| The travel service environment is increasingly competitive and profitability depends heavily on the choice of business strategy and the allocation of scarce resources. This study is an analysis of business strategies in seven autonomous regions of a national firm which, for purposes of this study is called Servco Corporate Travel.; The overall purpose of this study was to analyze a number of variables, usually referred to in the literature as strategic variables, which are vital to long-range planning and growth and which are associated with superior and sustainable financial performance in a successful firm. Econometric models were derived using variables that typically reflect characteristics of a successful firm as characterized by Porter in his competitive analyses and that seemed appropriate a priori for the studied corporation.; The study addressed six statistical hypotheses, not stated here, which can be characterized as determining whether appropriate models could be derived to explain levels of financial success for the seven regions jointly and severally, whether the comparisons and contrasts of the models could explain or be explained by differences in region-specific strategies, and whether there might exist an optimal strategy that could be inferred from the region-specific and corporate models.; The data for the study were twenty-eight quarters of observed region-specific and corporate financial variables (endogenous) and selected national/regional economic variables (exogenous). Least squares multiple regression and other statistical techniques formed the analytical basis for the statistical decisions derived. All models were statistically significant with at least ninety-five percent confidence.; Among the most significant findings of the study, it was determined that: (1) Each region had a distinct econometric model which was related to each respective region's strategy for financial success. (2) A major factor governing success at the regional level is the allocation of the override commission. (3) A different algorithm for allocation of the override commission will produce a correspondingly different profitability level for each respective region. (4) Comparing common endogenous variables across the seven region-specific models resulted in three natural groupings of marginal factors (Marginal Model), transition factors (Transition Model), and profit factors (Profit Model), the latter being optimal with respect to profits. (5) Transition and loss factors were identified and found to be important factors as input to the development of business strategies.; Recommendation for further study and for the integration of the study conclusions into management business planning were outlined in the final chapter. |
