Analysis of External Business Environment for Wyndham Hotel Group

This report provides an in-depth analysis of the external business environment affecting the Wyndham Hotel Group, a global hospitality company. It examines the influence of local governments, including their structure, operations, and impact on the sector, focusing on employment and taxation policies. The report further explores the role and influence of the European Union (EU) on the hospitality industry, covering economic, legal, and social aspects, as well as the impact of EU regulations on the Wyndham Hotel Group. Additionally, the report assesses the role of pressure groups and their political influence on local and national issues, and the legal frameworks within the UK, comparing the English and Scottish systems. The legislative processes of both the UK and EU are evaluated for their impact on the Wyndham Hotel Group. Finally, the report concludes by assessing different types of businesses in the service sector, the legal processes for company formation and dissolution, and the structures determining responsibility and control within a registered company. This comprehensive analysis provides valuable insights into the challenges and opportunities presented by the external environment for the Wyndham Hotel Group.

EXTERNAL
BUSINESS
ENVIRONMENT

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
TASK 2............................................................................................................................................1
2.1 Structure, operations and influence of local government on Wyndham Hotel Group.....1
2.2 Role and influence of EU and their impact on hospitality sector.....................................2
2.3 Role of pressure groups and their political influence on local and national issues..........3
2.4 Legal framework within UK and the major difference between the English and Scottish
system.....................................................................................................................................4
2.5 Evaluating the UK and EU legislative process and their impact on Wyndham Hotel Group
................................................................................................................................................5
TASK 3............................................................................................................................................6
3.1 Assessing different types of business which operates within the business and service
sector.......................................................................................................................................6
3.2 Legal processes which are necessary for formation and dissolution of registered company
................................................................................................................................................7
3.3 Structure and process determines the responsibility and control with registered company
................................................................................................................................................7
CONCLUSION................................................................................................................................8
REFERENCES................................................................................................................................9

INTRODUCTION
External business environment for a business venture comprises all the outside factors
which generally influence the functioning of business enterprise. These external environment
consists of major elements on which organization do not have any control and they have to adopt
the changes as per the market requirement (Teece, 2010). This present report has been prepared
on Wyndham Hotel Group which is one of the holding company of the Wyndham Hotels &
Resorts, RCI and various other lodging other brands. Further, mentioned hospitality firm have
their effective operations whole around the globe and they have almost 122 hotels whole over
UK.
This present report has been prepared in order to understand the government policy and
their impact on mentioned hospitality firm. Further, this report will also help in knowing the
various structure, operations and impact of local government on various hospitality industry.
TASK 1
Covered in PPT
TASK 2
2.1 Structure, operations and influence of local government on Wyndham Hotel Group
Local government is treated as a sphere of government which is very close to the citizens
of UK. Further, different beneficiary services are provided by the local councillors and
municipalities to the service industry which helps them in increasing their revenue and
profitability. Moreover, with having a long history of inheritance for governing and controlling
the constituencies, UK government has a proper and systematic structure of hierarchy which
constitutes different government officials (Filatotchev and Nakajima, 2010). Apart from it, local
government in England functions their duty either in one tier system i.e. unitary authorities or in
two tier system which comprises regional and district councils.
Majorly, local government focuses on the two tier system and in this, county council
being the smallest unit of government which is directly connected to the citizens and they record
the issues which are faced by the individuals like social care, transportation, highway, education,
etc. On the contrary side, district council covers large area as compared to the county council
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(Roles of Local Government, 2015). Under this, different segments are concluded which is
majorly responsible for the housing, environmental health, local taxation policy, etc.
Influence of local government on the hospitality sector
Policies and procedures formed by the local body has a significant impact on the
functioning of hospitality sector and this influence can be in the form of: Employment policy: UK government focuses on gathering multi skilled and talented
employees and by identifying them, they place them in different sections of various
industries. Hospitality is considered as a vast industry as it has different departments and
requires a good number of strength. Apart from it, they have various policies, regulations
and they take effective decisions on major issues like salaries, employment and varied
others.
