Student Name: Md Nazrul Islam

Student ID: 2280224

Unit/Module: Hospitality Business Strategy

Programme: HND in Hospitality Management

_______________________________________________________

Nelson College London

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Hospitality Business Strategy

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Contents
Introduction......................................................................................................................................4

LO-01...............................................................................................................................................5

Applying appropriate frameworks, analyse the impact and influence of the macro-environment
on a given hospitality organization and its strategies..................................................................5

Critically analyses the hospitality macro environment to determine and inform strategic
management decisions.................................................................................................................8

LO-02...............................................................................................................................................9

Analyse the internal environment and capabilities of a given hospitality organization using
appropriate frameworks...............................................................................................................9

Critically evaluate the internal environment to assess strengths and weaknesses of an

organisation’s internal capabilities, structure and skillset.........................................................12

LO-03.............................................................................................................................................13

Applying Porter’s Five Forces model, evaluate the competitive forces of a given market sector
for a hospitality organization.....................................................................................................13

Devise appropriate strategies to improve competitive edge and market position based on the
outcomes....................................................................................................................................15

LO-04.............................................................................................................................................16

Applying a range of theories, concepts and models, interpret and devise strategic planning for
a given hospitality organization.................................................................................................16

Produce a strategic management plan that has tangible and tactical strategic priorities and
objectives...................................................................................................................................21

Conclusion.....................................................................................................................................22

References......................................................................................................................................23

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Introduction
To run any business a business strategy has to be constructed. Main goals of business strategy
are to run all the activities smoothly and achieve the result that is expected. In this report, we will
be discussing that business strategy of a hospitality organization directly impacts the expected
success rate. A company’s affairs and functions are dealt with through the pre-constructed
business strategies. A mapping for the ventures under the project is done in strategies. Hilton
London Bankside is one of the well-known hospitality establishment in the UK. As a corporate
strategy manager in the hotel, environmental analysis and strategic growth management plan will
be discussed in this report.

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LO-01
Applying appropriate frameworks, analyse the impact and influence of the
macro-environment on a given hospitality organization and its strategies.
Framework: Framework can be described as the basic structure of an establishment on which it
stands. The framework contains all the features that are needed for the establishment to work.
Shortly describing framework is a set of rules for the organization and a complete structure to
run it smoothly. Following the mission and vision of the organization, the strategic structure is
constructed to achieve the goals of the organization. [CITATION Placeholder1 \l 1033 ]

Strategy: Constructing a plan of action to reach the desired goal can be described as the strategy.
Among many techniques that Hilton London Bankside follows to assess the impact and influence
of the macro environment, we will be discussing DESTEP model and MENDELOW’s matrix in
the report.

PESTLE model:

Political Factor

Environmental Economic
Factor Factor

Legal Factor Social factor

Technological
Factor

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Political Factor: Political stability is crucial to any business in a specific region. To do business
fruitfully healthy business environment is a must which indirectly bridged to politics. With good
political support, Hilton London Bankside will do good business on the other hand in an unstable
political environment it is quite impossible to do generative business. For political turmoil, it
will be difficult for Hilton London Bankside to attract foreign customer. If in the country the
political condition is good, people will be encouraged to visit other country and the business of
Hilton hotel will be good.,

Economic Factor: Economic status is strong in the UK which is good for Hilton London
Bankside. A resourceful economic state is good for any business. GTDP, GNI, Import duty rate,
sales tax/vat these are all interconnected to any business. The business will not come to the
country in case of a bad state of previously mentioned factors. UK's employee rate, banks
interest and inflation rate all include the economic factor. [CITATION Nad16 \l 1033 ]. If the
enjoy good economic condition the business of Hilton hotel will flourish and people will be
happy to spend more money on entertainment.

Social Factor: the UK is enriched with its social values. Culture of this country is influenced by
combined nations. The unique culture of the UK and its food fascinate a large number of tourists
all over the world which is an advantage for Hilton London Bankside. Many business blunders
happen due to cultural blunders which are not an issue in the UK and its hotel business.

Technological Factor: Tourists look for ease and luxury while booking. Technology plays a
vital role in this area. As Hilton London Bankside is always embraced developing factors, here
comes technology and automation keeping in mind that client satisfaction is the main goal.
Technology increases the luxury of the service and it is mostly related to the service industry.
The hotel offers high tech-based luxury service and it attracts the customer.

