Contemporary Issues and Trends in Sri Lanka Travel and Tourism Sector

This report provides a comprehensive analysis of the contemporary issues and trends impacting the travel and tourism sector in Sri Lanka. It begins with an introduction to Sri Lanka as a popular tourist destination and introduces British Airways as a key player in the industry. The report then delves in...Read More

CONTEMPORARY ISSUES IN TRAVEL AND TOURISM
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Table of Contents
Introduction.................................................................................................................................................3
Introduction to Srilanka and British Airways...............................................................................................3
LO1 current issues in the travel and tourism sector....................................................................................4
1.1analyse issues that are driving change in travel and tourism sector of Srilanka..................................4
LO2 Understand the current trend in the travel and tourism sector...........................................................6
2.1 current trends that bring changes in the travel and tourism sector of Srilanka...................................6
2.2 analyze current trends through usage of different techniques and resources......................................7
Lo3 Understand how travel and tourism sector responds to change in airline businesses.........................8
3.1 how travel and tourism businesses could respond to change.............................................................8
3.3 justify strategies for how selected travel and tourism businesses could respond to change.............10
LO4 Understand the impacts of change on the travel and tourism sector................................................11
4.1 analyze the impacts of issues and trends that drive change in the travel and tourism sector............11
4.2 discuss the likely consequences of businesses failing to respond to market changes.......................12
Conclusion.................................................................................................................................................12
References.................................................................................................................................................13
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Introduction
Travel and tourism businesses are rapidly growing all over the world as individuals nowadays
are interested in traveling so as to relax, spend time with family and indulge in some or the other
kind of adventure among others (Buultjens, Ratnayake and Gnanapala, 2016). The travel and
tourism industry has seen continuous advancements which have increased the number of
consumers with every passing day. But the industry has been facing a large number of challenges
and issues which is required to be handled in an effective manner (Champika and Silva, 2015).
The current study thus deals with issues and trends present in travel and tourism sector with
special focus on Srilanka as a destination. Other than this, emphasis has also been laid on how
the travel and tourism sector respond to changes followed by assessing the overall impact of
special reference to British Airways.
Introduction to Srilanka and British Airways
Srilanka is one of the most popular destinations for tourists in South East Asia that is known for
its endless beaches, world heritage sites, oodles of elephants, ancient monuments, cheap prices,
fun trains as well as world famous tea and flavored food. Other than the above attractions, there
is also a presence of tourist activities such as kite surfing, yoga retreat, whale watching, and
scuba diving among others. The country has further been witnessing an increasing number of
tourists which has reached an all-time high in the year December 2016 by being at 224791. In
order to meet up the increasing demand of tourists, the Srilanka tourist providers have set a target
of 22500 rooms in the next five years as the visitor arrival is being expected to reach up to 2.5
million (Mills, 2017).
British Airways have been regarded as the largest airlines of United Kingdom and is also the
largest carrier in UK that serves around 40 million consumers in a year. It has further been
travelling to around 170 destinations in more than 70 nations all over the globe (Gretzel and
et.al., 2015). In terms of consumer profile, the world famous airlines is serving four segments of
clients who belong to economy, premium economy, executive and first class. It has a goal to
become a world leader in global premium airlines by focusing on consumer service at every level
of passenger’s journey. It thus works on the principle of passion and expertise so as to serve the
consumers in the best possible manner. Focus is also given on providing personalized as well as
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thoughtful experience with respect to service offering that showcases British style as well as
sophistication.
LO1 current issues in the travel and tourism sector
1.1analyse issues that are driving change in travel and tourism sector of Srilanka
As of now, the tourism industry of Srilanka is on a boom which is revealed by a newspaper
article which states that there is a presence of over 2.5 million foreigners who arrived in the
nation during the year 2016. While there was a presence of 2.3 million tourists till June 2017 and
the number is likely to increase by the end of 2017 in comparison to 2016. Statistics further
reveal that 4.5 million tourists can still visit Srilanka by the year 2020 (Kananga, 2017). But still
there is a presence of various issues that are leading to changes in travel and tourism sector of
Srilanka.
 Environmental issues - The changing environmental conditions is putting drastic impact
on the travel and tourism business of Srilanka. This is as Srilanka is basically an island
nation and the presence of global warming issue is affecting the overall climatic
conditions of the nation. For example, Ockhi cyclone that affected South Asian nations in
the year 2017 led to issue of warning to holiday makers who were planning to pay a visit
to Srilanka (Mills, 2017). The country further asked for help from United Nations and
neighboring countries to help in flooding crisis that worsened over a period of time.
