Hospitality Business Strategy: Analyzing Macro and Internal Environment for The Tower Hotel London

This report analyzes the macro and internal environment of The Tower Hotel London using frameworks like PESTLE analysis, SWOT analysis, and Porter's Five Forces model. It evaluates the impact of political, economic, social, technological, environmental, and legal factors on the hotel's strategies. It also assesses the hotel's internal capabilities and competencies using the VRIO model. Based on the outcomes, the report suggests appropriate strategies to improve the hotel's competitive edge and market position.

Hospitality business
strategy

Table of Contents
INTRODUCTION ..........................................................................................................................3
MAIN BODY...................................................................................................................................4
Applying appropriate frameworks analyse the impact and influence of the macro environment
on a given organisation and its strategies....................................................................................4
Critically analyse the macro environment to determine and inform strategic management
decisions......................................................................................................................................5
Analyse the internal environment and capabilities of a given organisation using appropriate
frameworks..................................................................................................................................6
Critically evaluate the internal environment to assess strengths and weaknesses of an
organisation’s internal capabilities..............................................................................................8
Applying Porter’s Five Forces model evaluate the competitive forces of a given market sector
for an organisation......................................................................................................................8
Devise appropriate strategies to improve competitive edge and market position based on the
outcomes.....................................................................................................................................9
Produce a strategic management plan that has tangible and tactical strategic priorities and
objectives..................................................................................................................................13
CONCLUSION .............................................................................................................................14
REFERENCES..............................................................................................................................15

INTRODUCTION
The hospitality sector based business strategy is one of the finest ways to develop
effectiveness in major operations (Ahmad, Bakar, and Ahmad, 2018). It is one of the key roles of
a business to focus on development of business strategy to develop healthy and effective
planning. In order to lead the competition it is necessary for all major national and international
companies to increase chances of competitive development by develop strategic actions and
choices. In this project example of The Tower Hotel London is taken into consideration which
is one of the topmost luxury hotels in United Kingdom. Tower Hotel London was founded in
the year 1973 and is known for its world class hospitality services. The hotel has 801 rooms
which are dedicated to provide effective luxury environment to guests who visit the hotel. This
project will analyse macro environment in order to deliver effective practices related to
organisational strategies. The project will also include key explanation of internal environment
and capabilities of an organisation with help of major frameworks. This report will include
analysis of Porter's five forces model in order to develop key and systematic approach at the
marketplace. The project will also apply range of theories and

MAIN BODY
Applying appropriate frameworks analyse the impact and influence of the macro environment on
a given organisation and its strategies
The analysis of macro environment is most essential for a company in order to evaluate
major external factors associated with the business. In order to move ahead of its competitors, it
is necessary for a company to develop focused and major approach related to macro environment
(Altin, Koseoglu, and Riasi, 2018). The PESTLE analysis is major framework which is used by
The Tower hotel London to develop systematic operations. The PESTLE analysis of Tower hotel
is mentioned below:
 Political factors-The political factors are playing a key role in increasing chances of
conducting ethical business. Government of United Kingdom's major policies and plans
are followed by The Tower Hotel in order to perform systematic and precise operations.
Most of the companies focus on development of political factors in order to increase
chances of competitive development. Brexit is one of the major factors which has
impacted on functioning of The Tower Hotel London.
 Economic factors- Economic factors are related to key inflation, deflation and recession
rates which are prevailing in the economy. The major economic factors also include
monetary policy framed by government of United Kingdom. It is one of the major roles
and responsibilities of management of The Tower Hotel to develop focused operations
according to dynamic economic marketplace in order to lead the competition.
 Social factors- Social factors are related to social cultures and traditions which are part
of society. They also play an important role in increasing chances of taking care of wants
of society (Bokareva, and Yudina, 2020). The Tower Hotel London performs analysis of
social factors which are important for development of key approach at the marketplace.
 Technological factors- The technological factors include application of various
information and technology based factors which helps in performing quick and accurate
operations. It is one of the major roles and responsibilities of IT department of The Tower
Hotel London to analyse major Technical factors like decision support system,
knowledge information system and customer relationship management software in order
to develop systematic approach.

