Strategic Analysis of Grosvenor Group's Hospitality Business

This report provides a comprehensive strategic analysis of Grosvenor Group's hospitality business. It begins by identifying the external macro-environmental factors influencing the industry using the PESTLE framework, examining political, economic, social, technological, legal, and environmental factors. The report then delves into the internal environment and capabilities of Grosvenor Group through SWOT and VRIO analyses, evaluating its strengths, weaknesses, opportunities, and threats, as well as the value, rareness, imitability, and organization of its resources. Furthermore, the report applies Porter's Five Forces to assess the competitive landscape, including competitive rivalry, the threat of new entrants, supplier power, buyer power, and the threat of substitutes. Finally, the report demonstrates various models that interpret the strategic management plan of the hospitality industry, offering a holistic view of Grosvenor Group's strategic positioning and competitive dynamics within the global market.

Unit – 41
Hospitality
Business
Strategy

Table of Contents
INTRODUCTION..........................................................................................................3
PART A.........................................................................................................................3
TASK 1..........................................................................................................................3
P1. Identify appropriate frameworks that influence external macro environment of
hospitality industry.....................................................................................................3
TASK 2..........................................................................................................................5
P2. Determine the internal environment and capabilities of hospitality industry by
using suitable frameworks.........................................................................................5
TASK 3..........................................................................................................................8
P3. Apply Porter’s Five Force strategy for evaluating competitive strategies of an
organisation...............................................................................................................8
PART B.......................................................................................................................10
TASK 4........................................................................................................................10
P4. Demonstrate various range of models that interpret in strategic management
plan of hospitality industry.......................................................................................10
CONCLUSION............................................................................................................13
REFERENCES...........................................................................................................14

INTRODUCTION
The business strategy refers as ability of managers to develop an innovative
idea in planning as to compete with rivalries for sustaining in global market. It is most
important for an organisation to achieve its long term goals and objectives within
particular duration by developing good employing relations. The organisation
selected for this project is Grosvenor Group. Company offers wide range of attractive
services to customers and have its headquarter in United Kingdom. This project identifies
appropriate frameworks that influence external macro environment of hospitality
industry. It further determines the internal environment and capabilities of
organisation by using suitable frameworks. Additionally, it applies Porter’s Five Force
strategy and various ranges of models that interpret in strategic management plan of
business.
LO1
P1. Identify appropriate frameworks that influence external macro environment
of hospitality industry
Business Strategy:- The business strategy of hospitality organisation reflects
its success and failure in achieving business objectives. The managers of an
organisation focus on developing management plan for improving the performance
of an organisation. Managers of Grosvenor Group are highly conscious and aware
about the strategies adopted by its rivalries for competing with them through
increasing competitive strategies. A business aims to create specialised vision and
mission in order to complete task within particular duration (Fernández and Becerra,
2015).
Grosvenor Group:- Grosvenor Group was founded in the year 1677 and
offer different types of services and products to customers. This entity is offering high
quality services to consumers with having more than 10,800 employees. In addition
to this it has been evaluated that this company is serving worldwide.
PESTLE Analysis:- This framework is a tool mostly used by marketing
managers to determine the macro-environmental factors that impact the business
activities either positively or negatively. It is essential for an organisation as to

analyse the controllable and uncontrollable risk that has to be minimised efficiently
by taking precautionary steps for sustaining in global market. Managers of
Grosvenor Groupimplement this PESTLE analysis for comparing their strategies with
competitors by strength and weakness (Gomes and et.al., 2014).
 Political:- The political factor includes government policy, labour and
environment law, political stability or instability, foreign trade policy,
corruption, etc. Managers of Grosvenor Group operate lodging in more than
dozen countries and expose themselves in accordance with rules and
regulations of political leaders. Grosvenor Groupis favourably affected as
government of United Kingdom mostly remains stable as there is no
consequent change in political parties.
 Economical:- This factor involves economic growth, exchange rates,
disposable income of consumers, inflation rates, etc. The managers of
Grosvenor Groupare adversely affected because of inflation rates that tend to
increase the price level of money and decrease its value. This result in
reduction of sales as consumer disposable income is less for saving money in
unnecessary expenses and postponing their plans for vacations.
 Social:- The social factor focus on sharing beliefs and attitudes of people in
society. This consists of population growth, career attitudes, age and income
distribution, health consciousness, etc. Managers of Grosvenor Group are
favourably affected as they create job opportunities for their society that result
in increase of employment (Li and Dimitratos, 2014). It creates opportunity for
growth and stability of business by developing their customers support and
loyalty. Grosvenor Groupis beneficial by high birth rate that leads to
population growth which result increase in their sales and profitability ratios.
 Technological:- This technological factor includes automation, research and
development, innovation, technological change and awareness, etc.
Managers of Grosvenor Groupare favourably affected as they adopt various
new technologies or softwares that lead to develop change in infrastructure
and complete task efficiently. Grosvenor Groupfocus on improving and
transforming their equipments as to develop drastic change in hotel for
attracting large number of customers with qualitative services.

