TUI GROUP Tourism Company Assignment Sample

TUI GROUP's business environment, COVID-19 impact, and recovery strategies for sustainable growth.

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Introduction Of The TUI GROUP Tourism Company Assignment

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The business environment has a significant impact on the performance of a business. The present research is based on the TUI GROUP which is a tourism company. It gives opportunities to the customers, shareholders as well as the employees. The annual case study report of the present company will help here to discuss the business environment within the UK as well as globally. It will present the importance of the business environment in the performance as well as the relationship with the stakeholders as well as the strategic direction. Internal business environment, micro, as well as macro environment is important for business and it determines the performance of the business.

An internal business environment refers to the factors that are directly related to the company's activity. Therefore it is called that these factors have a direct impact on the daily activities of the company. The important factors included the suppliers, employees, customers, shareholders, competitors, as well as financial institutions. The microenvironment refers to the kind of environment within the business that is directly connected to the company and it also affects the daily activities of the business. On the other hand, the macro environment refers to the condition that lies within the economy as a whole part rather than a specific sector.

Section 1

Business overview

TUI Group is considered to be one of the most important leading groups in tourism. This is a huge institution that is consisted of strong tour operators. This company consisted of various major destinations around the world (tuigroup.com, 2022). The specification of this group is that it covers the total value champion under the same roof. The most important factor related to this company is that it is globally connected with the responsibilities of environmental, economic, as well as social sustainability.

Size

The most important factor is that the reflection has been seen in the commitment to sustainable tourism for 20 years. It has consisted of 1,600 travel agencies as well as leading online portals. There are also five airlines with around 150 aircraft, 16 cruise liners, different incoming agencies, and more than 400 hotels (Lieberwirth and Hobbie, 2022, p.125). The group offers integrated offerings ad this matter helps to give them 27 million customers over 180 regions. The share of this group is listed on the “FTSE 250 Index” and it6 also regulated in the market of the “Hanover Stock Exchange”

Sector and industry of operation

The industry refers to a specific group of companies or businesses whereas the sector is nothing but a large segment of the economy. There are various strong operators having a leading position in the domestic market that are mainly clustered under the roof of the TUI Group (Möller et al. 2020, p.124). It is connected to various countries such as “Germany, Austria, Poland, Switzerland, Denmark, Finland, Norway, Sweden, France, Belgium and the Netherlands”. This group shows the leading tours as well as activities that are combined with the digital platform and have local services in more than 140 countries. It is an available group for all kinds of holidays as well as city destinations all over the world (Nudurupati et al. 2021, p.451). It includes TUI customers and the annual number is 28 million.

Direct or indirect competitive organisation

TUI Group is one of the leading tourist organisations that run a successful business in several countries. After a lot of struggling periods, the organisation is able to consume one of the leading positions in the global tourism sector.

Figure 1: Competitors of TUI Group

(Source: Song et al. 2018, p.1000)

According to recent research, it is disclosed that Jet2 Holidays is the tough competitor of this organisation in the current situation which consume more than 28% of the total market. Other leading organisations in this sector are Lindblad Expeditions, Cox & Kings and Travcoa which consume more than 50% of the market of this sector in terms of global aspects. TUI groups also consume around 19% of this market and it is gradually improving its situation.

Structure of the organisation with leadership team

Table 1: Organizational Structure of TUI Group

(Source: Song et al. 2018, p.1000)

The head of this organisation is the “Chief Executive Officer” who controls all the business decision as well as implements new strategies. The business managers, production and operational managers, executive board along with CFO are working under the guidance of the personality (Rimita et al. 2020, p.2). The “Chief Strategy Officer” the HR managers and all the members of “IT and Future Market” are fully controlled by the “Chief Executive Officer”.

Section 2

Consequences of the COVID-19 pandemic on the business of the internal environment of TUI Group

COVID-19 pandemic is a curse to the entire business sector that has a great impact on every business as strict regulation has been regulated within the country boundary.

Figure 3: Impact of COVID-19 on the internal business of TUI Group

(Source: statista.com, 2022)

The inner business performances of the organisation were greatly affected during the pandemic situation which is clearly seen in the above-mentioned figure. Recent research disclosed that the inner business performance of this organisation in the northern region was 5643 thousand, in the central region 7151 and in 7389 in the western region in 2017 while the total business was more than 20000 thousand.

