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Introduction to Managing Innovations
Managing innovation is referred to as the management of the innovation processes. It can include both in the product as well as organizational innovation. Innovation management involves set tools that provides opportunity to the business in cooperating with common understanding relating to the processes as well as goals. In the present study management of innovation has been discussed with respect to tour operator firm that is Thomas Cook.
The company is leading integrated travel company that offers wide spectrum of services that desires to visit the different countries across the globe. The present report entails to understand the innovation history of the firm and its existing innovation performance as well as capabilities.
The Organization and Industry Overview
Organization and Its Innovation History
Thomas cook group is a British global travel company listed on London stock exchange and business was formed in the year 2007 by merger of Thomas cook AG. This group owns large number of tour operators along with the charter airline based in United Kingdom. At present business has employed 21,813 employees and has revenue of £7,834 million. Services offered by organization are famous worldwide where every service matches with the requirement of target market. Further, the range of products offered by company involves charter and scheduled passenger airline, package holidays, cruise lines, hotel and resorts (History – Thomas Cook, 2016).
Advanced tools have been employed by organization for serving its customers and due to this reason customer base of organization is quite strong. Moreover, Thomas cook operates in main five divisions which involve central Europe, UK, German airlines, west Europe and northern Europe. Organization is main sponsor of Manchester city and Peterborough United football clubs. With the introduction of new and advanced technology in the field of tour operator company has enhanced its market share and holds capability to introduce new type of services in the market. Apart from this, competition level is quite high due to which company relies on innovative practices so that long term benefits can be obtained easily.
Thomas cook introduced its leisure trips in the summer of 1841 and during the next three summers company arranged succession of trips where main target was on midland towns of Leicester, Derby, Nottingham and Birmingham. As the time passed business added more destinations and at present organization is regarded as second largest European travel company. Thomas cook has 33 tour operating brand with 2400 travel agencies and 66 aircraft. Business is having 50:50 owned by German retail group. Organization has introduced interactive and innovative tablet application so that sales volume of business can be enhanced easily.
Further, the entire tour operation market has been changed where in past online systems were not present and at present all the operations are carried out through IT systems. Online booking system has been employed and all the kind of payments are done with the help of electronic systems. Through this, Thomas cook has strengthened its relationship with those of its suppliers through presence of effective payment system (Ronningen, 2010). Moreover, suppliers are granted proper credit period as expected by them and due to this reason Thomas cook is able to offer services to its target market on time and as per requirement of target market.
Internet technology has reduced the time frame which is required in transferring payment and it has brought fruitful results for business in every possible manner. Apart from this, both company and its suppliers can understand each other requirement. This has directly lead to rise in profitability level of the business and the most effective areas have been identified where costs can be reduced upto extent. Due to this reason services of Thomas cook are worldwide famous and majority of the customers are brand loyalty.
Innovation has allowed to serve stakeholders of business in better manner and has supported to grab opportunities present in the business environment.
Organizations Existing Innovation Performance and Capabilities
A very instrumental role is played by the tour operators in determining the manner in which tourism industry is functioning. The services provided by Thomas Cook in the present competitive market of tourism is highly commendable and can be credited as innovative in a true sense.
In its initiative to maintain its competitive edge in the market, the management of the company has constantly produced innovative and creative ideas which has been attracting the attention of the customers all over the world. It has also been considered as a leading integrated travel company as it is providing services related to foreign exchange, visas and passport, insurance and so on.
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In addition to being an integrated service provider, it can also be considered very innovative and technologically advanced in its practices and policies. One such service which the company has been providing is that of a unique application which provides all the facilities in relation to tourism (Andrea, 2012). This application is completely customer - centric and can also be termed as path breaking move for the sales team of the enterprise. It is an influential amalgamation of various available travel packages, vibrant images and maps of various destinations, advice in relation to travel and many such services which personally cater to the needs of every traveller.
One of the most attractive feature of this application is that it offers a virtual walk through all the destinations which are planned in the itinerary so made in the application. In addition, the option to make comparisons between various holiday packages with different itineraries are also provided to the customers. This has completely revolutionized the process which was traditionally undertaken by the travelers to plan their trips and making the suitable bookings. In essence, the a large enhancement has been brought about in the research which is required to be done by the travelers and also the booking experience.
In order to maintain the quality of services being provided through this application, the content and information available in various sections has been extracted from authentic sources and are also updated on a regular manner. Another manner in which it is practicing innovations is by offering special offers to the customers through the app and otherwise. These exciting offers are displayed to the customers in the most attractive fashion (Innovating change at Thomas Cook, 2010).
