Impact of Differences in Culture on the Global Expansion of a Company in the Hospitality Industry - Essay Example

?TOURISM The current investigation looks into some strategies that apply to the hospitality industry, focusing on management for those firms with cross-cultural operations in the multinational business environment. The main assumption of the report is that strategies should be consistently culturally sensitive to diversity, and customer-centric in a way that shows respect for integral cultures. For example, a hotel chain operating multinational branches can establish inroads into a frustrated customer base beginning with its expansion into moderately priced hotels, which many travelers find too small or otherwise unaccommodating. The company can research its customer base to find their biggest complaints and work to serve them so that they would enjoy coming back to that hotel. “Firms compete and create value in differing ways: transforming inputs into outputs solving clients problems and mediating between customers in a value network, and there are implications for critical activities, drivers and strategy” (Weaver, 2001). Hospitality management strategy can also employ customer segmentation to identify those groups who are most likely to stay at a moderately-priced hotel and convince them that the main sources of their previous dissatisfaction at other chains would be remedied at the current firm. “When determining the strategic objectives pursued by their collaborative strategy, international hotel chains should make no compromises to the standards of the product they offer and/or to their product positioning, but stay focused on the strategic objectives determined in advance” (Fyall and Spyriadis, 2003). In looking at cross-cultural strategies, programs are not necessarily geared towards helping businesses keep payroll costs at a minimum and job security a prize, and this situation often works out in reality, along with an insidious sort of pity on the part of the business that seeks to sidestep the bottom line. Discrimination may also be a problem in a scenario in which inhabitants of the firm’s native country are sent into expatriate conditions. However, individuals can influence the system at large by creating microcosms in which diversity is encouraged and respected and cultural equality is the rule rather than the exception. “The way managers think about diversity has evolved and changed over time. In the 60s and 70s, EEO laws focused managers’ attention on the task of eliminating race and sex discrimination in the workplace… managers began to understand the importance of creating a workplace that is great for everyone” (Hellriegel et al., 2005). In the case of intercultural concepts, the vision or guiding principle or goal is looked at in an inclusive way. That is, the concept is inclusive to the culture in this construction, and bears communication across cultural barriers and boundaries to a greater understanding of the positive side of communication. Multicultural signifies a respect for diversity and individuality in the organizational environment, rather than a platform that is based on assimilation or the unitary non-acceptance of cultures other than one’s own. Organizational culture, also defined in the context of the hospitality industry, is more about the shared vision of individuals within a certain organizational environment, which is often supported by the environment itself. “We have unlimited demand out there. There are so many companies out there on an assignment basis. We're finding out the number of stays over seven nights at hotels to see if they would stay in corporate apartments if they knew about it” (Walsh, 2001). Remaining adaptable to new circumstances is an important part of cultural integration. Cross cultural management shows, the most effective organizations are those that are able to create a strong internal culture that unites rather than divides the employees and managers in the organization. But this is not always easy to achieve in reality, because many individuals differ in their goals and expectations, and cannot be reasonably assumed to share in this organizational vision. “The ability of management to understand their customers is an important part of any successful business and this is particularly true within the hospitality industry. Globalisation has created a demand for international hoteliers to meet the needs of customers from different cultures” (Lockyear and Tsai, 2004). A business like a hotel chain is a large organizational structure, and within this structure, there may be individuals who are inspired to behave cross-purpose for any number of reasons. Many of these reasons have to do with the goals of the individual. For example, if a person views monetary gain as their main purpose, they may be willing to put ethical issues aside in order to reach their goal with maximum efficiency. They may not pay attention to any code at all. Further complicating the situation, to put back the international element, what is considered ethically neutral in one country may be totally unethical in another, and vice versa. “Even if there were widespread cross-cultural agreement on the normative issues of business ethics, corporate ethics