Hospitality Business Strategy

This report discusses the business strategy in the hospitality industry, focusing on NH group of hotels. It includes PESTEL analysis, SWOT analysis, Porter's five force model, and VRIO analysis. It also evaluates different strategic directions and recommends the most appropriate growth platform and strategies.

HOSPITALITY BUSINESS
STRATEGY

MAIN BODY..................................................................................................................................3
PART A...........................................................................................................................................3
PESTEL analysis of NH group of hotel.....................................................................................3
SWOT analysis of NH group of hotels........................................................................................4
Porters five force model...............................................................................................................5
VRIO analysis of NH hotel group...............................................................................................6
PART B...........................................................................................................................................7
Evaluate the different types of strategic directions available to the organization.......................7
Justify and recommend the most appropriate growth platform and strategies............................8
Produce a strategic management plan with strategies, objectives and tactics.............................8
CONCLUSION................................................................................................................................9
REFRENCES.................................................................................................................................10

INTRODUCTION
Business strategy is that type of strategy that has being used to promote growth of
business and makes it gin profit with sustainability in market. In words this is referred to as those
actions and decisions which an organization is required to take in order to achieve goals and
objectives that has been set-up by them in its industry. This is being defined as that strategy that
has been formed in order to promote better and effective decision making mechanism. Scope of
this strategy is very wide because they deal with aspects of business that are related to its
progress. This report is based on NH group of hotel which is a multinational company for hotels
which is having 350 hotels under it. This report is divided into two parts. First part contains
PESTEL, SWOT, Porter’s five force model and VIRO analysis. Second part is going to deal with
ansoff matrix and strategic plan is to be covered.
MAIN BODY
PART A
PESTEL analysis of NH group of hotel
PESTEL analysis is that kind of analysis which acts as a tool which is required by an
organization to promote the growth of its micro-economic factors. This analysis is responsible
for making an organization aware about any kind of problem that can be faced due to external
factors. It includes political, economical, social, technological, legal and environmental. They are
explained in detail as follows:
Political factor In this factor there are certain policies which are being formed by government is
being included. These policies relates towards governments intervention within organizations
business through tax and other policies which directly impacts organizations growth. NH group
of hotels is going to be impacted through this factor in a manner that if tax rate is increased then
prices of services provided by the hotel are going to increase which is eventually going to
decrease in profit of the organization (Cheon and Cheon, 2016).
Economical factor This factor is related to circulation of economic and deals with various
aspects related to it. Economy of a country is one of the most important factors that deal with
directly with the organization. These factors include inflation rate, interest rates, foreign
exchange rates, economic growth patterns etc. Such factors have drastic impact upon an
organizations growth. It is going to affect NH group of hotels in a manner that a rise in the
inflation rate of any economy would affect the way companies’ price their products and services.
It leads to loss of services.
Social factor These are the factors that are related to society and the trends that has been taking
place in an organization. Social factors are the factors in which various aspects related to society
is covered. It majorly deals with social environment that includes trends and taste of the persons

