Management. Business function and processes (Tourism) - Research Paper Example

? xxxxx No. 12345 (MANAGEMENT) BUSINESS FUNCTION AND PROCESSES ABC Xxxxx xxxx College Department of Business Management 17 April, 2012 Table of Contents Contents Page No 1. Introduction 03 2. Market Analysis 04 3. Operations 05 3.1 Tourism and Shipping 05 3.2 Hospitality Operations 06 4. Marketing Strategies 07 4.1 Production Strategy 07 4.2 Communication Strategy 07 4.3 Promotional Strategy 08 4.4 Sustainability Strategy 09 5. Factors Affecting Cross-Culture Business Communication 11 5.1 Language 11 5.2 Environmental and Technological Considerations 12 5.3 Social Organization 12 5.4 Context and Face-Saving 12 5.5 Authority Conception 13 5.6 Nonverbal Communication Behavior 13 5.7 Time Conception 13 6. Human Resource Management 14 7. TUI’s Internationalization: Impact on Customer 15 8. Communication and Information Technology (CIT) 17 9. Risk Management 20 9.1 Staff Risks 20 9.1.1 Fire 20 9.1.2 Terrorism 21 9.1.3 Healthy and Hygenic Environment 21 9.2 Technical Risks 21 Conclusion 22 Bibliography 23 1. Introduction TUI, abbreviated for Touristik Union International, was established in 1968 with headquarters located at Berlin, Germany. TUI is the largest integrated tourism group in Europe, lagging far behind its competitors with a turnover of about € 21,866 million in 2008. Initially, it worked as Preussag AG and gained a renowned fame in the field of transportation and industrial sector till 2001. This year, it became a 100% subsidiary of Preussag AG. In next year, Preussag AG was transformed into TUI AG. During next few years, TUI developed and changed its production from industrial segment to a modern tourism and shipping company. The general credibility of the TUI is quite excellent. Strategically today TUI is the largest and leading tourism and shipping organization of the world, operationally active mainly in Central, Northern and Western Europe while it has the networks across the Europe as well. The inventory of TUI is decorated with hotels, restaurants, retail stores, container ships, travel agencies and airlines. TUI has €14,917.5 million current and non-current net assets and liabilities (Interim Annual Report, 2009). On December 2008, TUI had 70,200 employees (TUI Annual Report, 2008), 285 hotels with 163,000 beds in 28 different countries including 84% four or five star hotels, 79 tour operators in 18 countries, 120 aircraft, 10 cruise liners, and 443 subsidiary companies (http://www.tui.com). At present, TUI AG has 43.3% shares in Hapag-Lloyd AG. During the fiscal year 2008, TUI had revenue about €759 million. One of the unmatchable entrepreneurial landmarks of TUI is its continuous structural progress and upgrading services offered to worldwide customers. Contrary to its rivalries, TUI is very successful in both the tourism and shipping divisions because of its advanced attractive products and services as well as the expansion of new and strong brands. However, the performance of TUI has been affected badly due to ongoing war against terrorism, natural calamities, global recession and lack of customer confidence. Prior to 9/11, TUI had more dynamic growth from 1995 to 2001. Post 9/11 affects really restricted the TUI’s expansion strategy especially in various countries of Asia. Since China is an emerging market, therefore TUI had planned a broad strategy but war in Afghanistan and its further affects in Pakistan kept TUI to hold up its venture in China (http://www.tui.com). In such political and military situations, TUI decided to launch its new segment in the form of a network of fast food outlets in major cities of UK and Greece instead of Asia. The long term success of TUI in Europe also forced its top management to expand the company’s growth into competitive markets of Eastern Europe. With the intention of mounting its potential, developing activities, and to attain a sustainable lead against its rivalries, TUI has decided to launch its tourism network in the markets of UK and Greece. In the first phase of its new project, 10 fast food units have been planned to open in different cities of UK along with a network of tourism, shipping, and other operations while in 2nd phase company will venture into emerging markets of Eastern Europe especially the Greece. TUI is a well reputed tourism and shipping company which will need a strong strategic infrastructure for its internationalization. The primary aim of this report is to analyze the effects of expansion strategies of TUI on its associated business functions by venturing into competitive and emergent markets of UK and Greece. 2. Market Analysis Since careful and successful market segmentation is very much supportive to the success of a new business especially to launch across the borders, therefore TUI has a special emphasis on it. The organizations which understand the need and trends of the market, consumer behaviors, and demographic features of the area of operations, certainly come on the track of success. UK fast food is the largest fast food market in Europe which is double and triple in size than Germany and French markets respectively. The food industry (including fast food) had an estimated gross value added of ?73.4 billions in 2007 (http://www.whatmattersweblog.com). It had a contribution of 18.8% of national part-time employment and 8.7% of national full time employment. In terms of catering and hospitality, the burger sector is leading and it had revenue of ?9.33 billion in 2008. This revenue was 4.2% greater than the previous year and it was 22.2% of the total fast food market. By including the business of coffee shops, the revenue would reach ?11.22 billion, greater than 4.4% of the year 2007. The global