Comparative Analysis of Organization Structures in the International Market

The assignment content discusses various international business structures, including functional structure, international division, matrix, franchising, and joint venture. It also evaluates the critical operations of Hilton hotel in the international market, highlighting the importance of export and import, fund arrangements, and stakeholder analysis. The research concludes that global business strategies have helped Hilton hotel operate its business internationally, while internal and external factors influence its performance.

Global Business Strategy

TABLE OF CONTENTS
Introduction......................................................................................................................................1
LO 1.................................................................................................................................................1
1.1 Reviewing and assessing suitable techniques to analyse the business environment.............1
1.2 Analyzing the micro environment of Hilton hotel.................................................................2
1.3 Analyzing the macro environment of Hilton hotel................................................................3
1.4 Impact of international business environment on Hilton hotel..............................................5
LO 2.................................................................................................................................................5
2.1 Impact of globalization on Hilton hotel.................................................................................5
2.2 Benefits, opportunities and challenges of globalization on Hilton hotel...............................6
2.3 Structure of different organizations operating in international markets................................7
2.4 Critical evaluation of the international operations of Hilton hotel........................................8
LO 3.................................................................................................................................................8
Conclusion.......................................................................................................................................8
References......................................................................................................................................10

TABLE OF FIGURES
Figure 1: PESTLE analysis of Hilton hotel.....................................................................................3

INTRODUCTION
Global Business Strategies are generally designed to enable an organisation to achieve its
objective of international expansion and development. It focuses on three different areas such as
global, international and multinational. The current research project is based on global business
strategies of an organization which is operating its business in international market such as
Hilton hotel. It is one of the leading organizations of UK which is providing its hospitality
services to local and international customers of different countries (Forrester and Maute, 2013).
There are number of factors which influence business operations and performance of the
company. The current research will focus on internal and external analysis of the organization.
Further, it will also shed light on importance and nature of Corporate Social Responsibilities
(CSR) of organization in international market.
LO 1
1.1 Reviewing and assessing suitable techniques to analyse the business environment
There are number of techniques which can help in conducting environmental analysis of
Hilton hotel. Environmental exploration includes examination of internal and external situation
of the company.
Environmental audit is the best technique for analyzing and diagnostic the whole
environment of Hilton hotel (Folsom and et.al, 2012). Internal or micro environment can be
examined by organizational audit and stakeholder analysis.
Stakeholder analysis is appropriate because it helps in determining needs and
requirements of stakeholders and organizational responsibilities towards them. Relative
importance, power and interests of each stakeholder can be easily determined by this technique.
Using this techniques Hilton hotel can develop strong relationship with national and international
stakeholders. Overall, stakeholder analysis is important method for analyzing micro environment
of Hilton hotel in an effective manner (Driffield, Jones and Crotty, 2013).
But, on the other hand, for analyzing macro environment Hilton hotel needs to use
different methods such as Porter’s five force model and Pestle analysis. In which Porter’s five
force model helps in determining position of the organization in front of existing competitors. In
contrast, Pestle analysis plays very significant role in determining different factors which can
influence the performance of the company. Along with this, organization needs to consider all
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these factors which at the time of developing strategies for managing national and international
activities of the organization. PESTLE analysis includes analysis of different factors related to
the Hilton hotel such as political, economic, social, technological, legal and environmental
attributes. Overall, stakeholder and Pestle analysis are important tool for examining micro and
macro environment of the Hilton hotel respectively (Cavusgil and et.al, 2014).
1.2 Analyzing the micro environment of Hilton hotel
Stakeholder analysis:
It is appropriate method for determining external and internal stakeholders of Hilton hotel
which may influence business activities. Analysis has reflected that customers, employees,
suppliers and government are considered as major stakeholder of Hilton hotel (Cano-Kollmann
and et.al, 2016).
 Customers: It is one of the important stakeholders which have direct impact on financial
stability of Hilton hotel. Qualitative services are one of the major needs of customers of
Hilton. So, for satisfying this need Hilton hotel offers customized products and services
to its customers. In addition, Hilton hotel uses Electronic CRM system for developing
strong relations with customers that also help in determining the customer’s expectations
(Santacreu-Vasut, Shenkar and Shoham, 2014).
