Strategic Hospitality Management Plan Report

This report aims to prepare a strategic hospitality management plan for The Corinthia Hotel. It analyzes the macro environment, strategic capabilities, and internal environment of the hotel. Suitable models and theories are used to determine strategic directions for the firm.

Strategic Hospitality
Management Plan
Report

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
PART A...........................................................................................................................................1
Macro Environmental Analysis of Corinthia Hotel................................................................1
Critical analysis of hospitality macro environment to inform strategic decision making in
relation to Corinthia Hotel......................................................................................................5
Strategic capabilities analysis of Corinthia Hotel..................................................................5
Critical analysis of the internal environment of Corinthia Hotel to asses organisational
capabilities, strengths and weaknesses...................................................................................6
Porter’s five forces analysis....................................................................................................7
Description of suitable strategies for to assist the firm gain competitive edge in the market 8
PART B............................................................................................................................................8
Evaluation of suitable strategic directions for Corinthia Hotel..............................................8
Recommendations of suitable strategies for Corinthia Hotel.................................................9
Formulation of strategic planning for Corinthia Hotel...........................................................9
CONCLUSION..............................................................................................................................11
REFRENCES.................................................................................................................................12

INTRODUCTION
The hospitality industry faces continuous changes due to changes in the travelling habits of the
consumer every year. It is important for business firms in the hospitality industry to build
strategic hospitality business management plan which helps the establishment immediately take
action to attain business objectives and gain success in the industry on the basis of external
influences and internal capabilities of the establishment. The present report aims to prepare
strategic hospitality management plan for The Corinthia Hotel. This hotel was established in the
year 1885 as the Metropoole Hotel and was restores in 20111 as luxury Hotel. The present report
utilises suitable models to analyse the macro environment of the Hotel. In addition to this
suitable theories are used to analyse the internal environment and capabilities of the
establishment. Porter’s five forces model is also used to analyse the competitive forces affecting
the establishment. Knowledge about the internal, external and competitive environment of
Corinthia Hotel is used to determine strategic directions of the firm with use of appropriate
models and theories.
MAIN BODY
PART A
Macro Environmental Analysis of Corinthia Hotel
Context Analysis
The course of action or series of decisions which help entrepreneurs attain specific
business objectives is defined as the business strategy of the establishment. A business strategy is
part of the long term planning of the establishment. In addition to this business strategy includes
the guiding principles about decision making and resource allocation in order to attain business
objective of the establishment (Sánchez-Franco, Navarro-García and Rondán-Cataluña, 2019).
Business strategy plays an important role in attainment of business objective as facilitates
an environment where every business decision and action is taken to further attainment of
business objective. Strategic intent is described as the ambitious plan which helps business firms
attain business objectives. Business firms take different strategic directions on the basis of their
goals. Strategic direction which favours completion of vision mission and strategic objectives is
taken by the establishment.
1

The mission, vision and business objectives of the British luxury Hotel are provided
below:
Mission statement:. To provide delighting guest experience with family values
dedication of Corinthis staff and commitment to sustainability
Vision statement: To become leading name in the global hospitality sector
Business Objectives:
 To increase profitability
 To enhance sustainability
 To become a world class dining location
Stakeholder’s analysis
Stakeholder’s analysis of Corinthia Hotel London
LEVEL OF INTEREST
LEVEL OF
POWER
HIGH LOW
HIGH Employees Government
LOW Consumers Suppliers
Stakeholder’s analysis is a useful to analyse the external environment of The Corinthia
Hotel London. This analysis provides information about various influence and power of each
stakeholder along with the level of their interests. Stakeholders of Corinthia Hotel are provided
below:
Employees: The Corinthia Hotel has recruited employees in various departments to
provide effective services to their consumers. The workforce is a high power and high interest
stakeholder off the establishment. The employees of the Hotel have high power on the
establishment as employees play an important role in providing effective hospitality services to
the consumers and managing daily business functions. An action of the workforce directly
affects the services offered by the Hotel (Van der Wagen and White, 2018). They have high
power as because of the decisive contribution given by the employees to the final service
outcome. Employees also have high interest in the establishment as the growth of the firm
provides employee remuneration and career advancement opportunities.
2