turndown of 2008 has benefited the UK fast food industry as it increased its presence by 8% in 2009 as compared to the last year (http://www.whatmattersweblog.com). Similarly the branches of fast food restaurants have also increased by 8.2% in ten major cities of UK within one year. According to Food for Thought review, Domino’s and Eat were the most popular and successful while Burger King was the least successful brand in 2009. During 2009, pizza chain of Domino’s, healthy fast food group Eat and sandwich chain Pret A Manger have increased their growth by 50%, 36.4% and 29.7% respectively (http://www.caterersearch.com). McDonalds entered in the fast food industry in 1974 and today it is the mot dominating fast food chain in the world. According to BHA’s Trends and Statistics 2007, it has more than 1300 outlets in UK. The company deals about 47 million people daily on its 31,000 worldwide fast food restaurant chain (www.mcdonalds.ca/en/aboutus/faq.aspx). KFC is the second largest fast food company operating more than 700 outlets in UK. 3. TUI Operations 3.1 Tourism and Shipping TUI’s business strategy is aimed at expansion oriented strategy. By utilizing available resources, the target of TUI is the expansion of its infrastructure in new emerging as well as already established markets. In order to gain this target, TUI follows the current trends to increase its direct trades which include modular reservations, globalizations, innovative gastronomy, expansion in routes of its airlines, and providing hospitality management in new emerging markets in Eastern Europe and Asia. The decision of globalization has highlighted that the company needs in expansion of aircraft fleet and hotels which are the main assets to contribute to the development of TUI’s tourism department across the Europe. In the shipping department, TUI follows growth strategy. The strategy is based on two observations i.e. to see the projected volume growth in the shipping industry and seeking of positive economic environment. In new operational environment, TUI can achieve its targets by expanding its internal shipping growth to different parts of the world plus by enhancing the capacity of its containers. TUI also intends to take its shipping services on inner-Asian and European routes, the routes between Eurasian countries as well as North American countries (http://www.tui.com). 3.2 Hospitality Operations Although history provides a guideline for future, however, hospitality operations by default cannot depend only on previous trends as consumer behavior. Other depending factors can substantially shift the trends and markets (Denny & O’Fallon, 2007). The growth and economy of hospitality operations of TUI are somewhat affected by the internal and external opportunities and risks associated with internationalization. These opportunities and threats related to hospitality operations are reviewed to vary the consumer markets (Goek, 2007). The entrance of TUI into a markets of UK and Greece where market capitalization is of course quite attractive, the major challenge to its hospitality operations will be the existing competitive environment from dominant rivalries. Thus in hospitality operations, TUI can face more loss due to strong challenges in market starting from entering into market to the operational level. Gastronomic issues of hospitality operations may be affected by various elements like religion, culture, globalization, and leverages with respect to financial crisis and competition in both countries. 4. Marketing Strategies 4.1 Production Strategy Initially TUI managers need to go through the relevant literature review of internationalization and then a research must be conducted according to Kolb's model of experiential learning based on four elements i.e. concrete experience, observation and reflection, formations of abstract concepts and testing of these concepts in new situations (Kolb, 1984). It will enable the company to carry out a dual strategy in developing its business in a totally new environment. One strategy is to invest heavily in research to discover and develop innovative trends and demands through public surveys. These surveys will assist the top management of TUI to establish a record of information regarding demographics, interests and comments of general users in respect of different operations like hotel accommodations, hospitality, shipping, or travelling etc. With the help of this collected database, necessary improvements can be done and therefore TUI will ensure to meet the interest of customers’ demand regularly. In order to gather the data, TUI can primarily use internet and its website as a medium to carry out its publicity and research surveys in new markets. 4.2 Communication Strategy In order to gain its initial short terms goals in UK, TUI will highly depend on its communication strategy with its clients. Advertising policy is a key factor. Different modes of communications like TV, radio, internet, and print media will allow TUI to get the best online and offline advertising. To make the communication more effective and productive, a permanent agreement can be made with some advertising consultant agencies to carry out this important campaign. TUI will search for trustworthy advertising partners through initial collaboration. The partners and advertising agencies will be chosen with respect to their performance and reputation. The advertising partners will cater the need of TUI to be publicized by electronic, print, and online media. It will specifically include a detailed situational analysis in the context of market environment and to the requirement for the venture. The stakeholders of TUI will be preferably involved in marketing communication to judge their needs and to exclusively identify the standby options for the project. Additionally the objectives and assumptions of the project will be distinguished according to the desired standards of internationalization. The marketing managers of TUI will be held responsible to keep a constant eye on the content of the ad, design layout, and dissemination of the message. The same department will also be responsible to supervise the business activities in advertising field and to keep a track a record of consumer behavior of new venturing markets. 