 Lack of technological soundness - Srilanka is a developing nation hence its technological
advancements are not as sound like other destinations being London etc. Hence the
absence of proper transport, communication etc. put an impact on the overall satisfaction
level of consumers. There is also an issue in overall infrastructure facilities which deters
the tourist from developed nations who plan to make a trip (Dicknson and et.al., 2014).
 Economic issues - raising fuel cost decreases the tourist flow as the overall trip expense
increases. Other than this, the tax rates imposed on travel and tourism industry of any
nation impact the overall flow of tourists. This is as increase in the same enhances the
cost of services that is offered to the travelers (Robinson and Picard, 2016). Moreover, if
the service offering is not up to the mark as per the money that is charged then consumers
are most likely to give a second thought after hearing reviews from other travelers who
paid a visit to Srilanka.
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 Increase in competition - Srilanka nation as a tourist destination is further facing
increased competition from neighboring nations like India, Malaysia as well as China.
These nations are developing more advanced tourist product than Srilanka thereby
attracting the mass tourism market (Hall and Page, 2016).
 Type of tourist - Other than this, there is also an issue in terms of the type of tourists who
visit Srilanka. This is as the nation is considered as a value for money destination due to
cheap offerings thereby attracting lower end tourists’ lot more than high-end tourists. But
it is also a known fact that the higher end tourist is basically known to bring more
earnings in terms of foreign exchange (Buultjens, Ratnayake and Gnanapala, 2016). The
governmental authorities are thus trying hard to approach high-end tourist as well by
placing an increased emphasis on the development plans in tourism.
The concept of worldwide standardization all around the globe has resulted in the creation of
products and services that are less unique. Same applies to Srilanka which offers the same type
of tourism products that are also found all over the globe. These include hiking, safaris, and
discounted tour packages among others (Hettiarachchi, De Silva and Sivashankar, 2015).
Sameness is thus a big challenge not only for Srilanka as a tourist destination but all the famous
spots all over the world. This basically increases the overall switching rate of the consumers who
prefer to move to those destinations who are somewhat unique and at least provide quality in the
services even it is of higher price.
1.2 analyses different issues by usage of different methods and resources
In order to assess various issues that are being faced by the Srilanka nation, there is a usage of
secondary data sources wherein information has been collected from internet, websites, journal
articles as well as books. One of the reports available on the internet has revealed that there has
been an increase in overall tourist flow of Srilanka as the island attracted around 2,058,000
visitors in the year 2016. Moreover, Sri Lanka Tourism Development Authority (SLTDA) has
further revealed that there has been a 14 percent increase in tourism as compared to last year
which is the highest number attained with respect to tourism in Srilanka (Ziffry, 2017). However,
the island was affected by high torrential rains and floods in the year 2017 which led to a fall in
arrivals by 2.5 percent in the month of May 2017 which was up by 4.8 percent in the same year
in comparison to previous year (Sri Lanka tourist arrivals down in May 2017 impacted by
weather, 2017). A report by Srilanka ministry of foreign affairs has revealed that the competitors
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of the nation in area of tourism activities are at a much higher level when it comes to how much
the tourism activities contribute to overall GDP of the nation. For example, Malaysia stands at
12.5 percent while Vietnam is at 7.5 percent while Srilanka is even less than 5 percent (Key
challenges facing the tourism sector in Sri Lanka, 2014). Hence the need here is to prepare a
master plan by the industry as well as government.
Other than this Srilanka has failed to match with the slogan being Wonder of Asia as it makes
the tourists think as to what wonders is present in the nation. One cannot think of more beyond
Sigiriya (ancient rock fortress that has archeological significance) and the gathering of elephants
in Minneriya. The issue here is that Srilanka still lacks a comprehensive marketing strategy as
well as campaign to promote the nation as a tourism destination. A lot of work is still required to
be done in this area (Wilks, Stephen and Moore, 2013). Another study has revealed towards
overpricing of hotel accommodations in Srilanka as the pricing policy was changed after civil
war. This has increased accommodation charges by up to 40% to 50% on a per night basis
(Burns and Cowlishaw, 2014). But the standard of service is not good as per the amount which is
being charged by hotels. This has resulted in a significant decrease in occupancy rate due to
improper charging of prices.
