Challenges and Effectiveness of Corporate Strategy in Hospitality Industry

This report analyzes the challenges and effectiveness of corporate strategy in the hospitality industry. It discusses the importance of corporate strategy in achieving goals and objectives, and how it helps in managing all the departments and job roles in the hospitality industry. The report also identifies the challenges faced by the industry and provides solutions to overcome them.

Hospitality
Management

Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
TASK...............................................................................................................................................3
CONCLUSION..............................................................................................................................11
References .....................................................................................................................................12
Books and journals:....................................................................................................................12

INTRODUCTION
The report aims to analyze the principles and models of strategic management in hospitality
industry. Every business requires strategic decision in order to accomplish their corporate
strategy. It involves planning and preparing policies in order to achieve goals and objective of
company. Strategies play important role in setting a desired objective. Corporate strategies are a
clear path which get accomplish through good strategic decision. In hospitality sector, there are
wide range of product and services that require utmost customer satisfaction to be a market
leader. There and many areas in the sector which are travel in tourism, resorts restaurants, fun
and entertainment and many more. They might face many challenges in implementing corporate
strategies across all over the hospitality sector. It requires many competitive strategies that
managers must carry out to enhance performance and band name into market. Strategic
management is a combination of many pre determine and futuristic plants and policies that will
be helpful to raise company's performance (Petera, Wagner, and Šoljaková, 2020). It gives a
white range of options to choose from the objectives that could company hold throughout their
financial year. It helps in managing all the departments as well as job roles in the hospitality
industry which require more concentration on customer services. It ensures harmony and
coordination within organization management. This essay is going to critically discuss about the
corporate strategies plan by hospitality industry and how it face challenges and effectiveness
through strategic management process. It will showcase how the corporate strategy is linked with
the strategic management for global hospitality operations. Therefore, the challenges will be
identified and proper solutions will be provided.
MAIN BODY
TASK
The aim of the report is to analyse the challenges of corporate strategy and its
effectiveness for the success of hospitality industry.
The objective is to develop a coherent corporate strategy for both small and large size
hospitality Organisation in order to get success and growth into the market.

To analyse how the corporate strategy could implement successfully by encountering every
problem to a relevant solution.
Corporate strategy is a part of overall companies’ approach which is beneficial to manage and
carry out wide business practices. It helps in gaining competitive advantage over other Rivals
and secures a better position into market. Corporate strategies are known as planned criteria on
which the whole organisation will work on. In hospitality and tourism organisations company
needs to be aware about their passion objectives and future goals (Im, Kim, and Miao, 2020).
This strategy plays a vital role in going into international market as it is the basic in for every
hostility sector. The corporate strategies are a part of strategic management which includes the
combination of all the values, ethics, employees’ engagement, coordination and overall
objectives of company. The strategic decision is all must to analyse the companies’ potential. For
example, the holiday inn hotel has their aim to fulfil customer needs as per the latest trends and
requirement into market. The company has set specific directions and criteria to achieve this goal
(The growth of Holiday Inn Express shows brand momentum in Europe, 2021). The corporate
strategy is prepared through specific aims, plans and actions to achieve the objective. The
objective is to set standards for giving luxurious service to the customers by providing range of
facilities. Their strategy is to carry out all the practices in sustainable manner by promoting
reusing, recycling the waste, attracting stakeholders and make them awarded with good return.
The organisation frequently looks at their potential that how they could achieve more success
into market and what are their current operations and what needs to be changed in the future. It
includes the entire values attitude and potential a company carries to fill the gap into market. The
holiday inn started their operation in US. By seeing a positive response from the customers they
had decided to expand their brand name into other countries as well. The objective is become
wider, so the actions also need to be extensive (Holiday Inn, 2022). Then in future, the holiday
inn was acquired by Intercontinental hotels and resort which has become a unique brand into
hospitality industry. The Moto of this reach is to provide customers a unique experience of their
culture. The hotel wants to carry out their home culture into other markets so that they could
provide more opportunities rights and experience to the people. It is all a part of their corporate
strategies which shows where the business is and where it wants to go. It also includes coping up
with dynamic environment in order to respond market changes. Therefore corporate strategies

