Hospitality Business Strategy: Analysing Macro and Internal Environment for Whitebread Plc

This report analyses the impact of macro environment on hospitality organisation and its strategies, the internal environment and capability of business. Application of Porter's five forces model to evaluate the given market sector is also included. Models and theories are also applied to interpret the strategic direction available for the hospitality organisation.

Strategic hospitality
management plan report

Contents
Contents...........................................................................................................................................2
INTRODUCTION...........................................................................................................................3
PART 1............................................................................................................................................3
Overview of the organisation:.....................................................................................................3
Analysing the impact of macro environment on the organisation and its strategies by applying
appropriate frameworks...............................................................................................................3
Critically analysing the macro environment of the hospitality organisation determine and
inform strategic management decisions.......................................................................................5
Analysis of internal environment and capabilities of organisation using an appropriate
framework....................................................................................................................................5
Critical evaluation of internal environment of organisation to access its strengths and
weaknesses, structure and skill set...............................................................................................8
Evaluation of competitive forces of given market sector for the organisation through the
application of Porter's five forces model.....................................................................................8
Suggest appropriate strategies to improve the competitive edge and market position of the
organisation based on the results.................................................................................................9
PART 2............................................................................................................................................9
A strategic plan is interpreted for the given hospitality organisation through applying a range
of theories, concepts and models.................................................................................................9
Strategic management plan........................................................................................................11
Critique and interpret information and through environmental and competitive analysis to
derive a set of valid strategic directions, objectives and tactical actions...................................12
CONCLUSION..............................................................................................................................12
REFERENCES..............................................................................................................................13

INTRODUCTION
Business strategy is a set of plan or decisions which helps the organisation in achieving
specific business objectives (Konovalova and Et. Al., 2018). This is a master plan which is
implemented by the managers of the company to secure a competitive position in the market. It
helps the organisation to achieve effectiveness, perceive and utilise opportunities, mobilise
resources, securing the position of organisation, meeting challenges and threats etc. A business
strategy is the set of competitive moves and action that is used by a business to attract customers,
compete successfully, strengthen performance and achieve organisational goals. For the project,
considered company is Whitebread Plc that provides quality accommodation at reasonable
prices, and growing its presence in Germany.
The project report encompasses the impact of macro environment on hospitality organisation
and its strategies, the internal environment and capability of business. Application of Porter's five
forces model to evaluate the given market sector is also included. Models and theories are also
applied to interpret the strategic direction available for the hospitality organisation.
PART 1
Overview of the organisation
Whitebread Plc is a British multinational hotel and restaurant company whose
headquarters is located at Houghton Regis, England (Whitbread Plc, 2022). It is the biggest hotel
brand in UK with over 840 hotels in the country and employing over 35000 employees in
organisation. the company operates with mission of providing affordable as well as quality of
services for guests in order to assist them to live addition to work well, also impacts on
surrounding nearby to them.
Analysing the impact of macro environment on the organisation and its strategies by applying
appropriate frameworks
Macro environment includes all those major uncontrollable external forces which
influence the decision making of a firm (Martínez-Martínez and Et. Al., 2019). It includes the
trends in Gross domestic product, inflation rate, employment, spending structure of people,
monetary and fiscal policy. The corporate strategy manager of Whitebread Plc considers
PESTLE analysis and stakeholder framework to analyse the macro environment that are as
follows:

PESTLE analysis
PESTLE analysis is a framework which is used to evaluate their business environment in
which a firm executes it operations. Political factors: The Whitebread Plc operates in travel and leisure in many countries, the
organisation has to face different types of political environment and risk (Aksoy and Et.
Al., 2022). The corporate strategic manager of Whitebread Plc analyses the factors such
as political stability and importance of travel in the operating country, corruption level,
etc. UK has stable political system so the manager can apply growth strategy, but it has to
analyse the political factors to expand its business in other countries. Economic factors: The corporate strategic manager of Whitebread Plc the economic
factors such as inflation rate, saving rate, interest rate, foreign exchange rate. UK is
among the largest economies of world, the spending pattern of people is also high. This
enable the organisation to keep the prices moderate and earn adequate profits. Social factors: The corporate strategic manager of Whitebread Plc analyse the factors
such as demographic conditions, skill level of the population, travel and leisure interest.
UK has relatively huge population, people possess different skills and interest. The
potential customers for Whitebread Plc includes the age group between 18 to 60 years.
This age group is focused more because they have great interest in travel and leisure
activity. Technological factors: The new inventions in technology are analysed by the corporate
strategic manager of Whitebread Plc. These new technologies that are search engine
optimisation, artificial intelligence, chatbots and many more impacts positively on the
company to provide best services to the customers. Legal factors: The legal laws, rules and regulation of a country are followed by the
organisation. Different countries have its own laws and rules, the corporate strategic
manager of Whitebread Plc analyse the laws including Equality Act, data Protection Act
and hence forth of country before expanding its business. Environment factors: These factors include all those risk which is related to the
environment such as natural calamity, weather, climate change etc. Environment play
important role in travel and tourism, the good weather and climate attract more tourists
which results in increasing the sales of Whitebread Plc.

