Strategic and Tactical Decisions in Tour Operations: A Report

This report provides a detailed analysis of the tour operations industry, focusing on the impact of current and recent trends and developments. It examines the roles and responsibilities of tour operators, including the planning and delivery of tour packages tailored to customer preferences and budgets. The report analyzes the effects of trends such as increased internet dependency and the rise of customized packages, as well as the strategic and tactical decision-making processes involved in tour operations, including pricing strategies, product choices, and distribution channels. A comparison between TUI and AITO is provided. The report concludes with a summary of the key findings, emphasizing the importance of adapting to changing customer demands and external environmental factors for sustainable tourism development.

Tour Operations
management

Table of Contents
INTRODUCTION...........................................................................................................................3
Learning Outcome 1........................................................................................................................3
A: Analyse the effects of current and recent trends and developments on the tour operators
industry........................................................................................................................................3
B. Analyse recent trend................................................................................................................5
M1: Reasons for the changes as well as their effects on tour operators......................................6
D1. Conclusions about the benefit or otherwise of these changes for the tour operations
industry as a whole.......................................................................................................................6
C: Evaluate strategic decision and demonstrate in-depth understanding of different decisions .6
D: Tactical decision that tour operator make at different situation.............................................7
E. Conclusion and summarisation of learning............................................................................8
CONCLUSION................................................................................................................................8
REFRENCES...................................................................................................................................9

INTRODUCTION
Tour operation is the most evolving sectors that fall under the travel and tourism industry
due to which it immensely contribute in the economic development of the country. The role of
tour operation is to offer the desirable travelling experience to the public who participate in the
packaged tours or love travelling and exploring new places (Allahyari, Salari and Vigo, 2015).
Tour operator of an organisation are responsible to plan and deliver the tour packages based on
the convenience of people. These arrangements are tailored as per the interest, choices as well as
budget of the client. Accordingly different options are provided to the customer, as this help
them to land up into final decision which is favourable for the traveller as well as company. As
per the scenario tour operation is specialised in the “solo trips” where traveller prefer travelling
alone and build up their own experiences. This report cover topics like the deep understanding of
the tour operator industry within travel and tourism sector. Further, understand the strategic and
tactical decision making which is required for the tour operator are covered in the report.
Learning Outcome 1
A: Analyse the effects of current and recent trends and developments on the tour operators
industry
Tour operators are responsible to carry out the packaged holidays for which it even
prepare the brochures with the purpose to promote its offerings, holidays as well as itineraries.
This appeal the interest of the national as well as international tourism to enhance foreign
exchange that uplift the overall economy. So the role of tour operator highly provide
convenience to the guest because all the activities like reservation on flight, booking rooms as
well as availability of the guide, food and beverages are done by the operation in behalf of the
customer.
The travel and tourism industry is the widely preferred sector as it is responsible for
the moving of guest to the different locations or from one place to the other. With the change in
trend most of the people prefer to investment and become the part of such industry which include
the facilities of hotels, accommodation, viewing tourism attraction points and so on. This
basically build up the new experience of traveller and help to refresh themselves from the
boredom routine or tough schedule (Chon and Yu, 2012).
Comparisons between TUI and AITO outbound tour operator

Basis TUI AITO
Activities Tourism Union International
which is the one of the largest
tourism company that cater the
tourism of wide developed
market that is North America
and Europe. It perform various
kinds of activities for the
convenience of customer such
as scheduling the airlines
booking, organisation
packaged holidays, offer the
hotel and resorts services as
per the budget of traveller and
cruise lines.
Association of Independent
Tour Operator is the small
outbound tour operator that
provide the services within
UK. It too involve attractive
activities like arranging the
safaris or sports rides, offering
adventurous trips, fly drive and
take the adequate initiatives for
the sustainable tourism
(Deresky, 2017).
Structure TUI has adopted the new
structure that is full integration
of the tour operating activities,
hotels or resort and Cruise
ship. Such full integration
helps to develop the flatter
hierarchical structure that
allow the internal management
staff to smoothly carry out the
different operations in order to
make it more flexible (TUI
Group – New Tourism
Organisation Structure and
Board Changes. 2015).
AITO has adopted functional
structure under which different
responsibilities are delegated
to the staff such as tour
operator or guide on the basis
of their skill for the
convenience of customer

