Strategic Hotel Management

This report deals with the strategic management of HOTS hotel in the context of Australia. The analysis of the environmental factors in the context of this business will be analyzed in this section.

Running head: STRATEGIC MANAGEMENT
Strategic Hotel Management
Name of the Student:
Name of the University:
Author’s Note:

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Executive Summary
This present report deals with the strategic management in the context of HOTS hotel. However,
this organization has adopted the positioning strategy to identify the changing demand of the
customers. This will help them to maximize their sales revenue generation by satisfying the
customers. On the other hand, such strategy will be helpful to detect the nature of the business
and the competitors. However, the macro and micro environmental analysis also focus on the
current status of the hospitality industry as well the HOTS hotel in Australia, which will allow
this organization to adopt a suitable strategy for their growth.

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Table of Contents
Introduction......................................................................................................................................4
Analysis of Macro and Micro-environment....................................................................................4
PEST analysis in the context of HOTS............................................................................................4
Porter Five Forces analysis in the context of HOTS hotel..............................................................5
Porter’s Value chain analysis...........................................................................................................7
Discussion of the overarching business strategy.............................................................................8
Ethics, objectives and the CSR activities in business......................................................................8
Discussion of the strategic direction................................................................................................9
Recommendations..........................................................................................................................10
Conclusion.....................................................................................................................................10
References......................................................................................................................................11

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Introduction
Strategic hotel management refers to the implementation and the formulation of the
business goal in the context of the hospitality sector. In order to gain competitive advantage
strategic management is crucial for the hospitality sector by analyzing its micro and macro
environment (Harrington, Chathoth, Ottenbacher & Altinay, 2014). The objectives, plan, and
design of a business are developed by the strategic management planning. This study deals with
the strategic management of HOTS hotel in the context of Australia. The analysis of the
environmental factors in the context of this business will be analyzed in this section.
Analysis of Macro and Micro-environment
PEST analysis in the context of HOTS
Political factor
The political environment of Australia is stable as the government in Australia changes
after 3 years. On the other hand, Australia is a democratic nation thus the political rules do not
affect the flow of the business in this country (Galliers & Leidner, 2014). This will give a good
opportunity to the HOTS hotel to enhance their business as well strategic management approach
in this country.
Economic factor
Australia is one of the growing economic countries among the developing countries. Its
high GDP ensures its stable economic status. However, the commercial property price is high
(Pavlatos & Odysseas, 2015). Despite this stable economy economic recession in the year 2008

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has left a negative impact on the Australian economy. Therefore, the hospitality sectors in
Australia have been growing rapidly, which ensures that HOTS hotel will expand their business
in Australia by establishing headquarters in this country.
Social factor
The social factor is a big economic factor that leaves a big impact on the external
environment in a business. Australia is a multicultural country with a huge number of
immigrants. On the other hand, maximum people of Australia belong from the working class and
they focus on high lifestyle (Kremer & Symmons, 2015). This will bring a good opportunity for
the HOTS hotel to maximize their performance by getting a large number of visitors in Australia.
Technological factor
Australia is one of the developing countries with rapidly emerging technology. This
country contributes a good value in the R&D program. As a result, the country is technologically
more advanced (Pavlatos & Odysseas, 2015). The hospitality industry gets a scope to utilize the
technology to grow their business by embracing customer-oriented strategy in their business
activity.
Porter Five Forces analysis in the context of HOTS hotel
Application of the Porter's Five Forces model is an effective approach to analyze the external
environment of an organization as well as the competitive advantage of an organization. A threat
of new entrants, industry rivalry, bargaining power of the customers, bargaining power of the
suppliers and threat of alternative product are the major components of this model (Dobbs,
2014).

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Threat of new entrants
In the context of Australia, the threat of new entrants is low. However, in hospitality
industry huge funding is required. Treat of the new entrants is a big challenge in any business
industry (Yunna & Yisheng, 2014). For the HOTS hotel, the entry of new business in the similar
industry is quite difficult.
Bargaining power of the buyer
The bargaining power of the customers refers to the capacity of the customers to lower
the price of a product or a service (Mathooko & Ogutu, 2015). This depends on the number of
customers that a company has. In the context of Australia, a major number of international
tourists come as they have a high attraction towards the Australian tourist's spots. On the other
hand, they are more concerned about the quality of the hotels in Australian hospitality sector.
Thus, bargaining power of the customers is medium in the context of HOTS hotel.
Bargaining power of the supplier
Bargaining power of the suppliers refers the capacity of the suppliers to maximize the
price of the raw materials. This depends on the number of the suppliers present in an
organization and how much cost is required for an organization to switch from one supplier to
another (Yunna & Yisheng, 2014). In Australia many suppliers are present as a result; the power
of the suppliers is low in the context of HOTS hotel.
Industry rivalry

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Industry rivalry focuses on the existing competitors in the similar industry and same
market segment. The number of competitors in the same industry and their capacity to threaten
will be analyzed to understand the current competition. In the context of HOTS hotel this is high
as in Australian hospitality industry there are many strong competitors as this industry is going
rapidly. As for example, Qualia Great barrier reef, Bamurru Plains and Longitude 131 are the
major competitors of HOTS hotel in Australia.
Threat of substitute products
The substitute threat is high for HOTS hotel as many competitors offer the similar
alternative products. In the hospitality industry, the maximum products are similar and contain
same price due to huge competition (Dobbs, 2014). Thus, there is a big threat of the alternative
product in the context of HOTS hotel.
Figure 1: Porter Five Forces Analysis
(Source: Dobbs, 2014).)

