Unit 2 – P2, P3, M1 & D1

write a report about organisational and financial characteristics in different organisations in the tourism industry and how companies gain competitive advantage and how organisations achieve business aims. 

Thomas Cook (India) 

Thomas Cook Group is a public Ltd company operating in the private sector. They are involved in inbound and domestic travel. Thomas cook is horizontal integrated and is controlled by a Board of trustees and shareholders. The documents they needed to set up the business were a certificate of incorporations, memorandum of association and an article of association and finally the liability is limited. They distribute the profits through dividends (a share of profits made as a cash payment to shareholders when a bonus is made through the company). If they need to make extra capital, they can use share capital which is the money raised by selling/ Releasing shares on the stock exchange. The purpose of the organisations is to provide package holidays for customers to enjoy and their financial accountability is from the customers and shareholders.

Competitive advantage – An advantage gained over competitors by giving better value to consumer so that they choose your product and not theirs.


The methods they have used to gain competitive advantage is by Thomas cook (India) recently become merged with a vacation ownership company which is Sterling Holidays who have 16 destinations in India, this aim then allows them to have competitive advantage over companies as it has access to 19 sterling resorts so customers now have a wider range to choose from when booking their holiday. They achieved their aim by setting a time target on when the merge is finally going to close (Sometime in the last 3 months of 2014). The types of competitive advantage they now have are: Added value, providing new innovative products/services, excellent customer service, advertising and promotion, locational advantage and integration.

Added value – more kinds of resorts for customers to choose where they want to stay whilst on holiday (family only, adults only)
Providing new innovative products/services – in the future building 15 more sites to add new resorts for customers to enjoy
Excellent customer service – adding extras to its product (“making sure the resorts are in well located, full-service, quality resorts to offer great holiday experiences”)
Advertising and promotion – allowing customers to know there is now more places to stay in India via the news (on TV or online)
Locational advantage – having many travel agencies in high streets to people can book holidays and the resorts to be well located in India

Integration – Thomas Cook is now horizontally integrated as it has brought a hotel/resort chain
 


Ryanair
Ryan air is in the private sector operating as a public Ltd company. They are involved with inbound, outbound and domestic tourism. Ryan air is horizontal integrated and is controlled by a Board of trustees and shareholders. The documents they needed to set up the business were a certificate of incorporations, memorandum of association and an article of association and finally the liability is limited. Profits are distributed through dividends (a share of profits made as a cash payment to shareholders when a bonus is made from the company).When Ryan Air need to make extra capital, they can use share capital which is the money raised by selling/ Releasing shares on the stock exchange. The purpose of the organisations is to provide package holidays for customers to enjoy and their financial accountability is from the customers and shareholders.

The methods and opportunities Ryan air used are launching a business service and to buy Cyprus Airways. The aim is to revamp its image and to catch up with the new traveller demands and giving customers a better treatment in flight. The types of competitive advantage they now have are: Added value, providing new innovative products/services, excellent customer service, advertising and promotion, TQM, modern sales techniques, locational advantage, innovative pricing and integration.

Added value – customers can now choose to travel business class (meaning there will be more check-in baggage, flexible tickets and premium seats)
Providing new innovative products/services – Ryan air has introduced allocated seating, has relaxed the hand luggage restrictions, reduced charges and looser booking conditions
Excellent customer service – improving all standards so customers  are no longer receiving bad service
Advertising and promotion – Ryan Air are promoting their organisation by flying into more city-centre airports and make it easier for firms to book tickets for their employees, Ryan Air has also launched its summer 2015 schedule from London Stansted three months earlier than the year before
TQM – Total quality management  is when the products already used are just improved to a higher standard as the tourism industry and what customers require is  ever changing
Modern sales techniques  – having USB chargers on new planes allowing people to charge electrical devices and announced three new routes
Locational  advantage – Ryan air is now flying into Cologne, Edinburgh and Glasgow, now they have brought Cyprus Airways they now have access to sell flights to Dubai, Abu Dhabi, Oman, Israel, Cyprus and Russia
Innovative pricing – they have new fares starting at £59.99 to gain more business customers
Integration – Ryan Air is now horizontally integrated as it has brought a little competition business  to fight

Comparison and contrast 

The financial characteristics of Thomas Cook (India) and Ryan Air are similar as they both are a public Ltd company and shares their profits made through dividends to their shareholders, as they are on the stock exchange  market they raise extra capital by releasing more shares on to the market. The comparison of organisational characteristics is that Thomas Cook (India) is offering customers various choices of new resorts in India whereas Ryan air is an airline offering flights to places in Europe and for business customers. However the differences between the two organisations is that Thomas Cook (India) merged with the vacation ownership company to have more competitive advantage and Ryan air brought Cyrus airs outright to eliminate competition to have more competitive advantage to compete with their rival which is Easy Jet.
Both organisations have used many methods to gain competitive advantage, these are: Added value, providing new innovative products/services, excellent customer service, advertising and promotion, TQM, modern sales techniques, locational advantage, innovative pricing and integration.


Added value – having various levels of a product (First class, Business class, Premium economy and economy)
Providing new innovative products/services – Adding new routes/ hotel resorts 
Excellent customer service – offering new products will make the customers enjoy their holidays more
Advertising and promotion – announcing the merge/buying out a business via some form will get the customers attention and book with the company (Thomas Cook India and Ryan Air)
TQM – announcing new products/services allowing customers to enjoy them
Modern sale techniques – producing products/services which customers require and demand
Locational advantage – being close to places for customers to book holidays and flights (shops and online)
Innovative pricing – having lower prices or deals which will attract the customer to the tourism businessIntegration – by being horizontally integrated (both tourism organisations) they can help eliminate competition   

Evaluation

To conclude, both of the tourism organisations (Thomas Cook India and Ryan air) have different types of methods and aims for their businesses to get more customers, whether it be merging with a company or buying one out, as long as it gets more customers and a higher amount of competitive advantage over another company in the tourism industry. All tourism organisations are always fighting for a bigger competitive advantage and a bigger market share.