TM4010: Business Environment in Events, Hospitality, Tourism Report

This report provides a detailed analysis of the business environment within the hospitality, events, and tourism sectors. It begins by defining the business environment and its impact on organizations, particularly focusing on how businesses adapt to external and internal factors. The report aims to enhance understanding of business environments, including micro and macro factors, using PESTLE and SWOT analyses to assess the business environment of Intercontinental Hotels Group (IHG). It also examines Porter's generic strategies for achieving a competitive advantage, the importance of business ethics, and leadership styles. The report concludes with recommendations and a summary related to competitive advantages and potential future challenges within the hospitality industry. The analysis includes the application of various analytical frameworks and concepts such as PESTLE and SWOT, to understand and evaluate the external and internal factors affecting IHG, along with discussions on business ethics, leadership styles and competitive strategies. The report also addresses the challenges and opportunities within the sector.

TM4010 Business
Environment in Events,
Hospitality and Tourism

Contents
PART 1............................................................................................................................................3
PART 2............................................................................................................................................4
Analytical framework and concepts.............................................................................................4
PART 3............................................................................................................................................9
REFERENCES..............................................................................................................................11

PART 1
Business environment includes all factors that have an impact, namely workers, buyers,
administration, market prices and market regulators, that influence how the company operates.
An illustration of an aspect of a corporate environment here is how the needs of the customers
are fulfilled. The hospitality industry mainly based on the business environment that consist of
external as well as internal factors that influence on the business in direct manner. The industry
faces many environmental issues that related with the operation of organisation and for this apply
different strategies. To predict the business environment in hospitality industry, organisations
apply various methods and accordingly apply changes in their business (Denizci Guillet and
et.al, 2019). The aim of the report to understand the environment of business and how operates in
different situations. The other aim of the report increase knowledge of learner in regard of
business environment in hospitality & events and evaluate the concept of micro and macro
environment. Micro environment includes those factors containing all the participants of the
actual environment of the company that affects the operational productivity, because they have a
basic impact on the daily business organisation. The macro environment in relation to how its
output is affected by the macroeconomic conditions under which a business or industry works. In
comparison specific sectors in the economy, branch of economics that deals with aggregate
output, consumption, and the level of prices in a society.
The main objective of the business conducts PESTLE and SWOT analysis to understand
the business environment for selected business. Along with discuss about the porters generic
strategies that helps to attain competitive advantage in effective manner. Moreover consist of
importance of business ethics and ethical consideration in which include corporate social
responsibility. Identify leadership style that follows by selected organisation and actions taken by
business to become ethical internally and externally (Estiri and et.al, 2018). At the end provide
recommendations and summarise about the findings which are related with the competitive
advantage and how overcome from the future difficulties. To better understand of the report
selected hospitality industry. In particular, the hospitality industry is regarded as a portion of the
larger service sector, with an emphasis on recreation instead of more specific needs. In this
paper, they will know much more about essence of the hospitality sector, the various industries
inside it, and its ties to the hotel and travel industries. It is possible to describe and understand

the restaurant business as an industry that provides lodging facilities, food and all support
products for the convenience and recreation of travellers and tourists. Hospitality is the sector
that includes all the goods and services which support passengers, visitors and guests of all
kinds.
The history of the hospitality sector has always been related to various cultures and
traditions in some way or another, or it has been part of culture. The Greeks, for instance, was
the first one to establish historical sites in villagers to include a spot for the farmers to rest and
recover whenever needed. The Roman Empire were the first to construct luxury homes in order
to provide lodging for visitors who were on official service (Harjanti, 2019). Caravanserais were
established in the Middle East that provides refuge and a place of rest for caravans on Middle
Eastern roads. Some christian churches also founded inns, hospices and facilities to cater to those
who travelled mostly during Middle Ages whenever the abbeys and churches will become the
first institutions to offer shelter to visitors on a routine basis. IHG is one of the nation's top
luxury hotels with a commitment supply everyone with genuine hotel; to make everyone feel
comfortable and cared for, remembered and appreciated, whenever they're in the globe and
anywhere they are. In even more than 100 countries, they license, lease, operate or own almost
5,800 hotels and nearly 865,000 bedrooms, with over 1,900 hotels in their growth pipeline. IHG
also runs our worldwide loyalty scheme, the IHG Rewards Club, which has far more than 100
million monthly active users.
PART 2
Analytical framework and concepts
PESTLE analysis: The PESTEL review offers great information on the organisational
problems facing Intercontinental Hotels Group Plc, apart from competitive pressures, in the
prevailing macro climate. For instance, with a significant growth trend, a sector can be extremely
profitable, and if it is placed in an uncertain political climate, it will not be great for
Intercontinental Hotels Group Plc.
Political: In deciding the variables that can affect the long-term competitiveness of
Intercontinental Hotels Group Plc up in a particular nation or market, political factors play an
important role. In more than a dozen people, Intercontinental Hotels Group Plc operates in

