Like many other industries, the travel industry is under increasing pr

Question

Like many other industries, the travel industry is under increasing pressure to expand globally in order to keep pace with its corporate customers, who have globalized their operations in response to market pressure, competitor actions, and changing supplier relations. But it is difficult for service organizations to globalize. Global expansion through acquisition is usually expensive, and expansion through internal growth is time-consuming and sometimes impossible in markets that are not actively growing. Some service industry companies, in fact, regard these traditional routes to global expansion as inappropriate for service industries because of their special need to preserve local responsiveness through local presence and expertise. One travel agency has eschewed the traditional route altogether. A survivor of the changes that swept the travel industry as a result of the deregulation of the airlines in 1978—changes that included dramatic growth in the corporate demand for travel services, as well as extensive restructuring and consolidation within the travel industry—this agency adopted a unique structure for globalization. Rather than expand by attempting to develop its own offices abroad, which would require the development of local travel management expertise sufficient to capture foreign markets, the company solved its globalization dilemma effectively by forging alliances with the best foreign partners it could find. The resulting cooperative alliance of independent agencies now comprises 32 partners spanning 37 countries.   1 
 E 
 1. The passage suggests that one of the effects of the deregulation of the airlines was

A. a decline in the services available to noncommercial travelers
B. a decrease in the size of the corporate travel market
C. a sharp increase in the number of cooperative alliances among travel agencies
D. increased competition in a number of different service industries
E. the merging of some companies within the travel industry

2 
 C 
 2. The author discusses a particular travel agency in the passage most likely in order to

(A) provide evidence of the pressures on the travel industry to globalize
(B) demonstrate the limitations of the traditional routes to global expansion
(C) illustrate an unusual approach to globalizing a service organization
(D) highlight the difficulties confronting travel agencies that attempt to globalize
(E) underscore the differences between the service industry and other industries

3 
 D 
 3. According to the passage, which of the following is true of the traditional routes to global expansion?

(A) They have been supplanted in most service industries by alternative routes.
(B) They are less attractive to travel agencies since deregulation of the airlines.
(C) They may represent the most cost-effective means for a travel agency to globalize.
(D) They may be unsuitable for service agencies that are attempting to globalize.
(E) They are most likely to succeed in markets that are not actively growing.

urfrndniks · Accepted Answer

1)A. a decline in the services available to non-commercial travellers … non-commercial
travellers is not a part of the passage and thus not verified … ‘decline in services’ is
not inferable.
B. a decrease in the size of the corporate travel market … the passage makes no comment
on changes (if any) in the travel market size.
C. a sharp increase in the number of cooperative alliances among travel agencies … sharp
increase is a bit on the extreme side … the dramatic growth mentioned in line 19 is of
the demand for travel services … the cooperative alliance stated in the passage
pertains to ONE single agency … it is unwarranted to conclude that all agencies
followed suit.
D. increased competition in a number of different service industries … the deregulation is
linked with the travel industry … this answer choice goes general to say competition
(also something NOT mentioned) increased in a number of service industries …
specific to general error.
E. the merging of some companies within the travel industry … lines 26 – 29 confirm that
this is exactly what happened … it is by way of mergers and co-operative alliances
that the ONE agency survived … CORRECT

2)A. provide evidence of the pressures on the travel industry to globalize … the author’s
primary purpose in the passage is to bring to light the scenario adopted by the ONE
travel agency not to prove that there indeed were pressures … the pressures are
mentioned only as a factor leading to the need to globalize.
B. demonstrate the limitations of the traditional routes to global expansion … to
demonstrate means to illustrate with examples … the limitations of the traditional
route to globalization are never illustrated upon in the passage.
C. illustrate an unusual approach to globalizing a service organization … the answer
matches exactly with what lines 19 – 20 have to say … CORRECT.
D. highlight the difficulties confronting travel agencies that attempt to globalize … the
difficulties confronting the travel agency are mentioned in the passage, however, the
author never highlights them.
E. underscore the differences between the service industry and other industries …
services industries are never compared with the rest of the industries in the passage
… they’re only both mentioned to be under the pressure to globalize … the word
differences is not verified.