help in making an organisation flexible by exploring new criteria of working and work for
customer satisfaction. It has seen that many hostility organisations are successful in current time
they have high revenue in market share as compared to other sectors. It is because they believe in
customer satisfaction and bring new changes through developing new plans and strategies often.
Many hotels are adopting the portfolio approach for hospitality industry in order to achieve their
objectives and vision. The strategy behind this approach is to provide wide range of products and
services which will satisfy every customer need into large market. Through ongoing market
research, the customers have different taste in personalities that require different services into
market. Therefore hospitality industry is one of the Best service provider due to having good
product and service portfolio which all the people would like to experience. One of the best
examples is Intercontinental Hotel who has different range of facilities. They provide in house
accommodation, restaurant, food and beverages, Spa, resorts and other fun and entertainment
(Mohammed, and Rashid, 2018). It is also a strategy to attract large customer towards the hotel
and remain a market leader for all the competitors. It includes many risks for the hospitality
sector as the more extended the portfolio the more it includes wastage and risk involve in the
operations. If the product and services would fail to attract customer it will be a huge failure for
the company. In the recent time hospitality organisations are one of the best growing sectors who
have achieved high revenue, customer engagement and full filling market share. Strategic
management is all about managing the overall organisation like employees their performance
coordination work efficiency and many more which are relevant for achieving objectives. In
hospitality industry, due to having large operations, management is vital for smooth functioning
which requires employee support and positive attitude. Therefore the hospitality industry needs
to look at both internal and external factors which impact on their functioning. It might include
threat and opportunities and government influence as well (Martínez-Martínez, and et.al. 2019).
There are many reasons which become barriers to implement corporate strategy in a well
manner. So that the organisation needs to use strategic models like BCG growth Matrix, pestle
and Porter. These are effective strategic models which help in taking best decisions and
formulating policies. By using BCG matrix, the organisation could look for their portfolio of
products by analysing its market share and growth (Cerchione, and Bansal, 2020). This Matrix
helps in giving products A category which showcase its potential into market. In a wide range of
portfolio, not all products are meant for customer satisfaction in which some of them require

innovations and more focus on product features. The hospitality sector has many services which
could create opportunities and some of them may have low growth share. Install category these
are those product who have high market share and growth. These are the most trending products
which can generate much cash for the company. In hospitality Sector, these products are mainly
accommodation and food which is necessity tourist and guests. The products under cash cows
are which have high market share but low growth. The question mark and dog products are those
who have low market share and low growth which can become better through appropriate
strategies and innovation. Many large organisations require corporate strategies which could add
value into their products and services. IT put a lot of pressure on large size of Organisation in
hospitality sector. The strategies are mainly prepared to reduce the cost increase revenue and
market share be attentive and responsive to customer demand and often analyse the need of
innovation and satisfying stakeholders (Rhou, and Singal, 2020). A business is surrounded with
many responsibilities to share knowledge information and their working aspects in order to be
trustworthy in the eyes of customer and government.
The companies are required to these kinds of pressure as soon as possible so that their
competencies will not get discard from the market. They need to adopt low cost Strategies and
offer products and services to maintain a balance in customer demand. They need to maintain a
hierarchy at internal as well as external level with other businesses. So that good relations would
be maintain and the efforts will be collaboratively more superior to achieve corporate objectives.
The pestle and porter 5 forces tool is helpful in identifying the market condition in which the
industry is operating.
Pestle analysis helps in providing macro environment conditions through assuring
political social environmental, economical and Technology factors which might impact on
hospitality operations.
Political factor: Organisations operating in UK have less
political interference is due to having stability.
But the brexit has negative impact on growth
of Companies as they could not perform
operations into European Union freely.