hospitality industry and exposes itself to various forms of political climate and threats to the
political structure. Before entering or investing in a certain market, Intercontinental Hotels Group
Plc should closely examine the following factors:
 Political stability and the significance to the nation's infrastructure of the travel & leisure
market (Haseeb and et.al, 2019).
 Chance of invasion by the government
 Level of corruption-the level of oversight of the information services industry in
particular.
 Bureaucratic system and state interference in the transportation & leisure sector.
 Contract Compliance Legal System
Economical: Intercontinental Hotels Group Plc will use the economic aspect of a nation
including rate of growth, financial trends of unemployment & sector including such pace of
growth of the hospitality industry, consumer spending, etc. to predict the steady growth not only
with the market, but also about the company. Economic concerns that should be considered by
Intercontinental Hotels Group Plc when performing the PESTEL study are-
 The currency value of the country plays an important role will have an influence on
commercial, including if it participates in foreign investment. Also critical is the
competitiveness of the market: an increase in exchange rate prohibits foreign
investments.
 An increased degree of unemployment and poverty might assume that there is a higher
job confidence in the market, which will also mean that people might be able to function
for a reduced salary, which will also reduce the costs of employment.
 Stock markets & host-country currency stability.
 Employee skill standard for the travel & leisure industry (Leung, Wen and Jiang, 2018).
 Standard of qualification inside the society
 In the market, labour costs and efficiency
Social: The atmosphere of culture and the way things should be done have an impact on
the culture of an entity in a setting. Related population values and perceptions play an important
role with how Intercontinental Hotels Group Plc document identifies the powerful the customer
base and also how they business model future for buyers in the hospitality sector. Social

variables that should be analysed for PESTEL analysis by Intercontinental Hotels Group Plc
management are-
 To a certain degree, gaps in the academic context between marketing and the marketing
strategy will make it impossible to adequately connect to and capitalize on the customer
base. They should be really careful not to offend the connexion to the expectations and
preferences of the target group.
 It is important to be completely aware of the implications of health and safety standards,
attitudes to accusations of sexual harassment and the value of sustainable development in
the market world in general, and hence, because they're seen as the normal, they are
required from every other organisation.
Technological: Technology easily disrupts different sectors across the panel. The
automobile project is a great justification for supporting this point. For about the last 5 years , the
market has changed very rapidly, not even giving emerging participants the option to keep up
with the changing scenario. An organisation might not only calculate the creativity of the
enterprise, but it’s the development of the economy for which modern technology is installed
(Lin, Song and Lee, 2020). Low speed will give more time, though this intensity of changes in
technology can grant a business limited resources to compete and be sustainable. Technology
research consists of following factors to be learned:
 How well innovation advancement will help boost / modify what the objective function is
defined presents. Unless this adjustment is substantial, so other corporations in the
organization perform more profoundly.
 The impact of information technology mostly on investments which so many
corporations in the market are related has the ability to dramatically enhance or lower the
associated revenue. Since these income are massive in numbers, they can be allowed to
invest in the R&d team, when possible technological improvements would only further
expand the amount of tax revenue, so on and so forth, securing long-term, sustainable
investments.
Legal: The legal framework and mechanisms are not robust enough to use as a variety of
foreign agencies to protect the property rights of an entity. A business should study before
entering these markets, because that can lead to the stealing of the company's unique
formulation, thus the major industry benefit. Many of the operational parameters that should be

