Business Environment

This report highlights the major concepts of business environment with the background of Intercontinental Hotel. It includes a PESTLE analysis of the external environment, the importance of effective recruitment and selection process, factors affecting culture, equality and diversity, methods of performance management, and recommendations for improvement.

Business Environment

Table of Contents
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................3
Compile a PESTLE analysis of external environment...........................................................3
TASK 2............................................................................................................................................4
Using examples for hotel industry discuss importance of effective recruitment and selection
process in order to sustain competitive advantage.................................................................4
TASK 3............................................................................................................................................6
Analyse and evaluate principle factors that affect culture, equality and diversity of an
organization............................................................................................................................6
TASK 4............................................................................................................................................8
Identify and describe main methods of performance management utilized by organizations to
ensure targets and achieved and organisation competitive advantage...................................8
TASK 5............................................................................................................................................9
Discuss an outline plan which offers recommendations on issues raised in presentation......9
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................11

INTRODUCTION
Business environment is an essential aspect of business as this is helpful in analysing
external and internal business factors in order to get competitive edge in the marketplace.
Business environment is the collection of internal and external factors which includes customer
needs, government interventions and all the policies which are implemented by business. This
report highlights all the major concepts of business environment with the background of
intercontinental hotel. Intercontinental hotel is a British hotel chain which is having their
business around the globe. They are serving in more than 100 countries and in order to gain
market advantage several factors are analysed by them which are included in this report. (Eling
and Schaper, 2017)
TASK 1
Compile a PESTLE analysis of external environment
PESTLE analysis is a framework which is used for analysing external environment in
order to analyse those factors which may have direct implications on business. This analysis is
essential to be drawn by business as this suggests any alterations and this may help them to draw
distinct edge in marketplace. In the context of intercontinental hotel this analysis is performed as
under:
Political factors: These factors are associated with political conditions of the country as
in context of UK country is facing instability in political conditions due to Brexit. This factor is
having high implication on human resource management of intercontinental hotel as they are
required to frame such human resource policies which can cop up with instable political
conditions and emerge as robust control over the business. Similarly in this factor human
resource department of intercontinental hotel deals their employees in prominent manner as
employee mobility can be increased due to instable political conditions.
Economic factors: These factors are associated with inflation rate, FDI, corporate tax,
unemployment rate and many more factors as these factors are directly related to HR functions.
In this context HR department is having high role in business of intercontinental hotel as HR is

responsible to appoint employees on an appropriate pay scale according to their job role. In the
current crises due to lockdown and Brexit implications, HR managers are having negative impact
as people are not willing to work for nominal wages during the crises. So these factors are having
high implications on intercontinental hotel and they are required to frame smart decisions so that
employees can be highly satisfied and business does not get any monetary harm.
Social factor: These factors are associated with per capita income and taste and preferences of
customer. In the context of intercontinental hotel within this factor HR manager is required to
provide flexible working environment to their employees so that all the employees’ cam work
with high degree of harmony and job satisfaction. On the other hand if manager fails to provide
the same then this may hamper working of intercontinental hotel in negative manner as adversely
impact on market brand image as well. (vom Brocke, Zelt and Schmiedel, 2016)
Technological factors: These factors are associated with using emerging technology in
business. In context of intercontinental hotel the HR department is having role to arrange various
training sessions to their employees so that they can cop up with latest technology in prominent
manner. These factors are having effective role in their decisions regarding arrangement of
tenure of training and development of employees.
Legal factors: These factors are associated with legal framework of the business so as to
avoid any law suits. In the context of intercontinental hotel the HR department is having role to
oversee enforceability of various laws such as employment laws, safety law and many more.
This is helpful for the customers to obtain high satisfaction from services opt from
intercontinental hotel.
Environment factors: These factors are associated with adaptation of environmental laws in the
business so as to minimise harm to earth and eco system. In this context HR department of
intercontinental hotel is having role of using environmental friendly technique in their business
and implementing the same to minimise the harm (Erasmus, Strydom and Rudansky-Kloppers,,
2016).