 Employees: As per the analysis of the organization it can be said that employee turnover
of Hilton hotel is high. It has reflected that employees of the organization are not satisfied
with their job. Along with this, it has also reflected that Hilton hotel id\s providing
appropriate facilities to motivating and encouraging employees. But, communication gap
between management and staff affect their satisfaction level. So, Hilton hotel needs to
focus on employee satisfaction (Dunning, 2013). Suppliers: For satisfying the needs and requirements of suppliers, Hilton hotel needs to
provide appropriate payment to suppler on timely basis. Along with this, Hilton hotel also
develops regular communication with suppliers for managing demand and supply of raw
materials.
 Government: Hilton hotel communicates financial performance of the company to
respective government of the nation. It helps them in developing different decisions
regarding tax payment and others. Therefore, stakeholder analysis has reflect ted that
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Hilton hotel has developed strong relation with government of each nation in which
operates it business (Ball and McCulloch 2012).
There are number of internal factors of the micro environment which may affect the
overall performance of the Hilton hotel. These include strength of employees, strategic risks,
innovation, financial performance of the company, etc. All these factors may influence the
operations of organization.
1.3 Analyzing the macro environment of Hilton hotel
Pestle analysis:
It is an important tool for analyzing macro environment of Hilton hotel. It helps in
identifying number of factors which can affect global business operations of Hilton hotel in
positive and negative manner (Stahl and Tung, 2014).
Figure 1: PESTLE analysis of Hilton hotel Political factors: Political situation of different nations such as UK, US and others parts
of the world affect the hospitality services of Hilton hotel. Rate of terrorism is increasing
in developing countries it has negative impact on tourism which can decline the overall
performance of hospitality industry of these nations. In addition, EU has introduced
various rules and regulations for UK organizations which may influence the business
activities of Hilton hotel (Wild, Wild and Han, 2014).
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 Economic factors: National and international macroeconomic situations and different
monetary factors which have direct influence on sales and revenue of Hilton hotel. For
example, national and international events raise the probability of increasing customers
and sales for Hilton hotel. In contrast, instable economic condition of countries and fiscal
and monetary policies influence the financial position of Hilton hotel. So, at5 the time of
developing global business strategies organization needs to focus on all these economic
factors (Killing, 2012). Social factors: Hilton hotel is one of the favourite destinations of tourists and shopping
lovers. But there are number of social attributes which may influence hospitality services
of organization such as customers’ needs and requirements, current trends, demographic
inofmt6rioan of customer, buying behaviours and growth rate of population, etc. For
example, in developing countries population is become high which increases the number
of customers for Hilton hotel. Technological factors: Technological advancement in catering industry has great impact
on Hilton hotel. These technologies raise the use of cost and reduce energy requirements.
Sometimes technological advancement helps in improving quality of hospitality services
but on the other hand it may have negative impact on technical investment of the
organization. Along with this, changes in marketing technologies and latest techniques
such as social media marketing, digital marketing and website development also augment
the marketing budget of Hilton hotel (Bartle, 2005). Legal factors: There are number of legislations related to customer, employee and
competitors which may affect the activities of the organization. Along with this, legal
issues associated with the global business can also influence the performance of Hilton
hotel. Environmental factors: hospitality industry is generally criticized for environmental
pollution which may reduce the number of tourists for particular country. But, on the
other hand, natural disasters in different countries where Hilton hotel is operating its
business may also affect the financial and overall performance of Hilton hotel. Along
with this, for improving overall performance Hilton hotel needs to focus on sustainable
development of the company (Chang, 2009).
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1.4 Impact of international business environment on Hilton hotel
International business environment is very complex, interdependent and dynamic. It has
positive and negative impacts on Hilton hotel. There are some major aspects which may affect
the business of Hilton hotel at international level such as cultural differences, CSR policies,
political differences and environmental issues and globalization, etc. for managing business at
international level manager of Hilton hotel needs to find balance between social responsibility,
corporate image and competitive strategies. At international level competitors of the global
hospitality market decline the number of customer, sales and revenue of Hilton hotel. Similarly,
Use of technology in business is different in each and every nation so, it also affects the
technological investment and quality of services of Hilton hotel in international business (Das,
2011). At the international level many of the domestic markets are not free from cultural
diversity which may affect the services of the Hilton hotel. At present Global e-business is
increasing day by day and hospitality organizations are suing this technique for attracting tourist.
