Developing Leader for Change & Innovation in Tourism
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Transcript of Developing Leader for Change & Innovation in Tourism
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Developing Leader for Change & Innovation in Tourism
28th June 2010
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Future Industry Trends, Creative Thinking and Innovation
Tom Baum PhD
University of Strathclyde, Glasgow
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INTRODUCTIONS……
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Youse (as we say in Glasgow) are …….
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……. and me
30 years in tourism as practitioner, academic, researcher and teacher
Currently Professor in the Strathclyde Business School, top-rated in Scotland and top 10 in the UK
On-site experience in over 30 countries Special research and development interest in
HR/ work in tourism and in……..
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Greatly influenced by….
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Tourism and small island communities
Particular dynamics of tourism in an island context
The appeal of islands Issues of access and supply psychological,
economic, logistical Competitive barriers Cultural distinctiveness Jurisdictional independence
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10
Key Concepts and Learning in this Module
Understanding future trends and developments in international tourism
Harnessing strategic planning tools as a means of maximising the benefits of this understanding
Planning and implementing creative/ innovative strategies and solutions in order to enhance business competitiveness
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11
Programme Overview
SESSION 1Tourism – a future scan: utilizing the tools
SESSION 2Finding and applying creative/ innovative solutions
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Thinking about the future….. And learning from the past
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The Future
The future is inherently unpredictable– The purpose of planning is not to
predict the future but to increase the possibility space for the organisation
The future is co-created– We are neither passive victims of forces
beyond our control nor masters of our destiny
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Wind the clock back 10, even 20, years …..What we DID NOT know
List a few ideas/ things/ ways of doing things that have entered our lives over the last 10 years….
IF you are old enough, do the same for 20 years ago…….
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Maybe…..
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Economy
Conflictand
terror
Customersand
competition
The unexpected
New frontiers
Technology
Resources
Climateand
environment
Tourism:
The future
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ANNUAL REPORT
TEN IMPORTANT WORLD TOURISM ISSUES
2011
David L. Edgell Sr., PhD
Professor of Tourism, East Carolina University
Ex-US Department of Commerce responsible for Travel and Tourism
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1. Repercussions from the global economic slowdown on tourism
2. Continuous concern for safety and security with respect to tourism
3. Significance of sustainability in the development and management of tourism
4. Effect on tourism from natural and manmade disasters
5. Growth in the use of electronic and other technologies in tourism
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6. Impact on tourism with the introduction of new destinations
7. Importance of fuel costs on tourism
8. Influence of mega events on tourism
9. Using strategic tourism policy and planning tools for communities and nations
10.Recognition of increased tourism activity in the East Asia and Pacific Region
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Interpreting these in the Maltese context?
Your main themes: Access routes and options, all year round Fuel price impacting on access Market dependence on UK – need to develop
new markets (Far East) Develop internal, domestic markets Need to develop higher spend niches
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Creation of a year round destination – address seasonality
Need to upgrade product and focus on quality
Dealing with change and new challenges Maximizing Impact Monitoring performance Managing Information Utilise social networks to best effect
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Climate change impacts – source markets and at home
Rising sea levels Worldwide recession and lower spending
visitors Understanding the tourists of 2015 and 2020
– Gen Y New competing markets – Libya Increasingly demanding customers
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Development of ecotourism options – issue of awareness?
Future of traditional distribution models – travel agents/ tour operators – who will we be dealing with?
Growth in demand for marine tourism
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What is required is a strategic approach to the identification and analysis of future trends……
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The organisation The business ecosystem
The future
Increasing awareness
Scenarios(Imagining the future)
Strategic options(Exploring our future possibilities)
Co-evolution(Discovering our place & relationships)
The Goal:To increase awareness about the organisation, its environment and the future.
The Goal:To increase awareness about the organisation, its environment and the future.
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Malta’s tourism Culture
– What are the patterns of thinking & behaviour which characterise tourism in Malta?
– Is change needed?
Competencies– What is tourism in Malta distinctively good at?– Do these give competitive advantage?– What needs to be developed?
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Your organisation or area of responsibility Culture
– What are the patterns of thinking & behaviour which characterise your organisation or area of responsibility?
– Is change needed?
Competencies– What is your organisation or area of responsibility
distinctively good at?– Do these give competitive advantage?– What needs to be developed?
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The environmentThe environmentThe environmentThe environment
International lawInternational lawInternational lawInternational law
GovernmentGovernmentssGovernmentGovernmentss
Standards bodiesStandards bodiesStandards bodiesStandards bodies
StakeholdersStakeholdersStakeholdersStakeholders
Supplier’s Supplier’s supplierssuppliersSupplier’s Supplier’s supplierssuppliers
Customer’s Customer’s customerscustomers
Customer’s Customer’s customerscustomers
New entrantsNew entrantsNew entrantsNew entrants
CustomersCustomersCustomersCustomersSuppliersSuppliersSuppliersSuppliers
CompetitorsCompetitorsCompetitorsCompetitors
SubstitutesSubstitutesSubstitutesSubstitutes
Malta/ Malta/ OrganisationOrganisation
Malta/ Malta/ OrganisationOrganisation
An Ecosystem for Malta or your organisation
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Mapping the ecosystem PEST (Political, Economic, Socio-cultural. Technological)
plus E - Environmental
Customers Markets Competitors – who are your main
competitors? Business or Destination analysis?
