Marriott's Merger with Starwood Hotels: A Strategic Analysis

Running head: MARRIOTT’S MERGER WITH STARWOOD HOTELS
MARRIOTT’S MERGER WITH STARWOOD HOTELS
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1MARRIOTT’S MERGER WITH STARWOOD HOTELS
Executive Summary:
The report throws light on the on the importance of strategic analysis and planning for
maximizing the growth of business. The strategic analysis has been discussed in the light of the
world-leading hotel, Marriott International after its acquisition of Starwood hotels. The report
highlights the business strategy of Marriott’s merger with the Starwood’s hotel and the
evaluation of its key stakeholders engaged in the hospitality business. This report further
elaborates the external analysis of Marriot using PESTEL and the Industry or competitive
analysis using Porter’s five forces model.

2MARRIOTT’S MERGER WITH STARWOOD HOTELS
Table of Contents
Introduction:....................................................................................................................................3
Evaluation of Levels of Strategy:....................................................................................................3
Corporate Strategy:......................................................................................................................3
Business Level Strategy...............................................................................................................4
Bowman’s Clock:........................................................................................................................5
Evaluation of Stakeholders:.............................................................................................................5
Internal stakeholders:...................................................................................................................6
Market stakeholders:....................................................................................................................6
External Stakeholders:.................................................................................................................6
External Factors Evaluation:............................................................................................................7
PESTEL Analysis:.......................................................................................................................8
Competitive Analysis:...................................................................................................................11
Conclusion:....................................................................................................................................12
References:....................................................................................................................................13
Appendix:......................................................................................................................................15

3MARRIOTT’S MERGER WITH STARWOOD HOTELS
Introduction:
A merger is a consolidation or amalgamation of more than two companies to form a
single company (Rothaermel 2015). When both the merging company wants to diversify, wants
to increase the economies of scale, gain competition or greater efficiency then it could result in
Merger (Madsen and Walker 2015). Merger and acquisition always depends on the scope and
direction of an organization. It is used in improving the performance of the company and
accelerates the growth rate. Sometimes such situations also arise that can force an organization to
accept acquisition or merger (Grant 2016). Strategy involves formulation of plans after analyzing
the environmental conditions then implementing it to achieve the goals and fulfilling the
stakeholder’s expectations.
The report highlights the strategical analysis of Marriott International’s acquisition of
Starwood Hotels. The Marriott International and Starwood Hotels are leading brands in the
hospitality sector, with its chain in the top cities of the world. This report further elaborates the
external and Industry analysis of the company. The merging of both the hotels will further fuse
the international footprints and life style brands of Starwood Hotels with Marriott’s luxurious
and personalised services (Hellier 2017). Guests will be offered many opportunities and will be
served the best from both worlds. The merger will further make Starwood and Marriott as the
world largest company leading in hotel business (Wood 2017). Using various levels of
frameworks and strategy the merger between Starwood hotels and Marriott International will be
analyzed.
Evaluation of Levels of Strategy:
Corporate Strategy:
Since 1927 Marriott International has been a leading industry in the hospitality segment
and still achieving great heights due to its corporate strategy. Before the merger was being taking
place, Marriott had too little international exposure with just 76% of its asset in North America
(Marriott.com. 2017). Though Marriott International has established core values, it was still
appealing to the upper-scale and mid-scale brands. Marriott long-term goal was to be the best
hotel in the world. More market shares were needed to be claimed at a global level for achieving