Hospitality Business Strategy

This report focuses on the implementation of appropriate frameworks and the analysis of the impact of macro environment on hospitality organizations. It also explores the evaluation of business capabilities and the use of Porter's five force model to evaluate competitive forces in the market sector. The case study is based on The Peninsula hotel, a luxury hotel chain operating in the international market.

Hospitality Business Strategy

Contents
INTRODUCTION...........................................................................................................................4
TASK 1............................................................................................................................................4
P1 Implement of appropriate framework and analyse the impact and influence of macro
environment on organisation and its strategy.........................................................................4
TASK 2............................................................................................................................................8
P2 Evaluation of business capabilities through utilising appropriate framework..................8
TASK 3..........................................................................................................................................10
P3 Understand of Porter five force model and its implementation for evaluating competitive
force in the market sector of organisation............................................................................10
TASK 4..........................................................................................................................................11
P4 Apply of different theories, models and concept which devise strategic planning for
organisation..........................................................................................................................11
CONCLUSION..............................................................................................................................12
REFERENCES..............................................................................................................................14

INTRODUCTION
The term business strategy is explained as an effective or right combination of all
decision as well as action which is performed by organisation for accomplishing organisational
objectives within in minimum time period. The main motive to develop business strategy is to
ensure competitive position among market. Hospitality industry is enhancing their business size
with rapid speed through formulating business strategy that makes sound decisions related with
hiring, resource allocation and firing. This report is written from perspective of The Peninsula
hotel which is operating their business in hospitality industry (Aldea and et. al., 2018). It is a
chain of luxury hotel that serve its services within international market. Moreover, this report
highlights on different frameworks and analyse the impact of macro environment on hospitality
organisation. Internal capabilities of business will also analyse with appropriate frameworks. In
the last, report focus on Porter five force models and different range of theories to interpret
strategic planning.
TASK 1
P1 Implement of appropriate framework and analyse the impact and influence of macro
environment on organisation and its strategy
Vision- The vision of Peninsula hotel is to increase their market area by fulfilling needs of
all customers.
Mission- Mission of The Peninsula hotel is to provide their services with adopting safety
environmental aspect.
The term strategy refers to a method that lead an enterprise for formulating an effective set of
action which fulfil customer need and wants in an organised manner (Altin and et. al., 2018).
From the perspective of The Peninsula hotels hospitality business strategy design all actions in
an organised manner that leads to accomplish company goals and objectives according to
decided time period. It also aids management to perform work with required resources.
Framework to understand macro environment
Stakeholder analysis

With the analysis of stakeholders an effective procedure is developed that is utilised for
identifying those individual which impact on actions and activities of The Peninsula Hotel. Some
steps of Stakeholder analysis is mention as follow:
 Step 1- This is the first step which is used for determining number of potential
stakeholders that engage in organisational operations (Bergene, Boluk and Buckley,
2015). It is also used by management to understand the impact of business and strategy.
 Step 2- With acknowledging two different factors an organisation prioritize needs of
stakeholders. The first is interest level of participation and another is power hold by
stakeholders which relates with prioritize of business.
 High interest and power- In NH hotel group employees and customers are more
interested in organisational operations and functions. Moreover, they also hold the
power to take decisions of business.
 High power and low interest- Stakeholders of this category perform organisational
work and task in a right manner as they have high authority but less interest in company
projects. Example- suppliers are example of this category of stakeholder.
 Low power, high interest- According to this category stakeholders are low in power
but take more interest in organisational operations (Du Plessis, Douangphichit and
Dodd, 2015). Example of stakeholder is customers and sometimes it also generate
challenge for organisation for completion of work in effective manner.
 Low power and low interest- With aspect of customer type of stakeholder management
face not any challenge to manage organisational work which leads to complete work as
per decided strategy.
 Step 3- With the analysis of this all stakeholders, now the authorities of The Peninsula
hotel transfer all essential information to stakeholders for completion of task with
implement of right strategy (Du Plessis, Douangphichit and Dodd, 2015).
PESTLE Analysis
The term PESTLE analysis work as a strategic tool and this is used by management for
analyse and understand those aspects which are beyond the control of organisation. Along with
this NH group also implement pestle to formulate right strategy that helps to understand
influence and impact of macro environment on organisation.

