Analysing And Identifying Key External Influences Essay

The purpose of this study will foremost analyze and place any external influences within the administrations macro-environment utilizing a PESTEL analysis. Second, to analyze the strategic capableness of the company a SWOT analysis will be used. Third, the culture/values of Travcom will be identified and perceived sing the norm within a on the job concern. Finally, an penetration into Travcom ‘s stakeholders will be looked at.

The construction of the undermentioned study will utilize a theoretical attack to explicate relevant theory and theoretician every bit good as so using those methods/tools to HSBC to show an apprehension of the conceptual methods analyzing, reviewing and measuring them.

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TravCom is involved within the travel industry developing cost effectual, taking border accounting systems. Their services are used by over 3000 travel bureaus across the universe.

External Influences

By utilizing the PESTEL model we can analyze the many different factors in a house ‘s macro environment that will impact the determinations of the administration. PESTEL displays political, societal, technological, legal and environmental factors. Using this method can assist place the market place.

To measure the industry and market environment, set uping what affects TravCom when come ining the market. A simplistic attack measuring the concern environment is split into two chief subdivisions that are macro and micro environment. PESTEL displays political, societal, technological, legal and environmental factors. Another method of analysis is an attack developed by Michael E. Porter called the five forces analysis ( Grant 2005 ) . Porter ‘s five forces theoretical account is a widely used theoretical account to measure the industry environment. This theoretical account is utile as it examines the relationship with five of import countries.

Exhibit 1.1 – The Market Enviroment


Porter ‘s five forces attack

TravCom will be looking at the political deductions that will impact them as a travel company such as the proposed EU GDS deregulating Torahs and air hose TMA ‘s. This could take to decreased net income borders due to the possible soaking up of the new airline/GDS charges. The planetary travel industry has reported steady economic growing in their last five old ages which goes to corroborate that the industry is traveling forwards even after 9/11. No alteration in societal factors seems to hold any impact on TravCom whatsoever. The usage of cyberspace may hold an inauspicious affect on the administration as figures indicate that the usage of travel agents for booking concern travel is down from 31 % to 28 % in the last twelvemonth. However, the continual usage of TMC to capture non-core GDS reserves is still turning, so the impact of these findings may non be every bit terrible as first indicated. TravCom need to look into if corporate societal duty is critical for a long term stage. Will future Government action force them to cipher their C footmark and if so, will they be able to scrutinize this information? They may besides necessitate to look into mensurating C emanations and making studies on them from a client position.

Exhibit 1.2 – Porter ‘s Five Forces Model

Substitute Merchandises

– Limited distribution theoretical accounts:


– G2 Switchworks

– Farelogix


– Saber

– Galileo

– Amadeus

– Worldspan

Potential Entrants

– No possible new possible entrants.

Rivals within the industry

– Foreman

– Discovery

– Tramway

– tMaster


– clients ( small-medium sized houses every bit good as those larger than this ) .


Analyzing Exhibit 1.2, this theoretical account allows us to see what potentially affects the industry environment that will impact TravCom. First, examing the purchasers ( clients ) , there are presently no clients on any price reduction agreement and neither is any client. No client has asked for price reduction either, as of yet. Research shows that there is no existent discounting enterprise within the market, although this can non be for certain. Future price reduction petitions, if offered, will necessitate to be structured right and made sure that an unhealthy sum of bottom line net income is n’t extracted. With respects to providers, there is the possibility of being able to utilize the buying power of clients to acquire in contact with accessory providers ( for e.g. office supplies ) .

Examing possible entrants and replacement merchandises, TravCom do non truly face an issue with new entrants as they will hold to utilize the same information construction that is presently being utilised by all other providers. New limited distribution theoretical accounts have besides been introduced which are still in their babyhood and non likely to be taken up by the metameric market within the following three old ages.

TravCom have assorted rivals that offer similar services as they do, but there are four major rivals that the company deals with ( BOSS, Discovery, TRAMS, tMaster ). Travcom trades with this by positioning their merchandises at low-cost monetary values in the market.