Consumers: Individuals seeking services provided by The Corinthia Hotel including
event hosting, accommodation or dining services are stakeholder of the establishment. As it is
depicted above the consumers of the establishment have low power and high interests.
Consumers have low power in the Corinthia Hotel and do not directly influence decision making
but the consumer buying behaviour and purchasing power impacts and shapes the directions of
the Hotel (Murphy and et. al., 2018).
Government authorities: In context of the respective hotel, government authorities which
have high power and influence over the decision making of the Hotel but have low interests on
various business operations. The Corinthia has to make decisions on the basis of government
legislations such as The Health and Safety at Work Act 1974 and The Data Protection Act 201.
The Corinthia has to comply with various government legislations, which increases the power of
government authorities.
Suppliers: The suppliers in context of The Corinthia Hotel include supply of quality
products and interior given to the consumers as part of their accommodation, dining or event
hosting service. The respective gains these products from high quality sustainable suppliers all
over the globe. High abundance of high quality of suppliers of hotel itinerary reduces power of
the consumers over decision making at the Hotel and the interests of the suppliers in hotel
operations remains Hotels or not the sole consumers of luxury interior products.
PESTEL analysis
 Political Factor: Implementation of the Brexit affects the business of Corinthia Hotel.
Brexit creates difficulties in employment of workers from EU nations by the respective
Hotel. In addition to this on a macroeconomic level, Brexit impacts investment
stipulation has positive impact on the UK currency (Ahmad, Bakar and Ahmad 2018).
Positive Impact: Brexits has positive impact on economic downturn in Britain which is beneficial
for the profitability of the establishment.
Negative Impact: The employee shortage of EU workers created by Brexit affects Corinthian in
gaining skilled employees at every position of the firm.
 Economic Factor: The main economic factor affecting the establishment is the
economic downturn in UK which affects the profitability of the respective luxury
Hotel.
3

Positive Impact: The respective establishment has the opportunity to focus on foreign travellers
and consumers in order to maintain profitability during economic downturn.
Negative Impact: The decrease in domestic sales affects the Corinthia Hotel negatively.
 Social Factor: The main social factor affecting the respective establishment is the
changing buying behaviour of young travellers and consumers towards rent based
accommodation service which provides Gym services and home environment. This
changing outlook affects the sale of Hotels (Melissen and Sauer, 2018)
Positive Impact: The firm can attract consumers by adding Gym services as a result of this
factor.
Negative Impact This social factor shifts consumers from luxury hotel which affects the
profitability of Corinthia Hotel.
 Technological factor: The usage of virtual reality to give clients virtual experience of
various services and on-site environment is a rising valuable technology in the
hospitality industry and affects the marketing activities of Corinthis Hotel.
Positive Impact: The main positive impact of VR technology in hospitality is that Corinthia can
use this technology to market Hotel experience to the consumers all over the globe by giving VR
tours to the consumers.
Negative Impact: Investment in VR technology requires the establishment to make continuous
financial investment in order to provide VR experience with changing climate and travel seasons.
In addition to this the establishment has to invest in providing VR tours for various services such
as event hosting to various clients such as business and family clients which further burdens the
establishment. This affects the firm negatively during an economic slowdown in Britain.
 Environmental Impact: The rising concerns over sustainability have affected The
Corinthis Hotel to invest in environment friendly interior products and energy. This
affects brand image and profitability of the establishment (Altin and et. al., 2018)
Positive Impact: The primary positive impact of investment made by The Corinthia Hotel
towards sustainability helps the enhance brand image and attract environment conscious
consumers.
Negative Impact: The negative impact of this factor is that it requires financial investment which
decreases profit margin of the establishment due to increased costs on sustainability.
4

 Legal Impact: The Corinthia Hotel has to comply with various UK legislations which
affect the daily business operations of the business firms.
Positive Impact: The establishment is able to complete their daily business operations in a lawful
manner by adhering to various legislations.
Negative Impact: The establishment has to comply with various legislations which delays affects
daily business operations.
Critical analysis of hospitality macro environment to inform strategic decision making in relation
to Corinthia Hotel
It is determined that in order to create an effective strategic management plan, it is
important to analyse external business environment so that variables affecting success of the
strategic management plan can be identified along with factors which assist in attainment of
strategic objectives (Koseoglu, Law, and Dogan, 2018). Corinthia Hotel needs to build a
business strategy which is in the best interests of various stakeholders. The stakeholders with
high power and high interest are the employees of the establishment. Therefore the establishment
needs to consider the benefits of employees in decision making process of business strategy. In
addition to this various political, economic, environmental, social and technological factors
affect the organisation. Corinthia Hotel needs to address the impact of Brexit on the firm as it
creates shortage of skilled labour and find ways to deal with the economic downturn in Britain.
In addition to this the firm needs to take opportunity offered by changing social trends in young
travels to find rented accommodation to travel and usage of VR technology in hospitality
marketing. The establishment also needs to focus on reducing costs while maintaining
sustainability in order to survive during economic downturn in UK.
Strategic capabilities analysis of Corinthia Hotel
VRIO analysis
Valuable Rare Imitable Organised
Financial
Resources
   
