Impact of Covid-19 and UK Government's Recovery Plan on TUI Group's Business Environment

This report analyzes the impact of Covid-19 and UK Government's Recovery Plan on TUI Group's internal, micro and macro business environment. It includes a summary of TUI Group, its competitors, and a STEEPLE analysis. The report highlights the impacts of Covid-19 on TUI Group's internal environment, the UK government's recovery plan on TUI Group's micro-environment, and the macro business analysis using the STEEPLE analysis. It also provides recommendations to improve considering the micro, internal and macro analysis.

Business environment

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................3
Section 1...........................................................................................................................................3
Summary of TUI Group..............................................................................................................3
Section 2...........................................................................................................................................4
impacts of the Covid-19 Pandemic on TUI Group’s internal environment................................4
impacts of the UK government’s recovery plan on TUI Group’s internal environment............5
Section 3...........................................................................................................................................5
The impacts of the UK government’s recovery plan on TUI Group’s micro-environment........5
The impacts of the Covid-19 Pandemic on TUI Group’s micro-environment...........................6
Section 4...........................................................................................................................................6
Analysis of TUI group's macro business environment...............................................................6
CONCLUSION................................................................................................................................8
REFERENCES................................................................................................................................9

INTRODUCTION
In today’s era, Business environment plays a vital role as it is collection of all the
important external and internal factors such as customer’s needs, their preferences, expectations
and also employees. To be successful, every business needs to understand business environment
as it helps them to make realistic plans. By understanding these important factors an organisation
ensures their effective implementation in situation such as COVID-19 (Abbas and et.al., 2021).
The present report will be based on TUI group which is a German leisure travel agency
company. There are many types of internal environment which can impact the business and also
day to day decision-making and operations of the company internally it includes management,
culture and working of employees. While on the other hand, external environment is the group of
external factors that are situated outside the firm but affect business in some extent. External
environment includes political systems, policies made by government, regulation of the country,
society and economic condition. The report will highlight some important factors which can
impact TUI group and also provide detailed about impact of the recovery plan and covid-19
pandemic on company. Also, the macro business analysis using the STEEPLE analysis will be
done in this report. Furthermore, it will provide some recommendations to improve considering
the micro, internal and macro analysis.
Section 1
Summary of TUI Group
Business overview: TUI Group is a German leisure, travel and tourism organization of
Germany having headquarter in Hanover. The company name as TUI Group after 1997 until the
company was named as Preussag AG. This was happened when the company has changed its
business activities from mining to tourism. The portfolio of TUI Group includes 1600 travel
agencies, 150 aircraft, more than 400 hotels, 16 cruise liners etc. (Aburumman, 2020). The key
products and service of TUI Group is tour operation, travel agencies, airline services, charted and
passenger schedule, hotels, resorts etc. The key events of TUI includes new products, expansion,
merger etc. For example, the recent event of TUI is that in the year March 2022, the company
have announced its plan to expand TUI Blue hotel in Asia, Africa and the Middle East. The
business type of TUI group is corporate which operates under hospitality and tourism industry.
The legal structure of TUI group is comprises of Executive Board of 11 members and

supervisory Board of 20 members. The member and trainee are bounded to comply with the
Integrity Passport and TUI Code of Conduct as per the legal structure of company.
Size: TUI Group is one of the leading tourism business of Germany which is operated
under in more than 24 countries all over the world. The scale of operation of TUI includes more
than 400 hotels, resorts, clubs with 214000 beds. The annual revenue of TUI Group in the year
2021 is 4731.6 million dollars which is lower as compared to 2020 annual revenue of 7943.7
billion dollars. The total number of employees work with the organization is 46123 as per the
2021 report. The company is listed under FTSE 250, Frankfurt and Hanover stock exchange. The
market cap of TUI group in the year 2022 is $4.95billion (Schäfer, 2020).
Sector and Industry of Operation and direct & indirect competitors: The company
operates under hospitality and tourism industry. The direct competitors of TUI Group are
Thomas cook, Sunwing, Transat, Holidaybreak etc. and the indirect competitors of TUI Group is
Lubeck Air, Lufthansa etc.
Organization structure and Leadership team: The organization structure of TUI group is
hierarchical structure and the leadership team incudes Friedrich Joussen (CEO), Sebastian Ebel
(Member of executive) and Peter Krueger (CFO)
Section 2
impacts of the Covid-19 Pandemic on TUI Group’s internal environment
pandemic has shattered the whole tourism industry in the world, it has impacted the
internal environment of TUI group which includes management, corporate culture and also
behaviour of people (Sah and et.al., 2020). Not only this it has also impacted the structure of
organisation, its objectives and value systems.
Impact on quality of human resource- during the time of pandemic, the working of HR
department was highly impacted. Quality of employees is important for the success, as it depends
to a great extent on the attitudes and skills of its employees (Sah and et.al., 2020). Due to
changing government policies and pressure of providing employment has created pressure on
Human resource department also. The workers and staff members were highly impacted as their
performance and style of functioning was changed as per the market condition.
Technological capabilities- due to pandemic everything was running down from working
of staff members to technological capabilities of the organisation. At pandemic time, companies

