TUI Group: Management Models, Organisational Structure and Environment

This report provides an analysis of TUI Group, a travel and tourism company, focusing on its management models, organizational structure, and internal and external environmental factors. The report begins by exploring various management models such as the rational goal model, internal process model, human relations model, and open system model, linking them to TUI's operations. It discusses TUI's organizational characteristics, including functional, divisional, and flat structures, and how these relate to the chosen management models. The report further examines TUI's micro and macro environment using PESTLE and Porter's Five Forces analyses, assessing the political, environmental, social, technological, legal, and economic factors impacting the company. The analysis aims to provide insights into TUI's strategies for achieving its objectives and maintaining a strong performing organization in the competitive tourism industry.

Business and tourism

Table of Contents
INTRODUCTION ..........................................................................................................................3
MAIN BODY...................................................................................................................................3
TASK 1............................................................................................................................................3
Management and its model.........................................................................................................3
Explantation of TUI group and their operations:........................................................................4
Organisational Characteristic in relation with models: ..............................................................5
Similarities between models and organisation: ..........................................................................5
Task 2...............................................................................................................................................5
REFERNCES:................................................................................................................................10
Books and Journals:..................................................................................................................10

INTRODUCTION
The report has aims to provide understanding of various management models and
organisational structure which helps in achieving desired objective and enable effective decision
making. These models are name as internal process, rational goal, human relations models and
many others. Also, organizationals structure defines set operations and regulations to work in
desired manner (Boros, 2020 ). The report is considering Hotel TUI group, it is a travel and
tourism provider. The company was established in the year 1923. The group owns hotels,
airlines, retail shops, resort and cuisines. The company serves hospitality services across the
Europe. The report is going to going about management models, organisation structure and
characteristics and company operations in Task 1 and Task 2 will be about is analysis of both
internal and external micro/macro environment factor through Pestle, porters and Swot analysis.
MAIN BODY
TASK 1
Management and its model
Management defines as the administration of an organisation in which process is laid for
managing people and resources. It plays a vital role in order to carry out business function in a
well manner. Maintaining relations, utilising resources, planning the goals and monitoring
performance are the major functions of management. Without management, organisation would
not be able to deal with uncertainties and may suffer from losses. There are various models and
theories of management which are discussed below:
Rational goal model: As per this model, the managers keep products on productivity and
effectiveness working of human resource. Organisation aims is to attain competencies by taking
first mover advantage into market. The main elements which are found to be effective for
enhancing productivity are financial capability, technologies and time and motion techniques.
TUI needs to use time and motion studies in which the managers will identify time taken by each
activity for planning travel packages, enabling hotels services, research and marketing.
Internal process model: As per this model, the managers focus on making internal
operations effective. Internal elements include human resources, power, authorities and
responsibility which must be maintained in a hierarchy. TUI needs to enable proper chain of
command and authority delegation to empower internal operation of company.

Human relation model: This model of management emphasises on building employee
relations at workplace. The more relations will be maintained, the more it will lead to effective
working. There will no organisation disputes, bias and personal grudges. The manager of TUI
Group must maintain human relations by giving motivation, engagement in group activities,
authorities and team building will increase understanding among peers. As hotels require to
provide quick and reliable service which would only be possible through maintaining
coordination and communication.
Open system: This model is about creating open working environment into organisation
by focusing on innovation, sustainability and empower creativity into organisation. Managers
need to provide free environment of participation to acknowledge employee’s talent and provide
them opportunity to explore and develop creative work mind. TUI group needs to provide open
system working which enables organisation growth and result in competitive advantage.
Explanation of TUI group and their operations:
TUI group is a well reputed travel and tourism industry which provides all the areas of
tourism and hospitality services through hotel, cuisine, resorts, airlines and retail sector as well.
The company serves their operation across the Europe by owing 380 hotel and resorts. Also, they
have operated 5 airiness craft in their ownership. The company comes under London stock
exchange in which shares and financial capital are decided and raised to market level (Tinnish, ,
2017).
The company operations are discussed below:
Hotels and resorts: TUI groups have approx. 400 hotels across the country which
regulates on the basis of different market demand and customer needs. The company maintain
standards and quality services. (Cunha, Kastenholz,and Carneiro, 2020). The hotels are located at
the heart of the cities which provide conceivable facilities to travellers. Hotel consist rooms,
dining, ambience, entertainment, gym, pool and events and many other facilities with set
standards.
Cruises: TUI group provides extra services to enable current trends into organisation.
The cruises are famous for international tourists which attract current youth. Therefore, TUI is
known for luxuries premium voyages through Europe to German. Their cruise considers seven
vessels in which Marella Cruises are one of the cruise lines which is extremely taking growth
in British market.

