Sustainability: A Barrier to Tourism Development? - Tourism and Development: Concepts and Issues - page 448

• Environmental capital: the environmental capital of destinations is defined

broadly to include both the natural environment (that is, natural capital:
resources, sinks and processes) and the built environment (facilities,
attractions and infrastructure).

• Financial capital: the availability of financial capital (private and public

sector) within destination economies determines the extent to which other
capitals may be owned, developed and traded.

• Political capital: although a subset of social capital, the type and extent

of political capital possessed by a destination determines its power-
relationship with external actors and, hence, its ability to self-deter-
mine its tourism development.

• Technological capital: tourism markets (the supply-demand interface) are

increasingly dependent upon information and communication technol-
ogy. Access to, ownership of and skill in the use of such technology is a
key destination capital.

What these capitals represent are a set of assets that a destination, like any
business that seeks to make a profit through the exploitation of capital, can
draw on in the pursuit of 'profit', or developmental benefits. That is, destina-
tions are in the business of tourism; they seek to generate benefits from pro-
ducing and selling tourism products and services, the potential returns or
'profit' being income, employment and economic growth. However, 'develop-
ment' is not an inevitable outcome of tourism; the extent to which the eco-
nomic returns from tourism translate into wider development is dependent
on a variety of local factors. Thus, in order to optimise those benefits, it is
necessary, in turn, to make the most appropriate use of capitals to compete
effectively in tourism markets whilst meeting local needs.
Putting it another way, a tourism destination may be thought of, some-
what simplistically, as a sort of business or, more precisely, as a corporation
comprising numerous business units. In other words, all the facilities, attrac-
tions and other organisations that collectively supply tourist services and
experiences in the destination are, in a sense, different divisions within the
overall destination business. There are, of course, significant differences bet-
ween destinations and corporations, not least that, generally, there is no
formal organisational structure, chain of command or common ownership
within a destination. Nevertheless, corporations (including those in the travel
and tourism sector) typically follow a strategic management process that
seeks to achieve 'fit' between their resources and the external environment
in order to remain competitive and profitable.
In simple terms, organisations typically undertake an internal audit of
their resources, capabilities, knowledge and core competencies, plus an exter-
nal analysis of the competitive environment, as a basis for establishing their
strategic direction (Evans et al. , 2003). In the following model, a similar pro-
cess is proposed with, in particular, the analysis of destination capitals