Travel Reference
In-Depth Information
in Malaysian hotel organizations
H.M. Said & R.A. Latif
UNITAR International University, Selangor, Malaysia
N.K. Ishak
City University College, Selangor, Malaysia
ABSTRACT: Environmental Scanning is the acquisition and use of information about events or trends
in an organizations external environment, the knowledge of which would assist management in planning
for the organization next course of action. Environmental Scanning or known as ES is necessary for
every organization yet this task is very difficult to conduct. Environment uncertainty is a key issue for
strategic decision makers to manage continuously in a competitive market. It is seen as a threat more than
an opportunity to some industries. Previous studies show that there are significant relationship between
scanning the environment, strategic response and organizational performance. Changes in the environ-
ment had in the past effected on how organization conduct its businesses, thus have impact on their per-
formance. Reports from the literature show that organizations do conduct some practice of ES on their
business environment; some are informal while others are formal. For that reasons, organization needs
to implement a systematic ES as part of its corporate planning activities. How well the organization use
information from ES is also another key area to competitive advantage. How organizations organizes the
scanning effort so that information to specific situations can be more readily available. Having objective
information is crucial for organization's survival in the industry. The purpose of this paper is to discuss
conceptually on how organization conduct ES. It will discuss the significant strategic information models
in the literature to address the importance of obtaining information for decision making.
Keywords
: Environmental scanning practices, external environment, strategic information scanning sys-
tem, organizational competitiveness, Malaysian hotels
1 INTRODUCTION
customers, competition, technological, regulatory,
economy and socio cultural (Daft, et al., 1988).
Scanning is a process of identifying, monitor-
ing and evaluating major environmental changes in
the industry (Fahey & King, 1977). The purpose
of scanning is to develop broad strategies and
long term policies based on information that has
been gathered and interpreted from the environ-
ment. The content of scanning can be considered
in terms of the scope (general or specific environ-
ment), range (geographical), source (magazines,
trade exhibitions) and futurity (5 years, 10 years)
(Thomas, 1980).
ES is also seen as a systematic process to col-
lect information, interpret trends and events and
provide feasible courses of action (Zhao & Merna,
1992). In short, ES can be defined as an approach
to gathering relevant information from the external
environment and converting the information into a
meaningful knowledge for the executives to use in
managing their organizations.
1.1
Background of the study
Customer spending on tourism and hotel sector is
closely related to the economic cycle. Spending on
leisure activities such as travel and lodging tends to
be one of the first things that consumers hold back
in times of economic hardship. The travel and hotel
industry is further affected by reduced demand from
business sector due to critical incidents, economic
crisis, technology advancement, political regulations
and other changing external environment. Luxury
hotels are among the most affected sector whereby
hotel will experience reduced occupancy, reduced
room rates, access rooms, and high operating cost.
The impact is very much related to the envi-
ronment around the organization. Environment
is viewed as a source of information, continually
creating signals and message that organizations
should attend to (Dill, 1962; Weick, 1979). The
external business environment can be defined as
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