Unit 41 - Hospitality Business Strategy

Hospitality
Business
Strategy

Contents
INTRODUCTION...........................................................................................................................................3
TASK 1..........................................................................................................................................................3
P1: Macro-environment analysis.............................................................................................................3
TASK 2..........................................................................................................................................................5
P2: Internal Environment Analysis...........................................................................................................5
TASK 3..........................................................................................................................................................7
P3: Porter’s five forces model..................................................................................................................7
TASK 4..........................................................................................................................................................8
P4: Application of a range of theories, concepts and models..................................................................8
CONCLUSION.............................................................................................................................................10
REFERENCES..............................................................................................................................................11

INTRODUCTION
Hospitality is a service which is provided when a relation is created between a guest and
the service provider (Andringa, Poulston and Pernecky, 2016). Business strategy refers to
various competitive moves or actions which a business takes in order to acquire competitive
advantage in the future time period. These services are in a high demand because of the facilities
they provide to the customers and clients. For this project, Four Seasons Hotels & Resorts chain
is chosen which has hotels all over the world in many countries. It is a global chain providing
luxury services to its varied customers as well as clients. In this report, specific analysis will be
made on analysis of impact of macro-environment, assessment of internal environment of an
organization, evaluation of Porter’s five forces. Also, focus will be made on application of
models, theories and concepts in the context of strategic planning of a hospitality organization.
TASK 1
P1: Macro-environment analysis
Macro-environment refers to various types of external factors which can influence the
business of any organization (Barnes, Meyer and Kinard, 2016). Therefore, it becomes very
important for a firm. The analysis of these factors can be done through PESTEL analysis.
PESTEL analysis in the context of Four Seasons Hotels & Resorts is as follows-
Political factors- These are corruption, foreign trade policy and labor law. They have to
be considered from the point of view of Four Seasons Hotels & Resorts because they can
influence the profitability level of any firm.
 Positive impact- If the country where Four Seasons Hotels & Resorts is operating
business in is politically stable then it will lead towards increase in the revenues and will
therefore allow the organization to target higher profits in the future time period.
 Negative impact- If the tax policy is changed by the government then this can result in
increase in the overall expenses of the organization. Therefore, this will result in decrease
in the profits.
Economic factors- These are exchange rates, interest rates and inflation rates. They are
important from the point of view of organizations because by considering them they can make
sure that they deal with them without facing any kind of issues and problems. Thus Four Seasons
Hotels & Resorts chain is required to consider them.
 Positive impact- If the exchange rates are relatively stable in the country where Four
Seasons Hotel is operating in then this will positively boost up its business. Thus its
profits level can increase.

 Negative impact- If the inflation rate keeps on increasing in the economy then this will
result in decrease in footfall of customers and clients at the hotel and therefore its
revenues will decrease leading to a decrease in profits.
Social factors- These are safety emphasis, health consciousness and lifestyle attitudes
(Buhalis and Leung, 2018). They impact the business of hospitality organizations and
therefore the business of Four Seasons Hotels & Resorts also is affected due to their
influence.
 Positive impact- Due to change in lifestyle attitudes of the customers they now prefer to
spend extra money for staying in five-star hotels. This results in the boost-up of the
business of Four Seasons Hotels & Resorts.
 Negative impact- Due to cultural barriers there are many places where the business of
Four Seasons Hotels & Resorts is affected. This can reduce the overall profits of the
hotel.
Technological factors- These are R&D activity, technological change and technological
awareness (Erickson and Rothberg, 2017). They can impact the business of Four Seasons
Hotels & Resorts because the technological changes can take place very rapidly in a
dynamic business environment.
 Positive impact- Boost-Up to R&D activity can result in increase in the business of the
hotel as it will result in incorporation of certain changes which are required. In the
context of Four Seasons Hotels & Resorts this is necessary because this will help in
increasing the profits.
 Negative impact- If technological change is adopted slowly by the hotel then this will
result in creation of a negative impact on the profitability level.
Environmental factors- These are environmental policies, climate change and pressure
from NGOs. They can create an impact on the business of Four Seasons Hotels & Resorts
because people are now increasingly becoming eco-friendly and are now making the
same expectations from the businesses as well.
 Positive impact- If the environmental policies of the government are in company’s favor
then it will create a positive impact on the business of Four Seasons Hotels & Resorts
because in this way it can create a right impression on the mind of people.
 Negative impact- If the environmental policies of the government are not in company’s
favor then this will result in creation of a negative impact on the overall business of Four
Seasons Hotels & Resorts as the people will think that the chain is not in favor of eco-
friendly policies.
Legal factors- These are discrimination laws, employment laws and consumer protection
laws. They can create an impact on the profits of Four Seasons Hotels & Resorts because
laws, rules & regulations are required to be followed by the business enterprises.