TUI amusement: TUI provides amusement services in across 140 countries which
includes fun and recreational activities.
Airlines: TUI group holds five airlines craft and it covers various destinations into 180
countries.
Therefore all these operations are the reason for TUI growth and development. It enables
expansion and more market reach into travel industry.
Organisational Characteristic in relation with models:
TUI group is the leading tourism sector that operates at different location which requires
efficient and effective working to enable high standard services and maintain smooth internal
operations. Therefore, the company follow different organisation structure and has different
characteristic which are defined below:
Functional structure: In this structure, people are divided under their functional categories. In
simple words, employees assigned work as per their area of specialisation. TUI group operates
this organisational structure, as employees are divided in marketing department, human resource
and finance to take quick decisions as they all belong to same field of working.
Divisional structure: The Organisation works under this structure in which, job roles are
divided as per authority delegation. TUI group involves divisional working in order to assign
work as per departmental needs. Manages are assigned to each departments for providing
guidance and monitoring the performance. For instance, planning wedding events in which
Chefs, event managers, and support partners gets into divisional activities which maintain
smooth and valuable working.
Flat organisational structure: This structure is applicable in small business organisation where
employees do not get any orders from managers. Employees work freely and take decisions as
per their own. TUI does not follow this structure as hotels require proper control and expert
decision making.
Organisation characteristics:
 TUI group has great reputation into market as it is the leading agency of online platforms
to provide aircraft, hotels, cruises and resorts. Therefore, the company follow rational
goal model to be competitive into market by using modern technologies and mange work
with time and motion techniques (Runte, 2019).

 The company maintain sustainability standards which is a key feature of their immense
growth and profitability. As TUI group works as per internal process model, Employees
gets trained in such a manner that promotes sustainable operations by reducing wastage,
recycle and re-use.
 Employees of TUI are professional and enthusiastic to keep the working environment
fruitful and follow set rule. It defines that, human relations are effective in the company.
Similarities between models and organisation:
organisation structure and models are similar in practical application, as both of these
aspects focus on smooth functioning of organisation and enable great profitability(Dimitriou,
2017). Management models require great control and human relations to avoid disputes and
misunderstanding which promotes divisional organisation structure that assign works as per
employee specialisation and managers undertake full control over their activities. It has
identified that, both organisation structure and models are similar to the context of achieving
goals and objectives to perform internal and external crises in a better manner.
Task 2
Aims: TUI aims to provide sustainable and fruitful experience by exploring different culture and
counties to the employees and customers.
Objectives: The company wants to achieve 20% more sales till the year of 2022(Fitchett, 2021).
Analysis of micro and macro environment:
Micro and Macro environment are both necessary to analyse as they both impact on
business environment directly or indirectly. These both are described briefly:
Micro environment: it is known for internal environment of organisation where business is
affected with its regular practices. Micro environment is not broader concept but is necessary to
look for maintaining business performance. This include suppliers, competitors, customers and
intermediaries.
Macro environment: this environment is put great influence on organisation profitability and
working. As it is wide concept which require proper planning and knowledge of external factors.
A business could not neglect the seriousness of macro factors who aims to survive for long term.

