Strategic Analysis of Regent Hotel Singapore - Research Paper Example

Strategic Analysis of Regent Hotel Singapore Introduction Regent Hotel Singapore is within a walking distance to Orchard Road and Botanic Gardens. It is the oasis of cool, providing visitors and guests with the epitome of comfort besides anticipatory services. The hotel has a dynamic décor and high-class museum keeping quality Asian pieces. It is a private and exclusive haven for international business as well as leisure travelers. As an excellent hotel, it is very good considering the fact that it provides a four seasons quality of services. It has big rooms fully equipped for guests. Five Forces Analysis Intensity of Competitive Rivalry For most industries, the Intensity of rivalry among established firms is the major determinant of the competitiveness of the company. For example, the firms that existed before Regent Hotel were a major threat. Major potential factors that expose an industry or a company to overcome such challenges may include; a sustainable competitive advantage through innovation. For this case, Regent Hotel established renewable sources of energy, which indeed was a great challenge to existing industries. However, Porter argues that competition between offline and online companies is also a factor need for consideration Risk of entry by potential competitors Secondly, Porter comments profitable markets that yield good profits will attract new industries. This results in many new competitors, which eventually will decrease profitability for all firms in the industry. The following factors can have an effect on how much of a threat new competitors may pose: the existence of barriers to entry for example patents, rights, etc. The most attractive segment is one in which entry barriers are high and exit barriers are low. Here, new firms can enter and non-performing firms can exit easily due to high competition. The following factors have indeed helped Regent Hotel, as a company to sail through government policy not affects Regent Hotel to expand its business. Bargaining power of suppliers The bargaining power of suppliers can also called the market of inputs. All suppliers of raw materials, components, labor, and services to the firm can be a cause of power over the firm when there are few substitutes. For example if you are making loaves of breads and there is only one person who sells flour, then you have no substitute but to buy it from them. Suppliers may refuse to work with the firm or charge excessively high prices for unique resources due to the following potential factors. For instance, Supplier switching costs relative to firm switching costs or degree of differentiation of inputs. Threat of substitute products The existence of products by different companies like Gmail and Yahoo increases the propensity of customers to switch to other alternatives. For example, a customer may consider Yahoo a substitute for Google, whereas Gmail is a competitors similar product. Increased marketing for internet might shrink the pie for both Google and Yahoo, whereas increased Google advertising would likely grow the pie. Bargaining power of customers (buyers) Scholars describe it as the market of outputs. In other, it can be discussed as the ability of customers to put the firm under pressure, which in turn affects the customers sensitivity to price changes. Companies like Google can take measures to reduce buyer power by implementing a loyalty program. This can be achieved through the following factors; Buyer concentration to firm concentration ratio and degree of dependency upon existing channels of distribution as well. Buyer information availability and bargaining advantage, particularly in industries with high fixed costs are very much effective. External Analysis PESTEL Analysis First, the top management of RHS grouped the consumer food products market in Singapore into four. The segments were the young generation, hobbyists, high-income families and the business users. The company targeted the high-income consumers because from them bigger profit margins could be realized. This group has various characteristics among them large, one-time purchases of goods whose durability was high. Secondly, high quality televisions are some of the products that were common to these customers. The brand image guides the performance of decisions made by this group. Statistics had shown that these consumers preferred associating with established brands. The result of this was that the company experienced twenty percent increase in sales from this group. This was more than the overall increase by the whole company. Thirdly, leadership practices adapted from the private sector challenges public administrators to foster environments that encourage creativity among public sector employees, improvement in work processes, and creation of constructive workplace environments for employees and the public. The bottom-line is to serve the customers in the most efficient way. The fourth gold of all managers at Regent Hotel is to make sure that they are adopting leadership styles that encourage their subordinates to serve the community in the most productive and efficient manner. This becomes possible if employees consider themselves part of the organization. This raises their willpower to succeed. Internal Analysis Hotel Resources and other Advantages Positioning and distribution Regent Hotel always endeavored to make sure that customers put great value on their products. Most goods sold to end consumers using retailers. LCD monitors had to be sold directly to consumers since they became popular. Goods with real value were produced so that they capture customer interests. RHS however, used special stores such as future shops and Best Buys to release their products to the markets. Pricing The company categorizes its products into two. Consumer food products that include food products are on one hand and the services such as outside catering and accommodation on the other end. The basis of this strategy takes two dimensions. It puts into consideration the interests of retailers and the customer. The aim is to maximize sales volumes against the profit margins. RHS uses prearranged food transfer prices. The accommodation divisions considered price-valued, Conventional services and accommodation were premium-priced. Other products were categorized as mid-range. In the Information Technology division, outside catering recorded impressive records because of its fame and increased demand. Promotion RHS used various marketing mixes to promote its different brands. Most of them however, depended on the happenings in the US and the European market. The focus was to make sure that both current clients and target clients got information about products. Although the company profited from spillovers of advertisements, it became difficult to get tailor-made adverts for its international market. High definition television sets and cable networks in their premises were flagship projects specifically for Singapore. Products Regent Hotel produces a range of products under its brand. Accommodation services, food services, outside catering, conferences, and holiday resorts. The company has put together a team of professional experts to produce these goods. The designers segment the products to suit dynamic markets while at the same time keeping the quality high. Consumer food products are priced to fit the disposable incomes of people in various cadres. VRIO (Value, Rival, Imitate, and Organization) Structure Rare? Costly to Imitate? Exploitable by the Organization? Competitive implications Value Strengths or Weaknesses No - - No Competitive Disadvantage Below normal Weakness Yes No - to Competitive Parity Normal Strength Yes Yes No Temporary competitive advantage Above normal Strength and distinctive competence Yes Yes Yes Yes Sustained competitive advantage Above normal Strength and sustainable distinctive competence