Student Name:

Student ID :

Unit/Module :

Programme :

_______________________________________________________

Nelson College London

1|Page
 Hospitality
Management

Content

2|Page
s
Introduction:................................................................................................................................4

LO1..................................................................................................................................................5

Analization of the impact and influence of the macro-environment on a hospitality

organization and it’s strategies after applying adequate framework...........................................5

LO2..................................................................................................................................................8

Analization of internal environment and capabilities on the basis of a hospitality organization

after implying adequate framework.............................................................................................8

LO3................................................................................................................................................13

Evaluation of the competitive forces of a market sector for a hospitality organization after
implying Porter’s Five Forces model........................................................................................13

LO4................................................................................................................................................16

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

Conclusion:................................................................................................................................22

Bibliography..................................................................................................................................23

3|Page
Introduction:
In the hearthstone of the business hospitality industry is always cherished for its contribution and
sophisticated business strategies. This is the era of globalization and the business atmosphere is
becoming more competitive. It is a bit hard to hold the constant success of a particular sector like
the hospitality industry. Yet the hospitality industry is progressing with its success like sparkling
star in the hearthstone of business. As a consequence of over changing world, they also have to
count some impacts. This assignment will consider Holiday Inn, a brand of the renowned hotel
brand. The consequences of the macro environment on Holiday inn will be discourse by
PESTLE analysis. The interior aspects will be analyzed with the help of SWOT and Value Chain
analysis. Furthermore, Porter's Five Forces model will help us to demonstrate the competitive
potency of the hotel industry. This assignment will provide a vivid concept of executing
calculated business plans of the hospitality industry.

4|Page
LO1

Analization of the impact and influence of the macro-environment

on a hospitality organization and it’s strategies after applying
adequate framework.

Holiday Inn is a UK based brand of hotels which is conducting it’s hospitality business
worldwide. It is the world's 3rd most popular brand of hotels. Especially Is holds huge popularity
in The United States. Though the brand has a huge demand and potential positive aspects of
success, it is also under the binding of the business environment. In short, the business is affected
by macro environment materials. To enhance the productibility and efficiency of the overall
business strategy of Holiday Inn, analyzing the impact of the macroeconomy on their business is
an effective way. PESTLE analysis is a congruous method of analyzing the impact of the macro-
environment on business. There is a PESTLE analysis provided below as an analysis of the
impact of the macro-environment on business:

 Political: There are multiple aspects of the business which are affected by the political
environment. There are many rules and regulations which are created by ruling political
parties directly affect businesses like Holiday Inn. Besides, changes caused by these rules
indirectly make a changing business environment for these organizations. For example, If
the ruling government party of the United Kingdom enforces to increase the tax bound
for the hospitality industry that will eventually make a considerable amount of change to
their way of pursuing strategies and conducting business. Brexit has been made for the
betterment of the united kingdom in many aspects. Yet that will impact Holiday Inn both
positively and negatively.

5|Page
 Economic: When the economy is greater, the business will be better. Economy
controls the market, consumer incomes, demand according to ability, and many more
fundamental aspects of the business. So it is vivid that no business can conduct business
effectively its economic stability is fragile. Hospitality business like Holiday Inn is not a
basic service. To clear that concept, If we think to start an elite hotel business like
Holiday Inn in a region where people can barely manage their basic needs like food or
shelter, It is almost impossible to even predict a fruitful form of the business. Brexit is
making a large change in the economy of the United Kingdom. Almost every economic
wing including the stock market will be affected by this and impact individually on every
kind of business.

 Social: Social environment is an amalgamated form of socio-cultural influences and

psychology of potential consumers. Everything in this world needs a suitable place to
grow. Business is also under the bound of needs. Extensively, Businesses require a place
where the potential consumers need or show interest o the service the businesses are
providing. People never accept the services or products which are inappropriate to their
culture or way of thinking. Holiday Inn could never go this far if the people of the area
where they are conducting their business had no interest in their service or the service
does not go with their expected consistency with culture.

