Hilton Group Worldwide - Case Study Example

Hilton World wide Introduction Hilton Hotel is among the leading hospitality chains in the world. The luxury hotel was founded by Conrad in Cisco, Texas and is currently headquartered in Tyson Corners, Virginia. Hilton. Currently the Hilton Worldwide consists of over 3500 hotels that are spread in different countries throughout the world. The hotels exist in 80 different countries. According to a survey on its revenue in the year 2010, it was found that the luxury hotel chain experiences growth of 4% annually. The current operating revenue of this giant hotel chain is estimated to be about 9 billion dollars (Hummert, 2008) Hilton World Wide, formerly referred to as the Hilton Hotels Corporation is owned by Blackstone Group which is a private equity firm. The Blackstone Group owns several brands that include the Hilton Hotels and resorts (Johnson, 2004). This paper analyses the Hilton group of hotels with emphasis on the hotel’s marketing system, human resource management and supply chain. Human Resources Management The Human resource practices in the Hilton world wide have strong humanitarian ground embedded in it. The hotel HRM practices focus on recruitment, selection, training, and development and performance appraisal. Hilton Hotel is passionate about delivering an exceptional guest experience in its entire 3500 branches worldwide (Hartlen, 2004) Therefore the Human resource department ensures interest by ensuring that the employees do the right thing at the right time. In addition the luxury hotel chain trains its employees to be leaders in the hospitality industry as well as their communities. Team work is greatly encouraged within the hotel chain. The employees are always encouraged and motivated to be team players in their day to day task. Even though team work is encouraged, the workers at Hilton are also urged to own their actions and decisions as they partner and work with colleagues in the hotels. At Hilton employees are the most precious resource (Hartlen, 2004).The Human resources department identifies its employee target, collects their résumés and then carry out screening and evaluation of the collected documents Interviews which entail work simulation tests as well as psychological tests are then done to ensure that it gets the suitable candidate for vacant positions. Due to the nature of business that the company operates and its operation in different cultures and countries, the group recruits most of its candidates from the host countries. This is done so as to ensure that the hotels are able to fully satisfy the needs of its clients in a particular country of operation. (Edward & Ewen, 2004). Training and development is an important aspect of the human resource practices at Hilton world wide in its various branches and franchises (Johnson, 2004). The human resource departments in the various branches conduct training needs analysis in order to identify the gaps between an employee’s actual performance and the expected performance. During the analysis, the focus is laid on the specific needs of each of the employees (Edward & Ewen, 2004). After the analysis has been done, the employees are then trained on various aspects of their duties in order to increase competitiveness, prepare them for promotion and to increase their value in the job market. In order to remain competitive in its various countries of operation, Hilton hotel tries to ensure that employees always do what they are hired to do (Iervolino, 2004). One of the main ways through which this is achieved is by total reward. At Hilton, employees are rewarded on a regular basis to ensure that they are ever motivated and do their task or jobs as expected. The rewards given to the employees are determined at the branch level in all the hotels. Marketing Just like any other business or enterprise, Hilton hotel values marketing and employs various strategies in order to maintain its client base and to be able to win over more customers and visitors. The group uses several marketing strategies to achieve its marketing goals (Johnson, 2004). The first strategy is target marketing in its various branches. Target marketing refers to the process of dividing the entire market into smaller segments and sections and then concentrating on a particular section or segment. This strategy is used because of the fact that the hotel operates in various markets in different countries and therefore it is normally hard to treat the entire market as a single unit. In this strategy all marketing efforts are concentrated on the single segment that has been identified and picked. (Iervolino, 2004). The hospitality industry where Hilton hotels operate experience various types of travelers that include business, family holidays and leisure. The hotel therefore, targets all the different types of clients and ensures that their diverse needs are satisfied and fulfilled. For example, for those who do business, the group offers conference facilities and meeting rooms to enable them to carry out their business needs in the hotel. The group develops different products, services and facilities depending on the needs of the clients and the target market (Iervolino, 2004). Market positioning is also widely used in the various Hilton worldwide hotels. Market positioning is a process whereby the company creates a certain impression on the minds of its clients and customers (Murphy & Cleveland, 2011). This is done by getting feedback from the clients so as to know their needs. Hilton hotel clearly knows the needs of its clients and therefore the management strives to make strategies and plans that are aimed at fulfilling the demands of the clients. This strategy involves regular monitoring of the products and services in order to gauge their performance in the market. Hilton monitors feedback from its clients in the different hotels where it operates and changes are normally done on suggestions by the clients. Globalization has forced the hotel to adapt its services and products to the needs of the customers and clients. The key channels of marketing at Hilton worldwide are direct adverts and the internet. The group believes that the preference of the customers depends on the location of the hotels and it therefore opens its branches in locations that are deemed to be preferred by the clients (Murphy & Clevelen, 2011). Moreover, Hilton gives exceptional services to its clients. This is in addition to the rewards and benefits that are given to the