Internal Analysis of Intercontinental Hotels Group
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AI Summary
This essay presents a reflective analysis of the internal business environment of Intercontinental Hotels Group (IHG), a well-renowned chain of hotels. It discusses the value chain model, the internal environment of IHG, and the usefulness of the value chain model. The essay also explores the primary and secondary activities of IHG's value chain and reflects on the application of the value chain model in understanding the internal environment of IHG.
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Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
Value Chain Model.................................................................................................................1
Intercontinental Hotels Group................................................................................................2
Internal Environment..............................................................................................................2
Reflection on Value Chain Model..........................................................................................5
CONCLUSION................................................................................................................................5
REFERENCES................................................................................................................................7
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
Value Chain Model.................................................................................................................1
Intercontinental Hotels Group................................................................................................2
Internal Environment..............................................................................................................2
Reflection on Value Chain Model..........................................................................................5
CONCLUSION................................................................................................................................5
REFERENCES................................................................................................................................7
INTRODUCTION
Business environment can be referred to as the amalgamation of internal as well as
external factors of atmosphere within the confines of which a company carries out its corporate
operations (Waithanji and et. al., 2015). The aim of this essay is to present a reflective analysis
of the internal business environment of a company. The organisation considered for doing this
analysis is Intercontinental Hotel Group (IHG) which is a well renowned and established chain
of hotels functioning within hospitality industry. The report consists of overview of Value Chain
together with in depth analysis of internal environment of company. Also, it encompasses
reflection of its usefulness of Value Chain Model.
MAIN BODY
Value Chain Model
It can be referred to as the integration of a number of business activities which an
organisation undergoes in a bid to ensure effective product and service delivery at market place
(Jordan and Kapoor, 2016). Additionally, this framework is particularly fundamental so as to
suitably and viably make value inside the organization. The grounds on which the before
mentioned thing can be stated is that it straightforwardly illustrates the growth and development
of the firm. In this relation, it is ascertained that greater value upgrades the efficiency as well as
effectiveness of firm within the market place. Besides this, value chain also provides assistance
to an entity in attainment of strategic and competitive edge over the rival firms.
One of the most important contributions to business management was given by Michael
Porter when the idea of value chain was first coined. VCM devised by Porter is one of the most
prominent frameworks that assists an enterprise in presenting the internal analysis of firm. A
somewhat homogeneous presentation has been given inside this model of primary and secondary
activities which are quite usual within the confines of companies, irrespective of the industry
within which the enterprise operates. The accumulation of primary and secondary activities
together form the foundation upon which the goodwill as well as market standing of a company
is dependent. This results in effective accomplishment of corporate goals as well as objectives in
due course of time.
One of the greatest merits of VCM is the approach held by this model. Hereby, the
integration of business systems takes place that tends to have a significant influence on the cost
1
Business environment can be referred to as the amalgamation of internal as well as
external factors of atmosphere within the confines of which a company carries out its corporate
operations (Waithanji and et. al., 2015). The aim of this essay is to present a reflective analysis
of the internal business environment of a company. The organisation considered for doing this
analysis is Intercontinental Hotel Group (IHG) which is a well renowned and established chain
of hotels functioning within hospitality industry. The report consists of overview of Value Chain
together with in depth analysis of internal environment of company. Also, it encompasses
reflection of its usefulness of Value Chain Model.
MAIN BODY
Value Chain Model
It can be referred to as the integration of a number of business activities which an
organisation undergoes in a bid to ensure effective product and service delivery at market place
(Jordan and Kapoor, 2016). Additionally, this framework is particularly fundamental so as to
suitably and viably make value inside the organization. The grounds on which the before
mentioned thing can be stated is that it straightforwardly illustrates the growth and development
of the firm. In this relation, it is ascertained that greater value upgrades the efficiency as well as
effectiveness of firm within the market place. Besides this, value chain also provides assistance
to an entity in attainment of strategic and competitive edge over the rival firms.
One of the most important contributions to business management was given by Michael
Porter when the idea of value chain was first coined. VCM devised by Porter is one of the most
prominent frameworks that assists an enterprise in presenting the internal analysis of firm. A
somewhat homogeneous presentation has been given inside this model of primary and secondary
activities which are quite usual within the confines of companies, irrespective of the industry
within which the enterprise operates. The accumulation of primary and secondary activities
together form the foundation upon which the goodwill as well as market standing of a company
is dependent. This results in effective accomplishment of corporate goals as well as objectives in
due course of time.