or individual living in particular society. An Organization like NH group of hotels is going to be
effected from this is a manner that changes in the preferences of customers is going to reduce
customer base of organization that is going to result into negative impact upon organization.
Technological factor As it can be observed that lot of changes has been taken place within
technological upon daily basis and for an organization it is very difficult to match the changes
and keep themselves up-to date with it. Lot of new technology has been developing in various
fields and is affecting business process of an organization. An organization like NH group of
hotel is going to effected in positive manner because it is going to lead towards enhancement in
its security and is going make the stay of customer safer and better (Hwang and Lee, 2019).
Legal factor These are those factors that have helped in aiming an organization over legal
aspects which are required to be followed by an organization in order to make the business
performed in smoother manner. It also includes the laws that have been made to guide an
organization over its establishment. An organization like NH group of hotel is going to be
affected from this in a manner that it is required to follow all kinds of legal rules in order to run
its business within a country and avoid legal issues.
Environmental factor Such factors are responsible taking care of environment and deals with
various aspects of it. These factors deals with both biological aspect in which nature and its
aspects are covered. In these factors lot of policies has been formed to take care of environment
that is waste management, pollution control etc. Various committees have been formed that are
there to take care that rules and regulation is being followed properly. An organization like NH
group of hotels is required to follow all these rules because this is going to make that customer
be attracted who are in favor of eco friendly products.
SWOT analysis of NH group of hotels
SWOT analysis is that kind of analysis that is done in order to mark out strength,
weaknesses, opportunities and threats which are to be caused in an organization through its
internal factors. These are responsible for an organization to growth itself and solve problems
related to internal factors( Papaioannou and et. al., 2018). This analysis is very important to
make an organization gain growth and provide stability to itself. An Organization like NH group
of hotels is going to be very much affected through this as it is going to lead towards forming of
strategies to deal with all kind of problems that has been accruing due to internal factors of
organizations. Further the analysis is done as follows :
STRENGTH
 NH group is having large customer
base because of which it has gained lot
of popularity and has build its brand
image.
 Quality of services is better and quality
has also been maintained which has
WEAKNESSES
 NH group of hotels is required to
motivate its employees because if
motivation lacks them task cannot be
achieved on time.
 Also NH group of hotels has is required
to take care of cost services in relation

made strong base of customer.
 Promotion and advertisement that has
helped the organization to reach to
public.
to its customers.
 NH is required to work over
communication pattern has to be
improved as week communication as it
can barred flow of information that can
decrease the task in smoother manner.
OPPURTUNITIE
 The biggest opportunity that is there
with NH group is its services that are
secure and safe for customers staying in
the hotel.
 Diverse workforce has helped in
archiving of its targets in smooth
manner.
THREATS
 NH group is required to see over assist
competitors because they can make the
shifting of customers which is going to
lead towards decreases in percentage of
customers.
 Also fluctuation coordination and
technology is required to be enhanced
in order to make production smooth.
Porters five force model
Porter’s five force framework is the process by which analysis over competition within
an organization is done. These are derived through five elements that are related to competitive
intensity and attractiveness of an industry in terms of its profitability. This five force model is
very important for an organization because it is helpful in maintaining a sustainability of an
organization within the market. Also business gets benefits within its growth. Further it has been
explained as follows:
Competition in the Industry
The first of the five forces refers to various competitor’s ability to beat each other within
competition of market with product and services provided. The larger the number of
competitors, along with the number of equivalent products and services they offer, the lesser the
power of a company. Suppliers and buyers seek out a company's competition if they are able to
offer a better deal or lower prices. NH group of hotel has greater power to charge higher prices
and set the terms of deals to achieve higher sales and profits.
Potential of New Entrants In an Industry
A company's power is also affected by the force of new entrants into its market. The less time
and money it costs for a competitor to enter a company's market and be an effective competitor,
the more an established company's position could be significantly weakened. NH group of hotel
with strong barriers to entry is ideal for existence within that industry since the organization
would be able to charge higher prices and negotiate better terms (Peters and Kallmuenzer, 2018)

