Hospitality Business Strategy: Radisson Hotel Analysis Report

This report provides a comprehensive analysis of the Radisson Hotel's business strategy within the hospitality industry. It begins with an introduction to business strategy and its importance, followed by an examination of the macro environment using PESTLE analysis, considering political, economic, social, technological, environmental, and legal factors. The report then assesses the hotel's internal environment and capabilities through SWOT and VRIO analyses, identifying strengths, weaknesses, opportunities, and threats, as well as valuable, rare, inimitable, and organizable resources. Finally, it evaluates the competitive forces affecting Radisson Hotel using Porter's Five Forces model, including the threat of new entrants, bargaining power of suppliers and buyers, and the threat of substitute goods, concluding with an overview of how these factors influence the hotel's strategic direction.

Hospitality business
strategy

Table of Contents
Introduction:.....................................................................................................................................1
PART A:..........................................................................................................................................1
Analyse the impact and influence which the macro environment has on a hospitality
organisation and its business strategies..................................................................................1
Assess a hospitality organisation internal environment and capabilities.............................2
Evaluate and apply the outcomes of the analysis using the porter ‘s five forces model........5
PART B:...........................................................................................................................................7
Apply the models, theories and concepts to assist with the understanding and interpretation of
the strategic direction.............................................................................................................7
Conclusion:....................................................................................................................................10
References:.....................................................................................................................................10

Introduction:
The business strategy plan of the organisation refers to the course of action which helps the
company to achieve their goals and objective in the most effective and profitable manners. The
strategy is one of the important essential tools and technique which are used by the organisation
to complete the task in the most efficient manners. In the other words, it can be stated that
hospitality business strategy is a process where organisation make effective strategies plan to
achieve their mission and vision of the organisation in the long run. Under this report, the
Radisson hotel is a international hospitality organisation working across the countries and
offering premium services to the target customer and having headquarter in the UK market
places and offering its services at the global market places. Further the impact of the internal and
external environment on the hospitality organisation will be discussed and examine the porter’s
five forces on the organisation so that they are able to take competitive edge in the hospitality
industry. Apply different models and concepts for making effective strategic management plan
(Arun, and Sudha, 2017)
PART A:
Analyse the impact and influence which the macro environment has on a hospitality
organisation and its business strategies.
In the difficult and competitive scenario, the organisation need to examine the different external
factors which have impact on the productivity of the organisation and also affects the profits
margin in the market places. To examine the external factors, PESTLE analysis is used by the
Radisson organisation before making strategies for the growth plan.
PESTEL analysis: it is framework used by the organisation to making effective marketing
principle and strategies expansion plan for the company. This analysis helps the organisation
to examine the work environment in which it will perform its operational activities.
The purpose of the PESTEL analysis is to examine the various external factors which can
influence the performance of the organisation and make the effective business strategies which
helps them to achieve the profits in market places.
Political factors: under this factor, it includes the political condition , government rules and
regulation and various another foreign trade ant etc . with the references of the Radisson
organisation, this factor have huge impact on the functioning of the business activities. Due the
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Brexit condition in the economy ,it has made large changes in the government polices which
affects the hospitality organisation to large extend.( Song. and Yoo., 2016)
Economic factors: here different types of rates are included such as inflation rate, exchange
rates and currency rate which affects the performances of the organisation . the Brexit affect the
economics of the organisation in negative manners. The increase in the inflation rate will
decrease the purchasing power of customer which affects the profits of the organization.
Social factors: under this factors, the customer taste and preferences, their assumption and
belief system are taken into consideration be for making the sound business strategies. In the
context of the Radisson organisation, they focus on customer demand and offers good quality
of service so that more customer are attract towards the organisation in the long run and increase
the profits margin of the company.
Technology factors: here it involves the advance technology, innovative and artificial
intelligence and research factors . in the context of the Radisson hotel , they are focus on
offering the good services to its target customer so they need to use the advance technology to
improve their activities and servers the large number of customer.
