Challenges in Tourism Operations Management - Case Study Example

Challenges in Tourism Operations Management Destination Mecca CONTENTS 3 Introduction 3 Growing Profile of Global Tourism 4 Tourism Operations Management 6 Strategic Business Initiatives 7 Destination Mecca City 8 Challenges in Management and Operations 9 The Solutions 10 Conclusion 10 References 11 Abstract This report attempts to examine the scope of tourism operations and strategic management issues in general and their implications for the holy city of Mecca in particular. There are several challenges today that face the global tourism industry as a major business activity. These include intense competition, capacity building, quality of services, marketing operations, globalisation and cultural issues, financial management, and consumer behaviour. While on the one hand tour operators will continue to focus on different strategies and approaches to successfully expand tour business activities, on the other, there is a need to look at ways and means to minimise the adverse impacts that increasing tourist inflows impose on the city of Mecca. An attempt has been made in this paper to investigate two key challenges relating to management and operations - capacity building, and quality of services - and to make suitable recommendations concerning the possible measures to overcome these challenges. Introduction Tourism has emerged as a major business activity world wide. The World Travel and Tourism Council (WTTC) reported that tourism operations generated revenues totalling US$4421 billion in the year 2002. According to the Council's estimated projections, tourism business will grow to over US$8614 billion by the year 2012, registered an annual growth rate of 4.5% in global demand (Page, 2003, p. 2). The Council also reported that tourism accounted for almost 8% of employment worldwide, which translates to one in 13 jobs. In the year 2002, tourism-related jobs totalled a whopping 198 098 000 jobs, and according to Page (2003), this is expected to touch the magical figure of 249 486 000 by the year 2012. Stephen Page (2003) noted: "The late twentieth century and the new millennium have witnessed the continued growth of interest in how people spend their leisure and non-work time." Leisure pursuits and holiday tours are increasingly becoming a major non-work activity for millions of people across the globe. This growing interest to travel and holiday has now come to be recognised as a truly international phenomenon, or 'tourism' that motivates people to use their leisure time to visit different localities, landmarks, places and destinations across the globe. Added to this is the growing demand for tours and travels relating to specialized events, such as seasonal pilgrimages to holy sites and shrines. Among the latter, Mecca stands out as perhaps the single biggest spot the world over in terms of the number of tourists and pilgrims that flock to this holy city. Growing Profile of Global Tourism There has been a phenomenal growth in the demand for air travel since the 1960s. According to Page (2003, p. 144), the global airline industry carried 1600 million passengers (many of them tourists) to and from 10,000 airports, with 18,000 aircraft in the skies in the year 1998. Air traffic demand in Europe alone stood at 541 million passengers, and is expected to touch the 1101 million figure by the year 2015. With steadily increasing demand, several carriers and tour operators have even commissioned their own charter planes to woo tourists and to boost their tourism business. Boeing even evolved a hub-and-spokes services facility with point-to-point flight services. According to estimates, Hajj pilgrims to Mecca alone totalled the one million mark every year (2003). Among several reasons for this stupendous growth in tourism operations, the Air Transport Action Group (ATAG), a lobby group in the aviation sector, cited mainly five factors (2003, p. 3): A major downslide in the real cost of a travel Increasing activities in international trade and economic deals that call for frequent travels A rise in disposal incomes and savings, especially among the middle classes A gradual easing of travel restrictions and embargos in several countries since the 1990s such as China and South Korea Stability on the political and economic fronts in many countries Stephen Page (2003, p. 2) has also identified certain other contributory factors that have accelerated the growth of the tourism business across the world. These include the following: Growing interest among peoples of many developed and developing nations in tourism as a discretionary activity Rapid developments and modernisation of world economies with a growing emphasis on the service industries A perceptible tendency to view tourism as being closely associated and identified with 