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    Tourism: It's About Managing Competitiveness, Too

     

     
     
    © International Trade Centre, International Trade Forum - Issue 1/2003

    Tourism is a key industry to promote for a country seeking to increase its foreign revenues. For national strategy-makers, both optimism and caution are in order.

    Tourism is changing. Only a generation ago, relatively few people travelled abroad; if they did, it was usually to easily accessible and familiar places, or further afield mainly in groups. Today, many tourists are more sophisticated, making their own plans and holiday bookings - they are what tourism specialists call 'Free and Independent Travellers'.

    Most countries recognize the potential of tourism and seek to increase the number of foreign visitors, which is an opportunity to increase their exports of services. Until the last five years, the few existing tourism strategies have been mainly about selling. But even a well-organized approach to tourism promotion is not enough to constitute an adequate tourism strategy.

    Managing rapid growth

    By 2020 it is estimated that three times as many people as now will travel internationally. Where are all the extra tourists expected to go? Capacity at popular places is limited as are potential locations for intensive new development, without ruining the environment that holiday-makers are seeking.

    I am an enthusiast for the benefits that tourism can bring. But I am also concerned at the lack of coordinated management - and in many places, there is evidence of what can go wrong when tourism evolves according to demand. The question is: What to do about it?

    Generalized aspirations in a national tourism strategy are not enough. Tourism is usually concentrated in certain regions and even more locally on small, highly popular areas which themselves need specific local plans. If the key places are not analysed, planned, developed and managed, a simple national strategy is useless.

    Three precepts

    There are three ideas that tourism strategy-makers need to bear in mind from the outset:

    • The tourists will come anyway, whether the country has a strategy or not. The question is, will they be the kind of tourists that you want, and will you be prepared to receive and manage them to increase the benefits and minimize the problems?

    • Tourists are diverse: the backpacker trekking round the world is not looking for the same thing as the businessman, or the frequent leisure holidaymaker, or a person travelling to another country for medical treatment, or to visit friends and relatives.

    • Tourism strategy must not only be about selling - it is about management, about optimizing the social, economic and environmental benefits that tourism can bring.



    A perishable commodity

    Tourism is also a most perishable commodity. You can always sell a manufactured product made today, sometime tomorrow, or in the future. A tourist bed unfilled represents revenue lost forever. Tourism demand is often seasonal, so matching supply to available demand is essential for viability. In contrast to conventional industries, too, tourism makes an impact on everybody in a locality - not just on those directly involved in the business.

    Unfortunately, few countries, regions and localities have cohesive tourism strategies. In developed countries, the existing regulatory, social and commercial infrastructure provides a management context for tourism, but in developing countries this is much less evident and tourism developments are often driven by short-term financial judgements of individual developers and multinational companies. Recently 'environmental sustainability' has become a fashionable focus for local tourism plans. Cultural and community sustainability are just as important. The popularizing of crafts and traditions can cause permanent distortions if local culture is turned into a commodity to appeal to foreign visitors.

    Neglected factors undercut strategy

    Often a national tourism strategy just considers international visitors and misses or undervalues domestic tourism by residents. In developed countries with sizeable populations this will be much larger, in volume and value, than foreign tourism. In the United Kingdom, which is very successful at attracting foreign visitors, domestic tourism is still 80% of the total. Even in a developing country, domestic visits can be a significant proportion of all tourism, and most of the tourism infrastructure will depend on this home market.

    Tourism often underpins the affordability to the host community of maintaining their cultural and heritage assets. The continuity of local services, facilities and retail businesses may be dependent on tourists, even when their spending is only a minor proportion of total income, but is essential for viability.

    But what usually happens as tourism demand grows and changes? The new developments and the bigger hotels will thrive on new demand and more sophisticated visitors. Some of the more traditional and long-established mid-market hotels may use the demand wisely, upgrade and thrive. But many in the middle and bottom end of the market are unlikely to gain enough from this new demand and will decline and fail.

    Answers

    The answers to these problems lie in analysis and planning, in improving the skills of those working in tourism and developing clear management strategies, which are communicated to and understood by the industry and agencies involved. You can influence the type of foreign tourists who are attracted, the pattern of their visits and encourage the development of appropriate facilities and services to meet their needs.

    It is really important to appreciate the value of improving facilities for domestic tourists and valuing this sector, as the more people choose to stay in their own country rather than travelling abroad, the more revenue is retained within the national economy, effectively doubling its worth.

