PSBM115CL Strategic Management: AMARA Hotels Business Strategy Report

This report provides a comprehensive analysis of AMARA Hotels' business strategy, focusing on its performance within the Singapore hospitality industry. The report begins with an executive summary highlighting the company's strengths, weaknesses, opportunities, and threats (SWOT), as well as its strategic direction. It delves into the internal environment using SWOT analysis, identifying the company's quality and luxury services as strengths, and its brand recognition as a weakness. The external environment is assessed using PESTLE analysis, considering political, economic, social, technological, legal, and environmental factors. The report then examines AMARA's strategic position, evaluating its key performance indicators (KPIs) such as revenue and customer satisfaction. The analysis includes a discussion of the company's strategic direction, including its focus on luxury business, quality services, and staff management. Strategies such as digital marketing and product differentiation are evaluated. The report concludes with recommendations, suggesting data-driven marketing and skill development initiatives to address sustainability challenges. It provides a detailed overview of AMARA Hotels' position in the competitive Singaporean market.

Business Strategy: AMARA Hotels
BUSINESS STRATEGY
(MANAGEMENT)

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Executive Summary
Hospitality industry in Singapore is developing at much faster rate however it is facing
different kinds of challenges. This report analyses the internal and external environment of
AMARA hotels. It was found in this analysis that the strength of the company lies in its
quality and luxury services that they provide at competitive pricing. It also has weaknesses
like lesser big brand name when compared to their rivals. They have opportunities outside
Asian in the countries like Australia while the threat is of global economic downfall.
Political, social, technological and legal environment is positive for the business but
environment and economy related concerns could be a problem for the company. The
strategic directions that this company has chosen for its future are Luxury business, Quality
services, Pricing and Staff management. Accommodation and bar & pool services comes in
the star product while Food & Beverages and Meeting & events are cash cow product. In this
report there is also illustration about the strategies made by the company and its evaluation on
the basis of SAF framework. In this regards some of the strategies that is used by the
company are Digital Marketing strategies, Product differentiation and Duetto’s open-pricing
application. A recommendation in the report suggests that company needs to adopt data
driven automated marketing and Skill development initiatives that can help the company in
managing their sustainability related challenges.
Content

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s
INTRODUCTION.................................................................................................................................2
Environment faced by the company......................................................................................................3
Strategic position in the industry...........................................................................................................5
AMARA’s strategic direction................................................................................................................6
Critical evaluation of the strategy of AMARA hotels..........................................................................10
Recommendation.................................................................................................................................12
Conclusion...........................................................................................................................................12
References...........................................................................................................................................14

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INTRODUCTION
Strategic management in today’s time has become one of the greatest assets using which
companies can ensure their sustainability in the long run. There are larger numbers of firms
that are crossing borders so as to ensure that they will have bigger resource source. The
strategies that needs to be designed by the company on the basis of the resources they have
and the demands in the market. Analysing the strategic direction of the company is critical for
understanding that what specific changes they need to do in their firm so as to achieve the
benefits of the opportunities available in the market (Uyar and Bilgin, 2011). Performance
analysis by the company needs to be done with the help of KPIs. It is also essential for the
management to do suitability, acceptability and feasibility on the strategies made by them.
AMARA hotels are one of the best performing hotels in Singapore. It is a part of the Amara
Holding Limited. Apart from Singapore, they have their operations in China and Thailand.
This company is dedicated towards providing one of the best options for relaxing and
provides luxury facilities in which their approach is provide luxury hospitality. Their strategy
is to provide a fulfilling experience and meaningful moments that is cherished throughout
their lifetime. Their strategy remains to make their business in such a manner that they are
able to make better operations than their rivals. Their strategy remains to have three distinct
concepts where each property is grounded in a sense of place. They offer intimate and unique
settings for their clients to explore, unwind or do their business. They have designed their
strategies in such a manner that they are developing properties so as to improve the luxury
facility at the workplace. The financial situation of the company is very good. Alone the
Hotel of the Amara group contributed to the 79% of the total Group’s FY2018 revenue which
is around S$82.7 million which is higher than financial performance of the last year by
around 21% when it was S$68.3 million (Amara Holding Limited, 2018). General state of
industry suggests that Singapore is attracting larger amount of finances as Singapore is
developing itself as one of the biggest tourist destinations in the South East Asia. It is
showing a growth. The major competitors of the company includes Accor International,
Ascott International, Capella hotels & Resorts, Choice hotels international, Fairmont Raffles
Hotels International etc.
In this report there is illustration of the internal and external environment of the Amara
Hotels. Strategic position of the organisation on the basis of KPI has been provided. It also