4.3 Promotional Strategy Promotional plan of TUI units will incorporate a variety of marketing connections in new of frame of operations. Therefore, in order to monitor and observe the services, products, and market position, TUI will arrange a program to receive the feedback from the customers. Different techniques can be applied to do this such as telephonic conversation, direct mail, opinion through public surveys and online comments. Since internet is the most ready and widely used medium to communicate, therefore TUI newly built fast food units would launch their own websites which will be one of the main communication channels. Moreover, internationalization into UK and Greece has put the brains of TUI to think and emphasize on its pricing strategy. When a company makes some special plan for internationalization of its products, the most significant factor to be catered is the evaluation of price of products in the projected target markets (Keegan & Green, 2003). The local customers and international tourists can be attracted by providing them with best accommodations, travelling, and hospitality services in UK and Greece on competitive but affordable rates. A detailed survey on pricing will enable the top management to adjust the price for competition. Most business fields have become more productive by proliferating online services. Same the case began in 2004 in the field of tourism industry where online tourism business absolutely changed the whole industry. Now educated tourists constantly use their web based knowledge for purchasing different tools to manage their vacations and business tours in energetic and flexible ways. Due to this increasing trend, TUI will also devotedly change its innovative growth strategy in UK and Greece by leveraging the internet power to its customers with latest expediency and cutthroat charges. TUI will offer its online services to its customers with the options to choose desired traveling mode plus the choice of travel dates, accommodations, destinations, schedule of flights and gastronomic information on its restaurants and fast food points. 4.4 Sustainability Strategy Fresh, pleasant and healthy environment, in both natural and man-made forms, is one of the prerequisite of the tourism industry. However, there is composite correlation between tourism and the environment because tourism industry is associated with such activities that have significant adverse effects on the environment. A large number of TUI operations have a direct impact on general infrastructure such as airports, roads, restaurants, hotels, resorts, shopping malls, amusement parks, and golf courses etc. The growing set up of TUI in UK and Greece may cause negative impacts on environment. Firstly, a negative effect is the depletion of natural resources. One of the most critical natural resources is water which is overused by tourism companies in their restaurants, hotels, parks, swimming pools and personally by the tourists. Tourism puts extra pressure on local resources like gastronomy, energy, and other raw materials that could be already in dearth. Moreover, increasing trends of construction and entertaining facilities of TUI have caused the reduction of land resources like fossil fuels, raw materials, forests, wetlands, fertile soil and wildlife. Forests suffer more severe consequences by TUI in the form of deforestation caused by land clearing and fuel wood collection. The second bad effect of tourism or TUI may be the production of polluted air in its atmosphere. It is done by the emission of greenhouse gases, noise, solid waste and littering, and burning of carbon and chemicals. Lastly, sandy beaches, streams, waterfalls, lakes, mountain slopes and tops, and riversides are most attractive highlights for tourists. These places are not only producing dreadful conditions for ecosystems but they also create erosion of soil. Having a background of sustainable business policy, TUI keeps a high strategic priority between environmental quality standards and their effective implementation in all the activities of its affiliates. The key feature of its sustainable environmental strategy is that in each affiliated company and in each country, TUI maintains a close liaison with the Environmental Protection Agencies (EPAs). In present scenario, TUI and all its affiliates have steady environmental quality standards with the strategic applications to TUI’s sustainable policy. Ecological and sustainable operations are the basic measures of TUI to the protection of climate and perseverance of biodiversity. Environmental monitoring, energy consumption, and reducing the emission of carbon dioxide are the three major strategies of TUI’s sustainability management (http://www.tui-group.com). 