3)A. They have been supplanted in most (Avoid Superlatives) service industries by
alternative routes … the only alternative route mentioned is the one in the example in
the end … routes is not verified.
B. They are less attractive to travel agencies since deregulation of the airlines … the
passage never mentions anything about the appeal having gone down after the
deregulation happened
C. They may represent the most (Avoid Superlatives) cost-effective means for a travel
agency to globalize … traditional routes were something service industries (including
the travel) were avoiding … 180 degrees answer.
D. They may be unsuitable for service agencies that are attempting to globalize … this is an
exact word to word match of what is said in lines 10 – 15 … CORRECT.
E. They are most (Avoid Superlatives) likely to succeed in markets that are not actively
growing … markets that are not actively growing make it impossible for internal
growth (one of the traditional routes) – lines 7 – 10 … 180 degrees answer.

thevenus · Answer

Let's magnify;

"..... the company solved its globalization
dilemma effectively by forging alliances with the best
foreign partners it could find."

Best foreign partners - belongs to industries in same industry AND few companies those are the best.

Hold (E)

(C) a sharp increase in the number of cooperative alliances among   travel agencies 
 not all companies are best so merger can not be sharp
its is talking about "travel agency " travel agencies are / can be local bodies and doesn't have much impact to such a vast level of deregulations.

Hope this helps !

akrish1982 · Answer

as the question asks for effects of deregulation, went and read this:

A survivor of the  changes
that swept the travel industry  as a result of the
deregulation of the airlines in 1978—changes that
 included dramatic growth in the corporate demand for
travel services , as well as  extensive restructuring and
consolidation within the travel industry —this agency
adopted a unique structure for globalization

the bold portions were the effects as per the para. consolidation within the travel industry was taken by me to mean some company bought other companies or companies merged. So, I chose E

TGC · Answer

Can any one shower light on how to prefer (E) over (C) in Q1

C. a sharp increase in the number of cooperative alliances among travel agencies

E. the merging of some companies within the travel industry

saraafifiahmed · Answer

Hi All, Can any body explain why D is the answer for the third question :

3)According to the passage, which of the following is
true of the traditional routes to global expansion?
A. They have been supplanted in most service
industries by alternative routes.
B. They are less attractive to travel agencies since
deregulation of the airlines.
C. They may represent the most cost-effective means
for a travel agency to globalize.
 D. They may be unsuitable for service agencies that
are attempting to globalize. 
E. They are most likely to succeed in markets that are
not actively growing.

Thanks.

Amit0507 · Answer

E talks about consolidation within travel industry. C is the outcome of the alternative approach which a survivor applied to overcome deregulation consequences. C is basically a trap as it uses same language as in the paragraph. We find E not relevant because consolidation is addressed as merging.

Skywalker18 · Answer

Took 1 min 40 seconds to read and 4 mins 50 seconds in total 
-The author talks about the challenges faced by travel agencies to globalize
-The author then gives the example of one travel agency that chose a non traditional method of making itself global

1. "as well as extensive restructuring and consolidation within the travel industry"
Answer E

2."One travel agency has eschewed the traditional route altogether."
Answer C

3."But it is difficult for service organizations to globalize."

Answer D

aceGMAT21 · Answer

A survivor of the changes that swept the travel industry as a result of the deregulation of the airlines in 1978—changes that included dramatic growth in the corporate demand for travel services,  as well as extensive restructuring and consolidation within the travel industry —this agency adopted a unique structure for globalization.

1. The passage suggests that  one of the effects of the deregulation of the airlines  was

A. a decline in the services available to noncommercial travelers
B. a decrease in the size of the corporate travel market
C. a sharp increase in the number of cooperative alliances among travel agencies
D. increased competition in a number of different service industries
 E. the merging of some companies within the travel industry

Option E is just a restatement of  extensive restructuring and consolidation within the travel industry .

LordStark · Answer

structure of the passage:
Background
A Difficulty faced by the service organization. 
02 Traditional solutions and their problems.
One possible solution- an example of that solution.

