Evaluation Of The Degree Of Sustainability Of Travelodge Hotel  

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Table of Contents

1.0 Introduction............................................................................................................4

1.1 Background to the study........................................................................................4

1.2 Travelodge company profile..................................................................................5

1.3 Problem statement.................................................................................................5

1.4 Aims and objectives...............................................................................................7

1.5 Research questions...............................................................................................7

1.6 Significance of the study........................................................................................7

1.7 Limitations of the study..........................................................................................8

1.8 Conceptual framework...........................................................................................8

2.0 Literature review..................................................................................................12

2.1 Introduction..........................................................................................................12

2.2 Sustainability........................................................................................................12

2.3 Dimensions of sustainability................................................................................15

2.3.1 Environmental dimension.................................................................................15

2.3.2 Economic dimension.........................................................................................18

2.3.3 Social dimension...............................................................................................19

2.4 Rationale of sustainability and the limitations in its implementation....................20 

2.5 Conclusion...........................................................................................................23

3.0 Methodology........................................................................................................25

3.1 Introduction..........................................................................................................25

3.2 Research design and justification........................................................................25

3.3 Data collection......................................................................................................26

3.4 Data analysis and presentation...........................................................................26

4.0Results and Discussion........................................................................................28

4.1 Introduction..........................................................................................................28

4.2 Results and analysis............................................................................................28

4.2.1 Financial sustainability at Travelodge...............................................................33

4.2.2 Social and environmental dimension................................................................38

5.0 Summary of Findings, conclusion and recommendations...................................38

5.1 Introduction..........................................................................................................40

5.2 Summary of main findings...................................................................................40

5.3 Conclusion...........................................................................................................41

5.4 Recommendations...............................................................................................41

5.4.1 Customer Relationship Management...............................................................41

5.4.2 Diversity............................................................................................................42

5.4.3 Financial management.....................................................................................42

5.4.4 Corporate social responsibility..........................................................................43

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1.0 Introduction

1.1 Background to the study

Hotel managers are under pressure to ensure that their organisations achieve profitable growth.  To achieve this goal, the hotels management teams have a responsibility to develop sufficient understanding on the issues affecting the industry and their subsequent implication on the industry’s long term performance. One of the fundamental issues that hotel managers should be concerned with relates to sustainability. Jauhari (2013) affirms that sustainability has become a major driver in organisation’s quest to attain long term performance.  Moreover, sustainability can result in significant improvement in organisations financial performance. Sustainability entails the attempt by organisations to establish a balance between the social, environmental, and economic dimensions in the making decisions relating to the organisation’s short term and long term operations.

Jauhari (2013) contends that sustainability should no longer be perceived as a necessity but a critical factor in the success of every industry. Thus, industry players have a duty to pay serious attention to the concept of sustainability. Hoteliers are increasingly appreciating the importance of integrating sustainability as a critical dimension in their strategic management practices. The rationale of integrating sustainability is to promote the organisation’s long term survival.  Jones, Hillier and Comfort (2014) argue that achieving sustainability is complex because it entails adopting a multidimensional approach in managing an organisation’s operations. Therefore, it is imperative for organisations’ managers to adopt a holistic approach in their management processes.  This chapter is organised into different sections that include a brief profile of the company under investigation [Travelodge Hotel], statement of the problem illustrating the gaps in the firm’s sustainability, the research aims and objectives, the research questions guiding the study, the significance and limitations of the study.

1.2 Travelodge company profile

Travelodge Hotel Limited is a well established private limited company in the United Kingdom. The firm provides accommodation services to business and leisure travellers in Spain, the United Kingdom, and Ireland through its chain of budget hotel outlets. The hotel has been in operation in the hospitality industry for three decades since its inception in 1985. The hotel chain is comprised of 3 hotels in Spain, 11 hotels in Ireland and 456 hotels in the UK in addition to other outlets in other international markets. The hotel’s operations are facilitated by a workforce of 6,000 employees. To attain operational efficiency, Travelodge has implemented Information Communication Technology systems to facilitate online booking and payment for hotel services. Currently, Travelodge ranks as the 2nd largest firm in the UK budget hotel sector. 

1.3 Problem statement

            Despite the firm’s strong presence in the UK, Ireland and Spain markets, Travelodge has over the past few years experienced significant challenges that might negatively impact its sustainability. One of the critical dimensions of sustainability entails the financial dimension. Travelodge’s financial stability has dwindled significantly in the last five years. This has arisen from the firm’s overreliance on credit finance to facilitate its operations. By the end of December 2010, Travelodge’s total finance cost on bank loan was estimate to be £ 39.4 4million and an additional £51.9 million on Eurobond (Thomas, 2012).

            One of the factors that led to increase in the financial cost relates to the inflation caused by the payment in kind note [PiK] that was issued in 2006 upon its acquisition by the Dubai International Capital [DIC]. Thomas (2012) asserts that ‘the £ 50 million PiK note charges interests at 11% above LIBOR and has already grown in value to £ 78 million’ (para.5). The acquisition by the Dubai International Capital was partly financed through a $ 478 million loan from Permira. By 2012, the loan had grown to $517 million. The hotel has not been able to successfully generate sufficient revenue to repay the loan. In an effort to overcome the financial difficulty within the firm, Travelodge entered into a debt swap agreement with two New York Hedge Funds and Goldman Sachs. The agreement provides the two hedge funds [Avenue Capital Group and Golden Tree Asset] and Goldman Sachs the capacity to control the hotel’s operations. The hotel’s management team is of the view that this move will successfully pull out the firm from the current debt burden (Cave, 2015).

The firm’s inability to generate sufficient cash flow might limit the hotel’s capability to achieve long term sustainability. Over the past few years, Travelodgge has experienced reduction in its financial performance.  The firm has implemented different measures in an effort to restore its economic performance.  Despite the measures that the firm is implementing, the effectiveness and efficiency with which the firm can attain sustainability might be hindered by its over-focus on the financial dimension of sustainability.

Despite moving out of the debt burden, the hotel must devise effective strategies and practices that will ensure that it attains sustainable competitive advantage in the changing hotel industry. Moreover, the hotel’s approach in achieving long term sustainability through the financial restructuring efforts is skewed.  Additionally, financial restructuring does not mean that the firm will achieve sustainable competitive advantage. These aspects indicate that the hotel has not fully appreciated the value of entrenching a holistic approach in managing sustainability. However, if the hotel is to achieve long term sustainability, then adopting a balanced approach in managing sustainability is fundamental. The firm’s management team should consider sustainability as a key success factor.  Failure to establish a balanced approach might adversely impact Travelodge’s long term competitiveness. 

