Case Study Report on TUI: Impact of Covid-19 and UK Government's Recovery Plan on Business Environment

This case study report analyzes the impact of Covid-19 and UK Government's Recovery Plan on TUI Group's internal and micro environment, and the STEEPLE factors affecting its operations.

Business
Environment

Contents
INTRODUCTION...........................................................................................................................4
MAIN BODY ..................................................................................................................................4
Section 1...........................................................................................................................................4
Summary......................................................................................................................................4
Section 2...........................................................................................................................................5
The impacts of the Covid-19 Pandemic on TUI Group’s internal environment..........................5
The impacts of the UK government’s recovery plan on TUI Group’s internal environment......6
Section 3...........................................................................................................................................6
The impacts of the UK government's recovery plan on TUI Group's micro environment..........6
The impacts of the Covid-19 Pandemic on TUI Group’s micro-environment............................7
Section 4...........................................................................................................................................7
The impact of STEEPLE factors on TUI Group's operations.....................................................7
CONCLUSION................................................................................................................................9
REFERENCES................................................................................................................................9

INTRODUCTION
Business environment is the sum of all the things that are external and internal to the
organization and businesses and which can affect the functionality of the business. Environment
study for the business is very essential for the business to know the changes occurring in the
environment and that can affect the business. The internal business environment refers to the
internal forces in the business which affects the routine activities of the business such as
customer, suppliers, employees etc. micro environment refers to the elements in a business that
can affect the business ability to serve the customers (Azam and Abdullah, 2021). The micro and
the internal environment elements can be controlled by the business. And the macro environment
refers to the elements which affects the business from outside of the organization and these are
beyond the control of any business. The TUI Group is a German based travel and tourism
company. The company is headquartered in Hanover, Germany. The company deals in the
hospitality and tourism sector and provides the services of travel agencies.. This case study aims
to analyse the organization's present situation and the impact of the UK government's recovery
plan and Covid 19 on the company's internal environment and on the micro environment of the
company. This report will also cover the analysis of the macro environment on the company's
operations.
MAIN BODY
Section 1
Summary
The TUI Group is a German based travel and tourism company. This is one of the leading
companies in the tourism sector. The company also owns many brands under it for instance
Atlanta, Barut, Blue Diamond, Gropotel etc. the company's portfolio consist of more than 1600
travel agencies, and online portals, it also have five airlines with around 150 aircraft, the
company has around 400 hotels under it and around 16 cruise liners and different incoming
agencies on major holiday locations around the globe (Chen, J., and et. al., 2021). The company
operates in more than 180 countries and it is serving more than 30 million customers. The
organization's operations cover whole tourism sector services. The growing tourism sector
helped the company to grow and it is operating since more than 100 years now.

TUI Group's main goal is to satisfy the needs of the consumers. And the main objective
of the company is to put positive impact of the travel and tourism on the travel destinations and
the people. The tourism sector covers the travel accommodation and hospitality and the TUI
Group is providing services in each sector. The company's leading position in the tourism sector
provides opportunity to their shareholders, consumer and employees also. The company is also
tagged as most trusted travel company in year 2022 (Faccio, M., and et. al. 2018).
Organizational structure
This is a framework that shows how activities are managed and directed in the
organization to meet the goals. This consists responsibilities and roles and rules. This structure
determines the flow of the information between the different levels of the organization. This
structure also helps to increase the organization's efficiency and effectiveness. The
organisational structure are divided into different types such as divisional, functional, matrix and
flat organizational structure. TUI Group follows the functional organizational structure in the
company. This organizational structure organises the company into different functions on the
basis of expertise and their skills and their roles.. This structure enables the company to focus
more on the departments and have more control on these.
The Annual revenue for the TUI Group in the year 2021 was 4731.6 million Euros
which was reduced by 3212.1 million Euros from the year 2020 annual revenue of 7943.7
million Euros. And in the year 2019 the annual revenue for the company was 18928 million
Euros. The annual report of the year 2021 for the TUI Group was prepared for the reporting
period of 1st October 2020 to the 30th September 2021. And the company has employee base of
around 57000.
The main competitors of the TUI Group are the Invited Home, Norwegian Cruise Line,
Vacatia, Ving and Starwood Hotels & Resorts etc.
Section 2
The impacts of the Covid-19 Pandemic on TUI Group’s internal environment.
The internal environment consist of the elements which are present inside of the company
and can affect the business functionality (Heripracoyo and Adi, 2019). These elements can be
controlled by the business. The impact of the Covid 19 on the TUI Group is as follows-

