Business Environment Analysis: Travel & Leisure Sector Report

This report provides a comprehensive analysis of the business environment within the travel and leisure sector, focusing on the identification and description of key macro issues. Employing the PESTLE model, the report examines environmental, technological, and economic factors influencing the sector. It delves into the potential impacts of these macro issues at a micro-level, specifically within the hotel sub-sector, considering aspects like environmental sustainability, technological advancements, and economic fluctuations. The report also addresses the challenges encountered during the research process, such as identifying relevant parameters and gathering reliable data. The conclusion summarizes the impact of technological advancements, economic growth, and the challenges faced by the hospitality sector. The report emphasizes the need for sustainable practices and adaptation to technological changes to ensure the sector's continued growth and resilience.

BUSINESS ENVIRONMENT

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
a. Identify and describe the key macro issues in the business environment that are significant
for the ‘Travel & Leisure’ Sector...............................................................................................1
b. Explain the potential impacts at micro level ..........................................................................3
c. Describe any 2 challenges while carrying out the tasks ‘a’ and ‘b’ above..............................5
CONCLUSION................................................................................................................................6
REFERENCES ...............................................................................................................................7

INTRODUCTION
Business environment is the amalgamation of internal and external factors that has an
effect on the enterprise's functionalities and operations to meet the customers' expectations by
optimising the resources and increasing productivity with profitability. This has diversified
components such as suppliers, owners, competition, government activities, economic and social
trends and more. This assignment is based on understanding the interrelationships between the
critical issues prevailed in the marketplaces. Furthermore, it puts insights on the impacts of such
issues on the hotel sub sector which has seen enormous progression in terms of financial profits
and revenues generation. Lastly, it will include about along with challenges faced during the
research study.
MAIN BODY
a. Identify and describe the key macro issues in the business environment that are significant
for the ‘Travel & Leisure’ Sector
In regard to this, Pestle Model has been employed to understand the issues of business at
macro level.
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Environmental issues- With the advent of exponential increasing ecological problems in terms of
seasonal changes and variable climatic conditions, there has been as upsurge in the
unpredictability on certain environmental conditions and its overall effects on the infrastructural
development (Page and Hall, 2014). There has been a rise in earth's temperature due to global
warming and this has affected the occurrence of weather events adversely and led to the
incessant exploitation of natural resources. As per Jones, Hillier and Comfort, 2016, travel and
leisure sector is facing challenging situation due to terrorism activities, fluctuations in policies
context to visa, hospitality sector etc. with strict regulations for maintaining the aesthetics of
architectural infrastructure including buildings, museums etc. and safeguarding the entire
security aspect for both tourists and country's citizens. It also has been affected in challenging
manner by waste management system, disposal methods of spoiled and unwanted substances, air
quality, drinking water and more needs. This has reduced the benefits of ‘Travel & Leisure’
Sector and the focus is on minimising the negative consequences on the business and
improvising by adopting the current approaches for sustainable performance. Currently, all the
methodologies and processes that are accommodated in this sector are under tremendous stress to
integrate eco-friendly options by strict Laws and Programs like following guidelines of EPA and
other such acts/laws, implementing CSR policies in enterprise to minimise the negative effects.
Technological issues- This is an alarming issue in recent times as there is an abrupt sharp
influence of technological advancements in the travel and leisure sector. As per Mason, (2015),
management with knowledge of marketing tools led to an accelerated growth in the distinctive
architecture of information systems with Internet of Things (IoT) for execution of operations in
an organised and structured manner. However, there is a security threat that has plagued this
industry in negative aspects. This infusion of computing in traveller's lives have spread the
increased utilisation of mobile applications and internet that posed challenges like hacking of
personal data, phishing, unauthorised access, malware and more. Hereby, consumers have
become tech savvy and have been following the cashless payment modes but this affect the small
scale businesses due to the restriction in accepting the card payments. Giaoutzi, (2017) stated
that automation with entry of artificial intelligence tools in terms of bots etc. for accessing the
speech and video systems and along with this, the context oriented personalization has proved to
hinder the growth. Due to potential burden it has laid on the lower level of this sector especially
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in developing countries where the infrastructural facilities are still not applicable for the
cognitive computing.
Economic Issues-Here, globalisation has become an important part in laying the foundation for
growing challenges in this sector. There are many factors that have shed light on the economic
components that led to macro issues. It has led an online search engine optimization at wider
level that formed ripples in the financial segment. Along with this, as per Tribe, (2011) there is
an evident disparity in terms of income inequality and it has generated various options which can
be conferred as highly priced, reasonable, cheaper and affordable. However, this gap led to
fluctuations in the taxation policies and overall GDP as it adds a substantial amount in the overall
economic development (Page and Hall, 2014). Subsequently, with rising inflation rate, there has
been an ambiguity in the real income and has affected the tangible investments and this
incremental hike in wages ensured that population is comfortable in engaging their money on
recreational and leisure activities (Page and Hall, 2014).
b. Explain the potential impacts at micro level
Sub-sector is defined as per the Industry Classification Benchmark (ICB) that nature of
business which is determined from the revenue source on the basis of classified system of
allocation to companies( Tribe, 2011). With this reference, hotel sub sector has been considered
and it includes foods and beverages, hotel, gambling, accommodation, pubs and clubbing, golf
parks and other such recreational activities.
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Environmental issues-
This issue has dramatic influence on the existing allocated resources which are consumed
by the hospitality sector in all around the globe. It has become an important determinant to
evaluate and identify the parameters that has impacted the micro-level operational activities in
the hotel sub-sector. As stated by Mbasera and et.al., (2016), the environment is in grave danger
due to the social and recreational activities conducted by these hospitality corporations for their
capitalistic gains. There must be appropriate implementation of effective sewage system for
proper disposition of waste water and unwanted substances in terms of wet waste and dry waste
and henceforth, adopting the green initiatives like compositing, buying environmentally-friendly
organic products, using alternative energy sources and more must be employed under proper
regulations. Additionally, they must form a regulatory body which can apply the Corporate
Social Responsibility in maintaining the unauthorized activities related to informal units at foods
and beverages section or gambling areas and such related sub areas. As indicated in the image 2,
there is breakdown for security breaches of most targeted industries like for financial service it is
5%, for hospitality it is 38%, for food and beverages it is 13% and so on.
In present times, it is necessary to understand the importance of propagation about eco
tourism that comprehends the complete conservation of heritage and cultural value in this sector.
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Illustration 1: Breakdown for security breaches
of the most targeted industries

