Strategies for Managing Business Operations

The assignment discusses various strategies that can be used by managers in a Travel and Tourism (TUI) company to minimize the negative impact of changes in macro-environmental factors on its business operations. The strategies include customer interface quality, satisfaction, and switching costs on e-loyalty, as well as social media in tourism, travel, and hospitality. The document also references several journal articles and books related to the topic, including 'Strategic Management in Tourism' by L. Moutinho and 'Marketing in Travel and Tourism' by T.C.V. Middleton and J.R. Clarke.

The Travel and Tourism Sector

Table Of Contents
INTRODUCTION...........................................................................................................................3
Lo1...................................................................................................................................................3
1.1 key historical developments in the travel and tourism sector...........................................3
1.2 Structure of travel and tourism industry..........................................................................4
LO2..................................................................................................................................................6
2.1 Analysing the function of legal authority, government sponsored bodies and international
agencies in travel and tourism................................................................................................6
2.2 Identifying the way local and national economic policy influences the success of the travel
and tourism sector...................................................................................................................7
2.3 The implications of political change on the travel and tourism sector in different countries
................................................................................................................................................8
LO 3.................................................................................................................................................9
3.1 Factors affecting demand of products offered by Travel companies..............................9
3.2 Identifying the way supply has changed to meet the effect of demand..........................10
TASK 4..........................................................................................................................................10
4.1Evaluasting the positive as well negative economic, social and environmental effect of
tourism..................................................................................................................................10
4.2 Strategies used to minimise the negative impacts while maximising the positive impacts:
..............................................................................................................................................13
CONCLUSION..............................................................................................................................13
REFERENCES..............................................................................................................................15

INTRODUCTION
Tourism is defined as the activity which is conducted by people for variety of purpose
such as education, leisure or business. Travel and tourism industry is recognised as the
commercial enterprise which offers holiday packages as well as other facilities to the people at
specific destination. In addition to this tour and travel operators also provides several other
facilities to customers such as food , transportation and accommodation services with intention to
make tourist comfortable. Tourism activities has been executed by the people during the
traditional times as well. But with the change in time and situation there has been rapid
development has been analysed in the tourism industry. Touristy sector is contribution a lot
towards the economic and social development of nation. Tour and travel companies are
providing variety of quality services at reasonable price which has allowed firm to attracting the
more number of tourists and influence people to support growth of tourism. Tourism sector has
played significant role in promoting the destination and supported society in improving the living
standard.
The purpose of the project is to developing the history and structure of the travel and
tourism sector. It also has emphasizes on analysing the role of government in growth of tourism
sector.
Lo1
1.1 key historical developments in the travel and tourism sector
Earlier tourism activities was only conduct by people in the society mainly for the
religion purpose. The first travel activity has been executed by the Columbus sailed westward
during the 14th century and the second journey was facilitated by the Ascot Da gamma for the
business purpose. The concept of tourism evolved as earlier people travel for the search of food
and shelter. Due to the lack of transportation facilities the people in the society has to walk a
mile for the search of basic facilities. Considering the condition of the people , the government
in The European Union has decided to provide transportation facility to people which has
contributed towards the development of tourism. From that time, there has been continuous