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suggests that the strategic direction of this company. In the later section of the report,
suitability, acceptability and feasibility analysis of their strategies has been done.
Environment faced by the company
For understanding the internal environment, utilising SWOT analysis can be very much
essential.
Strength
 The strength of the company is the quality that they are providing in their products
and services.
 Its strength also lies in the luxury services that they are providing which is better than
most of the Hotels.
 Strong financial performance within Singapore has given the company huge financial
base in the country (Amara Holding Limited, 2019).
Weaknesses
 They are not a very big brand name when compared with their international rivals
such as Fairmont Raffles Hotels International.
 They do not have large numbers of units in Singapore and outside (Falk, 2016).
 They do not have the tag of the 5 star hotels which is critical for improving the firm’s
position in the market.
Opportunities
 They also have opportunities outside Asian region along with the developing nations
such as India. In the countries like Australia they have the opportunity to expand their
business for higher revenue sales.
 They also have opportunities of making the strategic partnerships with the firms all
across the globe and with the help of partners from all across the globe they can easily
be able to make the opportunities fulfilled (Ashrafi, et al. 2013).
 They also have opportunities to expand in the five-star market where they will be able
to attract people that love higher quality products and services.
Threats

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 Threats are getting bigger in the market in terms of the fact that global tourism market
is facing challenges from the economic slowdown.
 Threats are also increasing in terms of the fact that competition within the industry is
very high and with lots of investments in the Singapore, this threat is going on further
higher side.
 The sustainability related issues are getting bigger and bigger every day. This is
because there is resource scarcity and in this environment it is critical for the
management to make sure that they have a resource plan that can enhance the
company’s performance (Melissen, 2013).
In order to understand the external environment, the use of PESTLE analysis can be highly
beneficial.
 Political: The political environment in Singapore is better where the government is
promoting new kinds of investments. This is done by the company with the help of
reduction in the taxes and also by easing the corporate challenges such as
infrastructure development initiatives. There is a stable political environment within
Singapore that is providing support to the Hotels that aims to add more numbers of
units for their performance (Hertzfeld, 2018).
 Economic: The economic environment of Singapore is excellent however in the last
two years due to international economic slowdown there had been decrease in the
performance of the economic environment of Singapore as well. This will have
impact on the investments within the country and investors will to make further
investments. It is one of the tax heavens in the south Asian regions which make it
easier for the companies to make easier investments.
 Social: Society of Singapore is changing and this change is promoting people to go
out for the luxury services. But it is also the fact that global community is restricting
its expenditures seeking the challenges in the global economy which is playing
negative role in the growth in the market. There is also a constant increase in the
unemployment in the Asian region and this is having impact on the numbers of
potential customers as it is going to lower down the social expenditure capacity of the
people.
 Technology: Since Singapore government has made plans for enhancing the network
infrastructure within the country hence hotel AMARA also needs to ensure that they
are ready for capitalising on the technology opportunities available within the nation

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(Verma, Stock and McCarthy, 2012). This company also needs to do investments in
the IoT infrastructure that will be able to meet the plans of the government in this
regards. The use of data based strategic management approach is critical for Amara as
it will allow the company to have an understanding about the demands in the market
and will help in reducing the challenges faced by the company in its operations
management approach.
 Legal: Government has made the legalisation for business easier and by complying
with all these laws, AMARA can reduce the risk of legal charges. However customer
experience related laws have also been made strict hence the company will have to
follow it so as to avoid any kind of legal compliances.
 Environment: Natural resource scarcity is increasing and in this regards it has become
critical for the management to ensure that they are utilising the environment related
concerns in an appropriate manner and take use of resources such as water in a
sustainable manner.
Strategic position in the industry
AMARA restaurants are performing well in the industry but at the same time there is tough
competition within the industry. This type of competition is calling for analysing the strategic
position of the company in the industry. There has been high performing organisation that has
been able to manage the operations at the optimum levels. They have positioned themselves
as a hotel that is providing high quality services to the customers (Chung and Parker, 2010).
This company is the second best in the industry when it comes to the management of
operations. This company has developed the strategic position for itself in terms of the vision
that this company has made for itself i.e. for new generation of travellers from all across the
globe, they want to provide luxury services that is more than beautiful locations, impeccable
services, seamless connectivity and indulgent experiences. In terms of customer experience
management they are providing their clients with individual tailored experience that inspire
and enrich.
In order to analyse this there must be use of key performance indicators.
Revenue
On the basis of the revenue it can be said that this company has performed well when it
comes to financial performance. Amara has generated revenue of S$82.7 million (Amara

