Strategic Planning for Growth in the Hospitality Sector

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UNIT 21 SMALL BUSINESS
ENTERPRISE
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Contents
Introduction.......................................................................................................................................... 3
LO1...................................................................................................................................................... 4
1.1 Produce a profile of a selected small business (type, size, structure and objectives of the
chosen hospitality business) identifying its strengths and weaknesses............................................4
1.2 Carry out an analysis of the business using comparative measures of performance.................6
LO2...................................................................................................................................................... 8
2.1 Recommend with justification, appropriate actions to overcome the identified weaknesses in
the business..................................................................................................................................... 8
2.2 Analyze ways in which existing performance could be maintained and strengthened................9
2.3 Recommend with justification, new areas in which the business could be expanded..............10
LO3.................................................................................................................................................... 12
3.1 Produce an assessment of existing business objectives and plans.........................................12
3.2 Revise plans to incorporate appropriate changes.....................................................................13
3.3 Prepare an action plan to implement the changes....................................................................14
LO4.................................................................................................................................................... 18
4.1 Report on the impact of the proposed changes on the business and its personnel..................18
4.2 Plan how the changes will be managed in the business...........................................................20
4.3 Monitor improvement in the performance of the business over a given timescale...................21
Conclusion......................................................................................................................................... 22
References.........................................................................................................................................23
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Introduction
The research and statistical data in research and development department (R &D) for
small businesses it’s a great opportunity for small business enterprises. In 2018, from
5.7 million of businesses 99.8% of businesses are undergone in small and medium
business enterprises.After this revolution of globalization, people are turning back from
their jobs to their start-ups and for personal ventures adopted from small business
enterprises. This results in a successful e-commerce store and entrepreneur
freelancers. In London there is a high ratio of small business enterprises that leading
global market with profitable revenue and provides a good economy for the nation. In
hospitality sector of UK, standard figures show that there are 1058 small and medium
businesses and enterprises per 10,000 residents. In UK, the industries and companies
at broad sector works as in- service industries that consist of marketing, sales,
management, hospitality and tourism. Political and legal terms don’t affect the small
scale businesses at extreme level.
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LO1
1.1 Produce a profile of a selected small business (type, size, structure and
objectives of the chosen hospitality business) identifying its strengths and
weaknesses
Let’s take an example of ‘Secret Escape’ that runs as a small business enterprise in
hospitality sector of UK. Secret Escape is a leading organization in hospitality industry
that provides tour and travel packages with hand-picked hotels and holidays
destinations in UK. As a small industry in hospitality sector ‘Secret Escape’ provides
facilities to the customers at their tourist destinations with reasonable and affordable
prices with luxurious accommodations in hotels and travelling.
The Secret Escape enlarging their business in all over worldwide by offering affordable
prices in tour and travel packages. The Secret Escape organization has tie-up with
Lexus that provides the accommodation facilities to customers with a better experience
holding a various set ups of designs and collections as per the interest of customers.
Overview of Secret Escape
Secret Escape is derived from DMC Cruise Ltd. which deals in travel and tourism
sector in UK. The organization was established as small business enterprise in 2011.
The headquarters of secret escape is located in London, United Kingdom (UK). The
service provided by this organization is offering flash deals in travel and tour packages
for the customers with efficient deals. The number of employees working with the
organization is more then 400 and as it is a leading organization in hospitality sector
strength of employees is growing as per the demand.
In July 2015, the organization established their investors who invested $60 million from
Google ventures to expend the organization on a large scale. According to general
calculations of IBT, organization has joined 19 million members over worldwide and 1.4
million members to its portfolio.
The organizational platform allows the customers and members to book their plans and
packages at five star rating hotels, adventures islands, eco-grounds and tropical
beaches.
The operational structure of the company consists of travel agents, tour operators,
destination sites a guides.
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Mission and Vision
The mission of the Secret Escape covers the tour and travel packages provides to their
customers and members with luxurious facilities that are good enough to recommend
that offering the flash deals with affordable prices as per the interest of customers.