recognized before entering a new market by the managers of Intercontinental Hotels Group Plc
are—
 Upon seeing the miserable conditions that workers were compelled to work in either
during or immediately just after industrialisation, workplace safety regulations were
established. It may be costly to enforce the correct rules, but it must be involved, not just
because of the legislation and also because of the private feeling of ethical and social
obligation to other fellow humans.
 Regulations are often put in place to ensure that such goods just have those standards of
service or fair deal in system to continue the consumer protected and to discourage them
from being delivered. This contributes to businesses which often consider their buying
needs.
Environmental: Several companies have different criteria or environmental legislation
that can impact the efficiency of a company inside these sectors. States, often within an area, also
may have different environmental standards and liability laws (Nikolskaya and et.al, 2020). Until
starting a real business venture in a developed market, IHG hotels should carefully evaluate the
sustainability considerations that are required for success inside these environments. Many of the
ecological factors to be considered in progress by an Intercontinental hotel are-
 The Climate
 Changing the Atmosphere
 Laws governing emissions in the atmosphere
 Travel & Leisure industry controls on air and water emissions
 Reprocessing
SWOT analysis: This is a comprehensive InterContinental Hotels Group Plc SWOT
study. It helps to assess the advantages of the InterContinental Hotels Group and its limitations.
It also aims to address some of the corporation's possibilities and risks.
Strength: A strong recruiting strategy was introduced by IHG, which eliminated the HR
generalist method and reassigned the recruiting role to organization's operational divisions. For
instance, the payroll role was delegated to payroll divisions and hiring at the line level was
transferred over to agencies, removing the needless complications and hiring paperwork (Putra,
and Cho, 2019).

Weakness: Numerous negative customer reports have been drawn from the
organization's loyalty schemes like Holiday Inn Priority Club and IGH Rewards Club. It was
claimed by many clients that the expected figures have not always been given to the clients. If
they tried to recover them, several consumers were informed the points had withdrawn. There is
no end date for reward points!
Opportunity: The new technology gives InterContinental Hotels Group PLC an
opportunity to introduce a competitive pricing strategy in the new environment. It will allow the
company, via other value-oriented proposals, to retain its loyal customers with great service and
bring new clients. The organisation has spent vast amount of money in the internet site over the
past couple of years. For InterContinental Hotels Group PLC, this development has launched a
new distribution channel. The business will take advantage of this opportunity over the next few
months by properly understanding its customers and fulfilling their needs using broad activities.
Threat: There have been several competitors who have joined the industry and are
increasing its market share through taking market share from established businesses. This is a
challenge to Intercontinental Hotels Group Plc, since these new competitors may lose their
interest. Competition in the market has risen, placing pressure on the price (Ruan and Tian,
2019). It might result in a reduction in Intercontinental Hotels Group Plc revenue generated
whether it adapts to price increases or, and if it doesn't, a loss of customers.
From either the research carried out by InterContinental Hotels Group Plc for this swot
study, it is clear that IHG is the lowest troublesome of all the major hospitality organizations
around the world. This is due to its marketing and functional organizational development. In
addition, the leadership of the party appears to be more durable and securely defined in their
roles.
Porter’s generic strategy: The Intercontinental Hotels Group has developed its branding
game as a rising operator with a broad footprint across the world as a means of certain important
components that can provide a significant advantage over other competitors in most global
countries, including certain efficiency. The competitive advantage techniques of Intercontinental
Hotels Group can be interpreted in the light of the aggressive targeting and pricing model of
Michael Porter (Smith, Clement and Pitts, 2018).
Cost leadership: This strategy enables Intercontinental Hotels Group to grow its
customer base by approaching the middle and lower classes that in most cases constitute the