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Holding Limited, 2019). This is higher than most of their rivals especially when it comes to
luxury segment. For instance Capella hotels & Resorts have generated a revenue of $4.9
million.
Customer Satisfaction
In terms of customer satisfaction also this company has performed appropriately. They have
been able to beat most of their competitors such as Accor International and Fairmont Raffles
Hotels International (Pirani and Arafat, 2014).
Market Penetration index
This hotel also has performed well when it comes to the market penetration index however it
has been slow when compared with its competitors such as Capella hotels & Resorts, Choice
hotels international and Ascott Internationals (Lee, 2012).
AMARA’s strategic direction
This hotel has been performing well in the industry which is reflected by the Key
performance indicators. This has been possible due to the strategies that are used by the firms
so as to enhance the overall efficiency of the organisation and gain competitive advantage
over the rivals.
Luxury business
In order to achieve this strategic direction by the company, Amara is applying the product
development strategy. They have been continuously upgrading their infrastructure and
innovating their products and services so as to ensure that they are moving towards luxury
business. In order to pursue this strategy, AMARA is purchasing their products from all the
parts of the world and they are using international standard processes so as to ensure that
customer satisfaction is on the higher side (Poldrugovac, Tekavcic and Jankovic, 2016).
Quality services
AMARA’S management understands the only way to succeed in the existing competition is
by enhancing the quality of services they are providing. In this regards critical role is played
by the quality tools they are using such as lean management (Sigala, Christou and Gretzel,
2012).

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Pricing
In the luxury segment also they are using the competitive pricing strategy. Following this
strategy the company has been able to face the challenges due to competition. In order to
pursue with this strategy, the company has taken all the cost cut measures that are not in the
major operations and most of them are done on the back-end (Bhati, et al 2013).
Staff management
In order to gain staff management in an appropriate manner, company needs to boost the
skills that are present in the internal employees. Staff management has to be done according
to the HR planning by the company.
Following the strategic direction the strategies that have been made by the company are as
follows:
 Market development: They are adding large numbers of services and products to their
major product segment which ensures that they will be able to develop the market in
an appropriate manner. They are also developing their market on the basis of the
quality of the services they are providing. The resort services have been used by the
company to ensure that they have a plan for international travellers that are coming to
the Singapore (Xuchao, Priyadarsini and Eang, 2010). Market development has also
been done by the company by doing marketing. This marketing is done by the
company in the similar manner so as to ensure that they are able to capture the new
markets at a faster speed. Till now this strategy by the company has been effectively
utilised by the company in the nations like Thailand and China.
 Diversification: They have large numbers of products and services available with
them and they are also diversifying their services in terms of prices that they are
offering and the luxury standards they are providing. Following this strategy company
has also added new types of services such as pool and other luxury services like Spa
in their overall hotel packages. Each of their packages has different segments.
 Market Penetration: They will be able to penetrate into different markets with the help
of the quality services they are providing and the type of services being provided by
the company. Utilising these services they have been able to make sure that they are
doing market penetration at a much faster rate. Penetrating market is not an easy job
especially in the modern day competitive environment and due to this they are adding

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resource capabilities to their resource base that helps them in ensuring that market
penetration is done at higher speed (Hargreaves, 2015).
 Product development: They have invested a lot of their money on the aspects like
innovation and research. In order to ensure that product development is as per the
demand of the market, this company is working on the skill development of their
workforce. This has allowed the company to gain their competitive advantage over
the rivals. In different countries they are using different product development strategy
and it is done on the basis of the culture that is present in that country.
In order to understand the product standard for the company, it is critical for the management
to analyse that which product of the company is achieving higher growth in the market and
the products that has higher market share.
 Accommodation: The accommodation of the company comes as a star product that
has helped the company in achieving the higher market growth but it has not enabled
the company to have higher relative market share.
 Meeting & events: This hotel also provides meeting and events services. This comes
in the low growth and higher relative market share and is considered as the cash cow.
Their competitors have better been able to achieve through this service (Altarawmneh
and Al-Kilani, 2010).
 Gym, pool & spa: This hotel also provides additional services such as Gym, pool &
spa. These services add value to the other main services of the company especially
when it is added in the package with other products. This service comes in the star
section as it is able to achieve higher growth rate and higher relative market share.
 Food & Beverages: It is critical for the management of the AMARA to understand
that food and beverages market is getting bigger and in the hotel industry this food
and beverage services adds a value to the overall business. This needs to be of higher
quality. In this company this service of the firm is placed at the cash cow level where
there is need of improvement so that it can reach to higher levels in the market growth
segment.