1.4 Aims and objectives

The aim of this study is to investigate the sustainability of Travelodge Hotel. To achieve this goal, the study will be based on the objectives outlined below.

  1. To investigate the commitment of Travelodge management team in establishing a holistic approach in achieving sustainability.
  2. To examine the gaps in Travelodge approach in managing sustainability.
  3. To recommend on the fundamental adjustments that Travelodge management team should consider in improving its sustainability.

1.5 Research questions

The following research questions will be taken into account in order to ensure that the above objectives are successfully attained.

  1. To what extent is Travelodge committed in establishing a holistic approach in achieving sustainability?
  2. What are the major gaps in Travelodge approach in managing sustainability?
  3. What are the fundamental aspects that Travelodge should consider in adjusting its approach in managing sustainability?  

1.6 Significance of the study

            The study’s findings will be of significant value in Travelodge quest to achieve competitive advantage in an industry that is currently characterised by a high rate of growth and change. First, the study will provide the hotel’s management team insight on the fundamental aspects of sustainability that should be entrenched. This goal will be achieved through evaluation of the best practices in achieving sustainability. Thus, the study will enable Travelodge to effectively restructure its operation by establishing a balance on the environmental, economic, and social components of sustainability.

1.7 Limitations of the study

            The study will involve a case study on the operation of Travelodge Hotel. Furthermore, the study is based on secondary research by reviewing documented literature on sustainability. One of the critical limitations of relying on secondary research relates to the credibility of the sources of data. To overcome this limitation, it is ensured that the data is only gathered from credible sources. Another limitation of relying on secondary research in conducting the study relates to the large scope of the secondary data. However, this limitation has been overcome by ensuring that only the relevant sources are selected. The rationale of effective selection of the data sources is to improve efficiency in managing the time and cost required to successfully undertake the study.

1.8 Conceptual framework

            According to Jones, Hillier and Comfort (2014), sustainability is not a new concept. Nevertheless, the concept has gained extensive attention over the recent past.  Its relevance is highlighted by the fact that sustainability initiatives have become a common trend amongst governments, industries and investors. However, the link between sustainability and a firm’s economic performance remains being a major question (Singal, 2014).  Jones, Hillier and Comfort (2014) affirm that the core purpose of sustainability is sustainable development, which entails an organisation’s capacity to successfully meet its current needs.

Traditionally, business managers were mainly concerned about maximising profit and wealth. However, achieving this goal has become challenging because of the intricate nature of the business environment. Subsequently, organisation managers have a duty to understand the relationship between the different components of sustainability that include the economic, social and environmental dimensions in order to achieve the overall objective.

The hospitality industry ranks amongst the most volatile industries due to the likely impact of instabilities arising from the external market. For example, the industry is affected by fluctuations in the rate of tourism. The United Nations World Tourism Organisation affirms that tourism development depends on the principles of economic, socio-cultural and environmental aspects (Sloan, Legrand & Chen 2013). Therefore, a suitable balance between the three dimensions must be promoted in order to guarantee the long-term sustainability of the tourism sector. According to Jones, Hillier and Comfort (2014), this will in turn have positive impact on the growth and development of the hospitality industry.  This assertion further indicates that the success of the hotel industry is highly dependent on the success of the tourism industry. According to Choi and Ng (2011), the hoteliers’ capacity to exploit the benefits associated with growth in the rate of tourism is greatly dependent on how effective hoteliers have implemented strategies and policies that contribute to establishment of a balance between the three dimensions.  Subsequently, hotel managers have a duty to entrench sustainable hotel operations that will not only benefit the firm but also other stakeholders. Achieving this goal requires the integration of the requisite resources, principles, and strategies. 

Traditionally, organisations integrated the different concepts of sustainability separately.  Considering the dynamic nature of the business environment, it is imperative for business leaders to understand the correlation between the three dimensions of sustainability (Choi & Ng, 2011). This research conceptualises that the attainment of sustainability will depend on the firm’s success in establishing a link between the three dimensions. The conceptual framework is based on the view that the firm’s long term performance will depend on how it manages the respective dimension.  

The intersection of the three dimensions of sustainability in the Venn diagram above represents the point at which Travelodge will succeed in establishing a balanced approach to sustainability.  The conceptual framework illustrates the interconnection between the diverse dimensions of sustainability. By establishing a link between the alternative dimensions, Travelodge’s long term performance will be improved considerably.  

 

Chapter 2

2.0 Literature review

2.1 Introduction

Chapter 1 highlights sustainability as a critical aspect in organisations quest to achieve competitive advantage.  This chapter entails a critical review of past literature on sustainability. The significance of this chapter is to undertake an extensive review on the foundations of sustainability.  The chapter is organised into different sections. The first section entails an extensive review on the concept of sustainability. Secondly, the different dimensions of sustainability that include the economic, social and environmental dimensions are expounded.

2.2 Sustainability

            Sustainability involves a corporate strategy aimed at promoting an organisation’s long term competitiveness, efficiency, performance and growth. Carcano (2013, p.38) defines corporate sustainability as ‘the satisfaction of the needs for direct and indirect stakeholders of companies shareholders, employees, customers, communities and without compromising the ability to satisfy the needs of future stakeholders’.  The concept has gained considerable recognition in the investment, media and political circles.  Investors and business leaders have over the past few decades been focused on formulating sustainability programmes and plans. This move has arisen from recognition of sustainability as a critical element in firm’s corporate strategies (Jones, Hillier & Comfort, 2014).  Carcano (2013) affirms that sustainability offers companies a unique opportunity to improve their competitiveness, innovation and to generate bottom-line. This outcome is attained through growth in the level of revenue and decline in the cost of operation (Carcano, 2013).The significance of sustainability is further illustrated by the increase in the number of regulations and legislation relating to sustainability. Governments and regulatory authorities are increasingly pressurizing businesses to integrate measures of that contribute to sustainability (Stoner & Wankel, 2010). An ever growing number of firms are publicly demonstrating and emphasising their dedication to sustainability as a fundamental strategy in promoting a high competitive advantage.  Therefore, sustainability has become an essential element in organisation’s effort to differentiate and strengthen their brand. 

