Strategic Hospitality Management: Formulation, Implementation, and Evaluation

This report discusses the concept and process of strategic management in the hospitality industry, with a focus on Marriot hotel. It explores analytical tools and models, corporate strategy formulation and implementation, challenges and issues, and effectiveness evaluation. The report also includes a literature review and related case studies.

Strategic Hospitality Management
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TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................3
Corporate strategy formulation........................................................................................................3
Strategic management applicable to hospitality industry............................................................3
Analytical tools and models.........................................................................................................4
Critical evaluation of industry practices..........................................................................................6
Literature review and related case studies...................................................................................6
Corporate strategy formulation process.......................................................................................6
Corporate strategy implementation and management process....................................................7
Challenges and issues..................................................................................................................8
Effectiveness................................................................................................................................9
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................11
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INTRODUCTION
Strategic management is defined as the process to create or implement the focused goals so
that business service providers can enhance their status within competitive industry. Hospitality
organisations used to face huge competition so it becomes essential for them to manage and
identify potential resources and opportunities and to enact accordingly (Le and Phi, 2021).
Strategic management helps organisations to work in appropriate direction which can contribute
in the growth and success of firms. Effective strategic practices also provide better and clear
vision to employees so that they can understand their job role and organisational requirement.
The aim of this report is to understand the concept and process of strategic management and
its contribution in making organisations grow. The key objective of this assignment is to help
understand various analytical tools for strategy formation and to explore the strategy formation
and implementation process. This report will consider the case study analysis of Marriot hotel
which is one of the most successful hospitality chain in UK. It will provide a literature review on
formation of organisational strategies. The study will also provide a discussion of related
challenges and the ways to measure and maintain the effectiveness of organisational strategies.
Corporate strategy formulation
Strategic management within hospitality
Strategic management is defined as process of developing, implementing and monitoring
decisions so that organisations can achieve their goals. It also specifies process, policies and plan
to achieve desired goals.
Strategic management in hospitality service providers: The hospitality industry used to have
strong competition and thus for organisations like Marriot, Hilton and Travelodge it is required
that creative and effective strategies must be applied to enhance customer experience and
organisational success. These strategies are focused upon four major aspects including brand
development, raising customer value, meeting operational excellence goals as well as
contributing in corporate social responsibility (Ferreira, Mueller and Papa, 2018). To build good
brand value organisations like Marriot adopt advance marketing methods, loyalty cards and good
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customer services. To meet operational goals hotel used to ensure regular supply and focus on
standard and high quality products and services offered to customers.
Strategic management process consists of following stages: Corporate strategy formulation
includes selection of most suitable and efficient method to meet organisational goals. It uses
analytical tools to align resources, goals and processes.
Goal setting: In first stage hospitality organisations like Marriot used to define clear objectives
and goals which align with organisational vision. For instance, the goal of Marriot is to enhance
its sales or services by 10% within one year. Thus all strategies and actions of organisation will
depend upon this goal. The realistic, detailed and accurate objectives helps to plan and utilise
resources effectively. In corporate strategies various elements such as specific nature,
measurement, realistic behaviour as well as time also plays an important role in determining
strategic goals and objectives.
Analysis: In this phase all necessary information is gathered so that business needs can be
understood and strategies can be framed. The internal and external parameters are assessed to
measure and consider their impact on strategic process (Bulturbayevich, 2021). Hospitality
organisations like Marriot also analyse current industry trends, competitors as well as own
capabilities to analyse the need and choices of strategies.
Strategy formulation: To formulate the strategies analysed information is review so that their
alignment with the existing resources can be determined. The risk factors and strategic barriers
must also be identified by organisations like Marriot and eliminated to formulate effective
business strategies. While formulating strategies organisations used to set quantitative targets
which can be achieved in fix time period so that performance trajectories can be measured and
improved.
