Program Web Address
In their dialogue entitled - The Food Service Industry Environment: Market Volatility Analysis - by Alex F. De Noble, Assistant Professor of Management, San Diego State University and Michael D. Olsen, Associate Professor and Director, Division of Hotel, Restaurant & Institutional Management at Virginia Polytechnic Institute and State University, De Noble and Olson preface the discussion by saying: “Hospitality executives, as a whole, do not believe they exist in a volatile environment and spend little time or effort in assessing how current and future activity in the environment will affect their success or failure. The authors highlight potential differences that may exist between executives' perceptions and objective indicators of environmental volatility within the hospitality industry and suggest that executives change these perceptions by incorporating the assumption of a much more dynamic environment into their future strategic planning efforts. Objective, empirical evidence of the dynamic nature of the hospitality environment is presented and compared to several studies pertaining to environmental perceptions of the industry.”
That weighty thesis statement presumes that hospitality executives/managers do not fully comprehend the environment in which they operate. The authors provide a contrast, which conventional wisdom would seem to support and satisfy.
“Broadly speaking, the operating environment of an organization is represented by its task domain,” say the authors. “This task domain consists of such elements as a firm's customers, suppliers, competitors, and regulatory groups.” These are dynamic actors and the underpinnings of change, say the authors by way of citation.
“The most difficult aspect for management in this regard tends to be the development of a proper definition of the environment of their particular firm. Being able to precisely define who the customers, competitors, suppliers, and regulatory groups are within the environment of the firm is no easy task, yet is imperative if proper planning is to occur,” De Noble and Olson further contribute to support their thesis statement.
The article is bloated, and that’s not necessarily a bad thing, with tables both survey and empirically driven, to illustrate market volatility.
One such table is the Bates and Eldredge outline; Table-6 in the article. “This comprehensive outline…should prove to be useful to most executives in expanding their perception of the environment of their firm,” say De Noble and Olson. “It is, however, only a suggested outline,” they advise.
“…risk should be incorporated into every investment decision, especially in a volatile environment,” say the authors.
De Noble and Olson close with an intriguing formula to gauge volatility in an environment.
De Noble, Alex F. and Olsen, Michael D.
"The Food Service Industry Environment: Market Volatility Analysis,"
Hospitality Review: Vol. 4
, Article 10.
Available at: http://digitalcommons.fiu.edu/hospitalityreview/vol4/iss2/10