As per the above statistical findings, there has been an increase in overall tourism flow to
Srilanka but human resource is not much trained in order to meet this demand. Reports have
revealed that Srilanka tourism is not generating sufficient number of students who are capable of
working in travel and tourism sector (Nagahawatte and O’Connell, 2016). The major issue in this
regard is lack of proper communication skill set which is acting as a huge issue for the industry.
Hence these are the set of issues that are affecting the visitor sentiment to pay a visit to Srilanka
and because of this, it is not able to perform as better as its other developing Asian nations.
LO2 Understand the current trend in the travel and tourism sector
2.1 current trends that bring changes in the travel and tourism sector of Srilanka
There is a presence of many trends that are bringing a strategic change in travel and
tourism sector of Srilanka.
With the increase in globalization, there has been a birth of many tourism destinations
which is acting as a major threat to Srilanka. The need on part of the nation is to offer many new
forms of tourism products such as reasonable accommodation facility; consumer oriented
services, best dining experiences as well as attractions that are not found anywhere else in the
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world (Coller, Mills and mills, 2016). This will aid in giving visitor to Srilanka an all-round
experience thereby increasing his satisfaction. Other than this, there has further been ease in
restriction to travel such as lack of visa restrictions. Srilanka tourism has responded to this
strategy by providing visa on arrival facility which has boosted flow of tourists to its country.
The tourism nations have further been offering aggressive strategies of promotion which is
somewhere lagging in the nation and is required to be worked upon in the best possible manner
(Buultjens, Ratnayake and Gnanapala, 2016). It has further been found that decrease in cost of
air fare, increase in overall affluence as well as presence of visitors traveling to and form the
nation for business purposes along with packages offered by tour companies has increased the
travelers in the Asia including Srilanka who are coming from other foreign destinations. The
demand for traveling has created new tourism opportunities and products such as ad entire travel,
cruise, and ecotourism among others. Srilanka is thus required to focus on this change and
provide product options in these new categories as well (Hettiarachchi, De Silva and
Sivashankar, 2015).
There is further a rise in overall active as well as adventure trips. For example, travelers
now days prefer to visit African safari, swimming with sharks in oceans of Mexico and hiking in
Swiss Alps. This is basically done by them in order to get away from there mundane life and get
an out of the world experience (Lange and et.al., 2015). Srilanka due to the presence of its huge
natural heritage has worked on this area and provided the travelers with options such as Jungle
camp in Habarana; deep sea fishing in the Indian Ocean among others. However, it is still
required to bring changes by moving beyond its normal adventure and provide something which
is unique to the country.
As per the above discussion on current trends within travel and tourism market, it is
recommended to Srilanka that it must be in tune with existing as well as future trends so as to
maintain or further strengthen its position in the future world of travel. The need is thus to start
working one long-term action plan that offers a set of strategies that are in tune with the above-
mentioned trends.
2.2 analyze current trends through usage of different techniques and resources
There can be usage of secondary resources as well as secondary data collection techniques in
order to assess current trend in travel and tourism market. As per the current trends, the Srilanka
economy is offering varied forms of tourism that are as follows;
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Spiritual tourism – there is growing trend in foreigners especially from the middle east that pays
a visit to Srilanka in order to seek inner peace during the vacation time. Srilanka tourism thus
offers various forms of meditation and pilgrimage visit opportunities to the visitors. Some
Muslim tourist also comes to Srilanka in order to learn the art of Buddhism (Buultjens,
Ratnayake and Gnanapala, 2016). In the same manner, a large number of meditation centers have
also been set up in the nation for meeting up the demand for spiritual tourism.
Eco tourism – This form of tourism is in a huge trend these days as the individuals wish to
experience the surroundings in its purest form. This is being done by Srilanka tourism in the
form of offering pristine seas as well as unexplored wilderness. There is further a presence of
many rain forests, pearly beaches as well as small islands that are quite famous among the
tourists. Other than this, mountain climbing; hiking; visit to wildlife etc. are acting as a huge
source of opportunity by which the tourists can feel close to the nature (Madar, 2015).
