences. In order to reach these potential target groups in the future, a partial
switch from budget to quality tourism including the accommodation sector
is essential.

Governance

Bodega, Cioccarelli, and Denicolai (2004) distinguish four types of interor-

ganizational cooperation in destinations: the community model, the cor-
porative model, the governed model, and the constellation model.
Conceptually, the community model is characterized by relatively weak
cooperative ties (low relational density) and by the absence of a central coor-
dinating actor (low centralization). Tisens/Tesimo matches this community
 Tisens/Tesimo 127

model reasonably well. Moreover, it is also a case suited to exemplifying

some shortcomings of the form of governance covered by this model. The
low centralization is evidenced by the fact that cooperation in Tisens/
Tesimo is mainly of an informal character without clear hierarchies. Most
relationships emerge depending on the specific projects to be realized.
Although an institutionalized coordination system exists around the local
DMO, its impact is modest. As a consequence of the shutdown of several
contributing businesses, the DMO has become financially less weighty in
network moderation.
Some coordination has emerged from the activities of the former mayor
who successfully combines his function as president of the hoteliers’ asso-
Downloaded by New York University At 08:17 14 April 2019 (PT)

ciation with his role as a tourism entrepreneur. Bodega et al. (2004) describe
how, in the case of the community model, a low degree of centralization
often leads to suboptimal implementation of a common strategy. In line
with these considerations, until very recently cooperation in Tisens/Tesimo
with regard to destination development evolved more by chance than by
common strategic planning. Self-governance of single actors considering
individual interests and traditional conventions prevailed. Effectiveness is
about “doing the right things” (Drucker, 1966), setting and realizing clear
objectives (Batterbury & Fernando, 2006; Eagles, 2009), and practicing
targeted action. The situation in Tisens/Tesimo may therefore be described
as being one of suboptimal effectiveness of destination governance, which
could be one possible cause of the downturn in the second half of the 1990s
and in the first years after the turn of the millennium.

Within the destination, we concentrate too much on day-to-

day business. We solve problems that occur. But there is very
little long-term planning. Over the last few years we have
made some progress in this regard … but still remain far
from the necessary degree of strategic planning. There is still
much to be done (former mayor and hotelier).

Lately, with the participatory elaboration of a strategic vision in the

form of tourism development concept (EURAC Research, 2009), some
attempt has been made to improve the effectiveness of governance.
Tourism development concepts are used in South Tyrol to regulate further
tourism development. Each community could elaborate a concept where
the strategic positioning of the destination as well as the actually needed
touristic offer (i.e., number of new beds) had to be explained. In other desti-
nations, the tourism development concept could trigger a strategic
 128 Contemporary Destination Governance

coordination (Volgger & Pechlaner, 2012). In the case of Tisens/Tesimo,

this more cohesive strategy was accompanied by a substantial recovery of
tourist arrivals from 2008 to 2009 onward (ASTAT, 2011b). Although cau-
sal interpretations must be made with caution, it seems conceivable that the
improved effectiveness of governance through a common strategy has sup-
ported the process of recovery. In the community model, due to relatively
low degrees of cooperation, destinations do not fully realize their network-
ing potential and synergy opportunities (Bodega et al., 2004). The low rela-
tional density of Tisens/Tesimo is underlined by the fact that individual
action dominates. The DMO manager explained, “The local value chains
exist, but these cycles are often interrupted …. Unfortunately, we some-
Downloaded by New York University At 08:17 14 April 2019 (PT)

times have a tendency to be jealous of each other.”