One of the greatest merits of VCM is the approach held by this model. Hereby, the
integration of business systems takes place that tends to have a significant influence on the cost
1
along with profitability. This clearly indicates the sources through which firm creates value.
Also, it aids in identification of such resources on which an adverse influence is placed by the
current performance of company. Thus, it is regarded as an effectual framework which takes into
account the overall working of a firm as well as the aspects that provide assistance to a
corporation with respect to creation of value.
Intercontinental Hotels Group
IHG is a globally renowned business association that is engaged in arrangements related
to boarding and lodging, accommodation, F&B, conferencing & banqueting etc. It is functioning
within the confines of hospitality industry of United Kingdom. In addition to this, the firm has a
compelling existence within approximately 110 countries, whereby it possesses a few brands
which give significant contribution in improving the growth and development of this endeavour.
This entity was established in the year 2003 and has earned massive goodwill across United
Kingdom and at international scale.
As identified on the basis of mission and vision of firm, it can be said that value within
the confines of IHG is created by way of provision of hospitality facilities (De Jong and et. al.,
2017). In addition to this, entity exercises flexible systems related to catering to diverse cultural
individuals. This hospitality organisation emphasizes upon innovation and differentiation to gain
edge at market place. The firm includes boutiques within its chain of hotels to appeal to large
number of individuals and retain them for a long period of time.
Internal Environment
It is important for an organisation to evaluate the internal environment by making use of
value chain model as this covers relevant operations as well as system of firm that are mandatory
for attainment of their objectives that primarily comprises of profitability and sales (Folmer,
2016). Thus with reference to Intercontinental Hotels Group, the value chain model comprises of
primary and supporting activities, they have been specified beneath:
Primary Activities
Inbound Logistics
Within these activities, organisation tends to formulate effectual as well as stronger
relationship among their suppliers as their support is essential for organisation while rendering
their services. An instance can be taken into consideration such as within Intercontinental Hotels
Group needs to acquire, store and deliver their offerings. With respect to firm, they have
2
Also, it aids in identification of such resources on which an adverse influence is placed by the
current performance of company. Thus, it is regarded as an effectual framework which takes into
account the overall working of a firm as well as the aspects that provide assistance to a
corporation with respect to creation of value.
Intercontinental Hotels Group
IHG is a globally renowned business association that is engaged in arrangements related
to boarding and lodging, accommodation, F&B, conferencing & banqueting etc. It is functioning
within the confines of hospitality industry of United Kingdom. In addition to this, the firm has a
compelling existence within approximately 110 countries, whereby it possesses a few brands
which give significant contribution in improving the growth and development of this endeavour.
This entity was established in the year 2003 and has earned massive goodwill across United
Kingdom and at international scale.
As identified on the basis of mission and vision of firm, it can be said that value within
the confines of IHG is created by way of provision of hospitality facilities (De Jong and et. al.,
2017). In addition to this, entity exercises flexible systems related to catering to diverse cultural
individuals. This hospitality organisation emphasizes upon innovation and differentiation to gain
edge at market place. The firm includes boutiques within its chain of hotels to appeal to large
number of individuals and retain them for a long period of time.
Internal Environment
It is important for an organisation to evaluate the internal environment by making use of
value chain model as this covers relevant operations as well as system of firm that are mandatory
for attainment of their objectives that primarily comprises of profitability and sales (Folmer,
2016). Thus with reference to Intercontinental Hotels Group, the value chain model comprises of
primary and supporting activities, they have been specified beneath:
Primary Activities
Inbound Logistics
Within these activities, organisation tends to formulate effectual as well as stronger
relationship among their suppliers as their support is essential for organisation while rendering
their services. An instance can be taken into consideration such as within Intercontinental Hotels
Group needs to acquire, store and deliver their offerings. With respect to firm, they have
2
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contractual suppliers which are present around the United Kingdom for their multiple hotels that
are liable for delivering raw vegetables & fruits, beverages and laundry services for organisation.
