Task 1 Aims and Scope of the Report
Briefing Notes
Issue
Garbett Tours will take advantage of the benefits of Internet technologies in order to survive and last in the industry.
Background:
This report will show all the problematic area of the current system of the company and how it can be solved with the use of Internet and Information Technology (IT).
Current Situation
Garbett Tours is planning to apply Internet technology together with the concept of business-to-business (b2b) and business-to-consumer (b2c), in order for them to improve the supply chain of the company.
Key Consideration
The main concern here is how the Internet will will be able to help the company to improve and survive in the declining business of travel agency.
Background of the Company
Garbett Tours is a travel agency that started as a family business. The company started its operation in the late 1970s. It started as an agency that sells holiday package in behalf of different hotels in the Far East. To meet the needs of their target market, the company has deployed an Internet site that serves as a reference site where their customers will find the different packages that they are offering. They are also using different marketing technique such as the use of brochures and other advertisement strategies to inform their target market about their existence.
Statement of the Problem
According to Mills & Law (2005), the rapid growth of the tourism and travel industry has meant that sophisticated information technologies (ITs) are required to manage the increasing volume and quality of tourism services. The emergence of new tourism services and products together with the rapid development in tourism demand, has driven the wide-scale adoption of ITs in general, and the Internet in particular, as an electronic intermediary (p. 118).
The main problem of the company is how they will be able to cope to the fast growing and developing Internet technology and how can they apply the concept of business-to-business (b2b) and business-to-consumer (b2c) without harming the job and work of their agent. This problem started when the company has noticed that most of their customers are no longer searching for their agents but just relying on their brochures and Internet sites in choosing their package and will just go to their office if they are going to book or reserve. This shows that agents are no longer that involved in the overall transactions.
Due to the use of modern technology, most of the airline companies are selling their tickets directly to their customers and resulted in disintermediation. According to Shoniregun (2005), Disintermediation refers to the removal of business process layers responsible for certain intermediary steps in a given value chain. In traditional distribution channel, there are intermediation layers such as wholesaler, distributor and retailer, between the manufacturer and consumer (see appendix 2) (p. 40). Due to this technological evolution, airlines will no longer have to pay commission to the agents. Different hotels are also starting to direct their sales to the customer for the same reason.
Aims and Scope of the Study
This study aims to show the different problematic areas and who are involved in that specific problems and how it can be solved. The study also aims to show the benefits and the impact of the use of Internet technology in modifying, developing and improving the processes and transaction of the company.
This report will focus to different computerized internet-based information system that can be applied to manage the overall performance of the company easier and hassle free.
The study will also show the different factors that are affecting travel and tourism industry in general and the impact of different new technologies and Internet in the said industry.
This study will also shows the different effect of Internet technology to the people that are involved in different transactions of the company like the customers, the agents, the airline companies, different hotels and restaurants as well as the company itself.
Method of Enquiry
Encarta Dictionary defines enquiry as formal investigation to determine the facts regarding the case. The Oxford English Dictionary define enquiry as the action of seeking for truth, knowledge or information concerning something; search, research, investigation and examination (as cited from Study Campus, n.d.).
Garbett Tours problem can be considered as a simple system. Since all of the problems that they wanted to solved are all based on the Internet technology that they wanted to deploy. There are two kinds of enquiry method that can be used in simple systems: the inductive-consensual approach and the analytic-deductive approach.
Method 1: Inductive-Consensual Enquiry
Inductive-consensual enquiry obtains and creates a conclusion from a limited set of observation (see appendix 3) (Study Campus, n.d.). The decision about the importance of the Internet technology to the company will be based upon this approach. The limitations of the non Internet-based system will be gotten using this approach. All of the past transactions that have been done will also be analyze in order to create a web-based system that will be applicable to the company.
Method 2: Analytic-Deductive Approach
Another method of enquiry that has been used in this study is the analytic-deductive approach. This is because the solution that can be used in solving the problem was already stated. Another reason is that the problem of the company only focuses to the immediate relationship of the company to their customers and other companies or businesses that will be engaged to them in the future.
Analytic-deductive approach is an enquiry that is used mostly in simple and easy problems. This approach needs observation from different aspects and parts of the existing system (see appendix 4). By doing this approach it will be easy to know the main problem and the solution that can be done to stop that problem.
The inputs into this approach are plain and simple ideas or basic proposal that breaks a complex phenomenon down into its basic components. According to Hartford Institute, analytic enquiry system places extreme emphasis on logical consistency. Anything or anyone violating the notion of logical consistency is to be ignored or dismissed in the strongest terms (Study Campus, n.d.).
