Ritz-Carlton UK: Strategic Analysis of the Global Business Environment

This report provides a comprehensive analysis of the global business environment and its impact on Ritz-Carlton UK. It begins by examining macro environmental factors through a PESTLE analysis, covering political, economic, social, technological, legal, and environmental influences. The report then delves into the internal environment and capabilities of Ritz-Carlton UK, utilizing frameworks like VRIO and value chain analysis to assess resources and activities. Porter's Five Forces model is applied to understand the competitive landscape and identify opportunities for competitive advantage. Furthermore, the report explores various strategic planning theories and proposes a strategic management plan with defined priorities and objectives for Ritz-Carlton UK, aiming to enhance its market position and ensure future success. The analysis highlights the importance of adapting to external factors and leveraging internal strengths to maintain a competitive edge in the hospitality industry. Desklib offers a wealth of similar resources for students.

UNIT 18 GLOBAL
BUSINESS ENVIRONMENT

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
P1 Analysing impact and influence of macro environmental factors on RitzCarlton UK hotel.3
M1, D1 Critically analysing hospitality macro environment......................................................5
P2 Analysing internal environment and capabilities of a RitzUK using appropriate
frameworks..................................................................................................................................6
SWOT ANALYSIS.....................................................................................................................9
P3 Applying porter five forces for hospitality organization.....................................................10
M3 Devising proper strategies to improve competitive edge and market position of Ritz
Carlton.......................................................................................................................................12
P4 Applying range of theories for strategic planning in Ritz Carlton-UK...............................13
M4 Producing strategic management plan that has priorities and objectives...........................14
CONCLUSION..............................................................................................................................16
REFERENCES..............................................................................................................................18

INTRODUCTION
Hospitality sector is broad category that includes all kinds of services such as food,
lodging, drink services and much more that are provided by various business firms. Also, present
report is based on Ritz is very well-known for providing premium class of services to all its
guests in UK and other parts of the world. Moreover, the study will identify impact of various
macro environmental factors on the operations of Ritz business along with influence of these
factors in taking various strategic business decisions in the future.
Also, the report will identify the impact of internal environment through applying various
models and concepts. Thus, through application of these models the firm will be able to identify
the weakness and find out ways to overcome it on timely manner. Furthermore, porter five
forces model will also be applied so that competitive advantage to Ritz could be derived. Lastly,
range of models and concepts for better future strategic planning and success will also be
covered under this report in detail.
MAIN BODY.
P1 Analysing impact and influence of macro environmental factors on Ritz UK
It is very important for nay organization to closely analyse the impact of external
environment so that better policies and strategies might be developed in the future. Also, external
environment of any company is affected by many factors which can be explained through
applying the PESTLE model that is as follows:
Political factors: There are the factors that affects the business operations on large scale.
Also, there are various factors such as political instability, trade barriers, certain restrictions that
are imposed by the country due to the involvement of political party in the country (Aladag and
et.al., 2020). Moreover, in Ritz it can be said that it is very important for company to consider
all the political matter while expanding into new regions so that chances of restrictions might be
minimized. Thus, it needs to consider all the political factors such as changing policies, various
taxes, corruptions, and existence of various pressure groups among the target markets while
making any strategic planning for the business.
Economic factors: Factors such as exchange rate, interest rates, inflation, market
conditions also impact the working of the firm. Moreover, well-developed infrastructure
facilities in smooth business operations and increase the growth of the firm (Roma, Panniello and

