Business Report On Merger Of Coach Tour Companies In Outback

Business Report on Merger of Coach Tour Companies Outback Safari Tours and Mainland Express

Outback Safari Tours is a full-service coach company with 25 offices across NSW, QLD, SA, WA, and NT. It offers a variety of multi-day tours, prides itself on excellent service, and maintains a fleet of new coaches capable of carrying 50 passengers. The company primarily generates 75% of its sales through tour operators and travel agents. Mainland Express is a low-cost coach operator with 10 offices in NSW, Vic, ACT, and SA. Its core strengths include low fares, punctuality, city-to-city routes with minimal stops and no overnight stays, and an excellent online booking system. Its fleet consists of coaches capable of carrying 55 passengers. The management teams have decided to merge these companies into Mainland–Safari Tours, retaining all current staff, coaches, tours, and destinations. The existing scheduling is compatible, and the older system at Outback Safari will be integrated into Mainland’s advanced IT system. The merged entity will operate as a premium low-cost carrier, offering low fares with optional paid add-ons such as seating, baggage, meals, WiFi, and carry-on luggage. It will move to low-cost terminals where available, emphasizing online bookings with a 15% service charge when booked via agents or tour operators. The company plans to become highly digital, supporting 24/7 customer service via phone and web, but no face-to-face support.

Management has identified two suitable business processes or solutions to improve this model but has not specified them. The report aims to recommend these solutions, analyze the management decisions, and distinguish between Information Systems (IS) and Information Technology (IT) issues, especially how they influence customer preferences, loyalty, and market expansion. Additionally, it explores strategies for attracting new customers from competitors and potential new services such as waiting lounges, parking, and transfers, with appropriate literature support.

Paper For Above instruction

Introduction

The proposed merger between Outback Safari Tours and Mainland Express signifies a strategic move to consolidate strengths and expand market reach within the competitive coach touring industry. This combined entity aims to leverage Outback Safari's extensive network, diverse tours, and high-quality fleet with Mainland's low-cost, city-to-city operational model and advanced digital infrastructure. The key challenge lies in integrating these distinct business models, operational practices, and customer engagement strategies to create a seamless and appealing experience for a broad customer base. Therefore, this report evaluates the management’s decisions, offers two strategic proposals to enhance business operations using information systems and technology, and explores expansion avenues to capture new markets and improve customer loyalty.

Analysis of Management Decisions

The strategic choices made by management reflect an intent to preserve organizational familiarity while modernizing the operational backbone. Retaining all staff and existing tours minimizes disruption and sustains customer loyalty, yet integration of Outback Safari’s aging system into Mainland’s advanced IT infrastructure appears to be a critical challenge. Literature emphasizes that effective system integration is vital for maintaining service quality and operational efficiency (Byrd & Turner, 2001). However, mismatched systems can cause delays and data inconsistencies, potentially harming customer satisfaction and brand reputation (McAfee et al., 2012). Also, positioning the merged company as a ‘premium low-cost’ service aligns with market segmentation theory, where targeting price-sensitive yet quality-conscious consumers can increase market share (Kotler & Keller, 2016). Moving to low-cost terminals and emphasizing online bookings are consistent with digital transformation trends, which have shown to improve operational agility and customer convenience (Chen et al., 2010). The decision to eliminate face-to-face support further emphasizes cost reduction and digital focus but risks alienating less tech-savvy segments, thus potentially impacting retention (Vellido et al., 2012).

Distinction Between IS and IT Issues

Information Technology (IT) encompasses the hardware, software, networks, and infrastructure enabling data processing (Laudon & Laudon, 2020). In contrast, Information Systems (IS) include the integrated set of components—people, processes, and technology—that collect, process, and distribute information to support decision-making and operational activities. The integration of Outback Safari’s older system into Mainland’s IT infrastructure is an IT issue, primarily concerned with hardware and software compatibility (O'Brien & Marakas, 2011). Conversely, the deployment of customer support platforms, online booking systems, and digital communication channels pertains to IS, impacting customer experience and loyalty management (Turban et al., 2018). Once fully operational, the effective use of IS—such as CRM systems—can enhance customer engagement, retention, and competitive advantage (Payne & Frow, 2013).

Recommended Business Processes and Solutions

First, implementing an integrated Customer Relationship Management (CRM) system is essential. A unified CRM would enable the company to capture comprehensive customer data, preferences, and booking history across all channels, facilitating tailored marketing, loyalty programs, and personalized services (Chen & Popovich, 2003). For example, integrating CRM with online and offline booking systems allows real-time updates, targeted promotions, and improved customer communication. Studies reveal that CRM integration enhances customer satisfaction, loyalty, and revenue growth (Peppard & Ryals, 2007).

Second, adopting a Business Process Management (BPM) system to streamline operations—particularly scheduling, fleet management, and customer service workflows—can significantly reduce costs and enhance efficiency. BPM tools automate routine tasks, optimize resource allocation, and provide analytics for decision-making (Dumas et al., 2013). For instance, automated fleet scheduling based on real-time data improves operational efficiency, reducing delays and maintenance costs. Moreover, BPM facilitates continuous process improvement, which is essential for scaling and adapting in a competitive environment (Hammer, 1996).

Attracting New Customers and Business Opportunities

To attract customers from competitors, the company should leverage digital marketing strategies—including targeted social media campaigns, mobile advertising, and personalized offers—to reach price-sensitive and leisure travelers (Tiago & Veríssimo, 2014). Introducing value-added services such as waiting lounges at key locations, premium parking options, and door-to-door transfers can enhance convenience and comfort, making the brand more appealing (Kapoor & Agarwal, 2017). These ancillary services also open new revenue streams and strengthen customer loyalty by providing a comprehensive travel experience.

Furthermore, developing partnerships with hotels and local transportation providers can facilitate integrated travel packages, appealing to international and domestic tourists seeking seamless experiences (Gretzel & Fesenmaier, 2006). Advanced data analytics, including social listening and predictive modeling, can identify emerging customer preferences and optimize service offerings (Baldi et al., 2018). Integration with ride-hailing services for transfers from home or office can elevate the customer experience and differentiate the company in a crowded market (Cramer et al., 2018).

In conclusion, the merger offers a strategic opportunity to combine strengths and leverage technology for competitive advantage. The recommended implementation of CRM and BPM systems will optimize operations, enhance customer loyalty, and enable personalized engagement. Expanding services and strategic digital marketing will attract new customer segments and diversify revenue streams. A well-informed strategic approach grounded in IS and IT literature will position Mainland–Safari Tours as a resilient and innovative leader in the coach touring industry.

References

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  • Dumas, M., La Rosa, M., Mendling, J., & Reijers, H. A. (2013). Fundamentals of Business Process Management. Springer.
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