Research Articles Base: Hong Kong Hospitality Industry

Research Paper for Macro Analysis of the Hong Kong Hotel Industry

Introduction             The tourism industry has been a major source of revenue for Hong Kong. Along with the boom of tourism is the increase investment in hotel industry. Indeed, these two sectors have been indispensable that the subsequent decline in tourism following the economic crisis has impacted hotel operations significantly. The tourism and hotel industry in Hong Kong has been suffered major decline although it has manifested recovery during the previous years.             The factors contributing to the decline include high rates due to the high cost of living, the outbreak of SARS, deteriorating image of Hong Kong as shopper’s paradise and the development of tourist attractions in other countries in the region. The following section will review the development of the tourism industry from its subsequent decline and its way to recovery. Part A Macro Analysis The business environment is generally successful and attractive. The gross domestic product has grown consistently and became the envy of developed and developing systems. The unemployment rate has always been in a low rate while the demand for the employment remains to be buoyant. With this, there appeared to be an increase in the standard of living explaining the social stability in the country (Ash et al, 2002, p. 14). The government policy on the other hand has adopted a policy of positive non interventionism. In general, the business environment of the country is favorable for investors. Hotel Industry Hong Kong’s hotel industry is a popular channel of investment along with the booming of the tourism industry. Tourism is a major revenue earner in Hong Kong. It has become the second largest source of foreign exchange. Hong Kong serves as the travel gateway for the vast majority of business and recreational travels to China and as the primary travel hub for South East Asia. The hotel industry was geared to the tourist trade especially at the upper end (Gerzenberg, 1994). In the years prior to the hand back to China, hotel room rates rose to high levels. Room rates may have been slashed and two for one flight promotions run but the image of Hong Kong as expensive destination has been fixed in the minds of potential tourist travelers. Tourism and hotel industry has slumped badly during the Asian financial crisis. Despite the major rebound in the number of tourists coming during 1999-2000, the actual revenue received has declined. Explanations for the decline in revenue from tourists differed but include the high costs of living compare to other locations in the region. In addition to this, HK is no longer seen as a shopper’s paradise. It has been characterized by the lack of initiatives to provide tourist attractions and above all the high level of pollution affects the territory (Ash, p.19).             In 1999, hotel prices in Asia rose again as the region recovered from the economic crisis of 1997-1998. Room rates in South Korea, Japan and Taiwan rose by 32%, 38% and 30% in euros. However, China and Hong Kong experienced continued fall in room rates by 31.5% though it stabilized slightly in 1999 and towards the end of that year.  Yet the reality remains that hotels are property and properties are major investments and assets in Hong Kong. By 2000, room rates and occupancy are again at high levels (Joseph, 2005).  One of the bright spot for Hong Kong hoteliers is the climbing of tourism. By the end of last year, there were about 612 hotels and tourist guest houses in Hong Kong with 52, 512 rooms. The average occupancy rates in all hotel categories were 87% for the whole of 2006. This marked a one-percentage-growth as compared to 2005 regardless of the 7.4% increase in room supplies between December 2005 and December 2006. During 2006, about 62.75 of all visitors stayed one night and longer, a trend which reflects the importance of Hong Kong as a regional transport hub (‘Tourism in Hong Kong’, 2007). Today, the Hong Kong tourism and hotel industry is gambling its future as a tourist destination for Disneyland. The industry is expecting a boost from the increased number of tourists especially those coming from mainland China. In 2003, Beijing has eased the travel rules for mainland tourist to Hong Kong which allowed people for Chinese cities to travel individually rather than in organized groups. It has also doubled the currency allowed for mainland tourists to take with them when traveling abroad. These new polices are part of the series of measures to help stimulate Hong Kong’s’ flagging tourism, lift property and share prices (Bezlova, 2004). As a result, China has become the major source of tourist arrivals in Hong Kong (See Appendix B). Competitor Analysis             The erosion of Hong Kong’s price competitiveness resulting from regional currency turmoil and depreciation has made other destinations such as Thailand, Malaysia and Singapore to become more competitive. Thus, the industry must try harder to attract the foreign market by providing competitive packages, attractive tourism products and high quality services and satisfactory experiences (Zhang, p. 84). The need for such initiatives has been illustrated by the decreasing rate of hotel occupancy despite increase of visitor arrivals (See appendix A). There are increasing worries that the current tourism boom may fade in the years to come as wealthy mainland travelers set their destinations to Paris and London. Hong Kong is also competing with the nearby Macau. For the next decade, it plans to create 60,000 new hotel rooms (Joseph, 2005). Macau is also planning to penetrate the untapped market of China by investing in the monopolized gaming