Environment factors: the organisation uses the society resources to make goods and service
from which they make profits . so they are accountable towards the customer for using their raw
material by fulfilling the social responsibility . it also includes various environment laws which
are set of the government and are to be followed by the organisation. The hospitality industry
have to follow these laws to run their business effectively.( Arun,. and Sudha, 2017)
Legal factors: here the government apply the different laws and legislation which every
organisation have to follow to run their business activities in the smooth ways. In the relation
with the Radisson hotel, they using different guideline where all the function of the organisation
can be performed in better ways and overcome the complexities of the government laws at the
work place. It also help the organisation to achieve the desire level of the outcomes in the most
profitable manners.
Assess a hospitality organisation internal environment and capabilities.
SOWT analysis:
To examine and understand the internal factors of the organisation which have influence and
impact on the productivity of the organisation is evaluated by using SWOT analysis: it is tool
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which shows the organisation strength , weakness, opportunities and threats at the work related
places.in the relation with the Radisson hotel , SWOT analysis is discussed as below:
‘
Strength weakness
 The Radisson hotel is known for its
world class and premium services to
its customer which helps them to build
goodwill in the market place.
 This hotel always provide attractive
tourist places to its customer with the
good accommodation and other
facilities which helps then to grow their
business at international market .
 Due to tough competition in the
hospitality industry , the hotel is not
able to achieve the desire profits in the
market and expand their business
strategies.
 The hospitality sector , required huge
investment in the form of capital and
resource and labour which affects the
productivity of the hotel in the market
places.
Opportunities Threats
 Due to increasing demand in the
hospitality sector, the organisation
have a growth in this segment, with the
help of strategies they can expand their
activities and earn the desire profits.
 As the market is changing fast due to
new trends in the target sector, this
hotel have a opportunity to serve the
customer with new quality services and
build brand name .
 The Radisson hotel has to face the
competition in the market which lower
their growth rate in the target market
places.
 The economic in which Radisson
operates its activities are unstable
which harm the performances of the
organisation.
VRIO Analysis: It is analysis which act as strategies tool for the organisation in finding the
internal capabilities and strength of the organisation which helps them to achieve the desire
profits in the long run. It have four different type such as value, inimitability , rarity and
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organisable. In the context of the Radisson hotel, they uses this analysis to examine their internal
environment in better ways.
The organisation have various resources which helps them to examine their internal abilities and
improve their business strategies so that organisation are able to achieve the desire level of
profits in the long run. some of the effective resources are as stated below:
Resources Valuable Rare Inimitable Organisable
Brand value Yes No No No Competitive
complexity
Official
aptitude
Yes No No Yes uncultivated
similarity
financial
capital
Yes Yes Yes No Competitive
manageable
Human
supply
Yes Yes Yes Yes Provisional
equality
Physical
resources
Yes Yes No Yes Cultivated
resources
Valuable : creating the brand value by the Radisson hotel is a important part to take the
competitive advantage in the target market . the organisation focus on adding valuable services
and technique which help them to perform the all the functional activists of the Radisson hotel so
that final objectives can be achieved in the long run. Financial requirement are also valuable
essential aspect of the organisation which helps in enhancing the market share of the hotel
human resource are another valuable aspect of the company as they perform all the task in better
ways. (Šerić, Gil Saura. and Garbin Praničević,2016.)
Rare: official attribute of the organisation is not rare in the market but they focus on using the
different technique in their management which helps the customer to use the different services
in most effective manners. Financial source are on stronger side of the organisation which help
them to grow their business to next level .further the human supply in the hotel is also rare as
they hire good quality of staff in the hotel
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Inimitable: the financial part of the hotel is difficult to handle the working condition of the
organisation. It become easy for the organisation to use advance technology which helps them to
serve the customer in lesser time and provide good service to the customer.
Organisable: The Radisson hotel are able control and manage their financial essential and
human resources which provide them way to expand and have growth in the hospitality sector.
The organisation conduct various training and development programs where the employees can
learn the new things and provide good services to the customer.
Evaluate and apply the outcomes of the analysis using the porter ‘s five forces model.