Apart from this, organisation has house storage along with distribution functions in different
departments of firm and is also responsible for controlling inventory.
Operations
The activities in Intercontinental Hotels Group comprise of food production, testing,
packaging and delivery of the services. The other key operational activity in organisation is
associated with maintaining as well as repairing of equipments and machineries (Josserand and
Kaine, 2016). The organisation is effectively and appropriately managing operation by acquiring
these entities which will enable the organisation within innovation and carrying out their
operations through minimised wastage and impelling outcomes.
Outbound Logistics
These actions are comprehensive for processing of orders, preparation of reports and
storage of food. As the firm need to acquire food items on daily basis, it is important that firm
has adequate storage facilities along with controlled temperature so that food can be kept fresh.
This will enable Intercontinental Hotels Group to serve their customers with fresh food and
thereby maintaining quality of food. For carrying out ordering processing, the firm has
automated as well as digitally transformed systems for mobile applications as well as websites.
This will aid them within tracking of of orders along with processing of orders in effectual and
prominent way.
Marketing and Sales
These operations are exclusive for communicating the services of hotels to their
customers in a spectacular way. In context of Intercontinental Hotels Group, the firm emphasise
on marketing of differentiated services as well as products to their customers that are made
available at reasonable costing along with high quality (Kolk, 2016). To carry out the same, firm
makes use of advertising by usage of promotions, social media, building effectual relationships
and sales agents through prominent channels and many others. This assists them to market their
accommodation and food services by selling them to their target customers.
Service
This is comprehensive for carrying out pre-sales and post-sale services for their
consumers. With respect to former, the organisation can grab attention of their customers by
3
are liable for delivering raw vegetables & fruits, beverages and laundry services for organisation.
Apart from this, organisation has house storage along with distribution functions in different
departments of firm and is also responsible for controlling inventory.
Operations
The activities in Intercontinental Hotels Group comprise of food production, testing,
packaging and delivery of the services. The other key operational activity in organisation is
associated with maintaining as well as repairing of equipments and machineries (Josserand and
Kaine, 2016). The organisation is effectively and appropriately managing operation by acquiring
these entities which will enable the organisation within innovation and carrying out their
operations through minimised wastage and impelling outcomes.
Outbound Logistics
These actions are comprehensive for processing of orders, preparation of reports and
storage of food. As the firm need to acquire food items on daily basis, it is important that firm
has adequate storage facilities along with controlled temperature so that food can be kept fresh.
This will enable Intercontinental Hotels Group to serve their customers with fresh food and
thereby maintaining quality of food. For carrying out ordering processing, the firm has
automated as well as digitally transformed systems for mobile applications as well as websites.
This will aid them within tracking of of orders along with processing of orders in effectual and
prominent way.
Marketing and Sales
These operations are exclusive for communicating the services of hotels to their
customers in a spectacular way. In context of Intercontinental Hotels Group, the firm emphasise
on marketing of differentiated services as well as products to their customers that are made
available at reasonable costing along with high quality (Kolk, 2016). To carry out the same, firm
makes use of advertising by usage of promotions, social media, building effectual relationships
and sales agents through prominent channels and many others. This assists them to market their
accommodation and food services by selling them to their target customers.
Service
This is comprehensive for carrying out pre-sales and post-sale services for their
consumers. With respect to former, the organisation can grab attention of their customers by
3
engaging them within effectual interaction related with services that are being anticipated from
the organisation. Along with this, they acquire information related with requirements and queries
of customers with respect to ways in which firm acts on specified sales of time. Furthermore, for
carrying out post-sales services, customer relationship management is directed for acquisition of
reviews from their customers by furnishing them with discounts and offers on prominent location
which will enable them to make sure their engagement in Intercontinental Hotels Group.
Secondary Activities
Infrastructure
It has been determined that in context with infrastructure, organisation adequately
manages their functions related to legal matters, finance, accounting along with planning
activities (Albert and Grzeda, 2015). For this organisation hire human resources, technical and
financial executive in order to develop strategies so as to determine the manner in which entity
infrastructure can be significantly improved and further help to gain more competitive
advancements.
Human Resource Management
Human resource management is mainly related to the efficient and effective management
of workforce within an organisation. For example the entity offer training and development
courses to their employees with the help of which they can enhance their daily basis
performance. In addition to this organisation also offer attractive reward and motivational
measures to their employees in order to retain them for long period of time.
