STRATEGIC MANAGEMENT AND STRATEGIC POSITIONING IN THE SITUATION OF CHANGING ENVIRONMENT RESEARCH ON STRUGA TOURIST REGION Arben Oda

Ph.D.1, Mitre Avramoski Ph.D.2

1 2

State University of Tetova, R. of Macedonia, arbenoda@hotmail.com Faculty of Tourism and Hospitality Ohrid, R. of Macedonia, mitre_avramoski@yahoo.com

Abstract In the situation of changing environment a proper strategic leadership is very important for successful market positioning of each holder of tourist offer especially tourist destination as a whole. In this paper are presented the results from the conducted research on the situation of strategic leadership on each hotel in Struga region and strategic management of Struga destination. Next to it are analysed all internal and external factors which determine the strategic management and strategic positioning. According the results from data analyses during the research we can conclude that there are a very small number of hotels in Struga region which have strategic plans to enter international tourist market and also noted that Struga is not practicing destination concept in managing tourist activities. Compared to that, the opportunity analyses indicates that Struga region contain all the essential features of one tourist resort, homogenous and functional space entity with rounded tourist offer, rich with specific attractions and receptive capacities. Struga region though has all needed resources to become attractive and successful destination, yet so far not succeeded to create a product to compete in a tourist market. Strategic aspects of managing is a unique concept of action that enables formulating a developing strategic directions and proper fit to all internal elements of hotel companies with external environment. Analysing strategic opportunities and the level of strategic behaviour of hotel companies in Struga region is a key point of this paper. At the same time we indicate possible strategic directions which are available to hotels in Struga region in order to gain competitive advantage in the tourist market. Key words: strategic management, strategic positioning, tourist market, changing environment. 1. INTRODUCTION

A fast and turbulent change in the environment needs a constant monitoring and proactive response of all businesses. This is even more emphasized in the field of tourism taking in account its features and specifications. Social and economic changes that have taken place as a result of industrial development have made various quantitative and qualitative socio-cultural, economical, structural and spatial changes in the demand, which had direct impact and changed the tourist offer. In such circumstances, strategic aspects of managing are unique business concept which will enable the formulation of strategic directions for development and proper fit of all internal elements of holders of tourist offer with the external environment Strategic alternatives on the other hand will provide successful market positioning and long-term compatibility
2. STRUGA IN THE TOURIST MARKET OF MACEDONIA

Struga region basically possesses all needed resources to become a successful and attractive tourist destination. But, despite this, it failed to create a competitive product in the tourist market till now. In this paper we are researching the situation with the strategic management at the main holders of tourist offer in Struga, such as hotel facilities. Also, we researched the degree of involvement of state officials, especially the local officials as well as the Agency for promotion and support of tourism in Republic of Macedonia. From 95 hotels in 1

R. Macedonia in 2011, Struga has 21 hotel or 22 % with 4009 beds. Otherwise, R. Macedonia has 11.307 beds in 2010 as the total number of hotel capacities. Part of hotel facilities in Struga, such as hotel Izgrev with 578 beds and hotel Skopje with 130 beds are ccontinuously or periodically out of order. Despite this it is evident that Struga possesses a significant number of hotels in R. Macedonia, and with a significant portion of total numbers of beds. However, if we compare the results achieved in tourism in Struga region with the other cities that have bigger portion of tourist market in R. Macedonia, we may note that by the total number of tourist Struga is significantly behind Ohrid and Skopje. Table 1. Number of tourists in Macedonia and bigger tourist centers in 2011.
total City No. of touris ts 165 209 126 327 5726 1 237 444 586 241 in % 28 ,18 21 ,55 9.7 7 40 ,50 100 ,00 stic No. of touri sts 105 313 15 962 4076 8 162 502 324 545 dome in % 3 2,45 4,92 12.5 6 5 0,07 10 0,00 No. of touri sts 59 896 110 365 1649 3 75 942 261 696 foreign in % 22, 89 42, 07 6.04 29, 00 100, 00

28% 40%

10% Ohrid Skopje

22% Struga Other

Table 2. Number of nights spent in Macedonia and bigger tourist centers in 2011.

Ohrid Skopje Struga Other Maced onia

Although Struga has 22 % of hotel capacities in Macedonia still makes only 9.77 % of total tourist market in Macedonia, wile Ohrid with 31 hotels makes 28,18 % of total tourist market. According the number of nights spent Struga is in the second place, immediately after Ohrid, although still very far behind. It is generally known that overall utilization of hotel capacities in Macedonia for one year is very low, only 12, 2 %. As for hotels in Struga, the research conducted during 2011 tried to detect some of those reasons and the level of strategic behaviour of hotel companies. . 3. STRATEGIC MANAGEMENT AND
STRATEGIC POSITIONING OF THE HOLDERS OF TOURIST OFFER IN STRUGA CURRENT SITUATION

Source. Statistical survey: transport, tourism and other services. State Statistical Office of Republic of Macedonia, Skopje, Jun.2011. Graph 1. Participation of individual cities in tourist market of Macedonia in 2010.