TASK 2
Using examples for hotel industry discuss importance of effective recruitment and selection
process in order to sustain competitive advantage
Recruitment: This process is termed as approach in which prospective candidates are searched
that can apply for the vacant position in order to fill the same to serve organisation in appropriate
manner. This is helpful for the company to acquire those sources of recruitment so as to fill up
vacant job position. For instance in intercontinental hotel HR manager may search out candidates
with the main purpose to get high edge over competitive edge and sustain in the market by
maintaining performance of their services as effective recruitment procedure is helpful in
enhancing market growth. (Aithal, 2017)
Selection: This is referred as the process in which right candidate is being selected form the pool
of candidates in order to fill vacant job position. Within this process suitable employee is
selected by testing their skills and capabilities at prominent manner. For instance manager of
intercontinental hotel is looking for a candidate for their organisation who is efficient in
communication skills and business skills which is helpful for them to enhance their service
quality and customer interaction due to which high edge on competition can be received by them
in marketplace.
Importance of recruitment and selection
Recruitment and selection are two similar but way different approaches as they both are
used in order to attract appropriate candidate in the business so as to make the company efficient
to enjoy market competitive edge and sustainability for long term by which high profits can be
earned.
Increase profitability and performance: The most essential significance of effective
recruitment process is to enhance organisational performance in considerable manner. In order to
enhance profitability of business candidates are hired on various time and pay scale and those are
rewarded for their extra ordinary performance that could be a major reason for the business to
earn competitive edge in the marketplace. For instance manager of intercontinental hotel is hiring
candidates in their organisation by following all the apt methods which is working as catalyst in
performance of employees as they feel fairness in process of hiring. This enhances overall

productivity of the business due to which high competition can be given by intercontinental hotel
to their rivals (Alaloul, Liew and Zawawi, 2017).
Reduce attrition and improve productivity: Effective recruitment and selection process
is helpful in maintaining employee retention ratio and enhancing management over business in
more considerable manner. As employee feel valued by proper recruitment and selection which
helps the business to attain their major objectives in prominent manner. Furthermore when
employees are highly satisfied with their jobs then this renders high trust on business which
helps them to sustain at that place and show their talent and contribute in business growth. For
example manager of intercontinental hotel is using effective tactics of recruitment and selection
which helps them to obtain high skills in their business and due to this business may have
distinct competitive edge in the marketplace by which competition can be established between
rivals and this lead them to have high brand image and share as well.
TASK 3
Analyse and evaluate principle factors that affect culture, equality and diversity of an
organization
Culture: It includes those factors, which is surrounded by belief of an individual. Culture factors
might be Values, beliefs, cuisines, preferences or even the society where the particular person
resides. Cultural factors might greatly affect the hotel industry as they attract customers globally.
In context of Intercontinental hotel too this may have huge impact over stability and profitability.
(Barak, 2016)(Wagner, 2016)
Importance: Analysis of Culture of any place where business operates plays an important role in
success of any organization. To ensure high profitability and customer base it is necessary to
keep following the culture of the place where business operates. This culture analysis assists
manager of Intercontinental hotel to understand various cultures and cultural factors globally. As
in UK, we can note that there is a culture to spend weekend or day offs at hotels to feel relaxed
which plays a major role for hotel industry as a hotel to increase their revenue and extend their
customer base.
Factors that affect Culture:

Religion: It is a prominent factor in analyzing culture of any organization or place. This has its
own pros and cons for hotel industry. In context of Intercontinental hotel it is possible to gather
all pros by making sure that they consider all the cultural requirements of that region in mind
while structuring their services so that customer can get the services as per their cultural
preferences. For example Indian culture is demanding spicy food so they can keep their taste
accordingly.
Ethics and Values: Every region has their own unique ethics and values and therefore constant
set of values and ethics cannot be followed by Intercontinental hotel as well across all region of
their business operations it has to be dynamic else this might adversely affect their profitability.
Adherence to these factor might assist Intercontinental hotel in attracting large range of
customers and increase their customer base. (Mone, London and Mone, 2018)
Equality: It refers to democratic phase and stage where everyone considered and treated equally
and no discrimination done on any basis. Everyone considered equal whether rich, poor, gender,
caste etc. This is vital to analyzed for Intercontinental hotel as well from various aspects
provided below-
Importance: Concept of Equality is important in itself to ensure justice and fairness. Through
equality every customer and employee are treated equally and provided with equal and
appropriate opportunities without any kind of discrimination. Intercontinental hotel can
themselves try to have an equivalent pay structure for employees and their services should not be
discriminated for any customer on any inappropriate basis.
Factors that affect Equality:
Non-Discriminated treatment to any particular user group: To ensure equality this is the
major factor to be taken care by Intercontinental hotel. Most of the business while operating treat
some particular group of customers in an special manner as compared to all other customers
which leads to inequality and negative wave among customers and this might have negative
impact over brand value as well as revenues. So Intercontinental hotel have to ensure that they
treat all their customers equally without any kind of discrimination on any basis.