Despite the increased support on sustainability, the concept has come under extensive criticism by different scholars. Some critics argue that the concept of sustainability is only a cynical strategy aimed at appealing consumers due to growth in the level of consumer concern regarding social and consumer issues. The critics describe the concept of sustainability as ‘green consumerism’ (Neda, Tina & Barbara, 2012).  Kahn (2010, p.48) emphasise that ‘green consumerism is an opportunity for corporations to turn the very crises that they generate through their accumulation of capital through the exploitation of nature into myriad streams of emergent profit and investment revenue’.  Additionally, the critics argue that most of the efforts by organisations towards sustainability have failed to result into the desired outcome and hence they are not effective in addressing the problem of unsustainable consumption.  Moreover, critics are of the opinion that the implementation of sustainability programmes increases the financial burden faced by an organisation.  Thus, the concept of sustainability presents a dilemma to most organisations.  The investments in financial sustainability might not necessarily pay-off either in the short term or in the long run (Jones, Hillier & Comfort 2014).

The achievement of sustainability demands organisations managers to integrate the social, economic and environmental dimensions in the corporate management process (Sloan, Legrand & Chen, 2013).  The concept of sustainability is founded on the stakeholder theory. According to the theory, organisations should not only be concerned on achieving profitability. On the contrary, they should also be sensitive to the interests of other stakeholders such as customers, suppliers, and the wider society.  Therefore, in the course of their operation, businesses are faced with the challenge of ensuring that the needs of the different stakeholder groups are satisfactorily met. 

Sloan, Legrand and Chen (2013, p. 23) further emphasize that ‘improvements in the area of economic, environmental, and social performance may significantly help integrate concepts of sustainable development into business practice, and lead to sustainability’.  However, achieving this outcome depends on an organisation’s efficiency in assessing the performance of the firm in respect to the three dimensions. Therefore, integration of effective key performance indicators should not be underestimated.  The key performance indicators should form the basis upon which the organisations managers assess the firm’s progress in attaining the predetermined strategic sustainability objectives. On the basis of the key performance indicators, it will be possible for organisations management teams to successfully undertake effective strategic planning on how to prioritize and manage the economic, environmental and social components of sustainability.

A global survey conducted on 224 business leaders showed that 60% of the business leaders recognise environmental and social responsibility as a critical strategic management aspect (Muller & Pfleger, 2014). However, it is imperative for organisations to adopt the triple-bottom-line concept in promoting sustainability. The three pillars [economic, social and environmental] must be applied concurrently because they are complementary.  Muller and Pfleger (2014) affirm that the three concepts are not interchangeable. The lack of inter-changeability underlines the existence of strong form of sustainability. On the contrary, weak sustainability argues that the different forms of capital, viz. human capital, manufactured capital and ecological capital can be sufficiently substituted (Muller & Pfleger ,2014). The aforementioned problem statement indicates the existence of challenges in Travelodge’s quest to achieve financial sustainability. The growth in the relevance of the concept of sustainability has arisen from different factors such as increase in resource scarcity, carbon emissions and unethical business practices. Moreover, different stakeholders are pressurizing businesses to integrate sustainability issues (Muller & Pfleger, 2014).

2.3 Dimensions of sustainability

2.3.1 Environmental dimension

            The environmental dimension of sustainability is concerned with an organisation’s impact on the ecosystem. Mignaqui (2014) affirms that environmental sustainability entails the integration of business practices that contribute to adequate protection of the natural resources. The contemporary business environment is currently undergoing remarkable transformation due to the high rate of climate change (Schwartz-Herion & Omran, 2015). One of the factors stimulating climate change entails increase in the rate of environmental degradation.  Amongst the causes of environmental degradation includes waste and carbon emissions. Sloan, Legrand and Chen (2013, p. 23) argue that businesses must be concerned about their carbon footprint.  This arises from the fact that increase in the rate of climate change destabilises economic activities and hence the consumers’ purchasing power.  The ultimate effect is decline in the hotel’s capacity to generate revenue. According to Bohdanowicz, Simanic and Martinac (2005), the operations of firms within the hotel industry might contribute to remarkable increment in the rate of climate change.  The hotel industry ranks amongst the largest users of consumer goods. Thus, their impact on the environment is considerable due to the high waste generation.  Bohdanowicz, Simanic and Martinac (2005) affirm that the hotel industry has been insensitive to the degree of environmental degradation caused by their operations and services. However, the level of environmental awareness has increased remarkably amongst the general public. This has increased the level of criticism on the practices and operations of rims within the hotel industry. Thus, hoteliers must be concerned on understanding and mitigating their impact on the environment through effective management practices. Hoteliers should consider sustainability as a contemporary corporate issue. 

The environmental dimension of sustainability has become a major concern for most organisations in the hotel industry.  Despite the increased attention on the concept of sustainability within the contemporary hotel industry, the application of the strategy varies considerably across the industry players.  A survey conducted on 10 of the leading hotel chains in the United States shows that 4 of the hotels undertake formal sustainability reporting while 6 of the hotels provide limited information on their approach to sustainability. Some of the leading hotels such as Marriott, Hilton, and Ramada [Wyndham Worldwide] have stipulated clear missions on how they intend to attain long term performance without negatively impacting the environment.  Some of the hotels have outlined their commitment to managing diverse environmental issues such as greenhouse gas emissions, climate change, waste management, environmentally responsible sourcing, and energy and water conservation (Jones, Hillier & Comfort 2014). 

 In 2013, Hilton publicised its commitment to improve its water conservation by 10.2% and reduce its waste by 24.9%. The hotel further affirmed its focus on environmental stewardship (Bruns-Smith, Choy, Chong & Verma, 2015). In spite of the hotels’ affirmation of their strong commitment in entrenching sustainability, most of the hotels are only recognising of the complex and ardours nature of sustainability (Jones, Hillier & Comfort 2014).

To achieve these commitments, some hotels such as Hyatt have implemented systems aimed at tracking their performance with regard to attainment of the set sustainability targets.  Similarly, the Wyndham Worldwide hotel recognises measuring its impact on the environment as the first step in mitigating its footprint.  On its part, Marriot Hotel has formulated an integrated global environmental strategy that enables the hotel to manage energy and water efficiency. This indicates the existence of a trend whereby hotels are appreciating the importance of environmental protection in promoting their overall performance.

The resource-based theorists accentuate that profit oriented organisations invest a substantial amount of rare, valuable, inimitable and non-substitutable resources in the quest to gain sustainable competitive advantage.  The theorists further contend that corporate social performance contributes to remarkable benefits to organisations such as reduced risks, higher revenue generation, reduced costs and high profits (Cortez & Cudia 2011).  The implementation of environmental sustainability is currently being achieved through development of programmes aimed at protecting the environment. One of the approaches that organisations are focusing on entails efficient and effective resource utilisation. Furthermore, Bruns-Smith et al (2015) affirm that environmental sustainability is being implemented through avoidance of business practices that can contribute to environmental pollution.