The research in all 21 hotels in Struga region as main holders of tourist offer shows that their business activities are in generally characterized with inadequate business policy. In this sense, it was found that they insufficiently apply the marketing concept in their business activities and barely do market research, which is a key factor to create a proper hotel product, proper price policy, and promotion and 2

sales policy. This means that they do not direct their business activities towards new market trends whereby they can not predict the changes of tourist demand. They have not defined their market target groups, what kind and what size of the segment they will cover and what differentiated product will enable them successful positioning. Table 3. Answers of the survey hotel managers in Struga
Question Do you apply the marketing concept in you business activities Do you have all management levels at your organization structure Do you have any positioning strategy Do have any strategy to enter the international market Do you use the IT technology in your Answers Yes No 2 2 9 2 9 1 1 3 3 15 2 1 1 Partly 19 -

cost leadership and focus are future planed strategies to a small part of hotels in Struga. So, the answer of the question, what is the strategy they are planning to use for market positioning, from 21 managers in total, 10 answered with differentiation product, 5 of them with cost leadership, 4 of them with specific groups of the market and 2 of them had no strategies. Table.4. Positioning strategies of hotels in Struga2)
Positioning strategies Total - With differentiation product - Cost leadership - Focus on specific groups of market - No strategies Total 47,61 10 23,82 5 19,05 4 9,53 2 100,00 In percentage

Not using a segmentation strategy has a direct impact at undifferentiated hotel product, having no vision how the same will develop and in what direction, and what elements are needed to make the product richer. Strategic aspects are partly used or applied improperly, and that combined with improper combination of marketing instruments does not give an opportunity to create better image of hotel companies in this region. Only hotel Makpetrol has strategic plans to enter international tourist market. Regarding the other hotels, we can conclude that they have undefined business areas where they can achieve competitive advantages. In these sense generic strategies1) such as differentiation strategy,
1)

With the same research we found some others negative factors at the business activities of hotels in Struga such as insufficient use of technology, especially for promotion and sales of hotel product, such as: not using CRS (Central reservation System) and GDS (Global Distribution System) and other organizational weaknesses. This indicates that strategic aspects are partially use or not implemented by hotel companies at Struga region. This kind of policy is not capable to initiate persistent changes in offer as a base for positioning or repositioning at the tourist market. On the other side, all this adversely affects the uncoordinated tourist activities in Struga region as a destination. To detect how Struga is functioning as a tourist destination we made an interview with the administrator of tourism
advantage it has to choose about the type of competitive advantage and desired scope wants to be achieved. With this they define that business area which will provide priority to hotels in the market against the competitors. 2) ., Strategic leadership the foundation for successful market positioning of hotel companies in Struga region,PhD thesis, Ohrid, 2011, p. 123

Generic strategies are the only successful way where hotel companies deal with all those competitive forces in the market. The foundation of generic strategies concept lies at the idea that competitive advantage is the bases of any strategy and achieving that puts the company to face the choice if the company aims to achieve completive

sector in local government seeking answers for tourist activities in local level. We asked does the local government have any strategic plans to develop tourism and the answer was that the municipality has its own program for developing tourism. In the program there are plans for building golf fields, sports and recreation facilities and winter tourist center (lift) in G.Belica, whose implementation is underway. However, Struga has no bureau for informations for tourists which has big effects in provoking the tourist demand at one tourist place. Also, the cooperation between local government and hotel companies is in a very low level, so we can conclude this is a negative factor in the sense of having a better offer and correct the deficiencies in this field. The question, do they take in account the suggestions made by the hotel companies, other tourist companies and associations, the answer was that the do not have any special arrangements which we consider a negative factor from the internal environment of the destination. We asked, do the local government takes any activities to enrich the offer in Struga, the answer was that they organize existing events and other manifestations that are traditional, but there is no special project for that. There is no team of managers or coordinative board, which represents a large bar in organization and marketing of Struga destination products. He also answered that they .make promotion activities and they attend at international fairs for tourism. But by the content and intensity appearances, they are poor and very rare. While in the question, has Sruga developed its own web page intended for tourism and tourist activities, the response were negative. As a negative fact we can consider the answer that local government does not organize customer survey, regarding their 4

