Analyzing TUI Group's Business Environment: A Case Study Report

This report presents a comprehensive analysis of TUI Group's business environment from 2019 to 2022, focusing on the significant impacts of the COVID-19 pandemic and the UK government's subsequent recovery plan. The analysis delves into both the internal and micro-environments of TUI Group, evaluating how the pandemic affected operations, revenue, employment, and technological advancements. Furthermore, the report examines the UK government's initiatives, such as easing taxation and entry restrictions, designed to support the tourism sector's recovery. The study also employs STEEPLE analysis to assess the broader macro-environmental factors, including social, technological, economic, environmental, political, legal, and ethical dimensions, and their influence on TUI Group's strategies and performance. The conclusion emphasizes the importance of identifying and responding to both internal and external factors to ensure sustainable growth and success within the dynamic tourism industry.

Travel and Tourism

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY ..................................................................................................................................1
Section1 ...........................................................................................................................................1
Summary.................................................................................................................................1
Section 2 ..........................................................................................................................................2
The impact of Covid 19 Pandemic on TUI Group's internal environment. ..........................2
The impacts of the UK government’s recovery plan on TUI Group’s internal environment.3
Section 3...........................................................................................................................................3
The impacts of the UK government’s recovery plan on TUI Group’s micro-environment ..3
The impacts of the Covid-19 Pandemic on TUI Group’s micro-environment.......................4
Section 4...........................................................................................................................................4
The impacts of STEEPLE factors on TUI Group’s operations..............................................4
CONCLUSION................................................................................................................................5
REFERENCES................................................................................................................................7

INTRODUCTION
The operations of any business is effected by the business environment which consists of
external and internal factors. Business environment is the aggregate of all people, organisations
and other factors that are not in the power of any business and can impact the operations and
productivity. Internal factors are those factors on which business holds control like labour,
finance and technology. The success and profitability of an organisation depends on macro and
micro business environment. Micro business factors are the one that can have an influence on the
performance as well as routine operations of any firm. Macro business environment refers to the
external factors within an economy (Lew and et.al, 2021). It includes factors like inflation, fiscal
policy,monetary policy etc. In order to gain a sustainable development the organisation need to
keep updated with the uncertain changes and factors that can effect productivity and profitability.
The report is based on TUI Group, is a German leisure, travel and tourism company. Its
headquarter in Hanover, Germany. The report is prepared to understand the components and
concept of business environment and its impact on travel and tourism industry in Covid-19. It
also discuss the remedial and precautionary steps taken by the government to tackle the
particular situation.
MAIN BODY
Section1
Summary
TUI group is one of the leading tours and activities that combines a scalable digital
platforms and has global presence in many countries in tour and travel industries. TUI group
owns five European airlines, and is the largest group in Europe. The aim of organisation is to
create unforgettable moments for customers across the world and make their dreams come true.
It works on the development opportunities which is accessible to all employees, that provides
tools for personal and professional skills development which makes them more effective and
efficient. This sector plays a crucial role in contributing in the growth and development of an
economy and its overall GDP growth (Chua and et.al, 2020).
The main aim and purpose of TUI group is to meet the requirements of its individual and
makes a positive impact on peoples mind by making a exposure to new places and peoples. It is a
German tourism industry. The sector of tourism industry is divided into three main areas which
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is accommodation, travel and hospitality related services and provides benefits and opportunities
to its customers, employees and shareholders.
Organisation structure
It is a systematic arrangement of different resources in an organisation in order to attain
and achieve the organisational goals and objectives. The structure determines the efficiency of
business to adopt the changes rapidly and effectively and helps in acquiring different growth
opportunities that helps to attain a great market share in long run (Boğan and Çalışkan, 2021).
There are different kinds of organisational structure which depends on the functioning and
operations that are being conducted which includes functional, divisional, flat and matrix
structures. It makes the operations more efficient and effective and enables smooth functioning
of different functions. The organisation structure which is being adopted by TUI group is
functional structure, it divides the operations and activities in different departments on the basis
of expertise, grouping workforce based on their speciality, skill and related roles. The hierarchy
flows from top level to lower level. The advantages of this structure are specialisation as it works
on a one area of work and improves overall productivity. There is clear delegation of
responsibility and authority which help in accomplishment of organisational objectives.