 Taxation policy: UK government is responsible for collection of taxes and generate
effective revenue from the same. Within the hospitality sector, they comprise varied areas
from where they collect the taxes and these are sales tax, service tax, corporate tax, etc.
Moreover, these taxes having a huge impact on the revenue and sales of the hospitality
venture.
2.2 Role and influence of EU and their impact on hospitality sector
National government of UK and EU plays a crucial role in influencing the hospitality
service. Some of the major factors are:
 Through taxation and spending
 With help of laws and regulations
 Positively by providing advice and support to business
Further, European Union (EU) is an international organization which runs in order to
stabilize the condition for all the member countries by considering the different areas like
economic, social, political, technological as well as environmental (Carroll and Buchholtz,
2014). Further, EU is a body who give freedom and liberalization to all member countries by
allowing them to have free movement of factors of production, custom duties and relaxation in
taxes and tariffs. By allowing this, organizations will be able to achieve their set goals and
objectives in proper manner. Further, countries who are part of EU are easily able to trade their
operations from one country to the another. Hospitality sector is much broader sector in UK
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because there exists large number of tourist arrivals. EU constitutes 78% share in the service
industry where hospitality sector holds considerable amount. Some major aspects which impacts
the service industry has discussed down under:
 Economic aspects: EU is a kind of council where some sort of relaxation is given to
member countries such as low rate of tariffs and custom duties, free movement of factors
of production, etc (Aziz and Yasin, 2010). Further, Wyndham Hotel Group will also be
able to hire talented employees from neighbouring country as it will help them to
improve their business operations and earn good amount of revenue for future time being.
 Legal aspects: With imposition of different rules and regulations by EU, functioning of
mentioned hospitality group is affected upto great extent. Hospitality firm have to
consider each and every law which relates with the employment of individual. By not
accepting the same, goodwill of the firm will start pampering.
 Social aspects: Wyndham Hotel Group need to consider the needs and demands of their
clients and have to render best of the services to them. Satisfaction of customer's will lead
towards development of brand image and increase in loyal customer chain. Further,
government also plays a crucial role in supporting the hospitality firm within the UK.
 Employees: Employees are the heart of the hospitality firm and they play a vital role in
the effective operations of organization (Hazlina Ahmad and et.al., 2010). Further, by
considering the significant count of employees within the nation, EU has developed some
laws and regulations for securing some rights of employees and increasing their
efficiency.
2.3 Role of pressure groups and their political influence on local and national issues
Pressure group can be defined as an organized group who do not allow candidates to fight
for election but they seek to influence the government policy from varied aspects (What are
pressure groups, 2015). Further, citizens of UK generally avoid these groups because the
political party is in very less number and these pressure groups are in thousands. It is eventually
because when the membership of the political party falls, they develop their own pressure
groups. However, these pressure groups plays a crucial role in the development and growth of
the country (Aziz and Yassin, 2010). Moreover, these pressure groups also have varied areas of
working which generally impacts the different aspects of the country. Further, hospitality sector
3

is quite broader in the UK and major groups like Hilton, Marriott and Wyndham Hotels running
the chart. Moreover, this industry is more customer's oriented so hospitality have to satisfy the
needs and demands of the customer's in significant manner. Further, these pressure groups helps
in stabilizing different situations which exists within the country and also maintains their
legality. The work of pressure groups has been discussed down under:
 Pressure groups ensures that the laws and regulations formed by the government bodies
are followed efficiently by the business organizations and they consider each and every
components of the same.
 They also ensure that the environment is protected and proper atmosphere is maintained
by reducing the amount of toxics waste and emission. However, hospitality sector
provides various services like adventure trips which impacts the scare resources of the
country (Wang, Chen and Chen, 2012). Therefore, these pressure groups consider this
scenario as well.
