Hospitality Strategy and Strategic Analysis of Meliá Hotels Report

This report provides a comprehensive strategic analysis of Meliá Hotels International. It begins with an introduction to the hospitality industry and the chosen organization, Meliá Hotels. The main body of the report is structured around key tasks. Task 1 applies the PESTLE framework to analyze the impact of the macro-environment on Meliá's strategies, considering political, economic, social, technological, environmental, and legal factors. Task 2 focuses on identifying Meliá's internal environment and capacities using SWOT and VRIO analyses, highlighting strengths, weaknesses, opportunities, threats, valuable, rare, inimitable, and organized resources. Task 3 applies Porter's Five Forces model to assess the competitive landscape and identify Meliá's competitive advantages within the market. Finally, Task 4 utilizes the Ansoff matrix for strategic planning within the hospitality industry, exploring growth strategies. The report concludes with a summary of the findings and references.

Hospitality Business
Strategy

Table of Contents
INTRODUCTION......................................................................................................................3
MAIN BODY.............................................................................................................................3
TASK1.......................................................................................................................................3
P1 Applying appropriate frameworks, analyse the impact and influence of the macro
environment on a given hospitality organisation and its strategies........................................3
TASK2.......................................................................................................................................5
P2 Identification of internal environment and capacities of organisation by the use of
SWOT and VRIO analysis.....................................................................................................5
TASK3.......................................................................................................................................6
P3 Application of porter's five forces model to identify the competitive advantage within
market.....................................................................................................................................6
TASK4.......................................................................................................................................7
P4 Using ANSOFF matrix for proper strategic planning within hospitality industry...........8
CONCLUSION..........................................................................................................................9
REFERENCES...........................................................................................................................9
Books and journals.................................................................................................................9

INTRODUCTION
Tourism Industry is developing continuously that become an important part of
hospitality organisations and industry. Because it provides different opportunities to
hospitality industry where they can use these customers for increasing their revenues as well
as operate at global level. Hospitality firm can be defined as that place where an individual
can stay by paying a rental amount for some period of time when he visits a place different
from its origin (Lipitakis and Phillips, 2016). In this report, The Chosen organisation will be
Meliá Hotel International. It is a Spanish Hotel chain which was founded by Gabriel Escarrer
Juliá in 1956. Hotel is operating with current account of 374 hotels in 40 countries and on
four continents. In the beginning of this report there will be description about the Macro
environment of the organisation by the use of pestle analysis and formation of a proper
strategy. There will also discussion about the internal environment by using the spot
framework and VRIO framework. In the middle of the report there is discussion about the
porters five Force model and the competitive forces which can be used by the organisation.
The end of the report is consisting of using a proper theory for strategic formation where
organisation can get maximum competitive advantage (Hua, 2016)
MAIN BODY
TASK1
P1 Applying appropriate frameworks, analyse the impact and influence of the macro
environment on a given hospitality organisation and its strategies
MELIÁ HOTEL INTERNATIONA is a huge Hotel chain within the Global world
which makes it a different and important factor within the hospitality industry. There are
various kinds of external factors which have their great impact on hospitality. This hotel is
also trading within this industry it is important for the hotel to analyse its external
environment and reduce their negative impact on the performance of different business
activities (eritelli and Schegg, 2016). In context of MELIÁ HOTEL INTERNATIONA, it can
use pestle analysis which will help in identification of political social economical technical
environmental and legal factors which have direct impact on business activities for and
hospitality industry.
Pestle analysis of MELIÁ HOTEL INTERNATIONA

This analysis is that Framework which is used by this organisation to clearly identify
its external environment and make decisions related to that environment for getting maximum
advantage within competitive market.
Political: political factors are those which are related to rules and regulation formed
by the government of the nation where the organisation is currently working and performing
its different activities. In context of MELIÁ HOTEL INTERNATIONAL, it is performing its
operation at a global level. Current time terrorism is a major political issue within whole
globe where it has negative impacts on the business of Hotel (Bharwani and Mathews, 2016).
Because of terrorism various tourism destinations are getting destroyed as well as tourist have
also fear of unwanted attack by terrorist. This Acting negatively on the hotel as they have to
make more security arrangement which also in cost as well as interest of tourist is also losing
because of fear from terrorist.
Economic factors: economic factors include those factors which are related to
economy where the business is going to start its business are currently operating. this hotel is
operating its business at global level so it has to consider all the factors within the economy
of different nations. it have both positive and negative impact on the business because in
some Areas where there are developing economy the growth rate of these economy is are
higher which help business in growing as well as expanding their market. Impact of this
economic factor on this hotel is that, there is some developed economy like USA, Russia
where the economic growth is very low and it is impossible for business to operate because of
regular loss and decline in revenue (Bowie, Buttle, Brookes and Mariussen, 2016).
Social factor: include those factors directly associated with social thinking mentality
culture behaviour of individuals within the society and area where the organisation is
operating. In Current situation MELIÁ HOTEL INTERNATIONAL, it is operating at global
level and has to deal with all the social factors related to different economy. In the current
business environment there are continuous changes within the tourism and travel industry
where the current trend is focuses on increased tourism and travel activities. This is in favour
of hotel where it can increase its revenue as well as improve its infrastructure to attract large
number of customers and use social factor as a competitive advantage (Chan and Hsu, 2016).
Technological factor: it includes those factors which are related to technological
changes within the area and innovation within the area where the organisation is working
currently. In context of MELIÁ HOTEL INTERNATIONAL, petrol operating in the