Power of Suppliers
The next factor in the five forces model addresses how easily suppliers can drive up the cost of
inputs. It is affected by the number of suppliers of key inputs of a good or service, how unique
these inputs are, and how much it would cost a company to switch to another supplier. The fewer
suppliers to an industry, the more a company would depend on a supplier. As a result, the
supplier has more power and can drive up input costs and push for other advantages in trade. NH
group of hotels is going to be benefitted in a manner that there are many suppliers or low
switching costs between rival suppliers which can keep its input costs lower and enhance its
profits.
Power of Customers
The ability that customers have to drive prices lower or their level of power is one of the five
forces. It is affected by how many buyers or customers a company has, how significant each
customer is, and how much it would cost a company to find new customers or markets for its
output. NH group having smaller and more powerful client base means that each customer has
more power to negotiate for lower prices and better deals.
VRIO analysis of NH hotel group
VRIO is the process by which analysis is being done over various factors that helps in
forming strategies related to growth in an organization.In this analysis the main focus is over
value, rarity, imitability and organizational support. Such analysis is going to be based upon NH
group and has been explained as follows:
VALUE: NH group are having high value and is very much popular as a brand which makes it
compatible and also managing of financial services which made resource utilization possible in
positive manner. All these lead towards building of brand value and making it a popular
organization that is providing services and facilities to its customers (Rosalin, Poulston and
Goodsir, 2016).
RARITY: NH group is being using it resources in very appropriate form that has made in
maintaining of services and products of the hotels that come under this organization. Also this
organization has promoted optimum utilization of resources that had made lot of task achievable
within an organization. Management team of NH group is very effective because they have
formed strategies that are being used for making better and effective utilization of resources.
IMATIBILITY: NH group of hotel is among the most popular organizations that holds an very
strong image within market. This is because both leaders and mangers has done lot of hard work

in taking it to this level and make it a big success. Under various hotels comes that are providing
services to its customers in appropriate manner. Still organization is required to focus upon its
internal and external factors because they make growth of organization possible and also leads
towards there uplifting of an organization. Coordination is required to be check to provide
customer more satisfaction.
ORGANIZATION SUPPORT: NH group of hotels is one of the most important things which
have been proven to be a strong support and is always ready to enhance its resources through
exploring them in the best manner possible. Also the organization uses diverse workforce which
helps in making an organizations work complete within time period specified. Risk taking factor
has played a very important role and making employees part of decision making process has lead
towards forming off effective decision towards welfare of an organization. NH group is always
ready to take risks which show that they are visionary and goals oriented.
PART B
Evaluate the different types of strategic directions available to the organization
This model is very essential for strategic marketing planning in which marketing
planning is to be focused upon. It has to be applied fir looking at the growth and opportunities
that leads towards revenue generation for an business organization is gouging to be helpful in
generation of new product and services or entering into new market. So it's sometimes known as
the ‘Product-Market Matrix’ instead of the ‘Ansoff Matrix’. The main focus is over growth and it
is the most popular model to be used. It leads towards evaluation of opportunities for companies
to increase their sales through showing alternative combinations for new markets. In this matrix
there are four kinds of stages that are involved in it and they are as follows
Market Penetration: In this an organization seeks over achieving of growth with an existing
product which is present there within market segment in order to increase market share.
Market Development: In this part an organization is mainly required to be focused upon
segmenting of a product with existing market segment. This is going to be achieved through
performing research of the market and various aspects of it that is going to make it easy for an
organization to launch its product with improvised services (Sowanber, Ramkissoon and
Mavondo, 2018).
Product and Development: An organization develops new product and targeting over existing
market segment. This is going to be done by using of cheaper manufactures, improvising in
quality and enhancing.
Diversification: This is helpful in developing of a diverse from of market through utilizing of
both the market and product development which is going to be helpful in achieving diversity.