 Environment factors- The environmental factors are one of the most crucial factors that
are to be considered by The Tower Hotel London. Main role of environmental factors is
to develop systematic operations to perform sustainable business (Ebersberger, Herstad,
and Nordli, 2021). The companies should develop key approach in following
environmental policy developed by government in order to conserve the environment.
 Legal factors- It is also necessary for the business organisation to focus on application
and development of legal factors. The legal factors are those factors which are formulated
and developed by local authorities for businesses. Most of the organisations also follow
certain rules and regulations developed by local bodies to conduct legal business.
Critically analyse the macro environment to determine and inform strategic management
decisions
The macro environment and its analysis is most important for a business entity to develop
key functions. It helps and supports the company to perform operations according to
contemporary business environment. In the recent times, all main companies focus on
development of business environment in order to develop precise operations. The Tower Hotel
London also takes into consideration development of focused plans which are important for
utilising its external factors associated with business (Ezeh, 2017). The strategic management
decisions are also taken on the basis of analysing the macro environment in a more defined
manner. Different companies also focus on analysing strengths and capabilities which are
important for gaining a major development based approach.

Analyse the internal environment and capabilities of a given organisation using appropriate
frameworks.
The analysis and evaluation of internal environment of a business is most important for
any company. Majority of business operations are conducted on the basis of assessment of
internal environment in a more defined manner. It is one of the major roles and responsibilities
of a company to deliver key and effective practices related to external environment in order to
increase chances of gaining desired success (Högberg, 2021). The SOWT analysis is performed
below to develop effective analysis of The Tower Hotel London internal environment. The
SWOT analysis of hotel is mentioned below:
 Strengths- The strengths are considered as internal capabilities of a business firm which
helps in moving ahead of its competitors. The main strengths of a business entity helps it
to overcome key issues and challenges that are prevailing in the marketplace.
 Weaknesses- Weaknesses are major limitations and obstacles for the company which
impact on functioning of a company. It is very much important for a business firm to
overcome key weaknesses in order to perform focused development of business
operations. The front office management is one of the key weaknesses of a business
entity which creates a major impact on business and its development.
 Opportunities- The opportunities are considered as golden chances for a business firm
which impact on functioning of a business (Kalargyrou, and Costen, 2017). This is main
role of a business to take advantage of opportunities to develop effective practices.
Growth and expansion at the marketplace is one of the key opportunities available to The
Tower Hotel London.
 Threats- Threats creates risk for the business which impacts on majority of functions
related to a business entity. It is one of the key roles of a business to develop effective
and essential opportunities for facing major threats that impact on functioning of
company.

VRIO Model Analysis
Resources/Capabilities Valuable Rare Imitable Organised Impact of Competitive
Advantage
Employees Yes - - - Competitive
Disadvantage
Management Yes Yes - - Temporary competitive
advantage
Kitchen management Yes Yes Yes - Unused competitive
advantage
Customer service team Yes Yes No Yes Long term advantage
 Valuable- The valuable resources are considered as precious resources for a business
firm. These resources are helpful for a business firm in development of competitive
advantage. Employees are most valuable resources for a business firm which are to be
taken care of.
 Rare- Rare resources are considered as main resources which are to be developed
according to business needs. These resources are available in a scare manner so there is a
need to utilise them in an optimum manner (Karta, Kappola, and Widiastini, 2019). The
rareness of resources is also beneficial in increasing chances of growth and development.
 Imitable- Imitable resources are limited and available to only selected business entities.
It is key role of an organisation to develop patents and copyrights for the imitable
resources in order to increase chances of providing unique selling preposition.
 Organised- The organised resources are well managed and well defined resources which
helps in increasing chances of competitive growth. It is key role of a company to focus on
organised resources for dealing with future consequences in an optimum manner.

