Change Management in Tourism Sector: A Case Study of TUI

This essay analyses change management in tourism sector with a case study of TUI. It discusses theoretical approaches, purpose, objectives, vision, mission, process of change management, and environment analysis. It also covers KPIs and concludes that changes are necessary for better performance and growth of the organisation.

Strategy and Change
Management

Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
CONCLUSION ..............................................................................................................................6
REFERENCES................................................................................................................................7
APPENDIX......................................................................................................................................9

INTRODUCTION
This essay will analyse change management in tourism sector. Tourism is the biggest
industry of the world and has changed rapidly in the past years. Tourism is a set of activities
undertaken by the human beings for the purpose of pursuing relaxation (Larsen, Boje and Bruun,
2020). The organisation chosen for the purpose of writing this essay is TUI. The essay include a
discussion about the theoretical approaches adopted by the Travel and Tourism organisations to
make a change and modify their strategic directions. In addition to it, an evaluation of the
purpose, objectives, vision and mission set in strategic directions is also being considered.
Further, an assessment of the process of change management with the help of a models and what
changes does the organisation need to adopt are being discussed in this essay. The essay
contains an overview of the company such as market share and size and to critically discuss
about the company. The environment of the company is analysed with the help of SWOT,
PESTLE and Porter's Five Forces.
MAIN BODY
With that in mind, TUI (About TUI, 2022) is a UK-based travel group established in
CrawleTUI travel group was the result of the merger of First Choice Holidays PLC and the
Tourism Division of TUI AG. TUI operates in almost 180 countries and thus have a wide
customer base. There are millions of customers on whom the company have access on. The
company occupies 20 percent of the market share approximately in UK ( Cui and et. al., 2022).
In Europe, TUI is the largest travel group and have nearly 562 stores across UK. TUI is a public
travel group and is listed on London Stock Exchange. The company has various airlines
established in different countries such as France, Belgium, Germany, Russia, etc. The policy of
the company, primarily, states about the challenges and opportunities in the tourism sector and
the ways to tackle them.
Strategy refers to the action plans designed by the management to achieve the objectives and
goals set up by the organisation (Moghimi, 2022). Planning and designing a strategy is very
important for an organisation and benefits the company in various ways. Good strategy helps the
management to identify the directions, moving on which will benefit the organisation (Lips and
Et. Al., 2019). Moreover, strategic management helps the employees to have a better
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understanding of the goals and ways to achieve them. Better vision of job improves the
performance of the employees. Strategy helps to evaluate the position of organisation in the
marketplace and how to improve it (Mishra and Et. Al., 2018). Strategic management help TUI
to co-ordinate stakeholders with the development of the destination. A clear image of the
destination must be presented to the public. TUI first identifies its priorities on which the
organisation need to work and plan accordingly (Hong and Et. Al., 2018). It gives the company a
direction to move and measure the success of achievement of goals through the performance of
its employees.
Strategic planning process can be analysed using the transitional model of Williams and Bridges
(Chen and Guo, 2022). The transitional model of Williams and Bridges throw some light on the
difference between transition and change (Song and Et. Al., 2021). The very basic difference
between the transition and change is that transition takes place at the option of the organisation
and is an internal process. While change takes place even if the organisation do not want to let it
happen (Malik and Khan, 2021). There are three stages covered by this model. First is the
ending, losing and letting go, second is the neutral zone and third is the new beginning. In the
first stage, employees are made understand their role and responsibilities when a change takes
place in TUI. At the second stage, employees in TUI, are guided by the managers patiently in
order to end their confusion, if any. In the last stage, when the results start coming shows the
new beginning of business. Everyone in TUI feels contented as all their hard work paid off. A
clear vision and mission enables the whole organisation of TUI to work together towards the
achievement of same goal and destination. It enables the company to develop measurable goals
and objectives. TUI changed its working system from paper to technical world. The change was
made to reduce manual work, save time and to make employees familiar with the technical
gadgets as these are highly used everywhere. So the clear mission and vision of saving time,
ending manual work and training employees were the reasons for the change in the working
system.