who were able to provide quality service by using its technology then only they are able to
satisfy the needs of visitors and vice versa. However, Research and development of the company
determines its ability to introduce innovation which can enhance productivity of the staff
members (The impact of COVID-19 on TUI, 2022).
impacts of the UK government’s recovery plan on TUI Group’s internal environment.
Corporate culture- as we all know that culture of the company plays a vital role and is
important factor in order to determine the internal environment of the firm. with the help of
recovery plan, the corporate culture of TUI group is able to well maintained (Runte, 2019). In
addition, the important business decisions are taken by top level managers of the group regarding
the safety and precautions of visitors during and after pandemic.
Enhance the style of functioning of top level management- talking in the relation with the
functioning of the top managers, with the implication of recovery plan, the working style and
business decision making process of the managers has also increased which is better for the
reputation. On the top of that, the mission statement of TUI group has also been achieved after
the implication of recovery plan and support of top level management.
Section 3
The impacts of the UK government’s recovery plan on TUI Group’s micro-environment
The micro environment is all about the operating environment of the company. As we all
know that tourism industry is one of the fastest growing industry in the world. In this era
pandemic was the most terrific time faced by tourism sectors (Runte, 2019). The pandemic has
represented the most difficult for the tourism sector in the era of mass global tourism. Due to
this, government of UK has developed recovery plan for tourism industry.
Promoting tourism and supporting safe return of international return- The major aim
behind developing this recovery plan is to bring people together, provide them protection, inspire
the next generation (Payne, Gil-Alana and Mervar, 2021). The major reason behind developing
this plan is to get travelling again as many people around the world wants to travel and grasps the
incredible facilities and offers provided by travel companies. The company wants to make sure
that people living in the UK continue to make their destination of choice year after year.

Restoring traveller confidence- Talking in relation with the recovery plan, it helps to
mitigate the impact on jobs of people and also on businesses in some destinations. However, it
has been noted that when the international tourism return real recovery will be able to achieve in
the country. As government has stated that every travellers needs to follow rules such as social
distancing, sanitizers and safety and precautions method this leads to improvement in travelling
experience of people after covid-19 variant.
The impacts of the Covid-19 Pandemic on TUI Group’s micro-environment
Travel company has been one of the hardest hit by COVID-19. As we all know that tourism has
been restricted across the world over the past year (Johann, 2022). It has impacted supply and
demand in a negative manner. Not only this, the covid-19 pandemic has also shone a greater
light on the barriers holding the tourism company like TUI back from reaching its full potential.
The employees and culture of the company have faced lot of pressure during the pandemic time.
Consumer uncertainty was one of the biggest challenge and barrier faced by the company (The
impact of COVID-19 on TUI, 2022). As making relationship with employees, suppliers and
consumers is crucial for successful business. However, due to covid-19 these micro
environments were highly impacted in terms of demand. The lack of demand was the major
problem faced by this travel operator.
Adjusting to a new normal- in the mid of year 2020, there was an increase in the negative
impact of lockdown on the travel industry. People were not allowed to visit from one place to
another, however after few days’ countries started looking for a balance and employees,
management and culture were also adjusting to a new normal (Runte, 2019). Operational
activities were followed by remote work as everything was available online to maintain social
distancing and gain sustainability.
Section 4
Analysis of TUI group's macro business environment.
Let's analyse the macro business environment of TUI with the help of STEEPLE
analysis. Steeple analysis includes 7 factors of macro environment such as social, environment,
economical, technological, legal, ethical and political.
Social: Society's taste, preference, age, lifestyle affects the working of the organization in
the environment. Marketers at TUI undertake efforts to understand the leisure interest of