growth in tourism sectors. As the tourism industry has supported the people in improving the
living standards and fulfilling the basic need, the tourism sector is supported by the legal
authority in nation . Earlier , travel and tour operators company only conducts the informal
tours for the visitors. During the traditional times the travel activities were conducted by people
mainly for the religious purpose with the change in social needs , trends , journey has been
executed by people for the objectives of relaxation , leisure , education etc. This factor has lead
to the increase in demand for tourism products which has allowed the firms to increase sales and
generate high profits or revenues. But the development in other things , the travel companies has
able to provide formal tour packages to the visitors. The tour operators organisation with the
support of the other sectors has form partnership with the purpose of delivering quality as well
as addition services to travellers in order to provide them comfortable as well as memorable
experience at destination. Continuous development in the economic condition as well as
technological has helped travel organisation in providing additional facilities such as online and
online booking services etc.
At the time of 16th and early 19th century there has been drastic as well as major
improvement has taken place in travel and tourism sector. In the 1841 grand tour was organised
by British elite class which has also leaded to the rise in demand for goods as well as services
offered by tour operators companies. During the traditional time tour packages were designed by
the travel organisation considering the status as well as income level of people in the society.
Tourism activities has encouraged people to improve their living standards (Jackson,2008).
Change in social trends, need has created demand for development and recreation of travel and
tourism industry. In addition to this emergence as well as development in the transportation
system such as:
Sea transport-This transportation choice was implanted in year 1831.Sea transportation option
intends to provide memorable experience to visitors.
Air transportation – This transportation facility has been provided to allow travellers to migrate
from one destination to other quickly.
With the passage of time there is tremendous improvement in the tour packages provided
by travel companies to travellers.
1.2 Structure of travel and tourism industry

Tour and travel organisation are working in coordination as well as cooperation with each other
order to provide good facilities and memorable experience to customers. Tourism sector is very
big and consists of different segments :
Hospitality- It is recognised that the supporting segment which enables travel companies to
provide basic food as well as accommodation facility to the visitors. Purpose of Hospitality
segment is to provide the optimum level of facilities to travellers .
Tour operators- These are the organisations which arranges the various facilities for the
visitors. Purpose of the Tour operators company is to provide comfort and fulfil the needs as
well as demand of tourist at particular destination. Tour operators offers different services in the
form of complete tour packages which include food , accommodation , transportation etc.
Travel agents- The function of such organisation is to provide transportation facilities for
tourist and advice them about the transport mode which can be used by them for reaching at the
particular destination.
Ancillary services- Such types of service include insurance, financial services, marketing,
guide etc. are provided by the private organisation operating in tourism sector.
Accommodation – There are different types of accommodation facilities such as villas,
cottages , hotels are provided by tour and travel organisation to visitors according to the budget.
Transportation services- Tour companies has able to provides such types of services with the
support of transportation industry. Transportation services are provided by touristy
enterprise fore allowing tourist to migrate from one place to another
(Litvin,Goldsmit and Pan, 2008). There are some transportation modes which can be used
by travellers for moving from one destination to other such as sea , road , air etc.

LO2
2.1 Analysing the function of legal authority, government sponsored bodies and international
agencies in travel and tourism.
The legal authority in the nation plays important role in supporting the travel and tourism
sector in fostering growth and accomplishing success. There are many global agencies like
regional tourism organisation, air transportation intends to support tourism sector in
expansion and achievement of objectives. Objectives of international agencies are to assist
tour operators companies in identifying the ways for minimising the adverse effects of
macro environmental factors on business operations (Heung, Kucukusta and Song, 2011). It
also intends to support business intends to support tourism companies in increasing the
sustainability in the market and gaining the competitive advantage.
International organisations have to perform different function. The important role of
tourism industry is to assist travel companies in promoting products or services, generating brand
awareness. These global agencies also support tour operator’s organisations in development of
policies. The world tourism agencies has implemented different projects for supporting the
travel sector in expanding scope of operations and delivering additional facilities to tourists at
destinations. Purpose of the project executed by the global agencies is to increase the energy
efficiency as well as renewing energy utilisation by travel companies operating on small scale.
Role of international agency is to render information, technology and other resources to Tui

