Strategic Planning for the Hospitality Industry

This document discusses strategic planning for the hospitality industry, focusing on the crucial factors to implement chosen strategies, creative strategies for competitive advantage, and various performance metrics. The case study revolves around Montcalm Marble Arch, a luxury hotel group based in London, England. It emphasizes the importance of technology, online presence, additional benefits, loyalty programs, and creativity in the hospitality industry. The document also explores critical success factors, key performance indicators, and the balanced scorecard approach. Get comprehensive study material and solved assignments on strategic planning for the hospitality industry on Desklib.

STRATEGIC
PLANNING FOR
THE HOSPITALITY
INDUSTRY

Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
Question1) Analyse the most crucial factors in order to implement chosen strategy...........3
Question2) Analyse creative strategies for chosen organization of hospitality industry in
order to get competitive advantage ........................................................................................5
Question3) Study and assess the various performance metrics.............................................6
CONCLUSION................................................................................................................................9
REFERENCE.................................................................................................................................10

INTRODUCTION
Strategies refers the policies, tactics that are formulated by a company in order to achieve
predefined goals. Report is about strategic planning that can be executed by organisations of
hospitality industry to get an edge over competitors (Camilleri and Neuhofer, 2017). Montcalm
Marble Arch has been consider in current report. It is one of the renowned luxury hotel group
based on London, England. It provide luxuries amenities to guest within London. The following
report focusses to choose an efficient strategy along with various factors that may influence it.
Furthermore, it emphasis to formulate creative plans in order to create a differentiation within
hospitality industry. At the end it consist several techniques to evaluate the overall performance
of business in an efficient manner.
MAIN BODY
Question1) Analyse the most crucial factors in order to implement chosen strategy.
Hospitality industry is very wide and important part of overall service industry. It
includes hotels, travel and tourism and many more. AS per the current scenario. There is an
extensive competition in hospitality sector. Every Hotel, restaurants are using different ways to
attract more number of customers. Various online platforms such as OYO, Airbnb and others
that are providing good service at reasonable price are the biggest threat for existing hotels. So
that it is essential for service sector companies to formulate efficient policies and strategies in
order to sustain at competitive market place for a longer period of time. In context of Montcalm
Marble Arch, following strategy can be used to get competitive advantage:
Enhance in Technology: Technology is an important factor that helps to increase in
number of customers of an organization. As per the current market trend, people give more
importance to technological advancements. It is essential to evolve new, advance and unique
ways to work in order to sustain at the market place. In today's digital world, it is important to
undertake various online platforms to enhance presence of company. Website plays a major role
to attract more number of buyers towards the organization. In context of Montcalm Marble Arch
Hotels. it is required to have strong digital media strategies (Rather and Hollebeek, 2019). Social
Media platforms such as Facebook, Instagram and many more help to connect with consumers in
more effective manner. Furthermore, Search engine optimization techniques are essential to
improve the ranking of web- page over various search engines. It will increase the presence of

organization among potential buyers. Now, people rely on online platforms to meet with their
needs. Thus, Company is required to have user friendly websites. Marketing Managers of
business entity are need to use internet platforms in an efficient manner where guest can check
the reviews, feedbacks and easily do the bookings (Maduekwe and Kamala, 2016). It will reduce
down the hassles to wait for a long time for check ins and check outs process. It enhances the
guest experience and overall brand image of company. Apart from this, they should adopt
robotics and automation to carry out business operations in an efficient manner. With
enhancement in technology now customers are able to use their smartphones as the key. Online
services has make the whole process like payment, order, bookings, check ins and check outs
more convenient for guest. They do not required to wait in the reception area like earlier. Hence,
with technological enhancement, organization can easily sustain and grow at competitive market
place for a longer period of time. There are a lot of factors that influenced selected strategy.
Some of them are given below:
Finance: It is the most crucial factor that influence technological enhancement of
Montcalm Marble Arch Hotels. Higher funds are require to use new and advance technology. In
order to carry out digital techniques, company is require to hire efficient staff. It will incur
higher cost and reduce down profit margin. Apart from this, Robotics and automation both are
expensive and they need to do huge investments in order to carry out theses practices. As
company have to arrange training programs for existing work force so that they can coordinated
with new advancements (Gilroy and et .al., 2017). It will not only influence expenses but also
significantly reduce the profit margin of company. From another prospective, it helps to increase
in number of guest. Thus sales of organization will also increase. Therefore. It will put both
positive as well as negative impact on revenue and profitability.
Human resources: Technical advancements will significantly affect human resources of
company. As organization need to make changes in present work force by appointing employees
who posses efficient digital skills. Mangers of company not only need to hire new work force
but also arrange training programs for existing employees. Robotics may replace the present
human resources of organization. Now, the activities that was previously performed by staff,
now that will done by robots. It may oppose by present staff members. Thus, these technological
changes also bring a huge modification in current employee base of business entity. So,