Competition or coopetition? Porter’s Five Forces
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Strategic options“Our future possibilities”
Key strategic issues– What are the real areas which affect our business?– (E.g. service, channel, market)
Formulate key decision areas– Where do decisions need to be made?
Create clusters of options– Discover coherent strategies– Check against distinctive competencies
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Scenario PLANNING“Imagining the future”
Identify key driving forces Choose most uncertain/most
significant Develop alternatives ‘Flesh out’ with narrative
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Planning is not about…
Planning is not about predicting the future Planning is not about writing a detailed
road map into the future Planning is not about a few people writing
a vision statement & then getting ‘buy-in’ from everyone else
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EU Project
Comprehensive sectoral analysis of
emerging competencies and economic
activities in the European Union
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Potential of drivers of change New lifestyles and consumer trends (eg. concerns
about health, climate, environment, convenience etc.)
Food prices Economic development and globalisation ICT and digitalisation Strengthened legislation on food safety Food technologies: Preparation, cooling and storing The ageing population Climate changes
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Classification of drivers
CERTAIN UNCERTAIN
IMPORTANT
LESS IMPORTANT
• Economic development and globalisation
• New lifestyles and consumer trends (eg. concerns about health and environment, convenience etc.)
• Food prices• Strengthened legislation on food safety
• Food technologies: Preparation, cooling and storing
• The ageing population
• ICT and digitalisation
• Climate changes (actual climate changes will not influence the sector much until 2020. In the long run climate changes might result in dramatic changes in the sector)
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Main drivers of change Main/most important drivers of change
– The ageing population of Europe
– New lifestyles and consumer demands
– Increased use of ICT and the Internet
– General economic development and Internationalisation
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Driver: an ageing population
Consumers will be older in the future and older tourists require more specialised services, among others due to disabilities.
An ageing population means an ageing workforce. This is important in the sector, since its workforce today consists mostly of young workers.
When it comes to catering and canteens the ageing population will mean a potential growth in their integrated services, which increasingly include elderly care.
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Driver: new lifestyles Customers are becoming more and more
enlightened and demanding when it comes to health, climate, environment and politics
For restaurants, cafés and bars healthy menus and traceability of foodstuff – as an example - becomes more important and require staff to be knowledgeable in that aspect
For hotels it means giving its customers a full-time experience including for example spas and professional health-guiding
Within catering, snacking increases while simultaneously diminishing the demand for
traditional ‘heavy’ lunches
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Driver: Increased use of ICT
For the customers it means greater possibilities in finding Hotels and restaurants and catering establishments online, and the ability to be pickier.
For the companies it means greater possibilities to market themselves and to receive customers from areas far beyond the neighbourhood.
In the coming years, supply chains and administration will increasingly be handled online.
The increased use of ICT and the internet has had, and still has, a great impact on the
Hotels and restaurants sector.
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Driver: general economic development
Economic development
When people have more money they tend to spend more on travelling and dining out. Also, their demands for quality and uniqueness rise.
An economic recession, on the other hand, will result in decreased demand and a higher focus on price and value for money.
Internationalisation
Internationalisation means increased opportunities for attracting new customers from outside Europe but also growing competition.
Internationalisation means a growing dominance of big cooperations and international brands and chains in the sector.
The general economic situation is of utmost importance for the Hotels and restaurants sector, which is often highly dependent on the tourism
economy.
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SWOT analysisStrengths
Non-substitutable: People will never stop travel or eat. An open sector: The sector creates job opportunities for young people and for women. Also, people with limited education can get the opportunity to a career. It is a global industry with highly international markets Due to its labour intensive and customer close nature it cannot be exported or outsourced It is a flexible industry which relatively easy handles changes.
Opportunities
The ageing population could be a boost for the catering sub-sector. Changes in the gender structures, more women entering the labour market means less time to cook at home. The trend of higher demands on quality could add value to the sector. Concerns for climate and health are also trends potentially adding value to products and services. Increased globalisation leading to more international travellers and tourists especially from emerging economies. Being increasingly on the move we need more snacking and take away
Weaknesses
High dependency on tourists, which are highly sensitive to political events. High seasonal dependency for most parts of the sector. Tend to be reactive instead of proactive Low productivity: Low profit margins and low added value Low levels of skills and educations among employees Reluctance to invest in its employees e.g. training, education, working conditions etc Perceived to be a low status employment sector Low barrier sector- many star ups and failures pressing profit margins (50-60% of all start ups ends as failures after 3 years)
Threats
The black market is a threat to working conditions, and to the sector’s competitiveness when it comes to recruiting skilled staff. The lack of sufficiently skilled personnel jeopardises the quality of the sector. With the climate threat, long distance travelling might decrease. An ageing population makes it even harder to recruit labour The educational system is ageing and might risk the quality of the sector.There is a trend to invest less in food for employees. Terrorism and political unrest
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Questions for discussions General comments: Do you agree on the drivers
identified as being the main drivers of change?
