Unit 6 : Contemporary Issues in Travel and Tourism

This is solution of Contemporary Issues in Travel and Tourism Assignment given in UK College of Business and Computing

Introduction

The world around is a continuously transforming place and the issues, which have an effect on the travel and tourism industry differ from place to place and on day to day basis (Poon, 1993). The travel and tourism industry is continuously advancing and progressing with the number of customers increasing with every passing day (Evans et. al., 2003). The industry has shown high progress in terms of profits, revenues and products and services (Loretto et. al., 2010). However, at the same time the industry faces several challenges and issues that must be handled effectively by the companies operating in this industry. Taking the above discussion into consideration this particular paper attempts to highlight the current issues in the travel and tourism sector; how the travel and tourism sector responds to change in Romania and finally, the impacts of change on the travel and tourism sector.

Task 1

Understand current issues in the travel and tourism sector

The business world has transformed significantly during the period of last 10 years, however few issues and challenges that were experienced by the travel and tourism sector during the beginning stages of 1990's still prevail (Loretto et. al., 2010). The setting in which the sector functions, requires that tourism stakeholders essentially move their strategic strategy not just to solve long-standing problems but more significantly to, efficiently deal with present issues and exploit on new prospects (Evans et. al., 2003).

Moreover, changing demographics, volatile economic situations and shifting travel patterns are incrementing the pressure on market stakeholders in order to devise efficient campaigns along with business approaches (Knowles et. al., 2004). More lately, safety and health issues like global security and pandemics issues, have incremented the urgency for sector action (Evans et. al., 2003). The issues faced by the travel and tourism sector are numerous and complex. Dealing with such issues would call for a high amount of cooperation and coordination to organize resources more efficiently. Further, this section throws light on the issues currently driving change in the travel and tourism sector and examines different current issues using appropriate methods and resources.

1.1 Analyse issues currently driving change in the travel and tourism sector

The issues currently driving change in the travel and tourism sector include:

Lack of proper infrastructure - Infrastructure requirements for the tourism and travel sector range from physical framework like entry ports to transport modes to urban framework like access roads, electricity, sewerage, water supply and telecom (Evans et. al., 2003). The industries associated with the travel and tourism sector take in airlines, accommodation (hotels), surface transport and facilitation systems, amongst others (Knowles et. al., 2004).

Human resource - Availability of competent human resource is a key challenge experienced by travel and tourism sector, one amongst the greatest generators of employment all through the world (Knowles et. al., 2004). In order to sustain advancement within the tourism and travel sector, trained workforce/ manpower is needed at each level i.e. managerial, competent, supervisory or semi-competent. Challenges experienced at every level are diverse. At top and mid-levels of management, the sector experiences talent crisis and at the level of front-line staff, even though human resources are sufficient, a advancement within other service sectors like banking, airline, retail and BPO have led to manpower shortage at this level of the tourism and travel sector (Evans et. al., 2003).

As a result, there exists a mismatch between demand and supply in terms of manpower within the tourism and travel industry worldwide. Such a high percentage of inexpert human resources could adversely impact the service quality put forward for the travellers (Tribe, 1997). Further, absence of tourism training structure, attrition, competent trainers and absence of effective approaches and guidelines for human resource management development also have an impact on the sector. The sector must deal with such issues at the earliest.

Service level - Apart from hotel staff and tour operators, customers interact with persons belonging to different occupations, backgrounds and experience (Tribe, 1997). These people take in immigration staff, coach/taxi operators, travel/ ticketing agencies, hotels and tour guides amongst others. The levels of service provided by these several individuals holds a high effect on deciding the overall experience of the tourists (Knowles et. al., 2004).

Rising cost of fuel - Tourism and travel industry is greatly reliant on fuel costs (Loretto et. al., 2010). The latest increase in the fuel price like gasoline has a high effect on the whole sector. With the fuel cost on continuous increase, many customers might need adjusting their spending or length of the vacation length so as to pay for added fuel costs (Evans et. al., 2003). The companies operating in this industry take this challenge into consideration and look for creative ways to deal with it.

Taxation - Travel and tourism sector is a highly-taxed sector. The high level of taxes affects the industry growth. Several taxes are impose across the whole industry beginning from tour operators, airline sector, transporters to hotels and these take in luxury tax, service tax, transportation tax, aviation tax and several taxes on transportation (Tribe, 1997). Additionally, all these tax rates are likely to differ from region to region.

