SHM608 HOTS Simulation Case Assignment Sample

Strategic Hotel Management

Contents

Company Introduction

Strategy plan for HOTS

Macroeconomic factors

PESTLE analysis

Micro Environment

SWOT analysis

Hotel decision categories

Conclusion and Recommendation

Company Introduction

The hotel was built in the second of the last century during the area growth for vacations and short breaks. The plan is designed for restructuring business for operational profitability through strata decisions. The strategy is a long term direction for the organization in decision making (Evans, 2015).

Strategy plan for HOTS

The strategy is a long term direction for the organization and decision-maker. Strategy plan for HOTS hotel takes place in 5 stage model As a low-cost strategy, the crafted single strategy can be used in different subsidiaries for a network of companies and leveraging synergies while competing in the market (Okumus, 2019). As a strategic plan, the firm can execute an integrated approach across revival for the next few years.

Macroeconomic Factors

PESTLE Analysis

The PESTLE analysis will help management in the understanding of the macro-environment factor that invariably will impact industry and HOTS hotels.

Social factors - This relates to people and their changing social values. The impact of health and suitability drives people towards sustainable hotels, health, and green drove hotels for association with the ethically forward organization. Demographic factors have an outcome on consumption and product and services growth (Camilleri, 2017).

Political factors- The political climate of the country promotes investment and research in development with investment in small and medium-sized firms.

Economic factors- The form has become a popular location and tourism is central to boost tourist experience and conferences. Macroeconomic factors affect the industry and company operations with an impact on the interest rate and recessionary environment on overall spending that will make the environment uncertain (Luisa, 2020). This is an advantage for HOTS hotel with economic factors as favorable in the region.

Environmental factors - Business environment on maintaining green energy yes and sustainable structure will attract tourists and act as differentiators.

Legal structure- Lower tax structure and council relocation offers a legal structure that is feasible for expansion of HOTS hotel. Legislation related to payment structure and capital operations may impact operations if applicable in the future.

Technological factors- Technological impacts are related to advertisement and AI/ML in predicting technology for understanding consumer dynamics. Adapting to technological change will keep the company running in the long run.

A Focus on A Low-Cost Strategy

HOTS, by applying low-cost strategy can serve niche members at lower prices and build a competitive advantage in establishing private labels.

5 stage model is - Developing a strategic vision, mission and core value- To deliver a distinguishing experience at an affordable price to serve people at the best

Our Values- Respect and empathy while building operations for the professional growth of our colleague and guest satisfaction. We believe in innovation and drive change

Stage 2- Objectives

The objectives are related to financial performance and future business prospects for the company. These are leading indicators of organizational activities.

Financial objective -An increase in 5 % in annual revenue over YOY growth

Increase fleet size operations for and increase earnings per share by 5%

The strategic objective is Product development for upper management aged 30-50 year

Improving information system and training program for front end staff

Achieve a customer retention rate of 5% in the northwest region

Stage 3 crafting strategy

Company strategy-making hierarchy. The corporate strategy for managing the business is diversification and business strategy for a company to market position in cost strategy (Wood, 2017). Corporate strategy for business synergy and internal development and entering the market through a strategic alliance with the business group (Suresh, 2015).

The functional strategy will be through the unit head. This will be orchestrated through functional activities by the unit head in operations, finance, and the core team at HOTS Hotel. This will help in managing functional strategies for product development and customer service.

Stage 4- Implementation and execution

Company staff allocation and organization recruitment will be set up through policy and procedure

Value chain activity and operating system for leveraging business operations at the highest level with social media strategy.

Stage 5- Evaluation and corrective adjustments

Corporate governance by financial reporting and accurately monitoring for financial statements will ensure that common operations are run and financial control are in place.

Yearly monitoring by CFO and independent company board to determine companies' operations and evaluation of strategy.

Business ethics involves the application of ethical principles to decisions of the business. The business follows ethical conduct to ensure services to its client. The company through its objective will ensure strong action on misconduct.

CSR refers to providing good working conditions, an active environment, and encouraging diversity in the business (Suri, 2015). HOTS will ensure water, carbon emissions. As a responsible organization, the firm will support Sustainable Development Goals

HOTS focus on diverse and inclusive workforce and company websites will promote mutual respect, diversity, and equal opportunities. Food wastage prevention plans and child education will be the key issue that the company will focus on through workshops and programs to create a platform for society and HOTS hotel interaction. The food drive will provide opportunities for donation program through a fundraiser as a revenue source (Wagen, 2015).

Micro Environment

SWOT Analysis

SWOT analysis is the ability to arrange information for understanding business factors and improving business performance (Tajeddini, 2020). The below analysis helps in strategic plans for business and opportunities and threats faced by the organization. 