    Countering fragmentation

    Tourism is not a cohesive industry. It involves many different types of businesses: airlines, boats, bus companies, hotels and other accommodation, attractions, car hire, festivals and events, tour guides, retailing, sightseeing destinations - the list is seemingly endless. Though in most countries the major businesses are members of trade associations, the majority of the tourism industry comprises small and medium-sized enterprises, which are much less organized and much less likely to participate. So how are they to be brought into the dialogue? Methods will vary - but everyone must feel involved in the process of devising and implementing a strategy if it is to be credible and effective. Remember that some of the most important people for tourism may not even be in tourism.

    For the strategy-maker, simply dealing with all tourism-related businesses poses problems. Getting accurate statistics is very difficult. The type of statistics recorded by businesses for commercial management and accounting purposes, and by countries for border-entry controls, are not adequate for tourism management, development and marketing purposes. Com-mercially reported figures tend to be understated when values are minimized for tax and overstated to demonstrate popularity in league tables. Strategies and management cannot rely on industry sources.

    ICT is changing tourism

    ICT (information and communication technology) is rapidly changing the tourism business, particularly in research, booking and activity patterns. As yet only major hotels, airlines and key players can be booked online.

    This trend can only increase. But until most of a country's tourism businesses are online, one cannot reap the full benefits of a tourism network. In the meantime, ICT can still make it more cost-effective to communicate and gather information regarding industry performance.

    Quality standards

    Quality assurance is vital for most tourists, and therefore critical to the success of a strategy. But few places, even in developed countries, train all their staff in technical skills and customer service. Customer service, likewise, is not just a matter for hotel and resort staff. The Moroccan Tourism Office, for example, has sponsored television drama programmes, shown at peak times, to make everyone in the population sensitive to the feelings of tourists.

    Tourists often have to make choices, unseen, about what they buy. There is not yet a global system of standards to describe hotels and other visitor accommodation. In many countries, national systems do not exist because of the perceived cost of inspections, yet they could work on the basis of self-assessment, with inspections as needed in the event of complaints.

    Quality schemes require regulation, or need to be advocated by peer groups and adopted because there is real commercial value in doing so. Customer recognition is vital.

    Watch your language

    Tourism businesses are not used to the terminology familiar to export strategy-makers. However, the export-strategy terms 'border-out', 'border' and 'border-in' adapt well to the physical characteristics of tourism. For example, in considering border-out issues, tourism planners need to analyse how most foreign visitors book - through travel agents, tour operators or over the Internet in their home countries. These become the marketing targets. Border issues include licensing, visas, entry procedures and tourist taxes. Border-in issues, as in other industries, must be a key focus of strategists' efforts. Developing the right products, fostering sound management, training staff, building awareness among the public, and creating a welcoming atmosphere wherever tourists go, are just as important as creating export readiness among conventional product marketers.

    Key motivator assets

    As a strategy-maker, look first at existing tourism. One should know the profile of the country's present and potential tourists: categories of visitors, length of stay, visit patterns. One also needs to know 'key motivator assets' - what makes people come and differentiates a country from other competitor destinations? Catalogue resources, facilities and infrastructure. This can then be tested, through a SWOT (strengths, weaknesses, opportunities and threats) assessment and by applying a PEST (political, economic, social and technological) analysis. This helps define the key considerations - what tourism specialists call the 'product-market fit'. Very often, when developing tourism destinations, the existing product does not closely fit potential markets; this leads to unplanned, evolutionary changes which fix the market where it is, rather than fitting the product for where it could be.

    From this review, devise a 'product development plan' including 'aspirational resources' (what a country does not have, but wants to develop to attract preferred markets) and the in-country alliances that will improve one's position. Developments will not only involve the 'hardware' of tourism facilities but also the 'software' of people and themes. Environmental and community groups play an important part in protecting heritage and cultural assets; these may be able to build alliances with tour operators and guides. Tourism is a 'people' business, and tourists respond to a genuine sense of welcome from staff working in tourism as well as everyone they meet in host communities. It is important to build on intrinsic strengths and optimize these software aspects of tourism as well as the hardware.

    Tourists choose to visit safe and pleasant places. But what has been called the 'Disney-fication' of destinations is not the answer to providing the standards visitors demand. More sophisticated foreign tourists want to experience the real life, atmosphere and culture of a country. Preserving the intrinsic ambience is often a key factor in attracting tourists.

    International tourism is fiercely competitive. Even with the right products, success will still depend on marketing, monitoring and continuous improvement. But tourism will come anyway. Without a strategy, tourism will distort and may destroy. The economic, environmental and social benefits of a tourism strategy are too valuable to be ignored.

    Ken Robinson directs a consultancy that has worked on some 1,500 tourism development and management projects since 1967 from Los Angeles to Taiwan, from Gomera to Singapore. This article is based on remarks to an Executive Forum brainstorming on 'Tourism Development for the Secrets of Strategy Template'. Ken Robinson can be contacted at krobinsonlrt@aol.com