Another important initiative which has been introduced by the company is that of encouraging and following the practice of responsible tourism. In its drive to become responsible, all its tours are planned and managed so as to reduce the negative impact of tourism on the local communities and the places which are visited by them. In addition, the introduction of the eco - friendly application has furthered its initiative to become responsible by eliminating the usage of voluminous brochures which sought to reduce the footprint of the company on the environment.
Along with benefiting the environment, the business of Thomas Cook has also experienced a great response. The rationale behind this trend could be the increasing awareness among the people who are preferring to opt for Thomas Cook, owing to their responsible nature. Hence, this in a way has become a selling point for the company. Also, the responsible behaviour of not exploiting the local communities, resources, heritage and so on has attracted the attention of locals of various destinations, which have also started giving preferential treatment to the company. This in turn has conferred financial benefits to the company, along with an upliftment in the brand name (Hjalager, 2010).
Another practice which requires a mention is that of contributing to the economy of the locals by providing them employment, planning the travelers stay at local accommodation and so on. In consequence to this, the travelers are enabled to receive an experience of the local life which further enhances the quality of their stay at each of the destinations. This has further increased the popularity of Thomas Cook among the adventurous travelers.
An important innovation which has been introduced by Thomas Cook and also by various leading tour operators of the nation, is that related to payments. Traditionally the payment system was not customer friendly and used to be via money transfer bank or other means. However, with all the technological advancement in various industries, Thomas Cook has also partnered with Wex, which is a leading service provider of virtual payment solutions.
With the assistance of this association, an integrated payment system has been introduced to the customers of Thomas Cook. This has further enabled the company to provide a seamless end-to end payment service to the customers, thereby, enhancing their relation with the customers as well as the suppliers.
The Industry in 2016
The travel and tourism sector is becoming one the largest as well as fastest growing economic sectors across the world. It has greater contribution to the global Gross Domestic Product. Further the employment has increased multi-fold. The travel industry in going through various innovation in the year 2016. This are relating with online travel sector. The tourism sector has evolved drastically over the past decades. In the modern era each person is online and phenomenal adoptions are being made by the tour operators such as Thomas Cook in technology in order to transform themselves within the sector.
Cloud computing is regarded as one of the natural evolution within the industry along with cloud servers that are physically located he country. Another major innovation that is being made is in relation with the social media marketing. This has been considered one of the best way to reach the public in an effective manner. The firms are taking recommendations as well as carrying out campaigns in relation with the social media for the purpose of developing rapport with the audience and widen their reach.
Another aspect under this is mobile innovation which is key of tour and travel sector. The companies under travel and tourism sector on continuous basis are looking at innovative ways of establishing interaction with the people by the means of their personal devices. Mobile has become the most preferable choice of the customers that assist in accessing the online travel services (Ellis, Henke and Kull, 2012). Further it would dominate the invention as well as transaction space in the year 2016. It is offering medium for online travel businesses to develop the services and engage with the customers. This has never been the scenario of the industry which exists at present.
Development of integrated technology platform assist in offering value to the users at every stage of their journey. The innovation is not just upto convenient booking as well as ticketing but it is moving more in the direction of offering greater travel experience, that is requires for solving issues in each and every stage of travel experience. The means of payment has been made much simpler that would increase the convenience of the customers to a greater extent. The industry in 2016 would see drastic changes which would be beneficial in terms that it will assist the organizations in providing best travel experience and more comfort.
The development of online applications of the organization would offer great deal of convenience to the customers as they book ticket and can get wide range of other services as well. In addition to this they can have a look at the image of the location where they are planning to visit. This will develop a sense of trust among the customers with respect to the travel and tour operators such as Thomas Cook. Thus this compels the visitors in making purchase of the services on repeat basis.
It can be concluded from the study that travel and tourism sector is going through greater innovations from the past decades. There is drastic changes bought in the services offered by the companies which has offered greater convenience to the customers to a greater extent. It has been inferred from the report that with the technological innovation in this sector large number of customers are attracted towards experiencing the services which can acted as boon for the industry. The industry in 2016 would offer services of cloud computing, mobile application which would act as an aid in increasing interaction among both.
- Andrea, N. A. G. Y., 2012. A review of tourism and hospitality innovation research.Annals of Faculty of Economics.1(2). pp.364-370.
- Ellis, S. C., Henke, J. W. and Kull, T. J., 2012. The effect of buyer behaviors on preferred customer status and access to supplier technological innovation: An empirical study of supplier perceptions.Industrial Marketing Management. 41(8). pp.1259-1269.
- Hjalager, A. M., 2010. A review of innovation research in tourism.Tourism management.31(1). pp.1-12.
- Ronningen, M., 2010. Innovative Processes in a Nature‐Based Tourism Case: The Role of a Tour‐operator as the Driver of Innovation.Scandinavian Journal of Hospitality and Tourism.10(3). pp.190-206.