company in order to help firm, in smooth functioning of business. Function of global companies
is to provide training to the employees in TUI , so that they gain the potential for delivering thee
quality and quick services to visitors or customers.
Government in the nation has enforced several policies and formulated some laws in
order to provide high level of security as well as safety to visitors. Legal authority in the country
has significant role to play in the growth of tourism . One of the crucial function is to formulate
as well as implement fiscal as well as monetary policy in order to provide financial benefits to an
enterprise operating in tour and travel industry (Christou, Sigala and Gretzel, 2012). In addition
to this role of government is to help companies in promoting products, services and destination.
Function of legal authority in nation is to provide infrastructure facility and access to the
resources which are required by an organisation in order to facilitate operation in smooth way.
There are some sponsored bodies like World travel and tourism council has aim to
promote the industry. The function of this council is to influence legal authority for supporting
the travel and tourism company. It also intends is to promote the importance of the tourism.
Sponsored bodies are provided funds by legal authority in the nation in order to support the
growth of tourism sector.
Visit Britain is recognised as the British authority..Role of this special agency is to
promote destination and helps travel companies in development of plans or strategies for
attracting visitors. Purpose of Visit Britain is to establish national tourism agency in order
to increase the value of inbound tourism (Mehmetoglu, 2014). The function of this special
council is to help travel organisation in managing their business operations and also tourist
at particular destination.

2.2 Identifying the way local and national economic policy influences the success of the travel
and tourism sector
The Different policies and laws formulated by government in the country has direct as
well as major effect on the tourism business. In UK , the several monetary and non economic
policies have been designed by the legal authority in the nation for supporting tourism sector in
fostering growth and expanding the scope of operations.

An economic or monetary policy created by the government in the country has great as
well as significant impact on the economic system of country. Integration of policies adopted by
the legal authority contributes to the economic growth of the nation which has major influence
on the financial performance and stability of firm. Economic or monetary policies implemented
in the country have helped an industry in improving the performance of travel companies in the
rural tourism. Favourable economic policy in the nation has supported business entity in
increasing its buying power and making the purchases of resources which are required for
smooth running of business (Chan and Chen,2008). It has also enabled an organisation to provide
additional facilities to customers and provided an opportunity to deliver high level of satisfaction
to client. Economic policies have positive effect on the growth of tourism sector.
Sponsorship and Funding -It is recognised as the investment made by the private or public
organisation with the objectives of making the destination more attractive to tourist.

2.3 The implications of political change on the travel and tourism sector in different countries
There are various factors such as internal as well as external constituents which has direct
as well as significant influence on the business operation of tour and travel companies. Macro
environment variables are uncontrollable nature . Some external macro environmental elements
are social , political, legal, economical , technological and environmental constituents have direct
impact on the tourism. Continuous changes in these variables have major influence on the
demand for goods or services offered by travel companies. Among various external factors ,
changes in the political changes have significant effect on the sales and profitability of travel
organisation. Wars , political in disturbances in the country restrict the visitors to visit at
particular destination. Political instability in the nation have great influence on the travellers
choice as well as behaviour towards destination.
The implication of political change on travel and tourism industry in China and UK.
United kingdom- As travel and tourism sector has made significant contribution towards
economic development of nation and generation of employment opportunities for domestic
people. So legal authority as well as political parties in United kingdom in return has made some
favourable fiscal and monetary policy for supporting travel companies in fostering growth and
expanding business operations.
China- In china, legal authority in the nation, has decided to make some norms in order to
maintain stability in the nation and support travel companies in influencing people to visit
at particular destination. Political parties in the nation, has forced government to make visa
process simpler (Middleton and Clarke, 2012). As this will help travel and tourism
companies in expanding business operations. Changes in the political factors have direct as
well as significant effect on the policies of travel and tourism companies. The unethical
political practices in the nation increase the risk or threat to the life of visitors.

