FDY3002 Exploring the Business Environment Case Study

Introduction - FDY3002 Exploring the Business Environment Case Study

Business environment is collection and sum of the internal and external factors. The specific forces mainly involve the suppliers, competitors, consumers and investors. These factors mainly put impact on the individual enterprises immediately and directly as well within daily working. The general forces involve the technological, legal, political and social conditions. The report will offer expert guidance to the Amar and his TraveTales. It is one of the Travel agency which is mainly having the challenges related to the profitability (TraveTales, 2023). As the consultant of management, would effectively evaluate how the external and business environment affect the overall operations. The internal business environment is about the aspects in organization, it includes the financial management, human resources and operations and these can put impact on the performance. The external business environment focuses in the different external aspects which include the legal requirements, economic trends and market conditions. By effectively understanding the environment will play major role for Amar and he can boost the performance and adapt the strategies of the Travel Tales. Through resolving the areas, the organization can gain again the position and competitive edge. The report will shed light on the identification of the problem within the TravelTales. Moreover, it will propose the solutions as well.

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Problem identification

Internal business environment factors: The internal business refers to the aspects within the organization which can easily control; this includes the financial, business procedures, technology and staff. For instance, Manual booking systems and proper staff training lack within the travel industry are the major issues which adversely impacts the consumer satisfaction and thereby overall business performance.

Inefficient technology and operations: The TravelTales depend on the outdated software, manual procedures; it is leading to the inefficiencies and errors within the booking management. The Bookings manual handling has outcome within frustrating consumers, refunds, cancellations and errors. The different inefficiencies affect the consumer relationships, waste time and boost the prices of operation.

Poor Human resource management: Lack within the managerial experience of Amar, this is mainly resulting in the high turnover, low morale and unclear roles among the workers. The workers mainly find out the uninspiring and work repetitive (Johnson et al, 2020). The staff’s active search for jobs, developing sick leaves and resignations are occurring because of the low growth opportunities and uncertainty. The workforce who is disengaged can put impact on the overall productivity and quality of consumer services of the business.

External business environment factors:This involves the different external aspects beyond the control of Amar which can affect the business performance. This includes the legal regulations, competition and economic conditions. For example, the pandemic impacted the disposable income of the consumers which in turn places direct impact to the Travel Tales.

Economic challenges in the travel industry: The COVID-19 pandemic influences have changed the budgets and travel preferences of the consumers. The travellers are developing the cautions related to the expenditure of travel. This mainly includes the exotic and high-cost destinations; these are primary offering of the TravelTales. The decline of the revenue from the year 2023 and less booking mainly showcase the downturn within the spending of consumers. It has mainly decreased the needs for the premium packaging within the TravelTales, making the challenges in cash flow.

Regulatory and legal Non-compliance: Amar mainly abandoned the ATOL license renew, the requirement of legal for the selling the services of air within UK. The ATOL license absence boosted the legal penalties risks, hinders the operations and undermines the trust of consumers (Shahzad et al, 2020). Lack of with the regulatory, the Travel Tales not able to offer legal services, it is major issue. This can put impact on the reputation and profitability.

Key business functions

Finances: It is about management of money which includes the activities like as forecasting, saving, budgeting, lending, borrowing and investing. The over dependency on the personal savings and down cash flow to cover the salaries can showcase the planning of poor financials. The lower rates of repeat booking and declining revenue highlight lack of stability within the financials. This has affected business’s sustainability and limits the growth investment capability.

Operations: This implies for the business processes to make sure that a business is functioning smoothly. The booking procedures which are manual are mainly error-prone and time consuming. The various errors leading to the cancellations and refunds frustrated consumers. It mainly affects the brand reputation, waste resources and inefficiencies.

Marketing: It refers to the set of activities include creating, communicating and delivering product to the target market. The limited utilisation of the social can reduce the potential consumer’s reach and dependency on the marketing methods which are traditional. The social media post of personal and word of mouth not developed major leads, along with the conversation rate which is only 10% from bookings meetings. The ineffective marketing can easily limit the consumer acquisition and brand visibility.

Human resources: Human resource is set of people who make up team and strive for fulfilling business objectives by performing activities in an innovative manner. The role clarity lack and poor recruitment and low morale of workers can lead to inefficiency and high turnover (Asemokha et al, 2019). This showcases the high rates of sick leaves and staff dissatisfaction as well. It mainly undermines the ability of business to retain talented workers and service quality.