2.3.2 Economic dimension

The core goal of profit oriented organisations is to maximise profit.   However, the attainment of this goal is dependent on an organisation’s efficiency in managing its operations.  An organisation’s capacity to achieve sustainable profit is influenced by its success in promoting economic sustainability. Muller and Pfleger (2014) define economic sustainability as an organisation’s capacity to sustain economic production indefinitely. Despite the view of some scholars that sustainability programmes increases an organisations  financial burden , the concept of economic sustainability is critical in enhancing an organisation’s capacity to cope with intense competition and hence its probability of attaining long term success (Muller & Pfleger 2014).

Cortez and Cudia (2011) affirm that a strong correlation exists between an organisations financial performance and sustainability. The sustainability practices undertaken by a firm has an influence on the shareholder value. For example, some of the technologies and environmental management practices incorporated by a firm such as revenue enhancement, quality improvement, reduction on business risk and cost reduction contribute to improvement in an organisation’s economic performance (Cortez & Cudia, 2011). 

The global economy has over the past few decades been characterised by considerable reduction in organisation’s efficiency with regard to managing economic sustainability.  This phenomenon is well illustrated by the remarkable decline in businesses life expectancy. Most industries have been characterised by increase in the rate of mergers, acquisition and bankruptcies. The acquisition of Travelodge by DCI is a strong indicator of the firm’s ineffectiveness in achieving economic sustainability.   The increase in the rate of poor financial performance amongst firms that were previously listed in the major stock markets such as FTSE over the past decades illustrates the significance of organisations increasing their focus on the economic sustainability (Doane & MacGillivray, 2001).  The existence of gaps in organisations efficiency in attaining economic sustainability is further underlined by the recent economic meltdown, which emanated from the collapse of major Wall Street financial institutions in 2008. This occurrence has led to remarkable improvement in the relevance of economic sustainability across the world.  The decline in the level of economic sustainability within organisations has increased the consumers’ concern due to incidences of cases of job loss and hence affecting the consumers’ purchasing power negatively (Choi & Ng, 2011).

2.3.3 Social dimension

Social sustainability entails an organisation’s effort to establish a system that contributes to poverty alleviation.  The theory of social sustainability postulates that a strong correlation exists between sustained natural resource utilisation and sustained poverty levels. Business organisations are major contributors to the social problems currently being experienced due to their continued resource utilisation (Basiago, 1999).   The social sustainability theory further underlines the importance of organisations pursuing economic sustainability within the framework of social equity (Choi & Ng, 2011). Therefore, to achieve long term economic performance, organisations must optimise resource utilisation, promote equitable distribution of resources and prioritize resource allocation.   Alternatively, Choi and Ng (2011, p. 270) affirms that ‘the social dimension of sustainability is concerned with the well being of people and communities as a non-ecological form of wealth’. 

The social dimension of sustainability is mainly concerned with establishing equilibrium between the societal and personal needs and the capacity of the ecosystem to support the ecosystem.  The relevance of social sustainability in the contemporary business environment is underlined by the increase in the number of scandals such as the Enron scandal (Choi & Ng, 2011). The Enron Scandal exemplifies the existence of gaps in organisations capacity to satisfy the stakeholder needs.  Furthermore, the scandal underlines the existence of tension between the business and society interests.  A global study conducted in 1999 showed that over 75% of consumers are concerned about organisations contribution towards the attainment of broader social goals.  The increase in the relevance of social sustainability is underscored by the high rate at which organisations are incorporating the concept of Corporate Social Responsibility (CSR). The rationale of integrating CSR as an approach towards social responsibility is to promote the company’s brand reputation.

2.4 Rationale of sustainability and the limitations in its implementation 

The global hotel industry has over the past decades undergone remarkable transformation. One of the aspects that illustrate the industry’s transformation entails the establishment of diverse hotel formats. Europe ranks as the leading tourism destination in the world. A survey conducted in 2014 showed Europe received approximately 600 million international tourists. Additionally, over 2.7 billion nights were recorded in the European Union, which represents a 1.7% growth compared to the 2013 level (PricewaterhouseCoopers, 2015).  One of the factors that contribute to growth in the European hotel industry relates to the high rate of tourism.  Europe is characterised by a substantial number of cultural and historical attractions, trade fair and events such as sports events.  The high rate of tourism in Europe is facilitated by the over 680,000 hotel rooms in the region. The growth is further spurred by increase in consumer confidence (PricewaterhouseCoopers, 2015).  

Achieving sustainability has a strong correlation with an organisation’s capacity to exploit the opportunities available in the hotel industry. This assertion arises from the fact that sustainability contributes to improvement in corporate image and reputation. Subsequently, the probability of a firm attracting and retaining customers is increased remarkably. Furthermore, the likelihood of an organisation attracting and retaining talent is improved considerably.  Yilmaz and Flouris (2012) affirm that contemporary businesses should fully integrate sustainability not only as a risk management approach but also as a strategy for exploiting the available business opportunities. According to Yilmaz and Flouris (2012) the new opportunities might arise from development of new products in order to align with the dynamic sustainability needs. Sustainability enables an organisation to effectively and efficiently establish a balance between the essentials of sustainability and the quest for profitability.

 In spite of the high rate of growth, the hotel industry is experiencing challenges emanating from macro environmental change (Mulford & Comiskey ,2005).  For example, technological innovations such as the digital and mobile revolution present a new challenge in hotels effort to remain relevant to customers.  Conversely, improvement in economic performance presents an opportunity for hotels to grow. According to a study conducted by PricewaterhouseCoopers (2015, p.2), ‘there is plenty of room to grow on many fronts including traveller volume, new hotels and brands, trading metrics and investment opportunities’.  Consumers in Europe have over the past two years experienced a remarkable improvement in their discretionary spending power, which is expected to continue in 2016. It is expected that the uncertainty arising from the Eurozone and Greece economic crisis will not diminish the projected future growth.  Thus, the significance of entrenching sustainability in promoting the organisation’s long term survival should not be underestimated.

However, past study reveal existence of challenges in organisation’s effort to incorporate sustainability. Yilmaz and Flouris (2012) affirm that entrenching sustainability in an organisation’s operation is not a simple task.  The concept of sustainability remains ‘siloed’ in most organisation and is mainly the obligation of a single manager or a department. Irrespective of some organisations implementing a comprehensive approach to sustainability by making it an organisational wide aspect, Bansal and Chort (2013) affirms that communicating sustainability continues being a challenge. 