 Technological: There is a contestation of technology all over the world. The world is
changing overnight due to upgraded technology. Technology is developing every sector
of business as well as the hospitality industry. High technology takes the way of
providing service and the quality of providing service to another level of standard. Most
of the people nowadays act apathetic to the old school way of service. Holiday Inn was
formed with a motto of providing elite and standard service so they pursue the strategy to
compete with the technological environment perfectly.

6|Page
 Legal: Legal procedures and bindings directly affect the activities of business. Political
environment is related with this. To execute a legal formation or law creation, political
parties play the most vital role. So the ideal political environment creates an effective and
friendly law and improper political environment acts contrary. If a law is created that is
auspicious to the business that will eventually affect the business of the Holiday Inn. On
the contrary adverse law creates barriers.

 Environmental:. Environment is one of the biggest prior to run a business. To execute

sound business activities of Holiday Inn, the environment where the business exits should
be compatiable. Particular type of business requires particular type of environment. An
industry fulfill its needs and resources from the environment. Likewise Holiday Inn
should have the positive influence of the environment which creates more enthusiasm to
travel or more compatiable travel opportunity among consumers. That’s why choosing
the environment of the hospitality industry wiswly is considered fundamental. So it is
vivid that businesses like Holiday Inn have impacts and influences of environment.

7|Page
LO2

Analization of internal environment and capabilities on the basis of

a hospitality organization after implying adequate framework.

The internal situation of an organization is as much important as the external situation. It has
considerable impacts and influences on the business organization. So an apposite analysis
regarding the internal environment can help the organization pursue a more effective strategy to
make a good stand in the business world. To illustrate the best analysis of the internal
environment of Holiday Inn using SWOT analysis and Value Chain framework is discourse
below:

8|Page
 Strengths:
Strength refers to the term of an organization's rigidity.
1. Holiday Inn provides a modern and sophisticated service according to consumer
needs.
2. Holiday Inn has 1,186 hotel compounds and the number is huge compared to
other hotel brands.
3. Holiday Inn has a reputation among both domestic and international consumers.
[ CITATION How20 \l 1033 ]
4. Holiday Inn is conducting its business worldwide so it is diversifying the risk of
the organization.
5. Holiday Inn is highly concerned about the relation between organizations and
investors. So investment flow is fluent here.

 Weakness:
1. Most recently some incidents regarding customer security occurred a few days
back. Hackers Broke in into its system and affected 1,200 of its franchisees. It put
a strain on its reputation.
2. Holiday Inn in Birmingham was accused of low maintenance of hygiene
standards. Hygiene standard affects the demand a lot.

3. As they conduct business in multiple regions, there was some clutter.

9|Page
 Opportunities:
1. Holiday Inn is taking initiatives to expand its area of business towards Germany
which creates an effectual probability of prosperity.
2. The partnership dealing between Manchester Airport City and Holiday Inn about
investing on building more 280 rooms is a great opportunity. Furthermore, the
same kind of dealing is on the pipeline the Luton Airport.
3. Atlas Hotels, and Somerston Capital fund are great investors towards expanding
the business of Holiday Inn.
4. It is pursuing the strategy of going on with high technological service what
creates more demand.

 Threats:
1. Greatest threats toward running a sound business are competitive fields of
business. Premier inn, Travelodge, Comfort inn, Fairfield inn are great
competitors.
2. Consumers pose more demand for quality service at a low price, many
competitors are pursuing these tactics to drag potential customers.

10 | P a g e
BCG Matrix of Holiday Inn:
The full form of of BCG matrix is the Boston Consulting Group growth share matrix. It is a
collaborating planning tool which utilizes graphical representations of an organisations product
and services in the way of deciding what it should pursue.

11 | P a g e
 Stars: Stars represent business units are products which have best market share and
hatches highest amount of cash. The financial services strategic business unit it is a star in
the bgx matrix of Holiday Inn hotel. It does it's activities in a market which represents
potential in the future holiday in earns sound amount of their income from this SBU.