Global e-business strategies of international competitors of Hilton hotel reduce the scope of
business expansion and financial performance.
But, on the other hand, international business environment raise the business expansion
opportunities for Hilton hotel by which organization can expand and start new hotels and
restaurants in other countries also. Along with this, labour cost in developing nation is very low
which decline the total cost of hotel services of Hilton hotel. So, it is also considered as one of
the positive impact on international environment on Hilton hotel. In addition, legal rules,
regulations, tax policies of different nation influences financial performance of the Hilton hotel.
So, organization needs to analyse the international environment in effective manner (Dunning,
2012).
LO 2
2.1 Impact of globalization on Hilton hotel
 Trade: Hilton hotel is operating its business in more than one country so, it can produce
products and services in those countries which have lowest opportunity cost. But, it is
operating its business in hospitality industry so, Hilton organization cannot export the
finished goods and services in different countries but it can use the trade transactions for
the raw materials for the different main services of the organization. It reduces the total
cost of the hotel services (Santacreu-Vasut, Shenkar and Shoham, 2014).
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 Labour movement: Movement of labours in different countries helps Hilton hotel in
getting skilled and experienced employees. Hilton hotel hires number of employees from
foreign and local market for understanding needs and requirement of tourist of the
different nations. Sometimes i9t raise the labour cost for the organization (Extent of
globalization on organizations, 2014).
 Technical development and exchange: Hilton is adopting new technologies of each and
every nation which helps in attaining competitive advantages in international market.
This factor of globalization helps in improving the quality of hotel services of Hilton
hotel. But on the other hand sometimes it raises the technical cost of Hilton hotel
(Dunning, 2013).
As per the above discussion, globalization affects each and every organization in a
positive as well as negative manner. But it affects the airline industry and those industries which
uses technologies because technological advancement increases requirement of changes in
existing technologies of the company which raise the requirement of the finance. Therefore, it
affects the financial performance of the organization. As compared to the national organizations
globalization highly affect international organizations.
2.2 Benefits, opportunities and challenges of globalisation on Hilton hotel
Globalization increases free trade, movement of labour, growth of multinational
companies, integration of global trade cycle and communication and barriers for business (Costs
and Benefits of Globalisation, 2016). All these factors augment benefits, opportunities and
challenges for Hilton hotel which are described as under:
Benefits:
Globalization increases growth of free trade between more than two countries which
reduces the cost and prices of products and services for customers. It leads sales and financial
performance of Hilton hotel. Along with this, due to the high movement of labour in
international market reduce the labour issue and cost for Hilton. Globalization raises the
purchasing power of customers which increase the economy of scale of hotel Hilton (Beamish,
2013).
Opportunities:
Due to globalization, Hilton hotel can target national and international customers which
help in raising business performance of Hilton hotel. In addition, globalization raises the
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opportunity to adopt new and latest technologies for improving service quality. In addition,
expansion of the business in different countries is also considered as important opportunity for
Hilton hotel.
Challenges:
Managing cost of globalization is one of the major challenge for international business
because globalization increases the cost of environment, labour drain, culture diversity and tax
and interest payments, etc (Cavusgil and et.al, 2014). In addition, understanding needs and
requirements of customers of different culture is also a big challenge for Hilton hotel. Along with
this, managing competition and high investment in technologies are also considered as major
problems of business in global market.
2.3 Structure of different organizations operating in international markets
Each and every organization follows different structure in international market which is
described as under:
 Functional structure: in this type of structure organization creates a base on the basis of
different function and activities of the company such as Production, human resources,
design and customer service are typical functional units, etc. All these functions are
organized by a centralised system and different individuals have responsibilities to
manage these functions in international market. Example: British Airways.
 International division: Some international organizations develop their new divisions in
different others countries without disrupting the organization in their home market. It is
an effective structure for generating high profitability in both local and international
market (Stahl and Tung, 2014).
 Matrix: It is one of the important structures which include combination of both functional
and operational level. In this type of culture, foreign staff members report to local
managers for their function and work. It helps in managing business operations in local as
well as international markets.
