Analysis of TUI Group's Business Environment During COVID-19

This case study analyzes the impact of the COVID-19 pandemic and the UK government's recovery plan on TUI Group's business environment. It begins with an introduction to the business environment and its importance, followed by an overview of TUI Group's size, sector, competitors, and leadership. The study then examines the pandemic's effects on TUI's internal, micro, and macro environments, including travel restrictions, falling consumer confidence, and financial impacts. The analysis also covers the UK government's recovery plan and its influence on TUI's operations. Furthermore, the study employs STEEPLE factors (Social, Technological, Economic, Environmental, Political, Legal, and Ethical) to assess the broader impacts on TUI's operations, concluding with an overview of the key findings and implications of the case study. The analysis emphasizes the importance of understanding internal and external factors for business success in the tourism and hospitality industries.

Business Environment

TABLE OF CONTENT
INTRODUCTION ..........................................................................................................................3
Section 1...........................................................................................................................................3
Section 2 ..........................................................................................................................................5
The impacts of the Covid-19 Pandemic on TUI Group’s internal environment..........................5
impacts of the UK government’s recovery plan on TUI Group’s internal environment.............5
REFERENCES................................................................................................................................6

CASE STUDY REPORT
INTRODUCTION
As we all know that business environment dynamics have significant impact on the
business performance, its relationships with stakeholders and its strategic direction. For instance,
it is necessary for companies to analyse the impact of environmental dynamics, uncertainties and
fluctuation. The reason behind that it recent COVID-19 pandemic which has impacted the
business operations. The present report will be based on TUI group which is one of the most
popular brand or you can say leading tourism businesses (Schäfer, 2020). The main aim of the
case study is show some highlights on how pandemic has impacted TUI group's macro, micro
and internal environments in a negative and positive ways. Internal business environment is a
component which is composed of different types of elements presented in the company, that can
impact or can be impacted with various aspects such as business activities, decisions and the
choices of the firm. Talking about macro business environment, means how external factors or
any conditions relating to macroeconomic will impact the business operations as well as business
performance. Micro business environment, is all about the environment which is in directly
linked with firm and impacts the daily routine activities related to business. By understanding the
internal and external factors the company can know about how these factors are close to the
business and how it can influence the performance of employees as well as the daily business
transactions or operations of TUI group.
Section 1
Business overview, Size and sector
TUI group is one of the leading group which operates at international level in the tourism
and hospitality industry, headquarters situated in Germany. The company offers wide range of
services related to tour, such as online booking of flights, cruises, hotels and resorts (Nieminen,
2018).
The company offers various facilities related to hotels, there are total 300 hotels with
almost 214000 beds. In addition, it has 1600 travel agencies and 6 airlines. The company offers
effective tour packages to attract customers who like to travel the world. In addition, it offers
affordable flight tickers and hotel packages so that customers will have premium experience
during their travel. Talking about its total revenue, it is almost 473.2 cr EUR in the year 2021.
TUI airways is certified as a 3 start leisure airline for its quality service performed by staff

members for its customers. TUI group is a public limited private sector organization operating in
over 180 countries with talented and skilled staff members. The company offers amenities,
cleanliness, food and beverages as well as cabin service. Speaking about its market cap, the
company has 3.16 billion. Due to this, the company has achieved the title of world top 3000th
most valuable firm in terms of market cap . Also, the share price of the company is high: 148.65
GBP which is quite good figure in the travel and tourism sector. The customer base of the
company is almost 30 million as the firm offers various facilities to them. TUI group follows
hierarchical organizational structure in order to perform decision-making process and flow of
information from the top to bottom level (Schäfer, 2020).
Direct and indirect competitors
Talking about its competitors, there are many competitors who provide quality services
and existing offers to customers.
Basis of difference TUI group Thomascook.com Holidaybreak
Type of company Leisure travel services Tours and travels
company
Travel group
Revenue $5 billion $84 billion $490 million
USP Supports the product
growth
One stop solutions for
all travel issues
Exclusive
programmes
Number of employees 50584 608 Availability of
adequate employees
Strategy Segment strategy Brand building Focusing on target
audience via
marketing strategy
Organisational
structure
Hierarchical structure Vertically integrated
with a top-down
management structure
Functional
organisational
structure
Leadership team
As we all know that leaders plays a vital role in the success of business, with the help of
leadership style they motivate people to work effectively towards company goals. They direct