Critically evaluate the internal environment to assess strengths and weaknesses of an
organisation’s internal capabilities
The assessment of internal environment in order to analyse strengths and weaknesses of
an organisation is most important for a business. It is one of the major and ethical roles of top
level management of The Tower Hotel London to develop key actions which are appropriate in
making organisation more reliable and flexible. The hotel needs to focus on its front office and
kitchen management department to perform majority of operations. It is most important for the
government to also take essential and necessary actions which are appropriate for development.
The organisation and its effective qualities related to internal and external environment are
necessary to take into account for developing major strategies (Konovalova, Yudina, and
Lebedev, 2018). This is one of the most important role of a business to include analysis of the
capabilities and competencies which are also effective for framework development. Internal
environment analysis is performed to determine key strengths which are related to effective
development.
Applying Porter’s Five Forces model evaluate the competitive forces of a given market sector for
an organisation.
The Porter's five forces model is one of the major frameworks which helps a business
entity to develop focused approach in managing major operations. It is one of the key roles of an
organisation to focus on development of Porter's force model analysis in order to gain
competency edge (Murphy, Torres, and Hutchinson, 2018). The evaluation of Porter's five forces
model is also effective in dealing with major consequences related to company growth in future
perspectives. The analysis of Porter's five forces model is mentioned below:
 Bargaining power of buyers- Bargaining power of buyers play a systematic role in
increasing customer centric approach. The Tower Hotel London must perform analysis of
bargaining power of buyers in order to lead the competition. It is also necessary for the
management of hotel to evaluate key perspectives related to bargaining power of buyers.
In the case of The tower hotel London, bargaining power of buyers is low as there are
only few hotels located in the area.
 Bargaining power of suppliers- Most of the business organisations tends to develop
bargaining power of suppliers in order to develop effective approach. In the case of The
Tower Hotel London, bargaining power of buyers is considered as high as there are

limited number of suppliers which are present in marketplace. For understanding all
major dimensions related to bargaining power of suppliers, The Tower Hotel London can
take assistance of its operations and production management.
 Threat of substitutes- The threat of substitutes is considered as major approach which
makes a company backward at the marketplace (Papaioannou, Kriemadis, and
Kourtesopoulou, 2018). It is most important role and responsibility of business to
analyse scope of all major substitutes that are available to a business in the competitive
marketplace. The successful business organisations like The Tower Hotel London has
less threats from substitutes due to its monopoly and reputation at the marketplace.
 Threat from new entries- The new companies which can enter the marketplace are one
of the key threats to a business entity. It is crucial for the organisation to analyse the
impact of new entries on business as it directly impacts on revenue and profitability of a
company. The key business organisations at the marketplace are involved in development
of effective measures that can lead to create more complex situation.
 Competitive rivalry- Competitive rivalry includes the competitors of a business
organisation which can impact on its functioning. It is very much essential for The Tower
Hotel London to analyse impact of competitive rivalry on a business in order to evaluate
effective measures and approaches. The main responsibility of a company is to develop
effective and main approach in dealing with the competitors with help of major strategies
and frameworks (Peters, and Kallmuenzer, 2018) Key role of a business is to evaluate
main purposes behind conducting the operations in order to increase chances of growth.
Devise appropriate strategies to improve competitive edge and market position based on the
outcomes
The major strategies which are effective for development of competitive edge must be
analysed by a business entity. In order to improve the chances of marketplace success, it is
necessary for companies to evaluate best measures and goals. The market position is also the
main criterion to develop key operations in relation to the specific marketplace. Competition
based approaches are also helpful in increasing chances of systematic growth, which helps in
increasing competitive position of company. The major strategies and outcomes of a business
firm are effective to be evaluated in order to increase the business stability and chances of
growth. Main role of a business is to secure majority of operations with the help of strategic