British Heritage    
Human
Resources
   
5

Quality product
offering
   
Valuable: The financial Resources of the Corinthia Hotel London are valuable for the firm as it
enables the establishment to purchase high quality material, technology and hire skilled staff.
This helps the establishment provide luxury hospitality experience to their guests. The British
heritage associated with the building of the Hotel is valuable as it attracts consumers which wish
to gain authentic British travelling experience. The skilled employees working for the Corinthia
London help the firm provide excellent services to consumers from all over the globe which
makes them highly valuable. The high quality services and products given by the company are
valuable as it helps the company create quality name in their industry.
Rare: The British heritage associated with the building of the company as most heritage hotels in
UK are not present in the city. The human resources of the company are rare as it requires high
investment to fill every vacancy at the company with highly skilled workers. The quality product
offering given by the company are rare as other heritage hotels are not able to provide wide
range of high quality services such as broad dining range and event hosting services (Gupta,
2019).
Imitable: The human resources of the company cannot be imitated by others as it requires time
and investment to build a loyal and dedicated workforce. The quality product offering cannot be
imitated as it is the sum of British heritage brand image, human resources, financial capabilities
and communication with quality suppliers to gain sustainable and high quality products.
Organised: The high quality product offering of the Corinthia is organised and helps the
company secure beneficial position in the hospitality market. This is because this capability by
collaboration between internal and external parties such as employees and suppliers, optimal
usage of financial resources and maintenance of British heritage brand image.
Critical analysis of the internal environment of Corinthia Hotel to asses organisational
capabilities, strengths and weaknesses
SWOT analysis
Strengths Weaknesses
 British heritage associated with the  Lack of advanced technology to
provide consumers more
6

building of Corinthia Hotel.
 High quality services and products
offered by the firm.
effective services.
 Increased costs due to
sustainability initiatives.
Opportunities Threats
 To update technological infrastructure by
providing VR tours and robot serving
staff in order to attract consumers.
 The company has the opportunity to reach
global travellers with the help of digital
technology.
 Changing consumer behaviour of
young travellers to move away
from Hotel accommodation.
 Low economic activity in UK.
Porter’s five forces analysis
Porter’s five forces analysis is an effective tool used to understand the competitive
environment of the company. The Porter’s five forces analysis of Corinthia Hotel iis provided
below:
Bargaining power of the buyers: This element focuses on the ability of buyers to control
and increase prices of the raw material in order to gain profits from the firm. In context of the
Corinthis Hotel the buying power of the suppliers is low (Adriaanse, van der Rest and Parsa,
2020). This is because of the abundance of suppliers of high quality raw materials to prepare
services of interior products. This enables the company to gain high quality products st
reasonable prices.
Bargaining power of the consumers: This element of the model focuses on identification of
bargaining power of the consumer and their sensitivity in switching brand. The bargaining power
of the consumer is high in case of Corinthian Hotel. This is because have wide variety of options
to select their accommodation services if the prices are too high.
Threat of new entrants: The threat of new entrants in the luxury hotel industry is low
(Singjai, Winata and Kummer, 2018). The main reason behind this the high investment required
to set up a small hotel and in order to compete with The Carinthia Hotel high investment to build
luxury hotel I required.
Threat of substitute products: The threat of substitute products in case of The Corinthia
Hotel is high. The main reason behind this high threat is the increased trend of renting personal
7

property as accommodation service. This is seen by, many as alternative to luxury or normal
hotels. This is because luxurious property can be rented to gain luxury stay in London in
comparisons to Hotel stay.
Intensity of Rivalry: The respective establishment faces high rivalry from different
brands. This includes luxury hotel brands such as The Marriott and The Ned.
Description of suitable strategies for to assist the firm gain competitive edge in the market
The BCG matrix helps business firms in strategic planning by identifying investing,
termination and product development needs for product portfolio of the company. The
application of BCG matrix to Corinthia Hotel is provided below:
Cash Cows: These are the services offered by Corinthia Hotel which have high market
share but the market growth of this service is limited or declining (Abdelrahman Ali and
Wahdan, 2021). This includes the dining services offered by the company as they are considered
high quality and help the firm gain consumers but have limited growth potential. The firm needs
to further reduce the costs of dining services in order to maintain profitability while secure
investment for product development.
The star: The star product of the firm is the one with high market share and product growth
potential. In case of Corinthia Hotel, this product is the wedding hosting services of the
company. This service has high market share and high growth potential and the form needs to
focus on product development of their weeding facilities and services.
The Dogs: These products are at the end of their life cycle and need to be discontinued. In
case of Corinthia Hotel the firm needs to eliminate services which does not contribute to
profitability and does not have high potential for growth.
Question Marks: This includes products at services which are at the start of their journey. The
firm needs to decide on product development or cost reduction of such product in order to
convert them into star or dogs (Konovalova and et. al., 2018). In case of Corinthia Hotel, the VR
tours technology is question mark and the firm needs to focus on using this technology at low
price to enhance global marketing efforts and gain foreign consumers.
PART B
Evaluation of suitable strategic directions for Corinthia Hotel
Porter’s generic strategies
8

