Hyatt Hotel: Macro Environment and Strategic Decisions Report

This report provides a comprehensive analysis of Hyatt Hotel's business strategy. It begins with an introduction to strategic management and business strategy, then delves into the impact and influence of the macro-environment on the hospitality organization. The report employs frameworks like PESTEL and SWOT analysis to assess external factors and internal strengths and weaknesses. It examines strategic management decisions, internal capabilities using the McKinsey 7-S framework, and competitive forces using Porter's Five Forces model. The report explores strategies for improving competitive edge, strategic directions, growth platforms, and strategic planning models. The conclusion summarizes the key findings and provides recommendations for strategic actions, objectives, and tactical plans for Hyatt Hotel.

HOSPITALITY BUSINESS
STRATEGY

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................3
MAIN BODY..................................................................................................................................3
Business strategy.........................................................................................................................3
Impact and influence of macro environmental on hospitality organisation................................3
Strategies or frameworks applied by an organisation for macro environment...........................4
Strategic management decisions of an organisation on macro environment...............................5
Internal environment and capabilities of an organisation............................................................5
Porter’s five forces model............................................................................................................6
Appropriate strategies to improve competitive edge and market position..................................7
Strategic direction available to the organisation..........................................................................7
Recommended appropriate growth platform and strategies........................................................8
Model and theories of strategic planning in an organisation.......................................................9
Strategic management plan........................................................................................................10
Valid strategic directions, objectives and tactical actions for a hospitality organisation..........11
CONCLUSION..............................................................................................................................11
REFERENCES................................................................................................................................1

INTRODUCTION
Strategic management is the function of an organisation for planning long term goals and
objectives for the future success. Business strategy involves all types of strategy in which an
organisation has to expand or wants to make profits (Rabetino, and et.al., 2021). Hyatt hotel is a
largest hospitality company in the world which is providing its services globally. This report will
include analysis the impact and influence of the macro environment in an organisation and its
strategies by applying appropriate frameworks such as PESTEL and SWOT analysis and
determining and informing strategic management decisions. Further, it will include analysis of
internal environment and capabilities of an organisation using appropriate frameworks and
evaluating the internal environment to assess strength and weaknesses of an organisation’s
internal capabilities, structure and skill set. This also include applying porter five forces model
fro evaluating the competitive forces of a given market and appropriate strategies to improve
competitive edge and market position. Moreover, evaluating the different type of strategic
directions and using most appropriate growth platform and strategies and applying range of
model, concept for strategic planning and explanation of the objectives. Lastly, product strategic
development plan and producing a valid strategic directions, objectives for an organisation.
MAIN BODY
PART-A
Business strategy
Hyatt hotel is UK’s largest hotel providing various types of tourism and luxury services to
the customers worldwide with having its branches internationally (Kumar, and et.al., 2021). This
hotel is owned by Pritzker family of Chicago and it has 210 hotels and resorts in all the 43
branches around the world. This company due its large operation has to plan various business
strategy for long term goals and to have competitive advantage in the future in the hospitality
sectors.
Impact and influence of macro environmental on hospitality organisation
The hotel Hyatt has to face various macro environment factors due to its large operation
world wide (Chaouk, 2020). The macro environment factors affects working of the business due

to various legal political factors. This hotel has to face various internal factors like suppliers,
customers, public, employees etc they all affects the goals and objectives of the firm. This hotel
is suing various strategies and frameworks to identify this factors for protecting the goals from
any uncertainty.
Strategies or frameworks applied by an organisation for macro environment
SWOT analysis
This analysis used by the company for knowing all its strength and weaknesses present in
a company like: Strength: The company through this analysis find out all the internal strength and
capabilities of the company through which it can achieve its goals more efficiently like
excellent and professional workforce or financial resources available to the company etc
(Istan, M. and Fahlevi, M., 2020). Weakness: They are the weaknesses of a company which has to be improved for better
performances like weak strategies and poor advertisements etc. Opportunity: All companies have great amount of opportunity available to them which
has to be look deeply like opportunity for expansion and growth etc this helps in
constructing better future performances for the firm (Ahsan, M.M., 2020). Threat: Threats are the fear of companies due to huge competitions and substitutes
available the Hyatt hotel if wanted to be successful need to identify early this threat so
that strategies can be planned to overcome this threats.
PESTEL analysis
This is the tool for determining and identifying all the external factors which are affecting the
companies performances. Political factors: They are factors like political stability of different countries, taxation
and rules or regulation by government of different countries and changes in any of this
factors affect the working of the business (Teoli, 2019) Environmental factors: The environment protection is important and its rules and
policies has to be followed by all the countries and companies. The factors like safety
need of consumers, reducing use of harmful gases etc and changes in this policies affects
the business environment of the firm