employees and guide them to perform and innovate which helps them to succeed in the
professional career (Buijtendijk, van Heiningen and Duineveld, 2021). The leadership team of
the TUI group is talented, having good experience and skills which helps them to achieve their
market position. The company uses open communication and people centred leadership style
which is one of the most popular style in the travel and hospitality sector. Senior management
team of the firm understand the importance of voice raised by employees and try to solve
concern raised by them. They use effective solutions and methods to employee engagement
which helped that to achieve business success. They are more focused on key issues related to
employees. This creates the strong relationships between leaders and employees. By following
democratic leadership style, the company is able to encourages participation of employees. The
reason behind choosing this style for team is that it helps in inviting participation and
involvement from people.
Section 2
The impacts of the Covid-19 Pandemic on TUI Group’s internal environment.
As we all know that recent years were very difficult for travel industry, there were some
travel restrictions, falling of consumer confidence, flight suspensions as well as fall in profits.
Likewise, other travel industry, covid-19 pandemic has affected the business operation as well as
internal environment of the TUI group (Aburumman, 2020). During the pandemic time all the
holiday packages have been cancelled many people have lost their bookings. The business
culture also get impacted by pandemic, because it has also hinders the performance of
employees. Due to this decision-making process of an organization also gets highly impacted.
The major changes have been noted in quality of human resources which has influenced the
organizational culture as well as style of functions of top management.
impacts of the UK government’s recovery plan on TUI Group’s internal environment.
In order to deal with such difficult situation, government of UK has designed recovery
plan for travel industry (The Tourism Recovery Plan, 2022). The tourism recovery plan ensure
that the tourism sector is well-placed so that they can Reach their potential customers and able to
contribute to the ambitions set by government for growth. This recovery plan has helped travel
and tourism industry, as it provides support in growing accommodation occupancy rates even in
the off-season. In addition, it has also helped internal environment of the company such as

culture, human resource, customers, policies, systems, strategy as well as mission. This is how
government of UK, supports this industry and rebuild tourism sector for the future development.
SECTION 3
UK government's recovery plan impact on the TUI Group's micro environment
The recovery plan of the UK government includes the goal of creating the UK's position
as one of the most effective destination of tourism in the world. For the local economic visitors
the government of UK has emphasised the importance of investing in the structure foundation of
tourism and investing in the facilities of transportation. In the program of the recovery plan, TUI
is hiring the experience professionals. Marketing, sales, finance, product development and much
expertise field were welcomed for the process of recruiting (Teko and Lah). To the particular
business the program of the tourism recovery is building industry potential to deliver the plan of
development. Every ten jobs in the world were responsible as the industry of tourism is
contributing 10 percent to the global economic output. The CEO of TUI said that due to the
frequent changing policies of the UK it impacts the travellers of British due to the uncertainty of
pandemic. Since may 2021 the 4.2 million customers has booked the summer trips in 2021. 1.5
million bookings were increased in June. Compared to the pre-pandemic summer season of 2019
there is a decrease in the booking by 68 percent in the year 2021.
Covid-19 Pandemic impact on the TUI group's micro-environment
Covid-19 pandemic impact all the organization in the world. Due to the impact of the
pandemic most of the companies adapted a model of assessing the light business. Across the
landscape of the traveller the pandemic impacts in the long term such as it occurs the drastic
change. The suspension of the cruise and the holidays were extended by the TUI. To the 11 June
the package holidays were cancelled. The result of Covid has cancelled up to 900,000 holidays
by the travel giant (Lahaye, 2021). Compared to the last summer season booking were down by
59 percent announced by the TUI. The cancellation fees were waived by the TUI. TUI also
offered the customer bonus of 20 percent if they rebooked the trip and they do not ask for the
refund. With the guidance of the ABTA it provides customers the Refund credit notes separately.
As getting the incentive more customer will not ask for the refund and will request for the credit
note. Cash can be conserved by the intermediary of travel through this.