Nigro, 2019). Also, after pandemic it can be said that there is high unemployment within the
country that might turn out to be positive factor for the firm as it would allow in hiring more
muber of workers within the UK at lower wage rates thus saving cost of the company.
However, if labour market conditions are not good in any country than there are chances that the
firm would not be able to operate smoothly in the target market.
Social factors: Culture in any country is made up of various culture, traditions, customs,
beliefs etc. and hence it is very essential for Ritzto choose and target the right market segment so
that greater revenues are generated for the future. Moreover, it is very important for the quoted
firm to understand the people attitude towards various services so that certain changes could be
than made accordingly. Also, to align the current market practices with overall business goals
Ritz need to change current market strategies so that better roles and responsibilities might be
assigned to all members that will further help in ensuring efficiency of the firm. Also, adopting
this type of method would help the firm to create goodwill of the firm and increase brand loyalty
of its customers.
Technological factors: With continuous improvement in upcoming technologies, it is
crucial for Ritzhotel to make certain changes in its working so that it might sustain in the market
for longer duration and maintain competitive advantage (Cerchione and Bansal, 2020).
Moreover, use of social media platforms by Ritzto promote various products and services is very
essential so that more people are attracted towards the hotel services than in comparison to
others. Furthermore, through discovering new suppliers, technology and creativity at the
workplace Ritz UK would be able create positive impact and thus would be able to introduce
new growth strategies in smooth manner. However, using older and outdated technologies would
create negative impact in form of losses and wastage of resources for the quoted firm.
Legal factors: These factors have major impact on the firm as it is necessary for any firm
to follow and comply with all legal rules so that there is no interference of the third party in the
future. Also, Ritz UK hotel is very well-known for all its services that are offered at its hotels.
Therefore, it is very important that all legal laws followed in any particular country are strictly
abided by firm at workplace and among its employees. Also, this factor would be positive only
when all the new undertakings by the firm are taken in coordination and support of government
of the country otherwise it might create problem for the firm to undertake certain activities for
growth of the company.

Environmental factor: this is the last factor in the PESTLE model and in the current era
where most of the people are concern about the health and the environmental activities in the
country it is crucial that Ritz hotel ensures that all its workers are conducting the activities
according to the environmental laws and rules. Moreover, to create positive impact on the society
it should introduce new methods to save the additional resources that are involved in undertaking
of any activity. Moreover, methods such as plantation of tress around the hotels areas, use of
reusable cups and utensils, less wastage of water etc. would help boost the company revenues’ in
against some of the biggest competitors and also create the image of social responsible firm in
front of others. Further, various campaigns to create awareness among people about the new
environmental concerns could also be another method to improve the brand image of company in
long run.
M1, D1 Critically analysing hospitality macro environment.
For any company to operate successfully in different markets it is important that external
environment is analysed carefully so that various strength and weakness of firm existing within
the workplace is identified properly. Also, macro environment would allow Ritz hotel to devise
strategies that is essential for success of the business. Moreover, it is very important that top
management staff of Ritz conducts careful analysis and market research of its various
competitors so that their current policies and ways of overcoming certain challenges is identified
that might be similarly applied within the organisation (Erbas, 2021). However, to provide clear
strategic direction to all employees of the organization it is important that various political, social
and economic factors that might impact the business are identified before only so that
appropriate planning might be taken on timely manner. Also, through applying Ans-off matrix
quoted firm would be able to develop proper marketing strategy so that maximum output might
be generated using lesser amount of resources. Thus, all the decisions and actions need to be
made in accordance with all external factors that are affecting the business indirectly.
P2 Analysing internal environment and capabilities of a Ritz UK using appropriate frameworks
Internal surroundings and capabilities in organization is being composed as the
organization internal resources as assets, skills of employees, knowledge’s and various
equipment’s being used by the hospitality company. Ritz UK operating as a luxury resort and
hotel in the country mainly focuses for the iconic hotel and resort build with elegance and suits
which are impressive for serving luxury to guests.