Legal Factor: Legal factor include the laws and regulation of the country related to the hotel
industry. The Hilton London Bankside must follow all the laws of the country otherwise it will
face financial penalty form the government. Sometimes the UK government impose hard rules
and laws on the hotel in that case the hotel failed to attract customers and it harms the business
operation. So, the legal factor has both positive and negative impact on the business of Hilton
London bankside hotel.

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Environmental Factor: Natural factors, in other words, the ecological state has become
important for doing business throughout the years. Climate change is a pressing concern in the
UK.[ CITATION Emm19 \l 1033 ] Weather in this country is both well and troublesome.
Suitable weather attracts loads of tourists which brings in business for Hilton London Bankside
on the other hand in troublesome time’s herms the business in this industry.

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 Critically analyses the hospitality macro environment to determine and
inform strategic management decisions
Macro environment has great supremacy over Hilton London Bankside. All the critical high-
level management decisions are made after proper analysis of the macro-environment and its
effect on the specific subject. All plans of London Bankside are constructed after a complete
analysis of the macro-environment. Macro environment in the UK is suitable for tourists which
attract many people from different countries. Considering the above fact it is business-friendly
for London Bankside. GDP growth is stable in UK [ CITATION Ian19 \l 1033 ], which helps
London Bankside management to come up with great strategies leading to fruitful profit.

Considering the macro environment, making constructive strategic planning for London
Bankside in deferent scenarios has been beneficial.

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LO-02
Analyse the internal environment and capabilities of a given hospitality
organization using appropriate frameworks.
Internal environment and components of a business can be considered as organs of the business.
The elements of the internal business environment affect decision making greatly.[CITATION
Wor \l 1033 ]

VRIO is a framework which analyses a business’s internal aspects. We will be using the VRIO
framework to discuss the internal environment and capabilities of Hilton London Bankside Hotel
bellow.

Valuable: VRIO analysis of Hilton London Bankside shows that the financial resources are
greatly valuable. To sun the establishment and invest in future endeavours financial support is a
must. The employees of this hotel are also a huge part of its valuables as a significant number of
its employees are highly trained and familiar with its traditions. Employees of this establishment
are loyal to the company and are directly responsible for customer satisfaction and positively
representing the hotel to the world. The distribution network of London Bankside is highly
valuable to this company. Human capital, data, information and talented employees are the most
valued resource of the Hilton London Bankside hotel. These things also the competitive
advantage and for the hotel.

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Rarity: Not many companies possess strong financial recourses in this industry so financial
resources of Hilton London Bankside are considered rare as per VRIO analysis. Patents of Hilton
London Bankside are also considered rare as per VRIO. The distribution network of this
company is identified as rare due to the strong nature to network in this sector of this company.
Other companies will require a lot of investment and time to come up with such a network. The
trained and tech adapted employees are a rare resource of Hilton London Bankside hotel. The
quality and talent of the employees cannot be possible to imitate in the market.

Imitability: VRIO analysis states that the patent of Hilton London Bankside is very hard to
imitate as it is not legally allowed. The database human capital management of Hilton cannot
possible for other organization to imitate easily. It needs another hotel to invest a huge amount
on the development of the software. It is not easy to train all the employees with short time and
establish an efficient HR system. It needs time. So, this management system of Hilton London
Bankside is not possible for other companies to imitate within a short time. This becomes the
temporary competitive advantage for the Hilton London Bankside hotel.

Organization: To sustain a secure position in the market an organization must be well

organized. The financial resources and distribution network of this hotel is considered as
organized by the analysis of VRIO. The Hilton hotel bankside has a good management system in
the organization and the manager are so capable that they have done good design of the resource
so that it can possible to use the resource properly. The management structure is very easy and
chain of command is maintained so that any problem can easily be sorted out. The management
adding value in the service.

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SWOT analysis of Hilton London Bankside:

SWOT analysis is a framework which enables a company to detect its strength, weakness,
opportunity and threats. SWOT analysis of London Bankside will be described below.