actions that define well enhanced and developed growth of company. In the recent times, it is
one of the major role of business organisations to improve their management planning with help
of professional approach. Development of professionalism will increase chances of growth and
expansion of company at the marketplace. It is the key role and responsibilities of a company to
analyse competitive factors that are effective in developing future perspectives and perceptions.
Major goal of a company is to acquire knowledge through management functions and then
develop certain policies. The Tower Hotel London is always dedicated to achieve effectiveness
in company formulation of actions. The implementation of its strategic actions should be
developed with control and supervision in order to achieve key advantages related to business
development.
Applying a range of theories, concepts and models, interpret and devise strategic planning for a
given organization
The application of key theories and models in an organization helps in achievement of
revenue and profitability. Major theories and concepts related to theories and models also helps
in increasing chances of competitive growth. Theories and models are helpful in increasing
chances of competitive growth and development for increasing the business role in managing
key operations (Poretti, and Blal, 2020). It is one of the major ethical duty of management to
implement different effective techniques to resolve key measures. The following are mentioned
frameworks which are important for making a company more dynamic and competent at the
marketplace:
Ansoff Matrix:
The Ansoff matrix model is one of the major models which helps and supports a
company to develop effective approach. In order to increase chances of stability in business, it is
most important for a business firm to develop focused approach. The main framework of Ansoff
matrix helps a business entity to develop key approach in managing major operations. The
application of Ansoff matrix for The Tower Hotel London is mentioned below:
 Market penetration- The penetration of marketplace is most important for a company in
order to achieve key goals and objectives. The increasing of sales turnover is most
essential priority of market penetration approaches. The penetration of marketplace
includes increasing sales of existing product in existing marketplace. The main role of a
company is to secure good position in the marketplace by analyzing key factors related to

market. The increasing sales of existing products in the existing marketplace is one of the
major aims of market penetration. This requires effective efforts which are to be
evaluated by a business in order to increase chances of systematic development.
 Market development- Market development is one of the major aspects which helps in
increasing key aspects related to business growth. The market development technique
includes focus on selling existing products into the fresh market areas. It is major role of
a business to develop competitive approach(Sánchez-Franco, and Rondán-Cataluña,
2019). The development of market is one of the key responsibilities of marketing
management of company. It is main role of management of The Tower Hotel London to
focus on development of market in order to lead the competition.
 Product development- The development of new products in the existing marketplace is
one of the key roles of marketing management. The Tower Hotel London is focusing of
product development in order to increase chances of competitive growth. The
development of new products includes main focus on key operations related to
competitive growth.
 Diversification- The diversification is considered as one of the major approaches in
marketing. It helps in developing a new product in the new marketplace. Main companies
at the marketplace should increase chances of competitive growth with major focus on
reliability and flexibility. The new product development in new marketplace is most
important for competitive growth of a business.

Porter's generic growth strategies
The development of Porter's generic growth strategies and its application is most
important for companies. The formulation of Porter's generic growth strategies is most important
for a business to be developed to gain success. The practical development of Porter's generic
growth strategies is most important for The Tower Hotel London which is mentioned below:
 Cost Leadership- The cost leadership is one of the major factors which helps a company
to deliver best and focused business practices. It is one of the major roles of a business
entity to develop cost leadership based approach in order to increase chances of
competitive growth (Sigala, 2018). The cost leadership is helpful in increasing
profitability of company as it includes effective prices for products and services that are
offered by a business organization.
 Focus- The main focus of a business should be on different operations that are effective
in making a company more versatile and dynamic at the marketplace. It is most important
role of a business to secure key development based parameters which are responsible for
systematic growth. Key focus on different operations will bring stability in major
business operations of The Tower Hotel London.
 Differentiation- Differentiation includes key focus on major business operations that are
effective in nature. Most of the successful companies at the marketplace are involved in
development of differentiation approach in order to improve quality of key functions and
tasks. The differentiation is one of the finest ways of developing business strategic
frameworks that are helpful for competitive growth.

