Comprehensive Business Strategy Report for Hilton Hotels Corporation

This report provides a comprehensive analysis of Hilton Hotels' business strategy, encompassing various frameworks and models to assess its market position and internal capabilities. The report begins with an examination of the macro environment, including demographic, economic, political...Read More

Hospitality
Business Strategy

Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................2
Impact and Influence of macro environment and changing customer preference..................2
TASK 2............................................................................................................................................4
Internal environment and strategic capabilities analysis........................................................4
TASK 3............................................................................................................................................6
Evaluation of Competitive forces by applying Porters Five Forces Model...........................6
TASK 4............................................................................................................................................7
Strategic management Plan for Hilton Hotel..........................................................................7
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................11

INTRODUCTION
Business strategy can be defined as a collection of decision which helps the business owner
in achieving the goals and objectives of organisation. In simple words it can be saved as a plan of
Management which is made for the purpose of securing a competitive position in the market.
Various businesses have various goals and objectives and it is necessary to make strategies
according to them. Below mentioned report is based on Hilton hotels Corporation which is an
American multinational hospitality company having headquarter in Tyson Corner, Virginia,
United States. It was founded in 1919 and currently they have almost 6215 properties in approx
118 countries. The purpose of making this support is to applying the various frameworks and
their impact of micro environment along with the the identifying internal environment and
capability. In addition to this it also shows the Porter five force model and various theories and
concepts related to the strategic planning in and Hospitality organisation which is Hilton Hotel.
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TASK 1
Impact and Influence of macro environment and changing customer preference
Below-mentioned six factors can be included in the Macro environment:
 Demographic: It includes the physical assigned pop the complete audience. For instance
occupation, age, growth rate, gender, sex, ethnicity and many more. These features of the
audience affect the business strategies.
 Economic: Complete success of business is totally depending on the economic condition
of area. As it is founded that high interest rate and recession take place it leads to the
decrease in purchasing power of customers (Romero, I. and Tejada, P., 2020). They have
less money for spending. Whereas boosting in economy implies uplift in spending power
of consumers.
 Political: Government Agencies also influence the decisions of strategic business of an
organization. They have right to limit the operations of a business.
 Ecological: It involve all the natural resources which give impact on business activity is
and their shortage are cause a great impact on the business operations.
 Socio cultural: It includes various cultural forces of societies and values which give
impact on the decision making power of customers.
 Technology: It plays an important role in an business organization as it introduced
various new methods for completing the business activities.
SWOT Analysis
It can be said as a marketing tool which is used to analyse the internal and external factors
which may help the organization in removing the weaknesses and grabbing the opportunities
available in the market. It helps in analyzing strengths, weaknesses, opportunities and threats.
Below mentioned is the SWOT analysis of Hilton hotels:
Strengths Weakness
 High Brand Identification.
 Approximately 6215 working
properties in almost 118 countries.
 It has good brand image but the market
share is limited (Puškar, J., 2020).
 Services may got differ as the
organization is working globally and
there are various government policies
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of each and every country.
Opportunities Threats
 Revolution in the services to customers.
 High possibilities in appearing in
market.
 Increasing competition day by day in
the hospitality industry.
 Standard growth.
Unexposed markets allows various opportunities which leads to the future growth of
organisation. Issues related to the services a are required to investigate and they should resolved
on time.
PESTEL Analysis
It can also be defined as an another tool of marketing which is used for the purpose of analysing
macro environment factors which include political, economic, social, technological,
environmental and legal factors.
 Political Factors: Hilton Hotel is doing business worldwide. Every country have their
separate political rules and regulations. For the purpose of achieving success they are
required to explore themselves to various types of political environment and political
systems risk. Hilton hotels are following taxation policies, antitrust law related to
lodging, Bureaucracy and interface in lodging industry by government.
 Economic Factors: Inflation, interest rate, economic cycle can be considered as macro
environment factors (Olimovich, D.I., 2020). Hilton worldwide Holdings INC can
consider the economic factor of every country like inflation and growth rate consumer
spending and many more.
 Social Factors: The culture of societies and the ways in which the organization perform
all the activities which influence the culture of organization comes under social factors.
Hilton Hotel is designing the message of Marketing by understanding the all customers of
a specific market (Schuckert, M., 2020). Their social factors can be considered as
demographics and skills level of population, gender, social conventions and many more.
 Technological Factors: As the technology is changing day by day. Hence it is become
necessary for organization to follow the technical factors which leads to the growth of
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organization. Hilton Hotel is accepting rooms booking through online application. Along
with this they had made a Google form for feedback of customers.
Stakeholders Analysis
It can be defined as a process through which various stakeholders are identified. Analysis
of expectation of various stakeholders and place them according to the interest and ability of
stakeholders which can influence the business organization.
Nowadays organization can be considered as open system because they accept the input from
society and create output which gives an effect on society (Ogbeide, G.C., Fu, Y.Y. and Cecil,
A.K., 2020). Hands it can be said that it is an influential factor for all the organizations to be
responsible towards the society along with taking care of all the needs and wants of their
stakeholders. In simple words it can be said that a stakeholder analysis provide a proper
guideline stakeholders group in each and every particular situation.