SWOT Analysis Strengths Regent Hotel Food products own the Regent Hotel Food products Singapore. The hotel headquarters are in Singapore. Most of its raw materials come from Korea and US. The duties of the company include advertising and promotions, Sales force management and Customer service. The company uses various marketing mixes in all this. Product pricing is one method that it needs to improve. Weaknesses Challenges of Regent are associated with company products and their distribution. New developments had indicators of abolishing low-end products that were valuable in Singapore. The challenge from Park was that these goods formed the primary source of profits for RHS. In the same breadth, a challenge was whether RHS would change its distribution style to emulate Amara. Opportunities The hotel needs to add more of the products and services in this category. This would make the company expand its idea of profits. It would maximize both sales volume and profit margins. The company also uses its positioning and distributions as another mix. Adopting a wholesome approach that will engage in selling goods in bulk and to individual consumers would open avenues for increased profits and customer contacts. In using promotion as a marketing mix, the company should develop specific promotional activities to suit their international markets. RHS finally, uses its products as another mix. The company must increase range of products it produces. The company should learn from some of its flagship products that have done well in Singapore. This area will make RHS venture into new market areas in addition to holding tightly in areas they fully control. Threats As much as the system had merits, the challenge was that, the system was already associated with the rival. The third problem relates to pricing. A choice had to be made between retaining the existing retail prices and increasing them. In adopting the former, RHS would have to find other sources of funds for its repositioning efforts. In the latter, the company faced the risk of losing clients to competitors. Strategic Options The mechanics’ orthodoxy Success in any organization depends on how its leadership treats the human resources. This is because employees are central in all departments within the organization. Proponents of the mechanics’ orthodoxy demonstrated the value of human capital in their research by leaving it out. Their research proved that achieving desired success in work productivity for public administration organizations was not possible without considering the human element (Rosenbloom and McCurdy 2006). The vision goes along good service, great shower, and nice location. It is a perfect stopover for people visiting Singapore. The hotel contains four hundred and forty well-appointed rooms with suites. It also has six dining alternatives in addition to above reproach services. The hotel’s Basilico restaurant is an award-winning catering area dealing with the Italian cuisine. Clients now consider it a destination eatery. Transformational and Transactional Processes Management in public administration needs to apply varied leadership styles including transformational and transactional in the process of showing the relationship between the management and employees. These styles influence both situational gold and the followers’ behaviors. Waldo’s Good Life theory centers on the idea that public administrators should utilize scientific leadership styles to create better industrial and urban societies that help in resolving public conflicts in a technical manner (Rosenbloom and McCurdy 2006). The progressive movement also supports application of scientific methods because they believe that scientific methods help to influence public administrators to create policies that help administrators in making tough decisions (Shapiro and Schroeder 2008). This is what they consider as lacking within the administration of public organizations. The solution according to them lies in using the scientific methods of leadership. Scientific methods are effective tools applied when convincing politicians to change outdated policies in the process of enhancing community development. However, applying scientific methods of leadership on employees is not very effective because peoples’ behaviors are unpredictable. The hotel produces goods with real value produced so that they capture customer interests. RHS however, used special stores such as future shops and Best Buys to release their products to the markets. The gold of every public administrator makes sure that he or she is practicing leadership styles that encourage employees to work towards optimum productivity. This is because employees understand that their services are essential to both the public and the organization. Giving employees of organizations due consideration that includes fair treatment is a source of motivation to them. Taking Advantage of Opportunities To arrive at a progressive decision, Regent Hotel had to consider two other issues. First, RHS was enjoying advantages of advertisement by SEA that had increased advertising coverage following a decision to increase expenditure in that business division. Secondly, the head office was planning to sponsor global events such as the Olympics. Recommended Strategy Transformational and Transactional Processes The Design of the Administrative structure borrows a lot from methods of administration practiced by organizations in the private sector. These leadership styles give preference to a leaner but efficient government (Rosenbloom and McCurdy 2006). Leadership practices adapted from the private sector challenges public administrators to foster environments that encourage creativity among public sector employees, improvement in work processes, and creation of constructive workplace environments for employees and the public. The bottom-line is to serve the customers in the most efficient way. The second gold of all managers at Regent Hotel is to make sure that they are adopting leadership styles that encourage their subordinates to serve the community in the most productive and efficient manner. This becomes possible if employees consider themselves part of the organization. This raises their willpower to succeed. Through this, the success of the organization becomes inevitable. The supervisory role of the management within public organization becomes simple. Conclusion In conclusion, the human element within public organizations plays a very important role that helps public administrators create a productive agency that serves the community in an efficient manner. The success of any organization depends on the way human capital is handled by the leadership in both public and private organizations. Public administrators must develop leadership styles that consider human emotions and feelings as being crucial in decision-making processes. The company also uses its positioning and distributions as another mix. Adopting a wholesome approach that will engage in selling goods in bulk and to individual consumers would open avenues for increased profits and customer contacts. In using promotion as a marketing mix, the company should develop specific promotional activities to suit their international markets. RHS finally, uses its products as another mix. The company must increase range of products it produces. Proper leadership styles give opportunities to employees to become innovative and creative. They also develop employee skills that serve as a source of motivation. This is supposed to result in better working environments within public organizations. Bibliography Rosenbloom, D. H., & McCurdy, H. E. (2006). Revisiting waldos administrative state constancy and change in public administration. Washington, D. C: Georgetown University Press. Shapiro, S. A., & Schroeder, C. H. (2008). Beyond Cost-Benefit Analysis: A Pragmatic Reorientation. Harvard Environmental Law Review., 32(2), 433-502. Read More