Strategies in International Hotels

Running head: STRATEGIES IN INTERNATIONAL HOTELS
Strategies in International Hotels
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STRATEGIES IN INTERNATIONAL HOTELS
Introduction:
The international hotel companies are coming under market influences more strongly in
the recent years compared to the past which are having strong impact on their strategies as well.
The factors responsible for these market influences and the resultant changes in the strategies are
extremely complex. They consist of factors like increasing numbers of multicultural customers
and the need to integrate the international strategies with local market conditions of each host
market. The paper would compare and contrast between the strategic approaches two Asian
multinational hotel groups namely, the Shangri-La Hotels and the Banyan Tree Holdings adopt.
It would analyse the differences between the strategies the two hotel groups adopted and the role
these strategies played in their success. The next step would be formation of overall strategy for
setting up a new property of Shangri-La in the city of Birmingham, the United Kingdom.
Analysis:
The Shangri-La Hotels and Resorts is a based on Hong Kong and listed on several top
Asian stock exchanges like the Hong Kong Stock Exchange and Singapore Exchange. The main
market of Shangri-La are Asia, Europe, Middle East, North America and Australia. The
strategies of the hotel group is extremely dynamic and customer centric. The Banyan Tree
Holdings Limited is based in Singapore listed on the Singapore Exchange. There exist several
marked differences between the business strategies of these two hotel groups which have
attributed to their success in their respective markets (Sambhanthan and Good 2016).
The first point of difference between the Shangri-La and the Banyan Tree lies in their
leadership style. The management of Shangri-La is more adaptable to the changes in the market
and ready to adapt participative leadership style to adapt to the changes. The international group

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STRATEGIES IN INTERNATIONAL HOTELS
has shown a tremendous success in adapting to the cultural behaviours prevailing in each of its
host markets like the UK and its home market, Hong Kong (Thomas and Devi 2017). The apex
management encourage the employees to participate in the decision making to serve customers
better. The group in order to enforce the leadership style more effectively arranged for trainings
to improve the decision making capabilities of the employees.
The Banyan Tree Group, on the other hand advocated authoritative leadership style while
functioning the markets. The managers expected their subordinates to follow orders and did not
welcome questions and clarifications. The management of the Banyan Tree Group in comparison
to the Shangri-La did not take any initiative to train the employees to sharpen their decision
making skills (Ruffolo 2015). The outcome of this difference in leadership style of the two hotel
groups would form the ground for the next difference, employee decision making capability and
cultural intelligence.
The Shangri-La Group of Hotels emphasised on increasing the decision making
capabilities of its staffs even in the lower levels which contributed towards development of high
level of cultural intelligence among employees. The managers in the hotel group even
empowered the low level staffs to waive around HK$ 100 on request of customers without taking
the managers’ permission. The staff of the hotel were trained to exhibit the cultural behaviours of
the countries where they were deployed. The employees of the properties in Thailand were
trained to greet guests after the Thai customs while the staffs deployed in the Chinese branches
were trained to exhibit Chinese traditional attributes while welcoming customers (Law et al.
2015). The employees were trained to take decisions which would enable them to meet the
requirements of the customers promptly. The Banyan Tree Holdings Limited on the contrary did
not encourage employees to take decisions. The managers directed the employees according to