LO 3
3.1 Factors affecting demand of products offered by Travel companies
It is very important for manager in travel company to develop the understanding about
the several elements which has direct as well as major effect on the demand of products or
services offered by an organisation. As this strategy will assist business entity in making the
proper plan for reducing the negative impact of macro environmental factors on business. It is
required by the marketing manager in an enterprise to conduct market audit , as this tactic will
assist marketing manager in analysing the factors which can increases the chances of risk as well
as uncertainties in business. It will also help a firm in identifying the several business
opportunities.
Economic factors- The changes in economic policies and condition of the nation has the direct
as well as major effect on the financial performance of an organisation. Economic variables such
as income level of person has great influence on their buying pastern as well as behaviour. These
constituent also have impact on the buying power of an enterprise. The decrease in the exchange
in United Kingdom has provided the TUI with transactional benefits. In addition to this
desecrate in the tax rate by government has supported business entities in increasing the profit
margins. It has also allowed firm to increase the demand for their product by decreasing the price
of goods or services.
Geographic factors- It includes the location where the travel; company is located. Geographical
elements also involves the environment , availability of resources etc. Lack of sufficient
resources might create the challenges for firm in terms of maintaining the balance between
demand and supply. Bad weather condition in the country may create barriers for an organisation
to deliver services to visitors at particular destination.
Political factors- These are the variables which has direct as well as significant influence on the
demand for the product or services offered by travel companies. Unfavourable political condition
in the nation. As per the regulation form by political parties in United kingdom , it is required by
TUI company to reduce the costs of products., as without this activity increasing the demand for
products or services.
Destination – The management of destination is very much important in order to attract more
number of visitors. As destination management will help tourism industry in the expanding the
current capacity factor.

Personal factors- This variable includes income level of an individual , interest, experience at
specific place , attractiveness of destination , availability of transport facility etc. it is required
by management team in TUI to concentrate on maintaining the quality of services or product. As
this strategy will help business entity in increasing the demand.
3.2 Identifying the way supply has changed to meet the effect of demand
Supply is defined as the those actions which are involved in distribution of product and
services so that demand and consumption of tourism can be meet. It is required by the
manager in TUI plan to formulate suitable strategies or plans in context of maintaining the
balance between demand and supply. Business entity should make improvement in supply
chain and concentrate on logistic management. As this strategy will help an organisation in
fulfilling the demands of customer on time. Supply chain management will assist an
enterprise in getting the regular supply of raw material. There has been major changes has
been facilitated by Tui in its supply chain management system. The various types of
resources of resources are required for supplying the products or services to customers such
as human resource, technology, other equipment etc. In addition to this resources such as
infrastructure, transportation etc. Tourism supply chain indicates the way various travel
companies enter into contractual agreements in order to supply products or services to
tourists. There are big number of supplier in tourism sector which help business entities in
delivering the products and services. Products or services are offered or distributed by
travel organisation with the support of tour operators. There are mainly four elements in
tourism supply chain management such as distributors of information, supply of tourism
services, consumer and travel intermediaries (Molz, 2012). In addition to this the other
component of supply are natural resources which includes awareness about environment,
eco tourism etc. Man made resources which involves recreational facilities, disposal
system , roads etc. Transportation facilities or services are recognised as important factor in
tourism sector. As it allows tourist to migrate from one place to another.
TASK 4
4.1Evaluasting the positive as well negative economic, social and environmental effect of
tourism

In developing nation like United Kingdom, tourism sector has provided various social and
economic benefits to the people in the society. Tourism industry has contributed a lot towards the
economic growth of United Kingdom and has generated the employment opportunities to people.
It has also provided the additional source of income to the government. Besides the positive
impact tourism also have some negatives aspect also. One of the adverse effects of tourism is
that the large flow of tourist at specific destination may lead to the increase in pollution. Increase
in touristy activities might result into depletion of natural resources. Some of the other positive
as well as negative effect of tourism are:
Economic impact Tourism sector has generated the various employment opportunities for
domestic people in the society. It has also supported the government in generating the more
income. It has been analysed that the money spend by the people has multiplier impact which
further results into job creation. A tourism sector also helps other small medium organisation in
increasing their sales and profitability. The legal authority in the nation can generate revenue in
form of taxes which can further utilise for the development of nation.
Tourism sectors provides jobs to [people but employees are paid less. The major
drawback or disadvantage of tourism is that in order to promote the destination , legal authority
in the country has to make huge capital investment and funds are also used for the improvement
in historical or other destinations. The excessive use of financial resources might have negative
effect on the financial stability of nation. Expenses made on the promotion of tourism products
or services and development of infrastructure are recognised as the burden on the legal authority
in nation.
Social impact:
The tourism encouraged people to improve their living standards. It also assists society in
promoting the culture and tradition. Tourism industry also provides people an opportunity to
develop the understanding about the other cultures and allows them to learn to respect other
values and beliefs. It also enables people to reduce cultural differences. Tourism also contributes
towards reduction of poverty in the country.

