Strategic management in travel and tourism

STRATEGIC MANAGEMENT IN TRAVEL AND TOURISM Group 3  Nguyễn Thị Huyền Trang  Hoàng Thị Minh Ngọc  Lê Thị Loan  Nguyễn Thị Thùy Linh  Đào Thị Thanh Xuân Chapter 7 : The external environment for travel and tourism organizations – the macro context Contents Contents 1. Introduction of macroenvironment 2. STEEP analysis 3. The relationships between the STEEP influences 4. Using the STEEP analysis Contents 1. Introduction of macroenvironment What is the macroenvironment?  The broad environment outside of an organization’s industry and markets. • Beyond the influence of the individual organization but can have significant impact on the microenvironment • Beyond control.  Bring about the birth or death of an entire industry, make markets expand or contract, determine the level of competitiveness  A vast amount of information Conducting macro-environmental analysis Scanning Monitoring Forecasting Assessing Scanning macro- environments for warning signs and possible environmental changes that will effect the business Conducting macro-environmental analysis Scanning Monitoring Forecasting Assessing For specific trends and patterns Conducting macro-environmental analysis Scanning Monitoring Forecasting Assessing Future directions of environmental changes. Conducting macro-environmental analysis Scanning Monitoring Forecasting Assessing Current and future trends in terms of the effects such changes would have on the organization. Limitations of macro-environmental analysis 1 2 3 Extremely complex and at any one time there may be conflicting and contradictory changes taking place The pace of change is increasing and becoming more turbulent and unpredictable Uncertainty has some doubt over the value of carrying out a macro-environmental analysis  Overview of the STEEP influences ◦ Complexity ◦ Four categories are interrelated and constantly interact with each other ◦ Because of the uncertainty of the effects of macro- environmental change on the microenvironment  identify and consider the possible outcomes of the changes 2. STEEP analysis [...]... Economic Physical Technical International Communications and infrastructure Administrative and institutional Legal and political Figure 7.1 Old and new tourism compared (adapted from Poon, 1993) Socio-demographic influences Social culture Demography Social structure Values, attitudes and beliefs) –its impact on demand for products and services, attitudes to work, savings and investment, ecology, ethics,... legal and regulatory influences Political risk  Particularly important in international business  Example: Thailand The relationships between the STEEP influences The example of environmental influences   A temptation when carrying out a STEEP analysis is to think of each influence as separate when in fact they are often interlinked A macro-environmental analysis should recognize the ways in which... Operational processes Information and communications Transport and distribution 4 Society, politics and economics Technological influences     Developments in information and communications technology Activities are better co-ordinated Research and development is speeded up Changes in transport technology have revolutionized business ; changed societies and cultures Economic influences Supply Revenue... environment Built environment Unifying characteristics Change of concern traffic congestion, deteriorating buildings and historic sites, poor urban planning, and visually intrusive buildings Environmental influences Natural environment Built environment Unifying characteristics Change of concern First, they all have international dimensions Second they are not exclusively tourism related but nevertheless... Economic policy Governementowned businesses Governement international policy Laws that influence employment, consumer protection, health and safety at work… Fiscal policy, set policy over the levels of taxation and expenditure Nationalized industries Government intervention to influence exchange rates, international trade Political, governmental, legal and regulatory influences Governement construct policy... the four STEEP factors might be linked to each other Using the STEEP analysis Scanning and monitoring Assessing Analysing Assessing What to analyse? The internal parts of an organization the effects of STEEP factors on the organization’s Core competences, strategies, resources, and value system An organization’s markets the effects of STEEP factors on product markets and resource markets ... Socio-demographic influences Social culture Demography Social structure •the impact of the size and structure of the population on the workforce and patterns of demand Socio-demographic influences Social culture the ways in which the social groups in a population are organized Demography Social structure by age, sex, location, population density in different areas, etc Technological influences Goods and services... services  Levels and patterns of demand  Costs of production and competitiveness Environmental influences Natural environment Built environment Unifying characteristics Change of concern Ecology and ‘green Issues” global climate change, ozone layer depletion, deforestation, extinction of species, soil erosion, desertification, acid rain, toxic wastes and water pollution Environmental influences Natural... Vary Economic influences When the fiscal & monetary policy work, they can affect:  Economic growth rates  Levels of income in the economy  Levels of productivity  Wage levels and the rate of increase in wages  Levels of inflation  Levels of unemployment  Balance of payments  Exchange rates Economic influences All of the factors above will affect:  People’s ability to pay for goods and services... of business activity:          Control of inflation Promotion of economic growth and investment Control of unemployment Stabilization of exchange rates Control of balance of payments Control of monopoly power, both by businesses and trade unions Provision of public and merit goods like health, education, defence, etc Control of pollution and environmental protection Redistribution of incomes . STRATEGIC MANAGEMENT IN TRAVEL AND TOURISM Group 3  Nguyễn Thị Huyền Trang  Hoàng Thị Minh Ngọc  Lê. competitiveness  A vast amount of information Conducting macro-environmental analysis Scanning Monitoring Forecasting Assessing Scanning macro- environments for warning signs and possible environmental. effect the business Conducting macro-environmental analysis Scanning Monitoring Forecasting Assessing For specific trends and patterns Conducting macro-environmental analysis Scanning Monitoring Forecasting Assessing Future