Lack of Differentiation - Worldwide standardization has resulted in less unique products and services. The globalized market implies that frequently same products and services are offered all through the globe. As a result, the sameness factor is considered as being a chief challenge faced by travel and tourism industry (Loretto et. al., 2010). There exist a large number of companies operating in this industry offering similar services and products. Thus, the level of competition is very high in this sector and customers are likely to switch to any other company offering services quality services at comparatively lower price than the former.

1.2 Analyse different current issues using appropriate methods and resources

The different issues discussed in the above sections can be analysed by making use of different methods and resources. The methods and resources include both primary and secondary sources. First of all, primary sources involve analysing the market by conducting surveys and employing observation techniques. Secondly, the secondary sources would include gathering information from diverse sources such as books, online texts, journals and others.

Task 3

Understand how the travel and tourism sector responds to change

Managing and responding to change refers to the procedure of devising the decisions make and plans and then undertaking the actions needed to put into practice those decisions and plans to result in a new, diverse set of behaviours within a team of individuals operating collectively within a company. Responding to change is not a simple task. The section explores the situation in Romania. This particular section of the paper highlights how travel and tourism businesses could respond to change; puts forward strategies on how selected travel and tourism entrepreneur could respond to change and lastly, provides justification for how selected travel and tourism businesses could respond to change

3.1 Analyse how travel and tourism businesses could respond to change

For any business, be it, travel and tourism or retail management, it is highly important to respond effectively to change (Anderson and Anderson, 2001). Taking into consideration the travel and tourism industry in Romania it is necessary for businesses to have in place sound change management strategies. In order to manage and respond to change, first of all a set of objectives and goals needs to be accomplished (Knowles et. al., 2004). This is essential for providing cohesive criteria for success once accomplished. After this, a plan needs to be developed having sufficient details to outline what all steps need be taken on and how such actions need to be executed so as to move the company towards the accomplishment of its objectives and goals (Anderson and Anderson, 2001). Even though, the previous steps appear straightforward and clear but they are not.

Frequently individuals, management and corporations fail to not recognize how to efficiently manage, since the cause and impacts of their acts are alienated by high time that the link amid them is hidden and there is no learning (Anderson and Anderson, 2001). To efficiently respond to change, four key points need to be considered as valid in Romania. Firstly, there is a lot to be learned by exploring the past or several mistakes would be again repeated (Evans et. al., 2003). Secondly, individuals are considered as being the highly significant factor in success, still they are frequently mistreated (Branson, 2008). Thirdly, technology is necessary but not enough for success in the absence of cooperation and involvement of people (Anderson and Anderson, 2001). Fourthly, knowledge is power. Education, communications and information  pooled with experience is the knowledge source.

3.2 Develop strategies on how selected travel and tourism businesses could respond to change

The below sections throw light on strategies on how travel and tourism companies could respond to change.

Deciding on the Change Goal

It is highly necessary for the companies operating in Romania to make sure that the change goals are clearly stated (Anderson and Anderson, 2001). The companies must have in place a clear vision. For change to happen, it helps if the whole company really wants it (Branson, 2008). Develop a sense of urgency around the need for change. This may help you spark the initial motivation to get things moving and quality management.

Consider Timing - The companies operating in Romania needs to think about the most appropriate time to instigating change (Loretto et. al., 2010). The higher the level of change required, the more constructive it is to instigate the change on any perceived or actual crisis (Anderson and Anderson, 2001). For instance, enhancements within work practices might be more suitable during recession at the time when individuals are concerned for keeping their jobs.

Forming a Sound Coalition - Convince employees that change is needed. This frequently requires visible support and strong leadership from chief people in the company (Branson, 2008). Managing change is not sufficient there exists, the need to lead it.

Creating Change Vision - When the company first starts thinking regarding the change, there would possibly be several great solutions and ideas present around (Anderson and Anderson, 2001). The companies connecting these conceptions with the general vision which individuals could grasp effortlessly and memorize (Loretto et. al., 2010).

Communicating the Vision - The company should communicate its vision on regular basis and should be embedded in everything it does (Branson, 2008).