Harsh2111s · Answer

If you got above question wrong,then you must have mis-read the option "E". "the merging of some companies within the travel industry. and not "the merging of some companies with the travel industry. Also option C is too specific. A sharp increase is relative term. increase from 0-100 can be sharp and 0-32 can also be sharp. Hope it helps

SairamRamo · Answer

Took 3minutes 40 seconds for reading and solving
3/3 Correct

1. The passage suggests that one of the effects of the deregulation of the airlines was

Observe lines 14-16, " 1978—changes that included dramatic growth in the corporate demand for travel services, as well as extensive  restructuring and consolidation  within the travel industry"

A. a decline in the services available to non-commercial travelers
B. a decrease in the size of the corporate travel market
C. a sharp increase in the number of cooperative alliances among travel agencies
D. increased competition in a number of different service industries
E. the  merging of some companies within the travel industry  > Correct choice

2. The author discusses a particular travel agency in the passage most likely in order to

Observe lines 8-12, "Some service industry companies,...... special need  to preserve .....xpertise."

Authors intention is to show the challenges of expansion of services industry in contrast to other traditional industries

(A) provide evidence of the pressures on the travel industry to globalize
(B) demonstrate the limitations of the traditional routes to global expansion
(C) illustrate an unusual approach to globalizing a service organization
(D) highlight the difficulties confronting travel agencies that attempt to globalize
(E)  underscore the differences between the service industry and other industries  > Correct choice

3. According to the passage, which of the following is true of the traditional routes to global expansion?

Observe lines 8-12, "Some service industry companies, in fact, regard  these traditional routes to global expansion as inappropriate for service industries  because of their special need"

(A) They have been supplanted in most service industries by alternative routes.
(B) They are less attractive to travel agencies since deregulation of the airlines.
(C) They may represent the most cost-effective means for a travel agency to globalize.
(D) They may be  unsuitable for service agencies  that are attempting to globalize. >> correct choice
(E) They are most likely to succeed in markets that are not actively growing.

sahilgarg2905 · Answer

In question 1:

Even if you don't know that 'consolidation' means 'merging of companies', you still know that the other 4 options cannot be correct.
Guess smartly XD

abhdha72 · Answer

. Some service industry companies, in fact, regard these traditional routes to global expansion as inappropriate for service industries because of their special need to preserve local responsiveness through local presence and expertise. One travel agency has eschewed the traditional route altogether.

This above information made me choose answer B over C in question no. 2. Some experts please tell us why B is preferred over C?

Posted from my mobile device

This above information made me choose answer B over C in question no. 2. Some experts please tell us why B is preferred over C?

Posted from my mobile device

Vaishnavi_2498 · Answer

Skywalker18  In 2nd Question, we are talking about travel Industry in general, then how could C be an answer which talks about service industry "illustrate an unusual approach to globalizing a service organization"? Also subsequent lines in the passage talk about travel industry too - "A survivor of the changes that swept the travel industry as a result of the deregulation of the airlines in 1978......

PeachSnapple1 · Answer

The first question requires some thinking. In the passage, it said [as well as extensive restructuring and consolidation within the travel industry]. I think consolidation can mean two things: either merging among companies, or the action of simplifying a company, i.e. get rid of unproductive departments. So E could be correct if [consolidation] refers to the first meaning. But C cannot be correct either, as it said [a sharp increase in the number of cooperative alliances among travel agencies]. In the passage there is only one travel agency mentioned, so we can't know for sure if the case of that agency is representative.

But if I have to flip the coin, I would pick E.

But if I have to flip the coin, I would pick E.

Like many other industries, the travel industry is under increasing pr

Prep Toolkit

Top 5 GMAT Debrief Videos

615 to 715 in 15 Days (Ria's Strategies)

More than Quant/Verbal Abilities: Speed vs. Accuracy

745 with Only Self-Prep and GMAT Club

From 555 to 765: 210-point Improvement

Perfect 805 Score Debrief by Julia

My Rewards

GMAT Reading Comprehension (RC) Questions

Like many other industries, the travel industry is under increasing pr

Prep Toolkit

615 to 715 in 15 Days (Ria's Strategies)

More than Quant/Verbal Abilities: Speed vs. Accuracy

745 with Only Self-Prep and GMAT Club

From 555 to 765: 210-point Improvement

Perfect 805 Score Debrief by Julia

My Rewards