 Question Mark: Question mark considers the brand which call for much closer
consideration.the local foods strategic business you need of Holiday Inn in is a question
mark in the BCG matrix. Nowadays local foods are attracting more attention of the
consumers this market also showing the potential of high market growth rate.

 Cash Cows: Cash Cows represent the most profitable brand and which has most
potential to provide as be as much as cash inflow possible. The supplier management
service strategic business unit is a a cash cow in the BCG matrix of Holiday Inn hotel.
This wing has attained magnificent amount of revenue to Holiday Inn hotel.

 Dogs: Dogs represent low market share likened two competitors which executes its
operation in a slowly growing market. The plastic bags strategic business unit of Holiday
Inn is dog in the BCG matrix. This unit is considered as a loss for the last 5 years.

12 | P a g e
LO3

Evaluation of the competitive forces of a market sector for a

hospitality organization after implying Porter’s Five Forces model.

To make an effectual stand in the competitive market, analyzing the competitive environment of
an organization is fundamental. The analysis concerns every ins and outs of competitive forces
intending to provide a highly compatible and sophisticated business atmosphere. To illustrate the
competitive forces of the hotel business for Holiday Inn, Porter’s Five Forces framework will be
applied below:

Porter’s Five Forces model of Holiday Inn:

Porter’s Five Forces model is a framework that was created by Professor Michael Porter. It
considers five forces and they are the Threat of new entrants, Bargaining power of buyers,
Bargaining power of suppliers, the threat of substitute products, and Industrial Competitors.
[ CITATION pau19 \l 1033 ]

13 | P a g e
14 | P a g e
The threat of new entrants:

The threat of new entrants analyzes the quantity of ease or difficulty for competitors to engage in
a marketplace. When the entry is easier the amount of risk for the existing organization is high
on the contrary difficult entry is a sign of less risk. Threat of new entrants should be considers
adequately. Competition of new entrants can create hardship in the way of hospitality business.
They try constantly to make an entry in the market with the various idea. Holiday Inn should
have this many strategical initiatives that make it harder to make newbie an entry.

Bargaining power of buyers:

This force analyzes the potency of consumers to provide them higher quality service or product
and lower price. Bargaining power makes consumers to demand best product or service at their
affordable price and that may become a barrier in the way of gaining sound inflow. So there
should be an effectual standard of services of Holiday Inn that makes consumers satisfied as well
as sound income. To make this force effectual the first thing to consider is the standard of
services. Holiday Inn has a great standard on its elite services. So that meets customer
satisfaction and make them not to intend about bargaining.

The threat of substitute products:

The threat of substitute products is prominent in the way of conducting sound business. The
threat of substitute products refers the similar products or services at a more reasonable or
attractive price in the market that makes the providing services seem more costly. As a
consequence, the consumers of the services pose apathy to the providing service and switch their
source of getting similar service. Eventually, this makes lose the consumers. Holiday Inn has a
great number of competitors who are trying to convince consumers that they provide the same
service at an attractive rate. Here Holiday Inn pursues the strategy of manipulating the
consumers through marketing and many more activities.

15 | P a g e
Bargaining power of suppliers: In the hotel business industry the bargaining power of
suppliers is lower than in other industries. The bargaining power of suppliers considers the
capability of increasing price supply products. The organization should keep this power of
suppliers as low as possible. Switching suppliers may cause huge costs. So organizations should
control the suppliers rather than change. The labor and trained staff are also considered as
suppliers of the hotel industry. Besides many parties supplies raw materials. Holiday Inn should
pursue an effectual strategy to balance the bargaining power of suppliers.[ CITATION Por19 \l
1033 ]

Competitive rivalry:

To analyze the strength of existing competitors of an organization is the field of this wing. There
can be no organization without any competitors. Almost every segment of the business as well as
the hospitality business has a competitor in the way of conducting business. The hospitality
industry especially hotel business has more competitors comparable to others. Hotel business
provides services and ways of changing consumer thinking about service are easier. So there is a
constant trying among existing competitors about snitching consumers. Holiday Inn has
competitors like Premier inn, Travelodge, Comfort inn, Fairfield inn who are continuously
making market harder to conduct dominating the business. Here Holiday Inn has to stay
extremely concern about its competitors.