 Social factors: All the social factors like age, education, family size etc can increase
decrease the demand of the company products due changing environment due different
taste and preferences (Abdullah, and et.al., 2022). Technological factors: Using of more advanced technologies by the competitors will
reduce the customers of the company which are using old technologies. Economic factors: Change in inflation, deflation, interest rates, consumption rates will
affects the business environment of Hyatt due to worldwide operation. Legal factors: Various laws prevailing in the market like business law environmental law
health and safety law etc affects the business operations.
Strategic management decisions of an organisation on macro environment
Hyatt hotel after determining all the factors internal and external has to prepared strategies
for overcoming from the factors which are coming in the process of achieving goals in the long
run. This hotel with the help of strategic decision making team need to decide all the strategies or
decisions which has to be taken for improving the present as well as future performances for
increasing the sales and revenue. The reason for the strategic decision making is to plan various
strategies for facing all the macro future uncertainty factors the strategies are:
 Decisions regarding using the strength and opportunity of business in a way to improve
the overall strategies of the company (Salim, and et.al., 2019).
 Strategies for reducing the affect of threat and weakness of the firm.
 Forecasting all the environmental factors social, political, technological etc for taking
decisions for planning strategies for reducing the affect of future uncertainty.
Internal environment and capabilities of an organisation
The internal environment and capabilities of an organisation are the strength and
opportunity of an organisation with which it can achieve any goal and objectives. Internal
environment are members itself , investor of the company and assets (Chmielewska, and et.al.,
2022). The Hyatt hotel has huge number of skilled staff, huge number of assets due to large
operations worldwide. This hotel is using all the latest technologies and corporate cultures for
achieving the goals and efficiently. This hotel is using appropriate framework for determining all
its internal capabilities for achieving the success for future.
Mckinsey’s 7s framework

The hotel Hyatt is using this framework to know its internal environment all the
efficiency, effectiveness and capabilities. This model depends upon 7 internal factors of an
organisation are: Strategy: The hotel with the help of this model developing well-aligned strategy for
remaining competitive in the long run with increasing profits and sales (Isabelle, and
et.al., 2020). Structure: The structure or division of units decides the efficiency of work in an
organisation the company has to select the best structure for maintaining cooperation and
coordination in the work.
 Systems: They are the process of day to day activities how the activities has to be
performed with what kind of employee etc. Skills: They are the staff or employees skills or knowledge of doing the work with full
accuracy for attaining the overall goals. Staff: This is the selection of appropriate number of staff needed for the work and
selecting trained and professional staff for the overall efficiency of the work while
performing the task. Style: The style can be of many types like all the decisions are taken by the top
management or employees are involved in the decisions particular situation need
different styles (Bulturbayevich, M.B., 2021). Shared value: They are sum up of all the employees behaviour their contribution and
their efforts in an organisation for achieving the goals.
From the above model all the internal strength, weaknesses, capabilities, structure and skill
set is determined so that strategies can be planned according to the needs of an organisation with
its internal capabilities.
Porter’s five forces model
This model is used by Hyatt hotel for finding its competitive forces prevailing in the
market and understanding the competitiveness of business environment. This developed
framework to explore the competitive market forces of Hyatt hotel and helps in determining the
strength and weaknesses. It has five forces that affects the competition which are: Bargaining power of suppliers: If the suppliers of the company are few and can
influence the price by reducing its cost due to unique products and unique brand the

bargaining power of supplier is high and its is beneficial for the company to has full
control on price (Cho and Han, C., 2019). Bargaining power of buyers: If the bargaining power of customers is due to more
availability of substitutes and products which has less importance in market and has less
customer affects the profits of the firm. Competitive rivalry: The rivalry of the firm affects the performances because more the
number of competition in the market due to same products and services more danger is
for the company (Cheng, and et.al., 2021). The threat of substitute products; If the company has more number of substitutes in the
market then it cannot earn huge profits and vice versa. The Hyatt hotel will be more
competitive if they provide product which has no or less number of substitutes fro
earning huge profits. The threat of new entry: More the number of new entry in the market more will be the
competition in the market and the new entry will come up with more advanced ideas and
unique products which become tough competitions for the existing company.
Appropriate strategies to improve competitive edge and market position
 The most appropriate strategy used by Hyatt hotel is using its internal strength in a way
so that all the internal strength like skill or efficiency of the work can be accomplished
with coordination and cooperation.
 Another strategy is developing an appropriate structure in which the communication
regarding any work or decisions can be taken with full support or agreement by whole
company contribution.
 Remaining competitive in the market the company must use new and latest technologies
so that cost of production can be reduced and profits can be increased.
 Using various best-cost strategy and low cost strategy for maintain all the cost for long
term goals and increasing the profits.
PART-B