TUI group annual revenue in year 2021 was 4731.6 million euros which has been
reduced from the year 2020 from 3212.1 million euros which was about 7943.7 million euros. In
the year 2019, the company annual turnover was 18928 million euros. The reporting period 1st
October 2020 to 30th September was prepared through annual report of 2021. currently the
company holds an employee base of around 57000.
Section 2
The impact of Covid 19 Pandemic on TUI Group's internal environment.
It consists of the components that exist within the internal functioning and operations of
an organisation and has the ability to influence the decision making process of an organisation. It
comprises of the climate, culture, machines and equipments and management and management
practices (Leighton and McKeown, 2020). The internal environment analysis is being conducted
to evaluate the impact of Covid 19 pandemic on TUI group which is discussed below-
 Tourism industry is one of the important factors to contribute in development of an
economy. But due to COVID pandemic, it has impact a lot of areas and operations of an
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organisation. One of the major impact which an organisation has to face is a lot of jobs
are at stake, which have leads to increase in overall unemployment in small and medium
enterprises in an economy. Many of the individuals have lost their job roles due to lack of
opportunities and work in the enterprises, which have reduced the overall growth and
GDP of an economy (Li and et.al, 2021).
 Another major impact which COVID 19 pandemic have is the revenue gap in the
economy. Due to the pandemic many of the tourists are not being able to visit to different
countries which have impacted the income level of the locals and of whole economy. It
has impacted the economies as they are not being able to invest in the expansion of its
infrastructure and in the development and welfare of society.
 The impact of pandemic have increased the role of technological advancement in industry
, they have started using their applications to provide an ease to their customers in online
booking of accommodations and get to know about the offers that are being provided by
organisation to their customers.
The impacts of the UK government’s recovery plan on TUI Group’s internal environment.
In order to overcome the impact of these pandemic which includes government have
started reopening of tourism industry, providing economic support and easing rules and
regulations which will help the organisation to attract more visitors and expand their tourists
volume and visitors experience. Another recovery plan which government of UK take Place is
establishing a well connected and shared benefits between different regions that eases the trade
between different countries and more. Another recovery plan is bring more innovations and more
productive industry that will help in meeting the needs and expectation of the customers. These
all recovery reforms helps the tourism sector to regain its role and help in contribution to the
economy as the UK economy development and GDP growth depends on this sector crucially
(Song and Zhou, 2020).
Section 3
The impacts of the UK government’s recovery plan on TUI Group’s micro-environment
In order to regain the share of Tourism industry government have developed various
recovery plan in order to reduce the negative impact of these pandemic. The government have
ease the taxation policies and makes a lower tax slab rates as compared to earlier. The
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government have also provided an advantage to the organisation as they have reduced the rate of
interest on loans in order to expand their operations. TUI groups focuses on providing comfort
and enjoyment to the individuals at an affordable rate which will help the organisation to gain a
good customer base. Tax reduction and ease in entry restrictions enable the organisation to
increase their overall profitability and contribute in economic development (Duan and et.al,
2020).
The impacts of the Covid-19 Pandemic on TUI Group’s micro-environment.
Tourism has a important role in delivering the government a steady economic growth and
development. The factors that have impacted more this organisation is employment rate and loss
in number of visitors. There are various other factors as well as challenges which involves
reduction in the local as well as international visitors which have reduced the overall revenue
generation and income level of an organisation. The evolution of all these factors helps an
organisation to make strategies and develop plans that will help to deal with the rapid changes
and negative business factors. The organisation have also introduced technological advancement
in their operations, that will provide convenience and ease to their customers it includes online
accommodation booking, advance payments and more.
Section 4
The impacts of STEEPLE factors on TUI Group’s operations.
To evaluate the macro and micro environment factors, STEEPLE analysis is being
performed which will help an organisation to analyse and determine its influence on organisation
functioning and operations in context to TUI group-
 Social factors: These factors comprises of the cultural norms and expectations , beliefs,
attitude and behaviour of customers and different stakeholders. It includes the
demographic factors of a market. In context to TUI group it plays a crucial role as it
enables them to understand the behaviour and culture of different countries. It attain a
large group of consumers nation wide which helps them to hold a competitive advantage
in the market (Abid and et.al, 2021).