16 | P a g e
LO4

Applicaton of theories, concepts, and models, interpret and devise

strategic planning for a hospitality organization.

Holiday Inn is one of the most successful hotel brands in the entire world. It is conducting its
business successfully true competitive business environment. As a consequence of their great
strategies of conducting business holiday Inn in is now the third most popular hotel brands in the
entire world. Now they are concentrating on informing strategic panel planning Tu to make there
market share more effectual. The primary motive of pursuing strategic planning is to give their
organization more sophisticated and Powerful in the competitive market of the hotel industry.
There is also the intention of beating competitors, asserting sound cash flow, making brand value
more effectual, and dominating the market share of the hotel industry. Holiday inn is targeting
the group of potential consumers who shows apathy to their service because the price of the
service seems non-affordable to them. They want to make a change of this potential customer's
psychology to consider more about their providing services. Holiday Inn has adequate budget to
execute strategic planning. The strategy will be the discourse under the most effectual theories
and models. Here we are choosing porter's generic strategy and Ansoss's matrix model to
discourse their strategic planning. They are given below:

17 | P a g e
Porter’s generic strategy:

Porter's generic strategy portrays how an organization gains a competitive advantage through its
selected market opportunity. Porter's generic strategy considers 4 strategies.

The cost leadership strategy: The cost leadership strategy considers two facts. One is
increasing profits by decreasing costs. Another is increasing market share by charging lower
prices, while thriving market share. So the important fact that Holiday Inn should consider here
is making a reasonable profit that means the reduced prices should not affect the profits that
much. So the main concept of cost leadership strategy is earning average satisfactory profit while
reducing the cost of creating service or product and increasing market share. If Holiday Inn find
out the additional costs which has no relation with the standard of services and take initiatives to
cut those costs, they can easily earn more without compromising profit. They can also offer
reduced price than usual and gain advancement in the competitive market share.

18 | P a g e
The differentiation strategy: The differentiation strategy considers three fundamental
facts. They are:

1. Effective research progress and innovation

2. The efficiency of providing high-quality products or services.
3. The appropriate strategy of sales and marketing.

That means the target marketing should understand the expressing concept of offered
services or products of Holiday Inn. So it is a vivid advantage for Holiday Inn if they pursue
this strategy. Eventually, that will make them a more effective hospitality business
organization.[ CITATION Min20 \l 1033 ]

The cost focus strategy: The cost focus strategy considers a niche market. The targeted
market has reduced the existence of competition. Holiday Inn will offer products here at the
lowest possible price by reducing the cost of service or product production. Holiday Inn should
concentrate on kind of market where the risk of competition is adequate ans less than others.

The differentiation focus strategy: The differentiation focus strategy considers a niche
market. The target market has reduced the existence of competition. Holiday Inn will offer
products here which have the most unique features advantages compared to other products
offered by competitors. By following this strategy Holiday Inn’s service will get more
recognition among consumers due to their unique features and create a positive
impact[ CITATION Wik202 \l 1033 ]

19 | P a g e
Ansoff’s matrix:

The Ansoff matrix is a tool that is used for strategic planning. The tool gives a framework of
strategies to the management body of an organization considering future growth.[ CITATION
Wik203 \l 1033 ]. Holiday Inn’s future growth will be discourse under The Ansoff matrix tool
below:

Market Penetration: Market presentation is concerned about increasing sales of existing

products to the market by reducing prices to attract potential consumers. Holiday Inn does this
through comprehensive distribution promotional activities and acquiring competitors in the
market. Holiday Inn does the analysis about abundant cost which are not mandatory in order to
decrease the charging price as much as possible. Thus they execute Market penetration.

20 | P a g e
Product development: product development is all about the innovative idea. It works on
bringing new services a product in the market. Holiday Inn is concerned about research and
development and gathering information about competitor's products and establishing strategic
partnerships with other organizations to acquire access. Holiday Inn considers and evaluate
innovative idea which can satisfy more consumers considering the various needs. As a
consequence consumers get the most elite services.