It also involves about educating the tourists about the current burning concepts of carbon
footprint by reducing carbon emissions through car-pooling, promoting afforestation and abiding
by laws in context of biodiversity and wildlife protection and employing pollution free
methodologies through compulsory government interventions. Moreover, these organisations can
foster the use of energy saving approaches and technologies and must promote recycling as the
amount of waste created by hotels has crossed the restricted limit.
Technological issues-
This has put insights on the overall contribution of digitalization in this hotel sub-sector.
For an instance, accommodation services have upped its services game by incorporating
information processing systems for doing reservations or managing rooms by including keyless
entry, installation of cameras, fire extinguishers, smoke alarms in lifts and lobbies etc. Along
with it, the hotel management has started following teleconferencing on the lodging part and
reservations through online platforms like social media podiums such as Facebook, official
website, trip advisor etc. and through mobile applications by giving special discounts, offers and
also provision for automatic check-in and check-out to attract their guests and clients in more
profound medium.
Consequently, these must put emphasis on usage of authentic and real-time information
and data analytics integrated framework to combat the security issues (Miorandi and et.al.,
2012). However, personal data is reaching the doors of all hotel organisations and is refereed as
one of those attractive commodities in gaining the personal data and delivering a synchronised
personal touch and room preference as per the convenience of each customer. As per Li, Chen
and Vanhaverbeke, (2018), AI bots can be used as guards to check the vantage points from
where any illegal activity like planning of terrorist attack, smuggling etc. can occur which can
deteriorate the hotel's reputation at global level.
Travel and leisure is that sector where consistent innovations are required to safeguard
the company's policies and personal details as well as providing proper protection to their assets,
staff and customers (Swarbrooke and Horner, 2012). Furthermore, these has affected the small
scale hospitality sector companies in both developed and developing countries as the
maintenance and administration of such hi-tech data analytics can only be done by leveraging the
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sustainability and standardisation of quality through huge investments and collaborations which
is not a viable option in present context.
c. Describe any 2 challenges while carrying out the tasks ‘a’ and ‘b’ above
This assignment has been carried out effectively by constant efforts and intensive
exploration of research through suitable data collection methods, that is, by using both primary
and secondary methods. The two main challenges that I have faced while doing research are the
following.
Firstly, there was a huge crisis for identification and recognition of all the parameters
related to the segmentation of the travel and leisure sector. I found that a large amount of data
was available, however, it was difficult to choose the right topic segregation regarding the
current issues which have been plaguing this sector. Moreover, it is understandable that the
foundation of any research is the objective and thus, it became a critical part for me to effectively
divide this identification in viable manner (Viswanathan, Chen and Pompili, 2012). Furthermore,
this was dealt by adopting few strategic planning to decide. This means that various studies were
already conducted on the same topic, and thereby, took assistance from them by properly
determining the resources into smaller sub-sections on the basis of country's development,
economic status, demographics, and overall impact of issues on the whole. Along with it, the
durability was another imperative part of this challenge and put a stumbled viewpoint through
adopting an interdisciplinary framework of understanding in terms of science, logic and
reasoning.
The second challenge was assembly of data and other related information to support the
overall evaluation done on this topic. In addition to this, there were few glitches that blocked the
path in negative aspects such as the feedback was ambiguous and irrelevant due to unavailability