What is the major threat as well as the major opportunity for the main sub-sectors of tourism in Malta (hotels, travel services, attractions) in the coming years?
What is the major threat as well as the major opportunity for YOUR BUSINESS in the coming years?
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Crossing drivers of change
Puritanism
Consumers will develop a more
puritan and spiritual approach to
consumption. The personal
responsibility concerning for
example health, environment, climate and fair trade is taken very serious. Saving
before spending becomes more
important.
Economic recession and nationalism
A recession will influence the society for the next 10-12 years. It will result in
increased nationalism and regionalism where regions and nations turn their
back to global cooperation concentrating on their own lack of resources.
Economic growth and globalisation
The ongoing economic crisis is just a minor and short economic slow down.
With such a positive economic development increased globalisation
will follow.Escapism
Consumption is typically driven by the ‘faster, better, bigger’
ideology. Climate problems for example
are not seen as a personal responsibility
´. The escapists are concerned about health and the
fairness of the world but tend to escape via
wellness and traditional luxury.
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The four scenarios
Economic recession and nationalism
Continued economic growth and globalisation
Scenario 1
The Marco Polo
Scenario
Scenario 2
The Sunny Beach
Scenario
Puritanism
Scenario 3
The Body Shop
Scenario
Scenario 4
The Asceticism Scenario
Escapism
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Characteristics of the four
Economic recession and nationalism
Continued economic growth and globalisation
Escapism Puritanism
The Marco Polo Scenario
• High individualisation • Some specialisation possibilities • Polarisation of the market• High growth in inbound tourism• Wellness and traditional luxury
The Body Shop Scenario
• High individualisation• Many specialisation possibilities • Segmentation of the market• Healthy lifestyle and holidays• Goodness: volunteering, fair trade, organic food, etc.
The Sunny Beach Scenario
• Mass produce, economies of scale • Highly price driven market • Conformity• Comfort – but no luxury• Regionalisation of travelling
The Ascetism Scenario
• Basic living – simple holidaying• ‘Close-to-home’ tourism• Experiences: healthy, sustainable and cheap• Food: vegetarian, organic, local produce, simple
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The Marco Polo Scenario
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The Body Shop Scenario
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The Sunny Beach Scenario
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The Ascetism Scenario
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The Marco Polo Scenario The Body Shop ScenarioThe Sunny Beach Scenario The Ascetism Scenario
Malta’s future?
What needs to be done?
How would you and your business cope with each of these?
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Strategic tools to enable us to more effective analyse and respond to external change in hospitality and tourism – here we’ve used
A. PEST
B. SWOT
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What is PEST Analysis?
This analysis is essential for an organization before beginning its marketing process
Consists of internal environment and external environment
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SUMMARY
Political/ Legal Economic Socio-cultural
Technological
Environmental regulations and
protection
Economic growth Income distribution Government research spending
Tax policies Interest rates & monetary policies
Demographics, Population growth
rates, Age distribution
Industry focus on technological effort
International trade regulations and
restrictions
Government spending
Labor / social mobility
New inventions and development
Contract enforcement lawConsumer protection
Unemployment policy Lifestyle changes Rate of technology transfer
Employment laws Taxation Work/career and leisure attitudes
Entrepreneurial spirit
Life cycle and speed of
technological obsolescence
Government organization / attitude
Exchange rates Education Energy use and costs
Competition regulation Inflation rates Fashion, hypes (Changes in) Information Technology
Political Stability Stage of the business cycle
Health consciousness & welfare, feelings on
safety
(Changes in) Internet
Safety regulations Consumer confidence Living conditions (Changes in) Mobile Technology
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Role of PEST
Helps assess the market including competitors from the stand point of a particular business or from a destination perspective.
PEST is relevant for any type of business or
destination whether large, small & medium.
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S.W.O.T. Analysis
Strengths
Opportunities
Weakness
Threats
Factors Internal to Organization
Factors External to Organization
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SWOT
A SWOT analysis generates information that is helpful in matching an organization or group’s goals, programs, and capacities to the social environment in which it operates.
Factors internal to the firm usually can be classified as strengths (S) or weaknesses (W), and those external to the firm can be classified as opportunities (O) or threats (T).
It is an instrument within strategic planning. When combined with dialogue it is a participatory
process
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Simple Rules for SWOT Analysis
Be realistic about the strengths and weaknesses of your organization or group.
Distinguish between where your organization is today, and where it could be in the future
Be specific: Avoid gray areas. Always analyze in relation to your core mission. Keep your SWOT short and simple. Avoid
complexity and over analysis Empower SWOT with a logical conceptual
framework.
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Future of Travel – Dr Patrick Dixon
http://www.youtube.com/watch?v=L1C1chw1I4U
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Applying Dixon to Malta
To the destination?
To your business?
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Thank You!
Discussion
.