Some coordination takes place from the inside by actors comprising a
small entrepreneurially active group including the former municipality’s
mayor who is now president of the hotelier’s association, the DMO presi-
dent, some single hotel and restaurant managers, and a taxi entrepreneur,
as well as the regional DMO Meran Marketing Organization from the out-
side. Their means of governance are institutional power on the part of the
president of the hoteliers’ association and reputation. Within the destina-
tion, this active group is quite well accepted. However, they have some pro-
blems activating local development potentials, because a pronounced vision
for the destination has not yet been generally adopted. The diverging inter-
ests of the other actors continue to constrain their influence. Hence, the
existing intersection points of the different interests (e.g., the common
ambition to extend the summer season) provide important options for
action. Recently, driven by a few common projects, the degree of coopera-
tion seems to have been growing. Some intersectoral cooperation exists
between agriculture, restaurants, and the accommodation industry, which is
prompted by the increasingly congruent objectives that flow from the recent
emergence of farm holidays. However, most of these networking and coop-
eration attempts take personal forms and are not institutionalized. The cen-
tral actors choose their partners individually and interact with them
according to the various projects. Most communication takes place at the
regulars’ tables. A partial exception to this informal configuration is the
conceptualization and organization of the yearly chestnut days, a successful
culinary feast, which was launched only a few years ago.

The chestnut days are a good cooperation. If we did not take

the original product from the farmers, the feast would be,
yes, an event, but one without life. But the chestnut feast is a
 Tisens/Tesimo 129

really authentic one, and consequently, also very successful—

with regard to both locals and guests (former mayor and
hotelier).

The chestnut days festival is exceptional in that it involves private enter-

prises of different industries (e.g., tourism, agriculture, and gastronomy),
private public organization (i.e., the local DMO), and two municipal
administrations. It can therefore be classified as institutionalized, intersec-
toral, and intermunicipal cooperation. However, the cooperation remains
tied to the underlying project and is hardly generalized. In general, and in
spite of recent improvements, the functioning of cooperation and coordina-
Downloaded by New York University At 08:17 14 April 2019 (PT)

tion in the destination still remains below the efficient optimum. Efficiency is
about “doing things right” (Drucker, 1966) and implies an input output
ratio (Barros, 2005). In destination governance it relates to the realization of
positive effects through coordinated networking that does not require dispro-
portionate efforts (Pechlaner, Raich, & Beritelli, 2010c). Due to few frictional
losses, efficient cooperation is able to generate high amounts of desired
output while avoiding extraordinary transaction costs (Williamson, 1979).
In tourism the concept of efficiency has been used to describe the interplay
between environmental impacts and economic benefits (Gössling et al.,
2005), as well as to measure and compare the technical efficiency of the
hospitality sector (Assaf & Agbola, 2011; Barros, 2005; Brida, Garrido,
Deidda, & Pulina, 2012). Beyond these applications, efficiency is also useful
in judging the input output relations of collaborative efforts and structures
among the stakeholders in destinations. According to Williamson (1979,
1981), economizing on costs, mainly transaction costs, constitutes the heart
of governance discussions. Governance is about organizing transactions in a
manner that reduces costs of searching, negotiating, monitoring, and enfor-
cing to a minimum. Hierarchies, markets, and networks provide prototypical
organizational forms with particular strengths and weaknesses, which depend
on the characteristics of a transaction including its uncertainty, frequency,
and the degree of specificity in required investments (Williamson, 1981).
However, in its focus on transaction costs, Williamson and the school of
transaction cost economics tend to neglect the value and benefit side of coop-
eration (Zajac & Olsen, 1993). Thus, in the complex context of destination
governance, several different outputs and output indicators require close
observation, such as demand-oriented figures of arrivals, market share or
turnover, and supply-oriented measure of residents’ quality of life. The com-
plexity of partially contrasting relationships between different stakeholders
but also between different target groups may limit the applicability of
 130 Contemporary Destination Governance

traditional ideas of static efficiency. This requires complementing with

dynamic perspectives such as collaborative efficiency (Sabel, 2007).
Nevertheless, transaction cost considerations remain relevant. Similarly
Olson (1965) argues that the structure of smaller groups supports collabora-
tive behavior and facilitates the achievement of collective action. Thus, a
small destination such as Tisens/Tesimo with diverse sectors having a stake
in tourism should provide a fertile ground for collaboration.
However, due to individual opportunism and free riding, transaction
costs also have a negative impact on development in small groups (Olson,
1965; Williamson, 1979). Some cases need active support by setting specific
incentives to promote and sustain collective action (Olson, 1965). The situa-
Downloaded by New York University At 08:17 14 April 2019 (PT)

