Dubai as the Worlds Most Attractive Tourist Destination - Essay Example

?Dubai: Corporate Strategy Introduction Dubai has everything to become the world’s most attractive tourist destination. Politically, the leadership of Dubai has not left any stone unturned to change the entire shape and map of Dubai. Even its birth history is less than 45 years, yet it has surpassed many nations by developing its local infrastructure and making it one of the most attractive and tourist friendly countries in the world. From artificial attractions to the endowed attractions, from the most up-to-date transport system and to luxurious accommodations are such features that are really going to change the entire shape of tourism industry in the city of Dubai. Al Boom tourist village, nightlife of Dubai, Wild Wadi Park, a water adventure theme park, events and festival, including the Dubai Desert Classic Golf Tournament, Dubai World Cup and Dubai shopping festival are those luxurious tourist activities that are always preferred by a tourist. Additionally, the first manmade island, Palm Jumeirah, is one of such tourist destinations that are worth visiting. However, Dubai is inhibited by 1.4 million people, of whom less than 20% are natives of Dubai. This creates a sufficient skilled and un-skilled labor needs that are highly essential to fulfill the needs of development. And this has invited a large number of foreigners. Consequently, to fulfill the dearth of skilled and un-skilled labor, the Government of Dubai have allowed expatriates to serve and help the city of Dubai to become a dream destination of the tourists. Geographically, Dubai is ideally located, connecting the Indian Sub-Continent to Europe, the Far East and Africa. Besides serving a route business point, the tourists from such countries can easily reach Dubai. However, Dubai cannot avoid the threat of political instability in the region and, the criticism raised by the environmentalists over its excessive use of water and power to feed its growth of economy and tourism industry. Some recent reports suggest the ecological and carbon footprint is mostly contributed by Dubai due to its faster consumption of fossil fuels. In the following pages, the PESTEL analysis is followed by the SWOT analysis of Dubai. And in the end, some recommendations with conclusion are suggested in the light of the PESTEL and SWOT analysis. PESTEL analysis PESTEL stands for Political, Economic, Social, Technological, Environmental and Legal. The main purpose of PESTEL analysis is to understand and evaluate the impacts of the external environment on an entity or a country or a city. Without any doubt, these factors directly or indirectly influence on the strategic and operational decisions. Consequently, they are taken into account before determining and implementing strategic decisions and policies. Political and Legal Dubai is one of the seven emirates of the United Arab Emirates (Emirates.org, web). Politically, UAE is run and administrated under the authority of federation. The UAE federal government has considerable powers to determine many areas of public interest; however, certain features of governance are assigned to the member emirates to determine and implement them as they wish to do so. Currently, many policies of Dubai towards the tourism industry are considerably aligned with the guidelines of the UAE, and the same line is applicable to the legislative part as well. Economic Dubai is the second wealthiest emirate after Abu Dhabi in the UAE (Dubai. Web). Recently, the global financial crisis of 2007 has severely hit the economy of Dubai, resulting huge job losses and rising unemployment. The recession considerably put on hold the entire economy of the Dubai. However, as the period of recovery is on its way, the city of Dubai has again initiated its journey towards the economic growth and development; in that growth, the tourism industry plays a vital role. Additionally, its projects like the Burj Khalifa skyscraper have attracted vast amount of foreign investment (news.bbc, web). Technological Dubai cannot remain behind in the field of technology. DIT is the research and development initiative of Economic Zones World (EZW) (Techno park, web). The vision of this Dubai’s leading science and technological research and development strategy is to create an ecosystem supporting science, innovation, technology with an aim of leading the region towards the destiny of a value-based knowledge society (Techno park, web). Additionally, DIT is framed in a way to attract foreign direct investment in the areas such as manufacturing, research and development facilities with the use of most modern and up-to-date technologies available in the field of energy, engineering, water and logistics/ mobility. Social The United Arab Emirates enjoys the diverse culture and cultural values. After formally emerging on the global map on the world in 1971, the dedicated leadership of the UAE has made tireless efforts, energy and investment to economically develop this tiny country of the world. It required much needed manpower and human capital to ensure the achievement of such strategic objectives with the minimum possible time. As a result, it has allowed other nationalities to work and provide their contribution in the development of the UAE and the city of Dubai as well. The city of Dubai has less than 20% native residents and others are expatriates, coming from India, Pakistan and Philippine and working in both unskilled and skilled labor category. As a result, the city of Dubai has diverse culture, brought by these expatriates, basically, the religion of Islam is there to guide every aspect their social life, yet its social life is also molded by the foreigners living and working there. Environmental The per capita ecological footprint of the United Arab Emirates (UAE) is 9.5 hectares, almost four times the global average (World Wild Fund Report, 2008). And in that aggregate contribution, Dubai, being the largest city, is currently providing a major chunk in damaging the natural ecological system with its huge consumption of fossil foul. This fact is also authenticated by the current level of developmental projects and works underway in the city of Dubai to feed its demand of economic growth and development. Additionally, the presence of 15% of world’s total cranes in Dubai clearly highlighted the level of consumption of fossil fuel (Lammers, 2004). Interestingly, in October 2007, sheikh Mohammad Bin Rashid Al Maktoum, Prime Minister of the UAE and Ruler of Dubai, issued a resolution requiring from the owners of the commercial and residential buildings in the emirates of Dubai to ensure compliance with the internationally accepted and implemented environmentally friendly building standards. The SWOT analysis of Jumeirah Group The Jumeirah Group is a Dubai-based multi-national giant group serving in the hospitality industry in different parts of the world. After coming