Strategy for Tourism
Part 1
Unit 1
Introduction and
Overview
Module Aims
 The aim of the module is to provide an
opportunity for students to understand, apply
and critically evaluate strategic analysis for
tourism organisations and destinations. The
examination and analysis of particular tourist
organisations and destinations will provide a
basis for understanding and critically
evaluating the factors that can contribute to
successful strategy. Students will be able to
evaluate strategies, their appropriateness and
the issues that will determine whether or not
they are successful.
Module Outcomes
Intended Learning Outcomes
 On successful completion of this module the
students will be able to:
understand the theory and practice of strategy in
tourism
develop appropriate strategies based on critical
situational analysis
provide an evaluation of the strategies pursued in
different tourist contexts
identify and evaluate the critical success factors
There are 12 units in this
module
 Part 1 Strategic Purpose
1. Introduction to strategy
2. Mission and purpose
3. Culture and strategy
 Part 2 Strategic Analysis
1. The external environment:
PEST
2. The external environment:
Competition
3. The internal environment:
Capability
 Part 3 Strategic Choice
7. Strategic options
8. Strategic direction and
methods
9. Strategic evaluation
 Part 4 Strategic
Implementation
10. Organising and resourcing
11. Managing and monitoring
12. Strategy in action
Reading
Book
Ch
Tribe, J, (2010) Strategy for Tourism, Goodfellow
Publishers, Oxford.
1
Capon, C. (2008) Understanding Strategic
Management, Prentice Hall: Hemel Hempstead.
1
Tribe, J. (2005) The Economics of Recreation, Leisure
and Tourism, Butterworth Heinemann, Oxford.
-
Johnson, G., Scholes, K., and Whittington, R. (2008)
Exploring Corporate Strategy, Prentice Hall: Hemel
Hempstead.
1
Part 1: Introduction
 Unit 1 provides an introduction to the subject and introduces a
framework for examining the whole strategy process based
around four key component parts of the strategic process:
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strategic purpose
strategic analysis
strategic choice
strategic implementation
 These four areas in turn provide the headings for the four parts
of this book.
 Unit 2 examines in detail the concept of strategic mission. It
analyses the aims and purposes of tourism entities and
introduces the idea of stakeholders.
 The relationship between culture and strategy is investigated in
Unit 3
Unit 1 Objectives
 After studying this unit and related materials you
should be able to understand:
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the meaning of strategy
the process of strategy
the importance of strategy
the contexts and uses of strategy in tourism
competing approaches to strategy
 and critically evaluate, explain and apply the above
concepts.
Case Study 1: The Tourism
Strategy for New Zealand
Case Study 1: The Tourism
Strategy for New Zealand
 The New Zealand Tourism Strategy 2015 is guided
by its vision statement:
 “In 2015, tourism is valued as the leading contributor to a
sustainable New Zealand economy”.
 But a vision needs unpacking into more specific
outcomes and for NZTS 2015 these are:
 “New Zealand delivers a world-class visitor experience
 New Zealand’s tourism sector is prosperous and attracts
ongoing investment
 The tourism sector takes a leading role in protecting and
enhancing the environment
 The tourism sector and communities work together for
mutual benefit”
Strategic Planning: The
Elements
There are four key elements of corporate
strategy:
 Strategic purpose
 Strategic analysis
 Strategic choice, and,
 Strategic implementation
Strategic Purpose
This is often defined by an organisation’s
mission which includes:
 what the organisation is trying to achieve
 what its purpose or aim is
 where it is trying to head for in the medium to long
term.
Mission is influenced by
 stakeholders
 culture
 nature of business
NZTS 2015
In the case of NZTS 2015 the mission (in this
case called vision) is that:
 “In 2015, tourism is valued as the leading
contributor to a sustainable New Zealand
economy” (p. 5)
Key contributors to NZTS 2015
 The Tourism Industry Association
 The Ministry of Tourism
 Tourism New Zealand
Strategic Analysis
This involves consideration of the major
influences upon the organisation's success in
terms of
 Resources (capability), and
 Operating environment
Strategic analysis is concerned with
analysing
 the strengths and weaknesses of an
organisation’s internal resources and
 the opportunities and threats posed by its external
operating environment.
NZTS 2015
NZTS 2015 identifies four significant threats
in its external environment.
 The impact of travel on climate change.
 The greater use of IT by consumers.
 The trend towards higher fuel prices.
 The the highly competitive nature of tourism
destinations
Strategic Choice
This is concerned with
 generation of strategic options
 evaluation of strategic options, and,
 selection of strategy
NZTS 2015
The strategic option favoured by NZTS has
moved from mass tourism (where price is a
major consideration) to quality / differentiated
tourism (where visitor and host experience is
a major consideration).
The “100% Pure New Zealand” brand (p. 10)
remains a central part of the strategy
 The following link shows the TV “100% Pure” for
New Zealand
http://www.youtube.com/watch?v=9sEZ-wdFegU
Strategic Implementation
This is concerned with:
 resource planning
 organisational structure
 logistics and implementation timetable
 timetable for implementation
 monitoring and review
NZTS 2015 Performance
Targets
 “Increasing visitor satisfaction
 TARGET: Increase by four percentage points the number of international
travellers who rate their overall experience of New Zealand as eight or
more on a 10–point scale…
 Increasing the amount visitors spend
 TARGET: Increase the average amount that visitors spend per night from
$130 to $160 by 2015.