In 2018, the organisation increased its business revenue by 1.56% which is around 22000 thousand. On the other hand, during the pandemic situation, a great disaster is seen in terms of the business revenue collection and the business revenue collection decreased by more than 50% as it earned only 8056 thousand in 2020. This situation arises because the business activities of this organisation were almost stopped because of the strict regulation regulated by the country's government (Song et al. 2018, p.1000). In 2021, the business situation decreases profoundly. In that year the business revenue collection was 5360 thousand which is very nominal for this organisation.

Effect of recovery plan of UK governments on the internal environment of TUI Group

Figure 4: Effect of recovery plan of UK governments on TUI Group

(Source: Bianchi and de Man, 2021, p.360)

The government of the UK has regulated several regulations to deal with the pandemic situation that will be very helpful in the for the entire business organisation including the TUI Group. This recovery plan of the government include is to provide great support to all the business organisations within the country boundary in terms of financial, operational as well as marketing performances.

According to recent research, it is disclosed that after the implementation of the recovery plan of the UK government TUI Group was able to develop the business situation from the previous situation. It is seen that the annual revenue collection of this organisation was improved from 336 bn US$ to 544 bn US$ an increase of more than 62% (Bianchi and de Man, 2021, p.360). Apart from that, net business development increased from 128 bn US$ to 146 bn US$ which increases around 14% which was very effective for any organisation under the guidance of the UK government.

Section 3

Consequences of the COVID-19 pandemic on the business of the microenvironment of TUI Group

The microeconomics of TUI Group depends on several factors like customers, competitors, suppliers as well as marketing intermediates. All these factors are very significant for business development that guide to improving the business revenue collection as well as improve the business sustainability. The basic integrity of this company is the political stability that guides it to improve the operational process as well as improve the brand identity of the company. Economic stability is one of the core components of the organisation that guides the improvement of the financial operational process of the organisation and it is mostly dependent on the circumstances (Barkhatov et al. 2020, p.13013). During the pandemic situation, the economic stability was uncertain which greatly hampers business performance.

Economic development is one of the most important aspects of the business organisation considered the pillar of microeconomics greatly affected by the pandemic situation caused by the sudden outbreak of corona virus. Another important aspect that is affected during the pandemic situation is the inflation rate which was uncertain during that time (Rimita et al. 2020, p.2). Because of the uncertain situation, the exchange rate become very high and the socio-cultural environment was also greatly affected which leads to cause a reduction in annual business revenue collection.

Effect of recovery plan of UK governments on the microenvironment of TUI Group

The government of the UK has created a recovery plan for the business organisation that guides to impave business performance during the pandemic situation which guides to improve the performance and revenue collection system of the organisation. Apart from that, this recovery plan has a great impact on microeconomics (Barkhatov et al. 2020, p.13013). The principal components of microeconomics of this organisation are the demand or supply in personal markets is improved by the recovery plan of the UK government. Apart from that, after the implementation of the recovery plans into the business plans it guides to improve the “individual consumer behaviour”, “individual producer behaviour” as well as “individual labour markets”.

Another important aspect of the microeconomics of an organisation during the pandemic situation guides to improve economic growth. This company along with other tourists company are very much affected by the strict regulations as these companies are mostly dependent on the customers (Abu-Rumman, 2021, p.178). Apart from that, tourist spots all over the world were almost stopped during the pandemic situation to maintain the COVID-19 guidelines regulated by WHO.

Section 4

STEEPLE factors analysis of TUI Group

Basic factors Informations Impact
Social
  • Recent trend perspective- 42%
  • Cultural integration- Innovative
Positive
Technological
  • Technological development - Satisfactory
  • Available information - Sufficient
Positive
Economic
  • “Political stability”- about 1.85%
  • The rate of unemployment - 4.1%
  • Rate of job providing - about 800 per year
Positive
Environmental
  • Climate change crisis - 1.2%
  • Pollution caused by tourists - 12.4%
Moderate
Political
  • Political involvement - 21.6%
  • Political integtation - 12.3%
Moderate
Legal
  • Easy in access- 68%
  • Loans of tourists- 34%
Positive
Ethical
  • Value of the organizational - Good
  • Organizational missionary perspectives - Satisfactory
Positive

Table 1: Analysis of STEEPLE factors of TUI Group

(Source: Hamilton and Webster, 2018, p.230)

The leading business organisation in the tourist industry, TUI Group has done a considerable business all over the world. In order to analysis of the STEEPLE of the organisation, there ate serval contexts emerged that showed the business organisation performing its business activity successfully with integrity (So?oducho-Pelc and Sulich, 2020, p.8832). The “recent trend perspective” of this organisation is 42% and the cultural inquisitiveness is innovative which is very effective for the success of the organisation. The technical improvement and the available information of this organisation are satisfactory.