 These groups also influence the laws and regulations formed by the government and
different other administrative and legislative bodies. They also consider what the
situation exists within the country and what changes government can make for the
development of the country.
2.4 Legal framework within UK and the major difference between the English and Scottish
system
UK comprises three legal systems and these are English law which is applied to England
and Wales, Northern Ireland law is applied on Northern Ireland and Scot law which is applied on
only Scotland. Some types of law have been discussed down under:
 Statute law: Statute law is dominated by the parliament of UK and this law comes after
the common law. For instance, if there exists a rivalry between two statute, then the later
one exists (Časas and Dambrauskaitė, 2011). Further, abortion is governed by statute law
and power is judged by the Mental capacity act and English Common law.
 Common law: Common law are made by the judges of courts with the implementation of
their desired skills and knowledge. They make their effective decision after listening to
the consent of deceased person. Further, they become the 'Case laws' when the same case
4

comes into the court with different parties. Moreover, doctrine of precedent eventually
means that the lower courts are bounded with the judgements of the higher courts
 European law: UK being a part of the EU their regulations need to be incorporated to
English law before the supreme courts have applied their decisions. Further, all member
countries of EU have to follow the acts and laws which are formed by them in precise
way (Local government structure, 2016).
Apart from this, there exists lot of difference between the legal framework of English and
Scot laws and few of them have been discussed below: Charge against the accused: In the english law, charges are usually simple and are
accompanied by separate summary of case alleged against the deceased person. However,
in the Scot laws, particulars which has arisen in offence are set out at the time of charges
(Wang and Ellinger, 2011).
 Proof: In the English law, a single legal proof work as a source of evidence but in the
Scot law, more than one evidence is required for proving the ofence.
2.5 Evaluating the UK and EU legislative process and their impact on Wyndham Hotel Group
EU hire legislation with the help of various legislative procedures. Further, most of the
legislations need to be projected by European Commission and is then sanctioned by the Council
of EU for becoming a law. Both UK and EU have different structure and policy. There approach
and methods to perform a task differ from one another. UK business venture working in order to
monitor the functions of organization which exists there in (Lee, 2011). Further, laws like
equality act, competition act helps in checking the originality of work and the trading pattern
along with the degree of legality maintained by them. Competition and monetary authority helps
in the process of merger and acquisition with different prescribed ways and legal formalities.
However, if cited business venture avoid any of the laws or acts then it will impact their
business performance and the goodwill which they have created all over the years will get
elapsed. Equality act has its own importance and the HR manager of the business organization
need to consider that effectively. Moreover, if any discrimination has been done on the basis of
cast, religion, or gender then employee or candidate who has suffered can case against the
business venture. This will pamper their brand image upto great extent.
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Further, in fiscal policy, UK government adjusts the level of spending for regulating
economy of nation in effective and efficient manner. Further, this policy also involves the
fluctuation of tax rates on different commodities in service sector. This will impact the
performance of the mentioned hospitality venture and their revenue will decrease. On the other
hand, Monetary policy is regulated by the Central or Federal bank in order to manage the rate of
interest and supply of money within whole UK. Further, when government make any changes in
the rate of taxes then it eventually influences the functioning of the hospitality venture.
Apart from it, EU has also developed other laws as well like Environment protection act
for protecting the environment in order to reduce the carbon emission and restrict the damage
which is happening within the environment. Wyndham Hotel Group being a well renounced
hospitality firm have to follow both UK laws and the EU policies in order to successfully run
their business operations. With this, they will be able to maximize their profit and will be able to
increase the sale of their services in desired manner. Further, if not so followed, then it will
pamper their brand image upto a good extent and the mentioned hospitality firm would not want
the same. Thus, they follow each and every regulation, policies, acts which are related with the
hospitality sector and functions their operations in efficient and effective manner.