The vision of the Secret Escape is to provide enjoyable and stress-free experience to
the members with increasing sales in international businesses and gaining profitable
margins for the development of the organization.
Identification of Strength and Weakness of SBEs-
Strengths Weaknesses
 Good reputation in tourism and travel
sector of UK enterprises.
 It has strong portfolio with London and
East Europe with 5.6 million members
 Provides luxurious tour packages and
hotel services at flash deals
 Employee strength working in the
organization is more than 400 that
working over worldwide to provide
various services in hospitality sector.
 Physically trained employees and
loyalty with customer satisfaction
 Secret Escape is a leading
organization but non-
availability of resources at
peak time draws a bad
impression on customers
 Organization is low at
managerial capacity that
slowdowns the internal
processes.
 Lack in providing customer
services that reflects in bas
review and ratings.
 Tough competition from local
markets expending their
business with heavy offers.
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1.2 Carry out an analysis of the business using comparative measures of
performance.
The comparative measures of performance analysis for a business organization
defines the overall performance evaluation that are presented to acquire the goals and
objectives of the business for the growth of the organization from small scale to large
scale integration. The comparative analysis is the process of measuring the strength
and weakness of organizational processes that implicit on both small enterprises and
large industries. At the time of starting a project or a business, goals and objectives are
declared to be fulfilled in between the time limits and capital investment should be
recover with this axis in an organization.
Performance analysis approach for organization or a small business includes financial
and non-financial measures. These measures help in concluding the overall
performance that reports in-depth analysis of small scale enterprises. Financial
measure includes all turnovers, profits, market shares, accounts and margins in the
organization whereas non-financial measure involves services, customer support,
organizing strategies, flash deals, exploring markets, product delivery and employee
satisfaction.
For Secret Escape, the comparative measures for performance analysis includes all
these terms that are describes above. The hybrid mixture of both performance analysis
and organizational analysis helps in analyzing the strengths and weaknesses of the
organization in internal and external activities.
The comparative measures of performance-
 Customer satisfaction
 Operation Quality
 Employee’s motivation
Theoretical Framework-
Theoretical framework help in assessing support directions and develop the hypothesis
at discussion panel. This framework analysis approaches to evaluate the performance
on the basis of measured and optimized resources. Various approaches related to this
framework are system resource approach, goal and objective approach, competitive
value approach and marketing stakeholder approach. These approaches based on the
capability to meet with the organizational needs and planned targets. For small
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business enterprises theoretical framework assess the under stability, simplicity, and
internally focused.
Factors influences performance measuring of small business enterprises:
 Lack of human resources
 Managerial capacity
 Research approaches
 Tacit knowledge and consideration in formalization of processes
 Misapprehension in performance quantity
 Limited capital resources
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LO2
2.1 Recommend with justification, appropriate actions to overcome the identified
weaknesses in the business
There are some weaknesses related to the small business enterprises that limit the
boundaries of the organization. Secret Escape faces some limitations and weakness in
expending their business into international markets.
Assistance from government: For new and innovative start-ups and small business
government support in via funding and loan advisory services to extend the small
business. For small enterprises government provides Enterprise Finance Guarantee
schemes that provide loans at very interest in order to invest into new services.
External support from the government with proper investment will improve the growth
and development of small businesses.
Proper Planning: The concept of planning plays a vital role in establishing a
successful business in competitive market. The owner of small business enterprise for
ex. Secret Escape has to establish a plan to initiate their activities so that all
information should be shared in the execution of the performance. It will help in
reducing misunderstandings among the customer services and employees or staff of
the organization. Planning helps in reducing stress in the organization at peak time and
help in providing better quality to the customers that results in enlarging the business.
Activity Controlling: Activity controlling is a part of organizational structure that is
measured effectively to detect and identify the deficiency in the system. Activity
controlling involves decision-making capabilities in order deliver the services and
products to the customers and provide a feedback immediately. This phase processes
the customer reviews in further improvement that involves enhancement in work or
organizational processes. Controlling actions minimizes the extra use of resources and
increase the profit margin in small business enterprises.
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2.2 Analyze ways in which existing performance could be maintained and
strengthened.