Porter’s five force model: according to this model , the organisation it was a strategic tools
which helps the firm to examine the competition present in the market and focus on taking the
competitive advantage in the market. These force have impact on the productivity and
performance of the organisation and also influence the growth strategy of the hotel. It also helps
the organisation to achieve the desire level of results within the set time period. In the context of
the Radisson hotel , these forces are discussed as follow:
Threats of new entrants: Radisson organisation is will established company which is
providing its products and services from many year. This hotel is providing high quality services
to customers and this help in developing brand value. New entrant organisation need to have
huge capital and effective resource to enter in the hotel market as their high competition in the
target segment. The Radisson hotel focus on offering goods and services to its customer and
have less impact of new entrants in the market. So, new entrant force will have less impact on
Radisson hotel ( Feranita, Kotlar and De Massis., 2017)
Bargaining power of the supplier: Under this phase, there are more number of the
supplier in the European market that is providing different types of raw material to Radisson
hotel. The Radisson hotel , faces low pressure from the supplier and tries to offer better
services to its consumer and make effective business strategies. Here the Radisson hotel are able
to achieve competitive edge in the market and obtain their objectives in proper manners. This
organisation is collecting raw material for different suppliers which lead to reduce the bargaining
power of suppliers.
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Bargaining power of the buyers: In the context of the Radisson hotel, this company is
able to offers the various services to its potential customers that assist in meeting with their
requirements. This helps Radisson hotel to perform better as comparison of another organisation
providing the similar services to the customer. The organisation have build the strong brand
image in the customer mind which also helps them to expand their business. (Nair,, 2016) In
the relation to the Radisson hotel, the customer has a power to switch to another organisation if
prices are less offered by the other organisation. Due to low switch cost, the bargaining power of
customers increase. So this force has moderate impact on Radisson hotel profitability and
performance.
Threats from the substitutes goods: In the Radisson organisation, this threats is low
in the market place as the organisation are able to offer the various different type of services
and attract more customer from time to time and take the competitive advantage in the market
place. The business traveller uses the premium hotel to exercise their purpose of visit so this
hotel is able to provide the effective services to all kind of customer. (Hsieh,. and Wu, 2019)
Rivalry among existing competitors: According to this phase, the hospitality industry
have issues like competition from the existing organisation as there are large amount of hotels
in the market. In the context of the Radisson hotel, they provide effective service to its customer
at the reasonable prices which helps them to hold on the existing customer and attract more
customer towards the organisation in the present and long run. This company is dealing in
highly competitive environment and there is high force of rivalry among competitors.
In the context of the Radisson hotel , the porter five forces helps in understanding the
competition present in the organisation which helps them to make better business strategies.
Through this it has been analysed that Radisson hotel have major threat from bargaining power
of customers and threat of rivalry among existing competitors.
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PART B:
Apply the models, theories and concepts to assist with the understanding and interpretation of
the strategic direction.
The organisation operates it all the activities and function in the competitive market place
so that they can achieve the desire goals and objectives in the most efficient manners. To obtain
the objective in the profitable way and looking forwards to expanding their business activities
the organisation need to make the strategic plan after examining the market.
Ansoff matrix
It is matrix used as the tools and technique to understand the market make the growth
strategies for the organisation so that they can improve their performances and achieve the
desire result in the proper manner. With the references of Radisson hotel , the manager uses this
matrix, to examine the market and make sound strategies for the growth of the firm.
 Market penetration: under this part of matrix , the organisation aims to provide its
existing services to the already target market so that they can increase their market share
in the competitive market. In the context the Radisson hotel , the leader focus on
offering the premiums services to the existing consumer so that these customer will
become the loyal towards the firm and stay connected for the long period of time. Here
the organisation focus on enhancing the share of the firm in the target market. (Raina
and Kalse, 2018)
 Product development: according to this , the organisation uses best techniques
which will be increase the profitable and productivity of the firm by offering new and
advance services to the target segment so that customer can make use of these services
that will lead to better performance of the organisation in the market. In the context of
the Radisson hotel , their objective is to serve the customer and make the profits out the
such task . they provide new services in the market so that more customer will join the
organisation in the long run.
 Market development: Here the organisation aims for the entering into new market place
to offer their services to the customer and earn the profits margin in lieu. In the context
of the Radisson hotel, they are dealing with the different kind of services which can be
consumed by the customer so that they can plan to expand their business in different
market location and grow their operational business activities.
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 Diversification: according to this matrix, the organisation aims to enter in the particular
new market to target customer according to their needs and wants and with the new
services which will satisfied their need on time. In the context of the Radisson hotel, the
firm focus on expanding their business at different location by providing effective
services to the customer. Here the organisation are in developed stage where they are
planning to grow their business and take the competitive advantage in the market place.