 Political factor- This is important for an organisation to follow all rules and regulations
that are developed by ruling government of a country. It results this is easy for
management to perform all task and operations in an appropriate manner because UK
government is open for tourist and visitor and implement flexible policy. So it work also
an influence on strategy of organisation (Healey, 2014).
 Economical factor- The term economic aspect refers to GDP, monetary policy and
income level of UK local individuals that also boost economy of country. In the present
scenario, Brexit is generating challenges for organisation due to which business strategy
of company is impacted. Along with this the it also influence on organisation to develop
monetary policy which aids to overcome from challenges.
 Social factor- UK society as well as it individuals are open for all persons. It also refers
that society is open for all persons who belongs to different country. The purpose of its
individuals refers to generate business meetings that impact on organisational strategy to
modify them and enhance operation into other country. Further, the society is also
influencing strategy to engage individuals for completion of work as per existing
economic of country.
 Technological factor- Technology is impacting on all business operations and functions
due to which task it is completed with right manner. Along with this it is also identified
by management that technology works for adopting new techniques. From the
perspective of The Peninsula hotel it is identified organisation strategy is impacted due
to change in technology aspect it is also mandatory to work with right strategy
(Konovalova and et. al., 2018). Further, management influence all departments to adopt
right strategy in order to remain competitive among organisational world.
 Environmental factor- From past few years it is identified that all organisation and
industry are concern about environment and its aspect. From perspective of Peninsula
hotel it is identified that hotel guest and visitor provide services according to
environment aspect. The weather of country impacts on business as most visitor go for
those places which are warm as it provide them more relax. Further, Peninsula hotel
influence visitor to visit in winter season also by providing snow experience and
comfort accommodation services.

 Legal factor- One of the most important aspects for an enterprise is to complete all
work with the legal requirements. Moreover, hospitality business is a service based
industry so legal rules such as menu law is required by organisation. In context of The
Peninsula hotel it is determine that management implement all laws for performing all
work in an organised manner.
Ansoff’s Growth Matrix
With adopting and implementing model related with Ansoff’s growth matrix among the
business it is easy for management of The Peninsula hotel to accomplish desired goals. Further,
management is focused towards Ansoff’s model is to work with potential strategy (Lozano,
2018). Some aspect of strategy is mention as follow:
 Market penetration- With market penetration strategy an organisation enhances the sale
of its products among existing market. It is one of the most effective aspect because it is
simple to implement and leads organisation to perform work according to decided
strategy. Along with this due to high competition among hospitality industry management
implement market penetration strategy to cover more market area.
 Market development- According to the market development strategy an organisation
promotes its existing services or products into new area. The Peninsula Hotel implements
market development strategy at primary stage in order to implement them among all
stages. It also leads individuals to work into more geographical areas through performing
operations into new areas.
 Product development- This is essential for an organisation that it launch all of its new
services and products among the local market in order to work with product development
strategy (Melissen and Sauer, 2018). In context of Peninsula hotel product development
strategy implement by management for increasing the number of local customers.
Affordable tourist package with better accommodation services is included by
management in product development strategy to satisfy needs of customers.
 Diversification- One of the most risky strategy that is followed by organisation relates
with diversification aspect as it is complex for management to work within new market in
an appropriate manner. The diversification strategy also refers that organisation also
implement new service for completing work according to diversification strategy.

By going through the analysis of Ansoff’s matrix among organisation this is analysed by
management of The Peninsula hotel to manage service with market development strategy. It I
because there are various task performed by management for building strong base by entering
into different market.
SWOT framework
With the implement of SWOT model it is assist by management that is mandatory for
organisation for completing all operations as per strength and weakness (Njoroge and et. al.,
2019). SWOT analysis of The Peninsula hotel is mention as below:
Figure 1Source(https://youthincmag.com/swot-analysis)
Strength
 Home like accommodation services is
offered by management. So it is work
as a major strength for organisation.
 Through attracting international visitor
organisation is supporting economy of
country by raising funds. This also
works as strength for organisation.
Weakness
 The operating cost for hotel industry is
high. At time of off season it works as a
weak point for The Peninsula hotel.
 Due to change in rule of hospitality
industry it is difficult to perform work.
This also demonstrates weak point for
Peninsula hotel.
Opportunities
 With the increase in economy of
developing countries. The Peninsula
Threats
 Change in the foreign country rules,
policy and strategy. Threat for

hotel is working with opportunity to
enhance the revenue and customers.
 According to present market
conditions, number of tourist and
visitor is enhances at international
level.
organisation is increased to complete
work at global level.
 Due to Brexit the overall market of
hospitality industry is impacted. This
also works as a threat for The Peninsula
hotel.
TASK 2
P2 Evaluation of business capabilities through utilising appropriate framework
The internal environment of an organisation work is most important part for management
that leads to perform operations by formulating new strategy (Okumus and et. al., 2019). Some
framework that helps the Peninsula hotel to understand internal environment is mention as
follow:
Resource based view strategy- With implement of resource based strategy among The
Peninsula hotel it is easy for organisation to make better decisions. This is also used by
management to achieve better sustainability among market. Along with this organisation also
aids by resource based view strategy for delivering all services in an organised manner for
satisfying employee requirements.
VRIO framework
Implement of VRIO model within context of The Peninsula Hotel is mention that helps
to understand valuable, rare, imitate and organised resources.
 Valuable resource- High services value is considered by management for performing all
work that leads to generate sustainability among organisation. The workforce as well as
training department of The Peninsula Hotel work as the most valuable resource for
organisation (O'Mahoney and Wood, 2015).
 Rare resource- Almost each organisation utilise their rare resources like an asset that
leads management to work in an appropriate manner. Along with this the training and
development department of The Peninsula Hotel work as a rare resource that lead
company to work with innovation aspect in organisation.
 Imitate resource- Among all organisation which are engage in hospitality industry offer
same services such as accommodation, food service and many more. But it is difficult to