Strength:

 Strong financial state is a strength of this establishment as running the hotel and
investing in future sectors requires a good amount of financial support.
 The employees are the great strength of this company as they are well trained in their
respective fields and their quality of work gains the company the good name that it has.
 The facility like the indoor pool, fitness centre, the digital key is the strength of the
hotel. These services are unique and one can enjoy these services only in the Hilton
London bankside hotel.
 All facility for the business conference is available in the hotel including video
conferencing, fax and photocopy machine. This is the strength of his hotel.

Weakness:

 The distance from the nearest airport is 18.6 miles to the hotel, this can be considered
as a drawback.
 Less marketing campaign and less brand recognition are the weakening of the hotel.
 The marketing department is very week and there is no promotion campaign and social
media marketing of the organization. This is one of the weaknesses of this hotel.

Opportunities:

 Local hotels can be acquired by the company to eliminate the competition from the
market.
 Can open branches in highly tourist populated arrears to expand the market.
 It should launch a new promotional campaign and attract tourist and can offer a discount
on room rates.

Threats:

 The hotel industry is a very competitive sector. Each establishment has to work
tirelessly to maintain the quality in the market.

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  Brand new openings with innovative approach can be a considerable threat sector.
 High competition in the market is one of the big threats of the hotel.
 Brexit is another significant threat for the UK and the Hilton London bankside hotel. It
may decrease the amount of guest in the hotel.

Critically evaluate the internal environment to assess strengths and

weaknesses of an organisation’s internal capabilities, structure and skillset
The strengths and weaknesses of Hilton London Bankside’s internal capabilities, structure and
skillset are assessed bellow.

Strengths: Hilton London Bankside hotel is one of the most well-embraced hotels in the UK.
Combined well-decorated interior and spaciousness is the most eye-catching factor in the market.
The well-trained staff, their service and the food quality are well recognized. The financial
stability of the company is its greatest strength. They can over through all kinds of local barriers
due to the well-established network and financial condition.

Weaknesses: The primary weakness is the cost of the hotel. Due to the quality of the services the
hotel provides, the price for it also increases in the same ration which is simply out of the price
range of the average guests. The higher range of taxes that the hotel has to pay can also be
considered as a downside.

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LO-03
Applying Porter’s Five Forces model, evaluate the competitive forces of a
given market sector for a hospitality organization
Incorporate strategy formulation Porters Five Forces model has a global impact. The main goal
of this model is to gain a competitive advantage. In a simple model, a large no of different
factors is brought in this model. Hilton London Bankside hotel uses this model to analyse
compotators and come up with a strategy to gain long term profit.

Bargaining power of suppliers: The cost of raw materials are completely dependent on
suppliers. Suppliers hold great power in the market. The fewer the number of suppliers the
higher the price will get. Eventually, it will raise the cost of the hotel room rent. Ultimately it
will reduce the number of guests and affect the business. If Hilton London Bankside has
connections to more suppliers it would eventually reduce raw costing which will help revise and
update the services given and help compete in the market on a better platform.[ CITATION
JIM20 \l 1033 ] If there are suppler in the market, it will increase the bargaining power of the

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hotel. As the hotel has many options. In the UK market, all the hotel has many of the suppliers
and the hotel put high bargaining power on the suppliers.

Bargaining power of buyers: customers are the main component of the hospitality industry. As
they hold the highest power to bargain. It is important to have customers on a large scale and
categories. To bring in customers on different occasions, London Bankside hotel provides unique
services, provides suitable and exclusive packages. The key to making loyal customs is to come
up with good marketing strategies. The UK market has many big hotel chains and the
competition is very high among hotels. So, the customer of the hotel has high bargain power and
they can change their hotel if the hotel failed to satisfy him. So, the Hilton London bankside
must satisfy the customer otherwise he or she will shift to other hotels.

Rivalry among existing competitors: the number of existing competitors in the market and
their strength and weakness can be assessed with great consideration is very much needed. When
the level of competition is high in the market, suppliers kicks in and provides better packages
which are also troublesome. The hotel industry is already very competitive in the UK market
and London Bankside faces great from Native Bankside Hotel and many more. To survive in the
market London Bankside keeps reinventing the services.

The threat of new entrants: A companies market can be ruined by the new entrants as it takes
less time and money to enter an already built market. Improvising in the market and come with
better services is always a great threat. It is very difficult for any hotel to enter the UK hospitality
market. As there already has giant hotel companies in the market. It is an advantage for the
Hilton London Bankside.