Diversity: It denotes discrimination based on geography, profession, social and economy.
Intercontinental hotel can avoid the negative impact due to this by ensuring fair adherence to this
concept. They can include all their employees’ part of their decision making process to keep
them positively motivated and get them to work effectively as they may feel to be equal and
valuable to the organization by themselves. This would positively affect their hospitality
business in terms of revenue, resource utilization and getting the edge over other competitors in
the market (Sharma, 2016).
Importance: The prominent take away from diversity assurance is that it would positively
influence and motivate all the employees of Intercontinental hotel to considered the business
success as their own and effectively dedicate their efforts towards achieving those desired
visions and missions. It also ensure better sustainability of business and attrition rate of
company.
Factors that affect diversity:
Culture: The term culture itself covers all the major diversity parts. Intercontinental hotel should
maintain an happy and healthy work environment and culture both internally and externally to
have all the possible positive reflection of success on their revenues, profits, brand value etc.
however if they fail to do so it might have its own adverse consequences.
TASK 4
Identify and describe main methods of performance management utilized by organizations to
ensure targets and achieved and organisation competitive advantage
Performance management: This is referred as a systematic tool which is used by organisation
in order to monitor performance of their employees and to bridge gap between their efforts and
final objectives. In the context of intercontinental hotel the manager is using various performance
management tools so as to obtain high efficiency form their employees and to get distinct
competitive edge in the marketplace by obtaining high performance from their employees. This
approach is helpful to satisfy market demand as well because employees are fully completing
their duties (Evans and et. al., 2017).

Methods of performance management
360 degree opinion: This tool is proven to be most effective and evaluates reviews of
employees in a very simpler way. In this reviews are obtained from employees by taking base as
their peers, customer and other persons in order to eliminate any rigidity and fabrication of
views. This is helpful in understand employee performance and working environment of
business so as to motivate employee to perform in way better way.
Management by objectives: This is referred as the method which is used by manager
and employee in a combined manner so as to monitor and organise specific objective for some
particular period of appraisal. The performance is being valued on the basis of SMART
objectives and on that basis overall organisational aims are accomplished.
Psychological appraisals: Within this approach hidden talent can be found out by
manager of their employees on the basis of examining their performance. On the basis of
interpersonal skills, critical thinking, leadership skills personal attribute of an employee are
examined so as to motivate them for performing in a better way by which organisation can touch
new growth heights in the market.
From the above discussion it can be analysed that intercontinental hotel can use 360
degree method for their performance management as this method is helpful for them in
enhancing motivation and awareness in employees for performing in a better way. This is
somewhere helpful in motivating them for invest their overall skills in business so as to retain
their market position and continuously adapt growth opportunities.
TASK 5
Discuss an outline plan which offers recommendations on issues raised in presentation
Identify the area of improvement: Within the first stage intercontinental hotel is required to
recognise their problem which they are facing such as cultural issues in recruitment process and
adoption of appropriate method of performance management. This stage is the core step as the
major aspect of the whole process is recognised in this stage.

Create a dedicated team for improvements: Next step is to make effective team which could
be helpful in making improvements in business. As in context of intercontinental hotel highly
skilled candidates are selected in order to avoid any cultural gap as they have experience of
working form global level. (Saleem., 2017)
Collect data to make improvement: Within this stage relevant data is collected so as to solve
faced issues by intercontinental hotel. In this context various software are used in order to select
best possible way to deal with these issues and satisfy their customer within prominent manner.
This is helpful for them to create healthy environment and to render best possible facilities to
their employees in order to utilise their full skills.
Implement: This stage is all about implementing all the planned strategies so as to put a step
ahead for solving faced problem. In the context of intercontinental hotel within this stage track
record of employee are maintained in order to retrieve that information in plan achievement.
Evaluate: This is the last step in which all the implemented plans are evaluated so as to measure
effectiveness. This is helpful so as to determine overall efficacy and time wasted during plans of
actions.
CONCLUSION
From the above detailed report it can be concluded that business environment is having
prominent role in success of the business. As there are so many factors which are to be analysed
within business environment which are having high positive and negative implications on
business. Recruitment and selection is having high impact on business and individual
performance as well as this encourage whole workforce to stay entrusted towards the
organisation and to render fuller skills to attain business objectives in appropriate manner. With
the help of effective management plan employee performance can be examined in appropriate
manner with that rewards can be given to them accordingly. At last various issues are faced
within performance management and recruitment and selection so with the help of outline plan
these issues are sorted. (Camilleri, 2017)

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