Thus, through this it has been determined that product development strategy will be most
effective and efficient for Radisson hotel. It is important for this company to analyse and
identify that need of customers and create new offering that will lead to enhance the visiting
experience of customer.
Porter’s generic strategies
This strategies helps the organisation to understand the market condition in the better ways
which helps in taking the competitive advantages in the market places and build their brand
name in the minds of the customer:
 Cost leadership: here the organisation focus on providing the low cost for the goods and
services which helps them to achieve the desire profits in the market places.
 Differentiation: here the product of the Radisson organisation have high demand in the
organisation and they offer the new and unique kinds of the product and services to its
customer on the regular bases.
 Cost focus : here the Radisson hotel, focus on providing the goods at the lower prices
and have little competition with the another organisation.
 Differentiation focus : the manager of the Radisson hotel focus on offering the unique
features to the product and services which helps them to achieve their profits in the set
time periods
For Radisson hotel differentiation strategy will be most accurate and effective for
successfully performing business task and attaining goals. This strategy will help in creating new
and innovative offering with is not provided by any other rival company. Differentiation strategy
will assist in gaining competitive edge over other competitors companies.
Strategic management plan: it refers to the written document where the organization goals
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and objectives are stated and also includes the plan which helps the organisation to expand their
business in the international market place. The organisation also focus on achieving the
mission and vision in the long run by dealing with the aims and objectives, strategies and tactics
which can be followed by making effective strategies. In the context of the Radisson hotel,
making strategies helps them to grow their business at the international market .
Strategies: It provide the management plan which are made by the organisation to accomplished
the desire objectives in the most effective manners. The Radisson hotel need to make the sound
strategies plan to serve the desire number of customer and expand their business activities.
STP: Here the firm make the effective structure which provide the organisation their target
market where they can place their goods and services and earn the profits in the long run.
Segmentation: under this stage , the organisation make the segment of the whole market
according to needs and wants of the customer, their income level, age and gender so that
organisation can make the strategies as per the segment and provide them services according to
the segment so that customer gets services which they are looking in the market at the reasonable
prices.
Targeting: The organisation now target the different segment and provide the goods and
services as per the need of its segments and expand to the another demographic location which
helps them to entrant their business at different parts.
Positioning: Here the organisation focus on positioning its services in the target market by
promoting their services thought the different means where the customer can aware about the
goods and service which are offered by the organisation.
Objective: here the Radisson hotel uses SMART objective to make its strategies management
plan. The organisation focus on providing the better service to the customer so that they are able
to achieve their profits in long run and increase the market share in the different location.
Tactics: under this part, the organisation tries to dissolve the issues in the most effective
manners. In the context of the Radisson hotel, the organisation make the proper budget and plan
the another strategies in the most systematic manners so that they can earn the good margin as
well as expand their business.
.
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Conclusion:
According to the above discussion, it can be concluded that business strategy in the
hospitality industry plays the important part to achieve their objectives in the most effective
manners and helps in growing their business at the international market places by offering
advance services to its target customer. The effective strategic management plan helps the
organisation to perform its all activities in the proper ways . the firms used PESTLE and SWOT
tools to study the work environment and make good strategies for the achieving the desire
outcomes. The organisation also examine the porters five forces and Ansoff matrix to evaluate
the business environment and forces which can affects the productivity of the organisation in the
market and make the sound plan for the firm to obtain the goals and objectives in proper
manners.
References:
Ali, F., 2016. Hotel website quality, perceived flow, customer satisfaction and purchase
intention. Journal of Hospitality and Tourism Technology.
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On Job Embeddedness In The Hospitality Industry: A Mediation Study Of Organizational
Justice. International Journal of Hospitality & Tourism Administration, pp.1-29.
Arun, K. and Sudha, S., 2017. Explorating Employee Creativity as a Driver to Empower
Employees in Hospitality Industry. Indian Journal of Public Health Research &
Development, 8(4), pp.313-318.
Brea‐Solís, H., Casadesus‐Masanell, R. and Grifell‐Tatjé, E., 2015. Business Model Evaluation:
Quantifying W almart's Sources of Advantage. Strategic Entrepreneurship Journal, 9(1), pp.12-
33.
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