TASK 3
3.1 Assessing different types of business which operates within the business and service sector
Business units differ from one venture to the another and they have different set plans,
policies and strategies so that they can have a competitive advantage over their major
competitors who are working within the same industry (Wong, Lai and Cheng, 2011). Various
types of business organization are stated below: Sole trader- Sole trader is a type of concern which is owned by a single person. This type
of business enterprises are very cheap to start and the owners usually keeps all the profits
and distribute some part in form of the salary to their employees who are employed there
in. Further, this process is considered as most common business activity in UK where
business owners produces the goods and services by evaluating the individuals needs and
demands.
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 Corporation- Corporations are as dominating business organizations in UK as the legal
entity is separate from individuals within the business enterprise. Furthermore, these
corporations are owned by shareholders who chooses board of directors from the majority
of polls and after the selection they look forward for prior responsibilities. Wyndham
Hotel Group is one of the example of such business structure. Partnership- Partnership comprises two or more individuals who comes in contract by
accepting Partnership Deed (Bao, Chen and Zhou, 2012). Further, this deed includes
amount of capital which each partner will contribute and also the ratio in which the profit
and losses will be distributed. In this type of organization, risk of business is also divided
and they will share the amount of debt in equal proportionate. Private Limited Company- These companies come under non-public sector which is
usually functioned by few individuals. Moreover, their main motive is to maximize their
profits by increasing their business ventures and reduce the price of the products for
increase in sale of the particular product.
 Public Limited Company- This type of company issues new or existing shares to the
public and are registered with minimum paid up capital. For issuing the shares,
organization have to get registered under Companies Act, 1980.
3.2 Legal processes which are necessary for formation and dissolution of registered company
In order to maintain the consistency and legality within the nation, there exists some laws
which hospitality venture have to follow in order to carry their business for long time period.
Further, at the time of formation of the organization, mentioned company have to fulfil all the
criteria which will help organization to have their existence in proper manner. For this, a
sequence of activities have to be followed precisely and it has discussed down under:
 Memorandum of association (MOA): MOA is treated as a formal document which is
signed by all the parties who are working within the venture. This contract is also an
evidence of all aspects as parties have accepted the terms and conditions of the business
venture. Further, the parties are ready to proceed for further processes (Beynon-Davies ,
2013). Here the location, head office, branches, number of directors, employees, etc. are
clearly mentioned.
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 Article of association (AOA): AOA is also a type of formal document which shows all
the rules and regulations that are supposed to be abides by the parties who has formed in.
 Form 10 and form 12: These forms provide major information of the members like
personal and professions details (birth date and other related) of the parties. However,
form 12 mentions the clauses regarding bankruptcy and other projected issues which can
be faced anytime by the business enterprise.
 Company name: Then, there is a need of suitable name and logo and under that all the
operations will be done (Lim and et.al., 2010).
 Member's voluntary liquidation: This written material is prepared with the positive
consent of all the members where causes relating to loan and debt are resolved and inked
together.
3.3 Structure and process determines the responsibility and control with registered company
A registered company follows a particular format with a set hierarchy. At the top level
there is CEO who undertake all the business operations. Then there are Board of Directors
(BOD) who look over different departments of the hospitality venture. Further, each department
is in need of multi talented and skilled employees and these individuals are guided by the
supervisors. Further, with the set structure, BOD frames strategies and policies and direct their
employees to achieve them within the set time frame (Trkman and et.al., 2010). This eventually
help business to increase their sale and revenue. Apart from this structure, they have their
shareholder's and suppliers who help them in achievement of their goals and objectives.
CONCLUSION
From the above report it is clearly inferred that the External business environment
comprises factors which affects the functioning of business venture. This report showcases that
Wyndham Hotel Group have to consider both UK and EU laws for their proper and effective
functioning. This report also visualize that they prepared the strategies by considering taking all
the government policies into consideration.
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Trkman, P. and et.al., 2010. The impact of business analytics on supply chain performance.
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