Stakeholder Analysis
Stakeholder analysis matrix focus on the stakeholders in relation to their power to impact
and extent to show interest in the operation of the business (Huang and Et. Al., 2019). High influence, low interest: These are the stakeholders who have high influence over
business and no interest in operations of firm. These stakeholders include Government
whose policies like tax can influence the growth opportunities of Whitebread Plc. High influence, High interest: These are the stakeholders like investors and owner of
Whitbread Plc who have high influence and high rate of interest in the operation of the
firm. Low influence, low interest: These are the stakeholders like customers, suppliers of
Whitebread Plc who does not impact the organisation much and has no interest in the
operations of the firm.
 Low interest, high interest: These stakeholders include employees of Whitebread Plc
who have no influence over the business but has mutual interest in the firm.
Critically analysing the macro environment of the hospitality organisation determine and inform
strategic management decisions
It has been critically analysed that, the macro environment enable managers of
Whitebread Plc to know political situations, rules and regulation of countries which help in their
expansion process. The climate change, weather conditions, natural calamities can affect the
profitability of the organisation. Stakeholder analysis helps the managers of Whitbread Plc to
know which stakeholders impact the business in what ways and who take interest in the business.
If stakeholders will have more influence than their decision making will be affected, they will
not be able to take decisions freely.
Analysis of internal environment and capabilities of organisation using an appropriate
framework
Internal environment refers to the elements of organisation that includes their employees,
management and corporate culture (Anning-Dorson and Nyamekye, 2020). The corporate
strategic manager of Whitebread Plc uses VRIO and SWOT analysis framework to analyse the
internal environment:
VRIO framework

VRIO is a framework which focus on value, rarity, imitability and organization which is
used to evaluate the resources and capabilities of the firm. Key competencies of Whitbread Plc
are as follows:
Competencies Value Rare Inimitable Organised
Employees  ✔ ✘ ✘
Financial resources  ✔ ✔ ✔
Patents ✔ ✔ ✘ ✘
Distribution
network
✔ ✔ ✔ ✔
Valuable: The competencies which help in achieving competitive advantage in dynamic
environment are stated as valuable (Reilly, 2018). The competencies which are considered as
valuable for Whitbread are listed below: Employees: The employees of Whitbread are highly valuable, a significant portion of
employees is highly trained which leads to more productive work. Financial resources: Financial resources are highly valuable as these help in investing in
the external opportunities. Patents: These are highly valuable for Whitebread Plc as it allows the organisation to dell
its product without any competitive interference. Distribution network: The distribution network of Whitbread Plc is a valuable resource as
it helps the organisation to reach more numbers of customers.
Rare: Competencies which are rare for Whitbread are as follows: Employees: The employees of Whitbread Plc are found to be rare resource as these are
highly trained and skilled. Financial resources: The financial resources of Whitbread Plc is rare as strong financial
resources are possessed by only few companies. Patents: The patents of Whitbread Plc are found to be rare as these are not easily
available and not possessed by any competitors.

 Distribution network: The distribution network of Whitbread Plc is rare resource for the
organisation. Competitors would require a lot of investment and time to come out with a
better distribution network that that of the organisation.
Inimitable: The competencies which cannot be substituted or copied are inimitable
resources (Gürlek and Koseoglu, 2021). The inimitable resources for Whitbread are as follows: Financial resources: The financial resources of Whitbread Plc are identified as costly to
imitate, as these resources are acquired by the organisation over prolonged profits over
years. Patents: The patents of Whitbread Plc are difficult to imitate as it is illegal to imitate a
patented product.
 Distribution network: The distribution network of Whitbread Plc is identified as imitate
because it has been developed over the years. The competitors will have to invest a huge
amount to imitate the similar distribution network.
Organisation: Competencies that are organised for maximising the potential for
competitive advantage. The following are the resources which are organised for Whitbread Plc: Financial resources: The financial resources are identified as organised to get the value,
use strategically to invest in right places. Distribution network: The distribution network is organised for Whitbread Plc as it uses
this network to reach out its customers.
SWOT Analysis:
SWOT analysis refers to the planning tool which is used to evaluate the internal strength,
weakness, opportunity and threats of the organisation (Rahman, Hassan and Fattah, 2021).
Strength
 Highly skilled workforce by providing
training and development.
 Possess high level of customer
satisfaction.
Weakness
 There are gaps in the product range
sold by the company.
 The company have spend lot more
compared to its competitors.
Opportunity
 New technology provides opportunity
to practice differentiated pricing
strategy in new market.
Threat
 There is no regular supply of
innovative product which can stop the