5. Factors Affecting Cross-Culture Business Communication Whenever a company decides to expand its area of operations across the borders then regardless of type of business, it cannot establish itself in a standard fashion with different cultures. As a result, relationships and business can be enhanced only when people understand the communication gaps and try to overcome it from different cultures and find new approaches against old problems. The decision of TUI to go international in UK and Greece will certainly arise a great deal with communication problems because the staff from home country will face challenges to understand the cultural differences in traditions, practices, and thought processing. Language will play the key and deciding role in entry phase. For internationalization, language is a key determinant factor not only to select the target markets but also to successfully execute the marketing plan (Wigley, Moore & Birtwistle, 2005). In the process of an international business, TUI will face cultural problems which directly affect the communication through seven variables known as LESCANT Model. 5.1 Language Language is considered as the most often cited barriers to conflict-free cross-cultural business communication. Language difficulties will affect TUI’s marketing and human resource by three different ways. First one is gross translation problems which mean delicate differences from one language to the other and culture oriented variations among speakers of the same language. Secondly, enunciation approach and phrases may also create barriers in TUI’s business communication. The 3rd language barrier may be the national prejudices and class distinctions which are often reinforced thorough sociolinguistics language. TUI will have to arrange special training programs for its key position holders to understand local languages and therefore to get rid of this basic barrier. 5.2 Environmental and Technological Considerations Generally people know the utilization of technology according to their own culture. Subsequently, it becomes difficult to adopt or to understand the technological needs with respect to other cultures. Through environmental orientations, TUI will encounter problems through several factors which include nature of local climate, topography, population size, population density, and the relative availability of natural resources. The local culture of UK and Greece will influence the organizational culture of TUI through various aspects of technology i.e. control, subjugation and harmonization. An organization can resolve such communication barrier by appointing efficient staff through geocentric staffing policy. 5.3 Social Organization The social organizational culture of TUI will be tremendously affected because horizon of cultural differences is very vast in host countries. It will count favoritism, educational principles, class structure, religious ties, job status, economic situation, political affiliation, racial discrimination, gender differences, work place behavior, and recreational institutions. 5.4 Context and Face-Saving Communication highly depends on the context in which the communication is going on. Fewer words or gestures are used to communicate the message provided both the sender and receiver understand the context of business communication. Hall (1959) was the first who defined the term contexting. “The matter of contexting requires a decision concerning how much information the other person can be expected to possess on a given subject. It appears that all cultures arrange their members and relationships along the context scale, and one of the great communication strategies, whether addressing a single person or an entire group, is to ascertain the correct level of context of one's communication”. This problem can be resolved by selecting the most efficient and devoted people that will not be needed to understand the language rather the context will lead them to the required actions. 5.5 Authority Conception Different cultures often have different authorities in their society. Hofstede (1991) defines it as "the extent to which a society accepts the fact that power in institutions and organizations is distributed unequally". TUI is needed to establish a decentralized framework to break this communication obstacle because generally in decentralized business organizations, people pay much attention to that person who says something with logical argument (Hamblin, 1974). By contrast, in a centralized cultural organization, the attention is paid very seriously to high-ranking individual, even if one disagrees. 5.6 Nonverbal Communication Behavior This is the most prominent intercultural communication barrier which TUI may face. A writing message just indicates the knowledge of a culture through words but nonverbal communication is associated with numbers of areas i.e. eye contact; dress or body language; responding behavior; and para-language. The problem can be addresses by setting a lifestyle standard to the key staff of TUI in UK and Greece. 5.7 Time Conception Another communication hurdle in the international business is the temporal understanding of time. Mostly cultures fall into two types of temporal conception. The first one concentrates on the schedules of personal interaction while second follows temporal contribution and achievement of existing transactions. 