One of the fundamental problems encountered relates to poor leadership. Burns, Vaught and Bauman (2015) affirm that sustainability leadership is a new concept and is different from the traditional approach to leadership. The difference arises from the fact that sustainability leadership requires an inclusive approach. Most organisations experience a challenge in ensuring that all the employees develop a common vision regarding the organisation’s approach to sustainability. Employees develop different opinion regarding the importance of sustainability to an organisation and how it is related to their roles (Burns, Vaught & Bauman 2015).  Bansal and Chort (2013) are of the opinion that leadership for sustainability is founded on transformational leadership. However, it goes beyond transformational leadership.   Therefore, the implementation of sustainability in an organisation’s operation is determined by the quality of leadership.

 In addition to the above issues, the successful implementation of sustainability within organisations is further hindered by leadership changes.  Bansal and Chort (2013) accentuate that a high rate of turnover amongst senior organisational executives affects the implementation of sustainability programmes. Additionally, the payback period of some of the sustainability programmes is considerably long.  In most cases, the new leaders might not be focused on achieving the desired sustainability outcome. Thus, change in leadership might negatively affect the implementation of an organisation’s sustainability agenda.  This underlines the fact that successful implementation of the sustainability approach is influenced by the level of retention amongst the senior leaders and their commitment in ensuring that the lower level employees are adequately engaged in achieving the stipulated organisational goals.

The attainment of sustainability is also hindered by the low level of innovation within organisations. Burns, Vaught and Bauman (2015) argue that some organisations have not attached value to sustainability programmes and usually consider it as a way of deviating organisations funds to programmes that are not guaranteed to improve the organisations profit.  Thus, innovation that would rather contribute to an organisation’s sustainability is adversely impacted.

2.5 Conclusion

The chapter review different literature on the concept of sustainability.  The review underlines growth in the concept of sustainability within organisations over the past decades. However, the review shows that a number of issues are critical in organisations’ effort to achieve sustainability.  Amongst the fundamental aspect entails integration of the tripartite approach in organisations quest for sustainable development.  Organisations should establish a balance between the social, economic and environmental dimensions. To achieve this outcome, organisational leaders should focus on understanding the requisite aspects in the implementation of sustainability on the basis of the three dimensions. The review further underlines that successful implementation of the three dimension of sustainability can contribute to remarkable improvement in an organisation’s long term success.  However, the review further illustrates the existence of divergence with regard to the relevance of sustainability programs. Some scholars argue that sustainability is only a cynical ploy and leads to diversion of organisations resources. The chapter further indicates the existence of challenges in the implementation of sustainability within organisations. One of the challenges relates to ineffective leadership.

 

Chapter 3

3.0 Methodology

3.1 Introduction

This study aims at evaluating the sustainability of Travelodge Hotel. The study’s rationale arises from the recognition of sustainability as a valuable strategic management issue in attaining long term success in the hospitality industry. The hotel industry is very susceptible to the volatility emanating from the external market changes. Thus, achieving competitive advantage in such an industry requires implementation of effective strategic management practices.  The paper intends to achieve the research objective by evaluating the prevailing gaps in Travelodge Hotel approach to achieving sustainability.  This chapter outlines the methodological approaches that have been taken into account in the process of conducting the research study.

3.2 Research design and justification

This study is based on the qualitative research design. The rationale of selecting this design is to gather sufficient data on the implementation of the concept of sustainability within the Travelodge Hotel.  Therefore, the research study can be defined as exploratory.  The study intends to use the exploratory research as an approach of gathering insight on the application of the concept of sustainability in the real business environment. McNabb (2015) emphasises that exploratory research is very effective in analysing a particular situation.  The exploratory research approach improves the efficiency with which the researcher understands the critical issues associated with the problem under investigation. Sreejesh, Mohapatra and Anusree (2014) emphasise that ‘exploratory studies are conducted for three main reasons, which include analysing a problem situation, to evaluate alternatives and to discover new ideas.  To achieve this outcome, the exploratory research design is supported by entrenching a case study on Travelodge. Therefore, the case study approach provides the researcher an opportunity to examine the specific components related to the application of sustainability within the Travelodge Hotel. 

3.3 Data collection

The data used in conducting a research study influences value of the study’s findings in making relevant recommendations on how to improve the situation under investigation. Subsequently, the relevance of the study to the target audience is reduced significantly (Smith & Smith, 2008).  To overcome this challenge, effective selection of the sources of data is essential. The data used in conducting this study is sourced from secondary sources, which entail obtaining data from previously documented sources such as journals, magazines, and online articles. McNabb (2015) corroborates that secondary data is the most common source of data used in undertaking exploratory research. 

To improve the quality of the research study, the research data is sourced from company literature such as press releases and annual reports.  By relying on these internal sources, the credibility of the research data will be improved considerably.  Subsequently, the reliability of the research finding is improved. Moreover, the secondary sources of data further entail external sources such as analysis by industry experts and from periodicals.

3.4  Data analysis and presentation

            The research data collected from previously documented sources is both qualitative and quantitative in nature. The data obtained from the secondary sources is evaluated using secondary analysis. Smith and Smith (2008) assert that the secondary data analysis method involves re-analysis of existing data. Long-Sutehall, Sque and Addington-Hall (2010, p. 336) support the view that ‘the re-use of archived datasets and secondary analysis has gained interest and momentum due to the recognition by researchers that many qualitative datasets offer narratives that discuss issues related to the primary research questions, but which have never been analysed’. The secondary data analysis approach creates an opportunity for generation of new knowledge on how Travelodge can successfully implement the concept of sustainability.

The secondary data analysis will further be enhanced through integration of thematic data analysis process. The rationale of integrating the thematic analysis is to improve the efficiency with which study focuses on the issues raised by the research objectives and questions. In summary, the application of the methodological approaches and techniques highlighted herein will lead to development of sustainability on the degree to which Travelodge Hotel is sustainable in its operations.

In the process of collecting the secondary data, the researcher has ensured that the necessary ethical standards are adhered to. For example, the researcher has ensured that the data obtained is not interfered but is recorded as it is from the source. This has ensured that the credibility of the data is maintained. Moreover, the researcher has ensured that the authors or owners of the original source of data are accorded recognition through citing the source of data.

 

Chapter 4: Results and Discussion

4.1 Introduction 

            The rationale of this paper is to examine the level of sustainability at Travelodge.  Through the adoption of the descriptive research design and the secondary data analysis method, the study has led to generation of substantial amount of data on the level of sustainability at Travelogdge Hotel. This chapter presents the results, analysis and discussion of the study’s findings. The analysis focuses on answering the research questions and hence the study’s objectives.