 Franchising: It can be defined as a long term cooperative relationship between two
different entities; franchisor and franchisees. In which franchisor provides appropriate
license to franchisees to do business and offer appropriate training, merchandising,
marketing and managing in return for a financial considerations. It is used by
organizations for expanding businesses at different locations. Along with this, it is also
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beneficial for reducing different types of cost of the organization at the time of
expansion.
 Joint venture: In this structure of the business two organizations develop a contract in
which they agree to pool their resources for completing a specific task for a specific
purpose. IT is used by organizations at the time of international expansion. It helps in
managing business operations in different countries.
2.4 Critical evaluation of the international operations of Hilton hotel
For operating business operations at international level Hilton hotel needs to perform
number of business operations. These operations include export and import of different products
and services of the organization. Export of the finished goods and services is beneficial or
increasing the financial performance of the company. But on the other hand, excise duties and
other international taxes increases the final amount of the finished goods and services. Therefore,
organization needs to focus on all those products which have low cost. These products will raise
the total profitability of the organization. Similarly, import is also one of the important
operations for Hilton hotel because it helps in reducing the total cost of the operations (Chang,
2009). Along with this, Hilton hotel needs to make arrangement of the funds for running
business operations. Therefore, all these are the major international operations which are
performed by Hilton hotel for managing business operations at international level.
LO 3
Covered in Power Point Presentation
CONCLUSION
The current research project has concluded that global business strategies of Hilton hotel
have helped in operating its business in international market. Research has also described that
political, economic, social, technological, legal and environmental factors influence business
operations and performance of the company. Study has used Stakeholder analysis and Pestle
analysis for examining internal and external analysis of the organization. It has also described
that Appropriate CSR policies and business ethics help Hilton hotel in operating business at
global level and attaining all opportunities of globalization.
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REFERENCES
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Bartle, I., 2005. Globalization and EU Policy-making. Manchester University Press.
Beamish, P., 2013. Multinational Joint Ventures in Developing Countries (RLE International
Business). Routledge.
Cano-Kollmann, M. and et.al, 2016. Knowledge connectivity: An agenda for innovation research
in international business. Journal of International Business Studies. 47(3). pp.255-262.
Cavusgil, S. T. and et.al, 2014. International business. Pearson Australia.
Chang, M., 2009. Global Business Strategy: Asian Perspective. World Scientific.
Das, T., 2011. Strategic Alliances in a Globalizing World. IAP.
Driffield, N., Jones, C. and Crotty, J., 2013. International business research and risky
investments, an analysis of FDI in conflict zones. International Business Review. 22(1).
pp.140-155.
Dunning, J. H., 2012. International Production and the Multinational Enterprise (RLE
International Business). Routledge.
Dunning, J. H., 2013. Multinationals, Technology & Competitiveness (RLE International
Business). Routledge.
Folsom, R. H. and et.al, 2012. International business transactions: a problem-oriented
coursebook.
Forrester, W. R. and Maute, M. F., 2013. The impact of relationship satisfaction on attributions,
emotions, and behaviors following service failure.Journal of Applied Business Research
(JABR). 17(1).
Killing, P., 2012. Strategies for Joint Venture Success (RLE International Business). Routledge.
Santacreu-Vasut, E., Shenkar, O. and Shoham, A., 2014. Linguistic gender marking and its
international business ramifications. Journal of International Business Studies. 45(9).
pp.1170-1178.
Stahl, G. K. and Tung, R. L., 2014. Towards a more balanced treatment of culture in
international business studies: The need for positive cross-cultural scholarship. Journal of
International Business Studies. 46(4). pp.391-414.
Wild, J., Wild, K. L. and Han, J. C., 2014. International business. Pearson Education Limited.
Online
Costs and Benefits of Globalisation. 2016. [Online]. Available through:
<http://www.economicshelp.org/blog/81/trade/costs-and-benefits-of-globalisation/>.
[Accessed on 13th April 2016].
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Extent of globalisation on organizations. 2014. [Online]. Available through:
<http://www.bitlanders.com/blogs/extent-of-globalization-on-organizations/323384>.
[Accessed on 13th April 2016].
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