Managers of firm, should give due consideration to this factors while adopting new and evolves
techniques to work (Liu and Mattila, 2016).
With above discussion, it is analysed that enhancement in prevailing technologies is one
of the best strategies for hospitality industry. This tool is essential to get competitive advantage
and create a difference. But there are some elements such as finance, human resources that will
affect the implementation of selected strategy.
Question2) Analyse creative strategies for chosen organization of hospitality industry in order
to get competitive advantage
There is huge competition is prevailing in hospitality industry thus it is crucial to adopt
innovative and unique strategies for future to create a difference. It helps to attract huge number
of customers and get an edge over other competitors. As in service industry, there is face to face
interaction between service provider and receiver. So, it is important to provide value and
experience to customers in order to retain them for a longer period of time. Creative and
innovative ideas have great importance in hospitality sector. With these approaches organisation
can easily grab the attention of significant buyers that will increase sales and profit margins. In
case of Montcalm Marble Arch, managers of firm can adopt following strategies in order to
distinct themselves from other competitors:
Provide Additional benefits: Extra benefits always attract people. If people get some
additional in the same amount, they will get attracted towards it. Incentives is one of the best
way to distinct an organization in hospitality industry. Mangers of selected company, can get an
edge over other rivalries through giving some additional benefits such as discounts, free coupons
and many more. They need to provide compliment services to guest in order to attract them. This
positive gestures play an integral role in hospitality industry and help to enhance customer base
of organization ( Alrawadieh, Karayilan and Cetin, 2019). With this, they can provide an
experience and value to customers in order to retain them for a longer period of time.
Loyalty: Loyal consumers give preference to a particular brand and do not switch over
others. So organization should focus to create a loyal customer base who will do repetitive
purchases. For that, it is important to provide efficient services to guest and crate an experience
so that they visit again. In Montcalm Marble Arch, it need to render such kind of services to
guest so they do not switch over other brand. Loyal customers will not only avail services again
but also recommend it to others. It helps to create a positive brand image and goodwill at market

place. As, the organization is in hospitality industry where it is highly essential to have good
relationship with customers to create a difference. Hence managers of company should
concentrate to build long term relationship with guest rather than only earning profits.
Online Presence: Presence on various platforms such as social media, internet, is
essential to expand business and to grab the attention of more buyers. There are a lot of sources
such as Websites, blogs, email and others to connect with target segment. Montcalm Marble
Arch, that is in hotel industry should make efficient utilization of digital platforms. Mangers of
company should review the content over websites and blogs and update it as per market trend.
Social media optimization techniques need to be use effectively in order to improve website
ranking on different search engines such as Google, Yahoo. As, per change in trend, they need to
post visuals, videos on social media accounts of organisation in order to engage customers. Apart
from this, they need to manage better ranking so that people can easily search them over
internet. This can be done through effective SEO techniques. So, they need to take help qualified
digital marketers who can enhance the presence of company. According to increasing
competition in service industry having strong online presence will assist the business entity to
sustain and grow ( Calof, Arcos and Sewdass, 2018).
Creativity: Innovation and creativity is important to survive hospitality sector. It refers
to provide some attractive, new experiences to customers. In the respective field, organization
may change in existing interior, theme in order to give value to guest. In reference of Montcalm
Marble, Managers of organisation need to adopt more creative ways to grab the attention of more
customers. They may change in existing designs, interior, food services as per the current market
trend. They may add some unique dishes in their existing menu that demonstrate their creativity.
It will help them to get an edge over other competitors.
From above explantation, it is monitored that there are several approaches that can be
adopt by an organization in order to sustain in hospitality sector. It states strategies such as
Online presence, additional benefits, Loyalty programs to create a difference and get competitive
advantage (Kapera, 2018).
Question3) Study and assess the various performance metrics.
Performance metrics refers to data and figure representation of a firm abilities, actions
and overall qualities. In which there are several form of performance metrics which includes
sales, profit ROI, consumer review, personal review and brand image of company at