Hilton Hotel is operating in various cultures all over the world having different values
believe of stakeholders. They have generated power to influence all the stakeholders. They give
priority to their stakeholders in every particular situation. They have ability to influence the
stakeholder.
TASK 2
Internal environment and strategic capabilities analysis
Below mentioned is the explanation of internal environment and strategic capabilities analysis:
Mckinsey 7S Model
For the purpose of analyzing any business scenario for conceiving any strategy according
to the scenario, McKinsey model was formed. Below mentioned is the explanation of 7s of this
model:
 Strategy: Performing a plan of an organization in order to change in environment at
workplace.
 Structure: It can be e shade as it is base of specialization and coordination which that
influence throat strategy, diversity and size of organization (Metaxas, I.N. and
Koulouriotis, D.E., 2019).
 Systems: Those systems which support the strategy and structure of organization. It
includes formal and informal system.
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 Style/Culture: Sharing beliefs, norms and values according to the time.
 Staff: It includes those person who are working in the organization.
 Skills: The typical capabilities of employees.
 Shared Values: Accepting the guiding concepts and fundamental areas.
Hilton Hotel Corporation should analyze their business around 7s model for the purpose of
identifying understanding and controlling the impact of these 7S on the business operations. It is
necessary for organization to make a balance between these seven factors for the successful
running of business (Szende, P., Bagnera, S.M. and Cole, D.C., 2020).
Value Chain Analysis
It is a necessary for every organization to understand the needs and requirements of customer’s
full stop it comes under value chain analysis. Along with this the management also takes care
about the values of customer’s wild explaining a new product in the market. If there is lack of
understanding needs of customer, the newly launched product will feel in the market. This failure
of product can be said as the most common cause of product failure faced by the various
organizations (Mejia, C., 2019). It can be said as the main reason that why the value chain
analysis is important. Its main focus is on identifying the needs and values of customers which
are related to the behavior, social environment and culture. If the organization has launched a
product which is not satisfying the needs and requirements of customer then surely the
organization stuck with this product and waste their time and energy in doing various
modification in the same product. This can be said as the hurdle in the success of project.
Hilton Hotel is required to preview all the processes activity is and do analysis and
questions that the each and every step should contain the values. All the employees and suppliers
becomes a part of this value chain before the product deliver to their customer.
VRIO Framework
It helps in identifying the capability is and various resources owned by the organization
for the purpose of analyzing the main source which provides the advantage of competition to the
organization. This Framework include four features of the resources of organization which make
sure that the organization take the advantage of competition. Value, Rarity, Imitability and non
substitute.
Hilton is required to analyze whether the services they are providing our valuable rare
costly to copy and Organization of business to capture the value. Providing accommodation to
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guest is the main service of the business they are providing should have these features so director
the organization gain long term advantage.
VRIN Framework
It is established for the purpose of gaining the competitive advantage on the services Hilton
Hotel is providing (Jang, S.S. and Park, K., 2019). For the purpose of gaining the advantage of
competition Hilton Hotel is required it to work on the development of four factors which are
required to gain the long term advantage of competition.
Organizations growth strategies capabilities and skills
 Market Penetration: it can be defined as the activity which the organization used for the
purpose of knowing about the market share of their existing services and enhancing about
the new product launch through various strategies (Tsou, H.T., Chen, J.S. and Yu,
Y.W.D., 2019).
 Market development: This activity involving the procedures under which new product or
services has been launched among the existing Markets and customers of organization. It
leads to the increase in product line or service of organization.
 Diversification: It leads to those growth factors under which new product has been
launched in a new market.
TASK 3
Evaluation of Competitive forces by applying Porters Five Forces Model
Competitive forces faced by Hilton Hotel can only be understand by applying the Porter
five forces model of competition. Below is the explanation of a porter's five Force model:
 Competitive Rivalry: It can be defined as the competition faced by any Organization in
the market on the various factors which include number of competitors, quality of
product and services offered by competitors, market share and many more. Hilton hotel
analyze the markets while operating and analyze the competition faced from the market
Rivals (Guizzardi, A., Pons, F.M.E. and Ranieri, E., 2019). It helps retain hotel in
understanding the purchasing habits of customers along with the needs and requirements.
 Bargaining power of vendors: The competition of hospitality industry is high it i seems
that bargaining power of vendors is also high. It is necessary for Hilton hotel to analyze
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the bargaining power of customers which is related to the part of value chain. It also
helps by Hilton hotel to to identify the buying strategy.
 Bargaining power of customers: It can only be analyzed on the basis of VRIO/VRIN
analysis services offered by the organization. Hilton should identify the bargaining power
of customers as the brand loyalty of customer in the market.
 Threat off substitute: It refers to those alternate which are available in the market for the
customer. In simple words it can be said that those alternates which can satisfy the
demand and need of customer. Hilton Hotel should recognize the threat of substitute in
the market in which they are doing business and in the target population. It is useful for
deciding the prices and marketing strategy.