Strategy implementation: To obtain competitive benefit Marriot must also accurately implement
strategies. If strategies do not align with the business structure or vision, then it can result in
failure and risks.
Control and evaluation: In the last phase of strategic process applied strategies must be evaluated
with key performance indicators or measured parameters (Camilleri, 2020). The continuous
monitoring and control methods will assist Marriot in bringing considerable changes in making
required improvements in the process.
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Analytical tools and models
Strategic planning process not only helps hospitality organisation Marriot to assess its
drawbacks and limitations but also assist in exploring the potential opportunities. For focused
and long term planning it is required that appropriate strategic planning models and effective
analytical tools are used. Some of the most effective tools and models are as follows:
Balance scorecard: This tool considers operational as well as financial metric to evaluate the
performance of applied strategies within Marriot. In this tool four parameters: quality, time, cost
and service are evaluated and their outcome is referred to particular reference point for
performance measurement and goal setting. The reference point includes financial profitability,
organisational capacity, customer perspective and internal process.
SWOT and VRIO analysis: To effectively implement the strategies hospitality organisations
must be aware about their own capabilities and potential. Clarity of weakness and threats can
help Marriot to take suitable measures on time while the understanding of strength and
opportunities help to gain strong competitive positioning by utilising their strong organisational
parameters. It is also critical that organisations must have necessary resources for
implementation of strategy (Hitt, Ireland and Hoskisson, 2019). For this purpose, VRIO analysis
can act as an important tool. In VRIO analysis various types of organisational resources such as
human resources, technical, financial or knowledge are classified as valuable, rare, imitable and
organised. This classification helps in accurate and optimised use of resources so that
productivity can be improved and strategic goals can be achieved.
PESTEL analysis: To formulate the effective strategies it is also important that organisations
must consider governing factors which affect the hospitality operations. Thus hospitality service
providers also use PESETEL analysis. With this analytical tool Marriot can identify and assess
the political environment and regulations, economic trends and conditions, social trends and
changes, available technology for supporting operations, environmental factors and key
legislative politics which guide and control the decisions making and operational concerns of
business. This analytical result help organisation to formulate strategy which can align with
mentioned environmental factor and can bring optimum business productivity.
Porter 5 force: Strategic implementation is all about getting competitive benefits. Thus
implemented strategies must be unique and highly productive in terms of gaining competitive
advantage (Steiss, 2019). For this purpose, it is equally crucial to analyse the competition
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available in the industry and market. This can be done by using porter 5 force model. In this
model different elements such as threat of substitution, competitive rivalry, supplier and
customer power as well as threat of new entrants into industry is identified. This analysis is vital
in making strategies feasible in terms of dynamic nature of business, cost and competition.
Critical evaluation of industry practices
Literature review and related case studies
According to Gavurova and et.al., (2020) strategic planning is an important aspect for the
competitive survival of organisations. If hospitality firms like Hilton and Marriot are not able to
build and implement appropriate strategies in response to marketing changes then it can lead to
several disadvantages as well as customer dissatisfaction. For instance, digital technologies have
become an inevitable part of the business. Thus organisations like Marriot are also using
strategic planning to integrate their business functions and operations with technology. This can
be seen in online booking services, performance monitoring as well as customer interaction.
Demir, (2018) stated that if contemporary firms do not focus on effectiveness and suitability of
their strategies then they will never be able to survive the growing rivalry. Marriot is able to
achieve immense success and popularity because its growth and operational strategies are in
alignment with the long term vision of the firm. Its strategies also used to consider factors such
as competition, resources, stakeholder perspective as well as market needs. If strategic formation
process is not taken as an important aspect, then Marriot will never be able to recognise the
situational and business needs and thus ultimately its sustainability profitability may get threaten.