Market development: Market development strategy is concerned about making an entry into a
new market by utilizing existing products to a different section of consumers and expanding the
field of business conducting area. Holiday Inn should targets consumers from different segments
who are not introduced to the services of the Holiday Inn and finds out the most potential way to
get their consideration. They do analyze the needs of new markets and modifies the service
according to that.

Diversification: Diversification is all about making entry to a new market with a new service a
product. It is one of the riskiest strategies because this strategy considers huge investment and
predicted concepts. Through diversification Holiday Inn can propose their potential consumers
new services with reasonable price. Thus they gain advancement towards marketplace. In this
step Holiday Inn’s responsibility is to take multiple kind of initiative and launch campaign in
order to introduce the previous and potential consumers to the new services.

21 | P a g e
A Suitable Strategic planning of Holiday Inn:

Holiday Inn should pursue the market penetration strategy from the Ansoff’s Matrix Strategy
framework. The market penetration strategy seems most suitable for the advancement for
Holiday Inn. There is a use of competition in the hotel business. Holiday Inn is facing constant
competition in the way of conducting business. There are a continuous flow of new customers in
the field of business and customers expect the best thing out of a reasonable price. To grab this
new customer's Holiday Inn should make their services at a decreasing price and assure the most
satisfactory services comparable to other competitors in the existing markets. This strategy is
known as market penetration strategy. By following market penetration strategy Holiday Inn,will
be able to get a positive mindset of potential consumersand thus they can penetrate the market.
This strategy will require Holiday Inn to concentrate on comprehensive distribution promotional
activities and acquiring competitors in the market.

22 | P a g e
Conclusion:
In the field of business, many incidents can affect business significantly. To ensure the highest
outcomes from organization analyzing of multiple segments like macro environment analysis,
SWOT analysis, PESTLE analysis, Porter's Five Forces analysis, BCG matrix, Porter's Generic
Strategy analysis Ansoff’s Matrix analysis can make an organization as a dominating
organization in the competitive market. From the assignment, we can see how Holiday Inn can
make a good stand in the competitive market through analyzing these aspects and they seem
fundamental.

23 | P a g e
Bibliography
Howandwhat, 2020. SWOT of Holiday Inn. [Online] Available at:
https://www.howandwhat.net/swot-analysis-holiday-inn/ [Accessed 27 June 2020].

IHG, 2019. IHG. [Online] Available at: https://careers.ihg.com/head-office-jobs/working-in-

sales-marketing-communications [Accessed 27 June 2020].

Mindtools, 2020. SWOT analysis of Holiday Inn. [Online] Available at:

https://www.mindtools.com/pages/article/newSTR_82.htm [Accessed 27 June 2020].

paulfoleyblogs, 2019. Paulfoleyblogs. [Online] Available at: https://paulfoleyblogs.com/michael-

porters-five-forces-of-competitive-advantage/ [Accessed 27 June 2020].

Porteranalysis, 2019. porteranalysis. [Online] Available at:

https://www.porteranalysis.com/porters-five-forces-model-of-hotel-industry/ [Accessed 27 June
2020].

Ukessays, 2018. Marketing strategies of Holiday Inn. [Online] Available at:

https://www.ukessays.com/essays/marketing/marketing-strategies-of-holiday-inn-hotel-
marketing-essay.php [Accessed 27 June 2020].

Wikipedia, 2020. Ansoff_Matrix. [Online] Available at:

https://en.wikipedia.org/wiki/Ansoff_Matrix [Accessed 27 June 2020].

Wikipedia, 2020. Holiday Inn. [Online] Available at:

https://en.wikipedia.org/wiki/Holiday_Inn#:~:text=Holiday%20Inn%20is%20a%20British,as
%20of%20September%2030%2C%202018. [Accessed 27 June 2020].

Wikipedia, 2020. Porter's generic strategies. [Online] Available at:

https://en.wikipedia.org/wiki/Porter%27s_generic_strategies [Accessed 27 June 2020].

24 | P a g e