Impact of COVID-19 on IHG: A Study on Challenges and Strategies

This report analyzes the impact of COVID-19 on the hospitality and tourism industry, specifically IHG, and the challenges faced by the industry in managing their customers and organizational activities. The report also examines the ways used by IHG to overcome the impact of the global pandemic. The research methodology includes interpretivism research philosophy, inductive research approach, case study research strategy, and qualitative research choice. The findings from secondary data suggest that COVID-19 has created a risky situation for the industry, resulting in minimized profitability and customer attention. However, the industry has adopted measures to increase cleanliness and use advanced technology to innovate business functions.

Foundation year project

Table of Contents
CHAPTER 1: INTRODUCTION....................................................................................................3
Background.............................................................................................................................3
Aim.........................................................................................................................................3
Objectives...............................................................................................................................3
Research problem...................................................................................................................3
Research questions.................................................................................................................3
CHAPTER 2: LITERATURE REVIEW.........................................................................................5
What are the issues faced by IHG due to the outbreak of COVID-19?.................................5
What are the challenges faced by IHG in their operational functions due to outbreak of
COVID-19?............................................................................................................................5
What are the ways used by IHG to overcome with the impact of global pandemic COVID-19
................................................................................................................................................5
CHAPTER 3- METHODOLOGY...................................................................................................6
CHAPTER 4- RESEARCH USING SECONDARY DATA..........................................................9
CHAPTER 5: CONCLUSION......................................................................................................13
REFERENCES..............................................................................................................................14

CHAPTER 1: INTRODUCTION
Background
The outbreak of COVID-19 has developed severe issues for all the businesses but this
specifically drawn major impact on hospitality and tourism industry (Škare, Soriano and
Porada-Rochoń, 2021). As these are the industries wholly dependent on their customers and the
industry has higher value for their customers. The outbreak of COVID-19 has given serious
issues to the industries which are related with lowered profitability and customer footfall. The
organisation taken for the current report is IHG which is a British multinational hospitality
organisation headquartered in England. The company is having their presence in different
nations and at the same time the organisation is putting their efforts to enhance their presence.
Aim
To examine the impact received by tourism industry in their operational functions due to
outbreak of COVID-19 and ways adopted by the industry to overcome with global pandemic. A
study on IHG
Objectives
● To investigate the issues faced by IHG due to the outbreak of COVID-19
● To analyse the challenges faced by IHG in their operational functions due to outbreak
of COVID-19
● To determine the ways used by IHG to overcome with the impact of global pandemic
COVID-19
Research problem
The outbreak of COVID-19 has created different issues for survival of tourism and
hospitality industry. These issues have given impact on business operation of tourism and
hospitality industry in which the industry is facing complications in managing their customers
and organisational activities (Beh and Lin, 2021)On the other hand, the industry is also needed
to develop such measures by which they can deal with outbreak of global pandemic COVID-19
so that they can align their business functions with new normal.

Research questions
● What are the issues faced by IHG due to the outbreak of COVID-19?
● What are the challenges faced by IHG in their operational functions due to outbreak of
COVID-19?
● What are the ways used by IHG to overcome with the impact of global pandemic
COVID-19?

CHAPTER 2: LITERATURE REVIEW
What are the issues faced by IHG due to the outbreak of COVID-19?
According to Yeh, (2021), there are different issues faced by the tourism industry due to
the outbreak of COVID-19 in which minimised occupancy rate and profitability was the major.
The industry was not able to execute their business functions in accurate manner due to
restrictions imposed by the government which has restricted movement of people at tourist
locations (Volkmann and et. al., 2021). The industry is one of the major those have seen the
highest negative implication of COVID as the industry is directly related and relied on their
customers.
What are the challenges faced by IHG in their operational functions due to outbreak of COVID-
19?
According to Hong and et. al., (2020), there are numerous challenges which are being
faced by tourism industry due to the outbreak of COVID-19. For managing business functions
in low profitability different measures were taken by the industry such as they had to lay off
their employees and cut down their wages. This way operational challenge was also faced by
the industry in which the industry had to find way for their survival (Arshad and et. al., 2021).
Another operational challenge is related with working in limited resources and staff as due to
restrictions this was not possible to call whole the staffs which have created issues for the
industry to manage their business functions.
What are the ways used by IHG to overcome with the impact of global pandemic COVID-19
According to Papanikos, (2020), there are different measures which were adopted by
hospitality and tourism industry so that to overcome with the impact of COVID-19. In this
using of safety and hygiene measures was the prominent. As the organisation has used different
practices in which they can upkeep safety precautions so that uninterrupted experience can be
given to their customers (Del Chiappa, Bregoli and Fotiadis, 2021). On the other hand, the
industry has used different technological advancements so that business functions can be
aligned with market needs.

CHAPTER 3- METHODOLOGY
Research Philosophy: This is considered as one of the major research method which
helps in giving insight regarding research objectives. This is divided into two forms such as
positivism and interpretivism. For this research the researcher will use interpretivism research
philosophy so that to execute the research in non-numerical manner.
Research Approach: This is another research method which is divided into two types
such as inductive and deductive (Rinjit, 2020). For the current research the researcher will use
inductive research approach so that to acquire assistance in analysing theoretical information
related with research topic.
Research Strategy: This is divided into different types such as grounded theory, action
research, case study, survey and many others (de Vries 2020). The researcher will select case
study for the current research as this will lead the researcher to gather authentic information
directly from website of the organisation which has been selected.
Research Choice: For the current research the researcher will choose qualitative
research choice so that to collect, use and evaluate theoretical data within research (Likhanov
and Lopatin, 2020)
Data Collection: Data collection is of two types such as primary and secondary.
Investigator will choose secondary data within the research (Mukherjee, 2019). The major
advantage of this method is that under this theoretical information can be gathered so that using
newspaper, articles and books such authentic information can be acquired.
Data Analysis: For the research the investigator will be choosing thematic analysis so
that accuracy and relevancy can be maintained within research.
Time framework: With the help of using Gantt chart the researcher will schedule all
the activities within research so that every single activity can be managed within significant gap
of time (Rix, Wilson, Sheehan and Tujague, 2019). This is helpful in attaining research
objectives within given time period and giving significant direction to the research.