Festive tourism – This is a new form of tourism where people visit the destination in order to be
a part of the festivals that are celebrated in that nation. Srilanka tourism board is thus required to
work a little more in this area and promote its nations more before the time of upcoming festivals
such as May full moon poya day where Buddhist celebrate the enlighten of lord Buddha as well
as Kataragama Esala Festival where devotes perform fire walks as well as extreme forms of self-
penance in order to show pity to the lord (Moore and Taylor, 2016). This is most required to be
done by Srilanka tourism board as the place has got many cultural ethos and traditions which can
be used as a source of revenue generation
Global sports tourism is on the go and Srilanka board is required to lay emphasis on its
promotion. Efforts have been taken in this regard, wherein the government is focusing on sports
activities such as golf as well as surfing activities. More is required to be done in this area but it
is expected that the start has been good hence better-planning efforts can also be done in this
direction.
Lo3 Understand how travel and tourism sector responds to change in airline businesses
3.1 how travel and tourism businesses could respond to change
Frequent changes in the overall operation of travel and tourism business are a very common
issue which happens in a very short span of time. In order to ensure that tourism and travel
business respond to change in best possible manner, the need is to lay emphasis on the following
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points. First of all, there is a need to learn by exploring past so that previous mistakes are not
repeated again. On a second note, the success of any change undertaken in the organization
depends on how the human resource is treated (Hettiarachchi, De Silva and Sivashankar, 2015).
Thirdly, presence of technological advancements is just not enough for success but the need is to
gain cooperation as well as overall involvement of people. Fourthly, knowledge is power and
education, communication as well as data as well as experience acts as its main source. Other
than this, it is very essential to understand as to how the organization responds to the changes in
various ways which can be understood by carrying out a study on SWOT and PESTLE analysis
of the company. Some strategies can further be followed by the company which is mentioned
below (Grundy and Moxon, 2013). It is a well-known fact that there is a presence of various
technological advancements in travel and tourism industry. In this regard, the internet technology
has put a huge impact on overall working of industry. Hence the consumers can conduct a
thorough research about the destinations and do online bookings by taking reviews form website.
Hence, the need is that the airlines should try to develop a positive image in the minds of
consumers.
In the same way, Socio-economic changes are also taking place hence the need is to offer
customized products and service offering to the travellers. This can further be in form of
providing unique travel packages followed by discount offers. There is also a presence of certain
economic factors that affect the business of tour and travel businesses. For example, in case of
airline industry, the issue is in form of rising prices that impact the ability of consumer to make a
decision regarding traveling by air. The low cost airlines in this regard are trying to take an
advantage of the situation and creating an impact on purchasing decision of tourist (Geppert
Matten and Williams, 2016). Hence the need is to evaluate the overall demand for the same and
provide services according to it. The governmental policies in relation to passenger safety and
security are also required to be given a due emphasis. In this regard, the airline firms are required
to increase the overall monitoring of their passengers.
3.2 develop strategies on how selected travel and tourism businesses could respond to change
Many strategies have been undertaken by British Airways in order to respond to changes in best
possible manner. In the present times, there has been an increase in the overall growth of low-
cost carrier planes that are offering economical packages to travellers who travel by air on a
frequent basis. Hence a strategy has been undertaken by BA by which it is trying to focus on its
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economy cabin so as to make it competitive with the rival firms. The strategy is in tune with
what is valued the most by the consumers. As it is serving those economies where price is the
main driver hence increased emphasis has been laid on delivering more seats at low prices
(Coffey, 2017).
It is further trying to be in tune with the changes in governmental policies with respect to safety
and security of passenger. Hence the company has launched a British Airways safety video
which is a 6-minute film that runs through safety instructions for flights of British Airways. The
video features Chiwetel Ejiofor, Gordon Ramsay and Gillian Anderson who are running through
the demo on safety. Thandie Newton as per the video explains the location of emergency exits
while Rob Brydon emphasizes on usage of life jackets. There is also a presence of Sir Ian
McKellen and Warwick Davis who depict the usage of oxygen mask (Grundy and Moxon,
2013).
The company is further aware about the recent technological advancement in terms of usage of
social media sites by consumers for posting their responses. Hence it ensures that consumer
complaints on social media sites are given a greater emphasis and responses are posted. Along
with this the company had further provided its 2000 senior crew members with an i-pad that has
Enhanced Services Platform’ so as to allow flight attendant for storing as well as receiving
relevant passenger details on a real-time basis which is in form of itineraries as well as meal
preferences (Grundy and Moxon, 2013). It has further utilized high remote-controlled devices for
pushing back the aircraft across its operations. The airline is further modernizing its operational
system so as to improve the overall punctuality given to passengers.
