Strategy for Tourism Unit 11 Managing and Monitoring

Strategy for Tourism

Unit 11 Managing

and Monitoring

Reading

Book Ch

Tribe, J, (2010) Strategy for Tourism, Goodfellow Publishers, Oxford.

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Capon, C. (2008) Understanding Strategic Management, Prentice Hall: Hemel Hempstead.

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Tribe, J. (2005) The Economics of Recreation, Leisure and Tourism, Butterworth Heinemann, Oxford.

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Johnson, G., Scholes, K., and Whittington, R. (2008) Exploring Corporate Strategy, Prentice Hall: Hemel Hempstead.

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Learning Outcomes

After studying this chapter and related materials you should be able to understand:management of changemethods of monitoringmethods of controlidentification of key factors for effective

strategic management

and critically evaluate, explain and apply the above concepts.

Case Study 11: Australia’s framework for action on tourism and climate change The Australian Government identified tourism

as a key sector that is vulnerable to climate change concluding that:"the impact of climate change on infrastructure and

the natural environment has the potential to affect the tourism industry. In some cases this could result in social and economic impacts in regions with a high dependency on tourism as a source of income and employment." (Department of Resources Energy and Tourism, 2008, p .2)

In response the Tourism Ministers established the Tourism and Climate Change Taskforce to develop a Framework for Action.

Management of Change A key challenge for

many tourism organisations is that their structures were generally designed to solve yesterday's problems.

Challenges to management of change includeDegree of changeOrganisational

adaptivity

Management of Change

To compound this problem organisations may become "frozen" in a particular state (Lewin, 1952), not least because once a particular organisational structure and culture has evolved there is a strong tendency for structural and cultural reproduction. An organisation will tend to recruit, induct and reward its staff in line with its established culture, and the organisation will stay the same.

Unfreezing and Refreezing Lewin's model for creating successful

organisational change identified three important stages. First the unfreezing of current organisational

behaviour patterns is necessary in order to make the organisation more receptive change.

Second, Lewin identified the importance of movement, which involves the carrying out of change or the reconceptualisation of the organisation.

Finally, Lewin noted the importance of refreezing the organisation so as to institutionalise the change.

The Four Cs of ChangeThe management of strategic change

must pay attention to:calculationcommunicationculture and,compliance

Calculation

Calculation involves the identification of the likely impacts of a strategy both internally and externally to the organisation with a view to discovering where critical blockages may occur. These may inhibit the implementation of

change and are known as resisting forces. At the same time it is important to record

those factors (driving forces) which may help promote the desired strategy.

Force Field Analysis

Force field analysis (Lewin, 1935) is a method of examining this. Its aim is to enhance the management of change by generating a tactical approach (Nutt, 1989).

The steps in force field analysis are:Identification of planned changeIdentification of resisting forcesIdentification of driving forcesFormulation of tactics to reduce or eliminate

resisting forcesFormulation of tactics to encourage driving

forces

Communication

Effective communication is at the heart of successful strategic implementation.

Even organisations which engage in a systematic process of strategic planning may overlook this vital aspect so that the strategy may remain the property of senior management and its circulation may be intentionally or unintentionally restricted.

Different models of communication of strategy may be located on a continuum which includes:democraticeducative, andautocratic

Culture

Some of the key factors in promoting cultural change can be summarised:induction programmes for new staffchange of symbolsuse of languagetraining programmesappointment of key personnelpromotion and dismissal policiesincentive schemes

Compliance

Compliance addresses the question of how strategic change can be achieved, perhaps in the face of opposition. Change may involve deploying political processes, identifying and utilising sources of power (Mintzberg, 1983), and constructing a power base from which to operate. Key issues for achieving compliance include:control of resourcesalliancesrewards and punishmentscharisma, and,managing of change skills

Skills and methods for managing change

Beer & Nohria (2000) distinguish between two distinct approaches to strategic change. They label these “theory E” and “theory O”.Theory E, the hard approach, is change

based on the pursuit of economic valueTheory O, a soft approach, is change based

on the development of organisational capability.