Weaknesses of Approaches
According to the Hartford Institute, the weaknesses of the two approaches used: there is always one single answer, a number or a truth, but this truth can be found only if a person or a team that are conducting the method are working hard enough; both of the approach share the fallacy that the definition of the problem itself is problematic, when in fact it is in making this very definition.
Task 2 External Drivers that affects the Tourism Industry
Briefing Notes
Issue
This study will show the different factors that are affecting the tourism industry in general.
Background
There are many factors that are affecting the tourism industry. This can help as well as harm the industry, globally or locally. The four main factors that affecting the tourism industry are the: political factors, environmental/economic factors, social factors and technological factors.
Current Status
The global tourism industry is now suffering from different event that are affecting tourism like natural calamities such as the hurricane Katrina of USA, Tsunami in Bali; in the brighter side, the Beijing Olympics help boost the tourism industry of China.
Key Consideration
The key consideration of this report is to show how different factors affect the growth or decline the tourism industry. Another is the effects of global warming and climate change to the industry.
The Tourism Industry
According to Sinclair & Stabler (1991), during the past few decades tourism has emerged as one of the world’s major industries, exceeding in importance many manufacturing industries and other services in terms of sales employment and foreign currency earnings. Currently, tourism has become normal part of daily life (Glaesser, 2006, p. 1). Tourism has many positive effects, for tourists, holiday means satisfaction as travel gives them the opportunity to bring their homes and dreams to life. Furthermore, by spending holidays outside their common environment, tourists increase their awareness of other cultures and ways of life, be it knowingly or unknowingly (Glaesser, 2006, p. 1). According to Glaesser (2006), this changed view of things helps to foster greater acceptance and tolerance among the human race (p. 1).
Tourism industry in many countries has achieved a leading position and become one of the most important sources of income and foreign (Glaesser, 2006, p. 1). According to Glaesser (2006), the growth of tourism industry will continue in the future and will continue to make it as the most significant industry in the world (p. 1).
PEST Analysis
According to Glaesser (2006), tourism is like no other industry, in a position to create prosperity and economic development opportunities even for places that would otherwise be considered as difficult to develop (p. 1). However, positive development of the tourism industry is gradually being affected by different factors: political factors, economic or environmental factors, social and technological factors.
Political Factors
War and conflict between two different countries and between different groups of people inside the country can greatly affect the tourism industry. Political conflict such as clash of two political figures or political parties is also one of the great factors. Like for example in the Philippines, the tourism industry in the said country is affected by rallies against the current president and administration. Travel and safety issue are also one of the greatest political factors, since the primary reason of tourist in spending holiday is to have a peaceful vacation. The terrorist attacks in Egypt, 9/11 bombing in America, Tsunami in Asia are only example of events that have affected the tourism of different countries due to safety issues. Health issue is also another one of the greatest factors that is affecting the tourism industry in the world. The greatest example is the outbreak of Severe Acute Respiratory Syndrome or SARS in mainland China. The outbreak of Avian flu or also known as bird flu in different part of Asia. Monetary issues are another matter, the foreign exchange, the tax and the cost of living of different countries can affect the stay of the tourists.
Economic/Environmental Factors
Seasonal and weather issue is one of the primary economic/environmental factors that affecting the tourism industry. A natural calamity such as the Hurricane Katrina that hit million dollars of assets and takes many lives is one of greatest example. Most of the expert says that global warming and climate change will be the greatest environmental factor that will affect the tourism industry in general.
Social Factors
Advertising and publicity is the greatest factor that affects the tourism industry of a country. Publicity is depend if it is good or bad publicity, but just like an adage says, “Good or bad publicity is still a publicity”. The image of the country is also another matter, according to International League Table, Scandinavian countries are the most peaceful countries and Iraq is the most dangerous and violent (Campbell, 2007). Fashion and role model also has a great impact to the tourism industry of a certain country. Example of this is the craze of the most people in Asia in so called Koreanovela or Korean drama. Because of this craze, most of the tourists are visiting those places that have been featured in different koreanovela. Major Events are also a magnet for tourists, just like for example, the Beijing Olympics that have been held to China. Buying and access trends is also one of the factors, Hong Kong is well known as the shopping capital of the world, since they are offering many establishments that are offering high quality fashion products in a very reasonable price.
Technological Factors
Information and communication technology such as the presence of different communication gadgets and services such as G3 and Internet is one of the greatest technological factors since communication is very important nowadays. The advancement in different transportation medium is also an important factor such as modern airplanes and cruise ships.