The threat of substitutes: Hospitality industry does business on satisfying guests through
services. So the goal is the same but the way has to be unique for London Bankside. Because
when the same services are available, the guest will have more options and product rate will
decrease. So, the product has to be exclusive to do good business in this field. So, the Hilton
must plan and prepare excellent customer service operation otherwise it will lose many of the
customers.

All the above-mentioned facts are very crucial and require proper supervision to always be ready
in this dynamic industry.

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15
Devise appropriate strategies to improve competitive edge and market
position based on the outcomes
Surviving and keep getting revenue is the goal of any organization but only herd work is not
enough to sail through a market full of sharks. Any organization, in this case, Hilton London
Bankside hotel must pre-plan and follow some strategic frameworks. Hilton Bankside thoroughly
analyses the DESTEP model to understand the environment and market properly, to keep the
flow to business uninterrupted. Among many Porter’s Five Forces model is another crucial
framework that this hotel follows to always keep the current market status in the count and to
stay ready to face all the pre-assumed threats and obstacles. Hilton London Bankside hotel can
reinvent the facilities that they already provide due to the dynamic nature of this market. They
can modernize the existing facilities line to save guests valued time check-in and check-out can
be made online, room lock and unlock system can be digitalized, like it can be synced to the
mobile phone, many hotel management updated systems are available in the market, it should
also be noted for smooth operation and better service to the guests.

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LO-04
Applying a range of theories, concepts and models, interpret and devise
strategic planning for a given hospitality organization
Any hospitality management has mission and vision which includes the current objectives and
the extension to be added in the coming days. In current times the modern market offers many
frameworks to build a concrete strategic plan for the organization and its future. Considering the
mission and vision the strategy must meet the objective. We will be discussing Porter's generic
strategy analysis of Hilton London Bankside bellow:

Cost Leadership Strategy: Drawing in guests is the main objective in this industry to gain
revenue. A great way to do it is lower the prices of the services. It is only possible for a hotel
when it lowers the in house expenses first. Only then it will be possible to provide better offers
for the customers. It will increase the radius of customers. Hilton Bankside can gain popularity
through it and get more customers, it is a win-win situation.

Differentiation Strategy: Everybody wants variation in the product that they are buying. And
similarity lowers the value as well. To get a competitive advantage hotel must make themselves

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different[CITATION Bor \l 1033 ]. To be dissimilar to another one must provide unique services
and adapt to modern-day technology.

Cost Focus Strategy: Assessing the in house resources one must come up with a plan of action
to target a specific market. It will help keep the cost in check and understand the market
properly. It is only a stepping stone to leaping into the bigger market. This strategy enables to
provide service at a low cost.

Focus Different Strategy: Understanding the competitor’s strength one must come up with a
unique product to the market to stay ahead of other companions. This is key to get the loyalty of
the customers.[ CITATION ANN18 \l 1033 ]

The Hilton London Bankside should adopt the cost leadership strategy. As the main focus of any
organization is to gain profit. It can only happen when the hotel will minimize the cost of the
hotel. Cost leadership strategy is very effective but it is difficult to establish. But the hotel has a
very qualified human resource and manger. The tech-based management system will help the
hotel to reduce the cost and increase the rate of profitability.

Ansoff’s matrix:

Ansoff's matrix is the strategic tools and it will help to analyses the future growth of the
organization. The future growth of the Hilton London Bankside is described with the Ansoff
matrix.

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Market Penetration: Market penetration means to increase the sales of the existing product in
the market. It can be done by expanding the territory and by adopting the promotional campaign.
The Hilton London Bankside can do promotion of their service and attract customer by providing
a discount on the special days. It will increase the sales of the hotel Another thing the hotel can
open a branch in other location of the county. It will also increase the sales of the hotel. This way
the hotel can penetrate the market.

Product Development: The Hilton London bankside can offer new product and service to the
customer and it will increase the sales and gives a completive advantage in the market. The
product development team of the hotel can bring new product in the market which does not exist
in the market till now. It will attract the customer to take the service of the hotel.