 The new taxation policy can impact the
way of doing business.
innovation process.
 The buying behaviour of customer is
changing.
Critical evaluation of internal environment of organisation to access its strengths and
weaknesses, structure and skill set
It is critically evaluated that, Whitbread Plc have created a high skilled force by
providing them regular training who continuously work to provide satisfaction to its customers.
The organisation has gap in its product range which can lead to give foothold to new competitor
in the market. The new taxation policy is the opportunity for the organisation which can impact
the way of doing business and increase its profitability. Whitebread Plc lacks in supplying
innovative products which results in few product options for the customers.
Evaluation of competitive forces of given market sector for the organisation through the
application of Porter's five forces model
Porter five forces model is a framework which analyses the five competitive forces which
provides a shape to the industry (Carvalho and de Sousa Paiva, 2020). Evaluation of five forces
of Porters Five Force in context to Whitebread Plc are as follows: Competition in the industry: There is intense competition in the hospitality industry
which will drive down the prices and decrease overall profitability. Key competitors that
create high competition for Whitebread Plc are Hilton Hotel, Ritz London and so on. The
organisation can tackle this by building sustainable differentiation, by developing scale
to compete better. Threats of new entrants: Threat of new entrants is high for Whitebread Plc, the
organisation can tackle the new entrants by innovating new products, building
economies of scale to lower the fixed cost per unit. Bargaining power of customers: Whitebread Plc buys its raw material from numerous
suppliers, powerful suppliers use their negotiating powers to extract higher prices. The
company can tackle this situation through building efficient supply chain with multiple
suppliers.

 Bargaining power of Buyers: Buyers are so demanding for Whitebread Plc, they want to
buy best offering by paying minimum amount. The organisation can tackle this situation
by building a large customer base, through rapidly innovating new products.
 Threat of substitute products: The threat of substitute products for Whitebread Plc is
high if it offers a value proportion which is unique and different. The organisation can
tackle this situation through being service oriented, by increasing the switching cost for
customers.
Suggest appropriate strategies to improve the competitive edge and market position of the
organisation based on the results
It is critically evaluated that, there are lot of competitors are there and threat of new
entrants is high for Whitebread Plc. The organisation can tackle this by building sustainable
differentiation and economies of scale to lower the fixed cost per unit. In the market,
organisation acquire raw materials from numerous suppliers which reduces the threat of
supplier's bargaining power. By building a huge customer base, the organisation can eliminate
the threat of buyer's bargaining power. The organisation can eliminate the threat of substitute
products by being service oriented.
PART 2
Application of models and theories with strategic management plan for the given hospitality
organisation
Porters generic analysis: The strategy of Porter’s generic helps the company in
evaluating its growth, value, competitors in the market (Chibili, 2019). The three strategies of
Porters Generic Analysis in context to Whitebread plc are discussed below:
Cost Leadership: It is a strategy generally used to set the size, productivity, scale and
scope of the organisation. If the managers of Whitebread plc adopt this cost leadership strategy
in the company, then they need to reduce the production cost by increasing the maximum supply
chain.
Differentiation: In this strategy of differentiation, the companies usually focus on
earning profits by making unique and different products from its competitors. If the manager of
Whitebread plc use this strategy, then they need to focus on the innovation of the product so that
they can attract more customers in the market.

Focus strategy: This strategy of focus aims mainly on the small markets, provides them
with the opportunity to make use of either strategies of differentiation or cost leadership. If this
strategy is applied by the managers of Whitebread plc then it can help them in less cost price,
gain more profits so that they do not face any losses. The focus strategy has two variants:
Cost focus: It is a situation when an enterprise gets advantage of cost in the target
section, managers of Whitebread plc can focus on minimising the manufacture cost so that
customers can afford the set prices.
Differentiation focus: When an organisation gets differentiation in the target segment,
managers of the Whitebread plc can invent new products, improve customer segment as well as
can grow in market share.
From the above information, differentiation strategy will be more effective as the
managers can introduce the products according to the need and wants of the customers so that
more people can attract towards the product.
ANSOFF Matrix
This is a two-by-two matrix which benefits the analyst community as well as
management teams to plan strategies and evaluate its growth in the market (Benhadda and
Chibili, 2019). The four business strategies which the managers of Whitebread plc can adopt
based on ANSOFF matrix are explained below:
Market Penetration: This tool is taken in use when companies mainly focus on the sales
of maximum products in the existing customer base market for increment of market share. If the
strategy of market penetration is adopted by the company then they can reach out to many new
customers, increase their sales, grow in the existing marketplace.
Market development: This technique sells their products in the new markets, can be any
other location. If the managers of Whitebread plc use this strategy in the firm, then they do not
require to do any investment in the product or R&D development.
Product Development: The enterprise showcases their new products in the existing
marketplace. If the managers Whitebread plc use this, then they can get the chance to market
new products in the already existing market which results in increasing market share.
Diversification: It is the riskiest stage as the businesses need to enter the new market
with new products. If the manager of Whitebread plc adopt this technique only if they have