These factors could be social, environmental, political, economical and other external market
intermediaries.
Pestle analysis
It is a framework which helps in analysation of macro environment factors in a broad
context. A company is surrounded with various external circumstance that somehow impact on
global serving of business. The negative an positive impact of macro factors are described
below:
Political: A Business works under the forces of political power and interferences which
impact on organisation profitability and performance. Taxes, excise duties, terrorism are the
major concerns for travels and tourism industry as they operate to work for national and
international level. The environment is dynamic, political policies and rules are also gets change
with the flow of environment necessity. Hotel TUI group suffers with political instability due to
which they inbreed to prepare with requirement plans and strategies to dismiss negative impact
of this factor from the organisation. Main areas which required political stability are trade fair,
intellectual property rights, licensing and others.
Environmental: environment is considered as most vital factor which must be safe and
secure to enjoy well existence of organisation. A business is highly affected with environmental
stability which impact through business practices. Pollution, hazardous gases,carbon emission
are the main cause which makes the environment impure. Therefore, hotel and travel industry
works for maintaining the beauty of nature that attract many tourist. So that, Hotel TUI group
has engaged in eco-friendly activities through recycling, reusing and reducing carbon emission
up to 70% (Lin, Chen, and Filieri, 2017).
Social: A business creates its image to gain customer attention, trust and retention. Social
factors consist all these element which must be enable to create positive image on company.
Hospitality industry regulates services and customers make judgements on behalf of the same.
Therefore, being effective and fruitful to identify market trends and present social norms, values
and beliefs into organisation, Hotel TUI has reaching to height of success by providing quality
and standard into their service. The company enables all the market trends while making
strategies for attracting customers but needs to put more focus on customer segmentation so that
both rich and poor would enjoy hotel services.

Technological: Technology is major concern for every organisation as the current time
require easy and quick services which boost growth of company as well and nation. Hospitality
industry works on broad level that require effective software, machinery and updated
technologies. Hotel TUI enables digitalisation in hotel services by online payments, bookings,
CRM, Website search and AI.
Legal: legal interferences are most vital factors which needs to take into consideration
for. These legal laws influence on organisation both internal and external practices by focusing
on employees and customer well being. Therefore, TUI operates all the laws of equity act,
health and safety, environmental protection and customer protection.
Economical: Hospitality and tourism sector is one of the industry that develop economic
stability by empowering demand and supply, technological advancement, employment
opportunities and other factors. This industry has positive impact of economic factor but due to
crises of Covid-19 , it lays decline into sales and consumer purchasing power. Hotel TUI needs
to have competitive and customer-centric approach to operate demand for travel and tourism.
Porter's five forces analysis:
Threat of new entrants: This force emphasize on arrival of new business onto existing
market which may grab opportunities, market trends and customer attention. hospitality industry
require huge investment, capital and brand name due to which no firm could easily enter into
market. Therefore, TUI has low threat of this market force as travellers prefer to opt reputed
hotel to enjoy their travel.
Bargaining power of buyers: this force analyse potential customer and their demands
from the organisation. Buyers believe in check for best option and opt which gives money worth
satisfaction. In hospitality and tourism industry, buyers may have high bargaining power due to
have many option sand similar services. Therefore, organisation needs to have unique product
and service which minimise impact of buyers bargaining power. TUI has low impact as their
services are more superior and customer centric which customer crave and appreciate for while
travelling to different country or nation.
Bargaining power of suppliers: supplier bargaining power creates negative impact on
business organisation as, resources and materials are depends on their availability. Therefore,
hospitality industry has low threat of this force due to having global availability of supplier. Soi
that, TUI also does no need to bother about this factor as the company purchases material from