Task 3. Impact of Internet
Briefing Notes
Issue
The main issue here is the impact of the Internet technology to the global tourism industry as well as how it will affect the Garbett Tours.
Background
Internet and IT helps the tourism industry to lessen the time and effort to be spent by the customer by booking and reserving plane seats and rooms. Here are the two of the most used online system in tourism industry:
- Online Booking System (OBS)
o Online Reservation System (ORS)
Current Status
Recently the company is not using any of this system; instead they are using their website as an advertisement medium by placing all the available package of the company.
Key Consideration
The Key consideration here is how the Internet can affect the overall performance of the company as well as what are the benefits that can be acquired using this technology.
Impact of Internet on the Tourism Industry
According to Buhalis & Costa (2006), Tourism as a phenomenon is constantly pushing its frontier forward, expanding its importance and involving more people globally. Tourism is now the world’s largest industry. Evidence clearly demonstrates that the industry of the twenty-first century will move further than it has ever thought. From the mere people 25 million international arrivals registered in the 1950s, tourism had climbed to the impressive figure of 700 million international travelers by the turn of century and generated a considerable proportion of the GDP in most countries of the world (p. 1).
The rapid growth of travel industry also means growth of state of the art and sophisticated Information Technology (IT) IT is required to manage the increasing volume and quality of tourism services and products (Mills and Law, 2005, p. 117). According to Frew (2004), the Internet has created a new landscape for the tourism and travel industry. Consumers now have a direct access to the basic services through the providers’ own business to consumer (B2C) sites or through portals such as Expedia or Travelocity. However, most small to medium-size businesses are still left out of the Internet revolution (p. 380).
Internet has been a great help for many businesses around the globe. It is one of the worldwide used advertisement strategy as well as strategy in selling products and service around the globe. The primary reason behind this is that it is cost-effective. Most of businesses today, either big or small firm are investing into Internet. The impact of Internet can be said to include every aspect of the travel and tourism businesses, from information distribution and marketing to travel and tourism products and services purchases. Forrester Research in 2002 project that the number of Americans making online travel purchases in 2002 grew to 23.3 million households. It has also predicted that online leisure travel sales totaled $ 3.8 billion.
Zhou and Lin (2000) also conducted a survey on the use of the Internet versus the printed brochure. Their findings show that the majority of the respondents had Internet access at home, followed by 34% at the library and 31% at the office. When asked which source of information that they will depend on the most for their future trip planning, about 43% reported that they would use both printed brochures and the Internet and 37.8% would use only printed brochures.
However, if we add those who will use both printed brochures and the Internet and those who will use only the Internet, Zhou (2004), come up with a figure as large as 58%. In other words, nearly 60% of people will use the Internet either as the sole or as a complementary source of travel information (p. 8).
According to Mathies & Weiermair (2004), Today, tourism industry is one of the major users of the Internet Technology, with between 33 and 50 percent of all consumer based Internet transactions being tourism related (p. 285).
During the past era, travel involved a lot of time, effort and risk; this was solved with the discovery of the Airplane by the Wright Brothers (Shajahan & Privadharshini, 2004, p. 170). Although the travel time was reduced, the problem with regards of reservation and booking are also persistence. With the use of Internet and IT, this problem was solved. The following are the systems that are used in tourism industry.
Online Booking System (OBS)
Online Booking System or OBS is a real-time payment method that includes a secure Internet banking payment solution, credit card or bill, the same as in bookings made through traditional channels (Winfried, Tschammer & Amarger, 2004, p. 481). This help tourism related companies and businesses to target a much larger market as well as help lessen the work of agents as well as the effort of the customers.
Online Reservation System (ORS)
Pizam (2005) define Online Reservation System or ORS as a system that tracks those reservations reaching the hotel directly from telephone, mail, hotel-to-hotel, e-mail, cable and fax (p. 344).
It includes accommodations providers for hotels, bed and breakfasts, property management companies and vacation rental properties. It can accept online reservation from the company’s website to ensure proper management of inventories (OnRes, n.d.).
ORS will help the company to communicate to another company without the hassle. Garbett Tours will no longer have to go to different airline companies, hotels and restaurant just to reserve for rooms and seats.
ORS of different airline companies will help Garbett Tours to reserve plane seat in just one click of a mouse. They can also choose from variety of schedules and class of the plane the customer will request.
Task 4 Impact of Internet to the Garbett Tours Management and Staff
Briefing Notes
Issue
The issue here is the effect of Internet to the management and staff of the company.