'quality of life' issues Increasing need for work-stressed people to avail a break from the complex routines and to make a welcome getaway to exotic locations Looking upon tours and travels as a basic right especially in the developed and industrialised nations in the West Recognition of tourism by many governments as a golden opportunity for generating employment and revenues Defining of holidays and tours as a major feature of non-work pursuits in the work-life-balance effort for many working people Global travel becoming more affordable for many people as much in the developed world as in developing nations Faster tour and airline bookings and operations through Internet and technology-enabled systems and services Tour Operations Management Tourism as a business venture is "constantly evolving, developing, and reformulating itself as a consumer activity" (Page, 2003, p. 3). In order to succeed, tour operators and managers need to be customer-oriented when rising to meet the growing demand for provision of effective tour and travel services. These include prompt order bookings, tour counselling, arranging of flights, accommodation, guides, and other allied services. The tourism industry has been witnessing tremendous growth in the quality and quantity of their services since the 1980s and 1990s through to the start of the new millennium. Proper planning, organising, and timely implementation of operational plans hold the key to success in any business activity, most of all in tour operations management. Strategic Business Initiatives Sandra Gountas, in her paper "Tour Operations Management" (Pender & Sharpley, ed., 2005, p. 47) aptly observed: "Tour operations forms a dynamic industrial sector characterised by expansion, intense competition, mergers and acquisitions, all of which have been pivotal to industrial development and product offerings over the past twenty years." According to her prescription, being dynamic calls for the need to identify current issues and problems relating to demand, supply and delivery of tour-related services; to understand the industry's impact and interactive framework involving the consumer base and behaviour; and to chalk out strategic approaches for gaining a competitive edge (2005). Having superlative goals, adequate resources, and good people to work with alone would not suffice for an organization to succeed in its objectives. The success of a business or organization depends to a great extent on the way it manages its operations. Operations management (OM) is that part of the business activity that "focuses on carefully managing the processes to produce and distribute products and services" (McNamara, 2005). Operations management can never succeed unless strategic planning and operational planning are well managed to begin with. Most, if not all, business organizations necessarily have to operate in a highly competitive environment. The winner among the pack usually is the one that has devised ways and means to beat competitors at their game by marketing value added products or services. Competitive advantage is the result of the exceptional value that a business provides to a customer in comparison to that offered by a competitor. Strategy can be defined as "the long-term pattern of actions aimed at altering a firm's competitive position" (Allen, 2004) in order to come out a winner. Destination Mecca City Regarded by Muslims world wide as the first and holiest place on earth, Mecca is a beautiful city in Saudi Arabia, visited by hundreds of thousands pilgrims throughout the year. Hajj pilgrim visitors to Mecca number about one million every year (Page, 2003), and is estimated to further swell in the coming years. According to another account given by the Encyclopaedia of the Orient (2005), about two million people flock to Mecca for the Hajj pilgrimage (obviously this includes the local pilgrims from Saudi Arabia). Located 80 kilometres from the Red Sea coast, this city has an estimated population of 1.4 million, according to 2003 accounts. There are three main attractions in Mecca - the Ka'ba (a rectangular building believed to have been built by the patriarch Ibrahim and his son Ismael); the great mosque or Masjid-al-Haram; and the nearby Mountain of Light or Jabal-al-Noor (Tripadvisor.com, 2005). From Pakistan alone, over 150,000 pilgrims are reported to have visited Mecca on Hajj vows this year, out of which 95,000 proceeded under the government subsidy scheme, and the remaining under the care of private tour operators. The trips involved over 281 private tour operators who made arrangements in Mecca as also Medina, which is also closely associated with the Prophet and the pilgrimage (Daily Times, 2005, Feb. 05). Based on complaints regarding unsatisfactory performance by some of the private tour operators, the government announced plans to