VIRO analysis of Ritz
Resources Valuable Rare Imitable Organised
Human resources
( staffs )
yes No yes Not organised
Financial
resource
Yes Yes No Yes
Marketing yes no yes moderate
Brand image/
reputation
yes yes no yes
Physical
resources
( equipment’s )
yes yes no yes
As per the above table, internal analysis, Ritz has valuable staff personnel’s working and
serving various guest arriving at the hotel, these staff personnel are imitable and not organised
for performing various tasks being assigned at hotel. As skilled and various other personnel’s
working in the hospitality are imitable and acquired with similar skills for wiring in the hotel for
serving and providing services to the guest arriving at hotel. But the approach in marketing and
sales strategy used is not valuable and rare as digitalizing and various other options given for
booking the hotel is used by various competitors in hospitality industry, the strategy used for
permeating and marketing is imitable and used by other companies also (Huang and et.al., 2019).
So, the company must spend more investment in order to engage profitable and competitive
advantage for the company in order to sustain in the dynamic environment. Also, the brand
image and companies using other physical resources are strong and valuable, also rare an
organised for serving consumer at hotel.
Value chain analysis for the Ritz: This analysis is used by the company in order to
analyse the internal factors which is mainly divided into primary and secondary parts. In primary
the main activities in which the company is operating will be affecting also in secondary the
order related activities as the infrastructures of the firm the support activities will be specified by

this framework. Various services is being offered by the Ritz UK as of the menus for serving the
dinner, various accommodation services is being provided by the company, clothing services,
help desk, wellness rooms, bars, gathering rooms. This analysis helps in identifying various
internal supporting resources and activities for creating products and providing various services
to guest arriving at hotel. Value chain mainly helps in defining about the changing several
internal resources for providing better services for generating outputs. further using this model
aid in identifying the hotel capabilities and organisational structure in supporting and providing
better services to consumers.
PRIMARY ACTIVITIES
Inbound logistics: By keeping the high position of business, the Ritz UK hotel is serving
many consumers with mainly accommodation services, best food drinks and design, also unique
techniques is being adopted by the Ritz hotel in order to ensures proper caring of consumer and
satisfying with guest with ultimate comfort services. The company is making direct relations
with the suppliers as for handling services and serving to large guest arriving at hotel.
Operations: operations are being performed at highest value by the company in order to
serve consumers with comfort and relaxed atmospheres. Ritz is mainly providing various
services for fulfilling various unexpressed wishes for guest being arrived at hotel. This helps in
establishing strong capability by satisfying consumers with the highest level.
Outbound logistics: At this point the Ritz hotel is serving consumers with various
tangible and intangible products by the company in order to provide comfortable an affordable
service to consumer. This provides benefits to hotel by grasping large target market with
providing affordable accommodation services to the consumers in dynamic market.
Marketing and sales: Marketing and promotional strategies used by the company is by
digitalizing its services on website for offering and direct booking of rooms and dining facilities.
As smaller lobbies are being designed by the company in order to offer special service to guest
for offering various luxury experiences. The Ritzhotel is using different marketing aspects as
with applying different marketing stages for promoting services and hotel sales taking booking
by establishing website and coordinating with sakes team and travel agencies for promoting the
company in proving best travel services
Various services: as the company is operating with the culture of belongingness, it ads in
servicing employees with staying services to various guests (Baltag, Bezhanishvili and

Fernández González, 2019). Also, all services to firm the consumers are concerned instantly by
the reception desk staff as this will provide better opportunities for building future data base for
serving consumers and guest arriving at hotel for acquiring various services.
SUPPORT ACTIVITIES
Infrastructure of firm: The Ritz hotel UK is mainly operating in many countries
globally. The main goal for the company is to serve the guests with highest caring an giving
comfort. The company is offering high quality of services to individuals. As the company is
operating with meeting affordable services by giving satisfactions to various consumers. The
hotel is serving luxury and privates bath in each rooms. The main factors which re primarily
being focused by the company is quality luxury services by maintaining affordability,
cleanliness, around the world.
Human resource management: For delivering the high-quality services to satisfy
various consumers, the hotel provides training to various employees mainly to front desk staff
personnel in order to establish first impression on guests. The HR manager of the company offers
to choose right skills and ability employees for providing services as on the job to various guests
arriving at the hotel.
Technology: Various technologies are being used by Ritz UK hotel and resorts for
providing consumers maximum satisfaction by instantly serving according to needs and wants.
As by building website online aids in providing opportunity to various guests for booking rooms
directly by using Internet from anywhere
Procurement: The Ritz hotel is recognised as the premium brand being positioned
internationally as a global brand of the company. The hospitality company mainly assure with
serving high quality of accommodation services for providing wonderful experience to guest
arriving at hotel. The suppliers of the hotel company is selected after reviewing unethical
practices being followed by them and then selected in order to supply good and products to Ritz
hotel. Other faculties as of supporting staff and appointing for purchasing various necessary
resources for providing best services the guest arriving at hotel. As of purchasing various
products as for maintaining accommodation services with providing leisures quality standards
and other.
Further, by using the McKinsey framework supports in defining strengths and weakness of the
hotel industry after assessing its strategy structure, its shared values, staffs, skills, and systems.