industry. It is next to Hong Kong which is likely to benefit          from the ease of travel rules from China. As Chinese people enjoy more and longer holidays, the urban rich are traveling in great numbers to Macau for gaming activities. The influx of mainland Chinese has already uplifted the economic growth of Macau which is highly dependent on tourism (Bezlova, 2004). The local competition in the hotel industry is intense. The choices are vast and there are so many competitors. Few cities offer large numbers of first rate hotels and few places competes with the services that made the Hong Kong hotel industry legendary. Most of the hotels and guest houses are situated on Hong Kong Island and in Kowloon but there are also selections in the New Territories (including the outlying islands). The keen competition and the laws of supply and demand have ensured that these hotels maintain the highest standards. PESTLE Analysis This analysis audits the impact on the market of large and usually long terms factors: political, economic, social, technological, legal and environmental changes going around the industry. These factors have dramatic impact on the working dynamics of the marketplace. Political factors such as government intervention distort the marketplace. Economic factors include the cycles of growth and decline that impact business. For instance, the increase or decrease in consumer spending impact the host of businesses from consumer goods. Social factors such as the increasing number of double income families impact the standard of living which may increase the purchasing power of consumers (Cheverton, 2004, p.75).             Technological factors are changes in technology which created the need for people to upgrade their skills to remain employable and for businesses to engage in new technologies so that they are not left behind by their competitors. Legal factors involve general legislations that affect all organizations such as employment laws and other industry specific regulations. Lastly are the environmental factors such as pollution control and the spread of diseases such as SARS that has affected businesses in the Asian region (Butler, 2001, p.40). Political Factors <ul type="disc" style="MARGIN-TOP: 0in; MARGIN-BOTTOM: 0in"> <li class="MsoNormal" style="LINE-HEIGHT: 200%; TEXT-ALIGN: justify">Government Policy of non Interventionism on Businesses</li> <li class="MsoNormal" style="LINE-HEIGHT: 200%; TEXT-ALIGN: justify">Autonomy from People’s Republic of China </li> </ul> Economic Factors <ul type="disc" style="MARGIN-TOP: 0in; MARGIN-BOTTOM: 0in"> <li class="MsoNormal" style="LINE-HEIGHT: 200%; TEXT-ALIGN: justify">High Gross Domestic Product </li> <li class="MsoNormal" style="LINE-HEIGHT: 200%; TEXT-ALIGN: justify">High Purchasing Power </li> <li class="MsoNormal" style="LINE-HEIGHT: 200%; TEXT-ALIGN: justify">Low unemployment rate </li> <li class="MsoNormal" style="LINE-HEIGHT: 200%; TEXT-ALIGN: justify">High Operating Costs </li> </ul> Social Factors <ul type="disc" style="MARGIN-TOP: 0in; MARGIN-BOTTOM: 0in"> <li class="MsoNormal" style="LINE-HEIGHT: 200%; TEXT-ALIGN: justify">Social Stability </li> </ul> <ul type="disc" style="MARGIN-TOP: 0in; MARGIN-BOTTOM: 0in"> <li class="MsoNormal" style="LINE-HEIGHT: 200%; TEXT-ALIGN: justify">Increase in the Standard of Living</li> <li class="MsoNormal" style="LINE-HEIGHT: 200%; TEXT-ALIGN: justify">Lack of Skilled workers </li> </ul> Technological Factors ·        Use of Information and Communication Technology  in the Hotel industry <ul type="disc" style="MARGIN-TOP: 0in; MARGIN-BOTTOM: 0in"> <li class="MsoNormal" style="LINE-HEIGHT: 200%; TEXT-ALIGN: justify">Technology transfer arrangements with foreign investors The use of Information Technology in various aspects of the industry  </li> </ul> Legal Factors <ul type="disc" style="MARGIN-TOP: 0in; MARGIN-BOTTOM: 0in"> <li class="MsoNormal" style="LINE-HEIGHT: 200%; TEXT-ALIGN: justify">Ease of Travel Rules from Mainland China </li> <li class="MsoNormal" style="LINE-HEIGHT: 200%; TEXT-ALIGN: justify">Accommodations are subject for 3 percent government tax </li> </ul> Environmental Factors <ul type="disc" style="MARGIN-TOP: 0in; MARGIN-BOTTOM: 0in"> <li class="MsoNormal" style="LINE-HEIGHT: 200%; TEXT-ALIGN: justify">High Levels of Pollution</li> <li class="MsoNormal" style="LINE-HEIGHT: 200%; TEXT-ALIGN: justify">Fear of SARS outbreak </li> </ul> Five Forces Analysis             This analysis discusses five competitive forces governing the tourism and hotel industry. Potential Entrants             Developers are seeing new hotel prospects at the South side of Hong Kong. This would mean new entrants in the industry. Also, 37 percent increase in hotel development is expected until 2008. Competitive Rivalry             The competition for tourist with neighboring countries is likely to increase. The development of tourist attractions such as casinos in Macau is likely to affect arrivals in Hong Kong. Also, the competitiveness of Thailand, Malaysia and Singapore in terms quality and price competitiveness is likely to impact the industry Substitutes             Hotels are not the only means for lodging. Hotels may also compete with lodging services such as tourists’ guest houses and resorts.  