The performance of an organization can be maintained and strengthened in various
ways. For Secret Escape Ltd. in hospitality sector the travel agencies will depends on
the environmental conditions and satisfaction level of customer. The ways by which
existing performance can be strengthened and maintained is:
 Satisfy customer expectation: For the owner of Secret Escape, it is necessary to
satisfy customer expectation that will enhance the image of industry in market. The
business enterprise should have to collect the feedback of each customer so that
required changes can be implemented in maintain a luxurious facilities in travel
tourism. It will attract members to the industry to buy various tours and travel
packages to the customers.
 Planning and decision making: Generally small enterprises need best planning
and decision-making that provides leadership and management skills inside the
organization. It smoothed the work flow and motivates the employees to enhance
the productive performance. To maintain the strength of the enterprise a quality
benchmark is required to set that will help in delivering the targets to the customers.
The deficiency in the process will be examined immediately and will be mitigated
from the system.
 Monitoring of Responsibilities and duties: Formation of responsibilities and
duties with proper structure for the organizational staff will help in organizing the
role of employees in the organization. These responsibilities and duties will remove
the deficiencies and conflicts socially as well as economically. The performances of
employees should be monitored and evaluated on various ways in achieving
targets. Benefits and bonus are also provides to the employees on the basis of their
performance matrix as appraisal and incentives that motivates the staff to work with
full of dedication.
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2.3 Recommend with justification, new areas in which the business could be
expanded.
To expend the business operations in hospitality sector, Secret Escape Ltd. should
have to plan and prepare a strategic management with four dimensional matrixes that
will reflect into business growth and expansion. The expansion of small enterprise into
large scale over international market will be defined by Ansoff Matrix figured below-
Figure 1: Ansoff Matrix to expend SBE's
The presentation is as follows-
Market Penetration: Market penetration allows an organization to maximize the
productivity and sales. The owner of travel and tourism industry cans implements new
and innovative ways to advertise their product and service to defeat the competitors by
providing better facilities at low cost. It will attract customers towards the tourism and
tourist destinations in hotel bookings and further growth.
Market Development: The planning strategies will turn the business into increasing
the annual turnover. For small scale enterprises it is not possible to create a huge
expansion into business but with the organizational efforts and customer support
market development can possible for the organization in hospitality sector.
Product Development: Product development refers to modifying the products
according to level of interest of members and customers that specifies the various
opportunities for business. For ‘Secret Escape Ltd.’ it is necessary to improve their plan
and packages according to the environment and seasons that will affect the tourism
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and tourist interest. Modification in plan, product and strategies will includes extra cost
but in the end it will improve the organizational development and increases the profit
margins in growth and expansion.
Diversification: In a business or an enterprise, profit and loss are two coordinating
terms that changes their position according to the environment. In off seasons the
tourists doesn’t shows their interest to move out for exploring destinations, it will
reflects in downfall of the business whereas in on seasons tourist plans for their
vacations for several destinations and it increases the reflection in market.
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LO3
3.1 Produce an assessment of existing business objectives and plans
The business objective and plans for assessment of small business enterprises ‘Secret
Escape’ is followed in these way-
Business Objective Business Process Performance Indicators in
Business
 The organizational
objective of the travel
agency is to provide the
luxurious hotel with
interesting travel and
tour packages at
affordable prices to
attract the customers.
 Requirement of hygienic
environment that suits
the customers with
quality products.
 The business goals and
objectives of the
organization is to
increase profitability and
acquire the business
targets.
 Process is the approach
to complete the task in
order to accomplish
business goals.
 Process helps in
managing operations in
between the
organization and
customers by removing
conflicts and
misunderstandings.
 It contains the
organizational structure
with the controlling and
processing of various
actions.
 Performance indicators
mainly depend upon the
management and
performance of staff and
employees in the
industry by evaluation
and observation.
 The performance levels
are managed by the
managers on the basis
of task completion in
deadlines and positive &
feedbacks obtained by
customer review.
 The satisfaction level of
customers judges the
employee performance
in the hospitality
industries. The staffs
are rated by their
managers and
supervisors with pictorial
representation.
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