Background
Internet will help the company by having a competitive edge against their leading competitors. It will also help their customers to save time, money and effort. Unfortunately, the effect of the said technology is not that good against the staff of the company. Internet will lead to loss of jobs for the travel agents.
Current Status
Currently, the company is having difficulty for the commission-based relationship with their partners; this is because hotels and airline companies are beginning to work on their own by direct selling.
Key Consideration
The primary consideration here is the good and bad side of applying Internet to the company, to the staff and customers.
According to Bigdoli (2004), for the tourism industry, the Internet is clearly the biggest opportunity but simultaneously the biggest challenge (p. 469). See appendix 5 for the effect/probability/action grid of the Impact of the Internet to the company.
Impact of the Internet to Garbett Tours
Internet indeed has a great impact against many travel agencies in different part of the globe. Because of Internet it will be easy for Garbett Tours to implement their b2b and b2c communications and relationships. Internet offers a great medium for marketing strategy and advertisement. Due to this fact, the company will no longer have to spend that much money in advertising in billboard, newspapers, billboard on wheel, leaflets and other mode of advertisement. The company needs only to invest less for that kind of advertisement and maintain their website for easy retrieval of information for the customer. Internet also helps the company to communicate with their partner companies including the airlines, hotels and restaurant. With the help of Internet and online systems, it will be easy for the company to book and reserve for the products and services of different companies. This event helps the company to develop their b2b relationship.
Impact of the Internet to the Garbett Tours Staff
Internet has a positive impact to the management of the Garbett Tours, however, its impact to the travel agents or the company staff is virtually negative. Because of Internet technology, all the information regarding the packages and incentives that a company is offering, most of the customers are not enquiring to the travel agents anymore. And the presence of OBS and ORS, will also limit the work of the staff in the company. It will lessen the work of the agent which is somewhat positive, but it also means that they will no longer receive commission from the airlines and hotels.
Task 5 Soft System Methodology (SSM)
Briefing Notes
Issue
Developing a Soft System Methodology (SSM) will help the company to dig in to the problem and see the overview of their current system.
Background
The company will be implementing two major changes: the application of Internet-based systems and telemarketing. This two reconstruction plan will help the company to improve their service as well as provide for their staffs.
Current Status
The company is choosing the right software that will be helpful in developing their overall performance.
Key Considerations
The key considerations here are the people or organizations that will be affected by the change such as the staff, the customers, the company itself and their partner companies.
Soft System Methodology or SSM, according to Vissher, Fung & Wild (2001), involves a more holistic approach which is intended to incorporate the human element of such systems into the systems design work (p. 102).
Stage 1 – The Problem Unstructured Stage
The problems and defect of the current system of the Garbett Tours will be defined and analyzed during this stage. The people that will be involved during this stage are the travel agents and other company’s staff, the partner companies and the customers. The problem will be rooted from the different perspective of different people that are involved and in the end will locate the main problem that is causing other problems.
Stage 2 – The Problematic Situation Expressed
All the necessary data and information that will help in developing the proposed system will be gathered. This will include the entire problem or the inconvenience of the different people involved such as the customers, the staffs and the partner companies.
The rich picture will also be drawn during this stage. According to Couprie et al, rich pictures are used to provide a model for thinking about the system and to help the analyst to gain an appreciation of the problem situation. The rich picture of the case of Garbett Tours is shown in Figure 2.
Stage 3 – Root Definition of Related Systems
According to Couprie et al, A root definition is expressed as a transformation process that takes some entity as input, changes or transforms that entity and produces a new form of the entity as output.
The first root definition is the application of the Online Systems. This will help the company to serve their customers minus the hassle.
The second root definition is the application of telemarketing. Telemarketing will help the company to answer the questions of the customers without seeing each other. This is to help train the staff to be more efficient at work. This will also help to retain the staff.
Stage 4 – Conceptual Models
The first root definition deals with the application of new Internet technologies to the company. This will start by hiring a web-based system expert and by choosing the right software and hardware that will complement the protocol and rules of the company. This shows a continuous process because maintenance is the most important part of the systems development.
The second root definition also shows a continuous process because it is also in great need of maintenance and training.
Stage 5 – Identification of Feasible and Desirable Change
During this stage, the desirable change and feasibility of the company that is based on the evaluation of the situations will be categorized. There are different changes that can be done: changes in structure, changes in procedure and changes in the attitude of the entire organization.
To solve the problem of the company regarding their relationship to their customers and their partner companies, they must involved their selves to the transactions and must maintain their system by directing to the needs and demands of the customer as well as offer services and guide that will cause convenience on their part.
Credit:ivythesis.typepad.com
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