As per the view of Adoli and Kilika, (2020) success is not only ensured by implementing
good operational and business strategies instead it demands for regular monitoring and
evaluation. Whenever Marriot implement any strategies it used to take feedback from its
customers and uses different performance matrices so that it can understand the gaps in strategy
formation and implementation. If organisation fails to meet the performance metrics, then it used
to give them a chance to assess their own strategies and actions. Thus essential changes can be
incorporated into planning and decision making process so that customers of Marriot can receive
high quality services as per their expectation (Fatima and Elbanna, 2020). Without evaluation of
key performance indicator and strategy planning process Marriot may not be able to recognise
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the actual need of their target customer segment and industry practices. This will contribute in
organisational failure at industry or organisational level.
Corporate strategy formulation process
Strategic formation process consists of several phases which must be analysed and
priorities individually by Marriot to obtain the desired outcomes (Aladag and et.al., 2020). The
strategic goals of Marriot are not only based upon its vision but also consider the dynamic
business environment so that goals formulated are capable to provide sustainable growth and
profitability. Many competitors of Marriot in hospitality sectors used to formulate strategic goals
without informing to their team members or stakeholders. This used to create conflicts as well as
higher level of ambiguity which affect the strategy deliverables. If there is disagreement among
any of the stakeholders regarding proposed strategies, then organisation may experience
ineffective outcomes in the end outcomes. Hence goal formation must not only be clear but it
must be quantitative as well as time bounded also (Konovalova and et.al., 2018). Once the goals
are clear Marriot must analyse the business environment. The lack of resources, choice of
customers, competitive trends and industry related changes can affect the efficiency of the
strategy proposed.
Thus before choosing any strategy these factors must be closely monitored and assessed.
Use of advanced analytical tools can act as best way to assess the situations and to choose the
best available strategies. In the next phases of corporate strategy formation when Marriot
implement strategies then several risk factors and limitations can occur (Poddubnaya, 2019). For
instance, lack of resources or time boundaries can act as critical barrier for the organisation to
implement the required strategies in desired manner. Thus it is equally important that for
strategic implementation available resources must be analysed deeply and if required new
resources must also be taken into consideration. Lack of creativity is one of the reasons that
many hospitality organisations are not able to survive in the competition and thus they fail to
achieve performance goals (Le and Phi, 2021). Thus when implementing strategies organisation
must ensure that creative and advanced methods are employed by the team members. In the last
phase when strategies are implemented Marriot also used to ensure that it measures the outcomes
and their relevancy as expected. The feedback from the customers, competitive performance,
market analysis and financial outcomes act as good measures to determine the impact and
effectiveness of the implemented business strategies. These strategic process when followed with
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competitive perspective used to deliver high growth and success to the organisation even in the
industries in which fierce competition exists.
Corporate strategy implementation and management process
In strategic implementation process Marriot used to execute the set strategies and plans so
that organisational goals can be accomplished. For successful implementation of strategies, it is
required that employees and team members must be clearly informed about the purpose, method
and need of bringing strategic changes (Koseoglu, Law and Dogan, 2018). It is possible that staff
members of hospitality services may face resistance from the employees but it is the
responsibility of the leaders to ensure that all team members must agree to proposed strategies.
Once the team members are agreed and aware about the strategies goals organisation must ensure
that team members have all necessary resources to achieve those goals (Majid and et.al., 2019).
Owing to the diverse and regularly changing customers’ needs it can be a challenging aspect for
the hospitality organisations. However, they must achieve this by using suitable tactics and
procurement process. In order to implement the strategies in effective manner organisations must
use advance and correct resources. If staff members are not capable enough to contribute in
strategic changes or implementation, then they must be given suitable training and support
services.
In order to make effective strategic implementation Marriot must also ensure that at
functional level also regular monitoring is done by the upper management. The monitoring must
also include evaluation process so that strategic implementation does not deviate the strategic
goals or organisational requirement. The evaluation and monitoring process also put foundation
for the future changes so that competitive strategies as well as business strategies can be
implemented with greater care and focus (Konovalova and et.al., 2018). While implementing
strategies organisations must also consider the associated risk factors which can affect the
outcomes of strategic management.