research about the risk factors that may arise properly with the new strategies to be use in the
market.
From the above details the managers of Whitebread plc should adopt the product
development strategy in order to grab the opportunity of huge customer base segment and
increasing market share in the market.
Strategic management plan
Strategic management plan refers to the process where the leaders of the company
explain their vision for future growth as well as find their objectives and goals that need to
achieve in the future (Cabral and Jabbour, 2020). Strategic mnanagement plan for Whitebread
Plc is a devised
Background: It is a multinational hospitality group company founded by Samuel
Whitebread in 1742. The managers of hotel provide its customers with best experience in order
to increase the customer base segment in the market. They attract people by their quality
products and services.
Organisation structure: The company can adopt functional structure as it will help them
in dividing the work into different departments for the easy working.
Vision: To provide with affordable hotels to the guest with quality services.
Mission: To provide best experience to customers and build strong brand image.
Objectives: To create a positive environment for the people using the hotel.
Marketing mix: The elements of marketing mix for Whitebread Plc are as follows:
 Product: The organisation brings a jogging area so that people can be physically fit.
 Price: They can use the competitive pricing strategy where the price of the product is set
within the competitor’s price.
 Promotion: They will use the online advertising strategy so that customers can attract
through social media.
 Place: The enterprise will sell their products in local as well as auction market which is
easily available for the people.
 Process: Through brochure, posters and online marketing they can aware people about
the hotel.
 Physical evidence: This can be given by the invoice number of the firm.

 People: Employees are provided with the training programs and personality development
sessions for effective results.
Strategy formulation: From the Porters generic, company has adopted differentiation
strategy as they can innovate the products and renew it according to the customer satisfaction.
Whereas, from the ANSOFF matrix, product development is more effective as new products can
be made which will fulfil the needs and wants of the customers.
Implementation: After implementing the plan the company can achieve sustainable
competitive advantage in the market which results in high market share and strong customer base
segment (Wang, 2022).
Evaluation: The evaluation of the plan can be done by benchmarking as it will help in
computing the performance of a firm's products, services as well as their competitors.
Critique and interpret information and through environmental and competitive analysis to derive
a set of valid strategic directions, objectives and tactical actions
It is interpreted that Whitbread Plc has set the objective as to create positive environment
for people. The organisation can achieve this objective through installing AI services for the
safety and security of the customers. The organisation will become service oriented to provide
best services to their customers. The firm can set up augmented reality to provide best experience
to its customers.
CONCLUSION
From the above report, it is observed that strategic management plays a vital role in
growth of any business. This report focus on identifying the strategic plan for hospitality
organisation. PESTLE analysis and Stakeholder matrix is used to evaluate the macro
environment for the organisation. VRIO model and SWOT analysis framework is used to
evaluate the micro environment of business organisation. The competitive forces are being
analysed through porter five forces model.

REFERENCES
Books and Journals:
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Anning-Dorson, T. and Nyamekye, M. B., 2020. Be flexible: turning innovativeness into
competitive advantage in hospitality firms. International Journal of Contemporary
Hospitality Management.
Benhadda, L. and Chibili, M. N., 2019. Managing Change in the Hospitality Industry. In Modern
Hotel Operations Management (pp. 508-565). Routledge.
Cabral, C. and Jabbour, C. J. C., 2020. Understanding the human side of green hospitality
management. International Journal of Hospitality Management. 88. p.102389.
Carvalho, L. M. C. and de Sousa Paiva, I. C., 2020. Sustainability Reporting in Hospitality
Sector. In Strategic Business Models to Support Demand, Supply, and Destination
Management in the Tourism and Hospitality Industry (pp. 150-163). IGI Global.
Chibili, M. N., 2019. Conceiving Hospitality Processes. In Modern Hotel Operations
Management (pp. 426-459). Routledge.
Gürlek, M. and Koseoglu, M. A., 2021. Green innovation research in the field of hospitality and
tourism: The construct, antecedents, consequences, and future outlook. The Service
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Huang, Q., and Et. Al., 2019. Global hospitality growth and institutional quality. Journal of
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Martínez-Martínez, A., and Et. Al., 2019. Environmental knowledge strategy: Driving success of
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Rahman, M. S., Hassan, H. and Fattah, F. A. M. A., 2021. Optimisation of restaurants’
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Online:
Whitbread Plc. 2022. [Online]. Available through: <https://www.whitbread.co.uk/about-us/our-
business-model/>