This study adopted the Hotel Royal Group and its Chief Executive Officer Mr. Winston Shen as a case study, and further analyzed Hotel Royal Chiaohsi’s service innovation. Hotel Royal Group includes Hotel Royal Hsinchu, Hotel Royal Chihpen, Hotel Royal Chiaohsi, Hotel Royal-Nikko Taipei, and Hotel Royal Beitou. All of them are international tourist hotels. CEO Mr. Winston Shen also serves as the general manager of Hotel Royal Chiaohsi. Analysis of the blogger's stories written by past residents of Hotel Royal Chiaohsi showed mostly positive responses to the service quality. There were also innovative activities that surprised customers with positive intention to come back again. CEO Mr. Winston Shen proposed the concept of "shadow of the demand," indicating that extension of the previous satisfied needs to create somehow similar but somehow new experiences is more likely to produce amazing feelings for customers. The service innovation is a process of thinking, extracting, and transforming. For example, think about local culture, extract elements that fit consumers, and transform the elements into attractive incentives. To make the operation of innovative business model work, companies need to shape the corporate culture concerned with "people", implement corporate system and rules, and invest resources in employee’s trainings. This study concludes with a framework of service innovation in Hotel Royal Chiaohsi for other companies' reference.