tion in Tisens/Tesimo supports this notion. First, a set of shared and com-
monly defined goals seems to act as a notable incentive. Second, efficiency
and the willingness to invest in the collaborative system can be strengthened
by the establishment of trust and peer control among the diverse stake-
holders (Beritelli, 2011c; Denicolai, Cioccarelli, & Zucchella, 2010; Dyer &
Singh, 1998; Ostrom, 1990). In order to create trust and realize a collabora-
tive community, tangible, repeated, and repeatedly assessed projects will
play a complex and leveraging role (Gulati, 1995; Gulati & Sytch, 2008;
Sabel, 2007). For instance, the yearly event of chestnut days eases colla-
boration between the different actors in Tisens/Tesimo.

For future development, the destination can mainly build on

two or three tangible events. These are first of all the chestnut
days in autumn, which attract more and more people who
come especially for this purpose … In this sense, the chestnut
festival facilitates cooperation between agriculture and tour-
ism. Chestnuts used to be a product for the poor. Nowadays,
thanks to the chestnut days, demand for the product is huge.
The chestnut days create mutual benefits for all the involved
parties (hotelier).

The case of Tisens/Tesimo illustrates how periods of somewhat ineffec-

tive and inefficient governance and strategic weaknesses result in insufficient
profiling and suboptimal networking and may contribute to driving destina-
tions into the stagnation and decline stages. Consequently, quality problems
have emerged and large site-specific investments have not been encouraged
in Tisens/Tesimo. The case also suggests that, in order to head out of
decline and into rejuvenation, the two governance parameters of targeted
collective action and transaction cost-efficient networking are critical. In the
 Tisens/Tesimo 131

elaboration of a tourism development concept (EURAC Research, 2009),

some steps toward a more effective destination governance have already
been made. Initial results in terms of tourist arrivals, which started to rise
again, seem encouraging. Now, the successful implementation of this com-
mon strategy appears to depend decisively on whether a comparable
improvement in the efficiency of governance can be achieved, for example,
by further strengthening the functioning of the network. The above-
mentioned projects, in particular the chestnut days, are a good starting
point. However, promoting tangible cooperation on an everyday basis is
crucial in this regard (Pechlaner & Volgger, 2012).
The aim for the immediate future is to consolidate the initiated rejuvena-
Downloaded by New York University At 08:17 14 April 2019 (PT)

tion process. Tisens/Tesimo has the potential to succeed in this endeavor,

because some essential preconditions for successful change such as
resources and shared strategy are met; and efficient collaboration seems to
be moving in the right direction. As explained above, the necessary resource
base is available. Scope does exist to turn the accumulated weaknesses into
strengths. Two decades of low investment levels helped to avoid an overex-
ploitation of the natural environment and an excessive commodification of
culture. This means that authenticity, which may be a key requirement to
promote sustainable development of destinations (Castéran & Roederer,
2013), could be largely preserved.
However, in order to consolidate the relaunched development in Tisens/
Tesimo, the existent resources need to be leveraged by an effective and
efficient governance that provides an overall strategic framework on the
one hand, and a fast and reliable coordination and communication function
on the other. With the current elaboration of a tourism development con-
cept (EURAC Research, 2009), the foundation for a consistent destination
strategy has been laid. In the long run this development concept could lead
to a commonly shared vision and thereby embed future product develop-
ment. Outstanding tasks involve further increasing the efficiency of govern-
ance. Establishing a functioning network and creating involvement
(Pechlaner & Volgger, 2012) could become decisive factors throughout this
second change corridor (Pechlaner et al., 2010b) and might strongly influ-
ence the future course of Tisens/Tesimo’s life cycle. Particularly, the ques-
tion regarding the future role of Tisens/Tesimo inside the holiday region
comprising Meran/Merano and its environs needs to be resolved.
Williamson (1981) compares transaction costs to friction, insofar as they
constitute a loss of energy that should be prevented as far as possible.
However, Sabel (2007) argues that such a concept of efficiency, which aims
to reduce any kind of friction, could be termed bureaucratic efficiency and is
 132 Contemporary Destination Governance

