Marriott's Strategic Response to Brexit: An Organizational Analysis

This report examines the impact of Brexit on Marriott International, a major international hotel chain. It begins with an introduction to the company and then analyzes its organizational structure, highlighting how it helps the company function effectively during the Brexit period. The report suggests co...Read More

Management and
Organisations

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
Briefly introduce the organisation...............................................................................................1
TASK 2............................................................................................................................................2
Organisational structure and analyse how this can help the company function effectively in the
wake of Brexit..............................................................................................................................2
TASK 3............................................................................................................................................3
Suggest one modern management approach that could help the company, with Brexit
imminent......................................................................................................................................3
TASK 4............................................................................................................................................4
Industry analysis of the company and identify one current innovative strategic objective of the
company in the wake of Brexit....................................................................................................4
CONCLUSION................................................................................................................................5
REFERENCES................................................................................................................................6

INTRODUCTION
Brexit is the referendum proposed by UK in order to exit European Union. Thus, after the
EU referendum, there has been drastic impact on the economy of UK along with the companies
operating in the respective country. This report will discuss about Marriott International
company and the impact of Brexit on respective organisation. Addition to this, the report will
also study structure of the respective company and various ways in which the structure helps
Marriott in managing impact of Brexit. There are various external forces which have a powerful
impact on the operations of respective company as well as it assist in determining organisation's
current innovative strategic objectives that assist in the wake of Brexit.
TASK 1
Briefly introduce the organisation
Hotel Marriott, UK is an international hotel chain company. Marriott UK offers variety of
services such as accommodation services, food and beverages, banquet and conference facilities,
etc. The respective company is the largest hotel organisation in the world with nearby 6,700
hotel and resort properties in approx 130 countries. The total number of employees in respective
organisation is approx. 1,77,000 (About Marriott International - Find Your World, 2018).
Addition to this, Marriott International has various subsidiaries such as Le Meridien, Starwood,
Ritz Carlton, etc. which helps in grabbing a big market share in the respective industry. Addition
to this, total revenue of Marriott till September 30, 2018 was near by 20289.12 euro which
reflects an increment of 11.8% with every coming year (Marriott Revenue 2006-2018 | MAR,
2018). The respective hotel chain was founded by J. Willard Marriott and Alice Marriott in
1927. The journey of Marriott company started with A&W root beer stand which gave the idea
to Williard Marriott and his wife to start a business by supplying these food and beverage
services to the customers at fair prices. Thus, the first restaurant which was opened by the
founder was Hot Shoppes restaurants. Since then, Marriott International has been growing and
expanding its range of quality services and hotel properties all across the world.
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TASK 2
Organisational structure and analyse how this can help the company function effectively in the
wake of Brexit
Organisational structure is a system which make blueprint of certain activities directed in
the company for accomplishing goals. Along with this, it also involves roles, rules as well as
responsibility. It also determines how would information flow from level to level in the
enterprise. Marriott has a tall hierarchical pyramid organisational structure, it assists in easy as
well as smooth running of business (Marriott, 2018). Hierarchy organisational structure is
utilised by mainly large scale companies which have complex business activities. On the basis of
these kinds of activities, an organisation can easily manage their working activities smoothly by
retaining major responsibilities by higher authorities. At the time of Brexit, managerial staff of
firm having higher authority to take major decisions to effectively cope up with these situations.
At the time of Brexit, the value of pound falls down rapidly which impact negatively on the
services and products cost. Thus, the rates and amount of Marriott takes heights that impact
negatively on their customers. For each tourists and services user, it is hard to retain with the
amount of these hotels for a long run. Therefore, they look forward for the other options that are
available in the market. Thus, it is the responsibility of the senior authorities as well as other
employees to take appropriate decisions for their business organisation that assist them to sustain
their clients for a long run duration (Stacho, Urbancová and Stachová, 2013). In this case,
business structure and its working practices matters a lot in which, employees gather information
and provide them to senior managers. On the basis of these data, manager and senior employees
takes decision. As per the defined organisational chart, decision making responsibility distributed
to each individual on the basis of their working practices. In Marriott, General Manager of firm
takes responsibility to managing functional approaches of firm in effective manner (About
Marriott International - Find Your World, 2018). On the basis of these structural approaches,
firm operates their business in numerous countries. These operational activities of firm assist
them to contend up with the situation of Brexit in which firm retain their cost on affordable costs
to enhance relationship with their clients easily.
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TASK 3
Suggest one modern management approach that could help the company, with Brexit imminent
Contingency management is a most effective approach that provides flexibility to
organisation for the development of new strategies. Marriott has adopted contingency approach
to create human relationship effectively. Organisation provides tremendous important to their
associates that assist them to build a unique brand image at worldwide (Nudurupati and et. al.,
2016). On the basis of these management approaches, firm can easily adopt new changes for
providing quality services to their customers on the basis of new trends and customer's
requirement. At the time of Brexit, values of large scale organisations were falling down rapidly
due to high rating services as well as cost. Thus, the organisation faces adverse changes in the
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Illustration 1: Marriott Organisational structure
(Sources: Marriott, 2018)