Selling Analysis

SWOT shows Strengths, weaknesses, chances and menaces. As described by Johnson ( 1998 ) , SWOT analysis summarises cardinal issues of the concern environment. Strategic capablenesss of an administration can be assessed to see how this can impact the strategic development.

SWOT Analysis


Strong planetary presence. This offers important economic systems of graduated table and helps to distribute hazard.

Has a strong being in energetic markets, seting it in an first-class place to take advantage of future growing in those economic systems.

Strong and experient direction squad which in bend provides a good tally concern and ability to accommodate to market alterations quickly.


TravCom are non advancing a full merchandise scope to all sections. Therefore they are losing out on valuable gross revenues chances.

The company has a heavy trust on TravCom CS systems for gross. This can be perceived negatively as there is a demand to keep and increase market portion of TravCom CS whilst increasing gross revenues in other TravCom merchandises to cut down to reliance.


The administrations strong place presents the chance to surpass rivals during the economic downswing. This will let them to construct a repute for being one of the safer Bankss for depositors, assisting to increase resources for loaning.

Identify new concern spouses leting extra gross watercourse and gross revenues channels.

There is a continued growing in the planetary travel industry across all sections. TravCom should look to aim other sections such as MICE.


The intercession of GDS BOS could aim the clients of TravCom

The usage of online corporate TMC ‘s gaining controls clients from traditional TMC ‘s ( i.e. TravCom clients )

Datas may non get from normal channels and may necessitate new gaining control processes due to atomization of the traditional engagement procedure.

Boston Matrix

Exhibit 1.3 – Boston Matrix

Cash Cow – TravCom CS. This requires small investing as it has generated high net incomes for TravCom, which can be used to put in other sectors of the company. Because the market has a low growing rate it will necessitate small capital and the net consequence is a positive hard currency flow.

Star – HMPR proof GIDS. These have competitory places in high growing markets but will give high hard currency returns.

Problem kid ( Question grade ) – Quotation mark works Integration. These have a low market portion in a fast turning market.

Dog – no Canis familiariss have been identified within TravCom

Sensed Culture

The civilization within any administration usally follows a certain norm and tendency. All concerns have a set of values that their employees must follow in order to run a successful administration. It can be perceived that TravCom follow the undermentioned competences: treating clients reasonably, presenting quality consequences, following processs and taking ownership and demoing inaugural. These are all values that employees must follow to guarantee the concern runs at an optimal degree to make maximal net incomes. Equally good as being able to follow these competences, an employee must be persuasive, communicational, organizational and an overall confident person.

To handle clients reasonably, the employee must understand, regard and run into the demands of TravCom ‘s diverse work force and clients. They will besides necessitate to understand the demand to dispute discriminatory, unequal or unjust behaviors and act within the rules of equality and inclusion. With respects to following processs, TravCom likely have a set of well-thought-of rigorous company guidelines such as workplace safety and passionate client attention.


A stakeholder is an person or an administration which has an involvement in a concern and can be affected by the manner it runs. They can have a portion in the concern, work within it or hold a fiscal relationship with it.

Exhibit 1.4 – TravCom Stakeholders


– TravCom is assisting the community by mensurating C emanations and making studies on them from a client position.


– Ratess of wage

– Occupation security

– Compensation

– Respect

– Communication


– Galileo Global Distribution System


– Hectometer gross and imposts

– Inland gross



– Travel agents

– Tour operators

– Mouse

– Home workers

– Cruise operators

– Railing

– Hotel


– Saber

– Galileo

– Amadeus

– Worldspan


TravCom ‘s attack to deriving a competitory advantage in the market and so prolonging it is really successful. The usage of their capablenesss such as their cognition and invention stemming from technological promotions in their merchandises has been successful. Their accomplishment has allowed them to put the benchmark, go forthing other companies to happen it hard to copy specializer cognition tied with the connexions within Travcom and their civilization.


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