Bargaining power of Buyers The high purchasing power and increase in disposable income would mean that tourists are likely to spend more in exchange for satisfaction and best experience. This would require the hotels to improve their service standards if they are to remain competitive. Conversely, this may cause tourist to go other destinations such as Paris and London. Bargaining power of Suppliers             Hong Kong industries in general are suffering form the shortage of skilled workers. In the hospitality industry such as the hotel industry, customer service and satisfaction is paramount and this requires the best employees. Thus, the hotels must acquire the most skilled workers through competitive offers. Part B Future Scenarios for the Industry             Hotels in Hong Kong can be described as being capable of providing high levels of services and facilities. More than 20 million tourists are expected to visit the city every year mainly from mainland China. Developers are building up to nine new hotels in the remote industrial sectors on the south side of Hong Kong. Overall, the numbers of hotel rooms are expected to increase by 37 percent by mid 2008 to 56,816 rooms. Occupancy rates among the highest worldwide has already declined to 86 percent in 2005 from 88 percent in the previous year (Joseph, 2005). (See Appendix B).             The introduction of the seven day free visa in 1993 and the five day work week in China had positive impacts in its outbound travel to Hong Kong. This implied that positive policies such as simplified visa application and extended visa-free status play an important role in attracting international tourists to Hong Kong. HK tourism authorities emphasized the importance of positive policies for the China outbound travel market and the top agenda is to make visas easier for Chinese tour groups. Further, the relaxation on the issue of travel document formalities boosts travel numbers.             The tourism industry of Hong Kong has lobbied the Chinese government to increase daily quotas and this allowed additional 358 tourists into Hong Kong each day. With the increasing standard of living and further relaxation of the outbound travel, mainland Chinese travelers will continue to be the most important tourist market for Hong Kong in the future (Zhang, p.83). Tourism related industry such as Hotels must strive to ensure that they provide the best experience and satisfaction possible. With the political and economic condition in China, outbound vacation travel will continue to expand and Hong Kong will be the first to benefit from this growing trend. In order to maximize and get fast return, Hong Kong must shift its emphasis to the China Market and design appropriate marketing strategies (Zhang, p.84) Conclusion             The tourism and hotel industry has been characterized by significant development, subsequent decline and recovery. This industry has been considered to be one of the major sources of revenues for the country. However, it has declined greatly following the economic crisis and the outbreak of epidemic in the country. This can also be attributed to the high cost of living and the lack of tourist attractions that will entice tourist to visit the country. The condition was even worsen by the intense competition with other international destinations such as Malaysia, Thailand and Singapore. All of which are offering relatively low prices with the quality services.             To date, the industry is recovering by developing attractions such as the Disneyland. While this will boost the industry, competition will also strengthen as other countries are developing their tourist attractions such as casinos in Macau. Indeed, the hotel industry must improve its competitive position by enhancing the experience of guests through quality services, innovation and affordable prices. Recommendations <ul type="disc" style="MARGIN-TOP: 0in; MARGIN-BOTTOM: 0in"> <li class="MsoNormal" style="LINE-HEIGHT: 200%; TEXT-ALIGN: justify">Enhance Hong Kong’s image as Asia’s world city by leveraging endorsements in a wide audience reach. This would entail making use of traditional channels to communicate the essence of unique Hong Kong experiences to the targeted market segments. </li> <li class="MsoNormal" style="LINE-HEIGHT: 200%; TEXT-ALIGN: justify">Introduce and develop major tourism attractions that will boost tourist’s stay in Hong Kong.  The construction of Disneyland has helped in promoting the country as a tourist destination. Also, Macau’s concept of casino and gaming activities is a good example of tourist attraction. </li> </ul> ·        The importance of offering high quality experiences meaningful to the hotel guests is unquestionable. They should maximize the arrivals of visitors, length of stay, repeat visits and satisfaction through initiatives that will enhance visitor’s experiences. Chinese mainland tourists are expected to be the most important market of the industry and hotels must ensure that they offer the best experience through quality service and modern facilities. <ul type="disc" style="MARGIN-TOP: 0in; MARGIN-BOTTOM: 0in"> <li class="MsoNormal" style="LINE-HEIGHT: 200%; TEXT-ALIGN: justify">Hoteliers must find a way of offering competitive prices that will suit the budget of travelers. The high costs of living has always been the problem of Hong Kong and this has led to the lost of potential tourist to other competitive locations in Asia.</li> <li class="MsoNormal" style="LINE-HEIGHT: 200%; TEXT-ALIGN: justify">Offer promotional packages.  A great example of this was the cooperation of HKTB and 53 Hong Kong Hotels in 2004 to offer discounted room rates to bona fide employees of airlines, tour operators, travel agents and tourist offices outside Hong Kong. The promotion showed the range of experiences Hong Kong offers so that these key influencers could in turn motivate and inform their customers about the city. </li> <li class="MsoNormal" style="LINE-HEIGHT: 200%; TEXT-ALIGN: justify">Develop e-business. This will help hoteliers to better serve e-consumers by improving the quality of their online offers, expanding the quality of services and developing more competitive e-distribution channels. </li> </ul> Credit:ivythesis.typepad.com