Ethical considerations

Significance of the business ethics: The major ethics of business involves the principles which can govern the decision making and behaviour to make sure about the integrity, transparency and fairness. The effective ethical practices can boost the long term profitability, worker satisfaction and consumer trust.

Indentified ethical issues: By collaboration with the operators which are mainly underplay the staff within the unethical; this can harm the reputation of the TravelTales. If the consumers are be aware about the different practices. While the unethical and tempting practices might appeal the negative publicity, alienate the consumers who are socially conscious and affect the brand identity.

The business ethics mainly include the effective decision making which are socially and morally responsible while managing the profitability (David and Jane, 2019). The different ethical practices can boos the long term success, worker loyalty and consumer trust. Within the TravelTales case, the major offers from the operator of excursion increases the ethical concerns. By effectively selling the excursions can affect the brand values and credibility of the agency. Ethical suppliers engagement is align with the positive reputation and social responsibilities. These develop among the consumers who are focusing on the fair and sustainable business practices.

By resolving these external and internal challenges, Amar might boost the profitability and reposition the organization while aligning with the ethical standards.

Proposed solutions

In order to help the Amar to reduce the risks developed via external and internal factors and boost the effectiveness within the TravelTales. The section offers the effective solutions which emphasising on the leveraging the opportunities, identified issues and also making sure about the business ethical practices.

Resolving external and internal environmental factors

Internal factors:

Renew of the ATOL license: The Amar needs to quick renew the ATOL (Air travel organiser’s license). It would make sure about the restore of the consumer confidence and legal compliance within the business. This can focused to avoid the reputational and legal risks.

Upgrade automation and technology: Apply the effective CRM system (Consumer relationship management) to boost the consumer satisfaction, decrease the errors and streamline bookings. The Amadeus and Travel port platforms might operation optimise via offering the real time information and automating procedures.

Adoption of AI: Amar might adopt the tools powered by AI to increase the automation within the tasks like as itinerary planning, consumer inquiries and booking management. The Chabot of AI offers the consumer support for 24/7, developing the response time and decreasing the manual workload. Moreover, analytics based on AI can effectively track the behaviours and preferences of the consumers. This develops the consumer satisfaction, reduce the errors and streamline operations.

Feedback apps: Applying the apps to boost the creativity and innovation, this can offer help to organisation in collecting the real time feedbacks from the workers and consumers. The consumers can effectively provide the travel experiences, permitting the Amar to understand developmental areas and enhance the services to meet the needs of consumers. Workers can easily contribute their thoughts and ideas also developing engagement, morale and internal feedback mechanisms.

Boost employee skills: The organization needs to invest within the training programs for staff to boost the travel industry knowledge. By collaborating with the professionals of industry to conducts the certifications and workshops. This will make sure about the boost morale and staff competence.

External factors

Economic trends adoption: In order to counter the affect of the decreased income this is disposable. The Amar might introduce the packages based on the mid range mainly targeting the consumers from the middle income while retaining the options of high end (Nickels et al, 2019). The effective diversification would boost both stabilise revenue and consumer base.

Leverage digital marketing: The change emphasise on the digital strategies’ traditional methods. The paid advertisements via the Google and Instagram platforms, combined with the SEO, it will mainly appeal the consumers and boost the visibility (External Factors Affecting Business, 2023).

Leveraging opportunities

Internally: By effective introducing the programs of the loyalty providing the exclusive perks and discounts for the consumers repetition purchase. It might boost the rate of retention and stronger relationships as well. By developing the paths for the career growth and make the clear roles for the staff (Ciampi et al, 2021). The ongoing meetings of team to discuss the feedback and challenges would boost the work environment based on the collaboration.

Externally: Partnership with the local businesses, airlines and high end resorts to provide the effective and exclusive deals. The partnerships mainly boost the value of packages of TravelTales while offering the marketing prices. By focus on the increasing needs for the tourism which is eco-friendly. The introduction to the packages mainly focuses on the sustainable practices such as programs of carbon offset and eco-lodges, to attract the sustainable conscious consumers.

Other opportunities for growth: The Amar might boost the offerings of Travel tales via focusing on the planning services of the corporate travel for the increasing segment and for the business consumers. Moreover, the Strategic collaboration with the airlines and luxury hotels might boost the profitability, developing the consumer value and exclusive deals.

Developing the business operations within the functional areas

Finances:

Diversifying revenue streams: Expanding the opportunities of the revenue via providing the additional services. This can include the concierge services and travel insurance.