blacklist some of them. The complaints mostly related to poor transportation, accommodation, sanitation, and healthcare facilities. Challenges in Management and Operations Capacity building and the quality of services remain as the two most important challenges in the management of tour operations and pilgrims' handling at Mecca. In many ways these two challenges, though separate, are closely interlinked to each other. Lack of adequate capacity automatically leads to deteriorating quality of services, and vice versa. It may be recalled that stampedes resulting in the death of many pilgrims is a recurring feature at the Holy City. On 2 Feb. 2004, the media reported the death of 244 pilgrims in a stampede at Mecca (The Telegraph), and the BBC reported the death of 35 in a similar stampede in March 2001. It is easy to gauge that such unfortunate incidents occur primarily due to the lack of adequate infrastructure facilities and support services to handle such a large influx of visitors at the same time. Major problems that exist in relation to operations and management include the following, among other things: Inadequate arrangements for travel, reception, accommodation, food, and health care Poor sanitation and hygiene facilities, including litter removal Ill-equipped crowd control measures, pedestrian flow, and policing services Unsatisfactory traffic control measures and violations by pilgrims by operators Inefficient administrative machinery and management to constantly plan, monitor, and regulate the stay and movement of pilgrims/visitors Ineffective resource scheduling by tour operators for assigning vehicles for tours and transfers in an optimum manner Insufficient travel, transport, and airline booking facilities Inadequate arrangements for parking of vehicles Lack of operators' training and awareness campaigns for pilgrims Poor coordination between organisers, governments and private tour operators. The Solutions Adopting the following measures can better ensure the success of tour operations management, particularly in respect of Mecca: Put in place an efficient coordinating machinery comprising of Hajj organisers, local government, Mecca city administration, foreign governments, and private tour operators Review the existing infrastructure relating to reception, guidance, accommodation, food, medical care, health and sanitation Provide adequate infrastructure to cater to the crowd, and regulate inflow accordingly Coordinate with governments, carriers, and tour operators to streamline travel bookings in tune with the capacity for handling the load of visitors Provide adequate facilities for parking, traffic regulations, and pedestrian flow Prevent congestion on the roadways Put safety mechanisms, signs/signals, and proper lighting en route Run safety awareness campaigns for pilgrims and private tour operators Seek the support of foreign governments to schedule the travel, and provide subsidies, etc. as is being done by some countries. Conclusion Tours and travels are bound to increase across the globe in the coming years. The flow of pilgrim visitors to Mecca will be no exception. At the same time, the growing demand for such tours and travels is bound to put immense strain on the administration and tour managers to successfully and safely handle the traffic through strategic planning and implementation. There is a need to adopt the best management practices in tourism, that require all concerned parties to abide by certain norms, rules, and conventions for smooth operations, including those relating to road safety and crowd management (Traveljuneau.com, 2005). The challenges of capacity building and the quality of services in particular have to be met head-on and solutions put in place to ensure success for all those involved in this fast growing industry. References Allen, W.L. & Gilmore, H. L. (2004). Managerial Planning. What Managers Do. American Management Association (e.approach, Inc), 30-44 Daily Times (2005, February 2005). Government to hold private Haj tour operators accountable. Retrieved December 02, 2005, from www.dailytimes.com.pk Encyclopaedia of the Orient. (2005). Mecca. Retrieved, December 02, 2005, from http://lexicorient.com/.e.o Gountas, S. (2005). Tour Operations Management. The Management of Tourism. Eds., Pender, L, & Sharpley, R. London: SAGE Publications, 47. McNamara, C. (2005). Operations Management. Retrieved, 22 Sept 2005, from www.managementhelp.org/ops_management/ Page, S.J., (2003). Tourism Management: Managing for Change. Oxford (MA): Butterworth-Heinemann. Traveljuneau.com (2005). Tourism Best Management Practices. Retrieved, December 01, 2005, from http://www.traveljuneau.com/downloads/TBMP_Guidelines.pdf Tripadvisor.com (2005). Mecca vacations - Mecca tourism. Retrieved, December 02, 2005, from www.tripadvisor.com/Tourism * * * * Read More