management initiatives which are appropriate in one cultural setting still could fail to mesh with the management practices and cultural characteristics of a different setting… multinational businesses risk failure in pursuing the ostensible goals of corporate ethics initiatives” (Weaver, 2002). In other words, corporate ethics may be something that is culturally relative. Overall, the international marketing scenario for a company like a hotel chain could be said to be a gradual cornering of the travel business with outreaches into all involved demographics, eventually including assisted living communities, luxury hotels, and online travel options. The target market of the company is seen to have grown from those craving one stop to almost every demographic of traveler, from those utilizing ret- stops like Howard Johnson’s to those staying at the Ritz-Carlton. In each demographic, the hotel should attempt to deliver value and heighten customer satisfaction so that more repeat customers will be drawn to the company. “There is good news for those seeking jobs in hospitality: The industry is growing. As the national economy continues to recover, more people will require the services of the hospitality professional” (Hall, 1995). The interrelatedness of various targeted demographics also ensures that a repeat customer who, for example, stayed at a moderately-priced hotel on a business trip, will be more likely to use hotel online reservation services for their next family vacation. Although this is staying within the same demographic, it does show the interrelationships between segments; a more demographically varied example could include the fact that a hotel covers both the metaphorical high and low roads of travel, from luxury suites to rest-stops. The base of interrelatedness for a hotel chain’s segments is emphasized by the common theme of travel. Therefore the chain should divide this overall travel market into groups of consumers who have different needs during their periods of transience. By doing so, the corporation is recognizing that everyone has different needs, and is appealing to a wide variety of travelers. In an age of increasing standardization, customers need to feel that they are being given unique attention, no matter what their cultural background. Differences in language and culture can significantly impact movement towards global expansion of a company in the hospitality industry. But these differences also highlight the need for global research into markets like Europe, as a company that enters a foreign market like Sweden or Germany unprepared and unversed in its language, regulations, union procedures, common reimbursement plans, and culture faces many potential difficulties and obstacles. For example, in the US, Chevrolet introduced the Chevy Nova in Latin America without considering that “no va” means “does not go” in Spanish, and suffered some amount of embarrassment. Therefore, it is very important for a organization to consider differences in language and culture in its global research. “Around the world, corporate codes of conduct on human rights, labor standards, and environmental performance are proliferating. These codes reflect the growing pressure being placed on firms by nongovernmental organizations (NGOs), activist shareholders, and the portfolio managers of "socially responsible" investment funds” (Kapstein, 2001). Today’s point of view stressing ethics and accountability “argues not only that corporations are moral agents, but also that their moral agency has made the business world of the late twentieth century and of the coming century different from anything of preceding epochs. It is, in his argument, an agency of great potential danger and of great potential benefit, one in terms of which we can address nearly every ethical problem of business” (Kerlin, 1997). External circumstances also affect the hospitality industry in general: “Synchronized economic slowdowns in Asia, Europe and the United States, the three engines of global commerce, have decimated international trade” (Kurlantzick, 2003). REFERENCE Bilefsky, D. (2005). E.U. Offers New Tariff Cuts, but Internal Conflicts Remain. New York Times. Fyall, A and A Spyriadis (2003). Collaborating for growth: the international hotel industry. Journal of Hospitality and Tourism Management. Hall, J (1995). Economic growth and cultural diversity spell jobs in hospitality Black Collegian. Hellriegel, Jackson and Slocum (2005). Management. New York: Thompson. Kapstein, E (2001). The corporate ethics crusade. Foreign Affairs. Kerlin, M (1997). Peter French, corporate ethics and the Wizard of Oz. Journal of Business Ethics. Kurlantzick, J. (2003) Stay home? If the great global future of business is here, so far it's not much to look at. Entrepreneur. Lockyear, T and M Tsai (2004). Dimensions of Chinese culture values in relation to the hotel dining experience. Journal of Hospitality and Tourism Management Porter, M.E. (1980). Competitive Strategy: Techniques for Analyzing Industries and Competitors. New York: Free Press Walsh, J (2001). Business culture dictates corporate-apartment demand. Hotel Motel Management. Weaver, G (2001). Ethics programs in global business. Journal of Business Ethics. Read More