Environmental: The Other factors like environmental is also
necessary in order to meet with customer’s
demand, their values and attitude in the market.
The companies need to be responsible towards
their environment to achieve their objective
(Darvishmotevali, Altinay, and Köseoglu,
2020). When the organisation like Hilton,
Marriott and others make great environmental
policies which would not affect the planet and
avoid wastage through using approach of
recycle and reuse.
Social: The hospitality sectors mainly target the
customers as per their age income groups and
geographical areas which help in fixing their
targets to provide best services. The
organisation like Hilton and Intercontinental
are mainly provide services as per their
customer needs and maintain a luxurious
culture.
Technological: As per this factor, the company needs to take
technological upgradation in the market. The
companies in hospitality industry of UK have
good technological influence by giving online
booking, accepting payments and using digital
platforms.
Economical: As per this factor, the company is required to
contribute in the economy. It includes
balancing demand and supply, inflation and
currency rates. Therefore, the hospitality

industry has high contribution in UK GDP by
attending foreign tourist and large number of
customers.
Legal: The legal factors include obligation of country
laws and legislation in order to present a
positive image in the market. The hospitality
industry of UK has to follow all the equality
act,2010 health and safety act 1974 and
discrimination act.
Swot analysis
Strength Weakness
The UK hospitality industry has huge
contribution in maintaining demand and
supply in the market.
The industry provides range of services and
facilities for fulfilling customer demands.
The hotel industry requires huge set up cost
due to which they result in failure in long run.
The industry has seasonal services and
dependence on tourism.
Opportunity Threat
The hospitality industry has many
opportunities to expand in various part of the
world thorough technology.
The industry is threatening by Covid-19 due
to which, the business is facing huge losses
(Holiday Inn hotel group revenue falls as
Covid-19 keeps people at home, 2021)..
The essential components of corporate strategy to Vision the objective and set corporate
values for long term achievements. It involves commitment and promises towards market and
creating team work and leadership to make it possible. It is not difficult to prepare a strategy but
it is difficult to implement it in an effective manner. For that instance a planning and process is

required which is the part of strategic management. It includes allocation of resources, brings
ideas for innovation and provides guidelines to the Employees and staff for smooth functioning.
The next approach of corporate strategy is core competencies in providing value into the product
and services. This shows that the organisation must have rare, in imitable, valuable and rare
resources in order to meet with the competitive Rivals into market. It includes all the potential in
terms of capital employees and staff management practices and tangible resources which put
together as input to gain desired outcome (Murphy, Torres, Ingram, and Hutchinson, 2018). It is
necessary to use and allocate resources effectively as it is also a part of corporate strategy to
minimise the cost and provide valuable Services within affordable prices.
The strategic formulation process also involves divisional plans and setting different
departments for different roles and activities. Core competencies give a potential to organisation
to remain one step ahead from the competitors. Strategic management process involves
definition of organisational strategies which is necessary to undertake. The hospitality
organisations are full in pressure in order to regulate best practices for environment. this industry
has use operations like food, travel and tourism Resorts flights and many more which includes
more people engagement and leads to more use of resources. So that the essential components of
strategic management process are environmental scanning strategy formulation implementation
and evaluation. As per environmental scanning commit is a process of gathering and
scrutinizing, the objectives for making strategies. This process helps in identifying all the
internal and external factors that may impact on further progress of company. Once all the
factors get analyse the company would take action for formulating strategy (Yacoub, and
ElHajjar, 2021). For example, the Marriott Hotel has faced many obligations over its vintage
interior and not following the modern Trends which is mostly like by the current youth. This
problem is identified through external analysis of company which shows what society wants and
there is need for bringing changes. Therefore the company has took several actions for
formulating strategies which will meet best of customer demand. So the company has said
standards which target upper class of society and give a status and reputation in the market. The
implementation stage involves moving from preparation to action take place. It includes making
an organisational culture and structure which will lead to help in strategic implementation and
come up with great ideas for eliminating negative impact of market. The stage is most crucial as
well as sensitive 1 in which more concentration will be put on human resource (Bowen, and