Creating Short-run Wins - Nothing encourages higher than success. People should be aided to view the advantages associated with change during the short term (Anderson and Anderson, 2001). For instance, if the company is modifying the way it could interact with clients, it could highlight few of the constructive feedback from them in order to motivate employees to carry on with the latest working ways.

Building on the Change - Several change initiatives are unsuccessful since victory is announced quite before (Kotter, 1998). Actual change occurs deep. Speedy wins are just the start of what must be carried out to accomplish long-term change (Branson, 2008).

Anchoring Changes within Corporate Culture - So as to make any change to remain, it should become fraction of the heart of the company (Anderson and Anderson, 2001). The corporate culture frequently decides what requires to be done, so the standards behind the vision need to be present in everyday tasks.

3.3 Justify strategies for how selected travel and tourism businesses could respond to change

Forming a powerful coalition - One can locate efficient change leaders all through the companies in Romania. They do not essentially tag along the traditional corporation hierarchy (Loretto et. al., 2010).  In order to lead change, there exists the need to put together a team or coalition of influential individuals whose power arises from several different sources, taking in job title, expertise, status and political significance (Kotter, 1998). Once built, the "organizational change coalition" must function like a team, persisting to build momentum and urgency around the requirement for change (Anderson and Anderson, 2001).

Creating Change Vision - A comprehensible and clear vision could aid everybody in understanding why they are being asked to do something (Branson, 2008). At the time when individuals view for themselves what the company is trying to accomplish, then the directives they are provided are likely to form higher sense (Loretto et. al., 2010). Companies in Romania could do this by determining the values, which are important for change; developing a short summary that outlines the possible future of the company and creating a business strategy to implement that vision (Branson, 2008).

Communicating the Vision - The companies should just not arrange special meetings for communicating the vision but it should be talked about and discussed often and as and when possible (Loretto et. al., 2010). The vision should be used every day to form decisions and resolve issues. It is important for companies to talk frequently regarding the change vision; deal honestly and openly with concerns and anxieties of the employees and lastly, applying the vision to every aspect of the operations – from performance reviews to training (Branson, 2008).

Creating Short-run Wins - The businesses operating in Romania should also devise short-term goals, than forming just one long-term objective (Loretto et. al., 2010). The businesses should ensure that every smaller target is attainable, with less chances of failure (Kotter, 1998). The change team must put in high efforts to come up with such objectives. However, every "win" that is produced could further encourage the whole staff.

Building on the change - Introducing one new product or service by making use of a new system is good. However, if the company could introduce ten new products or services it implies that the new system is functioning. In order to reach that 5th success, the companies must continue looking for enhancements. Every success puts forward an opportunity to decide on what went correct and recognize what the companies could further enhance (Anderson and Anderson, 2001). Subsequent to each win, the companies should examine what went correct and what requires improvement. Then the companies should set objectives to continue developing the impetus they have accomplished.

Anchoring Changes within Corporate Culture - It is important for companies in Romania to make incessant efforts to make sure that the change is observed within each facet of the company (Kotter, 1998). This would aid in giving that change a sound place within the company’s culture. It is also necessary that the corporation’s leaders persist to direct the change (Branson, 2008). This involves present employees along with new leaders who are introduced. If the support of these people is missing, the company might end up back from where it began.

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Task 4

Understand the impacts of change on the travel and tourism sector

Effectively managing and responding to change is considered as being an important part of the travel and tourism industry (Loretto et. al., 2010). The change element can have a high impact on the operations and functioning of the companies within the travel and tourism sector. Likewise, this particular section of the paper analysis the impacts of issues and trends that drive change in the travel and tourism sector and discuss the likely consequences of businesses failing to respond to market changes.

4.1 Analyse the impacts of issues and trends that drive change in the travel and tourism sector

As discussed in the above sections there are several issues that drive change in travel and tourism industry. The below will now highlight the impacts of these issues and trends in the travel and tourism industry.

Lack of proper infrastructure - Infrastructure requirements for the tourism and travel sector range from physical framework like entry ports to transport modes to urban framework like access roads, electricity, sewerage, water supply and telecom (Tribe, 1997). Lack of infrastructure can have a high impact on the efficiency and functioning of the companies within travel and tourism industry. In the absence of proper infrastructure the operations of the company could not be carried out with full efficiency (Loretto et. al., 2010).