marketplace(Kloutsiniotis and Mihail, 2020). In context of Montcalm Marble Arch some of
performance matrices is discussed below:
Critical success factor-
Critical success factors are those elements which company excel to survive at
marketplace. These factors in hotel industry is changes over a period of time this is due to the
high expectation of consumers and global competition (MENESES, 2020). In context of chosen
hospitality company, their mangers are more focused towards quality of management, flexibility
and location in order to attract new customers. For the same these are discussed below:
Location: In hotel industry the main factor for critical success is location. It is very
important instead of any other change in industry. A hotel which is not situated at little high-way
will not achieve success and growth in stipulated time even if they are offering superior survives
or ambitions to their consumers. So it is very necessary for the hotel industry to chose proper
location for operating their business.
Flexibility : It is an other factor that plays vital role in hotel industry for critical success.
This is because consumers have different expectation of hotel for this mangers need to posses
authority to devise decision to accommodate then if possible. Through this they will be able to
earn more reputation in front of their consumers.
Key performance indicator-
Key performance indicator is used by an organization to measure its performance in
terms of success and growth. In hospitality industry it is important to set effective strategic goal
and for which selection of proper KPI is need as it is directly dependent on gaining the
understanding of what is important for the company. It becomes most frequently used term in
hospitality business for developing the understanding about financial diverse of hospitality
business i.e. food, beverages, accommodation, liquidity and profitability. In which
accommodation is the most costly product in term of generating revenue for hotel (Park,
Krishnan and Ha, 2019). In context of Montcalm Marble Arch, they use this factor in order to
provide clear goal and objective to employees for understanding how they can relates their
overall success with growth of organisation. KPI is measurable factors related with objective of
company that includes average rate of room, cost per occupied room, revenue available per room
etc. the key performance of Montcalm Marble Arch are as follows:

Accommodation Food Beverages
Average room rate Cost of sales ratio Cost of sales ratio
Bed room occupancy rate Gross profit ratio Gross profit ratio
Revenue per available room Average spend per ratio Average spend per ratio
Cost per occupied room / ARG Labour cost ratio Labour cost ratio
Hotel industry use indexes to evaluate the performance in basic three area average daily
rate (ADR), occupancy and Revenue per available room. Whereas an index of 100 refers to hotel
is able to capture a fair share in comparison to other group of hotels.
Average room rate refers to average revenue of room per occupied room for a particular
period of time. It is also known as average daily rate.
Bedroom occupancy rate means percentage number of room sold per number of room
available
Occupancy percentage rate tends to ration of total number of occupied room to the total
number of available room for sale.
Average room rate per guest (ARG) refers to total revenue of room per number of guest
in hotel.
Revenue available room can be calculate by dividing the total guest room revenue of
hotel by room count within a period of time.
Balance scorecard-
Balance scorecard is used to attain the objective, initiatives and goal of company as well
as for the development of strategic objective and initiatives. It permit leaders of hotel to move
towards strategic objective in a streamlined manner along with this, it aids company to provide
feedback for improving various internal function of business for their better outcome (Yang, and
et.al., 2020). In which the revenue per guest and revenue per available room is the basis financial
metrics which is found on top level of balanced scorecard for hotel industry. Another factors that
it includes is maintenance cost and quality metrics which directly affects the earning per share
and net profit of company. In context of Montcalm Marble Arch, this factor assists firm to
collect customer feedback about their satisfaction with current services in order to improve their
internal activities according to the demands and preferences of consumers.

CONCLUSION
With above report it can concluded that it is essential to formulate effective plans and
strategies to survive in this competitive world. Discussion has been carried out regarding the
creative, unique techniques such as strong online presence, loyalty programs and many more in
order to distinct offerings within services industry. It states the importance of technological
advancements to attract more number of customers. The above report consist significant
information about various techniques that are used to monitor the impact of strategies on
business operations. Hence, it can be concluded that the report includes significant insights
regrading the strategies and policies for the enhancement of organizations within hospitality
sector.

REFERENCE
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