Strategic Planning for the Hospitality Industry.

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Strategic Planning for theHospitality Industry
Table of ContentsINTRODUCTION...........................................................................................................................3BODY..............................................................................................................................................31. Strategic Options for Hilton Hotel..........................................................................................32. Analysis of factors that affect strategy implementation of Hilton Hotel................................53. Analysis and evaluation of different performance metrics for Hilton Hotel..........................7CONCLUSION................................................................................................................................8REFERENCES..............................................................................................................................10
INTRODUCTIONStrategic planning refers to methods used to creates different strategies for anorganisation, so that they are able to utilise their resources in an effective manner. Managementcomes together to ascertain visions and create goals that have to be achieved(Phillips andMoutinho, 2014). They make steps that have to be followed by the organisation's employees, sothat they can create proper strategies. They are implemented in a systematic manner, which helpsorganisation in working effectively and efficiently. Hilton Hotel is a famous hotel company thatoperates globally within the hospitality industry. It was founded in 1919 and has been offeringmany services to customers in different parts of the world. There are around 500 hotels andresorts that are operated by them. Their management has to perform certain activities, so thatthey are able to create strategies through proper planning. This assignment will study thedifferent types of strategic options that Hilton Hotel can use and critical analysis of differentfactors that can affect implementation of created strategies will be done. It will also analysevarious performance metrics of Hilton Hotel.BODY1. Strategic Options for Hilton HotelStrategic planning at Hilton Hotel is considered to be a difficult task due to analysis ofvarious factors(Strategic Planning,2018). They operate in different countries and managementhas to ensure that they pick best strategic option for the organisation.FranchisingFranchising refers to the act of expanding a business to different countries by providing alicense to the individual that is interested in purchasing and operating business. This strategicoption is commonly used in the hospitality industry and has proved to be very successful. HiltonHotel has used this strategy for the purpose of growing their organisation(Lopes,2016).Franchise has helped this organisation to set up business in more countries. There are about 70%rooms of Hilton Hotel that have been franchised to operators and companies. This allows hotelsto have the freedom of running operations and they do not have to provide payments formaintenance and other overhead costs. Hilton Hotel has strict rules and policies when theyprovides licenses to other businesses(Sehitoglu, Ross and Köseoglu, 2017). There are regularinspections done to ensure that franchisee are properly performing business operations.
Franchises help in increasing the country's economic scale as well as Hilton Hotel's brand name.Systematic research on market is done before handing over their company's operations. Theyanalyse competition and certain strategies that can be used to overcome it(Bertozzi, Ali and Gul,2017). Overall, franchising has been effective for Hilton Hotel and they regularly adopt thisstrategic option for their business.There are some other famous strategic options that can be used by Hilton Hotel, if theyfeel like their current strategies are not helping them in a success manner. These include thefollowing:Management ContractsThese are arrangements done by certain organisations within the hospitality industry, inwhich managers are given the responsibility to manage daily operations and are provided withcompensation. These contracts are made for the purpose of running business in different parts ofthe world, without having to manage all properties independently(Sun and Lee, 2018). Ownerscannot look after many hotels that they have established and they require a person that has theskills and competence to efficiently operate business activities. This strategic option can be aneffective one, if Hilton Hotel prefers to choose it, as the main management will be able to divideoperations and focus on how they can all work together, so that profits are maximised(Claveria,Monte and Torra, 2015). However, these managers can leave their jobs without any notice andthis can cause many issues for the organisation.Joint VenturesJoint venture is another strategic option which includes investments of 2 companies thatcome together and perform operational activities. This means that they share ownership, lossesand profits that arise within the organisation. They have to mutually makes decisions that canaffect the organisation. There are however, many risks present in joint ventures as conflicts canarise leading to may disputes between the owners(Falk, 2016). Hilton Hotel can opt for thisstrategic option, of they feel that it can help them in gaining success. With investments fromvarious owners, they will be able to grow and expand in an efficient manner. This is onlysuitable for those organisations that have low funds and require more people to participate in thebusiness(Sehitoglu, Ross and Köseoglu, 2017). When and if Hilton Hotel feels that theyshortage of financial resources, they can choose this strategic option.Mergers and Acquisitions
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