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HC2112 Strategic Planning of Hilton Hotel in UK

University: ITCM College London

  • Unit No: 17
  • Level: Undergraduate/College
  • Pages 9 / Words 2250
  • Paper Type: Assignment
  • Course Code: HC2112
  • Downloads: 0
Organization Selected : Hilton Hotel

INTRODUCTION

Strategic planning plays a crucial role in business environment. The present report deal with the current position of Hilton Hotel in UK. There were about more than 570 hotels and resort in 85 countries in United Kingdom. The hotel is well known for its room service and accommodation because it provide its best service to the customers. The report critically analysis the competitive environment. The report also help in assessing the strategic positioning which carry out an organizational audit. The report present different models that carry out for environmental audit for Hilton. The current report presents overall structure and mission with values, vision in hospitality activities.

1. Presenting different factors that should be considered while formulating strategic plans

Internal Factors: It is the most important factor that should be consider for strategic planning. This internal factors are belongs to the company itself such as culture, environment, its policies etc. However it is critically analyses that internal factor affect the Hilton's environment. Organization's culture do effect the plan of a company and it affect the environment internally. Stakeholder of a company such as employees, manager and upper authority (Johan, Baga and Asmara, 2018). This peoples have many expectations from the company. Take dissertation help UK.

Economic Factors: Hilton's strategic planning is affected by economic factors because this factors is directly linked with wealth of a company and the capacity of customers. However it is critically analysis that the current economic condition of a country is recovered from last many years. There are many economic factors such as unemployment, interest rates, that affect the decision making for a company. Sometimes currency exchange rates also affect the planning because the services provided by the hotel seems to expensive because of the effect of currency exchange rates.

Competitive advantages: target the unique position for the strategic planning is consider the another important factor (Peng, 2017). Having high competition in the market will definitely affect the plans and objective of Hilton. It is the best way to determine the exact position of a company but it is critic that company may bear loss due to its rivals and heavy competition in the market. A strong competition will definitely enhance the level of performance and it is considered the main factors among all.

Social Factors: this is another factor that should be considered while making a plan. The social factor includes taste, fashion which varies from person to person and every culture has different taste and choice that are changes according to person to person and society to society. Hilton is improving its workforce and quality of service provided to its customers. To improve the business performance, Hilton determine the importance of health and safety act. However it is critically analyses that social factors some times do not help in strategic planning because all the people have different taste and choice and sometimes the company is not able to fulfill the demand and need of its customers (Leonidou and et.al., 2017). Due to lack of proper strategies, Hilton also do not filling the need of its customers.

Technological factors: it is another important factor for strategic planning and Hilton offer online services to its customers by giving discount vouchers which help to save their cost as well as time (Johan, Baga and Asmara, 2018). As per current trend, the use of this factor increases and it will help in developing new ideas and innovations for a company. Hilton uses all the new technologies in its hotel to attract more number of customers and it is to be critic that sometimes these factor may decrease the level of performance and create negative image in the market as well as in front of its customers.

Political Factors: it is also another important factor which affect the performance of Hilton as well as strategic plan (Das and Rangarajan, 2017). Government sometime increase the tax rate that affect the financial status of a company and lead to suffer heavy loss and due to sudden increase in tax rate the company increases its price just to cover the tax rate which may influence the position of a company in market. This external factor have some disadvantages such that it may decrease the level of performance and it may lead to decrease in its financial status.

By SMART goals: this is another factor that should be consider while making plans. Hilton have their own mission and goals and to meet the exact goals and its objective company should follow SMART which formulate specific, measurable, actionable, realistic, and timely completed (Mahmood, Chung and Mitchell,2017). The smart goals meet all the features of a company and while formulating planning it should be consider the foremost. The goals, aim and objective of a company should be clear and attentive because this will help to meet overall goals.

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2. Assessing strategic positioning of Hilton by carrying out an organizational audit

To asses the position of Hilton it is necessary to know the strength, weakness, opportunities and threats of a company. This is describe below:

Illustration 1: SWOT analysis

Illustration 1: SWOT analysis

Strength

  • Hilton is one of the best leading hotel which consist 13 brands in all over the world. The hotel serve more than 150 hotel in almost 100 countries. It provide its best room service with spa and lunch- dinner facility. The management of hotel provide best innovative ideas in order to attract more number of customer (Peng, 2017).
  • To increase its customer base, hotel wants to develop or create market with Asian countries who help to increase its revenue. Hilton also upgrade its existing business power in order to attract more number of customers.
  • Most of the people preferred to stay in this hotel because of its outstanding service. It offer various types of offers programs such as digital check in and out system, free internet usage, proper room service, cooperative staff etc.
  • it has best customer relation which help to maintain long term business. Recently it had partnership with Uber to create best traveling experience to its customers. It also introduced new digital keys of room which is operated by customers smartphone which is the biggest achievement (Leonidou and et.al., 2017).
  • The company has strong leadership quality which always lead the business in right way and the business uses the strategy of cost cutting which help to attract more number of customers. Innovative ideas of Hilton's owner always lead a business in positive direction and increases its potentiality for future achievement.

Weaknesses:

  • One of the biggest weakness of Hilton is that it has some issue with China which affect its financial position.
  • It has low market share it means that only 80 percent revenue is generated by its hometown and only 6 percent is from Asian market which may lead to face heavy loss in United Kingdom (El-Said and ElMakkawy, 2018).
  • It has a high level of debt which affect Hilton in future.
  • Government sometimes changes its policy and parameters which affect the operations of a business globally.
  • Hilton do not have proper network in Europe and that is why the revenue is not generated as much as the expectations.