environment where are there is continuous changes in technology which is used by different
hospitality organisation. This also impacting positively on the organisation as it is now using
the online booking system as well as self-checkout in check in system which facilitate easy
and convenience to customers as well as increased their satisfaction where they can now use
online booking for preserving their rooms. Impact positively in the revenue of the
organisation as it can now expand its business to further areas where it can use online
booking system to reserve the rooms of different customers from different area of the world.
Environmental factors: include factors like climate change pollution geographical
location and many more things. It is most important part of any hospitality organisation this is
because geographical location helps the organisation in making their separate image within
the market. In context of MELIÁ HOTEL INTERNATIONAL, it is operating at impressive
geographical locations where it can easily attract customers because of wide availability of
tourism and travel destination regarding these areas. Organisation always chooses a proper
climate as well as environment around the business where it can easily attract the customer
by the natural beauty (Jones, Hillier and Comfort, 2016).
Legal factors: it include the factors which are related to rules regulations and policy
formed by the different governments in legal authorities of the Nations organisation is
working.in context of hotel there are various rules and regulations which have to be this will
help organisation in reducing its legal this will help organisation in reducing its legal liability
as well as increasing the brand image within the environment where it is currently. This will
also help business in formulating different policies where it can save the interest of consumer
as well as itself (Katou, 2016).
After critically evaluation of pestle analysis for this hotel it can be seen that there are
various factors which have both positive and negative impact on the business it must be
consider all the factors in an effective way for achieving the business objectives and making
decisions regarding different policies and procedures.
TASK2
P2 Identification of internal environment and capacities of organisation by the use of SWOT
and VRIO analysis
For succeeding in the business operation and getting the maximum competitive
advantage by formulating different decision making policies and strategies it is important for

hospitality organisation to identify its internal strength and micro environment. For this
scanning it can use SWOT and VRIO analysis which will help organisation in identifying its
internal capabilities and making decisions according to this.
SWOT analysis of MELIÁ HOTEL INTERNATIONAL
SWOT analysis can be defined as and Framework which is used by this hotel to
identify its internal environment. It includes strength, weakness, opportunities and threats of
the organisation which will help in working and gaining maximum advantage.
STRENGTH WEAKNESS
Global operation: The major strength of this
hotel is that it is operating at global level; this
will help MELIÁ HOTEL INTERNATIONAL
in managing its revenue as well as losses by
adjusting them to each branch of hotel. It will
also help in increasing its revenue has larger
organisation get the benefit of economy of scale
(Kim, Lee and Fairhurst, 2017).
Continuous improvement: It is also one of
strength of this hotel as it operates at global
level where it always uses innovative methods
and improvement within the functioning of the
organisation. Will help it in decreasing the
negative impact and increasing positive
outcomes of every operation within the
management and functioning of organisation.
Communication problem: Hotel is
operating at global level but it is important
for it to maintain a proper communication.
This communication is lacking in this
hotel because they have loose supply chain
management which impact negatively on
the communication between different
hotels of different areas.
Declining revenue: revenue of the hotel is
also continuously decreasing because of
increased competition as well as there are
various other branches which are not
performing inadequate min and that
impact negatively on the overall revenue
of the hotel.
OPPORTUNITIES THREATS
Train staff: Major opportunity in front of hotel
that it can train its staff where they can perform
different activities as well as complex task
within the organisation when there is need of
that.it will also improve the productivity as well
as impact on profit of the organisation in
positive manner.
Increased competition: There is
continuous improvement within the hotel
industry because of increasing market and
profitability of different forms which
impacting as a thread for the organisation
within the market (Kuo, Chen and Tseng,
2017).