Cash flow management: Negotiating on the effective terms and review the prices of overhead with the suppliers and landlords to decrease the expenses. Moreover, focusing on the implementation based on the model of subscription where the consumers pay for the high rates packages with the instalments.

Operations:

Scalability: Shift from the proprietorship sole to the limited organization of liability to boost the growth opportunities and limit the liability of personal.

Streamline administrative procedures: Effective utilisation of the solutions based on the cloud to automate the procedures of manual such as consumer data management and booking. The effective tools mainly free the time for the effective strategic activities and decrease the errors.

Marketing

Boost the social media presence: Hire the expert of the digital marketing to develop the targeted campaigns based on the effective platforms such as Tik Tok, LinkedIn and Instagram (Ibidunni et al, 2022). The utilisation of the content, this is visual appealing to highlight the experiences of the unique travel.

Content marketing: Start a YouTube channel or blog providing the destination and travel tips showcases to effective position the organization as the leader within industry.

Human resources

Performance management: Effectively introduce the incentives of the performance mainly tied to the sales targets and consumer satisfaction to the staff motivation (Nani and Safitri, 2021).

Develop hiring practices: Boost the hiring structured procedures to make sure that candidates can have the experience related to the industry and align with vision of TravelTales.

Ensuring the practices of ethical business:

By effective avoid the excursions operator collaboration can exploiting the employees. The reputable operators’ partnership can uphold the practices of the ethical labor and also making sure about the safe working and fair wages conditions. Ensure about the promotional and advertising campaigns which mainly can’t mislead and transparent the consumers related to the packages and pricing inclusions (Harsch and Festing, 2020). Boost the CSR initiatives such as programs of the tourism based community which can provide benefits to the different local communities within the TravelTales destinations offerings. Create the ethics code which is outlining the commitment of TravelTales to sustainability, transparency and fairness. The train workers are to stick and align with the values.

By effectively reducing the external risks and internal inefficiencies, these can attract the opportunities. The organization can position as competitive and resilient player within the travel industry. Furthermore, the practices of ethical business would not secure the reputation of the organization and also appeal the big consumer base.

CONCLUSION

Summing up the report it states that the in order to resolve the within the TravelTales, The Amar need to have the strategic approach which can boost the emerging opportunities, reduce the external risks and enhance the internal operations. By ATOL license, investing within the development of workers, adopting emerging technology plays a major role within the internal steps. These mainly rebuild the trust of consumers and boost the effectiveness. Externally, by effectively adapting the changes in the economy via digital marketing and diverse strategies of the pricing would offer help on attracting the consumer base. Development of collaboration with the ethical practices and also provides the options of the sustainable travel. The Amar might effectively position the organization as the effective and socially responsible organization. This can full fill the increasing needs for the sustainable tourism.

REFERENCES

Books and journals

• Asemokha, A., Musona, J., Torkkeli, L. and Saarenketo, S., 2019. Business model innovation and entrepreneurial orientation relationships in SMEs: Implications for international performance. Journal of International Entrepreneurship, 17, pp.425-453.
• Ciampi, F., Demi, S., Magrini, A., Marzi, G. and Papa, A., 2021. Exploring the impact of big data analytics capabilities on business model innovation: The mediating role of entrepreneurial orientation. Journal of Business Research, 123, pp.1-13.
• David, N. and Jane, B., 2019. Business in Context: An Introduction to Business an its Environment. Cengage Learning, Inc.
• Harsch, K. and Festing, M., 2020. Dynamic talent management capabilities and organizational agility—A qualitative exploration. Human Resource Management, 59(1), pp.43-61.
• Ibidunni, A.S., Ogundana, O.M. and Okonkwo, A., 2022. Entrepreneurial competencies and the performance of informal SMEs: The contingent role of business environment. In Entrepreneurship and the Informal Sector (pp. 28-50). Routledge.
• Johnson, J., Whittington, R., Regnér, P., Angwin, D., Johnson, G. and Scholes, K., 2020. Exploring strategy. Pearson UK.
• Nani, D.A. and Safitri, V.A.D., 2021. Exploring the relationship between formal management control systems, organisational performance and innovation: The role of leadership characteristics. Asian Journal of Business and Accounting, 14(1), pp.207-224.
• Nickels, W.G., McHugh, J.M. and McHugh, S.M., 2019. Understanding business. McGraw-Hill.
• Shahzad, M., Qu, Y., Zafar, A.U., Rehman, S.U. and Islam, T., 2020. Exploring the influence of knowledge management process on corporate sustainable performance through green innovation. Journal of knowledge management, 24(9), pp.2079-2106.