Justify and recommend the most appropriate growth platform and strategies
The strategy that is going to be best useful for NH group of hotels is that of market
development which means that when an organizations is required to set itself in the market with
its existing services then he is required to do analysis of market and mark pout all the changes
that has been taking place within an market. Also it should analyze the trends that have changed
from past years. In these economic policies plays a very important role to make an organization
grow itself in an existing market. This is going to helpful in making an organization to gain
sustainability within a market. In this an organization has to enter with exiting product in a
market.
Produce a strategic management plan with strategies, objectives and tactics
Executive summary
NH group hotels are going to include a full service, three- meals-a –day in the hotels
which come under it. Also strategies are going to be prepared which is going to make invest
process easy and reduces complexity from it. Then improvising in the technology is going to be
there. All this is going to be provided to the customers in order to make them attractive towards
the hotels. Then technologic advancement like installation of biometric, introducing electronic
locks and electronic lockers in every room to provide full security within the hotel to its
customer to make their visit safe.
Mission and vision
Mission of NH group is to provide with product and services of high quality. Also
satisfaction of the organization is going to create towards customer. Mission of organization like
NH group of hotel is to promote diversity. Mission is based upon vision that is going to be
achieved by creating efficiency in services with satisfying needs of customers.
OBJECTIVE
NH group is having objective to sustain in market with the help of attracting an customer
through business expansion (Yen, Singal and Murrmann, 2016).
STP: In this NH group of hotels is going to use targeting, segmenting and positioning as a
strategy this is going to help in the consideration of new product into an existing market.
Segmenting: This is the part in which various segments are been segmented by an organization
in order to expand business. This is done on the basis of behavioral characteristics and
geography. NH group of hotel is required to target market on the basis of geographical area.
Targeting: NH group of hotels has to target different strategies in market. In order to introduce
itself within the international market and making it more popular with increasing of brand image.

Positioning: NH group of hotels has to position its vintage products through opening way of
making its services smoother and easily accessible to its customers.
Entrepreneurial Strategies: As per this an organization is required to expand in various
markets of countries with existing product. This is going to make business attract new customer
in market that is going to be operations for NH group of hotel.
Marketing mix: In these managers is going to play an important role. As they are going to
examine product, price of the new areas in which market is to be setup. This is going to make
NH group of hotels to set up market and cover vast area.
Financial information: launching of product in an existing market. This is going to help NH
group of hotels to analysis its finances.
CONCLUSION
From the above report it is clear that strategy of business is a very important part that is
required to be there for growth of an organization. Then PESTEL analysis for external factors
and their impact. SWOT analysis is done, ansoff matrix is also made. VRIO analysis is done. In
the end an strategic plan is made upon NH Group.

REFRENCES
Books and journals
Cheon, G. and Cheon, Y., 2016. A Study of the Relationships among Hospitality, Corporate
Social Responsibility, Quality & Price Value, and Customer Satisfaction: Focused on the
Five Star Hotel. International Journal of u-and e-Service, Science and Technology. 9(10).
pp.209-222.
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pp.314-329.
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development of tourism and hospitality industry in the regions. Journal of Environmental
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Law, R., Fong, D.K.C., Chan, I.C.C. and Fong, L.H.N., 2018. Systematic review of hospitality
CRM research. International Journal of Contemporary Hospitality Management.
Martínez-Martínez and et. al., 2019. Knowledge agents as drivers of environmental sustainability
and business performance in the hospitality sector. Tourism Management. 70. pp.381-
389.
Papaioannou, A. and et. al., 2018. Customer oriented strategy and business performance in
tourism and hospitality industry. In Innovative Approaches to Tourism and Leisure (pp.
417-432). Springer, Cham.
Peters, M. and Kallmuenzer, A., 2018. Entrepreneurial orientation in family firms: The case of
the hospitality industry. Current Issues in Tourism. 21(1). pp.21-40.
Rosalin, G., Poulston, J. and Goodsir, W., 2016. Strategy communication in family-owned
restaurants: Ad Hoc and Ad-Lib. International Journal of Hospitality & Tourism
Administration. 17(2). pp.101-122.
Sowanber, V., Ramkissoon, H. and Mavondo, F., 2018. Impact of sustainability practices on
hospitality consumers' behaviors and attitudes: the case of LUX* Resorts & Hotels.
In The Routledge Handbook of Hospitality Marketing (pp. 384-396). Routledge.
Yen, C.L., Singal, M. and Murrmann, S.K., 2016. Cultural context orientation and recruitment
message strategy: Evidence from hospitality students in the United States and
Taiwan. Journal of Human Resources in Hospitality & Tourism. 15(3). pp.325-345.