Strategy: The company is using word of mouth promotional strategy. It creates the value
chain of hotels and resorts being operated as Ritz hotel. Also making social media websites for
attracting consumers and encouraging bookings. Attracting consumers with providing best
dinning facility with impressive suites and implacable guest servicing.
System: Company in operating with the wide range of systems as for consumer’s
reservation systems, performance evaluation system, employee’s selection systems also various
data base systems such as CRM in order to record the guest preferences and services acquired by
guest.
Structure: The company is operating in the hierarchy and centralised structure where all
the decision is being handled by the top executive for operating the hotels at various level. With
high costing it impacts the target market of guest arriving at hotel. Suitable for premium
consumers for acquiring leisure services.
shared values: The company aids in building strong relationships with various
consumers for fulfilling various wishes and needs of guests (Liverpool-Tasie and et.al., 2020).
The company continuous seek innovate for improving the performance of company and aids in
creating safe surrounding.
SWOT ANALYSIS
STRENGTH
 Company is operating its business and
recognized globally as luxury hotels
serving leisure services.
 Providing high quality services with
impressive suites to all guest arriving at
hotel.
 Presence of hotel is in the right location
which helps in attracting large
consumers for experiencing luxury
accommodation services.
WEAKNESS
 With changing into the trends and
demand affects th company as each
culture ad individual belonging from
different culture requires different
luxury services.
 As the brand is recognized globally,
brand name is recognized as expensive
which hinders the middle-class
consumers for approaching and
experiencing services at hotel.
 Online negative ratings impact

company.
OPPORTUNITIES
 Opening new hotels as part of Ritz
hotel into the emerging countries and
developing markets.
 Investing into Asian potential market
provide opportunity to business.
 Organizing sponsored events also
improving and promoting security of
the hotel helps in tapping various
opportunities.
THREATS
 Increased competition impacts
company services, as main competitors
are Accor, starwod hotel, Hilton hotels.
 Increasing on the operating costs of
various process impact company
operations.
 Declining into the tourism industry
impact the company due to Brexit and
covid factors.
P3 Applying porter five forces for hospitality organization.
Porter five forces model is framework that helps in analysing overall competitive
environment so that strength and weakness of the firm is clearly defined. Thus, it helps in
identifying the industry structure so that better corporate strategy might be developed against
some powerful competitors. Moreover, through successfully applying this model quoted firm
would be able to enhance the long term profitability of the business. Furthermore, in case of Ritz
UK hotel it has successfully established its operations in UK through its best strategies and is
very well-known as known as one of the most famous hotels among large number of people.
Thus, below are the elements of porter that are described are as follows:
Competition in the industry: It is defined by total number of rivalry firms that are
already existing in UK market. For Ritz UK hotel, it can be said that firm has the ability to face
strong pressure from other rival firms due to its brand image in UK. However, if competitors of
Ritzare strategically diverse and are targeting in same market than it is major concern as it might
lower the total revenues for firm. Moreover, operating in UK hospitality industry, firms have
higher chances of leaving the industry anytime thus it has reduced overall competition from
small hotel units that operate on temporary basis due to lack of resources or lower revenues.