Opportunities:

  • Hilton wants to make relations with Australia, because it is one the biggest economically strong country in the world and have highly attraction of tourism, that is why Hilton wants to establish its firm in Australia.
  • Having best relationship with customers is the best opportunities for Hilton. It always try to conducting new innovative ideas that will help to attract more number of customers and help it to increases ts profit as well as revenues (Leonidou and et.al., 2017).
  • Hilton also make its best customer base by introducing itself as partner with the games held in different countries, this help it to increase its customer power and establish good brand image in market.
  • Obtain local hotel and establishing local chain will help Hilton to make good customer base and help to increase its profit.
  • Hilton uses all the latest technologies and make the premises digitalization, this technique help to attract more number of customers because they feel safe and secure there.

Threats:

  • Hilton has many rivals and due to heavy competition in market it is the biggest challenge for Hilton that affect its income and its customer base (SWOT Analysis of Hilton.2018).
  • Entry of new hotel is increases in the market which is the another big threat for Hilton.
  • Its rival companies such as Marriott and Starwood Hotel are always changes its price as per the demand and season while Hilton has threat on competition on price point.
  • Sudden increase in the salary of the employees will led to many problems such as employee dissatisfaction towards their work and this may result in increasing employee problem and they may leave the workplace and it further lead to hiring new ones which is quite long process for a company (Peng, 2017).

By using SWOT, it is concluded that Hilton's position is so strong in the local market but it wants to establish its new unit in other countries like Australia. Hilton always use different strategy in order to attract more number of customer, recently it uses new digitization room key which is operated by customer's smartphones which is the biggest achievement for it. The company's position is strongest in the term of financially as well as through customer relation also.

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3. Environmental Audit of Hilton

For external audit it is necessary to use Pestle analysis which is mention below:

Political Factors: for Hilton, political stability is a basic need to success. In hospitality sector political factors such as number of tourist those who visit the country influence by the political sectors. Risk of terrorist that affect the number of visitors to come and visit the country. This affect the political stability of Hilton and it also affect the customers power which lead to decrease in the selling power (Bohdanowicz and et.al., 2017).

llustration 2: PESTLE analysis

llustration 2: PESTLE analysis

Economic Factor: economic factor is the major factor affecting Hilton hotels and its business in the national and international macroeconomic situation. The GBP exchange rates also affect the performance of Hilton and the Olympics held during a year in 2012where all the hotels are completely booked and the whole situation is completely different from the games which are done at the time of Olympics. Many years had been passed when UK faces the financial crises but still the national economy have been affected the performance of Hilton.

Social and cultural factors : There are two purpose of hotel business i.e. business and happiness and Hilton provides services and facilities to cope with living standard of all the customers. Hilton,s target market includes the everyday business travellers family vacation and leisure travellers (El-Said and ElMakkawy, 2018). Due to this lifestyle is changing among different cultures the taste of people also changes and Hilton always take care of people's need and consumption power of them . Many travellers have different priorities so hotels have to include visits to theme park, beaches, shopping, dining or other recreational tourism. Hilton have different facilities such as spa. Resort, park and many more which help to attract many customers and help to increases its profit as well as revenue.

Technological factor : with the change in life style of customer, the most important thing in global tourism industry is technology or convenience for the customer. Hotel needs to access the internet and all the hotel room are equipped with the internet access so the other people around the world can contact easily on the television or radio. Hilton always uses its best technological factors in order to increases its customer base (Johan, Baga and Asmara, 2018). Recently it uses digitalization key which is operated by customer's smartphone and it is locked and unlocked by that phone only which is the biggest achievement for the hotel industry. Hilton does not updated all the items related to website that is the biggest threat for it.

Legal factor: Due to terrorist attack in UK, government banned in travelling in many countries that suddenly decrease the number of visitors in UK. Many programs had been approved in order to increase the number of visitors but it create negative effect on hospitality industry and the cost of accommodation and service which are provided by hotel is suddenly increases. As per the survey, more than 15 percent flights are influenced due to sudden travel ban in many countries and this affect travel and tourism sector a lot, even many visitors feel threat to visit foreign countries due to sudden implication of such rules.

Environmental Factors: Hilton take many initiatives in order to save the environment from other problem. It always uses pollution free products and consider some factors such as weather, climatic change and waste management system (Lin, 2016). Different markets of management system impact the profitability of Hilton hotel. Every country has its own rules and regulation related to environmental issue and Hilton always try to use healthy tax for the companies to help in renewable sectors.

CONCLUSION

From the above report it is concluded that to run a company in positive direction it is necessary to use strategic planning. These planning help to achieve all the targets and aim. Through this report it is also concluded that Hilton face many factors while formulating strategic plans. The report also present its strength, weakness, opportunities and threat that help to assessing the position in market. Through PESTLE analysis, the report reflect the vision, mission and its objective which help to achieve the targets and mission that take the business into further level of success. The report also tells the current position of Hilton and how its political and economical factor affect the external environment of business.

REFERENCES

  • Peng, M. W., 2017. Cultures, institutions, and strategic choices: Toward an institutional perspective on business strategy.The Blackwell handbook of cross‐cultural management, pp.52-66.
  • Leonidou, L. C. and et.al., 2017. Internal drivers and performance consequences of small firm green business strategy: The moderating role of external forces.Journal of Business Ethics.140(3). pp.585-606.
  • Bohdanowicz, P. and et.al., 2017. The external environment for tourism, hospitality and event organizations: the macro context.Strategic Management for Tourism, Hospitality and Events.41(7). pp.805-25.
  • Das, M. and Rangarajan, K., 2017. Corporate Sustainability as a Business Strategy in SMEs-A Literature Review in the Emerging Market Context.
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