As mentioned, a clear vision and mission should enable TUI and its stakeholders to help achieve
TUIs goals. It enables the company to develop measurable objectives. TUI changed its working
system from paper to technical world (Hamada and Akzambekkyzy, 2022). TUI aims to be one
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among the leading travel groups in the whole world. The group wants to achieve the goal of
customer satisfaction by providing them with a wide variety of products which has the capability
to satisfy changes in their needs, if any. In addition to it, the group tries its level best to keep
their words and promises in order to bring smile on their customers' face (Vision and Values,
2022). The vision of TUI group is “THINK TRAVEL THINK TUI”. The company wants its
employees and customers to get engage in thinking and travel more and give TUI an opportunity
to serve them. The TUI group work on three core values namely, trust, unique and inspire. The
group wants their products and services to be of good quality and should be quite reliable as the
customers trust the organization. The unique facilities provided by the entity are the centre of
attraction for its customers and the group looks forward to serve them with more unique features.
The group takes and wants to be an inspiration.
PESTLE analysis is done to analyse the external environment of an organisation (McLeod, Hine
and Please, 2019). Political stability in UK helps TUI to operate smoothly. While the financial
markets are quite efficient which enables TUI to raise capital easily. TUI should focus on
increasing their customer experience by offering new and innovative products. The increase in
the use of smartphones and social networking sites can help TUI to grow its business by going
online. Further, TUI maintains secrecy of its customers by following the consumer protection
laws. TUI has adopted recycling as a business norm which helps the organisation to contribute to
the environment.
There are various internal and external factors which can trigger a change in the organisation as
shown by the SWOT analysis in Appendix 2. According to (Hou and et. al., 2022) Internal
factors include low satisfaction and performance, conflict, new leadership, etc. On the other
hand, external factors include government laws, market demand, growth of technology, etc.
Kubler Ross model (Zhan and et. al., 2022) is a change management model which comprises 5
stages of denial, anger, bargaining, depression and acceptance. This model helps to show the 5
stages of grief a human feels after any change takes place in the organisation. First stage is the
denial that employees may use to protect from hardships occurred due to change-management.
TUI changed its way of working and reduced the use of paper to a great extent. This made
employees uncomfortable as they were not familiar with the technical tools. As a result, they
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denied the change in the working system. In the second stage, anger is used by the employees to
express their feelings and emotions . Change in the working system took employees out of their
comfort zone which made them quite angry. All the employees, collectively, went to the
directors to make them change the decision taken. Bargaining is the next stage of this model
where employees try to reduce the burden of hardships and gain some control over them. When
the directors of TUI denied to changed their decision, the employees requested them to make
changes slowly. They were not ready for such sudden changes in the working system.
Depression is faced by the employees of an organisation with the feelings of sadness, fatigue,
etc. The directors of TUI denied to change their decision at any cost, even after bargaining. This
made the employees sad and depressed. Last stage is the acceptance by employees of the change-
management that took place in the organisation. At last, they had to accept the decision that was
being taken by the directors and make themselves ready for the change. Further, TUI provided its
employees with good trainers to train and make them familiar with such technological tools. This
reduced the hardships on the employees and made them feel quite relaxed.
Emergent and prescriptive are the two approaches which help an organisation to manage the
change made or taken (Schenk, 2022). Generally, emergent approach is used by TUI to manage
changes in the organisation. For instance, TUI uses airlines to let passengers commute from one
place to other. One of the employees noticed that there are many tourists who wish to travel with
the means of water. The employee suggested the idea of starting water transports along with air
lines to other employees and the senior management. The management liked the idea and
thought to try this. TUI started performing better and the emergent strategy of adopting water
transports was ratified by the management. This proved very beneficial for the international
market. While in the local and national markets, TUI added on food and beverages in their
tourism package which were very appealing to the general public. There are three stages in
Lewins models (Sheperis and Bayles, 2022), namely, unfreeze, change and refreeze. The
application of the Lewis model in a prescriptive approach of change-management is to be
discussed. TUI faces an intense competition from its competitors and thus can change its strategy
of environmental and economic sustainability. The organisation will have to focus more on the
improvement of products and services supplied rather than just the sustainability. TUI will first
need to drop the current strategy for adopting a new one, i.e., unfreeze. Then the company needs
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to mould its employees and working of the organisation in the new strategy which refers to
change. At this stage, the company needs to make its whole management familiar with the new
strategy. Lastly, the refreeze stage refers to the application of new strategy within the
organisation.