Theory E and Theory O

Dimensions of change

Theory E Theory O

Goals Economic value Organisational Capability

Leadership Top down, hierarchical

Bottom up and participative

Focus Systems and structures

Culture, behaviour and attitudes

Process Planning and implementation

Experimentation and evolution

Reward systems

Financial Intrinsic and Financial

Use of consultants

Lead change processes

Support and advise

Skills for Managing Change Buchanan and Boddy's (1992) study of the

perceived effectiveness of managers of change included the following as crucial competences:Sensitivity to internal and external environmentClear expression of goalsTeam building skillsNetworking skillsAbility to cope with uncertainty surrounding changeCommunication skillsInspirational skillsNegotiation skillsPolitical skillsStrategic perspective

Activity: Climate Change and Aviation Air travel is a uniquely greenhouse-gas-intensive mode of

transport. Over a single journey of 1,500km, aircraft emit roughly twice as much greenhouse gas per passenger kilometre as cars or high speed rail. Shorter journeys produce even higher emissions per passenger kilometre. Over a distance of 500km aircraft emit six times more greenhouse gas than high speed rail or cars, and 12 times more than a coach.

The cross-party House of Commons Environmental Audit Committee (EAC) reports that under Department for Transport’s (DfT’s) ‘best case’ scenario, aviation will grow from around 5% of the UK’s carbon emissions today to 24% in 2050, a figure the committee considers a “substantial understatement”

The Tyndall Centre has estimated that with unconstrained growth, and taking account of its full environmental impact, aviation could account for more than 100% of the UK’s carbon budget (65 MtC) by 2050.

(Source Conservative Party Consultation Document, March 2007) Your task: The radical reduction of C02 emissions from UK air

transport. Provide advice ona. strategic objectives to achieve this aimb. how to manage and monitor change to achieve you aims

Control Mechanisms

Control mechanisms to monitor outcomes includePerformance targetsControl systemsMeasurement of performanceCorrective feedback

Corrective feedback

The system of management control should follow up the cycle of performance measurement with any corrective measures that are to be taken in the case that actual performance does not match up to the performance targets of the strategy. This will involve the following steps:Identify performance gapsIdentify causes of performance gapsIdentify corrective actionInstigate corrective action plan

Obstacles to effective strategy implementation Hrebiniak identified six top obstacles to

strategy implementation that resulted from two surveys of 443 managers. These were were:An inability to manage change Poor or vague strategyNot having guidelines or a model to guide

implementation effortsPoor or inadequate information sharingUnclear responsibility and accountabilityWorking against the organizational power structure.

Effective Implementation Critical Success Factors Pettigrew and Whipp's (1992) study of the

management of change concluded that there were five critical success factors common in organisations where change had been successfully implemented. These were:sensitivity to the external environment.formulation of a strategy for change.translation of strategic plans to operational

outcomes.effective human resource management. consistency and coherence of strategic planning.

Effective Implementation The 7-s Framework Waterman et al. (1980) claimed that effective

organisational change resulted from a successful relationship between several factors:structurestrategysystemsstyleskillsstaff, and,superordinate goals

Review of Key Terms

Management of change: The process by which strategic change is identified and implemented.

A frozen organisation: One which has become rigidly routinised. Four Cs of change: Calculation, communication, culture and

compliance.. Force field analysis: Investigates forces that are either driving

movement toward an objective (driving forces) or blocking such movement (resisting forces).

Theory E: Strategic change based on the pursuit of economic value. Theory O: Strategic change based on the development of

organisational capability. Performance Target: An outcome that is set for an organization or

employee to reach within a specified period of time. Control system: The process for monitoring progress against

strategic objectives. Performance measures: These include quality indicators, financial

indicators and other indicators. Corrective feedback: Identify performance gaps, identify the causes

of performance gaps, identify corrective action, instigate corrective action plan.

Strategic implementation: Putting a strategy into action

Discussion Questions

1. Many airlines are resorting to strategic alliances or horizontal mergers in moves towards more globalization. Choose an airline and conduct a force field analysis for such a strategy.

2. Explain how success could be encouraged in implementing a tourism destination strategy using Pettigrew and Whipp's (1992) five critical success factors and Hrebiniak’s (2006) discussion of obstacles.

3. Using examples from the tourism sector discuss the importance of control systems in strategy implementation.

4. Discuss the significance of the 4 Cs in the management of change in a tourism organisation.

5. Explain what Lewin (1952) meant by the freezing and unfreezing process in achieving strategic change

Strategy for Tourism

Unit 11 Managing

and Monitoring The End