 Threat of new entry: When any new organization comes in the market it will share the
market size which gives a a negative impact on the company. It is totally depend on the
amount of investment required for entering in any market as competitor. Hilton should
evaluate there trade in the market it operates.
TASK 4
Strategic management Plan for Hilton Hotel
Porter also present a matrix which explain the generic strategies on which various
organisations fall on which are as follows:
 Cost Leadership: it means attracting the customer on the basis of a prices offered by the
organization by applying various discounts and promotional schemes. Hospitality sector
include narrow margins along with various factors on which the prices of services are
depend.
 Differentiation: It defines the competition on the basis of different factors which gives
result in the benefit in competition (Fayos-Solà, E. and Cooper, C., 2019). This strategy is
very short and suitable for those market where the customers are brand loyal and they
don't want to switch the brand only because of difference in prices.
 Cost focus: this is strategy is applicable on a small piece of market segment as it is based
on cost. Under this strategy in the target population is very small and it is easy to analyse
the buying pattern and purchasing habit of customers.
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 Differentiation Focus: It refers to the strategy which is based on the differentiation in a
particular market. Under this strategy organisation select the target population and aim
them for such a strategy.
Selection of strategy in a right manner is depend on the loyalty of customers and their buying
behaviour and preferences. Hilton Hotel is doing business operations in international markets
with various patterns and trends. So it is clear that it is depend on market to market. Hilton Hotel
is suggested to adopt a differentiation strategy for their services and cost leadership strategy purv
travelling services.
Ansoff growth matrix
Below mentioned are the various dimensions of growth of revenue which are explained as
below:
 Market Penetration: Under this is strategy the organisation make objective to increase
the the sales of existing product in existing market by using various aggressive marketing
strategies. It is necessary for Hilton hotel to understand the market where they can go for
penetration strategy.
 Market Development: Under this is strategy the company decide to launch the existing
product in a new market. The main objective of this strategy is to establish early entrance
in the new market.
 Product Development: It leads to the introduction of new product in existing market. It
can be explained as providing more choices to the customer.
 Diversification: It's main objective is to spread the risk because under this strategy
organisation launch new product in a new market for the purpose of increasing share of
the market (Dixit, S.K. ed., 2020).
Hilton Hotel is providing Limited services so they are required to make strategies of product
development so that they can offer various services to their customers. They also have an option
of working on the development of New Market so that they can easily get entrance benefit.
Proposed plan for business
Tangible and Tactical Priorities: for the purpose of achieving the mission of organization they
provide metrics against which the management of organization measure the actual performance
for analyzing the weather the organization in moving toward the achievements of its strategic
goals, can be defined under only strategic objectives. It is necessary for organization to make
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their objectives SMART (Specific, measurable, achievable, realistic and time bound). The
success of strategy is totally depend on the formation. Hilton can achieve their objectives by
entering in the specific market and launching healthy products prices product and competitive
basis.
 Strategic Objectives: As currently Hilton Hotel is falling short of growth targets and they
are facing deep in the value of their slightly + food hygiene consciousness customers not
willing to buy products with health issues. Hilton hotel has Limited services hence they
are required to do the development of product.
Because of covid-19 customers are becoming more conscious regarding their health so Hilton
Hotel can do investment in launching the the healthy services and which include healthy food
items with less calories. Hilton Hotel is aiming to do the improvement in their growth as well as
revenue in the market (Bavik, A., 2020). They can also do the sales of their services at very low
value products at low prices. As launching new product in a new market is a very risky step.
Hilton Hotel can be considered as horizontal or vertical growth strategies to be followed.
Management of inventory and various techniques regarding inventory help them in reducing the
cost which is involved in managing the inventory in the business.
By doing a global expansion and reaching to the new market is a suitable strategy which
lead to the growth and success of business organisation. Hilton also have an option of making a
card of liability for their customers so that they can grab the discount and offers by coming again
in the same hotel. They have to make the strategies according to the market condition.
 Tactical actions: It refers to the the day-to-day operations of a business organisation
whose objective on the manner of business conduct and managers. Its main focus is on
how the business measures their performance and how the performance can be
monitored.
Hilton Hotel is required to recognise the various reasons of health issues in their services, by
managing the quality of their services leads to the the decrease in cost of doing business. It also
leads to the improvement of customer support services. They can also launched the feedback
questionnaire that they can improve the performance of their organisation according to the the
needs of customers.
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CONCLUSION
From the above report it is concluded that the hospitality sector have various customers with
different needs and wants and the organisation have various marketing and pricing methods. It is
found that the organisation should be flexible so that they can adopt the preference of customer
needs and wants in order to to gaining the advantage of competition. Along with this it is also
analysed that in the modern business environment, Rapid technological advancements can be
considered as the effective method which an organisation should follow. It is suggested to Hilton
Hotel that they should stay aligned and they should modify their services accordingly. Market
development, product development, penetration and differentiation studied strategies can be
accepted.
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REFERENCES
Books and journal
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