Human resource - Availability of competent human resource is a key challenge experienced by travel and tourism sector, one amongst the greatest generators of employment all through the world (Knowles et. al., 2004). Continuously advancing technology and business operations has increased the need for having competent staff in place, which can properly use and understand the new technology. Even if the company has successfully adopted a new technology but it does not expert staff, maximum advantage might not be attained.  As a result, there exists the need for continuously updating employees with new techniques and operations (Knowles et. al., 2004). In addition, the companies should also make sure that adequate provisions and proper treatment is given to the human resources so that they stay with the company for long. It is always preferred to retain the existing expert staff than spending resources on finding new ones (Tribe, 1997).

Service level - Apart from hotel staff and tour operators, customers interact with persons belonging to different occupations, backgrounds and experience. The service level in travel and tourism industry must be very good. The employees should be very helpful and co-operative. In case of poor service levels the customers might show reluctance for any particular travel and tourism company (Loretto et. al., 2010).

Rising cost of fuel - Tourism and travel industry is greatly reliant on fuel costs. With the fuel cost on continuous increase, many customers might need adjusting their spending or length of the vacation length so as to pay for added fuel costs. Thus, this requires companies to look for ways they can manage the rising fuel cost at the same time retain their customers (Knowles et. al., 2004). This considered as a big challenge today particularly in the presence of so many companies operating in travel and tourism sector offering similar services and products.

Lack of Differentiation - Lack of differentiation is considered as being a chief challenge faced by travel and tourism industry. Due to presence of several small and large companies offering similar products and service the level of competition is quite high in travel and tourism industry (Loretto et. al., 2010). It requires that the companies develop and offer innovative products and services on continuous basis otherwise they might lose their market position (Olsen, 2004).

4.2 Discuss the likely consequences of businesses failing to respond to market changes

The business atmosphere in which companies function lies external to them. It’s their outside atmosphere that is at all times changing. Few changes are so remarkable that everyone observes them (Loretto et. al., 2010). However, others might creep up on the sector over the period of years and be highly overlooked for quite long (Kotter, 1998). There is no doubt in the fact that the businesses today are continuously faced with the challenge of managing and responding to change. The companies failing to effectively respond to market changes are adversely affected on different fronts like they might lose customers, sales might go down, profit level might decrease and they might also lose their market position. As the business world around is highly competitive, the companies need to have in place proper strategies to respond to and accept market change in order to ensure long-term existence and sustainability (Kotter, 1998).

Conclusion

To conclude, it can be clearly stated from the above discussion that travel and tourism industry has become an important contributor of the global economy. Tourism and travel professionals are very well familiar with the fact that their sector is exposed to a number of issues (Harrison and Enz, 2004). Frequently it is observed that these issues and challenges are not in control of the tourism and travel professionals. Despite the fact that to some level sector leaders are compelled to respond to situations not in their control, a knowledge about current issues could help the companies to prepare for upcoming issues and to look for ways to diminish the unconstructive effect of exigent situations (Loretto et. al., 2010). There exists the need for companies to effectively deal with these issues and respond to change. Failure to do so can have a negative impact on the productivity and profitability of the industry. Further, this particular paper highlighted the current issues in the travel and tourism sector; how the travel and tourism sector responds to change and finally, the impacts of change on the travel and tourism sector.

References

Anderson, D. and Anderson, L. A. (2001). Beyond Change Management: Advanced Strategies for Today’s Transformational Leaders. San Francisco: Jossey-Bass/Pfeiffer Branson, C. M. (2008). Achieving organisational change through values alignment. Journal of Educational Administration, 46(3), 20-34 Evans, N., Campbell, D. and Stonehouse, G. (2003). Strategic Management for Travel and Tourism. Oxford: Butterworth-Heinemann Harrison, J. S. and Enz, C. A. (2004). Hospitality Strategic Management: Concepts and Cases, Wiley, Chichester Kotter, J. (1998). Leading Change: Why Transformation Efforts Fail. Harvard Business Review Knowles, T., Diamantis, D. and El-Mourhabi, J. B. (2004). The Globalisation of Tourism and Hospitality: A Strategic Perspective (2nd ed.). London: Thomson Loretto, W., Platt, S. and Popham, F. (2010). Workplace change and employee mental health: Results from a longitudinal study, British journal of management, 21, 526-540 Olsen, M. D. (2004). Literature in Strategic Management in the Hospitality Industry. International Journal of Hospitality Management, 23, 411-424

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