of authentic sources. However, the secondary data collection methods proved beneficial but were
unclear in providing suitable suggestions and recommendation to continue this topic in more
expansive fashion. There were few leveraging objectives in laying the networking of defined
approaches in conducting this study but due to proper guidance and ad vocation of vocational
methodologies, it became easier for me to collect the data. Here, the main challenge to overcome
was attainment of reliability and validity, which was conveniently dealt by proper usage of tools
and technologies and through proper guidance on education channels online. This means that it
was easy for me to collect data and review or evaluate it with the help of relevant methods and
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techniques as well. Also, there was clarity in terms of analysis and the collected findings which
accelerated this research in forwarding direction by minimising cost effectiveness and improved
the time efficiency.
CONCLUSION
It has been summarised that with technological advancements due to the onset of open
economy and globalisation has given rise to deterioration of environmental components
including flora and fauna, atmospheric conditions, unsteady variations in climatic conditions and
more. Furthermore, it has been summed up about the challenges faced by the hospitality sector
due to sudden economic inflate growth rate, it has adversely impacted the micro level issues like
small businesses, exploitation of labourers, more competition at the global level amongst
different brands and establishments. Moreover, the countries along with the private hospitality
organisations and various tour operators must together cooperate to bring ecological suitability in
all the operations at production level. Hereby, human must put a ban on its encroachment
activities that has affected our ecosystems in such a pessimistic manner.
REFERENCES
Books and Journals
Giaoutzi, M., 2017. Tourism and regional development: New pathways. Routledge.
Jones, P., Hillier, D. and Comfort, D., 2016. Sustainability in the hospitality industry: Some
personal reflections on corporate challenges and research agendas. International Journal of
Contemporary Hospitality Management. 28(1). pp.36-67.
Li, Q., Chen, J. and Vanhaverbeke, W., 2018, March. uBid100: A New Model of Hotel Booking
in the Age of AI. In 2018 IEEE International Symposium on Innovation and Entrepreneurship
(TEMS-ISIE) (pp. 1-6). IEEE.
Mason, P., 2015. Tourism impacts, planning and management. Routledge.
Miorandi, D. and et.al., 2012. Internet of things: Vision, applications and research challenges. Ad
hoc networks.10(7). pp.1497-1516.
Page, S.J. and Hall, C.M., 2014. The geography of tourism and recreation: Environment, place
and space. Routledge.
Page, S.J. and Hall, C.M., 2014. The geography of tourism and recreation: Environment, place
and space. Routledge.
Swarbrooke, J. and Horner, S., 2012. Business travel and tourism. Routledge.
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Tribe, J., 2011. The economics of recreation, leisure and tourism. Routledge.
Viswanathan, H., Chen, B. and Pompili, D., 2012. Research challenges in computation,
communication, and context awareness for ubiquitous healthcare. IEEE Communications
Magazine.50(5).
Online
Jong,A., 2017. Travel activities Market to reach $183 Billion by 2020.[Online]. Available
through:<https://www.phocuswright.com/Travel-Research/Research-Updates/2017/Travels-
Tours-and-Activities-Market-to-Reach-US183B-by-2020>.
Mbasera,M. And et.al., 2016. Environmentally-friendly practices in hotels. [Online]. Available
through:<http://www.scielo.org.za/scielo.php?script=sci_arttext&pid=S1684-
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Metzger,T., 2010. Hotels a hot spot for credit card fraud. Online]. Available
through:<https://www.creditcards.com/credit-card-news/spiderlabs-study-hotels-credit-card-
fraud-1276.php>.
Mukher,S., 2018. Business Environment Types. [Online]. Available
through:<http://www.economicsdiscussion.net/business-environment/business-environment-
types-external-micro-and-external-macro/10095>.
Reasons why your hospitality business needs a hotel mobile application, 2018. [Online].
Available through:<https://www.cleveroad.com/blog/hotel-technology-solutions—how-a-
mobile-app-can-bring-your-hotel-more-clients>.
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