Research Paper for Macro Analysis of the Hong Kong Hotel Industry

Introduction The tourism industry has been a major source of revenue for Hong Kong. Along with the boom of tourism is the incre...

The hotel industry comprises one of Hong Kong’s economic pillar

References and further reading may be available for this article. To view references and further reading you must purchase this article. 3. Methodology             The goal of the study is to explore the acquisition and utilisation of competitive intelligence in the three largest multinational hotels in Hong Kong. The research onion model ( & 2003), as shown in the Appendix, comprises the methodological framework of the research. The research onion provides the various considerations in the development of the research methodology from general to the specific considerations. 3.1 Research Philosophy The study utilised the objective approach, which posits that “social entities exist in a reality external to social actions” (& 2003,). This applies to the study because the target of the research is the processes, structures and systems comprising or interacting with competitive intelligence within which personnel operates. In addition, the researcher does not belong to the business firm subject of the study, the researcher sought to derive accurate and comprehensive information on the acquisition and utilisation of competitive intelligence in the three top hotels in Hong Kong from an outside looking in perspective. The outsider status of the researcher supports the objectivity of the data collection instrument and the interpretation of data. Objectivity, as applied in the study, is the fact-based approach (& 1997) maintained by using a well-developed and valid measurement or analytical instrument for all respondents and the answers they have given. 3.2 Research Approach             The research employed the inductive approach because the research involves the collection of specific data for analysis. From the specific data, conclusions and generalisations on the acquisition and utilisation of competitive intelligence by the three top multinational hotels in Hong Kong were determined. The inductive approach applied to the study because the study collects specific data and analyses the data to come up with general statements on the implications of the data relative to the competitive context of the hotels from which primary data comes from. 3.3 Research Strategy             This study used case study method as strategy. Case study is defined by (1984) as “an empirical inquiry that investigates a contemporary phenomenon within its real-life context; when the boundaries between phenomenon and context are not clearly evidence; and in which multiple sources of evidence are used” This definition provides a number of implications. First is the application of the case study method in empirical studies such as the current study that considers the acquisition and utilisation of competitive intelligence by the three top Hotels in Hong Kong. Second is the application of the case study in situations when the distinction between phenomenon and context is not clear. In this study, previous empirical studies have looked into the various concepts encompassed by competitive intelligence. However, there are limited studies on competitive intelligence in multinational hotels requiring detailed results to support sound conclusions. Third is the use of the case study method to draw details from multiple sources of information. The study considered three cases constituting multiple sources of rich data.             The case study method applies to the current research because the objective is to come up with detailed and context-based analysis of particular situations or events. Although the case study method has been criticised for its failure to provide limited grounds for the reliability and generality of findings, this method has also contributed significant details to knowledge on particular issues. By using the case study method in data collection, the research was able to derive detailed information able to support conclusions on the acquisition and utilisation of competitive intelligence by the three top multination hotels in Hong Kong. Since data was derived from representatives of the three hotels, data may be considered as valid in expressing the empirical foundation of the conclusions and generalisations.   3.4 Research Method             There are two research approaches, qualitative and quantitative. Each coincides with a research purpose, data requirements, data collection method, and data analysis. Although there are overlaps between the two approaches, these are distinguishable for purposes of determining the appropriate research approach. Based on the distinctions, the study applied the qualitative approach.             The qualitative approach pertains to a method applicable to studies intended to come up with detailed and comprehensive accounts or descriptions of cases, relationships and situations (&  2006). This approach supports the determination of a wide range of data encompassing the immeasurable aspect of the research such as opinions or perceptions. Moreover, the qualitative approach works well in studies seeking answers to particular issues including the identification of problems and determination of the scope of issues, understanding situations, and interpretation of the meaning of a phenomenon. In addition, this approach is appropriate in studies focusing in-depth on implications and impacts by investigating the causes, reasons, and justifications for a phenomenon. ( 2002) These features of the qualitative approach support conclusions as well as generalisations on best practices or recommendations for future action.             The quantitative approach applies deduction in forming and testing concepts or theories over a particular phenomenon. This approach usually involves the identification of theories, hypotheses for testing, and statistical methods used in testing. ( &  1998) In addition, this approach also supports the collection and analysis of measurable data ( 2003). This approach works best in researchers seeking to test theories in empirical situations or derive an understanding of situations through measures or statistical results.             Based on the conceptualisation or definition of the two approaches, the appropriate method for the study is the qualitative method because the investigation seeks to derive in-depth data and explore the acquisition and utilisation of competitive intelligence in three multinational hotels in Hong Kong.             In addition, the distinction of the qualitative and quantitative approach also justifies the use of the qualitative approach.             First distinction of the qualitative and quantitative approach is the aim or purpose appropriate to the method. The purpose of the qualitative approach is to derive a comprehensive and detailed description of the phenomenon or situation subject to investigation while the purpose of the quantitative approach is to classify and measure variables as well as develop a statistical model to explain data (2003). The present study aims to come up with an in-depth exploration of the acquisition and utilisation of competitive intelligence in the three largest multinational hotels in Hong Kong. This purpose fits the qualitative approach’s thrust towards in-depth data from accounts or descriptions. The aim of the study does not involve the testing of theories or derivation of measurable data making the quantitative approach unsuitable or inappropriate for the study.             Second distinction is the extent of expectation of outcomes. In the qualitative approach, the researcher can roughly expect certain outcomes but not the entirety of outcomes while in the quantitative approach, the research knows the intended outcome and proceeds to conduct tests to determine whether the outcome is one or the other ( 2003). In the current study, the researcher has a certain degree of knowledge of competitive intelligence based on literature. However, there is still need to know how this concept operates in multinational hotels.             Third distinction is the perspective of the research in the collection of data. In qualitative approach, the perspective of the research is subjective because of the importance of individual interpretation of the phenomenon covered by the study. This is necessary to have an in-depth investigation. In quantitative approach, the perspective of the research is objective because of the aim of deriving precise measurements and analysis of theories and quantifiable data. As such, there is no need for individual accounts of the study. ( 2003) This distinction points to the appropriateness of the qualitative approach to the study on competitive intelligence because no theory testing or derivation of measurable data is involved in the research process.             Fourth distinction related to the previous one is the role of the researcher in the data collection process. In qualitative approach, the researcher himself is the instrument in the collection of data by being part of the data gathering process that could involve interaction with key respondents while in quantitative approach the researcher employs tools to derive numerical data, which means that there could be no interaction or only limited interaction with the respondents. There is a tendency for the researcher applying the qualitative approach to become immersed in the research process and contribute insights into the data collection process and analysis while in the quantitative approach, the researcher tends to become more detached from the subject of the research investigation. This implies the emergence of the issue of bias differently in the two distinct approaches requiring differentiated responses. ( 2003) Based on this distinction, the qualitative approach applied to the study because of the participation of the researcher in the data collection process necessitating interaction with the primary source of data.             Fifth distinction is the data collection instrument. In qualitative approach, the data collection process includes observation, interview, focus group, document study, and case study involving non-measurable data while in quantitative approach, the data collection methods include survey, experiment, and other methods targeting measurable data (2003). Since the study used interview as the data collection method, then the appropriate approach is qualitative research.             Sixth distinction is the form of data. As previously mentioned, the qualitative approach results to data presented in words, pictures and objects while in quantitative approach the data comes in the form of numbers and statistical results (2003). In the study, the data derived is presented in the form of words or texts and not in the form of numbers making qualitative approach the appropriate method.             Seventh distinction is the limits of the research process. Qualitative approach involves richer data, more time involved, and moderate opportunities for generalisations depending on the purpose of the study and cases involved. Quantitative approach works more efficiently in testing hypothesis but have limitations in deriving contextual detail. (2003) The data collection process of the study consumed time in completing the interview process, transcribing the results, and analysis of the answers to the questionnaire. The study also sought to arrive at generalisations for multinational hotels or even the hotel industry in general. 3.5 Time Horizon 3.6 Data Collection Strategy 3.6.1 Data Requirement 3.6.2 Data Collection 3.7 Data Analysis 3.8 Issues 4. Data Analysis (15) 5. Conclusions (8) 6. Recommendations (1) 7. Reflections (1)               Appendices Figure 1: Overview of Competitive Intelligence Process                             Figure 2: Research Onion Model             Source: ( &  2003)       </div> Credit:ivythesis.typepad.com

The hotel industry comprises one of Hong Kong’s economic pillar

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Contemporary Development in Business and Management:Hyatt Hotel in Hong Kong