Technological Development
It has been identified that hospitality industry is one of the fastest and growing industries all
over the world thus with the implementation of technological advanced tool and techniques
formative support to the organisations has been gained in order to perform their operations in a
well defined manner while satisfying customers at it best. In relation with organisation
implementation of artificial intelligence is being undertaken as to track, measure and make
significant reduction in food wastage (Bi, Davison and Smyrnios, 2017). In addition to this
advanced technologies like Winnow Vision AI help entity to make reduction of 30% of food
wastage along with effective management of logistics and operations of company in well defined
manner.
Procurement
4
the organisation. Along with this, they acquire information related with requirements and queries
of customers with respect to ways in which firm acts on specified sales of time. Furthermore, for
carrying out post-sales services, customer relationship management is directed for acquisition of
reviews from their customers by furnishing them with discounts and offers on prominent location
which will enable them to make sure their engagement in Intercontinental Hotels Group.
Secondary Activities
Infrastructure
It has been determined that in context with infrastructure, organisation adequately
manages their functions related to legal matters, finance, accounting along with planning
activities (Albert and Grzeda, 2015). For this organisation hire human resources, technical and
financial executive in order to develop strategies so as to determine the manner in which entity
infrastructure can be significantly improved and further help to gain more competitive
advancements.
Human Resource Management
Human resource management is mainly related to the efficient and effective management
of workforce within an organisation. For example the entity offer training and development
courses to their employees with the help of which they can enhance their daily basis
performance. In addition to this organisation also offer attractive reward and motivational
measures to their employees in order to retain them for long period of time.
Technological Development
It has been identified that hospitality industry is one of the fastest and growing industries all
over the world thus with the implementation of technological advanced tool and techniques
formative support to the organisations has been gained in order to perform their operations in a
well defined manner while satisfying customers at it best. In relation with organisation
implementation of artificial intelligence is being undertaken as to track, measure and make
significant reduction in food wastage (Bi, Davison and Smyrnios, 2017). In addition to this
advanced technologies like Winnow Vision AI help entity to make reduction of 30% of food
wastage along with effective management of logistics and operations of company in well defined
manner.
Procurement
4
Procurement is related with purchasing of equipments, raw materials and supplies which
is essential for the production of food. For this organisation take advantage of strategic planning
as well as supply chain management in order to effectively conduct their process and manage
resources according to the need and demand.
Reflection on Value Chain Model
In order effectively manage all the activities within an organisation company take
advantage of value chain model as manage their internal environment with the help of this,
company can effectively able to operate there every function in a well define manner.
Value chain model effectively aid me in relation with effective evaluation of the manner
in which Intercontinental Hotel groups can ensure more competitive advancements. This has
been identified that with the help of this module, I can effectively be able to evaluate the
organisation current operations which is related to providing effective services and gaining more
competitive advantage.
In addition to this it also aid me in the formative evaluation of the value which is created
by entity operations. For instance it has been identified that Intercontinental hotel group
effectively manage their functions related to logistics, marketing activities, creation of value
operation and services in best effective manner along with in cost effective way.
Further this has been identifying that with the help of value chain model Intercontinental
Hotel groups effectively conduct their activities related to procurement and supply chain
management. It also helps them to manage their internal environment activities such as resource
management and other function with the help of which effective satisfaction to customers can be
offered. Value chain model effectively aid entity to manage human resource management along
with other Logistic functions in well define manner and further accomplished business
performance at great extent. Thus, it has been identified that value chain model effectively
benefit me to understand Intercontinental Hotel groups internal environment.
CONCLUSION
On the basis of above discussion, it can be said that it is important for a firm to take into
account its internal environment on a regular basis so as identify its strengths and shortcomings.
Further, it is acknowledged that Value Chain model consisting of primary as well as secondary
activities is taken into use by companies across the globe in order to carry out effective internal
5
is essential for the production of food. For this organisation take advantage of strategic planning
as well as supply chain management in order to effectively conduct their process and manage
resources according to the need and demand.
Reflection on Value Chain Model
In order effectively manage all the activities within an organisation company take
advantage of value chain model as manage their internal environment with the help of this,
company can effectively able to operate there every function in a well define manner.