customers to know the market and place the products accordingly. Recent shift in customers
preference due to covid-19 has impacted the operations of business.
Technological: Technological advancements have revolutionized the tourism industry.
Facilities like online bookings, easy cancellations, refunds, etc. have been made easy for
customer satisfaction. These factors have induced the revenues as well, because of the easy
access available to the customer.
Economic: factors such as taste, preference, gender, age, lifestyle changes etc. affects the
way business at TUI group operates. Recent shift in customer's behaviour towards healthy food
and hygiene due to covid-19 made the industry has better healthy food option and maintenance
of hygiene at hotels. Economic factors are often the game changer for the organization as entire
business revolves around the customers need and wants from the TUI.
Environmental: different environmental standards which needs to be followed by the
company affects the profitability of the organization. The recent shift towards zero waste and
reduced carbon footprints has changed the way TUI operates, as database of customers is kept
online, TUI has adapted measures to reduce the carbon footprint.
Political: the recent political action taken by the UK government to take an exit from
European union which is popularly known as the Brexit, has impacted the working of the
company in terms of increase in cost for tourist from different locations in Europe. As cost for
the customers from various locations outside of the UK has increased due to trade barriers.
Legal: factors like various norms and policies related to health and safety implemented
by the government on the tourism sector has affected the company as well. It has made the
business operations a costly affair and the cost of end product became really high.
Ethical: the values and standards of the various customer which comes from the different
backgrounds and cultures should be effectively incorporated in the way customers are treated as
this could leave an everlasting impression on the customer and factors like this often define the
customer retention in the industry.

CONCLUSION
To conclude, covid-19 has impact businesses in the past years. The present report has
concluded about the impacts of covid-19 on the business and it functioning. As people were not
allowed to travel from flights especially international flights arrivals have been down 90% for
over a year compared to 2019 levels, it was mandatory to established some sort of solutions such
as recovery plan in order to provide support to people and businesses both at the same time. With
the implication of recovery plan, the internal and micro environment was well organised. the
pandemic has also highlighted how much we owe the 1.7 million people in the country directly
employed by travel industry in the UK areas. this was the major reason to implement recovery
plan for the betterment of people. In order to cope up with pandemic situation and decline in
profits and performance issues, the government is determined to help the world class tourism
sector of the UK as quickly as possible with a full return through recovery plan. The success of
this recovery plan for TUI group is all about the support of government who is committed to
provide benefit to tourism sector so that it will emerge from the pandemic to become more
sustainable and innovative.

REFERENCES
Books and Journals
Abbas, J. and et.al., 2021. Exploring the impact of COVID-19 on tourism: transformational
potential and implications for a sustainable recovery of the travel and leisure
industry. Current Research in Behavioral Sciences. 2. p.100033.
Aburumman, A. H., 2020. The concept of global governance in tourism franchises: a case study
of TUI group. Entrepreneurship and Sustainability Issues. 8(2). p.1321.
Baum, T. and Hai, N. T. T., 2020. Hospitality, tourism, human rights and the impact of COVID-
19. International Journal of Contemporary Hospitality Management. 32(7). pp.2397-2407.
Johann, M., 2022. CSR Strategy in Tourism during the COVID-19 Pandemic. Sustainability
2022. 14. 3773.
Payne, J. E., Gil-Alana, L. A. and Mervar, A., 2021. Persistence in Croatian tourism: The impact
of COVID-19. Tourism economics, p.1354816621999969.
Runte, C., 2019. Corporate Social Responsibility Management in tourism business: The impact
of TUI Group and Intrepid Group on low-and middle-income countries.
Sah, R. and et.al., 2020. Impact of COVID-19 on tourism in Nepal. Journal of Travel
Medicine. 27(6). p.taaa105.
Schäfer, J. C., 2020. The case of TUI: sailing into a bright future or sinking like Thomas
Cook? (Doctoral dissertation).
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.
Online
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