Contemporary Developments in Business and Management: Hyatt Hotel in Hong Kong The Changing Competitive Environment             Competitive Environment is the part of an organization’s external environment that is consists of other firms that are trying to win the customers in the same market. It is also the segment of the industry that includes all the immediate rivals ( 2008).             In 2007, Hong Kong shows an increase in the number of their visitors. In September of the said year, there are about 2,120,835 visitors that have arrived in the said territory, showing a great increase of 15.9% year on year. Year-to-date arrivals have reached an amazing number of 20,363,764, an increase of 9.6% year on year ( 2008).             There are different factors that can affect the competitive environment of the tourism and hotel industry in Hong Kong and it can impact the different policies and activities of Hyatt Hotel in order to maintain their position in the ever changing market of Hong Kong, primarily driven by the behavior of the tourist in the said country. Development in Hotel Industry of Hong Kong             One of the most important aspect developments of hotel industry in Hong Kong is the soaring influence of China. China’s influence on both inbound and outbound tourism has grown enormously. China is not only the major source of the arrivals of tourism into the country but continues to grow at a healthy pace. Furthermore, China is also a major destination for the outbound traveler’s because of its relative ease of access as well as low-cost benefits for the Hong Kong-based travelers (2008). In 2007, there are about 11,321,149 Chinese visitors that have traveled to Hong Kong, a great increase of 10.9% year on year (2008).             It is also important to consider the retail produce portfolio stays small, which shows that the tour packages are still the backbone of the retail travel products in Hong Kong, but the product portfolio remains limited ( 2008). This is affected by the regional economic crisis that made other Asian destination cheaper ( International 2008).             It is also important to consider the impact of the Internet with the hotel industry of the country ( 2008). There is different traveling and hotel companies that are offering online services that can make the life of the travelers or tourists easier. Hotel Design, Structure and Service             The hotel industry of the country is being affected by the different aspects regarding the changing demands of the tourists regarding the structure and design of hotels. The hotel industry of the country is focusing on the four – and five – star hotels in the country (2008).             With accordance to the said change, Hyatt focuses on maintaining and updating the design and structures of their room. According to them, the changes in the new rooms goes beyond simply updating the soft furnishing but also involved the complete redesign process of the rooms in order to meet the constantly changing needs of the new millennium traveler. The company focuses in creating a room that is perfectly suited to the needs and demands of the discriminating business traveler. Application of Technology             Technology is also one of the most important aspects that can impact the behavior of the customer regarding hotels and tourism. Technology is one of the most important factors that are being considered by Hyatt in order to maintain their competitive advantage in the ever-changing hotel industry in the country. The company had been able to introduce their in-room confidential fax machine with personalized number, voicemail with two phone lines with the data port enabling simultaneous use of the telephone and lap top computer modem. In addition to that, the company also introduces their On Command Corporation or OCX’s next generation, which is the Entertainment and Technology for Hotels service. This enables them to offer effective services that focus on the dynamic, multimedia focal point of the hotel guestroom, where in guests can access the cable and satellite TV, choose the latest Hollywood movies, utilize multi-lingual electronic; in addition to that the guest can access the Internet. The said plan enables the company to become the first hotel in Asia to offer its guests the advanced On Command technology ( 1999). Increasing Demand for Cheap Package             Another important aspect that must be considered is the financial crisis that is going on in the international arena. This can affect the overall or global tourism industry, and all of the sectors that are connected with it. That is the reason why more and more hotels and shops are beginning to slash their prices. Another important aspect is that Cathay Airways pacific is offering different special fares as well as free stopover night in Hong Kong. As of now, in a nod to the common traveler, the airline’s new frequent-flyer program will include all classes of travel, instead of just first and business class as it did before (1998).             The said development or change in the tourism industry can directly impact or influence the overall performance of the hotel sector of the country; it can affect the decision-making and policy implementation of the Hyatt with accordance to their customer relationship and marketing strategy. The company is offering different packages and special offers that will let the tourists save money while enjoying the best of Hong Kong. Aside from that, the company is also offering different types of categories of packages that will help to meet the different demands of desire of their customer such as romance, relaxation, bed and breakfast and local discovery. The said decision enables the company to improve their customer relationship as well as follow the changes in the competitive environment of hotel sector and tourism industry in the country. Impact of the Internet             The Internet plays an important role in the development of all fields, industry and sector in the world. It has a vital impact on the tourism and hospitality industry, primarily in the hotel sector. In Hong Kong, the Internet is considered as the primary factor that causes the shift of the customer relationship of the different companies and organizations that are connected with the tourism industry. As of now, more and more customers or tourists are doing their transactions with their travel agency and other tourism organizations, primarily hotels, via the Internet or online manner. According to the study of the Forrester Research in 2006, the Internet has a powerful impact on the hotel distribution. 71% of all the North Americans are doing their hotel reservation and tourism activities online, the said number will increased by 81% by 2010 ( 2006).             This enables the company to implement their online booking system that will handle the requests and transactions of their customers or tourists from different parts of the globe. Furthermore, the company is also implementing and maintaining their company website in order to keep their customer updated and informed regarding the different offerings and packages of the company.              Using their website, the tourist can search for the package that will be suitable for their budget, desired time as well as the category of their hotel needs. By doing the said strategy, it helped the company to be more close to their customers or tourists, or serve as a great way of marketing. On the other hand, it gives their customers the advantage, because they no longer have to go out in order to book their hotel transactions, above all, it can also help them to save and find their desired travel package in more efficient and easy way. Effectiveness of Hyatt’s Policies and Decision-Making             As of now, Hyatt Hotel in Hong Kong is considered as one the most well-known hotels in the country because of their innovations and services. This is due to the fact that the management of the company is doing different activities regarding their policies and decision-making that is directly related to the different changes and development in the entire tourism industry and hotel sector in Hong Kong that helped them to maintain their competitive advantage.             By focusing on the growing demand for cheap hotel accommodation, the company had been able to cater to the different demands as well as capabilities of their customers or tourists that helped them to increase their customer relationship. It also enables the company to come up with the different offering and packages that will help their customers to get what they want in lower rates.             In terms of technology, the rapid growth of the travel industry has meant that the sophisticated information technologies or IT are required in order to manage the increasing volume as well as quality of tourism services and products. There are different studies that show that modern travelers are demanding ore high quality products, travel services, information and value for their money. The emergence of the new tourism services as well as products, as well as the rapid development in the tourism demand, has driven the wide-scale adaptation of IT in general, primarily the application of the Internet ( 2005). Areas for Improvement             It is important for the company to improve their relationship or connection with other players in the tourism industry, primarily the airlines. In leadership of Cathay Pacific, this is due to the fact that airline companies are considered as the primary entities in the tourism industry, and because of the Internet, they are having a direct relationship with their customers or the tourists. By doing this, the company will be able to improve their relationship with the customers or their marketing strategy. This is due to the fact that direct and good relationship with the tourists or customers is considered as the most important aspect of any business, it will be important to satisfy the customers and let them get what they pay for.             It will also be important to continue their relationship with different travel agency in order to maintain other way of communicating or connecting with the possible customers.             In terms of their application of the Internet, it will be important if they will improve their Internet service by implementing a real-time customer relationship. It will be important to have a special service where in their customer can talk to the customer service representative of the company in real-time manner.                                               Credit:ivythesis.typepad.com

Contemporary Development in Business and Management:Hyatt Hotel in Hong Kong

Contemporary Developments in Business and Management: Hyatt Hotel in Hong Kong The Changing Competitive Environment Competi...

