Transcript Strategic Management in Hospitality and Tourism

Strategic Management
in
Hospitality and Tourism
Kemal Birdir, Ph.D.
Mersin University
Turizm Faculty
DEFINING THE HOSPITALITY AND TOURISM
CONTEXT
• Services are becoming increasingly an important
part of the global economy. It is estimated that
on average 70 percent of the gross domestic
product (GDP) of the Organization for Economic
Co-Operation and Development (OECD) (2007)
countries come from service industries.
• It produces over 11 percent of the world’s gross
domestic product and employs over 10 percent of
the global workforce (UNWTO, 2003).
DEFINING THE HOSPITALITY AND TOURISM
CONTEXT
• Kandampully (2007) notes that hospitality organizations operate
within a network of service organizations. To a large extent, they
are interrelated and interdependent, and include the following:
–
–
–
–
–
Tour operators, travel agents, and tourism organizations
Travel and transport operators
Leisure, recreation, and entertainment venue
Restaurants, bars, clubs, and cafes
Hotels, resorts, motels, camping grounds, bed & breakfast (B&B)
establishments, and hostels
• Butler and Jones (2001) use tourism as an all-encompassing term
that covers all aspects of people being away from their home and
hospitality as a specific part of providing accommodations and
meals for tourists. They note that the one difficulty in their
definitions is that the hospitality industry also serves many people
who are not tourists, such as local residents
DEFINING THE HOSPITALITY AND TOURISM
CONTEXT
• In this book, to get a broader view and include all of
the different types and sizes of organizations in the
field, we use the terms hospitality and tourism
interchangeably. Thus, these terms encompass travel,
accommodations, food services, clubs, gaming, theme
parks, attractions, entertainment, recreation,
conventions, and nonprofit tourism organizations such
as national tourism offices, destination management,
and marketing offices.
• It is clear that the H&T industry is a composite of a
number of distinct industries that are closely
interrelated and interdependent. These industries
operate within a global network.
TYPES OF HOSPITALITY AND TOURISM
ORGANIZATIONS
•
In terms of their primary services, organizations can be categorized as follows:
–
–
–
–
–
–
•
•
•
•
1. Travel and transport
2. Accommodations (lodging)
3. Food and beverages
4. Entertainment and recreation
5. Tourism offices or destination management organizations
6. Nongovernmental tourism organizations
each can be further broken into several subgroupings. For example, under
accommodations, there are hotels, motels, guest houses, hostels, villas, and timeshares. Some of these organizations can be further grouped depending on their service
level, such as luxury hotels, boutique hotels, midmarket hotels, and budget hotels, or
according to their star ratings, such as five-star (diamond), four-star, and three-star
hotels.
A further grouping of the H&T organizations can be made based on their size such as
small, medium, and large. Independent and flexible small and medium-sized
enterprises (SMEs) dominate the tourism market worldwide.
Another classification of H&T organizations can be made according to profit motive.
Finally, H&T organizations can be further grouped based on their geographical
coverage. These include local, regional, and global firms. Local organizations operate in
only one city or country, whereas regional organizations operate in only a geographical
region such as Europe, the Middle East, or North America.
CHARACTERISTICS OF HOSPITALITY AND
TOURISM ORGANIZATIONS
• 1. Inseparability—customer participation in the
service process
• 2. Simultaneity
• 3. Perishability
• 4. Intangibility (the tangible–intangible
continuum)
• 5. Heterogeneity
• 6. Cost structure
• 7. Labor intensive
Table 2.1 Areas Where the Industry
Characteristics Impact on Managing H&T Firms
•
•
•
•
•
•
•
•
•
•
•
1. Analyzing the internal and external environment as an ongoing process
2. Making decisions in the areas of service delivery, pricing, and marketing
3. Strategic planning practices
4. Developing a sustainable competitive advantage
5. Achieving and evaluating intended outcomes
6. Managing capacity to maximize revenue
7. Managing the cost structure of the company
8. Allocating available financial and human resources for future strategies
9. Evaluating and improving the service delivery process
10. Interacting and satisfying customers
11. Training, developing, and motivating employees and managers (our
internal guests)
• 12. Designing and decorating facilities
THE CASE FOR STRATEGIC MANAGEMENT IN
H&T ORGANIZATIONS
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
Table 2.2 Areas Where Strategic Management Can Help H&T Organizations
Providing a holistic view for the entire H&T organization
Providing a sharper focus on what is strategically important
Providing a link between the external environment and the internal environment
Analyzing a complex and rapidly changing external environment
Analyzing an organization’s strategic resources
Giving a clear sense of strategic vision and direction
Defining organizational purposes
Developing measurable goals and objectives
Identifying key resources and investing in core competencies
Formulating decisions and making them happen
Managing change
Coordinating organizational activities and allocating resources
Understanding the complexities of decision making and the structuring of an
organization
Understanding the role and importance of the organizational structure and culture
on the strategy process
Reducing and managing uncertainty inside the organization
Measuring intended and unintended outcomes of the strategy process