into existence in 1997, the Group formerly became a member of Dubai Holding in the year of 2004. The Jumeirah Group provides services almost all segments of the hospitality industry, ranging from hotels and resorts, restaurants, spas, and Water parks. Due to its phenomenal success and growth, the Group has invested in different parts of world in the hospitality industry. As a result, it intends to reach its current number of hotels and resorts to 60 by the year 2012 (Corporate Responsibility Report, 2008). However, despite such an exceptional growth, the Jumeirah Group cannot avoid the impacts of external threats. The use of SWOT analysis can be used to identify its current strengths, weaknesses, opportunities and threats, which are directly or indirectly influence on the corporate strategy of the Group. It is the benefit of SWOT analysis that aware a company to fully apprehend its current internal strengths and external threats. Strengths Vast experience, sound human resource policies and professional approach are among the leading strengths enjoyed by the Group. In the hospitality industry, the Group has been serving for more than 13 years. It not only operates in the United Arab Emirates, but also serves with different hotels and resorts in Americas and Europe as well. This vast experience enables the Group to provide the most up to date luxury services expected by any current or potential client. Additionally, this vast experience would have not been possible without implementing sound and effective human resource policies. Normally, employees are not called with the name like colleagues rather names such as staff members, workers and so on. But, the Jumeirah Group has a human resource policy that calls employees as colleagues. The fundamental benefit of this approach is that employees does not feel sub-ordinate rather they consider themselves as a part of family. Furthermore, the Jumeirah Group works with a professional approach. Such as, it has opened almost each segment that is a part of hospitality industry as mentioned above; rather it has moved one step further by opening its own academy called the Emirates Academy of Hospitality Management, totally dedicated to provide education, training relevant in the field of hospitality (Jumeirah, web). Weakness The city of Dubai accommodates more foreigners than natives. As mentioned earlier in this paper, majority of the population come from India, Pakistan and Philippine. As a result, majority of staff working in the Group’s hotels and resorts are foreigners. In the Group’s 2008 Corporate Responsibility report, out of total employees of 8,644, only 162 employees are locals and the remaining are the foreigners. In terms of percentage, only 1.87% (162/8,644*100) of the employees are the natives. This depicts the Group is heavily relying on the services of the foreigners. This proves to be a weakness, and may create a severe dearth of employees in case of any conflict in the Middle East besides increasing cost of serving in the industry as well. Opportunities The Dubai Government’s tourism friendly policy and the recent global economic recovery provide very attractive opportunities for the Jumeirah Group. In an attempt to increase number of tourists and facilitate the tourism industry, the Government of Dubai has established Department of Tourism and Commerce Marketing, only working to attract more and more tourists. This entire department works to guide tourists and aware current and potential tourists about the tourist spots and destinations across the city of Dubai. Additionally, globally economic situation is improving after the end of the period of global financial crisis started in the year of 2007. The improved economic situation brings more money and people become in a position to spend on luxurious activities. Threats The threat of possible conflict in the Middle East cannot be wished away. Already, there is an ongoing violent conflict between Israel and Palestine over a disputed land. Additionally, the state of Iran pursues a nuclear program for its domestic consumption; however, some western nations do not trust over the intentions of Iran. Still, this political problem is looms large. Furthermore, Iran and the United Arab Emirates do not share a cordial relationship like the one shared by the latter with the state of Saudi Arabia. As a result, these factors directly or indirectly pose a severe risk of war between or among states. In an event of any war, the first casualty would be the tourism industry as the prevalence of peace is the first condition to promote this industry. Conclusion and recommendations Undoubtedly, the city of Dubai has every potential to raise the number of tourists in the coming days. Its natural and artificial attractions and fast growth in the infrastructure development clearly are those signs that can only bring more and more tourists into the city of Dubai and can earn a substantial amount of foreign reserves. However, regional threats and its severe implications on the current pace of growth and development cannot be avoided. In this regard, some other measures may be taken into account to increase the current pace of growth. Recommendations 1. The Government of Dubai must take some concrete efforts to increase the participations of natives into the economy of Dubai. This can considerably reduce the over reliance currently on the expatriates. And this will also decrease a considerable amount of capital outflow from the city of Dubai. 2. Additionally, the Government of Dubai must take some additional steps to avail the potential geographic benefits such as facilitating the trade route between Europe, the Far East, and Indian Sub-continent. References 1. United Arab Emirates, basic facts, [Available at: http://www.emirates.org/about.html] [Accessed on 3 April, 2011]. 2. Dubai, city and economy, [Available at: http://www.dubai.com/v/economy/] [Accessed on 3 April, 2011]. 3. Techno park, technological aspects in Dubai, [Available at: http://www.technopark.ae/en/dit/dubai-institute-of-technology-dit.html] [[Accessed on 3 April, 2011]. 4. World Wildlife Fund, Living Planet Report 2010. [Available at: http://wwf.panda.org/about_our_earth/all_publications/living_planet_report/ ] [Accessed on 3 April, 2011]. 5. Lammers, E, 2009, ‘Greening the Gulf,’ [available at: http://www.thebrokeronline.eu/en/Magazine/articles/Greening-the-Gulf] [Accessed on 3 April, 2011]. 6. United Arab Emirates Country profile, [Available at: http://news.bbc.co.uk/2/hi/middle_east/country_profiles/737620.stm] [Accessed on 3 April, 2011]. 7. About Jumeirah Group, [Available at: http://www.jumeirah.com/en/Jumeirah-Group/About-Jumeirah-Group/ ] [Accessed on: 17 May, 2011]. 8. Corporate Report of Jumeirah Group, 2008. [Available at: http://www.jumeirah.com/Global/Jumeirah%20Group%20Pages/Corporate%20Responsibility/Jumeirah_Group_CR_Report_2008.pdf] [Accessed on: 17 May, 2011]. Total words excluding references = 1,997 Read More