(a) SWOT Analysis
SWOT stands for Strengths, Weaknesses, Opportunities, and Threats. It is a strategic planning tool used by businesses to assess internal and external factors that can influence their success. In tourism, a resort may analyze its strengths (location), weaknesses (limited staff), opportunities (growing eco-tourism), and threats (seasonal demand). This helps in strategic decision-making and resource optimization.
(b) Fixed & Variable Cost
Fixed Costs are expenses that do not change with the level of output, such as rent, salaries, or insurance. For a hotel, the rent remains constant regardless of how many rooms are occupied. Variable Costs fluctuate with the level of production or activity. For example, food and laundry services increase as more guests check in. Understanding these costs helps in pricing and profitability analysis.
(c) Budgetary Control
Budgetary control is the process of preparing budgets, comparing actual performance with the budgeted figures, and taking corrective actions. In the tourism industry, it ensures financial discipline and guides decision-making. For example, a travel agency may set a budget for marketing. If actual spending exceeds the budget, managers analyze the cause and adjust future plans accordingly.
(d) Steps in Decision Making
- Identifying the Problem: Recognize the issue that needs resolution.
- Gathering Information: Collect relevant data and insights.
- Identifying Alternatives: List all possible options.
- Evaluating Alternatives: Assess the pros and cons of each option.
- Selecting the Best Option: Choose the most feasible solution.
- Implementing the Decision: Put the chosen alternative into action.
- Monitoring and Evaluation: Review the outcomes and make necessary adjustments.
This process ensures logical, informed, and strategic decisions in business operations, including tourism management.