 The government have planned to enhance the infrastructure at different desirable
destinations which leads the TUI group to attract more and more of the local and
international tourists which will help in increasing the overall growth and generates more
revenue in order to expand its operations .
 TUI group is being benefited by the government offering flexible interest rates to the
organisation that have reduce the overall costs of the operations. The organisation will
utilise these resources in an optimised manner then will enhance its tourism volume and
visitors expenditure (Kaefer, 2022).
 The government also Provides TUI group with released and less restricted entries that
allowed free entry and trade between different regions and help in maintaining healthy
relates between different countries.
The impacts of the UK government’s recovery plan on TUI Group’s internal environment.
To maintain the growth in the tourism sector government have initiated many recovery
plans which will provide organisations with different opportunities and help to overcome the
negative impacts of different factors. TUI have suffered looses during this pandemic but with
government rules and recovery plans it is able to make its reach to different customers in rural as
well as urban areas. In order to avoid the pandemic impacts government have set up different
rulers and protocols for the safety and security of the individuals which includes maintain
distance, entry rules for passengers and more. TUI Groups have maintain their ethical practices
and follow all the rules and regulations that enables the organisation to attain sustainable
growth and help to maintain a good position in the marketplace in context to profitability and
survival. The organisation is one of the leading travel and tourism business and holds a
competitive advantage to contribute in the development of economy.
Section 3
The impacts of the UK government's recovery plan on TUI Group's micro environment
The government is supporting the tourism industry to recover from the COVID 19
pandemic with the help of recovery plan. The government is providing relaxations to reduce the
negative effect of the pandemic (Lee, C.C., and et. al. 2019). The government is supporting
companies by reducing the tax rates, which was higher before the pandemic. The government
also have reduces the interest rates to increase the flow of the currency in the country. This will

result in more loans which will increase the flow of currency. By this the customers purchasing
power will increase. The government is also promoting internal travel within the country. The
TUI Group has also reduced the packages rates and proving rooms at a lower rate because of the
tax cuts by the government. This will increase the competitive edge of the TUI Group against the
competitors. This will attract the number of customers which will help TUI Group to increase the
revenues in normal pace before the pandemic (Meurette, 2020).
The impacts of the Covid-19 Pandemic on TUI Group’s micro-environment.
The Covid 19 affected the operations of the TUI Group. The company saw the highest
decrease in the number of tourist and sales. The company has also faced difficulties in providing
salaries to the employees which resulted in decrease in number of employees. Many employees
lost their jobs. The company also faced losses as the previous booking cancelled by the
customers due to the ravel restrictions on the intentional as well as national visitors. The supplies
of the amenities provided in the accommodation rooms was also reduced as the industry was not
functioning due to lockdown in the countries. Also the Covid protocols inside the TUI Group
added additional cost for the company. The Covid 19 affected the travel and tourism industry
very negatively and harsh manner.
Section 4
The impact of STEEPLE factors on TUI Group's operations
This analysis is used to assess the impact of the external factors on the business functions
and operations. This analysis consist the 7 elements those are; Social, Technological, Economic,
Environmental, Political, Legal and Ethical. These elements are beyond the control of the
businesses.
 Social Factors- these factors includes elements such as age group, class structure,
demographics, education and culture. The company can be affected positively by the
racial acceptance around the world. Also the social popularity of travel among people is
rising. The TUI Group operates in different countries so this have a wide variety of
cultural experience to provide for the customer (Pillai and Sivathanu, 2020).
 Technological Factors- The technological effects are included in these factors. The
technology over the past year has transformed at a rapid rate. The company is also using
high level technology in the operations. The TUI Group has shifted to the digital