Threat of new entrants: It reflects total amount of risks that imposed threats on the
existing market players in UK. Also, for Ritzhotel threat of new entry is very low because
establishment of new hotel requires more amount of resources and investment. Moreover, threat
of new entrants might be reduced if new distribution channels are not available in UK market
(Ritz Carlton-Carlton Hotel Co Porter Five Forces Analysis, 2022).). However, this factor might
impose certain challenges on firm if the UK government and existing regulations provides full
support to new players who wish to work in the hospitality sector. Also, if this happens than Ritz
UK need to maintain strong customer base so that loyalty is maintained for longer time period.
Furthermore, quoted firm need to identify special attribute that new firms are bringing in their
hotels so that quoted firm devise better methods and strategies.
Threat of substitutes: When similar products or services are made available in the same
market than it is quite challenging for other firms to operate in market smoothly. Also, there are
various factors on basis of which Ritzhotel threat intensity could be identified (Demir, Díez-
Esteban and García-Gómez, 2019). One of them is related to price which means that if any hotel
is providing similar services in cheaper prices than Ritz UK there are higher chances that
customers might switch to that option. Moreover, another threat to Ritzmight be that other hotels
in UK are performing extraordinary well in shorter time period. However, it can be said that
though large number of substitutes are available in the market quoted firm would still stand apart
from all others because of its high brand value and personalized products that its offers to its
customers to create the best stay experience during the holiday.
Power of buyers: It is the ability of group of customers to drive the prices of the services
to the lowest that ultimately affects the business objectives of any firm. Also, having the
concentrated customer base would require Ritz to bring changes in prices of various services
offered within the hotel so that chances of survival within the hospitality industry are increased.
Moreover, customers having high market knowledge would also increase the bargaining power
of buyers that might create problems for Ritz hotel to cut down its costs wherever it is possible
(Tweneboah-Koduah, Anning-Dorson and Nyamekye, 2020). Moreover, to maintain higher
profitability of business it is important that industry stands more competitive in terms of
leadership and its services so that large number of customers are not able to influence and change
policies of the business easily. Thus, currently for Ritzhotel this factor is lowest as it is targeted

only to small section or group of people in UK society that are more focused on availing quality
services.
Power of suppliers: It is defined as how suppliers are affected by cost of inputs that are
being supplied by them. Also, in context of Ritz it can be said that this factor is very low as large
number of suppliers are available in UK that are ready to be associated with Ritzbecause of its
high brand value (Cabral and Jabbour, 2020). Moreover, suppliers in United Kingdom are aware
that switching costs are very low and hence associating with other brand would not be great
option for the supplier to earn extra. Although, quoted firm holds power over the suppliers to
remain competitive in the industry there are chances that some factors such as large number of
suppliers concentrated in one particular region might impose challenge to Ritz to pay more for
services and raw materials for conduct of various operational activities.
M3 Devising proper strategies to improve competitive edge and market position of Ritz Carlton.
To have leading market position in UK and other regions it is important for Ritzto
continuously develops strategies so that brand loyalty and better customer relationship
management is maintained (Alsubaihi and et.al., 2020). Moreover, firm should also invest more
in research and development so that new customer segments might be identified. Furthermore,
company should opt more for product diversification strategies so that competitive position is
more strengthen. Also, Ritz should focus on developing those strategies that enables continuous
innovation and creativity at the workplace. Moreover, it is only possible when collective ideas
are taken from all employees at the workplace so that it could strengthen firms position in UK
market. Also, the firm need to invest more on promotional and marketing strategies so that
greater revenues might be generated for the same. Furthermore, use of such promotional
techniques would allow quoted firm to identify new areas of growth opportunities by knowing
the needs of the customer closely so that certain changes might be done on time. Also, to
remain competitive it is (necessary) than Ritztakes the help of external party that would help in
gathering the data of market accurately and in most appropriate manner so that better strategic
decisions could be taken for the future (Ali and Anwar, 2021). Thus, through combining the
PESTLE framework along with porter five force analysis RitzUK would be able to determine the
future attractiveness of various projects that would be available to the firm as it conducts daily
operations.