Contrast
 Whether it is major tour operator like TUI or small operator AITO, both function for the
convenience of traveller and to provide them, life long memorable experience.
 Although different combination of services are deliver by these companies to the
customer like Cruise ship by TUI and fly drive by AITO to gain huge profitability and
expand its size that encourages the tourism activities and foreign investments.
B. Analyse recent trend
The role of Tour Operator is very challenging as they need to anticipate the external
environment and bring out the vital changes accordingly. Initially people used to find investing
in tourism activity as the waste of money because they only get the opportunity to experience
one time happiness. But now the attitude of people have immensely changed for the tourism
activities like people belonging to different ages group as well as social class prefer becoming
the part of the tourism industry (Guo and He, 2012). The target market prefer distinct trips like
adventure, solo trip, wide spouse or family to get the time for them and their loves ones. Thus the
effect of the current trends on tour operators are discussed below:
Increase dependency on Internet: Internet is explored by almost all people within the
economy that help to gain the world wide knowledge and maintain the social contacts. So the use
of digital media and commerce sites is to share the vital details, images, feedback of people
based on their past experience, video clips as well as contact details. This led the client to make
the vital decision based on the comparing various e commercial website in order to land up in
final decision. Along with that the economic factor such as imposition of discount on the
different packages via online platform has boost up the involvement rate of tourism all around
the world.
Wide availability of customised packages: This is the other trend which has encouraged
the wide audience. As the tour operator provide wide services so the tourism can either add or
subtract the services they like on the basis of their interest or investment on trip. These
customisation packages have successfully helped to cover the wide global market based upon
different taste or likings of the customer. For instance, the increasing trend of the fly dive or
cruise ride have encouraged the tour operator to add such options in order to appeal the interest
of traveller.

M1: Reasons for the changes as well as their effects on tour operators
Tour operator are responsible to continuously change its services with the motive to serve
the existing or current requirement of the customer by making the desirable strategies effectively.
The tourism packages as well as expansion effect continuously changes due to the various
reason. One of them is digital platform that involve huge customer traffic and encourage them to
gain the value via online platform (Jaafar and Maideen, 2012). This let the company to use the
social media site, SEO or website to promote the offerings of company and gain the interest of
wide market. Along with that the various tour operator like TUI review the feedback of customer
and bring the alteration by keep on modifying its services, For instance, inclusion of cruise
service has helped the company to gain wide audience.
D1. Conclusions about the benefit or otherwise of these changes for the tour operations industry
as a whole
Tour operator industry are responsible to deliver the immense services to customer like
related to hotel, travel, food as well as accommodation. So it need to keep understanding the
requirement of customer and bring the significant alterations (Ronen, Pliskin and Pass, 2012).
Customised packages is the great options which is opt by TUI as the preferences of people in one
geographical area differ from the other. So based on this packaging they can add the service
which they prefer buying.
C: Evaluate strategic decision and demonstrate in-depth understanding of different decisions
Strategic decision making encompasses the required procedure and courses of actions
that is required to attain the long term goal by undertaking decision effectively. There are various
decisions which need to be taken by tour operators for either mass market or niche market in
order to carry out suitable performance of the firm. Hence, the prominent decision which are
made for both major and small tour operator are discussed below:
Pricing strategies: This strategy is used to set the prices of service for which most of the
tour operate whether large or small set competitive pricing strategy. Decision are made to
effective design the different holiday packages and promote them by giving discounts, loyalty
card to retain the interest of existing traveller.
Surcharge policy: Within this policy the tour operator enhances the basic prices of the
different services due to the peak season. This technique can help the firm to gain additional
revenue.