Produce a strategic management plan that has tangible and tactical strategic priorities and
objectives
The strategic management plan is one of the major steps which can be taken into
consideration by a company to develop effective choices. It is main role of strategic management
plan to develop precise approach in development of strategic frameworks (Sinclair-Maragh,
2017). The main strategic management plan of The Tower Hotel London is mentioned below:
 Analysis of situation- The brief analysis of whole situation is necessary to be analyzed in
order to develop key and systematic approach. In order to analyze the whole situation, it
is very much important to evaluate brief situation of marketplace. The analysis of whole
situation can be performed by considering major factors that are associated with growth
and expansion of a business. The analysis of all major competitive forces that are
applicable for making a company more dynamic are related to development of situation
based factors.
 Framing essential actions-The next stage of strategic plan of The Tower hotel includes
taking key essential steps for business growth. The actions should be taken according to
situation and contemporary business environment (Suoniemi, Meyer-Waarden, and
Straub, 2020). It is main role of a business to also perform key actions on the basis of
growth and development.
 Implementation- Implementation of the strategic plan is necessary for company to
develop essential actions and their actions. Implementation with control and supervision
is necessary for the hospitality sector based organization to achieve desired outcomes of
time.

CONCLUSION
From the above stated report it can be concluded that development of business strategy
helps an organisation to move ahead of its competitors. This project concludes that in order to
gain competency edge at the marketplace, it is necessary for the company to develop strategic
frameworks. The analysis concludes that most of successful companies in global marketplace
apply strategic approaches which are reliable and flexible to gain desired success. This report
concludes that macro environment analysis helps a company to increase chances of competitive
growth by analysing key factors which are responsible for its development. The analysis also
concludes that application of major plans and policies become effective with the development of
proper supervision and control.

REFERENCES
Books and Journals
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, M., Koseoglu, M.A., and Riasi, A., 2018. Performance measurement and management
research in the hospitality and tourism industry. International Journal of Contemporary
Hospitality Management.
Bokareva, E.V. and Yudina, E.V., 2020. Strategic management in the hospitality
industry. Revista Turismo Estudos & Práticas, (S4), pp.8-8.
Ebersberger, B., Herstad, S.J. and Nordli, A., 2021. Hospitality innovation strategies: Robustness
analysis of paths to firm performance. Tourism Management, 85, p.104310.
Ezeh, P.C., 2017. A critical review of market segmentation, target marketing and positioning in
hospitality marketing. The Routledge handbook of hospitality marketing, pp.31-40.
Högberg, K., 2021. Strategic responses to digital disruption: an exploratory study of digital
transformation in hospitality. In 27th Annual Americas Conference on Information Systems
(AMCIS), ELECTR NETWORK, AUG 09-13, 2021. Association for Information Systems.
Kalargyrou, V. and Costen, W., 2017. Diversity management research in hospitality and tourism:
past, present and future. International Journal of Contemporary Hospitality Management.
Karta, N.L.P.A., Kappola, V.B., and Widiastini, N.M.A., 2019. How Does the Shifting of
Marketing Strategy in the Hospitality Industry Contribute to the Sustainability Company
Growth?. International Journal of Interdisciplinary Current Advanced Research www. ijicar.
in, 1(3), pp.41-49.
Konovalova, E.E., Yudina, E.V., and Lebedev, K.A.E., 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.
Murphy, K., Torres, E., and Hutchinson, J., 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.
Papaioannou, A., Kriemadis, T., and Kourtesopoulou, A., 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.
Poretti, C. and Blal, I., 2020. The asset-light strategies and the dividend puzzle: International
evidence from the hospitality industry. International journal of hospitality management, 91,
p.102639.
Sánchez-Franco, M.J., 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.
Sigala, M., 2018. Implementing social customer relationship management: A process framework
and implications in tourism and hospitality. International Journal of Contemporary Hospitality
Management.
Sinclair-Maragh, G., 2017. A critical review of hospitality marketing concepts. The Routledge
Handbook of Hospitality Marketing, pp.21-30.

Suoniemi, S., Meyer-Waarden, L., and Straub, D., 2020. Big data and firm performance: The
roles of market-directed capabilities and business strategy. Information & Management, 57(7),
p.103365.