Market Development: Market elopement means to enter new terror with exclusive service and
product which do not exist in that country or region. The Hilton London Bankside can attract a
new segment of the market which it is not served before. It will increase the sales of the hotel.
The new market can give more information about the customers need and want. This information
will help the product development department of the hotel to innovate new product and service
for potential customers.

Diversification: Diversification means to enter a new market with new product and service.
Diversification needs huge investment and innovation. With the help of diversification, the hotel
can enter a new market and serve new potential customers. It will help the Hilton London to
make a profit and the portfolio always reduce the financial risk of the company.

So, Hilton London Bankside cannot adopt all the strategy together. The hotel should enter one
suitable strategy for the organization. For the Hilton London Bankside, market development will
be the best approach. The hotel should enter a new market with great service. It will increase
brand reputation and increase sales.

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Bowman’s strategic clock Hilton London Bankside:

Low price and low value-added: Organizations does not follow this method while being in a
competitive position. Setting the price low is the strategy to get the customers. The goal is to not
letting others undercut.

Low price: targeting to be the leader in the smaller market. Minimizing the in house cost and
provide lower prices to the guests in the goal.

Hybrid: Providing customers with good products while cutting the price down. This is a good
strategy to fetch customers.

Differentiation: Differentiating the products from other availabilities. Providing quality and
unique services to the market is the key here. Making a name for themselves.

Focused differentiation: providing the elite quality product and raising the price of the product
very high is the strategy here. People us peruse it for the high added value of the product.

Risky high margin: This is said to be a doomed road. As products provided does not offer
anything extra but the price is set to a high range.

Monopoly pricing: Monopoly happens in the market while there is only one provider to a
specific product and quality is not a question here.

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Loss of market share: While the quality is not standard but the price range is well structured.

[ CITATION PAT18 \l 1033 ]

Strategic planning of Hilton London Bankside:

Plan objectives: The Hilton London Bankside want to enter a new market to increase sales and
brand recognition. It is called market development. It will be the right choice for the hotel to
increase the sales and it is the long-term solution.

Marketing mix: The marketing mix consists of four items product, price, place and promotion.

 Product: The product of the hotel will be the same in the new place which includes
luxury hospitality service, restaurant service, business conference service and many
more.
 Price: The price of the product will be set based on the economic condition and the
purchasing power of the customers. The service of the hotel is for the high-class people
of the new territory.
 Place: The place of the hotel will be near the seashore as it implies the name. The place
should have a good view of the hotel and the scenic view will be the attraction of the
tourists.
 Promotion: The hotel should use the most accepted promotion in the new region and
must do social media promotion for attracting people from all over the world.

Target group:

The target group of the hotel will be the high-class people, business organizations and celebrates
of the world.

Budget: It needs a very high budget to enter the new market. So, the expected budget is more
than 50 Million dollars.

Strategy: for making this plan successful the hotel should adopt the differentiation strategy. It
will give a competitive advantage in the market.

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Produce a strategic management plan that has tangible and tactical strategic
priorities and objectives
Hilton London Bankside has already made a name in the market. The goal is not only to
consume as much business as possible but also to upgrading themselves too.

 Spreading the business throughout the UK and its different tourist populated arrears.
 Providing guests with services that they have not received before, like rental clothing and
transport directly from the hotel,
 Keeping the stuff of the hotel updated to the global trend, simply put keep them trained
regularly.
 Giving customers a unique food experience.
 Management will keep themselves updated on word trends and guide the teams in
different view which will help them adapt to modernization.
 Marketing policies will remain very dynamic due to the nature of this business.

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Conclusion
The world is in a very dynamic state currently. Communication is getting easier and people are
moving from place to place due to various needs. Some for business needs some for the thrill of
it only. Here kicks in the hospitality industry, this industry is flourishing rapidly and with it, the
compaction is greatly existing in the market. Many new minds are entering the industry which is
keeping the preexisting companies tireless. The only way to thrive in the industry is to keep
reinventing the services and products, for that purpose many frameworks are available to
organize and manage in a better manner.

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Emma Knowles, 2019. Overview of the UK's environmental sector. [Online]

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Ian Stewart, D. D. T. S. P. I. &. M. L., 2019. UK corporate environment, Deloitte, London: s.n.

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KUIJK, A., 2018. Porter’s Generic Strategies. [Online]

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