MHC610 Strategic Hotel Management: HOTS Hotel Strategic Report 2018

This report provides a comprehensive strategic analysis of HOTS Hotel, examining both its micro and macro environments using tools like SWOT, PESTLE, and Porter’s Five Forces. It identifies the hotel's strengths, weaknesses, opportunities, and threats, as well as the competitive forces at play withi...Read More

Running head: STRATEGIC BUSINESS MANAGEMENT
STRATEGIC BUSINESS MANAGEMENT
Name of the Student
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Author note

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Executive summary
The purpose of the report is to analyze the macro and micro environment of HOTS hotel in order
to understand the advantages and shortcomings of the company. In order to perform the above
mentioned analysis, SWOT analysis Porter’s five forces analysis and PESTLE analysis have
been conducted. After analyzing the environment, strategies have been developed in order to
help the hotel to achieve its goals. Finally it has been concluded that with the help of the
strategies the company will be able to gain prosperity in future.

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Table of Contents
Introduction......................................................................................................................................3
Discussion........................................................................................................................................3
Environmental analysis................................................................................................................3
Analysis of HOTS Hotel Micro environment..........................................................................3
Analysis of HOTS Hotel Macro environment.........................................................................5
Strategic Direction for HOTS Hotel............................................................................................7
Conclusion.......................................................................................................................................8
Reference List:.................................................................................................................................9

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Introduction
Strategic management can be defined as the process of formulating and implementing of
the chief initiatives and goals of an organization’s top management. This process involves
consideration of resources along with detailed analysis of external and internal environments, in
which the particular organization competes (Hitt, Ireland & Hoskisson, 2012). In this report,
detailed analysis of the micro and macro environments of the HOTS hotel have been performed
along with the developing strategic direction for the organization (Avilova, Ermakov &
Gozalova, 2014). While for analyzing the Macro environment of the company, PESTLE analysis
is performed, SWOT and Porter’s five forces model have been used to understand and analyze
the micro environment of the mentioned organization.
Discussion
Environmental analysis
Environmental Analysis helps an organization to understand both internal and external
condition that has direct impact on the prosperity of the organization. Once the management of
the organization becomes aware of the external and internal factors that are affecting the growth
of the business, the managers can successfully design long term business plan to cope up with
the weaknesses and availing the opportunities of the company (Grant, 2016).
Analysis of HOTS Hotel Micro environment
Micro environmental analysis includes analysis of the external factors that has direct
impact on the sales of a specific organization (Eden & Ackermann, 2013). These factors are

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beyond the organizations control. In order to analyze the Micro environment of HOTS hotel,
Porter’s five forces model have been used.
Porter’s five forces Model of HOTS Hotel
Bargaining power of the Buyers
Strength: Moderate
Considering the fact that the number of hotels with modern facilities and well constructed
structure are present in Brisbane, tourists have a great number of options to choose from.
However, since HOTS Hotel is situated at the town centres and has a minimum distance from the
shopping centers, these two factors add competitive advantage for the mentioned hotel in
Australia since tourists prefer hotels that are nearer to the shopping centers.
Bargaining power of the suppliers
Strength: High
As mentioned earlier, a good number of hotels are present in Brisbane (Vecchiato, 2012).
As a result, the suppliers of goods and services of the HOTS hotel have a number of options to
provide their services. This means, if sufficient wages and value for the products supplied or
services given is not provided by the mentioned hotel, suppliers have the option to shift.
Threat of new entrance
Strength: Low
Due to the high barriers of entering the hotel industry in Australia along with the complex
entry laws and legislation implemented by the government, the threat of new entrance for the

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HOTS hotel is low. Apart from that, the amount of money needed to establish a successful
business in the hotel industry is another reason behind the less amount of entry in this industry
(Hill, Jones & Schilling, 2014).
Threat from substitute
Strength: Moderate
Considering the fact those services provided by the hotel industries in Brisbane are highly
similar, every hotel management including the management of HOTS hotel is trying to introduce
innovative leisure services to attract consumers.
Threat from existing competitors
Strength: High
Considering the fact that there exist a good number of hotels in Brisbane, high
competition exists between them (Wheelen et al., 2017). Since tourists seek for the best
experience for the best price, the tendency of the hotels in Brisbane is to reduce the price to gain
competitive advantages.
Analysis of HOTS Hotel Macro environment
A macro environmental analysis includes analysis of the whole economy of a country
rather than analyzing a particular sector. In order to conduct macro environmental analysis of the
HOTS Hotel, PESTLE analysis has been performed (Tanwar, 2013).
PEST Analysis

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Political Economic Social Technological
Being a developed
country, the government
of Australia and hence,
Brisbane is stable. This
imposes a positive
impact on the
hospitality industry
(Tansey, Spillane &
Meng, 2014).
Since the economy of
the town has developed
due to the relocation of
several business firms,
the economic condition
of Brisbane is favorable
for establishment of
hotel industry.
Since the local people
have commendable
willingness and
availability to work, the
social condition of the
town is also favorable
for hospitality industry
(Dunning, 2014).
Since Brisbane is a
developed town, the
town is highly advanced
in technology. Thus the
hospitality industries in
Brisbane can avail both
offline and online
facilities to enhance
their quality of services
to the consumers.
SWOT Analysis
Strengths Weaknesses Opportunities Threats
 Highly
attractive
location
 Number of
facilities
provided to
the consumers
are
commendable
 Deterioration
of
revitalization
plan
 Lack of
training
provided to the
staffs
 HOTS hotel
has the
opportunity to
gain more
market shares
by
understanding
the needs of
the
 High turnover
rates of the
employees.
 Presence of
high amount
of
competitors.

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 Specious and
highly
comfortable
rooms.
consumers.
 The quality of
the service
given can be
enhanced by
incorporating
new cuisines
to the menu
list.
Strategic Direction for HOTS Hotel
From the above analysis the management of HOTS Hotel has derived several strategies to
cope up with the competitive market. While the vision of the Company is to provide the
consumers with a larger than life experience, the mission of HOTS hotel is to motivate and
employees and other stakeholders by proving proper facilities and training. In order to achieve
the goals and objectives of the hotel, Porter’s generic strategies have been implemented by the
management. The mentioned strategy is comprised of cost leadership strategy, product
differentiation strategy and focus strategy (Dudin et al., 2014). While the cost leadership strategy
includes reduction of the costs while keeping the quality of the service high, the focus strategy
includes providing the staffs with efficient training and focusing more on revitalization
(Bharwani & Mathews, 2012). The product differentiation strategy involves attracting the

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tourists by providing unique facilities like special offer packages, free welcome drinks and gifts
on the basis of lucky draw facilities.
Conclusion
From the above report it can be concluded that it is very crucial to understand the external
and internal environment of HOTS Hotel in order to understand its shortcoming and
opportunities. In order to overcome the issues that have been detected from the environmental
analysis several strategies have been developed. It can be clearly understood that HOTS hotel
needs to implement the strategies effectively in order to achieve its mission. The strategies will
not only help the hotels to gain competitive advantage but will also ensure its prosperity in the
future.

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Reference List:
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Bharwani, S., & Mathews, D. (2012). Risk identification and analysis in the hospitality industry:
Practitioners' perspectives from India. Worldwide Hospitality and Tourism Themes, 4(5),
410-427.
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