4.2 Results and analysis

4.2.1 Financial sustainability at Travelodge

An evaluation of different secondary sources of data reveals the existence of remarkable challenges with reference to sustainability at Travelodge Hotel.  One of the fundamental issues relates to the fact that Travelodge has over the past few years been marred by a high level of debt. A review of the company’s financial performance in 2010 shows that Travelodge’s earnings before interest and tax [EBIT] amounted to £ 47.8 million (Pratley, 2012). The low level of the firm’s EBIT was not sufficient to support the firm’s debt, which was close to £ 500million. On the basis of these results, one can argue that the company was highly geared, which means that its bank debt to EBIT is approximately 10:1. This aspect illustrates the existence of poor administration and financial management which constitutes one of the key pillars of financial sustainability (Benerjee, 2015).

One of the sources of debt relates to unsustainable levels of debt from its over 500 hotels outlets. The ‘un-sustainability’ of the rent was worsened by the occurrence of the financial crisis that preceded the property boom (Wood, 2015).  Travelodge conducts its operations from rented premises. In an effort to move out of debt, the hotel’s management has considered a number of options. First, the hotel considered entering into a Company Voluntary Arrangement [CVA]. The CVA entails a legal undertaking, which allows a firm to write off some of its debts (Wood 2015). On the basis of the CVA, Travelodge was required to dispose 49 of its hotels (Harmer, 2013). Secondly, the debt led to the hotel’s management team considering the option of disposing off some of its hotels. Subsequently, in 2012, the hotels management team announced its intention to sell-off some of its 49 hotel outlets (Wood, 2015). This move would have put the jobs of over 350 employees at risk. Through this approach, the hotel’s management team expected to generate £ 1 billion from the sale of some of its outlets.  Another strategy that the hotel employed in an effort to move out of the debt arising from the high rent entailed restructuring the debt. To actualise this strategy, Travelodge sought the support of the landlords, shareholders and lenders to reduce the monthly debt by 25% (Wood, 2015).

Over the past three years, the hotel has engaged in extensive revamping of the hotel outlets which has been actualised through redesigning of the hotel rooms.  The firm invested £ 100 million for the modernisation program (Travelodge, 2015). The hotels redesign process has led to remarkable improvement in the amount of revenue generated from the hotel’s operations.  The company’s financial reports illustrate considerable improvement in various financial performance variables.  Between 2013 and 2014, the company’s rate of room occupancy increased from 74.5% to 75.5% (Travelodge, 2015). This represents a 1% growth, which is substantially low. The graph below illustrates the company’s financial performance over the past two years.

 

 

 

Revenue performance in  £

 

2014

2013

% Growth

International

7.3

6.2

17.7%

UK

489.9

426.4

14.9%

Total Revenue

497.2

432.6

 

Table 1

From graph 1, it is evient that Travelodge has experienced a substantial increase in the size of its revenue between 2013 and 2014. One of the factors thata has contributed to improvement in the company’s financial performance relates to the effective and efficient financial management by Goldman Sachs (Chesters, 2015). Considering the fact that Goldman Sachs is officially exiting the management of the firm, the capacity of Travelodge to sustain its strong financial performance in the future through application of effective financial management practices remains to be a major challenge. The largest growth in the hotel’s revenue was experienced in the hotel’s international market operations as indicated by the 17.7% growth compared to the 14.9% growth in the UK market. Similarly, the company has undergone extraordinary improvement with regard to the size of its operating profit  between 2013 and 2014 as illustrated by graph 2.

Year

Operating profit in million  £

2014

30.3

2013

5.6

 

            Despite the large difference in the company’s operating profit between 2013 and 2014, the probability of the company sustaining the high profit growth in the future is a challenge. The high debt characterises the firm’s has made it challenging from the revenues generated to strengthen its competitiveness (Allison, 2015). Moreover, the firm has not been able to successfully reduce the debt level despite the growth in sales revenue and operating profit. This finding is illustrated by the negative trend in the firm’s net bank debt in table 3 and graph 3.

Year

Closing net bank debt Amount in million £

2014

(355.4)

2013

(336.2)

Table 3

 The negative cash flow as indicated by table 3 indicates existence of inefficiency in the banks ability to establish a positive cash flow.  The negative cash flow might significantly reduce the firm’s ability to cater for its daily expenditure. Subsequently, a firm might be forced for resort to borrowing (Banerjee, 2015). One of the factors that might have contributed to decline in the firm’s level of cash flow entails the firm’s rapid expansion programme (Tracy & Tracy, 2004).  Mulford and Comiskey (2005) supports the view that a negative cash flow is acceptable if it will lead to generation of cash flow in the future. Considering the firm’s negative financial performance, Travelodge’s capacity to sustain its competitiveness  might be hindred. Eleftheriou-Smith (2012) accentuates that despite the fact that Travelodge is currently being engage in rapid expansion programme, the hotel has extensively compromised on value. Eleftheriou-Smith (2012) emphasises that ‘many Travelodge guests have to endure their stay’ (p.1).

4.2.2 Analysis of social and environmental dimension

A further review of available secondary data  reveals existence of remarkable gap in the hotel’s operation with reference to the social and environmental dimensions of sustainability. One of the aspects that illustrate the lack of social sustainability relates to the firm’s inefficiency in appreciating the value of developing effective and strong customer relationship.  The company has in the recent past been accused of mistreating customers and engaging in unethical practices. One of the issues that best illustrate  the existence of unethical practices entails the deduction of money from the customers’ credit card without their consent. The review of the available secondary data shows that the company can deduct approximately £ 150 from a customers’ debit or credit card if they accuse the customer of smoking in their rooms (Boyce, 2015). Despite the fact that the firm has stipulated a ‘no-smoking’ clause in its terms and conditions, the deduction is undertaken without the customers’ knowledge. Moreover, the firm makes the deduction even without the evidence of the client’s smoking in the room. This indicates the prevelence of unethical practices in the firm’s administration process.

The prevalence of unfair customer treatment is further illustrated by the hotel’s engagment in ‘overbooking’ the hotel rooms. This situation occured due to allocation of hotel rooms to more than one customer (Boyce, 2015). The existence of this practice indicates that Travelodge is overly concerned with the generation of sales revenue without appreciating the value of customer satisfaction. 