Joint ventures and tie up: Hotel is suffering
from low supply chain management where it
can be used different types and joint ventures
with some other branches or small suppliers for
increasing its value and building a proper
supply chain management.
Covid-19: It is a pandemic disease which
also causing negative impact on the
performance of different hospitality
industry because of restrictions from the
government. Covid-19 damaged world
economy where hospitality industry has
huge impact of this because of closure in
operations at complete level.
VRIO analysis of MELIÁ HOTEL INTERNATIONAL
Valuable: valuable can be defined as those resources which are important part of the
organisation and help organisation in making them unique where it can work for
specialisation in these resources. In context of hotel, there are four valuable resources which
are investor, employees, supply chain and technology (Li and Singal, 2019).
Rareness: it includes those resources which are there as well as valuable for the
organisation. Organisation must keep these resources and use them in an effective manner. In
context of MELIÁ HOTEL INTERNATIONAL, the rarest resources are investor’s
employees and technology of the organisation this is because they are not easily available
within the market for the competitors to grab them (Martínez-Pérez, García-Villaverde and
Elche, 2016).
Imitable: these are resources which are valuable as well as rear for the organisation
and now they cannot be used by the competition of the organisation because of their
imitability.in context of MELIÁ HOTEL INTERNATIONAL employees and technology are
the two resources which cannot be imitated by its competitor because organisation invest
amount on its employees for their training and development. Company also invest huge
amount of technology which is impossible for other competition to incur in hospitality
industry (Peters and Kallmuenzer , 2018).
Organised: Employees are the well organised part of the hotel this is because
company always believes in effective staff and their management where it can increase its
worthiness and productivity within the competitive market. This will provide a competitive

advantage to the organisation within the hospitality industry (Petronella , Swart and Anne
Taylor, 2018).
It can be identified from the above mentioned VRIO analysis and SWOT analysis that
there are various factors which impact the organisation. This also improves the global
strategy of the organisation as well as performs its function in an effective manner.
TASK3
P3 Application of porter's five forces model to identify the competitive advantage within
market
Porter’s five force model
Porter’s five force model is that analysis which can be used by the organisation to get the
maximum advantage within the market by following its different these factors are mentioned
below:
Power of supplier: the MELIÁ HOTEL INTERNATIONAL is operating in
hospitality industry where suppliers are available in large number so this factor is moderate
for the organisation because there are various kinds of suppliers which can be used by the
organisation (Prud’homme and Raymond, 2016). This increase the power of organisation as it
can now bargain from its suppliers and gain maximum competitive advantage by serving its
consumer with less cost.
Threat of new entrants: hospitality industry is that industry where there is
requirement of shoes capital for a new comer within this industry. This is because there is
huge investment on infrastructure and development of this makes it impossible for new
entrant to open its business without a huge investment. This also become a competitive
advantage and a low threatening factor to MELIÁ HOTEL INTERNATIONAL (Rather and
Sharma, J.Y.O.T.I., 2016)
Power of customer: power of customer is also moderate factor for the organisation
this is because there are a large number of customers within the tourism and travel. The
customers are increasing day by day because of increasing trend toward tourism and travel.
This can become a competitive advantage for hospitality industry as the can now improve
their services and attract more and more customer towards the organisation where the
bargaining power of customer is also low because of high availability of customer within a

specific (Scott, 2016). This is moderate for the MELIÁ HOTEL INTERNATIONAL because
there are a large number of organisation which are trading within the industry which also
increase a little bill amount of bargaining power to customer.
Competitive rivalry: hospitality industry off white industry where there are various
organisations which are operating at global level. This factor is highly respected which
reduce the competitive advantage to the organisation because there are various kind groups of
hospitality chains which are operating at global level as well as with higher investment and
better infrastructure then MELIÁ HOTEL INTERNATIONAL. This can impact negatively
on business performance so organtional have to keep eye on it and manage its faction
accordingly by eliminating direct face off (Sheresheva and Kopiski , 2016).
Threats of substitute product: in hospitality industry every organisation is selling
some different products which have different kind of facilities and infrastructure. For this
MELIÁ HOTEL INTERNATIONAL have to make a proper plan where it can use innovative
products to increase the competition market where it is reading as there is no close substitute
of the organisation product so it can easily save itself from a direct competition and increase
the awareness about their product for giving the maximum shares within the market.
TASK4
P4 Using ANSOFF matrix for proper strategic planning within hospitality industry
Strategic planning can be defined as in set of activity which is used by the
organisation to get its objectives and goals in a specific time where it can use its resources in
an appropriate way by reducing the cost (Yoon, Jang and Lee, 2016). MELIÁ HOTEL
INTERNATIONAL hotel is also operating at global level so it is important for this to use a
proper strategic planning with in its functioning for this it use ANSOFF matrix where it
divide it's market according to it. There are four type of strategy which can be adopted by the
organisation for getting the maximum advantage.
ANSOFF matrix:
It is a Framework which is used by the organisation to formulate a proper strategy and
use it in a target market where it can increase the sale of the products and services has won as