6. Human Resource Management Human Resource Management (HRM) mainly deals with the selection and appointment of suitable human resource to perform particular jobs. Further it provides assistance for developing and promoting a particular business culture (Hill, 2003). The success of internationalization of TUI will not only be highly dependant on the successful implementation of HRM policies but it will also compel the higher management to adopt some particular HRM policies in UK and Greece instead of taking up routine steps. The top management has to ensure the formulation of HRM and staffing policies harmonious with organizational business strategies and especially with its formal and informal structure in abroad. Venturing into the markets of UK and Greece, TUI will certainly have to change its staffing policy as well. Generally, three types of staffing policy are applied in business field i.e. ethnocentric, polycentric, and geocentric staffing policies. Internationalization will oblige the TUI to apply ethnocentric staffing policy to appoint top level managers in UK and Greece because in an international business, an ethnocentric staffing policy concentrates on appointing all key staff positions from parent-country because sometimes aappropriate staff is not available in host country. Additionally it also provides firm command and control over subsidiaries. By adopting this technique, the global hospitality of TUI will get an international icon because it suits the company having centralized approach to globalization (Ball et al, 2006). If analyzed critically, it is observed that ethnocentric staffing creates cultural myopia in organization (Hill, 2003). In the polycentric approach, parent-country nationals hold key positions at company headquarters while host-country citizens manage foreign subsidiaries. This staffing style can curtail the risks of cultural myopia. For a multi-domestic strategy, this is considered as the best policy and will be ideal for TUI to appoint its middle level managers. In fact by applying this approach, the organizations make the local personnel responsible to know about local production and avoid relocations from home country. Despite of its few advantages, TUI however, may observe some gaps between home and host-country operations as home country staff will manage business operations in Greece. Geocentric staffing policy, regardless of nationality, emphasizes to employee the best, skilled and proficient staff for key positions throughout the organization. This staffing policy is good for both national and international business strategies as it has a constant contribution to produce an informal management network and a unifying culture in the organization. In order to fill up the vacancies below mid-level managers, TUI will have to apply geocentric approach. 7. TUI’s Internationalization: Impact on Customer Certainly TUI will get a positive edge by making further growth in UK and Greece and it will not only increase the numbers of its customers but will also change the behavior of the consumer. Wayne and Deborah (2009) define the term consumer behavior as “Consumer behavior reflects the totality of consumer’s decisions with respect to acquisition, consumption, and disposition of goods, services, activities, experiences, people, and ideas by decision-making units” (Wayne & Deborah, 2009). The main aim of marketing strategy of TUI is to generate positive attitudes in its customers by providing innovative hotel services and hospitality. For its globalization process, TUI has an approach toward some inclusive description in context of a core relationship between consumer behavior and marketing strategies. One way of analyzing the markets is to review and examine the projected goals through customer satisfaction, communication, and anticipation. It is quite normal for TUI to conduct public surveys to judge the consumer behavior and to find out their primary target market in both countries. By doing the same, TUI will understand the needs of their customers better than competitors because this approach helps the organizations to put impressive influence on their customers and execute strategic marketing more effectively (Jobber, 2001 and Peter & Olson, 2008). TUI managers have asserted that attracting the new customers to their new projects is much cost effective and harder as compared to retain the existing customers, therefore organization will apply ‘Below The Line (BLT)’promotion model which deals to keep the existing customers loyal with their new products and to attract the potential customers through some comprehensive advertising campaign and marketing plan (Lanman, 2003). Tourism is a certain industry, primarily highly influenced by cultures and social norms, therefore, TUI and other specific companies use celebrity endorsements to put a direct expression to the customers (Bohdanowicz & Clamp, 1994). The mind setting and decision making process in purchasing or dealing with any of the services of TUI is complex because consumer behavior is always dynamic and influenced by several financial, social, and cultural factors (Solomon, 2006). Since consumers buy some product either for their own use or to give it to someone for use or as a gift, therefore, the first step in purchasing of an item is need recognition with respect to social or emotional perspective of the consumer. This need recognition depends on the significance of the problem and the disparity between the present and desired situation. The advertising campaign of TUI, its offerings, and more importantly its reputation will make a big deal with customers’ trends. In case the gravity of recognition is quite high, then few more stages pass through prior to make any decision e.g. searching of information and its evaluation process (Foxall, Goldsmith & Brown, 1998). As products are generally constrained with social status, values, and self-esteem, therefore these changing forces not only evaluate the gravity of problem but also unveil the individual’s personality (Entwistle, 2000). The evaluation process involves the level of involvement of the consumer specifically with respect to price as it is considered as the primary indictor of involvement level because this is the area where consumers spend their time more than any other evaluation. Customers, being part of the same society, get inspirations from different types of people and it is quite significant for TUI to have a good idea about those people and their roles who influence the decision making process of its target