Contemporary Developments in Business Management: Hotel Industry in Hong Kong

Contemporary Developments in Business Management: Hotel Industry in Hong Kong   The Changing Competitive Environment             Competitive Environment is the part of an organization’s external environment that is consists of other firms that are trying to win the customers in the same market. It is also the segment of the industry that includes all the immediate rivals ( 2008).             In 2007, Hong Kong shows an increase in the number of their visitors. In September of the said year, there are about 2,120,835 visitors that have arrived in the said territory, showing a great increase of 15.9% year on year. Year-to-date arrivals have reached an amazing number of 20,363,764, an increase of 9.6% year on year (2008).             There are different factors that can affect the competitive environment of the tourism and hotel industry in Hong Kong and it can impact the different policies and activities of Hyatt Hotel in order to maintain their position in the ever changing market of Hong Kong, primarily driven by the behavior of the tourist in the said country. Hotel Industry of Hong Kong             One of the most important aspect developments of hotel industry in Hong Kong is the soaring influence of China. China’s influence on both inbound and outbound tourism has grown enormously. China is not only the major source of the arrivals of tourism into the country but continues to grow at a healthy pace. Furthermore, China is also a major destination for the outbound traveler’s because of its relative ease of access as well as low-cost benefits for the Hong Kong-based travelers (2008). In 2007, there are about 11,321,149 Chinese visitors that have traveled to Hong Kong, a great increase of 10.9% year on year ( 2008).             It is also important to consider the retail produce portfolio stays small, which shows that the tour packages are still the backbone of the retail travel products in Hong Kong, but the product portfolio remains limited ( 2008). This is affected by the regional economic crisis that made other Asian destination cheaper ( 2008).             It is also important to consider the impact of the Internet with the hotel industry of the country (  2008). There is different traveling and hotel companies that are offering online services that can make the life of the travelers or tourists easier. Competitive Environment of Hotel Industry in Hong Kong             Hong Kong’s tourism industry is facing different challenges due to the changing tourist market, global competition as well as the territory’s repatriation with China in 1997. The said factor can impact the hotel sector of the country. The result, many investors are looking forward to invest in a hotel property in the said country due to the strong growth in the tourist arrivals. Tourism is considered as one of the most important earner of the foreign currency in the country ( 1994).             A community’s growth stimulates hotel performance, while hotels contribute to the economic, social as well as cultural development of the country. It can create 37,000 jobs in the country in 1993 and generate substantial amounts of revenue for the country ( 1994).             Figure 1 shows the five forces analysis of hotel industry in the country. The porters’ model focuses on the insight that a corporate strategy must meet the different opportunities as well as threats in the external environment of the given organization or industry. It identifies five important competitive forces that helped to shape each and every industry as well as market , 2001). Figure 1 Porter’s Five Forces Analysis of Hotel Industry                                                       In terms of new entry, figure 1 show that there are different aspects that are associated with the new entry in the industry. First is that, it is expensive to enter the industry, because there is a big need for experience as well as high initial investments and fixed costs. The industry also show a perfect competition but those existing players have their cost advantage because of their experience as well as their access to the distribution channels, primarily the travel agencies and airline companies. It is also important to consider the existing player already have their close relationship with the customers or tourists. In terms of competitive rivalry, there are many players or companies of about the same size, and they have the same similar strategies, and because of that, there is not much differentiation between the players, together with their products as well as services that result to competition in terms of price.             In terms of Buyer power, because the product and service of the players in the industry are considered as important for the customers and the products and services are differentiated and cannot be replaced by substitute, it can be say that the customers have a less power over the industry. However, it is also important to consider the price-sensitivity of the customers.             The market is considered as dominated by fragmented source of supply from the different airlines as well as travel agencies that are considered as the supplier of the industry that is the reason why the supplier doesn’t have that much power to control the industry. In terms of threat of substitute, it is important to consider the brand loyalty of the customers that focuses on the different customer relationship activities and current trends that can help to improve the quality of services. Policies and Decision-Making Changing Demands of Tourists             The hotel industry of the country is being affected by the different aspects of the changing demands and desires of the tourists regarding the structure and design of hotels. The result, the said industry is focusing on the four – and five – star hotels in the country ( 2008).             The said change can affect the decision-making and policies of the industry in terms of designing their rooms as well as their overall establishments and services. It involves complete redesigning processes regarding the rooms in order to meet the constantly changing demands of the new millennium traveler. It can also affect their decision in creating a room that will be suitable for the needs and demands of the discriminating business traveler.             Technology is also one of the most important aspects that can impact the behavior of the customer regarding hotels and tourism. Technology is one of the most important factors that are being considered by different players in hotel industry of Hong Kong in order to maintain their competitive advantage. Most of the hotel companies are implementing different advanced equipment in their hotel rooms and services such as in-room confidential fax machine with personalized number, voicemail with two phone lines that is applied with the data port that enables simultaneous use of the telephone and laptop computer ( 1999).             Aside from that, technology is also being applied with the changing demands of the customers regarding entertainment. There are different hotel companies that are implementing their On Command Corporation or OCX that integrates entertainment with the technology for the hotel services. This focuses on the effective services which focus on the multimedia focal point of the hotel guestroom, where in the guest can access the cable and satellite TV, choose the latest Hollywood movies, utilize multi-lingual electronic as well as let the guest access the Internet ( 1999). Increasing Demand for Cheap Package             Another important aspect that must be considered is the financial crisis that is going on in the international arena. This can affect the overall or global tourism industry, and all of the sectors that are connected with it. That is the reason why more and more hotels and shops are beginning to slash their prices. Another important aspect is that Cathay Airways pacific is offering different special fares as well as free stopover night in Hong Kong. As of now, in a nod to the common traveler, the airline’s new frequent-flyer program will include all classes of travel, instead of just first and business class as it did before (1998).             The said development or change in the tourism industry can directly impact or influence the overall performance of the hotel sector of the country; it can affect the decision-making and policy implementation of the Hyatt with accordance to their customer relationship and marketing strategy. The company is offering different packages and special offers that will let the tourists save money while enjoying the best of Hong Kong. Aside from that, the company is also offering different types of categories of packages that will help to meet the different demands of desire of their customer such as romance, relaxation, bed and breakfast and local discovery. The said decision enables the company to improve their customer relationship as well as follow the changes in the competitive environment of hotel sector and tourism industry in the country. Application of the Internet             The Internet has a vital impact n the tourism and hospitality industry in the world as well as the hotel industry. In the country, the Internet is considered as the primary factor that causes the shift in the customer relationship activities of different companies that are connected with the said industry. As of now, more and more tourists are doing their transactions with their travel agencies and other tourism related companies via the Internet. According to the study of Forrester Research, in 2006, the Internet has a powerful impact on the hotel distribution because 71% of all the North Americans are doing their hotel reservation and tourism activities online, the said number will increase to 81% by 2010 ( 2006). The said number is important because North America is considered as one of the most important tourists sources of the country.             With the implementation and maintenance of websites, the tourists can search for the package that will be suitable for the tourist’s budget, desired date as well as category or their hotel needs. The said strategy serves as a marketing and customer relationship that enables the hotel industry to have a direct relationship and contact with the customers. Another important matter is that it enables the industry to offer low fare of budget packages to the tourists. Cheap Packages                         Another important aspect that must be considered is the financial crisis that is going on in the international arena. This can affect the overall or global tourism industry, and all of the sectors that are connected with it. That is the reason why more and more hotels and shops are beginning to slash their prices. Another important aspect is that Cathay Airways pacific is offering different special fares as well as free stopover night in Hong Kong. As of now, in a nod to the common traveler, the airline’s new frequent-flyer program will include all classes of travel, instead of just first and business class as it did before ( 1998).             The said development or change in the tourism industry can directly impact or influence the overall performance of the hotel sector of the country; it can affect the decision-making and policy implementation of the entire hotel industry in the country with accordance to their customer relationship and marketing strategy. The hotel industry is offering different packages and special offers that will let the tourists save money while enjoying the best of Hong Kong. Areas for Improvement             It is important for each and every company in the hotel industry in the country to improve their relationship or connection with other players in the tourism industry, primarily the airlines. In leadership of Cathay Pacific, this is due to the fact that airline companies are considered as the primary entities in the tourism industry, and because of the Internet, they are having a direct relationship with their customers or the tourists. This is due to the face that it can help to improve the relationship with the customers or tourists as well as the entire marketing strategy.             On the other hand, it is still important to continue the industry’s relationship with other industry such as travel agency and airline companies in order to maintain other way of communicating or connecting with the possible customers.                                                           Credit:ivythesis.typepad.com