The stability in political aspects is about 1.85% and the unemployment rate is 4.1% which is fair enough for the organisation. It provides more than 800 candidates every year which is good. The “climate change crisis” is 1.2% and the “tourist-caused pollution” rate is 12.4% which is moderate and the organisation can focus on these aspects (Worthington et al. 2018, p.1000). “Political involvement index” is 216% and the political integrity of this organisation is 12.3% which is also moderate that also needs improvement.

Conclusions

Suggestions

Taking into consideration the above study it can be suggested that the organisation can strengthen the internal performance that also affects micro or macroeconomics. Effective business communication can be helpful to improve the business situation. In the current situation, the organisation has faced several business issues in terms of business performance and all the issues that emerged during the pandemic situation. The business performances of the business organisation were greatly hampered during and after the pandemic situation due to strict regulation of the government almost stopping the transportation facility.

Recommendations

Coming to the end of this discussion it can be recommended that the organisation can appoint a research and development team which is responsible to evaluate the recovery plan to successfully implement the “UK government tourism recovery plan”. Apart from that, it is also recommended that the organisation can monitor the plan regularly guides to improve the business plans for better business performance (Vlados and Chatzinikolaou, 2019, p.25). The recovery plan also guides the economic stability of the organisation that guides to the business position. Apart from that, it s very helpful for the organisation to survive in the uncertain situation faced the organisation during the pandemic time.

References

Journals

Abu-Rumman, A., 2021. Transformational leadership and human capital within the disruptive business environment of academia. World Journal on Educational Technology: Current Issues, 13(2), pp.178-187.

Barkhatov, V., Benz, D. and Pletnev, D., 2020. Trust in the Russian economy and business environment. In E3S Web of Conferences (Vol. 210, p. 13013). EDP Sciences.

Bianchi, R.V. and de Man, F., 2021. Tourism, inclusive growth and decent work: A political economy critique. Journal of Sustainable Tourism, 29(2-3), pp.353-371.

Hamilton, L. and Webster, P. (2018).The international business environment. 4th ed. Oxford: Oxford University Press.

Lieberwirth, M. and Hobbie, H., 2022. Decarbonizing the Industry Sector and its Effect on Electricity Transmission Grid Operation-Implications from a Model Based Analysis for Germany.

Möller, K., Nenonen, S. and Storbacka, K., 2020. Networks, ecosystems, fields, market systems? Making sense of the business environment. Industrial Marketing Management, 90, pp.380-399.

Montezuma, J. and McGarrigle, J., 2019. What motivates international homebuyers? Investor to lifestyle ‘migrants’ in a tourist city. Tourism Geographies, 21(2), pp.214-234.

Nudurupati, S.S., Garengo, P. and Bititci, U.S., 2021. Impact of the changing business environment on performance measurement and management practices. International Journal of Production Economics, 232, p.107942.

Rimita, K., Hoon, S.N. and Levasseur, R., 2020. Leader readiness in a volatile, uncertain, complex, and ambiguous business environment. Journal of Social Change, 12(1), p.2.

So?oducho-Pelc, L. and Sulich, A., 2020. Between sustainable and temporary competitive advantages in the unstable business environment. Sustainability, 12(21), p.8832.

Song, H., Li, G. and Cao, Z., 2018. Tourism and Economic Globalization: an emerging research agenda. Journal of Travel Research, 57(8), pp.999-1011.

Vlados, C. and Chatzinikolaou, D., 2019. Methodological redirections for an evolutionary approach of the external business environment. J. Mgmt. & Sustainability, 9, p.25.

Worthington, I. and Britton, C. and Thompson, E. (2018) The business environment: a global perspective. 8th ed. Harlow: Pearson

Websites

statista.com, (2022), Annual revenue of TUI Group, Available at: https://www.statista.com/statistics/1225578/tui-ltd-revenue-uk/[Accessed on: 26th October, 2022]

tuigroup.com, (2022), About the company, Available at: https://www.tuigroup.com/en-en/about-us/about-tui-group [Accessed on: 26th October, 2022]

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