 Technological factors: This factor have a positive impact on TUI group functioning and
operations. The emergence of online transportation facilities have transforming the role
of the organisation and help them to hold competitive position. The organisation have
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been using different applications to provide facilities like online booking for
accommodation, online partners that provide an ease and convenience to customers.
 Economical factors: The industry of tour and tourism are widely impacted by the
COVID 19 pandemic because many of the employees have loose their jobs because of
lack of work and profitability within an organisation (Palm and et.al, 2019). The
economy of the UK have positive growth in the economy but due to decline in the growth
in tour and travel industry the overall GDP has been declined.
 Environmental factors: It involves evaluation of the environmental factors such as
weather conditions, climatic changes, recycling and air and water pollution. The
organisation have made various initiatives to make the environment green and maintain a
clean surrounding. The business is planning to gain a sustainable development that helps
the organisation to maintain a good image in the market.
 Political factors: This relates to the government regulations and policies that can impact
the profitability of an organisation. Following the government interventions will help an
organisation to attain growth and success.
 Legal factors: The organisation has set laws and regulations for its employees in order to
provide them the safety and regulations. It includes consumer protection laws, law related
to safety and security, anti trust laws and more which can impact tour and travel industry.
The organisation faced a lot of challenges in COVID 19 phase and retrench a lot of their
workforce in order to sustain and survive in the market.
 Ethical factors: It is a set of behaviour and well structure standards to determine what is
right and wrong towards the society and specific virtues. It involves incorporation of such
policies that can impact the guide the efforts and responsibilities of employees and
management in an ethical manner. The TUI group proper and have set standards to
ensure a good proactive of ethics in their functioning (Van Holm and Wyczalkowski,
2019).
CONCLUSION
From the above report, it is being concluded to achieve growth and success, it is
important for business organisation to identify all the internal and external factors. An evaluation
of these factors helps an organisation to make different strategies and plans that help to
overcome its negative impact. The report is based on tourism industry, which has its operations
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in many nations. The report is based on the impact of COVID 19 pandemic on its operations and
functioning. It discusses the impact of internal factors, macro and micro environment factors on
business organisation and its growth. It also determine the various strategies and plans that are
being adopted by the government to overcome the problems and challenges. It analysis how TUI
group can benefit the UK government tourism to get recovered from its effects and attain
profitability.
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REFERENCES
Books and Journals
Abid and et.al, 2021. Towards environmental sustainability: exploring the nexus among ISO
14001, governance indicators and green economy in Pakistan. Sustainable Production
and Consumption, 27, pp.653-666.
Boğan and Çalışkan, 2021. A literature review of the most influential pandemics and their
impacts on the tourism industry. COVID-19 and the Hospitality and Tourism Industry,
pp.30-40.
Chua and et.al, 2020. Tourists’ outbound travel behavior in the aftermath of the COVID-19: role
of corporate social responsibility, response effort, and health prevention. Journal of
Sustainable Tourism, 29(6), pp.879-906.
Duan and et.al, 2020. Construction and application of therapeutic metal-polyphenol capsule for
peripheral artery disease. Biomaterials, 255, p.120199.
Leighton and McKeown, 2020. Work in challenging and uncertain times: The changing
employment relationship. Routledge.
Lew and et.al, 2021. Global tourism and Covid-19: Implications for theory and practice.
Routledge.
Li and et.al, 2021. Urban and rural tourism under COVID-19 in China: research on the recovery
measures and tourism development. Tourism Review.
Palm and et.al, 2019. Earthquake insurance in California: environmental policy and individual
decision-making. Routledge.
Song and Zhou, 2020. The COVID‐19 pandemic and its impact on the global economy: what
does it take to turn crisis into opportunity?. China & World Economy, 28(4), pp.1-25.
Van Holm, E.J. and Wyczalkowski, C.K., 2019. Gentrification in the wake of a hurricane: New
Orleans after Katrina. Urban studies, 56(13), pp.2763-2778.
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