MGMT436 Strategic Management

Strategic Analysis of Shangri-La Hotel

Contents

Introduction. 3

Overview of Shangri-La Hotel 3

Strategic Analysis of Shangri-La Hotel 4

PESTLE Analysis. 4

SWOT Analysis: 5

Strategic Recommendation. 6

Conclusion. 6

References. 8

Introduction

Today, hospitality industry is one of the fastest growing, profitable and progressive sectors globally. It is offering a number of specific opportunities for the workforce wide-ranging services to customers. The international hospitality industry is also offering a range of employment scopes for the people which is important in the attainment of economic goals and objectives. It is also becoming more competitive industry in the present time. Most of hospitality companies are facing a range of challenges and issues due to changes in the perception/demand of consumers, shifts in consumer segments, and issues of liquidity. On the other hand, different types of multifaceted issues are also faced by the firms. But, such can be avoided by executed most appropriate business and marketing strategies. This research paper would provide detailed information on the Shangri-La Hotel. Moreover, strategic analysis would be conducted to understand the overall strategic position of the company.

Overview of Shangri-La Hotel

The Shangri-La Hotel was founded in the year 1971 to provide best and cost effective hospitality services to the public. It was founded by Robert Kuok and Headquarters in Hong Kong. It has worldwide business operations including except Latin America and Caribbean. Shangri-La Hotel is a multinational hospitality company that offers a range of hospitality services to the global customers at the discounted price than others. As a hotel company, it has more than 1000 luxury hotels as well as resorts with more than forty thousand rooms. This hotel company has 5 different brands across the different market segments. The hospitality services offered by the company are totally different and unique than its competitors in terms of quality, price, uniqueness, and functionalities. The main objective of the hotel is to make the customer more satisfied and delighted by offering improved hospitality services. The company is also trying to become the first choice hotel for its shareholders, customers and business partners.

Strategic Analysis of Shangri-La Hotel

PESTLE Analysis: It is one of the most significant and valuable strategic management tools that used to understand as well as analyze overall business environment of a company. Based on this, the external environment of Shangri-La Hotel would be analyzed.

• Political: Shangri-La Hotel is a China based hotel company and the China is a political stable country. It means the political stability of China is more favorable, profitable, and beneficial for the hotel company. The hotel company is generating maximum revenues in the country. On the other hand, it is also analyzed that, the hotel is follow the policies, norms, standards, regulations, and instructions of the government in order to avoid any actions against the company.
• Economic: Chinese economy is very vibrant than others nations. The economy of the country is growing at the rapid rate due to its sound and best economic policies and norms which is favorable for the Shangri-La Hotel. The cost of living is also very low than others cities of the global world. Additionally, per-capita income of people is also very high which is helpful for the hotel.
• Social: Most of people of China are from the working class. There is also middle as well as upper class people which are valuable for the hotel company. On the other hand, it is also analyzed that, the social trends within the nations are also changing which may change in the demand patterns of populations. So, it is important to hotel to analyze and understand such demand patters to fulfill the needs of customers.
• Technological: China is one of the fastest growing nations in the world. It is also known for its advanced technologies and innovation. Government of China is investing millions of dollars to motivate and encourage the businesses for the technology. So that they can adopt updated and advanced technologies to run the business successfully. Hence, with the help of advanced technologies, the hotel company is reducing costs and improving the quality of services in an effective and proper manner.
• Environmental: The government of China and its population is much worried for the natural environment. There are a number of strict policies and norms are proposed and executed by the government for the businesses. These standards have to follow by the organizations very strictly to run the business successfully. Moreover, they have to follow Environment Protection Act to protect the natural environment. So, the hotel company is follows same principle of the government in order to deal with any issues. Apart from this, green technologies are used by the hotel to protect the environment.
• Legal: There is no discrimination in China in term of age, race, gender, religion which is favorable for the hotel. The government has set legislation for the minimum wage that has to follow strictly by the hotel. In the same way, the hotel company is fulfilling the legal requirement to deal with the potential legal issues.

SWOT Analysis:

Strategic Recommendation

Based on the internal and external analysis, it is recommended to the Shangri-La hotel that it should invest in new, updated and advanced technology in order to compete in the market successfully. Moreover, it should also invest in traders hotels in order to gain maximum market share. On the other hand, it should make customers and employees more satisfied by offering them better hospitality services and employment scope. At the same time, it should enhance the quality of its services by using new customer oriented services. Moreover, it should follow the legal as well as ethical requirement to deal with potential issues.

Conclusion

Overall, it can be concluded that, the Shangri-La Hotel is considered one of the luxurious, largest and reputed hotels in the country that offering a range of hospitality services to global customers successfully. On the other hand, it can also be summarized that, the hotel has various unites that should be improved by adopting best policies and strategies. The market share of the hotel is also increasing so it should expand its business operations at the global and local level. Along with this, both the internal and external environment of the nation is favorable for the hotel which is helpful the hotel in increasing the revenues and market share. Tight competition is one of the major issues in the front of hotel so it should execute differentiation strategy and unique selling proposition.

References

Balaton, K., & Horváth, D. D. (2019). Responsible Employment as a Strategic Issue. Retrieved from: http://real.mtak.hu/94141/1/SMSIS_2019_proceedings_BK_HDD.pdf

Converse, B. A., & Reinhard, D. A. (2016). On rivalry and goal pursuit: Shared competitive history, legacy concerns, and strategy selection. Journal of personality and social psychology, 110(2), 191.

Marsh, T.D., (2018). Regulated to Death: Occupational Licensing and the Demise of the US Funeral Services Industry. Wake Forest JL & Pol’y, 8(2), p.5-15.

Peterson, S. A. (2019). Advances in Information Technology Integrated with Strategic Direction. In Advances in the Technology of Managing People: Contemporary Issues in Business. Emerald Publishing Limited. Retrieved from: https://www.emerald.com/insight/content/doi/10.1108/978-1-78973-073-920191002/full/html