members of the hotels. The services offered by the group are carefully implemented so as to attract as well as retain clients and customers. Some of the products that are offered by this multinational include honeymoon packages, conference facilities, bars and other room amenities. Hilton Group of hotels has been known to act as the cost differentiator in the industry. The group has competitive process compared to some of its competitors in the hospitality industry. The rates of the products and services vary according to location. The rates normally include the applicable taxes.For example, in the UK, the price for a room in the Canary Wharf Hilton hotel is £99 whereas in the Hilton hotel at Wembley the price starts at£45 per night (Hilton worldwide, 2010). Promotions also make an important aspect of marketing at Hilton. Considerable amount of resources is normally spent by this hotel promotes and online marketing. Online marketing has been widely used by the hotel due to the wide market that it serves, as well as due to the fact that the hotel exist in over 80 countries. Public relations are very important and it therefore ensures that it gets involved in various community programs through sponsorships (Hilton worldwide, 2010). In order to help the clients and customers save time and money, the faculty has heavily invested in its web check in facility that allows clients to book and pay for rooms via the internet. Supply chain management The Hilton hotels have a department that is specifically tasked with handling supply issues. The supply Management Division offers comprehensive as well as value based supply management solutions in the industry. In order to maximize the purchasing power, the division consolidates the supply needs of the Hilton hotels as well as the third party properties (Miranda, 2004). The Supply management division is therefore crafted to be a one stop sources that bring together supply management solutions by linking with suppliers. This is done so as to meet and maintain the operational standards and specification o the Hilton brand. According to Miranda (2004), cost effective and transparent supply chain at Hilton has made the luxury hotel giant to make profits over the years it has been operational. The Company is always looking for the key issues in its supply chain in order to facilitate integration of the solutions into the chain. This is done so as to manage the risks that are involved in supply chain as well as to create increased value in its supply chain. Hilton normally looks for methods and avenues of establishing as well as enforcing supplier rules of engagement and code of conduct. It establishes, measures and enforces performance obligations to the suppliers and also negotiates vital contract provisions with various suppliers in order to help protect the Hilton brand and to remain relevant in the hospitality industry. Hilton has changed its procurement strategy so as to combine buying into national contracts and using local providers (Armstrong, 2006). This tactic has helped to streamline the operations of the hotel in various countries. It has also built a good relationship with its suppliers with the intention of getting good deals and makeup with its distributors. Moreover, the hotel giant has made changes internationally in its various branches and franchises so as to integrate international procurement. This has made it gain control over the whole supply chain (Johnson, 2004). Supply diversity is another important aspect of the group’s supply chain management. Diversity has been used so as to ensure that the supplier base is diverse just like the client base and the market where it operates. The procurement process has been diversified in all t Hilton hotels and franchises by integrating the supplier diversity efforts in into the entire procurement process. A second tier diversity program has also been implemented so as to encourage the main suppliers to be part of the effort to cultivate diversity in the supply chain. It therefore provides education on diversification to its suppliers so as to be able to increase the total percentage of diverse suppliers (Johnson, 2004). Hilton Worldwide has been able to expand its supply chain throughout the world while also increasing the level of sophistication in logistics management. The supply chain management strategy that is used by the business allows for transparency and access top supply chain data by means of a cloud supply chain. It has moreover used tools that facilitate tracking and tracing of its various products for government regulations. The supply chain has been known to play an important part in the groups CSR (Johnson, 2004).It has therefore integrated CSR into the supply chain practices so as to be able to sustain the Hilton brand standards In 2000 Hilton group was reported to lag behind other hospitality companies in terms of supply chain management. However, the Hotel has since redesigned its supply management process and this has made it gain ground. Procurement in the hotel is managed through its Beverly Hill office as well as other regional affiliates (Lengnick-Hall, & Lengnick-Hall, 2007). The group buys into national contracts for various brands, but also engages local suppliers when deemed necessary. Deals are directly cut with the suppliers followed by negotiating of markups with distributors who are tasked with warehousing and delivery. This allows for control of the overall supply chain. Through effective spend management, the group is able to control and monitor what the various branches and franchises to buy and pay for so as to ensure compliance with the company principles and standards (Gilliana & Watson, 2004). Standardization of purchase has also allowed Hilton to maintain consistent product quality in its various locations and branches (Lengnick-Hall & Lengnick-Hall, 2007). The supply management system is extended into all the departments so as to ensure that consistency is achieved for all the products and services. References Adair, J. (1988) Effective time management: How to save time and spend it wisely, London: Pan Books Armstrong,M. (2003), A Handbook of Human Resource Management Practice,9th ed. London:Kogan. Armstrong,M(2006),A Handbook of Human Resource Management Practice,10th ed. London:Kogan. Edwards, M and Ewen, A, (2004). ‘How to manage performance and pay with 360-Degree feedback’, Compensation and Benefits Review. Frolick, M and Ariyachandra, T. 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