Value chain model effectively aid me in relation with effective evaluation of the manner
in which Intercontinental Hotel groups can ensure more competitive advancements. This has
been identified that with the help of this module, I can effectively be able to evaluate the
organisation current operations which is related to providing effective services and gaining more
competitive advantage.
In addition to this it also aid me in the formative evaluation of the value which is created
by entity operations. For instance it has been identified that Intercontinental hotel group
effectively manage their functions related to logistics, marketing activities, creation of value
operation and services in best effective manner along with in cost effective way.
Further this has been identifying that with the help of value chain model Intercontinental
Hotel groups effectively conduct their activities related to procurement and supply chain
management. It also helps them to manage their internal environment activities such as resource
management and other function with the help of which effective satisfaction to customers can be
offered. Value chain model effectively aid entity to manage human resource management along
with other Logistic functions in well define manner and further accomplished business
performance at great extent. Thus, it has been identified that value chain model effectively
benefit me to understand Intercontinental Hotel groups internal environment.
CONCLUSION
On the basis of above discussion, it can be said that it is important for a firm to take into
account its internal environment on a regular basis so as identify its strengths and shortcomings.
Further, it is acknowledged that Value Chain model consisting of primary as well as secondary
activities is taken into use by companies across the globe in order to carry out effective internal
5
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analysis. This framework allows firms to generate value by executing primary and support
activities as per organisational requirements such that a company can get ahead of rival firms
present in same industry.
6
activities as per organisational requirements such that a company can get ahead of rival firms
present in same industry.
6
REFERENCES
Books & Journals
Albert, S. and Grzeda, M., 2015. Reflection in strategic management education. Journal of
Management Education. 39(5). pp.650-669.
Bi, R., Davison, R.M. and Smyrnios, K.X., 2017. E-business and fast growth SMEs. Small
Business Economics. 48(3). pp.559-576.
De Jong, J., and et. al., 2017. Instruments of value: using the analytic tools of public value theory
in teaching and practice. Public Management Review. 19(5). pp.605-620.
Folmer, B. ed., 2016. The craft and science of coffee. Academic Press.
Jordan, S. and Kapoor, D., 2016. Re-politicizing participatory action research: unmasking
neoliberalism and the illusions of participation. Educational Action Research. 24(1).
pp.134-149.
Josserand, E. and Kaine, S., 2016. Labour standards in global value chains: Disentangling
workers’ voice, vicarious voice, power relations, and regulation. Relations
industrielles/Industrial Relations. 71(4). pp.741-767.
Kolk, A., 2016. The social responsibility of international business: From ethics and the
environment to CSR and sustainable development. Journal of World Business. 51(1).
pp.23-34.
Waithanji, E. and et. al., 2015. A gendered analysis of goat ownership and marketing in Meru,
Kenya. Development in Practice. 25(2). pp.188-203.
7
Books & Journals
Albert, S. and Grzeda, M., 2015. Reflection in strategic management education. Journal of
Management Education. 39(5). pp.650-669.
Bi, R., Davison, R.M. and Smyrnios, K.X., 2017. E-business and fast growth SMEs. Small
Business Economics. 48(3). pp.559-576.
De Jong, J., and et. al., 2017. Instruments of value: using the analytic tools of public value theory
in teaching and practice. Public Management Review. 19(5). pp.605-620.
Folmer, B. ed., 2016. The craft and science of coffee. Academic Press.
Jordan, S. and Kapoor, D., 2016. Re-politicizing participatory action research: unmasking
neoliberalism and the illusions of participation. Educational Action Research. 24(1).
pp.134-149.
Josserand, E. and Kaine, S., 2016. Labour standards in global value chains: Disentangling
workers’ voice, vicarious voice, power relations, and regulation. Relations
industrielles/Industrial Relations. 71(4). pp.741-767.
Kolk, A., 2016. The social responsibility of international business: From ethics and the
environment to CSR and sustainable development. Journal of World Business. 51(1).
pp.23-34.
Waithanji, E. and et. al., 2015. A gendered analysis of goat ownership and marketing in Meru,
Kenya. Development in Practice. 25(2). pp.188-203.
7
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