imitate The Peninsula hotel services due to its high service quality and it is also provide
in minimum time period. So it works as a challenge for other organisation.
 Organised– This is the last step under which various services are offered by the
management of respective organisation. The main motive to understand organisation
aspect relates with performing all work in an organised manner (Papaioannou and et. al.,
2018). It also helps individuals to work with full potential.
By analysing the above framework it is easy to understand the internal capabilities of The
Peninsula hotels. VRIO model helps in making effective decisions that leads organisation for
analysing all management perspective which leads to increase brand value of hotel. In the last,
by organised step it is also easy for management to complete and manage work in a systematic
manner.
TASK 3
P3 Understand of Porter five force model and its implementation for evaluating competitive
force in the market sector of organisation
With analysing the Porter’s five force model it is easy to monitor and understand all forces
which are present in market. Evaluation of different forces from perspective of The Peninsula
Hotel is mention as below:
 Competition among hospitality industry- With the increase in scope of hospitality
industry it is identified that competition force is high. This work as a challenge for The
Peninsula hotel to manage all services properly it is because switching cost of customers
is low.
 Potential of new entrants- All hotel which are performing operations either small or
large are able to manage their overall cost (Phillips and Moutinho, 2014). The force for
entry of new entrance in industry is high as most of the organisations are able to manage
work with low cost. For instance local hotel manage work with low operation cost that
aids them to add more value in their services.
 Bargaining power of supplier- As the supplier power for organisation is too low
because The Peninsula hotel is performing work in service industry which is complete
through personnel and employees. So supplier power is low in market and it works a
positive point for organisation.

 Bargaining power of buyers- Customers are the king of market that is leading
management to generate better position in market. Moreover, all organisations are
performing their work with motive of satisfying customer needs and wants which lead
buyer to select services as per requirement. So buyers are high in power for fulfilling
their needs and requirements.
 Threat of substitute products- This force is too low in market that is creating challenge
for hospitality industry as organisation require to make focus on quality of services. This
also refers management focus on clients for managing work that satisfy need of large
number of individuals (Reilly, 2018).
TASK 4
P4 Apply of different theories, models and concept which devise strategic planning for
organisation
Porter Generic Strategy
The Peninsula hotel is able to obtain various benefits that leads organisation for achieving
competitive advantage in market through implementing Porter Generic strategy. Aspect related
with Porter Generic strategy is mention as follow:
 Cost leadership- According to cost leadership strategy The Peninsula hotel perform its
work with low cost. This also helps management for obtaining competitive edge in
market through enhancing company profits by increasing number of customers.
 Differentiation- With the differentiation strategy management is focused to make
difference among its services as it help respective organisation for performing work with
unique methods (Wijesinghe, 2014). In context of The Peninsula Hotel differentiation
strategy is also used to offer more value in organisation services.
 Focus strategy- It is one of the most useful strategy that leads management to enter into
a specific market. From the perspective of Peninsula hotel focus strategy is utilised by
management for generating review about services that leads to add more value among all
services.
Strategic management plan
Vision- The vision of organisation leads management for enhancing number of customers
that increase profits for company.

Mission- To provide high quality of services that is used for enhancing more value
among organisation in order to attract international visitor or individual.
Tactics- With developing direct interaction between customer and stakeholder it is
identified that management is developing better form of tactics. Along with this Marketing mix
is developed for completion of work properly.
Product Organisation is offering all services in the form of package that is
leading individuals for purchasing more services. It leads
management for performing work that increase the market area for
organisation through modifying services as per customer
requirements.
Price Price or cost refers to a complex decision that is used by management
for charging price from customers. Premium price policy is
implemented by management to make fair price for its services.
Place The main focus of organisation is to focus on all those places that are
used for transport (Yeow, Soh and Hansen, 2018). In simple terms
management focus to select those place from which customers easily
travel from one place to another.
Promotion Digital and social media strategy is implemented by business that is
used to promote all services at large level. Further, Peninsula hotel
implement digital strategy as it is low in cost and lead management
to attract large number of customers.
Financial Budget
Particular Amount
Start-up capital 15,000
Investment 4,000
Marketing 5,000
Human resources 4,000
Total 28,000
Implementation- Financial term such as budget play an important role for organisation that is
leading management to complete work with decided cost. The Peninsula Hotel is managing

business as per decided cost which leads to increase profits for organisation. KPI and
Benchmarking is one of the most effective techniques that lead to control all work according to
decided budget. So the overall profits for organisation is increased which help in managing and
increasing business size.
CONCLUSION
With the analysis of above mention information it is concluded that business strategy
leads an organisation to gain competitive edge in market. Along with this the main role of
business strategy is to accomplish company goal and objective through utilising resources that
exists within company. Their area different tools are also used such as PESTLE and Porter five
forces to understand macro environment. In the last, VRIO and Porter generic strategy are also
covered in this report to understand all essential aspect of business strategy.

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