increase its market share for generating profit and retaining itself for a longer period of time.
It includes four types of strategies which are discussed below.
Market penetration: it includes the strategy where organisation has to increase and
improve its existing product within the existing market where it is trading. In the context of
MELIÁ HOTEL INTERNATIONAL hotel, it is operating in a global market where it is
continuously improving its products and services in existing markets for increasing the
business and satisfaction of customer.it can also use different type of business advertisements
which will help in promotion of these services and attractive number of customer to word the
existing infrastructure (Sowanber, Ramkissoon and Mavondo, 2018).
Market development: district is directly related to improvement of existing product
in new market. Here organisation can launch its existing product within the new market.
MELIÁ HOTEL INTERNATIONAL hotel is operating within different market and it is
easier for organisation to operate in new market with existing products because of good
investors as well as trained staff. There are various kinds of methods which can be used in
market development like identification of market analysis of market situation and improving
the condition for launching a new product.
Product development: this is directly related to developing a new product within the
existing market. This is also risk strategy because development of new product involves
various kinds of cost as well as capital. In context of MELIÁ HOTEL INTERNATIONAL
hotel, forgetting this strategy organisation have to develop new and innovative services
within its existing infrastructure. It can use facilities like bar, restaurant, and other club
membership facilities which will help organisation in developing a new service within its
existing market (Varelas and Georgopoulos, 2017)
.
Diversification: diversification is related to launching a new product within a new market.
This is the most risky strategy for the MELIÁ HOTEL INTERNATIONAL. This is because
it involve confuse investment on development of a new product as well as high cost of
analysis for identification of new market where the organisation want to launch its new
product. A small mistake can easily feel the whole program of the MELIÁ HOTEL
INTERNATIONAL and also make it difficult for the organisation to recover because of huge
capital investment and failure in operation.so this strategy should not be adopted by the

organisation until and unless it is sure about the market as well as its new product which it is
going to launch in the new market (Vlachos, 2016).
from the above it can be identified that MELIÁ HOTEL INTERNATIONAL hotel is
operating at a good profit where it can use the strategy of expansion and growth so here
market development strategies are useful for this organisation because they are operating at
good profit and it is easier for organisation to survive within the dynamic environment while
launching existing products and services in new markets. Also help hotel in increasing its
revenue.
CONCLUSION
It can be concluded from the above mentioned report that there are various
opportunities to the hospitality industry in market. Grabbing the opportunity and making the
organisation favourable in any situation it is important for MELIÁ HOTEL
INTERNATIONAL clearly identify its macro and micro environment with the use of
appropriate framework. It is also identified that porter's five force model can be used to
identify different factors which have their impact on performance of the organisation and will
help in identification of competitive advantage like power of supplier power of customer. It is
also identify that organisation can use a proper business strategy in strategic planning by the
use of ANSOFF matrix where it can develop its market and increase revenue with the help of
it.

REFERENCES
Books and journals
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strategy. International Journal of Contemporary Hospitality Management.
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industry. Worldwide Hospitality and Tourism Themes.
Bowie, D., Buttle, F., Brookes, M. and Mariussen, A., 2016. Hospitality marketing. Taylor &
Francis.
Chan, E.S. and Hsu, C.H., 2016. Environmental management research in
hospitality. International Journal of Contemporary Hospitality Management.
Hua, N., 2016. E-commerce performance in hospitality and tourism. International Journal of
Contemporary Hospitality Management.
Jones, P., Hillier, D. and Comfort, D., 2016. Sustainability in the hospitality
industry. International Journal of Contemporary Hospitality Management, 28(1),
pp.36-67.
Katou, A.A., 2016. Human resource management and performance in the hospitality industry:
methodological issues. In Project Management: Concepts, Methodologies, Tools,
and Applications (pp. 1980-1999). IGI Global.
Kim, S.H., Lee, K. and Fairhurst, A., 2017. The review of “green” research in hospitality,
2000-2014. International Journal of Contemporary Hospitality Management.
Kuo, C.M., Chen, L.C. and Tseng, C.Y., 2017. Investigating an innovative service with
hospitality robots. International Journal of Contemporary Hospitality Management.
Li, Y. and Singal, M., 2019. Capital structure in the hospitality industry: The role of the asset-
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comparative study of the UK and Greece. Technology Analysis & Strategic
Management, 28(3), pp.266-289.
Martínez-Pérez, Á., García-Villaverde, P.M. and Elche, D., 2016. The mediating effect of
ambidextrous knowledge strategy between social capital and innovation of cultural
tourism clusters firms. International Journal of Contemporary Hospitality
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Peters, M. and Kallmuenzer, A., 2018. Entrepreneurial orientation in family firms: The case
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