Challenges and issues
The strategic implementation is not an easy task for the hospitality organisations as it
involves several challenges and concerns. The most common challenge which lead to strategic
failure is lack of clarity in desired goals and objectives. Many hospitality firms are not able to
clearly understand the needs of their customers and vision. Thus the strategic objectives
formulated result in ambiguity and individuals does not work in desired direction. This is one of
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the reasons that organisations are not able to grow (Le and Phi, 2021). Another challenge in
effective strategic process is ineffective communication. Strategic management not only involves
the decisions makers but also affect various stakeholders (Aladag and et.al., 2020). Hence it is
equally important the strategic outcomes and process must be clearly informed to all
stakeholders otherwise it can cause disagreements and ineffective implementation.
Contemporary hotels such as Marriot used to face very tough competition in terms of service
quality and employee skill.
Thus it becomes vital for the firm to use advance and most appropriate analytical tools so
that effectiveness of strategies can be maintained. The poor analysis does not allot organisations
to implement strategies which can deliver competitive advantage. Many organisations also fail to
maintain the transparency and efficiency in terms of maintaining monitoring and tracking of
strategic implementation. As a result of this real time attainment of gaols is influenced and
applied strategies fail to bring advantages in real world.
When tracking and control process is not appropriate then organisations also fail to
measure their strategic performance. It is also one of the key challenges which hinder the
strategic growth of organisation. Another crucial issue faced by hospitality organisations is
resource limitations. On many instances organisations have to implement and plan certain
strategic choices (Majid and et.al., 2019). However, they do not have necessary resources and it
impose a limitation on strategic planning of the organisation. The lack of suitable communication
and analytical tools can also increase the gap between desired performance outcomes and
planned strategies. If strategic direction and process is not clearly informed to stakeholders and
team members then they cannot be implemented in required manner and performance may get
affected.
Effectiveness
Measurement of strategic effectiveness is equally required and significant as process of
strategy formation and implementation. Though organisations such as Marriot used to pay great
emphasis on strategy management but they must regularly monitor and measure the effectiveness
of strategies. It permits organisation to address and identify the performance gaps and to improve
strategies for meeting those gaps (Emeagwal and Ogbonmwan, 2018). One of the best measure
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used by Marriot to measure the effectiveness is to analyse the feedback or response received
from its customers. The organisation used to regularly review the rating agencies, social media
response and feedback from its guests so that it can improve customer experience and
operational strategies. Strategic objectives of Marriot also consist of some financial or
quantitative goals. Thus to measure effectiveness organisation assess its ability that if it has
achieved set goals or not.
The failure to achieve those financial targets clearly show that there is lack of effective
planning and implementation (Hitt, Ireland and Hoskisson, 2019). In such situation organisation
used to assess its own functional aspect as well as industrial or competitive trends. This can be
done by assessing and monitoring the performance and strategies of competitive firms so that a
comparative review can be obtained. The comparative analysis of strategies is one of the most
efficient and productive way to measure and assess the strategies. The large size organisations
such as Marriot used to have high clarity in terms of long term goals and vision. Thus another
way used by such organisations to measure the effectiveness is to compare the strategic outcome
with the vision of organisation. There are situations when certain strategic decisions do not align
with the values, ideology and vision of organisation. Such kind of strategies which conflict with
the brand perception or value are usually avoided by firms and are considered as less effective by
them (Köseoglu and et.al., 2019). Thus it acts as good way to measure and ensure that applied
strategies are effective.