different from collaborative efficiency, which regards friction as a source of

innovation and adaptation. Which one of the two structuring principles
leads to situations that are more desirable may depend on the settings.
Whereas collaborative efficiency expresses its strengths mainly in changing
environments, in contrast bureaucratic efficiency works best in stable
contexts. However, bureaucratic efficiency seems markedly less resilient to
crises and difficulties (Sabel, 2007; Zajac & Olsen, 1993). From a develop-
ment perspective and a life cycle approach therefore, efficient governance
should include the capability to adapt efficiently to continuously changing,
fluid conditions (Sabel, 2007). Hence, collaborative efficiency appears to be
a useful concept, which links goal setting and goal achievement (effective-
Downloaded by New York University At 08:17 14 April 2019 (PT)

ness) with a minimum use of resources (efficiency) in network contexts.

By taking the centralization dimension into account, Flagestad and
Hope (2001) differentiate the decentralized community model of destination
governance from the corporate model, the latter being characterized by a
dominant corporate actor. Given that Tisens/Tesimo is strongly rooted in a
community-oriented and decentralized organization pattern, the premises
for highly dynamic and collaborative efficiency are obvious. The capacity
for stopping the downturn and embarking on first steps to rejuvenation
indicates the resilience of Tisens/Tesimo. To further promote collaborative
efficiency, it is necessary to consider how collaboration and networking
should be organized in an effective and efficient manner without falling into
the seductive trap of hierarchical organization. Thus, to strengthen colla-
borative efficiency, preservation of the existing low level of centralization
should ideally be coupled with an enhanced relational density, with an
increased cooperation level in the form of integrated product development,
participatory decisionmaking, and stabilized levels of trust.

CONCLUSION

Broad cooperation in the form of institutionalized networks seems to be the

most promising configuration to foster the future development of the desti-
nation. Given the small size of the single tourism enterprises, cooperation is
an obvious means to promote the realization of innovative potentials
(Nordin, 2003; Scott & Storper, 1989). In this case, Tisens/Tesimo’s govern-
ance structure would essentially evolve to a constellation model (Bodega
et al., 2004). Following Raich (2006) and Pechlaner and Volgger (2012),
a revalued DMO could make a major contribution to this process by
 Tisens/Tesimo 133

establishing itself as an accepted and trusted intermediary and thereby pro-

mote more stable and cost-efficient interorganizational relationships. This
may also require creating stronger outward links with the holiday region of
Meran/Merano and its environs and establishing clearer task sharing
between private and public actors.
In contrast, issues that put Tisens/Tesimo’s rejuvenation at risk and need
to be tackled include the low professionalization of some actors in terms of
adaptive capabilities to market change, the remaining parochialism between
the village districts, the financial weakness of the entrepreneurs, and the
lack of descendants willing to succeed the older generations. However,
increasing the collaborative efficiency of its destination network by balan-
Downloaded by New York University At 08:17 14 April 2019 (PT)

cing dynamic efficiency with lower transaction costs in collaboration is

probably the greatest challenge for Tisens/Tesimo in order to foster
collaboration-specific investments of entrepreneurs that support a sustained
rejuvenation of the destination.

QUESTIONS

1. Do you agree with the notion that in specific periods of “change corri-
dors” during the destination life cycle, intervention through governance
is more influential than in other more stable periods?
2. Do you agree with the interpretations of effectiveness and efficiency
in the context of destination governance as they are presented in this
case study? Could collaborative efficiency conceptually merge them, as
suggested in this case?
3. What are the crucial issues in the attempt to make destination govern-
ance more efficient?
4. Do the various types of destination governance differ between one
another with respect to the conditions they imply for the realization of
efficiency or effectiveness? Take as a basis for discussion the typologies
in Flagestad and Hope (2001) or in Bodega et al. (2004).
5. What are the major obstacles to relaunching destinations? How can a
DMO encourage involvement of the destination’s actors in the relaunch-
ing process?