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High
Market
Growth
Low
Low
High
Relative market share
Critical evaluation of the strategy of AMARA hotels
There are different types of challenges faced by the AMARA hotels in Singapore and due to
this they have been able to gain competitive advantage over the rivals. Some of the strategies
used by the company as the evaluation of the strategies on the basis of its suitability,
acceptability and feasibility are as follows:
 Digital Marketing strategies: This company understands the fact that marketing is a
critical aspect based on which a company like AMARA will be able to make sure that
they are able to have a better understanding about the market and also ensure that
Question Mark
Accommodation
Star
Gym, pool & spa
Dogs
Meeting & events
Cash cow
Food & Beverages

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company will not fail in the market. In this also the company is focusing towards the
skill development initiatives and also utilisation of digital media resources. The use of
social media and other technologies will help the firm to gain competitive advantage
over the rivals. In terms of feasibility analysis it can be said that it is feasible for the
company to have apply digital marketing strategies (Sun, 2011). This is feasible as the
customer segment of this company is highly attached with the technology and they
will be able to implement the technology in an appropriate manner. It is also suitable
as the nature of the market is changing and people chose these luxury services on the
basis of the pictures and videos they see on the platforms such as social media which
allow them to select best products as per their demand. Since the cost of digital
marketing is on the lower side hence it is easier for the companies to persuade their
stakeholders. It also has capacity to give higher return on investments hence it will be
acceptable to everyone.
 Product differentiation: They are gaining competitive advantage over the rivals on the
basis of the type of products they are launching in the market and the difference it has
from the products of the other hotels. They are also differentiating themselves on the
basis of the quality they are serving to their clients or customers and the luxury that
they provide to the international tourists. Adding cultural aspect to their packages
allows the company to be more successful in the market. It is suitable strategy as in
the competition that is present in the industry the way an organisation differentiates
themselves from others plays a critical role in their success. It will allow the company
to gain better strategic opportunity in the market. It is also feasible strategy because
the cost of adding the products or services in the available products or services will
not be much costly however this company has enough financial resources to fund
their innovation and purchase (Mirza, 2011). This strategy is also acceptable to the
stakeholders because it will help the company in gaining higher sales and at the same
time it will ensure that they remain ahead of their rivals.
 Duetto’s open-pricing application: This Company has utilised higher amount of
technologies in different operational areas such as intelligent reporting, cloud based
solutions to the decision making and strategic planning process. This is also a suitable
strategy as in today’s time a company needs to have data driver approach towards
operations management. This is because it allows the companies to ensure that they
do not lose their market share due to any fault from the side of the employees. It is
also feasible because the strategic partnership with the Duetto will allow them to

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manage and maintain the technology. It is also acceptable because it will ensure that
company do not make vague decisions that might create challenges for them. Since
the employees of the company are also highly trained hence they will not face
challenges in adopting this technology.
Recommendation
In the time of the competition that is going on in the market and the change in the business
environment has promoted the firm to understand the challenges that they might face in the
skill development and they might also face challenges related to the finding skilled
employees. In this regards recommendation that can be given to the firm are:
 Data driven automated marketing: It is critical that company understands the thin line
of ethics and ensure that they use data driven approach towards their marketing. This
can also be understood in terms of the fact that data driven automated system will
allow the company to target their customers personally. This is necessary for gaining
competitive advantage over the rivals. This technology is also effective in finding the
challenges in the market and at the same time removing the constraints created by the
human errors. Stakeholders will also approve this technology as it brings efficiency in
the work process (Penner, Adams and Rutes, 2013).
 Skill development initiatives: Since labour related problems will also be going to
haunt the company in the future hence it will be essential for the company to develop
strategic human resource plan for their future. It was necessary for the company to
make sure that they have a plan for enhancing the skills of the individuals. In this
regards international training module needs to follow and employees needs to have
diverse skills which will allow managers to make sure that they do not face challenges
such as labour shortage (Penner, Adams and Rutes, 2013). This will also be
acceptable by all the stakeholders as it will improve the chances of the company to
improve their overall strategies made by the company due to the skilled and multi-
talented employees they have.
Conclusion
From the above based report it can be concluded that AMARA hotels and resorts provides
one of the best services in the Singapore market but the competition that is faced by the
AMARA hotels. Strength of the company includes quality and luxury services that they

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provide to their customers. Their weakness lies in the lesser big brand name when compared
with their rivals. They have opportunities outside Asian market and they are facing threats
like economic crumbled within the world market. The external environment is also not so
good in today’s time however it will provide opportunities to the company. Luxury business,
Quality services, Pricing and Staff management are the strategic direction where the hotel
AMARA will be moving. In this also they are making strategies such as digital Marketing
strategies, Product differentiation and Duetto’s open-pricing application which also qualifies
SAF criteria.

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