SWOT analysis - Case Study Example

Case Study Inserts His/Her Inserts Grade Inserts 19.11 SWOT analysis The hotel has several aspects which would enhance its program through an analysis of its internal organs. The strengths of the hotel lie mainly with the size of the company. Being a member of a chain of hotels, the hotel can use this as a way of diversifying its operations. As a member of a large company, the hotel would get a competitive edge over its competitors (Gordon, 1989). Marketing the hotel can be done collectively for the company and not a single unit the concept of boutique hotel can be identified as a week point for the new group. Maintaining the hotel as it is would be a major challenge for the new group if they lack the experience needed to run such an establishment. A theme hotel requires specialized knowledge of the various operations involved. There are numerous opportunities in existence for the hotel and the new owners. New trends in the hospitality industry are emerging. While these are becoming popular the old ones do not get obsolete. The opportunity for the hotel here is to integrate new ideas into the original one of boutique hotel. The owners of the hotel should make maximum use of these available opportunities when it starts operating to capture the market before new entrants take over. Threats to this takeover come from several places around the business. With the hotel having been previously operational, the new owners need to be aware of existing competition rivalry already in existence (Gordon, 1989). This rivalry comes from the hotels which have been competing with the Good for business within the city. The other threat comes from within the company. The brand reputation which the hotel has created over the years comes as a threat if the company decides to discontinue the concept of the hotel. This posses a great threat as all existing clients may leave if the concept of the hotel changes The Hotel performance The good hotel has faced a surmountable challenge since reopening. The performance of the hotel has been impressive compared to other industrial players. The results of the past one year show an improved level of occupancy (Drucker, 1954). Before the rebranding the hotel show seems to be lagging behind compared to its competitors. The results for the month of March in 2008 indicate that the hotel has low occupancy levels compared to the peer group. At this particular time, the growth rates of occupancy levels also indicate that the hotel is behind the industry levels. The hotel has lower average daily rates than those of the peer group. These can be attributed to the target clients whom the good hotel targets. Most of the hotel’s clients are holiday makers who are on budget holidays. As time progresses this seems to change. The results posted for the month of March 2009 indicate that the hotel has surpassed the peer group hotels. While the Good hotel achieves a positive growth rate peer group posts a negative result. These results can be attributed to the changes which were implemented in the management of the hotel. The rates of rooms are almost at par with those of peer group hotel. There has been a lot of improvement in the results when they are compared to those of the competitor group. The results of 2010 indicate slowing of growth which had been attained in the year 2009. This though was as a result of the cancellations experienced as a result of ash flows in most European countries. Most clients of the Good Hotel come from the European zone. This is what slows down the upward trend of the Good hotel. In general terms though, the hotel can be said to be at par with its competitors. The hotel has enhanced competitiveness by targeting low spending holiday makers who come in large numbers. Though the hotel has a lower daily average rate, the occupancy levels in the hotel are higher than those of the peer group. Company strategies The company has applied several strategies to enhance the good hotel brand. Branding of the hotel has been one of the numerous strategies which the company has used to enhance the good business for the hotel. This has created a unique hotel brand and made it possible to attract special kinds of clients (Porter, 2008). Through diversification the company has been able to rightly promote the Good brand as an individual unit of the company. This has differentiated the hotel from the rest of the hotels owned by the group. At the global arena, the company has been able to market the hotel through the use of social media. These have enabled the hotel to be known internationally. Word of mouth has also been spread by the clients of the hotel who come from other countries. The company has been able to use its knowledge of California to create products within the hotel which targeted at the Californian population. As a leader in the state, the company has been able to put Good brand at the same level as the corporate. These strategies have created a competitive edge for the hotel by bringing the hotel to an international level. The popularity of the hotel has been immensely enhanced making the hotel to be in a higher level than its competitors (Porter, 2008). Implementation The Good Hotel has supported the company’s strategies all along. It continues to implement and execute the strategies which the company has laid down. The hotel introduced commissioned parking rates in a bid to support the company’s strategy of branding to create a green hotel. The hotel has been awarded a LEED certificate for its efforts in the use of renewable energy sources. As a way of creating a unique brand, the hotel has used some recycled items to manufacture furniture used in the hotel. The hotel has beds made from reclaimed pine. This has been in line with the environment conservation policies which the company has laid down. The hotel has also undertaken a vigorous campaign to educate staff on the safety and green programs of the company. The hotel has sought partnership funding to help facilitate the execution of these strategies. The education of members of staff can greatly enhance that these policies are successful. Cooperation by everyone involved shall make the execution process easier and faster. The general manager has provided the right kind of leadership towards achieving the goals. She has been the one conducting the education personally while ensuring that staffs are aware of the policies. Controllable issues There are several controllable issues that need to be addressed to keep the business successful in the future. Top among those issues would be staffing. If the management want future success it is important for them to determine the members of staff they would like to have in the company (Drucker, 1954). If they aim at maintaining the same business concept the sane staff currently employed by the hotel should be maintained there. This would ensure that the concept is carried on well and at the expected levels. It would also reduce the costs involved for the management to train new members of staff. Brand reputation is the other issue which the management should address before continuing. There are clients who have been repeat guests of the hotel, compromising the brand reputation would translate into losing these clients. The brand reputation would be controlled by ensuring that the same operation procedures are maintained once the takeover is complete. The management can achieve this if the standards are kept at par with the industry level The third issue for the management to address would be hotel service standards. The standards which the boutique hotel has set are unique. They are the selling point for the hotel as they make it what it is known to be. It is therefore a matter of utmost importance to maintain the standards or if possible to raise them. If the existing clients for the hotel realize any drop in the standards they may move to seek hospitality services elsewhere. If these three issues are addresses effectively then the concept of the hotel should be expanded to cover other areas. Addressing these issues would maintain the existing clients while expanding seeks to attract new ones. Performance measurement There are would be a need to measure performance once the hotel has been taken over by new owners. Expanding the concept would be aimed at increasing the occupancy level for the hotel (Drucker, 1954). This would be easily measured by taking the statistics for the occupancy levels three months after the takeover and comparing them with those of just before the takeover. The level of satisfaction which clients shall express towards the newly adopted concepts can also be used as indicators of performance. Since the entire concept aims at improving the financial results, the financial statement would be of much help in determining the performance of the new concepts. The problems which the company shall encounter in the quest to implementing the new concept shall also help measure performance. If great difficulties are encountered, it may be an indication of failure on the part of the concept adopted. It may translate into the concept not fitting well with the target market. References Drucker, P. (1954). The Practice of Management. New York: Harper and Row. Gordon, I. (1989). Beat the Competition. How to Use Competitive Intelligence to Develop Winning Business Strategies. Oxford/UK: Basil Blackwell Publishers. Porter, M. E. (2008). The Five Competitive Forces that Shape Strategy. Harvard Business Review , 86-104. Read More