            The unethical practice within the hotel is further depicted by complaints that have been filed by customers. An example of unethical problem entails the complaint by a customer regardiing the presence of a webcam in one of the hotel’s showers (Bains, 2015). In this incident, a customer discovered a hidden camera in one of Travelodge showers. This discovery made the customer feel violated. Upon enquiry from the hotel, Travelodge management team afirmed that the camera was for maintenance purpose. Such an argument is not only satisfactory but can contribute to remarkable damage on the hotel’s reputation (Bains, 2015).          

The secondary data reviewed further indicate that Travelodge has been  involved in incidents of discrimination on its customers on the basis of their race. In 2012, Travelodge  was accused of discriminating against Leo Nocentelli, a Grammy Award winning guitarist of African American origin at one of its outlets in New Orleans (Brown, 2014). In this incident, Travelodge denied the guitarist together with his band permission to check in at the hotel for a performance at the Brick & Mortar Hall. Despite the fact that Leo Nocentelli was forced to pay a total of $300 dollars to gain entry, he together with his band did not gain entrry (Brown, 2010).  However, Rich Vogel, a white musician was allowed to enter the hotel without any problem. The firm’s employee involved in this incident argued that Travelodge does not accept credit card from black customers (Brown, 2010).  This occurence highlights that Travelodge does not comply with the stipulations outlined under the California Unruh Civil Rights Act of 1959.  The Act prohibits individuals and businesses from engaging in acts that might amount to discrimination either on the basis of race, age, gender and origin amongst other variables (Haupt & Rockwell, 2006).

 The existence of disconnect in the company’s operational processes and hence its skewed approach to sustainability is further evidenced by the discriminative approach in dealing with religious issues. The secondary data indicates lack of religious tolerance. Schroeder (2013) identifies religious tolerance as one of the fundamental components in attaining sociall sustainability. In 2014, the hotel was accused of removing all Bibles from its hotel rooms in the UK. This move was intended to caution the firm against discriminating against the non-Christians (Perring, 2014).  Despite the fact that the hotel intended this move to shield the firm from being percieved to discriminate against the non-Christians, the move in reality indicates ineffectiveness in the firm’s effort to promote social sustainability across all its outlets. One of the notable critic of the firm’s move entails the Church of England spokesman who emphasises that it is both tragic and bizarre for the firm to remove the Bible for the sake of economic incentive and ergnomic design (Perring, 2014).  In spite of the fact that this move is expected to attract the non-Christian customers in its hotel rooms, the move might be counter productive. This view arises from the development of the perception that the hotel is adopting hostile approaches against the Christian customers. This occurence might threaten the firm’s effectiveness in attracting and retaining customers. The overall effect will be reduction in the firm’s efficiency in generating and sustaining high levels of revenue ( Aras, 2015).  

In addition to discrimination of its customers, Travelodge has been characterised by cases of discrimination against its employees.  One of the notable cases was revealed by William Fry Solicitors in 2014 in which Travelodge was accused of discriminating against a Polish receptionist whom the firm had issued a maternity leave. Upon her return, the firm had reduced her average working hours per week without her knowledge and so was her salary. On enquiring about the decision, she was informed that her English was not fluent and that she was not capable of working during the day shift. The firm made this decision despite the fact that she had worked as a receptionist within the firm for over three years (William Fry, 2014). This indicates extensive disregard for the employees’ rights.  In reaction to the company’s decision, the receptionist lodged a complaint with the UK Equality Tribunal. Subsequently, the firm was forced to compensate the employee £ 63,000 (William Fry, 2014).  The aforementioned cases illustrate the fact that Travelodge has not fully appreciated the fundamental aspects that constitute diversity in a firm’s operation.  Mares (2004) argue that businesses should provide all employees irrespective of their demographic characteristics equal employment opportunities.  The discriminative action against some employees might affect the firm’s efficiency in delivering unique customer experience. This situation might arise due to lack of satisfaction amongst the employees. Subsequently, their commitment in offering serving customers might be adversely affected. Moreover, the discriminative practice against the firm’s employees might impact the firm’s competitiveness in the global labour market. Therefore, the firm’s efficiency in attracting and retaining talent might be reduced significantly.

            Despite the existence of gaps in the firm’s operation with reference to the social and economic or financial dimensions of sustainability, Travelodge has implemented remarkable measures aimed at entrenching ecological integrity. Duncan, Jancar-Webster  and Switky (2009) define ecological integrity to include ‘the process of living in harmony with natural systems, clean air, water and land use that meets human needs and maintains the essential elements of the eco-system’ (p.39). Analysis of the available secondary data further shows that Travelodge is extensively committed in protecting the environment. One of the areas that the hotel focuses on entails reducing the amount of carbon footprint. The firm’s motivation towards this programme has arisen from the need to reduce climate change. The firm intends to actualise this plan through a collaborative effort with its partners and suppliers. Travelodge has implemented diverse green technologies in the quest to reduce its carbon foot print. Some of the critical areas that the firm has focused on include energy consumption and efficient water utilisation. The hotel has implemented different energy conservation devices in its premises.  For example, the firm has implemented technologies aimed at improving the firm’s capacity to utilise solar energy (Travelodge, 2016). To improve its environmental sustainability, Travelodge should not only focus on the internal environment but should also consider the external stakeholders. Park, Choi and Kim (2012) affirm that organisations should motivate consumers to consume environmentally friendly products. This approach will improve Travelodge effectiveness with reference to environmental sustainability.

 

Chapter 5: Summary of Findings, conclusion and recommendations

5.1 Introduction

The motive of this paper is to evaluate the extent to which Travelodge has succeeded in entrenching the concept of sustainability. The rationale of conducting this paper arises from identification of sustainability as a fundamental strategic management aspect in organisation’s long term survival. Failure to successfully entrench sustainability limits an organisation’s efficiency in developing competitive advantage (Duncan, Jancar-Webster & Switky, 2009). This chapter summarizes the entire research. It first provides a brief summary of the whole study with particular reference to the research problem, the study’s results, the main contributions of the research and recommendations that Travelodge’s management team should take into consideration in order to remedy the situation. 

5.2 Summary of main findings

The study shows that Travelodge has experienced significant challenges with reference to economic sustainability because of the high debt. In an effort to move out of the debt, Travelodge’s management team has implemented a number of financial restructuring efforts.  One of the fundamental restructuring efforts identified entail the debt swap between the firm and the US hedge firms.  Moreover, Travelodge has in the recent past engaged in a rapid expansion programme. This move has enabled the firm to generate revenue. Nevertheless, the amount of revenue that has resulted from the hotel expansion and the innovative redesign of the hotel rooms have not been sufficient to enable the firm to successfully move out of the debt.  Therefore, the study shows that Travelodge’s management team has not fully developed sufficient understanding on the importance of effective finance administration and management. This aspect is evidenced by the firm’s overreliance on debt finance in order to support its operations. Thus, Travelodge has been characterised by a high debt to earnings ratio, which is an indicator of managerial inefficiency. The high debt to earnings ratio might diminish the hotel’s attractiveness to investors.

