Strategic Planning for Hospitality Industry Assignment
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Added on 2020-11-12
Strategic Planning for Hospitality Industry Assignment
Added on 2020-11-12
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STRATEGIC PLANNINGFOR HOSPITALITYINDUSTRY
Table of ContentsINTRODUCTION...........................................................................................................................3TASK 1............................................................................................................................................3Knowledge and understanding about most popular strategic options....................................3TASK 2............................................................................................................................................6Critically analyse the factors affecting implementation of strategies....................................6TASK 3............................................................................................................................................9Analyse and evaluate the different performance metrics of Hilton........................................9CONCLUSION.............................................................................................................................11REFERENCES..............................................................................................................................12
INTRODUCTIONHospitality also known as service industry is a vast sector which is consist oftransportation, event planning, cruise line, theme parks, hotels and many more. This report willbe studying about Hilton Worldwide holidays Inc. which is an American multinational hotelcompany. The respective organisation operates in near by 109 countries. Similarly, the totalnumber of properties of the respective hotel chain are more than 5,500 (Phillips and Moutinho,2014). The respective hotel have near by 15 brands some of which are Conrad hotel and resorts,canopy by Hilton, Doubletree, Hilton hotel and resorts, and many more. The respective hotelhave its headquarters in Virginia, United States. Similarly, the number of employees of therespective hotel chain is very vast which is near by 1,63,000 till 2017.The revenue of HiltonWorldwide is approx £1.80 billion which reflects a continuous growth of the hotel organisation.This report will discuss about various popular strategic option which are adapted by therespective organisation such as management contract, franchising and many more. Addition tothis, report will also study different factors that affects the implementation of strategies such ashuman resources, leadership, structural design, etc. Furthermore, the file will help in betterunderstanding about different performance metrics in various context such as CSF, balance scorecard, etc.TASK 1Knowledge and understanding about most popular strategic options.In order to expand the business, a company adapts variety of strategies which suits theirorganisational structure and objectives. Expansion plays a vital role in an organisation as it helpsin more profit earnings and enhance the reputation of the company. Addition to this, it helps indelivering its services to more customers and helps in minimising the external risks in the marketsuch as competition, technology, price, etc. Thus, Hilton Worldwide can adapt various options toexpand their business in different countries. However every method has its own advantages anddisadvantages. Some of the strategies are franchising, management contract, joint ventures,merger and acquisitions. To have a better understanding about these factors, a discussion ismentioned below:Franchising- It can be defined as an arrangement in which an individual or the franchisergrants the other party known as franchisee, a right to use its name or trademark along with a set
of business system and processes in order to deliver products and services in the desired market(Theobald, 2012). Addition to the, the franchisee has to pay certain amount of fee which isusually a one time payment along with a fix percentage of sales revenue which is called royalty.Hilton hotels have 221 franchise all over the world (HILTON HOTELS AND RESORTS, 2018).However there are certain benefits and disadvantages which are mentioned below:AdvantagesThe rate of success of these franchise are generally high which works as a positiveintroduction of company in the new market.No experience is needed as trainings are provided by the franchisors in order to maintainthe values and brand image of the company.The cost involved in franchise is usually less than other alternatives which does notburden the company to invest in expansion.DisadvantagesIt binds the franchisor and franchisee in a formal agreement due to which both of themget responsible for further loss and other issues.The performance of franchise becomes tough to control.It is a productive way of expanding the business which can help in earning more profitfor Hilton Worldwide. Thus, Hilton worldwide should carefully analyse these factors and theninvest in this strategy. Management Contract- It is an agreement between the company and a managementorganisation which are hired for managing or coordinating the company or the contract. In thismethod, the organisation hires a management company in order to perform the specific task. Inreturn for the services, the owner company provides certain amount of compensation to themanagement company (Swanson and Edgell, 2013). It is the best solution for the hotelcompanies which is been adapted by various big hotel organisations. Thus, these contracts oftentake control on the whole hotel operations. Addition to this, these management companies areresponsible for controlling guest services, marketing management, maintenance of the propertyetc. For example, Hilton have management contract for Beijing, Conrad hotel in China, andmany more. The advantages and disadvantages are mentioned below:AdvantagesThis style of expansion helps in saving time and resources of the company.
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