 Legal:- The legal factor includes health and safety, equal opportunities,
advertising standards, consumer protection rights, product labelling and
packaging, etc. Managers of Grosvenor Group are unfavourably affected as
they are bound to follow legal legislations imposed by government (Mosley,
2014). Grosvenor Group further provides minimum wages to its workers
whether they are productive or unproductive. It is essential to motivate active
workers through monetary or non-monetary rewards as to develop eagerness
for leading hotel to achieve success efficiently.
 Environmental:- The environmental factor involves tourism, farming,
agriculture, weather, climate, geographical location, global changes,
environmental protection rights, etc. Managers of Grosvenor Groupemphasize
on this factor for analysing the global change in environment such as
Tsunami, Earthquake, Cyclone, Corona Virus, various other natural disasters,
etc., that affects the business operations. Grosvenor Groupis unfavourably
affected as it delays in goal accomplishment and lacks in competing with
rivalries that are Marriott International, Hilton Hotels and Resorts, Ritz Hotel,
etc. It further aims to take precautionary steps for minimising these threats of
competitors that impact for instability of business in global market.
LO2
P2. Internal environment and capabilities of Grosvenor Group with suitable
framework
The internal environment of an organisation consists of culture, members,
events and various factors within the business that influence the decision making
procedure of managers. It majorly depends upon the behaviour of human resource
such as owners, managers, leaders, employees, materials, etc. Managers of
Grosvenor Group focus on internal environment by applying SWOT Analysis and
VRIO model for its organisation to compete with its rivalries (Remler and Van Ryzin,
2014).
SWOT Analysis:- The main purpose of SWOT matrix is to identify strategies
of an organisation that leads to increase strength and opportunities for controlling
weakness and threats. Grosvenor Group implement SWOT analysis as to eradicate

weakness by intrinsic strength and restrict threats by developing more opportunities.
It is most important for Grosvenor Group to increase competitive strategies as to
sustain in global market by competing with rivalries.
Strength (S) Weakness (W)
 The Grosvenor Group is having
strong market presence that leads
to expand hospitality industry by
developing trust and faith of its
targeted audience.
 Grosvenor Group emphasize on
providing high level of satisfaction
to its end-users by building good
customer relationship
management that leads to analyse
the change in their taste and
preference.
 Grosvenor Group face weakness
in not able to invest more on
technologies as they pertains that
adoption of new equipment will
leads in high cost as being
obsolete in future.
 Grosvenor Group have limited
market share with very low brand
diversification that result in
decrease of sales and profitability
ratios.
Opportunities (O) Threats (T)
 Grosvenor Group are
advantageous in enlarging their
customers through online or digital
marketing that tends to attract
visitors by providing image and
video of hotel for converting them
to their clients through solving
their queries.
 The adoption of new technologies
provides an opportunity for
Grosvenor Group in
manufacturing services at
differentiated pricing strategy in
new market. It increases customer
support and loyalty by supplying
them qualitative services.
 Grosvenor Group face challenge
of high competition with its
rivalries in perfect competition
market (Sahebalzamani and
Bertella, 2018).
 Grosvenor Group is mostly
unfavourable and adversely
affected by the terrorist attacks
that result for instability of
organisation.