The study further reveals the existence of significant gaps with reference to the social dimension of sustainability.  Despite its past success, Travelodge has not fully appreciated the importance of diversity in its quest to improve its long term performance. A review of secondary data indicates increase in cases of discrimination and unethical practices in the hotel’s treatment of its customers and employees.  The removal of Bibles from the hotel rooms in the UK and the lack of equal treatment of the receptionist identified in the study shows that Travelodge has disregarded the concept of diversity. Stoner and Wankel (2010) assert that diversity in an organisation’s operation should be implemented by ensuring that all the internal and external stakeholders are treated with a high degree of equity.  Due to the discrimination against the receptionist, Travelodge was fined a substantial amount. Additionally, the hotel’s accusation of deducting money from the customers’ account on the ground of the customer’s engagement in restricted practices such as smoking in their rooms without prove might affect the customers’ repeat purchase behaviour. Subsequently, the hotel’s capacity to generate revenue might be hindered.

These occurrences might negatively impact the hotel’s global reputation and hence its competitiveness.  Therefore, the efforts that the hotel is currently undertaking through the rapid hotel expansion and room redesign programme in the pursuit for economic and environmental sustainability might be ineffective in improving the hotel’s long term competitiveness. The ineffectiveness of these measures might arise due to the firm’s ignorance on the value of entrenching social sustainability.

5.3 Conclusion

The study’s results reaffirm fact that Travelodge has adopted a skewed approach towards sustainability. Despite the fact that one of the core goals of profit oriented entities is to generate revenue, Travelodge has not been effective in establishing financial stability. Its ineffectiveness arises from lack of financial acumen amongst the hotel’s management team. Subsequently, the hotel has been forced to rely on debt finance in order to sustain its operations. Moreover, the hotel has not been able to successfully move out of debt despite its improvement in the ability to generate revenue. Thus, the hotel has been characterised by a negative cash flow balance. The inability to pay its debt might affect the hotel’s effectiveness to implement the best human resource management practices such as employee training and development.  Therefore, its capacity to attract talent from the global labour market might be affected. This situation might further be worsened by the hotel’s failure to fully appreciate the importance of diversity as illustrated by the discrimination amongst some employees and customers on the basis of their demographic characteristics such as race and religion.  

In summary, the study underscores the importance of establishing a balance between the economic, social and environmental dimensions of sustainability. Failure to appreciate this aspect might lead to make the sustainability efforts undertaken by a firm counterproductive. Subsequently, the contribution of the sustainability measures in the development of competitive advantage might be hindered.

5.4 Recommendations

            Despite the existence of gaps in Travelodge’s approach to sustainability, the hotel’s management team can successfully improve the firm’s performance by adopting a holistic approach. Some of the fundamental issues that the hotel’s management team should take into consideration are explained herein.

5.4.1 Customer Relationship Management

Travelodge should appreciate the fact that its capacity to generate sustainable levels of revenue and profit depends on the ability to attract and retain customers. To achieve this outcome, it is imperative for the hotel’s management team to be concerned on the hotel’s capacity to deliver unique customer experience. Investing in effective customer relationship management will improve the employees’ knowledge on how to treat customers. In the course of its CRM, Travelodge’s management team should ensure that the employees develop a high level of customer focus. This goal can be achieved through investment in extensive customer service training.  Consequently, the employees will develop a higher understanding on the importance of ensuring that customers are effectively treated. By creating unique customer experience through customer service, Travelodge will succeed in attracting and developing repeat purchase behaviour amongst its customers.

5.4.2 Diversity

The study indicates existence of significant gap with reference to development of social sustainability in at Travelodge. The existence of this gap might diminish the effectiveness with which Travelodge sustains its competitiveness.  One of the approaches that the hotel should pursue in order to successfully develop sustainable competitive advantage entails diversity. Travelodge should appreciate the importance of developing competitiveness in the global labour market by investing in diversity.  One of the areas that the hotel’s management team should consider entails provision of equal employment opportunities.            Furthermore, Travelodge should focus on developing an environment that is conducive for working.  Some of the aspects that the management team should consider entail providing employees’ equal opportunities such as training and promotion. Through this approach, the employees will feel valued hence developing positive workplace behaviour. The ultimate effect will be improvement in the level of employee motivation (Ones & Dilchert, 2012). Thus, the hotel should desist from discriminating employees on the basis of their demographic characteristics. 

In addition to the aforementioned aspects of diversity, Travelodge should develop a comprehensive code of conduct, which should act as the guideline that employees should follow in the course of dealing with customers and executing their duties. The firm should ensure that the employees understand the code of conduct. Moreover, the code of conduct should further form the foundation on which the firm assesses the employees’ behaviour towards the fellow workmates and external parties such as customers.  The appreciation of diversity will not only improve the attractiveness of Travelodge to potential employees. On the contrary, the move will further improve the rate of employee retention. Subsequently, Travelodge will not incur high cost in recruiting employees to deal with the high rate of turnover.

5.4.3 Financial management

As a budget hotel, Travelodge is characterised by a unique opportunity to generate high sales revenue. However, one of the fundamental approaches in achieving this outcome entails efficient utilisation of the financial resources. To achieve this goal, Travelodge should consider the training the employees in the managerial job positions on effective financial management practices. This will minimise the likelihood of the hotel engaging in unsustainable practices such as rapid expansion. On the contrary, Travelodge should consider other avenues of generating profit without necessarily incurring high cost. One of the techniques that the firm should consider entails franchising. Through this technique, Travelodge will be able to achieve growth while at the same time transfer the cost of operation to the franchisee.

5.4.4 Corporate social responsibility

The hotel’s management team should consider improving its effectiveness with regard to environmental and social sustainability by developing a corporate social responsibility programme focusing on the two areas. With regard to environmental sustainability, Travelodge should encourage the society to adopt practices that do not contribute to environmental pollution (Bruns-Smith et al, 2015).

 One of t he approaches through which the firm can achieve this is encouraging consumers to adopt effective waste disposal practices (Park, Choi & Kim, 2012). Moreover, the firm should consider establishing a foundation that will directly contribute to elimination of the social challenges in the society such as poverty eradication. This approach will strengthen the hotel’s reputation and image. Subsequently, the hotel will become increasingly acceptable within the society.

 

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