KPI is the acronym for 'Key Performance Indicator'. It is used to measure the performance of the
employees and the organisation (Bachmann and Et. Al., 2020). KPI's help to evaluate the success
of the company in a quantifiable amount. Some of the KPI's used in the tourism sector of UK are
the early-morning flights must leave the airport on time as they set the schedule for he entire day,
profit margin, customer satisfaction, retention of clients, etc. (Maimon, 2018). Some of the key
performance indicators used by TUI are customer satisfaction, higher productivity, alignment of
goals with the organisation, cost effectiveness, etc. TUI tries to satisfy its customers by offering
them the best deals at the lowest possible cost. This helps them to retain clients as well as to
increase their customer base. The company cut off unnecessary expenses such as stationary by
changing the working system from manual to technical. This reduced the costs and thus TUI is
able to give products and services to its customers at a low cost. This helps TUI to perform better
in the markets, whether national or international. Better performance results means better
productivity which can be obtained through customer satisfaction. Further, TUI gets a good
return on the investment and gets supplied with sufficient amount of funds. This helps the
organisation to hire more creative thinkers for bringing innovative ideas that look appealing to
the customers. This helps to attract new customers. It is the duty of the organisation to look after
the well-being of its customers, especially during the tour. Hence, the company is able to achieve
the KPIs set by them.
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CONCLUSION
To conclude, this essay has discussed change management and found that changes are
quite necessary in an organisation, to increase their efficiency and perform better. Like every
industry, tourism industry too have to mange the changes that takes place in the tourism sector.
These changes have a significant impact on the working of an organisation which impacts the
mission and vision of the organisation. The chosen organisation changed its working system
which affected its employees to a huge extent. But after sometime, they began to perform better.
This shows that changes could be uncomfortable for the organisation at the beginning but can be
beautiful enough for the organisation which could be seen in the results. There are various
factors which can trigger changes in an organisation. These factors could be present in internal or
external environment of an organisation. Not only changes, but management of such changes is
also important. The management of changes help the organisation in their application. Changes
made must be properly made applicable for better performance and growth of the organisation.
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REFERENCES
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Quijano, D.A., and et. al., 2022. A Price-Based Strategy to Coordinate Electric Springs for
Demand Side Management in Microgrids. IEEE Transactions on Smart Grid.
Schenk, D., 2022. Roadmap for the Development of a Procurement Strategy in a Construction
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Online
About TUI, 2022 [Online]Available through:<https://www.tui.co.uk/>
Vision and Values, 2022 [Online]Available through:<https://www.tuigroup.com/en-en/about-
us/about-tui-group/vision-values>
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APPENDIX
The environment of TUI can be analysed with the help of a SWOT analysis.
Figure 1 The SWOT analysis
Strength - UK and France are the fastest growing markets and enables TUI have a strong
leadership position in the travel industry. This enabled the firm to stand head string in the market
even during the time period of COVID. The company implemented certain strategical actions to
cop up with the situation of pandemic which helped in the survival of the strong market
positioning (De and Mandal, 2022).
Weakness - But the competition faced by TUI is quite high which limits its brand loyalty. This
even turned out to be a restriction during the time of COVID and the company faced several
hurdles in the maintenance of the positioning and alignment in the market place (Quijano and et.
al., 2022) .
Opportunity – The opportunity to go online and work accordingly during the time period of
pandemic gave TUI a chance to effectively conduct its operations. TUI looked down to online
applications, as a prospect, for reservation and holiday booking. This significantly helped the
company to retain in the market picture and secure the already established position in the
business environment (Fergnani, 2022).
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Threats - High competition in the market could a threat to the pricing strategy adopted by TUI.
The company must look upon this situation in a significant manner and try to incorporate
effective and significant approaches to beat the rising scope of rivalry (Cheng and et. al., 2022).
TUI faces a moderate threat from its competitors. However, the organisation has
managed to gain competitive advantage over its competitors with the help of strong and efficient
strategies. Also, the organisation faces an intense competition from its competitors and tackles
the same by building sustainable differentiation. TUI builds a large customer base by offering
products at a low price which helps the organisation in reducing the bargaining powers of the
buyers. Being a huge company, TUI buys raw materials from various suppliers and thus is not
dependent on any one supplier. This make the supplier sell products at reasonable cost and
makes the threat of suppliers low. TUI tackles the threat from its substitutes by being service
oriented along with product oriented. (Tawse and et. al., 2022).
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