CONCLUSION
From the above discussion it can be concluded that accurate formation and implementation
of strategies can help companies to achieve and enhance their performance goals. This should be
considered as continuous process which not only appraises organisational and industrial practices
but also appraises competitors and future threats. It has been also analysed from the above
discussion that contemporary businesses must refer to the effective strategy management process
so as to gain competitive advantage. The lack of strategy planning process can make
organisations lack efficiency and productivity. It has been also evaluated from the above
discussions that use of various analytical tools in strategic management process is helpful and
valuable in terms of assessing organisational current performance and to identify the market and
business needs. It results in incorporating several improvement plans which can help businesses
to achieve their corporate goals. Further it can also be suggested that strategy process must be
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implemented with due observation and planning. The related challenges can impose considerable
threat for the firm to achieve their strategic goal. However, use of suitable planning and analysis
tool can be helpful for the organisation to overcome those challenges.
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REFERENCES
Books and Journals
Adoli, H.L. and Kilika, J.M., 2020. Conceptualizing the role of leadership strategy in the
context of strategic management process: A review of literature. Journal of Economics
and Business, 3(4).
Aladag, O.F., and et.al., 2020. Strategy implementation research in hospitality and tourism:
Current status and future potential. International Journal of Hospitality
Management, 88, p.102556.
Bulturbayevich, M.B., 2021, February. IMPROVING THE MECHANISMS OF STRATEGIC
MANAGEMENT OF INNOVATION PROCESSES IN ENTERPRISES. In Archive
of Conferences (Vol. 15, No. 1, pp. 130-136).
Camilleri, M.A., 2020. Strategic corporate social responsibility in tourism and
hospitality. Camilleri, MA, Strategic Corporate Social Responsibility in Tourism and
Hospitality. Sustainable Development, pp.1-3.
Demir, F., 2018. A strategic management maturity model for innovation. Technology innovation
management review, 8(11).
Emeagwal, L. and Ogbonmwan, K.O., 2018. Mapping the perceived role of strategic human
resource management practices in sustainable competitive advantage. Academy of
Strategic Management Journal, 17(2), pp.1-19.
Fatima, T. and Elbanna, S., 2020. Balanced scorecard in the hospitality and tourism industry:
Past, present and future. International Journal of Hospitality Management, 91,
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Ferreira, J., Mueller, J. and Papa, A., 2018. Strategic knowledge management: theory, practice
and future challenges. Journal of knowledge management.
Gavurova, B., and et.al., 2020. Strategic Management in SMEs and its significance for
enhancing the competitiveness in the V4 countries-a comparative
analysis. Management & Marketing-Challenges For The Knowledge Society.
Hitt, M.A., Ireland, R.D. and Hoskisson, R.E., 2019. Strategic management: Concepts and
cases: Competitiveness and globalization. Cengage Learning.
Konovalova, E.E., and et.al., 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.
Köseoglu, M.A. and et.al., 2019. Intellectual structure of strategic management research in the
hospitality management field: A co-citation analysis. International Journal of
Hospitality Management, 78, pp.234-250.
Köseoglu, M.A., and et.al., 2020. What are the key success factors for strategy formulation and
implementation? Perspectives of managers in the hotel industry. International Journal
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Koseoglu, M.A., Law, R. and Dogan, I.C., 2018. Exploring the social structure of strategic
management research with a hospitality industry focus. International Journal of
Contemporary Hospitality Management.
Le, D. and Phi, G., 2021. Strategic responses of the hotel sector to COVID-19: Toward a refined
pandemic crisis management framework. International Journal of Hospitality
Management, 94, p.102808.
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Le, D. and Phi, G., 2021. Strategic responses of the hotel sector to COVID-19: Toward a refined
pandemic crisis management framework. International Journal of Hospitality
Management, 94, p.102808.
Majid, A., and et.al., 2019. Role of network capability, structural flexibility and management
commitment in defining strategic performance in hospitality industry. International
Journal of Contemporary Hospitality Management.
Poddubnaya, N.V., 2019. Corporate culture as an effective instrument of strategic development
of tourism and hospitality enterprises. In Актуальные проблемы развития сервиса и
туризма (pp. 133-135).
Steiss, A.W., 2019. Strategic management for public and nonprofit organizations. Routledge.
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