market. Advertising theories and their applications cannot persuade an immediate behavioral response amongst the target market; however, customers’ behavior can be altered and convinced through some series of mental effects. TUI internationalization process can attract the customers and change their behavior by influencing positive attitudes towards different brands and it will use certain theories and models to do so. By applying Consumer Involvement Theory, TUI will basically deal with the understanding of psychology and behavior of primary target market and elaborate how much time, collaboration, and resources are used in the purchasing process (Creighton, 1981). TUI has a substantial impact on customers also motivates the customers towards the positive attitudes of its services like hotels, tourism, air travelling, shipping and hospitality. Hierarchy-of-Effects Model (HEM) is considered as the predominant model of advertising because it elaborates the goals of advertising without any ambiguity. This model presents six steps which a consumer takes while purchasing a product or service which include awareness, knowledge, liking, preference, conviction, and purchase (Clow & Baack, 2007). 8. Communication and Information Technology (CIT) Communication and Information Technology (CIT) has shown substantial effects on business world especially with respect to the international networks of multinational companies (Gould, Grein, & Lerman, 1999; Kitchen & Schultz, 2003). It has been considered as one of the major developments of communication of the last phase of the 20th century (Kitchen & Schultz, 1999, p.34) and thus TUI claims it as the key competitive advantage of their marketing strategies. Duncan (2005) defines the terms CIT as a “collective term for all the various types of planned messages used to build a brand, marketing communication integrates advertising, public relations, sales promotion, direct marketing, personal selling, packaging, events and sponsorships, and customer service”. Besides application of CIT related to consumers, most of the authors agree that it has significant application to target non-consumer stakeholders as well like employers, investors, and regulators. The corporate communication and CIT has substantial implications for the cost-effectiveness of TUI. Corporate communication targets the stakeholders by applying advertising campaigns, financial relations, and by offering corporate sponsorships, while non-customer stakeholders are targeted to brief them about the reputation of TUI through advice and counsel by senior executives. Communication and information technology is changing radically throughout the world. This radically changing environment in terms of media explosion, advancement in mode of communication and technology, disintegration of audience, globalization, consumer empowerment, more desire for accountability options and several more factors have improved the growth and emergence of communication and information technology (Semenik 2002, Kotler et al. 2005). The strategic communication plan varies from experts to experts as each one has its own way; however, Rowley (1998) suggested several stages which include identifying the target audience, determining communication objectives, designing the message, selecting the communication channels, establishing the promotional budget, deciding the promotion mix, and measuring results. Top level managers of TUI will present five basic steps model for the promotion of products or services which include assessment of marketing communication opportunities, analysis of marketing communication resources, setting of marketing communication objectives, developing and evaluation of alternate options, and assigning of specific marketing communication projects. Additionally, TUI will use some other most important communication tools of CIT i.e. advertising, direct marketing, personal selling, public relations, and sales promotions. Advertising might be actually a paid form of a non-personal presentation or promotion of ideas, goods, or services of TUI. It is a dynamic and growing part facing numerous challenges from competitive scientific world. Therefore new means of evaluation require a general contribution towards the general efficacy of its communication. TUI will use direct mails, outdoor posters, radio, television, magazines, and daily newspapers as the most common sources of advertising. This can be implemented by using different types of incentives, values, and distributions. TUI can implement this option because it is the most common step used by multinational companies to expand their area of operations effectively. There are number of methods and measurements which can be commonly applied by TUI to evaluate the sales promotions. The foremost step is the collection of information of the customers and the analysis of financial data. Several related actions of this segment will also be influenced like comparison of the pre-promotion period, promotion period, and the post-promotion period, analysis of sales data, market capitalization, penetration rate in consumer markets, repeat purchases, and effects of geographical locations etc. Conducting of public surveys will provide an idea to TUI’s managers to know the consumer behavior, their trends and intentions, and effects of promotion campaigns on its image. Globalization of TUI will directly impact the direct marketing which is one of the most valuable communication tools because its effectiveness can be simply measured. Marketing Public Relations (MPR) are used to improve and manage the relationships with general public which include customers, stock holders, community, government, and news media. TUI has to emphasize on this strategy a lot because it enjoys its high credibility and less dependency on sponsorships. This element of CIT is quite flexible, focused, and often produces effective results for TUI, however, like advertising; it also has some lags between the actual sales and marketing public relations. 