VRIO Model:- This is defined as an analytical technique which leads
company to analyse its resources for utilising them effectively in order to sustain in
global market. Grosvenor Group implement this model as a tool in strategic planning
for developing its effective decision-making procedure to improve competitive
strategies.
Resources Valuable Rareness Imitability Organized
Food and
Beverage
Service
Yes No No No
Kitchen
Operation
Yes Yes No No
Infrastructure Yes Yes Yes No
Green
Environment
Yes Yes Yes Yes
It is further explained with describing the effective use of scarce resources by
managers of Grosvenor Groupwithin global market by developing its competitive
strategies (Sainaghi, R. and Mauri, A., 2018).
 Valuable:- The managers of Grosvenor Groupmajorly focus on their food and
beverage services as to meet the needs and wants of clients for enjoying
luxurious and comfortable lifestyle in hotel. This enhances clients to entertain
with qualitative services provided by managers of hotel to spend their
vacations effectively at least cost pricing strategy.
 Rareness:- Managers of Grosvenor Groupemphasize on their kitchen
operations as to bring fresh material or ingredients for cooking food as per the
requirement of client by being aware of customers health. The main motive of
hotel managers is to be conscious about health of clients and take necessary
steps for providing them nutritious and qualitative food services with proper
packaging.
 Imitability:- The managers of Grosvenor Group focus on building their
effective infrastructure through beautiful interior designing of rooms (Song,

Park and Lee, 2017). As being differentiated from its rivalries and quite
difficult to be copied by them. It attracts large number of customers to survive
their livelihood in pure and creative environment of rooms with facilities of
LED, beds, lamps, etc.
 Organized:- Managers of Grosvenor Group emphasize on developing their
business structure within good atmosphere as they plant more and more trees
in surrounding that provides fresh and pure air to breathe. This result in
increase of sales, profitability ratios and maximise market share in perfect
competition market for being stable at its position.
From the above mentioned VRIO model, the managers of Grosvenor
Groupfocus on developing good infrastructure with beautiful interior designing of
rooms that leads to enlarge customers.
LO3
P3. Apply Porter’s Five Force strategy for evaluating competitive strategies of
an organisation
Porter’s Five Forces strategy:- This model was published by Michael E.
Porter in 1980, for analysing the competitive strategies adopted by industry rivalries
for being stable in global market. The managers of Grosvenor Groupimplement this
strategy as to determine the intensity of competition of an industry with its profitability
level. It is essential for an organisation as to minimise its barriers by developing
various strategies to increase strength and opportunities for overcoming weakness
and threats.
 Competitive rivalries:- It has been evaluated that there is high competitive
rivalries in hospitality sector, as there are number of other entities those are
offering products and services to customers in competitive price range.
(Taghian, D’Souza and Polonsky, 2015). It is most important for Grosvenor
Groupas to examine their strategies for developing strategic management
plan as to restrict the adverse impact of rivalries by supplying qualitative
services to its customers that increase loyalty.
 Threats of new entrants:- According to the evaluation it has been evaluated
that Grosvenor is facing low threat of new entrants, as new entrants required

to make high investments in order to establish themselves in marketplace. By
taking opportunity of this Grosvenor Group can serve more number of
customers and can enhance their brand image for more profitability.
 Power of Suppliers:-There is low power to supplier in hospitality sector as
suppliers wants to conduct their business operations with leading entities like
Grosvenor. Thus, this creates significant opportunity for respective hotel as
they can effectively negotiate prices for raw material and can further conduct
their operations in cost effective manner. It enhances their profit earning
capabilities in effective manner.
 Power of Buyers:- Hospitality industry is having high power of buyers, as
there are number of organisations those who are offering same services and
products in affordable price range. Thus, to develop good customer
relationship in competition market it is essential for Grosvenor Group to offer
qualitative goods and services at low cost to customers. The buyers are
always considered as King for an organisation that tends to provide services
at least cost for increasing sales with the motive to ascertain high profits in
future (Umeze and Ohen, 2015).
 Threats of Substitutes:- There is high threat of substitution in hospitality
industry, as it has been seen that rivals also adopted strategies by its
substitutes in developing similar products and analyse the variance by
comparing their strategies. Thus, it is essential for Grosvenor Group to focus
on building corporate social responsibility by meeting the needs and wants of
customers through supplying them qualitative goods at low price. This
enlarges customer growth and result in high market share for sustaining in
perfect competition market.
From the prescribed Porter’s Five Force strategy, the managers of Grosvenor
Groupmajorly focus on this as to analyse their competitors which are Hilton Hotel,
Marriott International, Ritz Hotel, etc. The main purpose for identifying this is to
minimise threats by developing precautionary steps for restricting errors. Managers
provide training and development programs to improve and update skills for taking
effective measures to reduce threats.