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Porter’s Value chain analysis
Porter value chain analysis highlights the way through which an organization creates their
business value by using the raw materials to create the high-quality products or service. Inbound
logistics, outbound logistics, marketing, service, and operation are the major elements of the
Porter value chain (Savino, Manzini & Mazza, 2015). In the context of HOTS hotel, their
logistics process is effective as it utilizes the resources properly as a result, this organization is
able to create value for them and to achieve the competitive advantage. HOTS hotel provides
mainly the accommodation facilities especially the room facilities. However, the sales and
marketing department focus more on the investment of each aspect of the operation process.
Therefore, every step of the business operation in HOTS hotel includes a dynamic nature to add
value in the business by gaining competitive advantage. They have regular monitoring process
for their entire service process and they keep low inventory to reduce the waste as well as the
operation cost.
Figure 1: Porter value chain analysis
(Source: Savino, Manzini & Mazza, 2015)

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Discussion of the overarching business strategy
Vision: The vision of HOTS hotel is to enhance the customer loyalty by having a long-term
impact on their customers those come to visit in their organization. They focus to leave a positive
impact on both local and potential customers. HOTS hotel wants to be the first choice in the
Australian hospitality industry. As a small and medium-sized organization it will be difficult for
HOTS hotel to cover a large portion of the Australian hospitality sector in the first year.
Mission: The mission of HOTS hotel is to reveal their business scope in front of their employees
and to allocate the resources properly as per the requirement.
Ethics, objectives and the CSR activities in business
The main business objectives of HOTS hotel are:
 To understand the current market demand
 To satisfy the customers by using strategic hospitality management
 To gain competitive advantage by making competitor analysis
Trustworthiness, fairness and the accountability are the main three business ethics of HOTS
hotel. However, it is crucial for a business to keep transparency to build trust in the customer
domain (Diffley, McCole & Carvajal-Trujillo, 2018). However, HOTS hotel focuses on the
customer-centric business and they make an online transaction by keeping the customer
information confidential.
The hospitality sector needs to take CSR activities in their organization to create the brand
awareness and to retain the employees (Kim, Rhou, Uysal & Kwon, 2017). However, employees
always prefer to work with an organization that has a positive image in the market (Kim,Woo,

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Uysal & Kwon, 2018). In the context of HOTS hotel, they have taken 3Rs approach to
implement the greening operation in their supply chain management. This CSR activity is one
vital part of their strategic management. Such 3Rs approach allows this organization to reduce,
recycle and reuse the waste that occurs in their supply chain management.
Discussion of the strategic direction
The established vision, mission, CSR activity and business objectives affect operation
process of HOTS hotel. In the recent years, the hospitality sector has been facing challenges due
to the continuously changing demand of the customers (Gannon, Roper & Doherty, 2015). This
is the main issue of HOTS hotel as they are facing difficulties to satisfy the customers.
Implementation of the positioning strategy will leave a positive impact on this organization.
This strategy will help them to make an analysis of the products, service and the status of the
competitors. They their levels of the managers such as top, middle and low-level managers are
involved in the implementation of this strategy through managing changes, solving a problem
and maximizing the performance of the organization. Positioning strategy will be applied to
differentiate the products of HOTS hotel from their competitors by taking customer insight
analysis. This will be effective to increase the revenue by satisfying the customers. As this
decision will be taken in the next year then the company has no need to worry about the increase
of local community as well as the potential customer’s number.

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Recommendations
 Use of low pricing strategy will be helpful for HOTS hotel to maximize the number of
customers by covering customers from all classes.
 Market analysis strategy will be beneficial to enhance the revenue by identifying the
current market need and the position of the competitors. Based on such analysis HOTS
hotel will offer innovative service to enhance their sale.
 By utilizing the modern technology and choosing the right target audience HOTS can
improve the Mgt.
 Providing the discount to F&B section during the festive season will be an effective
approach for HOTS hotel to increase their sale.
Conclusion
The entire piece of work reveals the vision, mission, objectives, CSR activity and the
strategic direction in the context of HOTS hotel. However, adoption of the positioning strategy
will be beneficial for them to cope up with their current problems. Therefore, development of the
customer-centric business is their main aim, which can be fulfilled by this strategy. Moreover, it
can be concluded that integration of the strategic hospitality management with the CSR activities
will be an effective approach for the HOTS hotel.

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References
Diffley, S., McCole, P., & Carvajal-Trujillo, E. (2018). Examining social customer relationship
management among Irish hotels. International Journal of Contemporary Hospitality
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analysis templates. Competitiveness Review, 24(1), 32-45. doi.org/10.1108/CR-06-2013-
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Galliers, R. D., & Leidner, D. E. (Eds.). (2014). Strategic information management: challenges
and strategies in managing information systems. Routledge.
Gannon, J. M., Roper, A., & Doherty, L. (2015). Strategic human resource management: Insights
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2013-0576
Kim, H. L., Rhou, Y., Uysal, M., & Kwon, N. (2017). An examination of the links between
corporate social responsibility (CSR) and its internal consequences. International Journal
of Hospitality Management, 61, 26-34. doi.org/10.1016/j.ijhm.2016.10.011

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Kim, H., Woo, E., Uysal, M., & Kwon, N. (2018). The effects of corporate social responsibility
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