9. Risk Management All that is considered as risk which create threats to the performance and output of an entity, a family or an organization to survive and grow up (Hillson and Murray-Webster, 2007). Risk management is an organized and constant discipline through which individuals, families, and government as well as private organizations discover, evaluate and manage risk (Flanagan and Norman 1993). Risk management enables TUI and its employees to cope up with improbability and provides a skeleton to recognize the risks and to counter it. Since all risks are different in their nature, therefore one cannot give the same weightage to all. This is just the risk management that helps the managers of tourism industry how much attention is required by a particular threat or risk. 9.1 Staff Risks Tourism industry is highly entertained by restaurants and restaurant management is considered as one of the most challenging and demanding business functions of this industry. In current scenario when the world is facing war against terrorism and crime activities are also on peak, the internationalization of TUI has forced its human resource managers to put special emphasis on the recruitment policies of their organization. 9.1.1 Fire A slight laziness or casual attitude of an employee may not only adversely affect the reputation of TUI but it may lead to serious damage of property and human loss. The restaurant business is always vulnerable to fire hazards. Kitchen and electricity staff is mainly responsible to this occurrence. Therefore, TUI has to modify its standard operating procedures related to fire hazards. 9.1.2 Terrorism In present scenario, managers take the measures against any terrorist activity very seriously. The proposed network of TUI can also be target of terrorists because any terrorist can accomplish any malevolent task in the disguise of staff, therefore, globalisation strategy of the organization will make the HRM department more careful in recruiting the staff outside the country. 9.1.3 Healthy and Hygenic Environment Since TUI is mainly a tourism and shipping agency, therefore, the reputation of its new restaurants and fast food outlets will largely depend on its food and health protective measures. The main priority of customer is always good quality of food and the environment where it is served. Pollution and cigrette free environment with tasty and regularly laboratory checked food will guarantee the success of new restaurant. Therfore, gastronomic department will be required to maintain the freshness, consistency, and cleanliness of food items. 9.2 Environmental Risks Environmental and sustainable restrictions from the government departments will also exert extra burden on TUI to meet the challenges of globalization. After the rising voice of global warming throughout the world, restaurants and hotel industries are specifically under pressure. This will force the marketing department of TUI to induct modern technology on its inventory to maintain the health and hygienic standards. In order to control the human and other waste, installation of appropriate treatment plant will boost up the impact of TUI’S restaurants in the competitive market of UK and Greece. Conclusion During the last two decades, the business world has observed tremendous emergence in many parts of the world. Along with the substantial growth, the rapidly changing factors like new media, consumer behavior, consumer empowerment, war against terrorism, and global recession has forced the international companies to seek new emerging markets for their survival. Strategic assets, competitive capabilities, highly professional human resource, and physical influence are critical and obligatory elements for a company to venture into international markets (Bradly, 2005). The entry mode of a company largely depends on the expected ease and difficulty levels which the company likely to encounter (Gannon, 1995). Naturally, TUI has to face cultural differences against its long-term strategic objectives of controlling and building the tourism industry through its brand image and services. The new operational environment, globalization challenges, and worldwide political and financial consequences will obviously change the working styles of business functions of TUI. Environmental disasters, natural calamities, and global climate change also impact on functioning of TUI. Certainly, the different segments of the company and their functioning will be affected by internationalization as the hotel and shipping operations are directly affected by any natural calamity while the travelling, tourism, gastronomy, and hospitality operations are influenced by global climate change, extreme heat waves, deforestation, and economic downfall in the world. Human resource management will also be mainly affected by cross-cultural communication problems. Bibliography Ball, D.A., McCulloch, Jr., W.H. Frantz, P.L., & Minor, M.S. (2006). International Business: the challenges of global competition. 10th edition, New York: McGraw-Hill Irwin p. 546 Bohdanowicz, J., and Clamp, L. (1994). Fashion Marketing, Routledge London Bradly, F. (2005). International Marketing Strategy 5th edition, Harlow UK, FT Prentice Hall Clow, K. E. and Baack, D. (2007). 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Product and Brand: Critical Success Factors in the Internationalization of a Fashion Retailer, Journal of Retail & Distribution Management, Vol. 33 No. 7 Read More