The negative effect of the tourism are increase in criminal activities, overcrowding, etc.
Many infrastructures are utilised for construction of hotels due to which many domestic
people has to migrate to other place (Moutinho, 2011)
Environmental impacts:
The tourism activities has direct as well as significant influence on the quality of
environment. As continuous rise in the flow of tourist and execution of several activities by
visitors can lead to the pollution. There is high threat of depletion of natural resources.
The positive impact of tourism is that one type of touristy such as eco- tourism assist
society in promoting conservation as well as preservation of natural resources as well as wildlife.
Incomes generated by the travel and tourism companies’ supports government in maintaining
marine parks, animal preserves and other historical places or destinations. In addition to this
tourism also provides various other additional benefits which can be utilised for improving the
sustainability of environment.

4.2 Strategies used to minimise the negative impacts while maximising the positive impacts:
There are many negative impacts based on the social ,economic and environmental factors
which affect the tourism sector in so many ways. First of all, the company should frame
out a plan to attract tourists from different placed and countries. This has to be done by the
government by implementing new strategies for the tourism. The TUI company needs to
operate the management team to build a team whose focuses to increase the tourist rate in
the countries. For example, TUI group should give some attractive plans and offers which
attract tourists to come there. For this the TUI group can do partnership with different other
companies to expand their business in different countries as well. This will also ensure that
their profitability rate is also increasing ( Puzakova, Kwak and Rocereto, 2009). As a result
of this the business of the TUI group can achieve their target goals and can make good
revenue from it. Doing market research will help the TUI group to plan their strategies
according to their customers needs and interests. This will ensure to them whether they
doing right planning or not. Company should do promotional events in order to aware the
public about their new services and products they are launching in the market. This will
help to maximize the positive impacts towards the company. This will lead to build a good
reputation and brand name among the customers. Interacting with customers directly or
indirectly will through various media will be beneficial for them to increase the tourism
among the people. Applying all these factors in the company will make them to stay in the
market in top positions and they can compete with their competitors in a better way.It is
required by the government in the nation to develop the certain norms or regulation for
controlling tourist activities. TUI Company should have focus on ensuring the sustainable
business practices. As this strategy will help firm in eliminating legal obligation and it will
also help in improving organisational performance (Yoo and Gretzel, 2011). By conducting
the sustainable business practices affirm will get an ease in gaining the customer loyalty
and influencing people to buy companies products or services.
CONCLUSION
Report has concluded that among several industries, the tourism industry is growing at very
rapid rate. Diverse culture is considered to the major factors which influence people to
travel. Study has highlighted the several macro environmental factors which has direct as

well as significant influence on the demand and supply of tourism products or services .It
has also been concluded from the assignment that tourism industry has contributed a lot
towards overall development of society as well as nation. It has been concluded from the
report that tourism industry generates disposable income source for the local people as well
as the government in the country. The tourism sector has wide scope of growth in the future
as well. Project has successfully explained the history as well as structure of tourism. It has
also provided the detail about the way social, economic , political and environmental factors
have effect on tourism.
There are several strategies has been suggested in the report which can be used by
manager in TUI company. As this techniques or methods will help business venture in
minimising the negative effect of changes in macro environmental factors on its business
operations.

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