Contemporary Developments in Business Management: Hotel Industry in Hong Kong

Contemporary Developments in Business Management: Hotel Industry in Hong Kong The Changing Competitive Environment Compe...

Strategic Management Process: Ocean Park Hong Kong

Strategic Management Process: Ocean Park Hong Kong Introduction Ocean Park is considered as a major attraction in Hong Kong, the luminous pearl of the Orient and known as the financial center of Southeast China. It is located on the south end of Hong Kong Island. The larger two sections are located on the headlands of Mount Nanlang, while the smaller section is located in the Huang Zhu Keng Valley lowlands. It is considered as one of the largest ocean in the world, having an area of 170 miles ( 2008). Organizations change and organizations compete for the same resource, competencies as well as customers. It is the cruel reality that must not be neglected by any management, thus the strategy as well as strategic management must not be neglected as a vital integral part of what managers do ( 2002,). This paper will focus on the strategic management process of the Ocean Park of Hong Kong towards their foreigner or tourists customers. It will first tackle the details about the Ocean Park. Second, it will analyze the external environment such as the economic and culture aspect that can affect the relationship of the organization to their possible foreign customers or tourists. Furthermore, it will focus on the internal environment of the organization such as its core competency, together with its strengths and weaknesses. Ocean Park Hong Kong             Ocean Park Hong Kong is considered as one of the most important amusement park in Hong Kong, and even in the world. It offers a gut-wrenching rides, magical animals as well as spectacular views. Ocean Park Hong Kong focuses on entertainment, education as well as thrill by offering different sections or parts of the park. For education purposes the organization is packed with creatures from the deep such as sharks, dolphins, jellyfish and a horde of other fishes. On the other hand, in order to meet the demands of the thrill seekers, the organization is offering roller coaster, Absyss etc ( 2008). The park is currently undergoing a massive expansion to be finished in 2010. However, there will no rides to be closed during the said period ( 2008).             The Ocean Park of Hong Kong is part of the growing global industry of amusement and theme park in the world, as well as part of the tourism industry. The organization is focuses in global market, and taking advantage of the improving tourism industry of the country, targeting their tourists, regardless of their age.     Credit:ivythesis.typepad.com

Strategic Management Process: Ocean Park Hong Kong

Strategic Management Process: Ocean Park Hong Kong Introduction Ocean Park is considered as a major attraction in Hong Kong, the luminou...