Morosan, 2018). It requires effective leadership and Management to guide instruct employees in
an effective manner. The training should be consistent and support needs to be provided for
achieving every single in and purpose behind strategic formulation. The implementation process
requires decision making and involving changes as per market conditions with needs to be taken
care by utilising all the risk. At last, the evaluation stage is important to analyse both positive and
negative impact of the strategy into the market (Singjai, Winata, and Kummer, 2018). This
process is necessary to showcase weather organisation need to carry out the same strategy in
future or not. It will give us clear sign to the hospitality sector to not involve in such practice
which are not in beneficial of society and come up with other great ideas.
As much as the strategic management is important , as much it is quite challenging and
difficult for modern companies. It comes up with new modern changes and techniques which
include leadership style innovation focus on society and from narrow to broad prospective in
decision making. It is not much difficult to create strategic operations but implementation in a
right way is much more necessary to avoid wastage of existing resources and secure brand name.
So that, the problems and issues are quite normal in this dynamic market but dealing it with is
depend upon company’s potential. Hospitality sectors facing a lot of issues in the market, though
it is not showing clearly for the customers but the internal factors says it all about companies
strategic operations. The main challenges are weak strategy in effective training lack of resources
, communication , leadership and approach towards strategic management. The purpose behind
strategy creation is to bring a new objective or vision which involves a lot of opportunities and
path toward success (Chung, 2020). It is all about reducing the milestones broaden the
prospective and reduce the work pressure from employees. It is all about working smart not hard.
Therefore the large organisations like in hospitality sector must in short winning to check
whether the goal is achievable or not. This shows a good strategic formulation but when
organisations assign unnecessary responsibilities and give access freedom to the department to
fast will not be beneficial and shows a week strategy towards achieving goals.
So before moving forward, organisation need to see their clear path from starting to end
goal, analyse whether these are achievable and what challenges it may drive. These decisions
will come up with alternative which will suit to the organisational functioning and not impact on
their growth and development (Ulker-Demirel, and Ciftci, 2020). Another challenge is of in

effective training in which the hospitality sector fails to deliver effective training to the staff and
employees to execute the plan in attire way. The company have many reasons such as lack of
resources capital and exports who could provide great training sessions to employees. Also it all
depends upon how employees engage in the organisational work practices. In hospitality sector,
employee’s remains busy all the time as the guest may arrive at any point and they need to be
well treated and feel comfortable during their experience. In the busy schedule of employees
they must be some right time for providing training to the staff to better secure organisation
objectives (Bavik, 2019). Training and learning opportunities are crucial to bring new changes
into organisation. Employees are familiar with traditional behaviour culture and working criteria
so that they need to be unfreeze and then refreeze with modern changes. Having right training is
necessary to save resources and money which will give more time to focus on other functions. It
also includes taking feedbacks from employees, find difficulties and lack of skills which they
require and daily work updates to ensure their performance. In hospitality sector all the work and
rules are divided among staff but to provide customer service, every employee needs to look for
their satisfaction without hesitation and work as per their standards. Challenge based
development is in effective initiative towards strategic role in providing training which involve
giving task and challenges to the Employees to understand their behaviour and potential. Another
most impact full challenge is lack of resources which is a key to achieve strategic options. In
order to execute strategies resources are vital to bring modern changes (Melián-Alzola,
Fernández-Monroy, and Hidalgo-Peñate, 2020). These are most commonly technology capital
human resource and infrastructure. All the resources must be used as much as it is required and
choose the most fitted once which will not create any obstructions in strategic implementation.
Lack of communication is also a barrier in strategic implementation. Without proper instructions,
information supply and communication the objectives could not be achieve as they will be
misunderstanding, delay and interruptions in providing customer service. Hostility organisation
is all about providing services with is only possible by together efforts. Many companies like
Intercontinental and Marriott have faced improper communication due to which many
consequences have arise in facing competition. The covid-19 was a great cause of bringing
changes due to the situation of pandemic. Therefore all these challenges must the look
thoroughly definition starting fail of strategic planning and required to more focus on positive
collaboration.

CONCLUSION
The report has concluded that hospitality industry is wide and broad which require good
strategic decisions. It could be done through analysing the business environment and order to
take best decisions through eliminating challenges. It has also analyse that the companies require
proper communication resources and good strategies by giving it a short start at initial field and
reach to the desired outcome in future. Therefore the company requires effective corporate
strategies in order to meet with current changes of customers. Like many companies fail to do so
which has face a lot of uncertainty.

References
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