Product choice: Mostly the major tour operator can get the advantage of economics of
scale in order to offer wide range of services. Such pools of options helps the customer to
choose collective service and make best possible package on the basis of their preferences.
Distribution channel: It refer to the way that help to deliver the services from the
company to ultimate customer. There are different distribution channel that possibly help to meet
the customer requirement. It include the role of online travel agencies and government website.
Along with that concierge services basically assist the guest to make the reservation in hotel,
event, spa and transport in behalf of customer.
D: Tactical decision that tour operator make at different situation
Tactical decisions are made by the firm for short tenure which is not more than one year.
It ensure that the firm make suitable policies for carry the operation and planning out the
activities for tours effectively. Thus, the tactical decision prepared by the TUI are stated below:
Tactical responses: As travel and tourism business take place in the dynamic
environment which changes due to the impact of external factors. This makes it vital to prepare
the tactical strategy within tourism sector periphery. Thus, this let the tour operators of TUI to
anticipate the internal and external environment of different geographical and bring the
amendments. Otherwise, the profitability of whole business will drop down and adversely affect
the business operations (White, 2016).
Tactical pricing: While brining the possible changes the tour operator need to set the
price accordingly. For instance, TUI company during the time of vacations, festive season as
well as peak season when the demand of traveller is high the company for the short tenure
increase its price. Similarly, during off-season TUI offer wide and packaged services at a very
cheap prices. Therefore, it is vital element that need to be focused by the tour operator
effectively.
Tactical marketing: It involve the promotional strategies such as preparing brochure and
pitching the target market through customised advertisement. These advertisement are prepared
to spread the awareness amongst the customer regarding the trip as well as discounted prices at
which it is offered to the customer for specific duration.

E. Conclusion and summarisation of learning
It has been summarised that the tour operator look after the need of customer by
explaining them about the trip as well as giving them the different packages on the basis of their
preferences. As the interest of the traveller keep on changing so the organisation whether it
target to the niche area or mass area must understand response of customer and bring up the vital
changes to sustain the pleasure of people (Yan and Ho, 2017). For instance, when TUI add the
cruise service then it influence the customer to become the part of company and enhances their
profitability. So by analysing external environment changes need to be bought up for sustainable
tourism development.
CONCLUSION
From the above report it has been concluded that Travel and tourism industry is growing
and developing with the great pace that help to enrich the overall economy. Within this tour
operator plays an immense role by preparing the customised packages for the convenience of
people and motivate them to take the action accordingly. Therefore, the strategic as well as
tactical decision need to be adequately taken by the organisational for the sustainable
performance of business.

REFRENCES
Books and Journal
Allahyari, S., Salari, M. and Vigo, D., 2015. A hybrid metaheuristic algorithm for the multi-
depot covering tour vehicle routing problem. European Journal of Operational
Research. 242(3). pp.756-768.
Chon, K. S. and Yu, L., 2012.The international hospitality business: Management and
operations. Routledge.
Deresky, H., 2017.International management: Managing across borders and cultures. Pearson
Education India.
Guo, X. and He, L., 2012. Tourism supply-chain coordination: The cooperation between tourism
hotel and tour operator. Tourism Economics.18(6). pp.1361-1376.
Jaafar, M. and Maideen, S. A., 2012. Ecotourism-related products and activities, and the
economic sustainability of small and medium island chalets. Tourism
Management. 33(3). pp.683-691.
Ronen, B., Pliskin, J. S. and Pass, S., 2012.Focused operations management for health services
organizations. John Wiley & Sons.
White, P., 2016. Public transport: its planning, management and operation. Taylor & Francis.
Yan, L. and Ho, H.K., 2017. Impression management of tour leaders. Asia Pacific Journal of
Tourism Research. 22(4). pp.422-435.
Online source
TUI Group – New Tourism Organisation Structure and Board Changes. 2015. [Online].
Available through:<https://www.tuigroup.com/en-en/investors/news/2015/regulatory-
announcements/20150512-1>