Strategic direction available to the organisation
The Hyatt hotel is using various strategic direction and using various models for making its
planned strategies to be successful in the future with expert team. This Hyatt hotel is using
vertical/ horizontal integration strategies for remaining competitive in the market for future long
term goals.
Vertical/ Horizontal integration strategies
Vertical integration is used by the company’s to have full control over its supply of its
raw materials and full control over some particular product line for reducing the cost and making
its sales or profits more (Soares, 2018). Hyatt hotel is using this strategies to making full control
over its some departmental areas like purchasing the land or removing the burden of lease or rent
and giving its customers all hospitality services by improving its inbuilt staff for providing all
type of services. The hotel can takes over one or more other companies that are distributing or
supplying raw materials to this company for having full monopoly in its work.
Horizontal integration strategies are also used by this hotel for expanding its business in
other foreign countries for earning more with more increasing number of customers. This hotel is
acquiring one or more business activities like fast food restaurant and other tourism facility chain
activities so that it can have competitive advantage in the market or earn huge profits with help
of merging with another company with the same products and procedures etc. This strategy helps
company to expand its business like grow in size, new markets, diversifying products and less
competitions etc. because its efforts will gets twice due to merging and acquiring of business and
the customers of both companies will enjoy more benefits with more diversification and
advancement in the activities.
Recommended appropriate growth platform and strategies
For the growth of the business in the long run the company uses various strategies and
platforms or growing their markets with growth strategy. Hotel Hyatt is using growth model
named Ansoff matrix for making its strategies for the growth of its hotel and increasing its
customers.
Ansoff matrix
This tool helps the company understanding the market and plan strategies for growing its
market for future long term goals and earning more profits with sustainable growth or more
competitive advantages in the future. This model uses four strategies which are as follows:

 Market penetration: This strategy is used by the company for increasing its existing
products and services by various techniques for increasing its customers with various
promotional methods. This strategy is used by Hyatt hotel in which it increases its
advertising for attracting more number of customers or reducing the price with reducing
cost of production, merging with other company with same business activities to grow in
the market , improving the products and making its look more attractive to customers or
improving its customer services etc (Kurniawan, and et.al, 2020). Market development: This is a big strategy in which the company’s try to expand its
market in other cities or country for more growth and increasing customers. This method
has great success if the company is successful in proving its goods and services in other
country’s with customer satisfaction and has little risk if the situation is vice versa. Hyatt
hotel already has many branches and still planning for increasing more to become wolrd
largest tourism or hospitality country. Product development: This strategy also involves some kind of risk due to developing
the products for selling more variety of products and developing various services to the
target customers and making more options available to the customers for more
satisfaction. This hotel is developing various strategies for proving various additional
facilities to the customers and adding more options of tourism available to the customers
for earning and growth (Schaefer, and et.al.,2021). Diversification: This is the most risky strategies for the company to apply due to
diversifying its operation due to more growth like some related products and unrelated
products. The hotel has to be careful by using this strategies due to more risk.
Model and theories of strategic planning in an organisation
The Hyatt hotel is using most appropriate model which are used universally which involves all
the aims, objectives, mission of the company.
Basic model
This basic strategic planning involves all the company’s vision, mission, goals, objectives
and core values for achieving the organisation long term goals. This model helps to reach your
goals and objectives with full planning and making clear each step for more future success. It has
five steps which are:

 Writing the mission statement with the planning team so that mission planning can be
done the mission is to be clear to be understand by all members of the company.
 Planning for setting goals which are for long term for more profits and increasing
competitive advantages of the company (Mobtaker, and et.al., 2018).
 Outlining the plans and strategies that helps in reaching those goals and objectives for
achieving future goals.
 Crating action plan by putting strategies practically in the work with full planning so so
that motivation can be maintained in the teams.
 Lastly by monitoring the actions for checking the accuracy of the work.
Strategic management plan
Strategic plan Tactical plan
They are the long term strategic plan and has long term
impact on the company.
They are the short term plans and goals which helps in
achieving the strategic plan (Sumpradit, and et.al.,
2021).
The company develop strategy plan for achieving future
goals like expansion of firm, increasing competitive
advantages of firm, or increasing productivity of the
firm, increasing sales and revenue by investing
diversifying etc.
The company break its big goals into small goals for
achieving the overall goals. The tactical strategy focus
on short term goals and objectives for achieving overall
goals of a firm. They are the objectives of day to day
working of the company, and assigning duties or
responsibility in between the staff and changing them on
monthly basis etc.
Strategic objectives of this is to seeing a big picture of a
firm, they are the objectives of how the company will
achieve its vision and mission , and what kind of staff
and activities required to achieve those objectives. The
strategic objectives of Hyatt hotel is to increase its
profits and growth of its company through effective
working or its staff and coordinating each functional
areas of each branch of this hotel.
Tactical plan is set up for achieving strategic plan
efficiently and they focus on company’s missions,
visions, goals etc and carefully designing short term
goals for achieving them. This hotel is assigning
monthly work to its staff for checking their accuracy and
providing discounts and other facilities for few days and
months for attracting more number of customers.
Valid strategic directions, objectives and tactical actions for a hospitality organisation
 The Hyatt hotel should carefully plans its strategies by analysing all the factors internal
and external with its expert team with help of SWOT analysis in which company strength

and weaknesses can be found and external environment with PESTEL analysis so that
every factors that can affects it operation can be studied.
 This hotel should plans its objective with pre planned strategies and goals with long term
and sustainable growth.
 The company should focus on its tactical actions like short term goals so that the long
term goals can be accomplished with full efficiency.
 All the strategies and decisions are done with special knowledge and with experienced
person who has all the knowledge like the CEO or managers of the company for accurate
forecasting of futures.
CONCLUSION
From the above report it has been concluded that business strategies are important in every
field of business and without planning of long term goals a company cannot be successful in
future. The company to know its internal strength and weaknesses uses SWOT analysis so that
all the weaknesses and threats can be replaced and with PESTEL all the outside factors can be
studied for planning future strategies. Further, it is also concluded that the companies uses
various models and theories for studying the market conditions and plan strategies by
researching the market for knowing all the competition prevailing in the market. The company
also uses porter five forces for knowing its market conditions and competition of new market and
new substitutes etc. It also concluded that strategic planning required various steps which are
needed for its success full operation and it involves all the tactical and tangible strategies needed
to achieve the goals.

REFERENCES
Books and journals
Rabetino, and et.al., 2021. A (re) view of the philosophical foundations of strategic
management. International Journal of Management Reviews, 23(2), pp.151-190.
Kumar, and et.al., 2021. What do we know about business strategy and environmental research
Insights from Business Strategy and the Environment. Business Strategy and the
Environment, 30(8), pp.3454-3469.
Chaouk, M., Pagliari, R. and Moxon, R., 2020. The impact of national macro-environment
exogenous variables on airport efficiency. Journal of Air Transport Management, 82,
p.101740.
Istan, M. and Fahlevi, M., 2020. The Effect of External and Internal Factors on Financial
Performance of Islamic Banking. Jurnal Ekonomi & Studi Pembangunan, 21(1), pp.137-
145.
Ahsan, M.M., 2020. Strategic decisions on urban built environment to pandemics in Turkey:
Lessons from COVID-19. Journal of Urban Management, 9(3), pp.281-285.
Teoli, D., Sanvictores, T. and An, J., 2019. SWOT analysis.
Abdullah, and et.al., 2022. Big Data in Criteria Selection and Identification in Managing Flood
Disaster Events Based on Macro Domain PESTEL Analysis: Case Study of Malaysia
Adaptation Index. Big Data and Cognitive Computing, 6(1), p.25.
Salim, and et.al., 2019. A systematic literature review of internal capabilities for enhancing eco-
innovation performance of manufacturing firms. Journal of cleaner production, 209,
pp.1445-1460.
Chmielewska, and et.al., 2022. Evaluating Organizational Performance of Public Hospitals using
the McKinsey 7-S Framework. BMC health services research, 22(1), pp.1-12.
Isabelle, and et.al., 2020. Is Porter's Five Forces Framework Still Relevant? A study of the
capital/labour intensity continuum via mining and IT industries. Technology Innovation
Management Review, 10(6).
Bulturbayevich, M.B., 2021. Development Of Innovative Activities Of Enterprises On The Basis
Of Vertical Integration Processes. Turkish Journal of Computer and Mathematics
Education (TURCOMAT), 12(10), pp.5020-5031.
1