 Reducing seasonality
 TARGET: Increase the number of international visitors who arrive in the
shoulder season … at a rate that is 25% faster than the overall annual
forecast growth rate every year between now and 2015…
 Delivering environmental best practice
 We must develop ways of measuring the amount of carbon emitted by the
tourism sector …
 We must develop ways of measuring how satisfied visitors are with New
Zealand’s environment performance.
 Creating positive community outcomes
 We must develop ways of measuring how local government
accommodates and promotes tourism and how residents feel about the
tourism activities taking place in their communities.”
What is strategy? Some
definitions: 1
"Strategy is the direction and scope of an
organisation over the long term: ideally,
which matches its resources to its changing
environment, and in particular its markets,
customers or clients so as to meet
stakeholder expectations." (Johnson and
Scholes, 2008)
What is strategy? Some
definitions: 2
" A strategy is the pattern or plan that
integrates an organisation's major goals,
policies and action sequences into a
cohesive whole." (Quinn, 1998)
"Five definitions of strategy are presented... as plan, ploy, pattern, position and
perspective." (Mintzberg, 1998)
What is strategy? Some
questions
A strategy needs to address the following
questions:
 where are we trying to go?
 how can we get there?
 how do we know if we've got there?
Working definition of strategy:
 "the planning of a desirable future and the design
and testing of suitable ways of bringing it about".
Characteristics of strategic
decisions
 They are:
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are complex rather than simple
are integrated rather than isolated
are long term rather than short term
are proactive rather than reactive
have an impact on the whole rather than a part of the
organisation
 involve major rather than minor change
 involve grand design rather than marginal tinkering
 are made by those in positions of power in the organisation
rather than subordinates
Scope of corporate strategy
for tourism
Tourism Profit-making organisations
NGOs
Government Organisations
NTOs
Destinations
Master Plans
Specific goals – e.g. climate change
Mega projects and Events
The importance of strategy
Avoid Strategic Drift
Survive Turbulent Environments
Avoid Organisational Fragmentation
Provide Co-ordination
Avoid Strategic Drift
change
K
environment
strategic drift
F
G
0
L
H
tourism
organisation
J
1
time
2
Survive Turbulent
Environments
Avoid
Organisational
Fragmentation
Co-ordination Strategy
 A national, regional or
local tourism strategy
often works to coordinate al the
disparate players in the
tourism economy
Strategy as a prescription vs
the contested approaches
 Strategy as prescription
 This grouping of approaches including the classical
approach believes that a strategy can be formulated using
knowledge about an entity’s situation and that the strategy
can be effectively put into action.
 The contested nature of strategies
 Other approaches underline the messiness of the world that
entities operate in, the difficulties of obtaining correct
knowledge, the sometimes overwhelming power of the
external environment on entities and the effects of humans
on the whole process.
Review of Key Terms
 Strategy: The planning of a desirable future and the design and
testing of suitable ways of bringing it about.
 Four key elements of tourism strategy: strategic purpose,
strategic analysis, strategic choice and strategic
implementation.
 Strategic drift: When an entity has failed to monitor and keep
pace with its changing external environment.
 Turbulent Environments: Dynamic, diverse, difficult and
dangerous.
 Fragmentation: When the constituent parts of an entity do not
serve a common goal.
 Competing Approaches to Strategy: Strategy as prescription vs
the contested nature of strategies.
Case Study: BAA
1. The following link is an
interview is with BAA
Chief Executive Officer
Stephen Nelson (2007)
http://www.baa.com/annualrevie
w07/ceo_message/
 What aspects of strategy
are illustrated in this
interview?
Review Questions 1
1. Define the term strategy in your own words. Use
examples, explain the essential features which
distinguish a strategy from similar concepts and
use counter-examples to clarify what strategy is
not.
2. Explain the relevance of the terms strategic drift,
turbulent environments and organisational
fragmentation to a named tourism entity.
3. Map out the four key elements of strategy for a
named tourism entity.
4. Explain, using examples, what Mintzberg (1998)
meant when he described strategy as "plan, ploy,
pattern, position and perspective". Do you think his
definition is an appropriate one?
5. What factors can make strategy a contested
concept?
Case Study: Ryanair
Review Questions 2
 Read the following strategy statement for
Ryanair (or find alternative)
http://www.ryanair.com/site/about/invest/doc
s/Strategy.pdf
and answer the following questions:
 What is a strategy?
 What are the key elements to a Ryanair’s
strategy?
 How is Ryanair’s strategy different to that of BA
and which is the most successful?
Ryanair
Below is a link to a presentation showing
strategic data for Ryanair
 http://www.ryanair.com/doc/investor/2009/Investor
%20Day%202%20Oct%202009.pdf
This is the presentation about Ryanair given
to investors in the company
Strategy for Tourism
Unit 1
Introduction and
Overview
The End