SECTION 4
STEEPLE factors impact on TUI Group's operations
The factors which impact the TUI group's operations are the political, economical, social,
technological, legal and the environmental factors.
Social Factors- The factors which impacts the TUI are the concerns regarding the health and
safety attitude, hierarchy and the norms of the society, roles of gender, demographics and the
leisure interest. The TUI home market is different from the UK society. To serve better to the
customers of UK, company should build a strive by building a local team (Aburumman, 2020).
Technological Factors- In UK the process of research and development investments are both at
macro and the micro level. The inLahaye, A., 2021crease in the speed and access in the
development and enhancement should be identified by the TUI. More people will invest in the
company if the intellectual property rights were higher safeguard in the company.
Economic Factors- The success and the fall of the business were influenced by the economic
factors. The rate of unemployment increased up to 4.1 percent as compared to last year it was
higher by 0.3 percent. The rate of unemployment benefits the TUI group as it gets the workforce
choice in the good amount of people for the company with the certain positions.
Environment Factors- To make the supply chain more flexible TUI should have to invest more.
The cost of operations were increasing due to the extreme weather (Stevenson and Marintseva,
2019). TUI operation cost also increased due to the regular scrutiny by the agencies of
operations. In the urban areas the government of the UK has launched a strict norm regarding the
management of waste.
Political Factors-The profit of the TUI operation may be affect due to the influence of political
factors. The factors like civil war and the civil unrest may also impact the company's
performance. There is the risk of the invasion of military, it should consider the protection of the
intellectual property. To the travel industry stability of the political environment is important to
the economy of the country. Company should consider the labelling of product and the other
requirements in the travel sector.
Legal Factors- In UK the legal factors which impacts are the patent, copyrights and the other
rights. TUI should consider the UK data protection laws as protection of the data is the critical
part from the decades. TUI should meet the laws and regulations of the UK. Before entering the
international market TUI should consider the specific cases such as to consider the average time.

CONCLUSION
Thus, it has been concluded from the above case study that the impact of the external
factors in the operation of the business. The case study included the definition of the micro and
macro business environment and the internal business environment. Further, the case study
included the TUI group size, overview of business, operation of industry and the sector, etc. The
impact of Covid-19 on the TUI micro and internal environment was studied. Further, the impact
of recovery plan of UK on the TUI internal and micro-environment was studied. The case study
also include the STEEPLE factors on the operations of TUI.
To improve the micro, macro and the internal factors, TUI group should consider the
recovery plan of the government to process its tourism business properly. Proper identifying of
the micro and the macro environment factors help the organization in generating the profit. Even
in the off season the recovery plan of the government help the tourism business in generating
profit. To attract the customers the TUI group is hiring the professional customers for the
business. There should be a proper research on the PESTLE analysis to identify the impact of the
macro environment factors on the operations of the TUI group.

REFERENCES
Books and Journals
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.
Buijtendijk, H., van Heiningen, J. and Duineveld, M., 2021. The productive role of innovation in
a large tourism organisation (TUI). Tourism Management. 85. p.104312.
Lahaye, A., 2021. Club Med and Covid 19: confronting the crisis in the tourism sector: digital
marketing solution.
Nieminen, A., 2018. Sustainability in TUI Experience Centre.
Schäfer, J. C., 2020. The case of TUI: sailing into a bright future or sinking like Thomas
Cook? (Doctoral dissertation).
Stevenson, I. and Marintseva, K., 2019. A review of Corporate Social Responsibility assessment
and reporting techniques in the aviation industry. Transportation research procedia. 43.
pp.93-103.
Teko, E. and Lah, O., Recovering from the COVID-19 Crisis: How the EU, Germany, and
France Plan to Build Back Better. Assessing the Impacts of COVID-19. p.67.
Online
The Tourism Recovery Plan. 2022. [online] : available through
<https://assets.publishing.service.gov.uk/government/uploads/system/uploads/
attachment_data/file/992974/Tourism_Recovery_Plan__Web_Accessible_.pdf>