LO4
P4. Demonstrate various range of models that interpret in strategic
management plan of hospitality industry
Ansoff’s Growth Vector Matrix:- It is a strategic planning tool that provides
framework for managers to execute their plan in order to devise competitive
strategies for future growth of company. Managers of Grosvenor Group implement
this as to identify company’s earnings retention rate by its return on equity for
competing with its rivalries.
 Market Penetration:- It is the process through which managers of an
organisation aims to achieve growth with their existing growth in global market
by building its competitive strategies. Managers of Grosvenor Groupfocus on
this as to provide various services in their hotel at least-cost effective pricing
strategy that tends to attract large number of clients with luxurious and
comfortable lifestyle (Vellas, 2016).
 Market Development:- The managers of Grosvenor Group seeks growth by
targeting its existing products with new market segments. The main purpose
for managers of Grosvenor Group is to increase brand awareness and
positioning by expanding their existing business at various locations. It leads
to develop core competence with its rivalries by developing good relation with
its customers that increase its support and loyalty.
 Product Development:- Managers of Grosvenor Groupfocus on developing
various strategies for developing specialised new product and service with the
motive to meet requirements of its customers. It is essential for an
organisation as to develop strategic management plan with innovative idea for
competing with its rivalries in order to sustain in perfect competition market.
This emphasizes managers of company to develop new product and services
for enlarging customers for maximising sales and profitability ratios.
 Diversification:- It is the most risky from these four growth strategies, as it
requires both product and market development for an organisation to increase
its core competence for sustaining in global market. Managers of Grosvenor
Groupcan use this strategy for taking high risk in order to manage it effectively
and generate high rate of return in future period.

From the above mentioned Ansoff’s Growth Vector matrix, managers of
Grosvenor GroupCorporation mainly focus on product development as it aims to
provide various services in hotel for enlarging customers. These services include
spas, gyms, children welfare, library for improving knowledge, etc. It results in
maximising profits and market share with social welfare.
Strategic Management Plan:- This strategic management plan is described
as a document which is used to communicate the organisational goals, priorities,
focus energy, strengthen opportunities, etc. It is essential for business to ensure that
employees and stakeholders are performing their activities with the motive to
achieve common goals and objectives. Managers of Grosvenor Groupimplement this
plan as to provide a sense of direction for outlining the measurable objectives in
order to achieve success efficiently.
Features Explanation
Vision The vision of Grosvenor Group is to develop a world for
understanding and caring about their clients.
Mission The mission of Grosvenor Groupis to deliver distinctive
experiences for their guests by providing them adventurous
livelihood that is mostly memorable.
Objectives The main purpose for managers of Grosvenor Group is to
care for people, so they can survive their life with luxurious
and comfort zone.
Values The values of Grosvenor Group are to respect, integrity,
humility, empathy, creative and sharing fun as core values.
Marketing Strategies The marketing strategies for managers of Grosvenor Group
is mentioned as under:-
 Improve qualitative services by 5% within 2020:-
The managers of Grosvenor Groupfocus on providing
qualitative services for encouraging them to book
accommodation in the hotel.
 Enlarge customers by 10% in 2021:- Managers of
Grosvenor Group emphasize on its customers through
providing them services at least cost which result in
maximising sales and profitability ratios for competing

with its rivalries. It further develops support and loyalty
of end-users.
Tactics The tactics mostly implemented by managers of Grosvenor
Groupare shown as under:-
 Develop catchy taglines for variety of services:-
The managers of Grosvenor Group are beneficial as
they develop catchy taglines which position in the
mind of target market and improve its brand
awareness with its high sales and market share.
 Build good relations among employees and
customers:- Managers of Grosvenor Group are
advantageous as they build good relations with its
employees that leads to complete target at particular
duration with collaboration and engagement. It further
develops customer relationship management that
leads to analyse the change in taste and preference of
its customers.
Potential Customers The managers of Grosvenor Group emphasize on their
potential customers by segregating them into three
categories which are as follows:-
 Market Segmentation:- The managers of Grosvenor
Groupsegments their target market into various age
groups such as (12 to 20), (21 to 30), (31 to 50), etc. It
further emphasize on children as to spend their
vacations on different place with entertainment,
teenagers who want to enjoy wedding days in hotel,
and the family tour for developing and spending good
time with each other.
 Market Targeting:- Managers of Grosvenor
Groupfocus on targeting their customers in order to
increase sale and profits for sustaining in global
market.
 Market Positioning:- The managers of Grosvenor