The Luxe Manor Hotel in Hong Kong

Strategic Management for Tourism and Hospitality Business: The Luxe Manor Hotel in Hong Kong Background of the Company             The Luxe Manor was established in 2006 that shows the eclectic mix of the Oriental, Post-modern and European décor that help to create and provide weary travelers with the refreshingly out of ordinary experience. The hotel is the intriguing celebration of the abstract and unreal that had been designed by  (The Luxe Manor, 2008). It is located at 39 Kimberley Road, Tsim Sha Tsui Kowloon, Hong Kong.             The Luxe Manor Hotel in Hong Kong is considered as one of the primary players of the hotel industry in the country, primarily in the sector of 5-star hotels. Analysis of Internal Environment of The Luxe Manor Hotel Strengths             One of the most important strengths of the hotel is their ability to know the demands, needs and desires of their customers, particularly the foreign tourists. This is important because the behavior of the consumer is important in different process of decision-making inside and out the company because it set as a basis for the different strategies that must be done and implement in order for a given company or organization to maintain its competitive advantage and position in the industry.             The hotel had been able to cater to the needs and demands of the Chinese tourists and the business travelers, two of the most important group of tourists in the country.             Primarily, the growing number of Chinese visitors to the country had affected the competition in the Hong Kong hotel industry. Competition is considered as a vital aspect of factors that influence the decision-making as well as the different policies and strategies, not only of the Luxe Manor Hotel but the entire hotel industry of the country. Due to the said growing competition, the hotel uses their state-of-the-art facilities and other technologies in order to offer their customers, primarily those business travelers the comfort that they are asking for, like different Internet services as well as Wi-Fi, that enables the visitors, mostly those that are using mobile devices to use the Internet anywhere inside the vicinity of the hotel. The hotel is also one of the leaders in terms of applying Internet technology in order to improve the facilities, particularly for those business travelers. This can be seen in the application of different updated technologies such as VoIP telephony, WiFi, business centre, Broadband Internet Access, AV Facilities and security key card systems (2008).             On the other hand, the hotel is also offering the other more important visitors, which are the growing number of Chinese tourists from mainland China that can be considered as price sensitive and they are spending less for hotel accommodation. The hotel is offering different packages that would cater to the limited budgets of possible visitors in the country.             On the other hand, the Internet created a great mean of marketing and customer relationship for the company. Furthermore, it had also helped the company to offer cheaper packages for the price sensitive customers or visitors.             Another important strength of the hotel is their ability to innovate and offer something new to their visitors. The said activity is important because the taste and preference of the tourists changes all the time. The hotel offers different themed suites that will complement to the characters of their visitors. This is due to the fact that the hotel is considered as a trend leader of the designer’s hotel in the country because of its artistic presentation that is blend with modern technologies. Weaknesses             On the other hand, there are different reactions and comments in the Internet that focuses on the services, advertisements as well as facilities of the hotel.             One of the most important is the system that is being used in booking or monitoring the occupancy of the rooms, whether it is available or not. This is important because overbooking is considered as a mortal sin in the hotel service. This can be solved by installing real-time system that will handle the check-in and check-out of the customers, as well as maintain the number of rooms that are available.             Another thing is the relationship of the service staff towards the customers. There are different comments that shows that the hotel service provide poor as well as unprofessional and unfriendly service. This will affect the image of the company to possible customers or visitors that are searching information about the hotel in the Internet. This can be solved by applying intensive training that is supported by different human resource policies that will focus on the staff’s service and behavior towards the customers. As we all know, the relationship between the hotel staff and the customers is the most important aspect of the hotel, after the facilities.     Opportunities             An opportunity that must be considered is the Individual Traveling scheme of China, together with the improvement of the relationship of the country to the Mainland China. The said two factors are important because it will mean more visitors or tourists in the country, and eventually more visitors in the hotel. In general, the growing and improving tourism industry will be beneficial for the demand for more hotel rooms; therefore it will mean more profits for the company.             The application of the Internet is also another important aspect; this is due to the fact that it can help the overall operation of the hotel in terms of connection and communication with their customers. The website of the hotel enables their possible customers or visitors to know more about the company, thus it serves as a marketing strategy. The Internet also enables online booking and reservation that will lessen the effort of the customers as well as the staff.             The increasing number of the business travelers, due to the fact that Hong Kong is considered as one of the most important financial centers of the world is also an opportunity for the hotel. This is due to the fact that more business travels, meetings and transactions to the country will mean more possible customers or visitors for the hotel.             Above all, the increasing popularity of the amusement park industry of the country, primarily the Ocean Park and Disneyland can also add up to the demand for room and other accommodation services in the country. Threats             Although the growing number of Chinese visitors from mainland China can be considered as an opportunity to the company, it can also be considered as one of the major threats. This is due to the fact that it can increase the overall price competition in the hotel industry of the country; therefore, in order to follow the flow and maintain the competitive advantage of the hotel, it will also lower its price in order to meet the growing demand of price-sensitive mainland Chinese. This will affect the quality of the rooms and services of the hotel due to the costs that are needed to spend in terms of renovating different rooms.             Furthermore, the poor relationship of the hotel staffs towards the customers can create negative feedback that will cause damage to the reputation and image of the hotel. Image is considered as one of the most important aspects in terms of marketing and customer relationship. Hong Kong is considered as one of the most important tourists destination of the world, as well as the most important global aviation hug, that is the reason why there are different companies and businesses that are taking advantage of the growing demand of the hotel industry in the market, if the Luxe Manor hotel in Hong Kong will continue their poor service and poor staffs’ connection to the customers, there is a big chance that their loyal customers will go for another service and accommodation of another hotel in the country. Conclusion             The internal analysis shows that the main important aspects that must be considered by the management of the Luxe Manor hotel focuses on the customer relationship, services, human resource management as well as marketing. The hotel shows a great advantage in terms of the marketing and relationship to the possible customers or visitors by application of the Internet. Furthermore, in terms of service, the hotel also offers innovative services and products that will help to capture the attention of the visitors. This will serve as a great competitive advantage that will enable the hotel to stay to and maintain its position in the local and global market and industry.             On the other hand, there are also different factors that must be considered for improvement. Primarily is the human resource management of the hotel. The relationship of the hotel staffs and the visitors is important, that is why it will be applicable to plan and implement more training and meeting that will enable the staffs to understand their important role in positioning the hotel in the entire hotel industry.             Furthermore, the internal system must be decentralized in order to make sure that all of the data and information that are connected in the process of monitoring the real-time availability of rooms.     Credit:ivythesis.typepad.com

The Luxe Manor Hotel in Hong Kong

Strategic Management for Tourism and Hospitality Business: The Luxe Manor Hotel in Hong Kong Background of the Company The L...