3.3 justify strategies for how selected travel and tourism businesses could respond to change
British Airways has started focusing on economy cabin as a strategy so as to serve the needs and
requirements of its business class as well as economy class consumers in the best possible
manner. It is very essential for the firm so that it is able to serve many consumers that have a
presence of different preferences at the same time. The provision of low-cost travelling option
can aid in increasing the overall demand of potential consumers. But it is also true that British
Airways has always focused on targeting high-class passengers hence dropping the price is likely
to create a negative impact on its overall brand image which can lead to loss in the long run
(Abratt and Mingione, 2017). But it is further true that there will be more revenue generation for
the consumers. In the same way, the use of enhanced service platform launched by British
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Airways is most likely to help in working on consumer satisfaction levels. This is as if the crew
member is aware of the details of passenger then service can be rendered in the best possible
manner.
Similarly, safety and security of passengers is one of the foremost goals of any service sector
company including British Airways. Hence the strategies taken by the company to safeguard its
consumers is justified so as to be in tune with the governmental policies (Buultjens, Ratnayake
and Gnanapala, 2016). The use of gimmicks, colorful animation etc. is most likely to attract the
attention of passengers as safety instructions is the most overlooked part of the flying experience.
It will further aid in raising client awareness about the global charity partnership that has taken
place between British Airways and Comic Relief so as to raise 26 million dollars by the year
2020 (Baum, 2016). Along with this, increased presence of British airways on social media to
handle complaints is likely to make the airlines as the one which is concerned about consumers.
LO4 Understand the impacts of change on the travel and tourism sector
4.1 analyze the impacts of issues and trends that drive change in the travel and tourism sector
There is a presence of different issues as well as trends that are driving change in British airways.
These are as follows;
Currency fluctuations – the change in currency rate after Brexit issue has put an impact on
overall decision of travellers. The airlines is most likely to face a decrease in passenger number
if restrictions are imposed on European flights as UK carriers will only be able to operate direct
flights between UK and EU (Hettiarachchi, De Silva and Sivashankar, 2015). British airways
will therefore have to give focus only on the profitable routes from UK so that increased
operating costs can be offset.
Security: the increased terrorist attacks in London during 2017 have ensured that British airways
raise its safety measures and comply with the governmental policies in a stringent basis. These
policies are good as they are linked to overall safety of passengers but the security policy over
visa system is demotivating the international tourists as they are required to pass through various
stages before getting visa.
Governmental actions – the government has been taking several steps in form of promoting
events and programs of UK which is acting as a good sign for overall growth of British airways.
This is as consumers are likely to get attracted towards the events and plan to pay a visit to UK
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which can aid in increasing sales and revenue for the company (Hettiarachchi, De Silva and
Sivashankar, 2015).
4.2 discuss the likely consequences of businesses failing to respond to market changes
If British airways do not respond to market changes then it is most likely to face financial crisis
in a short span of time. For example, if British airways do not get in flow with technological
advances and is not able to train its staff for the same then consumers are likely to get attracted
towards competitive firms and generate business for them. Other than this, if customized service
offerings are not given to consumers then there can be attitudinal change within them which may
reduce the overall profit margin of the company as sales revenue will not be generated (Prayag
and Hosany, 2015). This is can further put an adverse impact on the organizational image as
being the one who is not responding to the changes. Proper business and profits can only be
generated when organization adapts with the said changes. Carrying out a thorough analysis of
changes will aid the firm in having a better view of future perspectives which will put an impact
on the business (Buultjens, Ratnayake and Gnanapala, 2016).
Conclusion
From the above report, it can be concluded that travel and tourism industry has become an
important part of the global economy. The Srilanka economy has further benefited due to the
tourism-related initiatives taken by the government. Still, the tourism sector of Srilanka is facing
several issues in terms of environmental changes, lack of trained manpower, increasing
competition among others that are posing a threat to the overall growth of the sector. However,
there is a presence of many current trends that are bringing changes in the entire tourism industry
of Srilanka. These are in form of increased globalization; decrease in cost of air fare; overall rise
in adventure trips; and new tourism forms such as spiritual, eco, festive and sports tourism. On
another note, it is very essential for firms to formulate strategies in order to respond to change n
best possible manner. British Airways in this regard have used many strategies such as safety
video, Enhanced Services Platform as well as increased focus on economy cabin so as to attain
future sustainability of its business operations. Other than this, there is also a presence of certain
trends and issues that are guiding the working of British airways which are in form of currency
fluctuations; security as well as governmental actions. The need is to respond to them in a best
possible manner so as to maintain a bright future of the airlines company.
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