Why Tourism Industries Fail (Part 1)
April 2005
(Part two appears in the May 2005 issue)
Much of the tourism literature is dedicated to tourism successes or how to succeed. Rarely do we examine our failures. However the fact is that many tourism and travel businesses do not succeed. The reasons for these failures may be of a personal nature, not enough passion or pure laziness, but the great majority of failures can be classified into sociological taxonomies. These categories help us to think about what we may be doing wrong and then correct these mistakes before they cause a failure. The following then is a number of things to avoid or to do in order to keep bankruptcy far from your door.
- List the reasons for potential failure. For example, you may want to consider that tourism/travel industries tend to fail due to their inability to change or their lack of understanding that they need to change. Another reason for failure may be that the tourism bureaucracy simply dug in its heels and indicated a remarkable inability to change with the situation and customers needs. Some of the major airlines are examples of this inability to see the need for change due to a set business model. Another change mistake may occur when leadership produces only minor changes instead of a total overhaul of the system. Often these cosmetic changes are symbolized by scapegoating the head of a CVB or tourism office rather than in-depth problem analysis. Still another reason for tourism business failure is that often the people who are supposed to be making the change do not believe in the change. Thus either the new program is never fully understood by employees or after a short amount of time employees figure out a way to return to their old ways though expressed in new terms.
- Ask if failure occurred due to lack of good data concerning the existing situation. Because a business may have a shallow understanding of its current situation or has done poor research, it may allow itself to be caught from behind, taken over by more in-tune competitor or simply become irrelevant to the marketplace. Often tourism officials are so enamored by data that they over-collect data. This over abundance of data can mean that important data are lost in a fog of data. Failure to integrate analysis into the work place means that data collection was counterproductive. Data not used is simply time and money wasted. It often leads to analysis by paralysis in which in the end nothing is ever accomplished.
- When a tourism business lacks core values it has a higher probability of failure. Among these may be the business’ or business’ leadership’s ability to express itself to its constituency, lack of vision, lack of leadership, poor measurement techniques, poor marketing, and the recycling of old ideas rather than creatively developing new ideas.
- Failures may occur when tourism leadership fails to provide people, both employees and clients, with a meaningful experience. Employees do a better job when they believe in your product and when they understand the direction in which their manager is leading them. That policy does not mean however that every decision needs a group decision. In the end, the companies are more similar families than to democracies, and that means that leadership needs to maintain a careful balance between listening and teaching and making the final decisions.
- Failures often take place when there are no core questions for improvement. Every part of the tourism industry needs to ask itself, what its mission is, how it differs from the competition, how it can improve, where its weakness are, and how it measures success. Many tourism products that fail, be they in the lodging industry or in the attractions industry, simply fail to ask these essential questions.
- Failure and bankruptcies often occur due to lack of quality of service and product. All too often tourism providers go for the immediate profit rather than consistency. Once customers get used to a certain standard, it is hard to cutback on service, quantities or quality. For example, a restaurant that provides irregular service will have a high probability of losing its clientele. In a like manner, the airline industry has produced a great amount of resentment by lowering its standard of service, and reducing its in-flight amenities.
- More and more tourism failures will come about because tourism leaders failed to see security as a means to increase the bottom line rather than simply another expense. The 21st century is one in which good marketing will include good security and safety as a part of customer service. Those places that seek profit over tourism surety (safety and security) will in the end self-destruct. Tourism surety is no longer a luxury but rather it ought to be a part of every tourism entity’s basic marketing plan.
- Businesses whose leaders lack passion in the end tend to fail. Tourism is a people’s industry. If its employees or owners do not see their work as a vocation rather than simply a job, then they produce a lack of passion and commitment that destroys customer loyalty and in the end destroys the business. People who do not like people should simply not be in the tourism/travel industry.