CHAPTER 4- RESEARCH USING SECONDARY DATA
Presenting findings
From the above gathered information using literature review this has been analysed that
COVID-19 has impacted the tourism and hospitality industry to optimal manner. The functional
and operational staffs of hotels have faced different uncertainties due to which negative
working environment can be created for organisational growth. Due to government restrictions
multiple challenges were seen by hospitality and tourism industry.
Figure 1 Total contribution of travel and tourism to GDP in 2020

Figure2 1International Tourism Arrivals in the UK, 2020 relative to 2019
In the light of global pandemic COVID-19 personal travel of people were reduced as
due to lock-down imposed by the government people were forced to stay at their home in order
to minimise spread of coronavirus. This has developed pressure for hotels as people cancelled
their bookings due to which businesses had to refund their money which was paid by the
customers as advance bookings (SHT, 2020). This was the major reason that hotels have
minimised with their opportunities of survival. The occupancy rate for hotel was also decreased
due to restrictions of COVID-19 and due to this overall profitability of the businesses within
tourism and hospitality industry was decreased.
.

Besides this different stakeholders of the hotel also faced numerous challenges such as
negative market image, mismanaged supply chain, issues with financial performance,
operational issues and many others. The hotels owners were needed to adopt different hard
steps in order to manage their business and to recover their cost. The businesses cut down the
pay of their employees, laid off employees, partially closed the business. COVID-19 has
created immense pressure on hospitality and tourism industry as this was the situation of crisis.
The industry of tourism is one of the sectors which is contributing to nation’s economy in high
manner so that due to outbreak of COVID-19 numerous challenges were seen by the industry
which has decreased overall GDP.
Summarising findings
Using the above gathered data this can be concluded that the outbreak of COVID-19 has
created risky situation for hospitality and tourism industry. Due to the pandemic situation
several hotels were shut down and yet some are thriving for their success. The industry has
faced issues of managing their huge fixed and variable overheads (Aburumman, 2020). As in
current time the industry is using higher technologies due to which their investment cost have
increased which has resulted higher cost of operations. In order to manage such issues the
Illustration 1: COVID-19's impact on hotel

organisation has used electronic check in and checks out system so that low contact facilities
can be given to their customers. For keeping safe environment at workplace different safety and
hygiene measures to their business so that remarkable experience can be provided to the
customers. Thus COVID-19 has given certain opportunities to the industry so that to use
advanced technology in the business so that innovation can be included in the business
functions. Certain safety and hygiene measures was also started by the industry which would be
helpful in gaining long edged sustainability.

CHAPTER 5: CONCLUSION
From the above gathered secondary data this can be concluded that outbreak of COVID-
19 has created issues for the survival of tourism and hospitality industry. These industries have
faced issues in acquiring their customers as the industry is dependent on their customers. The
major negative impact for the industry is related with minimised profitability and customer
attention. In order to deal with these issue the industry have adopted the measures to increase
cleanliness so that customer’s attention can be captured and at the same time overall customer
footfall can be increased.

REFERENCES
Books and journals
Aburumman, A.A., 2020. COVID-19 impact and survival strategy in business tourism market:
the example of the UAE MICE industry. Humanities and social sciences
communications, 7(1), pp.1-11.
Arshad and et. al., 2021. Understanding the impact of Covid-19 on Indian tourism sector
through time series modelling. Journal of Tourism Futures.
Beh, L.S. and Lin, W.L., 2021. Impact of COVID-19 on ASEAN tourism industry. Journal of
Asian Public Policy, pp.1-21.
de Vries, K., 2020. Case study methodology. Critical Qualitative Health Research: Exploring
Philosophies, Politics and Practices, pp.41-52.
Del Chiappa, G., Bregoli, I. and Fotiadis, A.K., 2021. The impact of COVID-19 on Italian
accommodation: A supply-perspective. Journal of Tourism, Heritage & Services
Marketing (JTHSM), 7(1), pp.13-22.
Hong and et. al., 2020. The impact of COVID-19 on tourist satisfaction with B&B in Zhejiang,
China: An importance–performance analysis. International Journal of Environmental
Research and Public Health, 17(10), p.3747.
Likhanov, V.A. and Lopatin, O.P., 2020, September. Methodology of research and testing of
internal combustion engines. In IOP Conference Series: Materials Science and
Engineering (Vol. 919, No. 3, p. 032011). IOP Publishing.
Mukherjee, S.P., 2019. A guide to research methodology: An overview of research problems,
tasks and methods. CRC Press.
Papanikos, G.T., 2020. The impact of the Covid-19 pandemic on Greek tourism. Athens
Journal of Tourism, 7(2), pp.87-100.
Rinjit, K., 2020. Research methodology.
Rix, E.F., Wilson, S., Sheehan, N. and Tujague, N., 2019. Indigenist and decolonizing research
methodology.
SHT, K., 2020. Impact of covid-19 on tourism industry: A review.
Škare, M., Soriano, D.R. and Porada-Rochoń, M., 2021. Impact of COVID-19 on the travel and
tourism industry. Technological Forecasting and Social Change, 163, p.120469.
Volkmann and et. al., 2021. The Impact of COVID-19 on Romanian Tourism. An Explorative
Case Study on Prahova County, Romania. Amfiteatru Economic, 23(56), pp.196-205.