Terry Stevens says we should not be afraid of backing destination winners to boost the industry’s potential
In 2011 I contributed an article to the IWA’s journal the welsh agenda on the long term malaise affecting the tourism industry in Wales. It painted a picture of an industry that, despite showing global growth and predicted increases of over 3 per cent per annum in Europe was, actually, stagnating in Wales.
Something had to be done to reverse this trend. Best practice and evidence from around the world was demonstrating how other countries had been successful in turning around similar situations. Good examples in Europe included the revival of tourism in Switzerland, Austria and Croatia.
Edwina Hart, Minister for Economy, Science and Transport has recognised that a fresh approach is needed. In her introduction to her Strategy for Tourism 2013 -2020: Partnership for Growth she stresses that the Welsh tourism industry has to prioritise product development, focus on key markets and sharpen our marketing efforts.
Key factors directly affecting our ability to compete effectively are now being tackled with purpose, including: developing Cardiff Wales Airport, establishing a convention centre and arena in south east Wales, as well as addressing the issue of how markets perceive Wales and creating initiatives to tackle the all important need to improve our service culture.
The new Strategy has set a target to grow the value of tourism in Wales from its current worth of £4.5 billion a year (£2.5billion Gross Value Added) by at least 10 per cent by 2020. This is a realistic target. If it is not achieved it will be a statement of a collective failure to respond to opportunities created by the demands of modern tourism markets.
Edwina Hart’s strategy identifies five key areas that will be the focus for change:
Promotion of the brand – we await the results of this review which is due to be made public this Autumn.
Product development – prioritising investment in high quality, reputation changing products and events.
People development – supporting greater professionalism in the industry.
Profitable performance – developing profitability through better management and applied technologies.
Place building – creating, managing and marketing destinations that people want to visit.
This all makes a great deal of sense. The most important and most challenging of these new priorities has to be ‘place building’ – the essential job of successful destination development.
Creating competitive, well managed and marketed destinations is the essential ingredient for success. This is now recognised by the UN World Tourism Organisation. In November 2012 the World Travel and Tourism Council published The Economic Advantages of Travel and Tourism in which it stated, “the case for the destination is simple… competition demands it”.
In his book The Economics of Tourist Destinations, published in 2005, Professor Norbert van Hove also makes the case for the destination:
“The fundamental product in tourism is the destination experience. Competition, therefore, is centred on the destination. For most tourists this experience takes place in a rather small geographical area. This is an entity which, from a tourism management point of view, is managerial.”
This means that, in Wales, we now have to tackle the structure and organisation of tourism at the destination level if we are to achieve the ambitions for growth. We must identify and focus our efforts on a limited number of leading destinations that are most likely to be able to deliver the new tourism vision for Wales. This is exactly what has happened in Scotland, Denmark, Austria and Switzerland to great effect.
We must not be afraid of backing winners. That means prioritisation and a process that inevitably leads to some casualties. However, ‘rising tides do lift every boat’.
Strong and successful destinations need competent destination management organisations (DMOs). This is where we face the biggest challenge. It is in this respect that we can learn more from our competitors. How have they created destination management organisations that are dynamic, market focused and, in the words of the Minister, “…work with agility and a common purpose”?
In this respect, the key lessons from our competitors include:
Public/private partnerships are, of course important, but successful destination management organisations are private sector led and managerial in approach. Ken Robinson, one of the leading strategic influencers in tourism in the UK has recently stated that, “Tourism growth (and competitiveness) needs much more than marketing but few existing destinations in the UK have embraced tourism management. DMOs must cover tourism management and be private sector led.”
Strong leadership is essential to deliver vision and strategy at the destination level.
Destination leadership must involve the leading brands and businesses that represent the destination and the brand positioning for country.
The vision and strategy must delivers tourism that meets the needs of the modern tourist and respects community interests, values and capacity;
The approach taken is fuelled by hybrid thinking that nurtures innovation and creativity.
Over the past 25 year my company, Stevens & Associates, has worked developing tourism strategies in over 40 countries around the world. We have analysed ‘what makes a great destination’ – one that consistently outperform other places in the world. Our conclusions are that, from Istria in Croatia to Summit County in Utah, and from Gorenjska in Slovenia to Turku in Finland, their successful DMOs all had a similar organisational structure.
These destinations are carefully selected by their Governments as ‘hot spots of tourism’. They are the leading destinations in their respective territories, places where tourism growth will make a real impact.
Three anecdotal comments from leaders in these DMOs stand out as tenets that we should seriously reflect upon:
Ignore anyone who says I do it this way…. it is about partnership and collective effort.
Ignore anyone who speaks in a past tense, for example saying, We tried that, or We used to do it this way…. we need fresh, new, voices.
Don’t ask what the organisation can do for you; rather, ask what you can do for the destination…. a strategic approach is essential.
Involve and engage industry leaders…. leadership is vital.
Myles Rademan, the inspirational former Director of PR and Leadership for tourism in Utah’s Park City, acknowledges that these ‘principles’ can be difficult for many who have enjoyed a comfortable but ineffectual role in tourism in the past. However, he is adamant that strategically focused leadership is essential if often unpalatable. As he puts it, “If the moon listened to all the dogs that barked it wouldn’t rise each night”.
At present our tourism organisations are dominated by risk averse, non market focused public bodies with local authorities often ‘leading’ the development of destination tourism strategies and marketing. Where the private sector is involved it is all too often represented by operators who demonstrate little understanding of the need for vision, strategy and destination brand management.
As a result, the tourism industry in Wales at the destination level is characterised by a distinct lack of informed and dynamic leadership able to deliver innovation and creativity. This has got to change. And it now appears we are, at long last, plotting a new course.
The new direction, being led by the Minister, Edwina Hart, demands a mature response from the private sector. She has laid down a challenge to grow the value of tourism. We need the industry to respond positively. We need industry leaders to be prepared ‘step up to the plate’.
The public sector must also accept change in the way it is involved in tourism. Local authorities must continue to be strong partners but they need to stand back from their current dominant position and allow new structures, alliances and ways of working to flourish.
This has successfully been achieved in Bournemouth (with the establishment of a Bournemouth Tourism Management Board) and in its near neighbour, Poole, where the local authority has led the change in approach. So it can be done.
We need to shift to a culture where icons and drivers of tourism lead and receptors, or beneficiaries, of tourism take more of a back seat. This means the involvement of true industry leaders and even (shock, horror!) people from outside the tourism industry.
Do we have the appetite and the hunger to do things differently? If we don’t more of the same will simply deliver more of the same which has not served us well over the past 20 years.
We need a new way of working to deliver the Government’s strategy for growth. The Minister has clearly set out her stall. The industry must now respond positively to her challenge.