largest proportion of the total customer market mix. For middle-class consumers, the pricing
factor is usually extremely critical, and competitive advantage seems to be the strongest way to
improve the quality of this business segment. The Intercontinental Hotels Group emphasises the
consistency and increasing prevalence of its branded products, leading to massive brand image
and successful intensity of competition, thus getting a valuable competitive advantage centre.
Differentiation strategy: Intercontinental Hotels Group enables the introduction of
differentiation as a secondary generic tactic to broaden the consumer market by stressing the
distinctive characteristics of the product. The strategic goal of Intercontinental Hotels Group's
use of this approach is to distinguish by incorporating creativity and addressing the increasing
health issues of customers. Intercontinental Hotels Group places each product and marketing
strategies that stands out and differs from the various choices via a generic product
differentiation. As a successful business with such a structure makes it easy, the industry makes
distinction as a weapon for other companies to minimise pressure. Only to distinguish the
Intercontinental Hotels Group from several other brands, strong profit is needed in advertising,
ads and corporate sponsor.
Focus strategy: Focus is the main generic competitive technique that allows businesses to focus
their efforts on increasing the markets that are limited in scope. Whenever the focus approach is
implemented by enterprises, they represent unique target consumers and concentrate their
significant advantage on product innovation. Intercontinental Hotels Group follows the focus
approach when it comes to cost cutting and getting the best experience. The low-cost target
method is beneficial whenever protecting the interests of a new competitive environment at the
maximum price possible. Fortunately, by addressing the flavour, complexity and requirements of
the services that could better fulfil customer’s needs and wants; the right approach of investment
concentrate is incorporated (Stylos and et.al, 2018).
PART 3
Importance of business ethics
The ethics of business vary from one industry to another, and country to country. The
essence of the practises of an organisation has a significant impact on the ethical challenges it
must deal with. For instance, for an investment broker, an ethical dilemma occurs when the right
choice for a customer and their cash doesn't really align with what offers the biggest price to the

fund manager. A media business that manufactures children-oriented TV content can feel an
ethical duty to encourage great morals and avoid off-colour material in its broadcasting.
The centre of InterContinental Hotels Group (IHG) group hotel do is corporate social
responsibility (CSR). It's why the IHG management team needs to make sure that CSR
operations are a massive component of those approaches when developing strategies. Each IHG
hotel is dedicated to doing its bit for its surrounding area and its people, from blood donations,
clothing donations to collaborations with important entities and initiatives. The resort and its
staff have made many clothing and blood donations for the good of the people, beginning with
the InterContinental Resort. InterContinental Resort has also secured both the Green Key and the
Blue Flag, which are environmental conservation and safety credentials. The resort is also
enthusiastic regarding annually observing Mother's Day by holding brunch with the some of the
parents that are sponsored and taken care of by Aqaba charity (Sutrisno and Jazilah, 2019).
The value of business ethics goes well beyond the commitment and motivation of the
employees or the intensity of a partnership between management teams. As in all media
campaigns, in both the short and medium haul, the ethical activity of an organisation is clearly
connected to productivity. IHG's executive team sets the tone for how the whole organisation
works on a regular basis. If the dominant theory of leadership is focused on ethical practises and
actions, leaders within about an organisation should direct workers by instance and responsible
for making invaluable contributions not only to them as persons, but also to the organisation as a
whole. Building on an ethical conduct basis helps to establish long-lasting positive effects for a
corporation, such as the retaining and attracting extremely valuable staff, and to develop and
sustain a strong community image (Tews and Stafford, 2020). Starting a company as per the side
view of ethical way that helps to build a strong relationship between people in the executive
team, thereby creating consistency within the business.
Recommendations
 As per the analysis it is recommended that hotel has good business environment and
competitive advantage strategies to attain business objectives. The PESTLE and swot
analysis provide factors that impact on the business and for this apply different strategies
in proper manner. To maintain to leading position requires following porters generic
strategy to achieve all the competitive advantages and run business in ethical manner.

 It is finding that corporate social responsibility fulfils all the requirements and manages
all the activities in proper manner.