Strength – Proximity to the airport for the town and connectivity through road, rail, and bus link. The hotel is in good condition since the refurbishment program.

Weakness – Old building with no star rating listed. The company has a staff turnover issue and has no leisure facility, conference room. Supplier in the current market is not concentrated and customers face differentiated cost may switch easily.

Opportunities- The local authority offers favorable economic relocation package and has used tax income for the reestablishment of tourist attraction.

Threats- The town has become popular that has shaped opportunities for tourism business that has extensive competition among market players.

Short term measures

• Focus on customer satisfaction and building restaurant awareness
• Reducing staff turnover rate

Long term measures

• Building hotel amenities for increasing its attractiveness through bar and conference room and leisure facility.
• Upgrading the hotel facilities by improving refurbishments.
• Establishing training measures for staff to improve quality service
• Undertaking cost measures to compete with competitors

Hotel Decision Categories

Advertising- The HOTS hotel awareness will boost its room occupancy. Discount offer on a weekend drive and longer stay will increase customer stickiness. Highlighting the room facility through social media campaigns will lead to outreach and brand recognition among viewers and would be a cost-effective option (Lynch,2018).

Training measure – Training is central to improving staff customer service (Tomczak, 2018). The bands are given for different periods. The training cost increased over the years by this hotel used this measure to reduce staff turnover. Staff allocation has been decided by the management.

F&B- The firm will focus on low-cost strategy through local sourcing and maintaining zero wastage policy to ensure that firm maintains facility utilization to 100 %. The design of the menu will be modern and continental.

Room facility and guest comfort- The room structure will be priced through seasonal structure and dynamic pricing to ensure the firm profitability on peak days. In-room essentials for refreshments, desk structure, design supply, and access card for availing food and beverage services for a hassle-free stay.

Expansion facility- To add credibility to the restaurant the hotel will be star rated and will start with 3 stars with gradual progress to 4 stars during the course of 5 years. The conference room facility will be designed with room refurbishment standard maintenance as a measure in the first year itself. The bar as the attraction will be developed in the 2nd year.

Staff- Staff is essential to maintain optimum service. Key incentives on client feedback and customer service over the month will be applied for providing staff reward and recognition to ensure staff loyalty and maintain the turnover rate.

Revenue stream- Maintaining distribution and booking through the cloud base system to ensure client details are managed and no error in bookings (McGurie, 2015). Partner tie-up with local market players to ensure the company has referrals on clients visiting the town.

Financial arrangement- The business faculty expansion will be designed through a loan for 25% aggregate expansion and rest through the management pool of resources.

Environment management system - Sustainable business practice by the use of biodegradable products and the minimization of plastics to support the environment. The in-house re-engineering process will ensure the soap and disposable items and packaging and designing are sustainable. These actions will ensure buyer confidence and differentiation in the hotel industry. The firm will ensure hygiene kits for solid wastage prevention and creating ongoing support for the organization. The company will maintain a high standard of excellence and taking ownership of services offered at the hotel.

Conclusion and Recommendation on HOTS Simulation Case

The hotel market share will increase over 5 years. The management team has potentially addressed the issue related to employee turnover. The conference room as a construction plan will boost revenue for the hotel. The facility development will incur an additional cost but will act as a competitive advantage.

Reference List for HOTS Simulation Case

Camilleri (2017). Corporate Sustainability, Social responsibility, and environmental management: An Introduction to Theory and Practice with Case Studies. Springer publications

Evans. N. (2015). Strategic Management for Tourism, Hospitality, and Events. Routledge

Okumus, F. Altinay, L. Chathoth, P. & Koseoglu. A.M. (2019). Strategic Management for Hospitality and Tourism. Routledge

Luisa, C., Calisto, C., Gustavo, L. (2020). Strategic Business Models to Support Demand, Supply, and Destination. IGI Global.

Lynch, R. (2018). Strategic Management. Pearson

McGurie, K. (2015). Hotel pricing in a Social world: Driving value in the Digital economy. Wiley

Suresh, K. (2015) International Tourism and Hospitality in the Digital Age. IGI Global

Suri, PK. Yadav, R. (2020). Transforming Organizations through flexible systems management. Springer publication.

Tajeddini, K. Ratten, V., & Merkle, T. (2020). Tourism, Hospitality, and Digital Transformation:Strategic Management Aspects. Routledge

Tomczak, T., Reinecke, S. &Kuss, A. (2018). Strategic Marketing: Market-Oriented Corporate and Business Unit Planning. Springer publication

Wood, R. (2017). Hotel Accommodation Management. Routledge.

Wagen,l. & Goonetilleke, A. (2015). Hospitality Management, Strategy, and Operations: Edition 3. Pearson Higher Education AU

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