strength of their clients. At this situation, contingency management approach of firm provides
the flexibility to make changes in business services. Hence, the managerial staff of firm takes
decision to manage cost of their business services. On the basis of these changes, firm is getting
desired outcomes by sustaining customers with the firm for a long run. By implementing
contingency approach, management of Marriott provides maximum benefits to their employees
who are the valued member of organisation. These activities assist to make involvement between
employees to make a way for the improvement of business productivity and efficiency (Madera,
2013). Marriott having different kind of strength as their employees, management approaches,
organisational structure, functional approaches and so on that assist them in operating business at
worldwide effectively. In large scale organisations, situational, contingency and system
approaches are required to be implemented properly that enhance values of firm. Marriott take
advantages through these aspects in which they rewarded their employees by the achievement on
the basis of their working skills and abilities. All these things help to build long term relationship
in organisation for sustaining in a economy for a long time of period.
TASK 4
Industry analysis of the company and identify one current innovative strategic objective of the
company in the wake of Brexit
As a result of Brexit, hotel industry has been immensely affected. To deal with this,
Marriott uses sustainable techniques. Also, the company has adopted an innovative
environmental strategic objective named “Spirit to Preserve” through which they aim to attract
more customers in the wake of Brexit (Marriott, 2018). To carry out the industry analysis of
Marriott, Michael Porter’s Five Force Model has been used.
 Threats of New Entrants: New entrants in hotel industry reflect new and innovative
practices which pose threat to Marriott International. To deal with this challenge,
company makes use of its innovative strategic objective through which it reduces the fuel
and also the impacts upon environment which helps them to attract more customers.
 Bargaining Power of Suppliers: Hotels buy raw materials from a number of suppliers
which demand high prices in response to the resources and services delivered to Marriott.
This decreases the profit margin of company (De Grosbois, 2012). But enterprise uses its
green initiative so as to increase its demand in market.
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 Bargaining Power of Buyers: Buyers often have unlimited demands in relation to
lodging. They require and prefer the best services while paying the least cost for it which
puts a pressure on Marriott International and affects their profitability in long run. Thus,
the company largely employs green innovative strategic objective to communicate their
eco-friendly initiatives to society and increase their sales.
 Threats of Substitutes: As the hotel industry is too big, there are various alternatives
available to customers to choose from (Brookes and Roper, 2012). They avail services
from that organisation which provides all the quality services while charging less for the
same. This acts a challenge for Marriott and thus, company by way of its sustainable
objective attract customers towards the premises.
 Rivalry: If the number of competitive businesses in the industry is more, it would
increase the rivalry among hotels reflecting decreased prices for Marriott along with
reduced profitability. To tackle this, company uses its innovative strategic objective so as
to boost its sales and increase customer loyalty.
CONCLUSION
From the above report, it has been summarised that Brexit had a major impact on the
economy of the country. Also, it has been analysed that every international organisational makes
use of management approaches to gain edge over its competitors. Along with this, Porter Five
force model has been used to assess the impact of situations arising in industry upon the
international business entity. Furthermore, it has been assessed that employing Hierarchy
organisational structure in carrying out the operations of large scale organisation helps the entity
in effectively performing its functions along with meeting its objectives in the long run.
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REFERENCES
Books and Journals
Brookes, M. and Roper, A., 2012. Realising plural-form benefits in international hotel
chains. Tourism Management. 33(3). pp.580-591.
De Grosbois, D., 2012. Corporate social responsibility reporting by the global hotel industry:
Commitment, initiatives and performance. International Journal of Hospitality
Management. 31(3). pp.896-905.
Madera, J. M., 2013. Best practices in diversity management in customer service organizations:
an investigation of top companies cited by Diversity Inc. Cornell Hospitality
Quarterly. 54(2). pp.124-135.
Nudurupati, S. S. and et. al., 2016. Eight challenges of servitisation for the configuration,
measurement and management of organisations. Journal of Service Theory and
Practice. 26(6). pp.745-763.
Stacho, Z., Urbancová, H. and Stachová, K., 2013. Organisational arrangement of human
resources management in organisations operating in Slovakia and Czech Republic. Acta
Universitatis Agriculturae et Silviculturae Mendelianae Brunensis. 61(7). pp.2787-
2799.
Online
About Marriott International - Find Your World. 2018. [Online]. Available through:
<https://www.marriott.com/marriott/aboutmarriott.mi>.
Marriott Revenue 2006-2018 | MAR. 2018. [Online]. Available through:
<https://www.macrotrends.net/stocks/charts/MAR/marriott/revenue>.
Marriott. 2018. [Online]. Available through: <https://www.slideshare.net/smillingjin/marriott-
13049320>.
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