Critical Evaluation of Customer Relationship Management in Mandarin Oriental Hotel Group

international tourism and hospitality Management
Institutional Affiliation(s)
TOPIC
"Critical evaluation of the role of customer
relationship management in Mandarin Oriental Hotel
Group"
Student Name

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Table of Contents
Introduction................................................................................................................................2
Literature Review.......................................................................................................................3
Literature Review on Customer Relationship Management..................................................3
Literature Review on Hospitality Management.....................................................................7
Case study................................................................................................................................11
Case study of Mandarin Oriental hotel Group.....................................................................11
Recommendations....................................................................................................................15
Conclusion................................................................................................................................16
References................................................................................................................................18

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Introduction
International hospitality management and luxury hotels has become an important
segment in general tourism and hospitality industry that is undergoing rapid expansions. In
February 2013, Forbes Travel Guide Star Awards awarded 226 four-star hotels and 76 five-
star hotels situated globally which showed an increase of 28.4% and 33% respectively.
Again, in September 2013 the same awards were distributed among 264 four-star hotels and
83 five-star hotels which showed an increase of 16% and 9% respectively and that to in a
same year. It must be noted that every week, more than one luxury hotel was built during the
aforesaid time period (Chu, 2014). Due to internationalisation and competitiveness, tourism
and international hospitality industry has also strengthened with time where well managed
companies are seen increasing in hotel and travel business. In fact, much of the existing
companies are getting enlarged by incorporating innovations to stay ahead of the game. There
are others who try and cut their expenses to save cash for providing enhanced customer
satisfaction within client’s budget. According to Singal & Rhou (2017), the effect of
hospitality management on people can be seen greatly in society at large. Although there are
few issues associated while dealing with customer relationship management, it can be taken
as a part of business. Contemporary hospitality organisations are governed by technology and
innovation along with strategic human resource management (SHRM) so that enhanced
service is provided to the customers while ensuring sustainability of business enterprise
(Ariffin, et al., 2011). There are few challenges also that comes in the path of hospitality
management like gathering of data to select preferred customers or dealing with diversified
culture clients. Nevertheless, hospitality businesses gather data after overcoming various
challenges so that they can serve their customers in a better way which is necessary for their
business. This report will critically evaluate present trends in hospitality and customer

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relationship management by analysing literature and published studies from 2001 to the
present to get an insight of current trends in related fields. Since luxury hotels paly a crucial
role in hospitality industry, this report will make a research on international hospitality
management of Mandarin Oriental Group of hotels by studying about organisation’s
customer relationship management and other services provided to customers that are related
to hospitality sector. In this sense, it will be easier to determine the recent trends in hospitality
management of international hotels along with finding potential gaps in the hospitality
management systems that can lead giving critical recommendations.
Literature Review
Literature Review on Customer Relationship Management
The appearance of the concept “Customer Relationship Management” and
“Relationship Marketing” is seen in organisations since 1920. However, critical
contemplation to the CRM concept is been seen given since late 1990s especially among
business practitioners and hospitality industry (Pedron & Saccol, 2009). The new concept
directed attention towards unembellished aspects that included necessity in directing
consideration towards direct relationship between marketers and customers along with giving
importance to existing customers through providing inevitable building of strong
relationships instead of transactions made to augment profitability only. According to Mishra
& Mishra (2009), “A good customer relationship is the key to business success”. Even, many
organisations have directed their attention focussing CRM and making investment upon
infrastructure with giving concern to latest technological innovation and Knowledge
management concepts. This research is further supported by Khalil et al., (2017) where the

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authors have coined the term CRM with correlation between administrative effectiveness and
customer service for improved development in marketing strategies.
CRM is been considered as one of the most dynamic strategies among millennials
where authors state that CRM concept is not new, rather due advancements in technologies
and current business developments it has gained practical significance ( Alipour &
Mohammadi, 2011). The base of CRM is relationship promotion which has objectives of
improving firm’s sustainable growth and profitability of customers by moving ahead of
product centric marketing strategies. In literature, it has been noted that CRM was invented
since customers varies in terms of purchase habits and preferences. If every customer
possessed similar attitude, CRM would have not been needed (Soliman, 2011). However, to
understand customer drivers and their profitability, firms get tailored by offering effective
product portfolio so that customers remains satisfied and connected (Khalil , et al., 2017).
Since today’s business world have become more competitive and saturated, more and more
companies are considering enabling of CRM practices especially the ones whose business
operations are spread across border nations. Soliman (2011) defined CRM as an
“organization carrying out a lot of information about the customer from various resources and
keeping it in order to divide the territories, analyse and reuse.” CRM is usually enterprise-
focussed function encompassing every department in business which means that in addition
to customer-oriented service, an effective CRM would also include product testing,
manufacturing, billing, marketing as well as human resource related services.
According to Alipour & Mohammadi (2011), CRM is about captivating and engaging
clients to increase businesses for which firms need to recognise the significance of achieving
insights of their valuable clients. To encourage profitable growth, organisations must focus
on customers preferences by designing and constantly modifying communication skills and
business processes to convey and build outstanding customer experiences. By giving

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professional touch to every organisational level, loyalty within customers becomes visible
that acts as valuable assets for any firm ( Mishra & Mishra , 2009). It can also be said that
CRM is a combination of business process, individuals and technology which has been
designed to control and recognise organisation’s relations with customers by focussing upon
them through customer retention and relationship development. Nevertheless, the core
intention remains the same which is increase profits by obtaining equilibrium among client
contentment and corporate investments. However, Saeed, et al. (2010) argues that “most
researches concur with the finding that the relationship between satisfaction and loyalty is
neither linear nor simple”. Customer loyalty and satisfaction through interactions can
sometimes become difficult to be defined particularly when the situations become complex
and full of conflicts. The impact of customer loyalty can become complex which makes the
study of CRM address relationship issues also. Moreover, many organisations that
implements CRM often gets confused about what CRM actually is meant for and their
managers ends up struggling in finding out where CRM process can be started from. Pedron
& Saccol (2009) further supports the above statement by pointing out uncertainties in CRM
practices that may occur due to failure in understanding the implication of managing
practices and true meaning of relationship management.
In literature, relationship marketing is defined as an approach that has potentiality to
beat service intangibility along with making service-oriented business more suitable for
gaining service related creditability. By forming association with customers, the firm itself
gains customer loyalty, but personal relationships add further to it by accumulating larger
commitments ( Gupta & Sahu, 2012). There are various components through which CRM can
be organised in organisations and are clustered together depending to the type of situation
demanded to manage customer relationships (Saeed, et al., 2010). Few of them have been