Business excellence and innovation is becoming more and more important on a global scale. To stay competitive under the pressures from China and Eastern European countries, companies have to strive for continuous improvement and excellence. There are several managerial concepts known in the management literature that enables this path. We compare programs like TQM (Total Quality Management), Six Sigma, Lean manufacturing, CIP – Continuous Improvement Process, ISO 9000 standards, 20 keys methodology. We found that all these managerial innovations do have a common root in TQM. Then we research the applicability of these concepts in service industry with emphasis on hotel industry. We review the status of these managerial innovations (the level of adoption and future plans of adoption and usage) in Croatian manufacturing based on the EMIS 2006 (European Manufacturing Innovation Survey) and try to generalize these findings for service sector. General findings are that innovative management concepts are still not in wider use in Croatian manufacturing and that adoption of these concepts does not necessarily yield better financial results. Through this survey’ s results we pinpoint where the bottlenecks are and propose potential explanation for the found phenomenon.

Economics