Cost leadership: This strategy involves the Corinthia Hotel reducing costs of their
services and attaining high profit margin by increasing scalability of services.
Differentiation: The Corinthia Hotel can adopt this strategy by providing unique services
at premium price.
Cost Focus: The adoption of this strategy requires the respective firm to reduce cost of
their services in a specific market.
Differentiation focus: This strategy can be adopted by Corinthia Hotel by developing
differentiated services for specific marker segment.
The most suitable strategy for the respective firm is differentiation strategy is it enables
the company to stand out from the competition and attract consumers.
Recommendations of suitable strategies for Corinthia Hotel
Ansoff Matrix
Market Penetration: The Corinthia Hotel needs to increase sale of their existing services to
existing target consumer base under this strategy.
Product Development: As per this strategy Corinthia Hotel has to offer newer products to
the existing consumer base of the company. The new products need to satisfy needs of the
consumer and solve their problems in unique manner. This includes offering home environment
and Gym services to the consumers.
Market Development: The aim of this strategy is to enter a new market with existing
products. The Corinthia Hotel can use this strategy by expanding their Hotels in developing
Asian nations.
Diversification: Corinthia Hotel needs to enter new market which new services under this
strategy.
The most appropriate strategy for Corinthia Hotel is market development as it helps the
company face threat of economic downturn in UK and increase profitability.
Formulation of strategic planning for Corinthia Hotel
Company Overview: The Corinthia Hotel was established in the year 1885 as the
Metropoole Hotel and was restores in 2011 as luxury Hotel. Corinthia London offers 283 forms
of accommodation with minibars and laptop-compatible safes. Each accommodation is
individually furnished. Memory foam beds feature premium bedding.
9

Mission statement:. To provide delighting guest experience with family values dedication of
Corinthis staff and commitment to sustainability
Vision statement: To become leading name in the global hospitality sector
Business Objectives:
 To increase profitability
 To enhance sustainability
 To become a world class dining location
Tactics:
 To develop Gym services and offer home environment to consumers
 To expand in Asian countries
 To reduce costs of various services
CONCLUSION
From the above report it is concluded that business firms need to construct business strategy
in order to gain success in their business environment. Macro and internal analysis plays an
important role in strategic plan development. In addition to this BCG matrix, Ansoff matrix and
Poeter’s generic strategy help business firms identify strategic direction of the company.
10

REFRENCES
Books and Journals
Abdelrahman Ali, S. and Wahdan, S., 2021. The Egyptian Tourism and Hotel Sector Crisis
Management Strategy: Application to the Coronavirus Crisis. Journal of Association of
Arab Universities for Tourism and Hospitality.
Adriaanse, J., van der Rest, J.P. and Parsa, H. G., 2020. We’re Teaching IT All Wrong: A Need
for Premortem Analysis in Hotel Strategy Education (and Practice). Journal of
Hospitality & Tourism Research, p.1096348020980794.
11

Ahmad, S. Z., Bakar, A. R. A. and Ahmad, N., 2018. An evaluation of teaching methods of
entrepreneurship in hospitality and tourism programs. The International Journal of
Management Education, 16(1). pp.14-25.
Altin and et. al., 2018. Performance measurement and management research in the hospitality
and tourism industry. International Journal of Contemporary Hospitality Management.
Gupta, V., 2019. Talent management dimensions and their relationship with retention of
Generation-Y employees in the hospitality industry. International Journal of
Contemporary Hospitality Management.
Konovalova and et. al., 2018. Forming approaches to strategic management and development of
tourism and hospitality industry in the regions. Journal of Environmental Management
& Tourism, 9(2 (26)). pp.241-247. and et. al.,
Koseoglu, M .A., Law, R. and Dogan, I. C., 2018. Exploring the social structure of strategic
management research with a hospitality industry focus. International Journal of
Contemporary Hospitality Management.
Melissen, F. and Sauer, L., 2018. Improving sustainability in the hospitality industry. Routledge.
Murphy and et. al., 2018. A review of high performance work practices (HPWPs) literature and
recommendations for future research in the hospitality industry. International Journal of
Contemporary Hospitality Management.
Sánchez-Franco, M .J., Navarro-García, A. and Rondán-Cataluña, F .J., 2019. A naive Bayes
strategy for classifying customer satisfaction: A study based on online reviews of
hospitality services. Journal of Business Research, 101. pp.499-506.
Singjai, K., Winata, L. and Kummer, T. F., 2018. Green initiatives and their competitive
advantage for the hotel industry in developing countries. International Journal of
Hospitality Management, 75. pp.131-143.
Van der Wagen, L. and White, L., 2018. Hospitality management. Cengage AU.
12