platforms websites listing, online payments, online booking etc. these technological
changes can affect the company positively.
 Economical Factors- These factors includes the inflation rate, interest rates, employment
rate, per capital income of the people. The Covid 19 pandemic has affected the countries
negatively and the effect can be seen on the income of the people and the countries
growth (Subramanian, 2018). The TUI Group has also been affected by this the
company's functionality. The company has reduced the employees base also. Also the
rising information can affect the company negatively.
 Environmental Factors- these factors includes the element which are derived from the
environmental effect such as climate change, reducing natural resources, weather,
recycling, air and water pollution etc. the company is negatively affected by these factors.
The TUI Group is operating in many countries and now a days the countries are
concerned with the pollution that tourist causes. This can affect the company negatively.
 Political Factors- These are the factors which comes from the effect of politics. These
elements are the fiscal policy, trade barriers, trade agreements, taxes, etc. these factors
can affect the TUI Group’s long term profitability. The TUI Group operates in more than
100 countries and this can affect the company. The travel restriction by the government
can also affect the company negatively.
 Legal Factors- These factors comes from the effect of the rules and regulation of the
legal framework of the country. These factors are employment laws, health and safety
laws, copyrights, patents, consumer protection rights etc. the TUI Group operates in
dozens of the countries so it have to comply all the rules and regulations of those
countries. This increases the cost for the company and it can negatively affect the
company.
 Ethical Factors- The ethical factors includes the people's tendencies, the value of the
people's culture, integrity, duties, and employees behaviour towards the society (Taylor
and Perkins, 2021). TUI group ensured the policies regarding the employees code of
conduct. This ensures that the management in different countries and the employees does
not disobey those code of conduct.

CONCLUSION
From the above case study his can be concluded that the business environment analysis
tells about the elements of internal and external factors affecting the business. The internal
environmental factors and micro-environmental factors can be controlled by the company but the
macro environmental factors are beyond the control of the company. The pandemic has affected
the companies revenues and operations and it was beyond the control of the company. The
whole tourism sector was affected by that. The government has tried to recover the economy by
the recovery plan. The company also has the opportunity to increase its decreasing revenue by
expanding into another countries. This will help the company to increase the customer base and
sales and to overcome the effect of the Covid 19 pandemic. It also can be concluded that the
macro environment is affecting the company in both ways positive and negative. The company
can make changes in the strategies to reduce the effect of macro environmental factors.

REFERENCES
Books and Journals:
Azam, M. and Abdullah, H., 2021. Dynamic links among tourism, energy consumption, and
economic growth: Empirical evidences from top tourist destination countries in
Asia. Journal of Public Affairs, p.e2629.
Chen, J., and et. al., 2021. Removal behaviors and mechanisms for series of azo dye wastewater
by novel nano constructed macro-architectures material. Bioresource Technology, 322,
p.124556.
Faccio, M., and et. al. 2018. Macro and micro-logistic aspects in defining the parts-feeding
policy in mixed-model assembly systems. International Journal of Services and
Operations Management, 31(4), pp.433-462.
Heripracoyo, S. and Adi, S., 2019, August. Implementation of tourism business web. In 2019
International Conference on Information Management and Technology
(ICIMTech) (Vol. 1, pp. 30-35). IEEE.
Kaefer, F., 2022. Richard Hammond on How to Communicate Responsible Tourism.
In Sustainability Leadership in Tourism (pp. 553-557). Springer, Cham.
Lee, C.C., and et. al. 2019. Stem and progenitor cell microenvironment for bone regeneration
and repair. Regenerative medicine, 14(7), pp.693-702.
Meurette, O., 2020. Shaping of the tumor microenvironment by Notch signaling. Tumor
Microenvironment, pp.1-16.
Pillai, R. and Sivathanu, B., 2020. Adoption of AI-based chatbots for hospitality and
tourism. International Journal of Contemporary Hospitality Management.
Subramanian, S., 2018. Stewardship theory of corporate governance and value system: The case
of a family-owned business group in India. Indian Journal of Corporate
Governance, 11(1), pp.88-102.
Taylor, S. and Perkins, G., 2021. Work and Employment in a changing business environment.
Kogan Page Publishers.