praise and complaints on tourist activities in Struga. He also answered that they have a little cooperation with the Agency for Promotion Support and Development of Tourism in Macedonia and they do not coordinate their tourist activities. He answered that they occasionally coordinate the tourist activities with Ohrid as their closest competitive city and especially in their joint promotional activities. . From all of this, we can conclude that Struga does not practice destination concept in managing the tourist activities. This means that their business activities are uncoordinated especially in their joint promotion activities and tourist propaganda; there are no market researches to define the real opportunities for development, real destination product, unfinished categorization of hotels and very poor cooperation with other tourist destination. The successful positioning of hotel companies is not depending only on their separate hotel product but first of all the product has to be integrated in line with market opportunities and their possibilities. However, during the research we noted some values as a positive factor (distinctive capabilities) of hotel product in Struga. In essence achieving a competitive advantage mainly depends on distinctive capabilities as special capabilities of the company making her different in front of the others. Those capabilities we noted at hotels in Struga above all are attractive location, hospitality and low non-accommodation prices. Some of the hotels such as DRIM and Makpetrol have high quality accommodation offer, gastronomic services and have applied quality standard .for food (HASSP, ISO 2010), and qualified personal. The bigger hotels mainly dispose with sport fields and own parking lots and often perform guest animations and organize special tours and excursions. Struga as a destination abound with cultural historical resources, beautiful

nature, favorable climate, traditional and national cosine, etc.

4. STRATEGIC ALTERNATIVES POSITIONING THE HOTEL PRODUCT OF STRUGA AS A TOURIST DESTINATION

conducted with the manager of the tourism sector and all the data obtained from other associations, we can conclude that hotels in Struga are acting isolated from each in the tourist market. However, the modern tendency of world tourism is destination approach, or putting in one all elements of tourist offer. We know that tourism and the marketing of tourism, by definition understands systematic and coordinated adaptation of tourist companies policy and tourist policy of the state in local, regional, national and international level, with the only reason make the consumers happy and be profitable. From this we can note that accepting the marketing concept individually is not enough, but it needs good cooperation and coordination among all institutions in tourism On the other side, the modern concept of doing business in the field of tourism, is imposing coordination of tourist activities between all subjects involved in tourism, of tourist offer both the horizontal and the vertical. This means coordination and appearance as a whole, or accepting the destination approach means incorporating the management concept with tourist destination both in local level and other separate management systems and subsystems of tourist companies in Struga region. According to all said, we conclude that the main positioning strategy of the hotel product of Struga in the tourist market is: strategies for performance as a tourist destination. All other strategic opportunities which arise from distinctive capabilities of hotel companies and on the basis of attractive factors should be in the function of the main strategy and in this context the same has to be incorporated as developing strategies of each hotel in Struga region. So, all activities in formulating strategies in the future should be taken in account and shouldnt be an obstacle to the main strategy. The strategic management of destination is the only concept who can 5

According the current situation and advantages the Struga hotels have, we can formulate proper strategies for development and growth, or successful positioning in tourist market. Those are mainly three basic strategies such: - Segmentation of tourist market,
3)

Diversification of hotel product and - Differentiation of the hotel product, 4) However there are a range of other strategic opportunities such as: - To make an agreement with one of known hotel chains, - Aggressive tourist propaganda, - Cooperation with tourist agencies and foreign tour operators. - Extending the business activity season, - Defining the image, - Targeting a special group in the market and etc. The hotel companies in Struga region can provide to enter in to the international market with business partnership agreements in three ways: horizontally, vertically and combined type of partnership.5) As we can see from the data analyses made on each hotel, the survey
3)

Segmentation strategy can be made by different criteria: prices, reason to travel, needs, motivation, consumer benefit, and according their demographic, economic, geographic and psychographic features. 4) There are some differentiation strategies of the product: product/service attributes, benefit, needs, group of consumers, competition, category and quality of the product. 5) Business partnership can be achieved through agreements such as: export, franchise, licence, joint venture, fully owned branch office, etc.

generate developing strategies and provide economic development of Struga region. This approach will provide optimal economic growth; increase the living standards of Struga population, protect the cultural and historical heritage putting them in function of general economic development of Struga.
5. SUMMARY

[4]. Buble M., Strateske opcije, Ekonomski fakultet, Split, Split, 2000. [5]. . - , , , 2011

The proper strategic management which will enable successful market positioning of the holders of tourist offer is a key component of their business activities. Especially in the situation of dynamic changes of the environment with which they face today Each holder of tourist offer in Struga, and Struga as a destination in whole have not applied any modern approach of doing business. But, if they still want to present in the tourist market in the future and to ensure survival in it, they will be forced to accept the modern trends of doing business. So the main strategy thereby will have to be the strategy for performance as a tourist destination. Only, strategic management of destination is a concept who can enable successful application of strategic management and positioning of hotel companies, and with it to successfully oppose persistent and dynamic changes in the environment. They have favorable conditions; they have to make changes at their business approach.

6.

REFERENCES

[1]. . , -, 2002 [2]. . , , 2002 [3]. Ansoff I., Strategic Management, Mac Milan Press Ltd, London,! 995.