different suppliers across globe by making secrecy contract. These suppliers could not bargain
with reputed firms to not loose their profitability.
Availabilities of substitutes: This force emphasise on availability of next best option
for customer. As hospitality industry is known for related products and services which is taking
growth at rapid face in every country. But this creates competition for existing firms as customer
shift their demand easily. Hotel TUI has moderate impact of this force due to not having
discounted strategies or schemes for promotions which may shift their customer to other
hospitality organisation who give good discounts and offers.
Threat of rivalry: Rivals threat is the most common for hostility industry due to global
competition and market fluctuation. Every business is in the race of competition to be the
market leader. Therefore, hospitality industry as well as TUI group both have high threat of
competition for future existence as competitors like IHG, Marriott, Hilton are making superior
growth into market (Efthymiou, and Papatheodorou, 2018).
SWOT analysis
it is an effective tool which analyse companies internal surrounding that impact on business
profitability. This elaborates strong and weak areas
Strength weakness
 TUI hotels has leading brand name
which enable customer trust and
retention.
 The company believes in quality and
luxurious services that satisfy
customers needs. (Scheyvens, and
Biddulph, 2018).
 TUI group is not effective in working
on current trends as they do not provide
discounted schemes and offers which
impact on rising competition
(Sofronov, 2018).
 Lack of political stability leads to stop
growth and expansion in other parts of
world.
Opportunity Threat
 The company has good financial
position to undertake technological
advancement.
 To reach audience through digital sites
 The company has major threat of rivals
in terms of technological advancement
and adopting cultural, background and
intermediaries of business environment.

and work on CRM and AI. TUI could
adopt digitalization.
 Lack of competitive strategy to beat
future uncertainties as other hotels took
huge growth by applying cost effective
strategies.
CONCLUSION
The report conclude about hospitality business environment on a broad context. It has
identified a business is affected with micro and macro factor that emphasize on profitability and
productivity of company. Therefore,. The report has resented about strength, weakness and
opportunity with SWOT analyses. Also, competitive forces impact on market segmentation and
fulfil industry requirements.

REFERNCES:
Books and Journals:
Boros, K., 2020. Individual level of the business tourism: different perceptions of the people
involved in the industry. In 11th Emac Regional Conference-Challenging the Status
Quo in Marketing Research (pp. 12-21).
Cunha, C., Kastenholz, E. and Carneiro, M.J., 2020. Entrepreneurs in rural tourism: Do lifestyle
motivations contribute to management practices that enhance sustainable
entrepreneurial ecosystems?. Journal of hospitality and tourism management, 44,
pp.215-226.
Dimitriou, C.K., 2017. Understanding and dealing with service failures in tourism and
hospitality. Service failures and recovery in tourism and hospitality, pp.9-26.
Fitchett, J.M., 2021. Climate change threats to urban tourism in South Africa. Urban Tourism in
the Global South: South African Perspectives, p.77.
Lin, Z., Chen, Y. and Filieri, R., 2017. Resident-tourist value co-creation: The role of residents'
perceived tourism impacts and life satisfaction. Tourism Management, 61, pp.436-442.
Montresor, S., 2018. Innovation in tourism: A diverging line of research in need of a
synthesis. Tourism Economics, 24(7), pp.765-780.
Scheyvens, R. and Biddulph, R., 2018. Inclusive tourism development. Tourism
Geographies, 20(4), pp.589-609.
Sofronov, B., 2018. The development of the travel and tourism industry in the world. Annals of
Spiru Haret University. Economic Series, 18(4), pp.123-137.
Efthymiou, M. and Papatheodorou, A., 2018. Evolving airline and airport business models.
In The routledge companion to air transport management (pp. 122-135). Routledge.
Tinnish, S.M., 2017. Strategic decision elements for hotel managers embarking on a sustainable
supply chain management initiative. In Sustainability in Hospitality (pp. 41-60).
Routledge.
Runte, C., 2019. Corporate Social Responsibility Management in tourism business: The impact
of TUI Group and Intrepid Group on low-and middle-income countries.