Strategic Management Assignment: Case Analysis Of Marriott International

Question

Task:
For a Tourism and Hospitality organisation of your choice, research and analyse the existing strategy of that business.

You have recently been appointed as the CEO of your chosen organisation; apply your critical thinking skills to develop strategic recommendations for the development of the business over the next 12 months. To submit a definitive and complete Report for the organisation chosen, you will need to consider at least the following –

A brief history of the organisation and its strategic development.
The internal and external environments of the organisation.
The development of strategy at a business, functional and corporate level.
Competitive advantage and sustainability.
The impacts of mergers and acquisitions, international strategy and alliances.
Strategic implementation and the importance of leadership and entrepreneurship.
Organisational structure, controls and corporate governance.

The Report on strategic management assignment may address other relevant considerations and must include evidence of research to substantiate your conclusions and recommendations.

Answer

Executive Summary
The strategic management assignment starts with an introduction. The introduction consists the aim of the report. Following this a brief overview of Marriott International has been given which is the selected organization for the report. Then matrix organizational structure has been discussed which is preferably the current organizational structure of Marriott. The strategic goals that has been formulated by Marriott has been discussed details. Following this, PESTEL, Porter’s Five forces and SWOT has been used to create a relationship with the sustainable strategies adopted by Marriott International. Then, two strategic issues have been discussed and recommendations have been provided to reduce the discussed strategic issue. The report ends with a conclusion.

Introduction
In this current corporate environment, organizations operating in every sectors are facing tough competition. Managers often find it difficult to keep the company growing among several other competitors in the market. Developing relevant strategies can help these organizations to sustain in the market. To develop relevant strategies, strategic planning has to be done by the strategic managers. The process in which strategies are formed, evaluated and implemented in an organization is known as strategic planning. Strategic planning is considered to be communicative in nature (Spee & Jarzabkowski, 2011). There is no exception in cases of tourism or hospitality industry. A huge number of industry are operating in this sector. The main aim of this research report is to select an organization operating in the tourism or hospitality sector and to critically analyze the strategies that has been adopted by the strategic team of the organization. The organization that has been selected for the report is Marriott International.

Overview of the organization
As mentioned earlier, Marriott International has been chosen for conducting the report. Marriott International is an organization i.e. headquartered in America and is currently operating in several parts of the world. The organization is currently considered to be an integral part and leading player of the hospitality sector. The core values of the organization are to put customers or visitors first and give them utmost priority. The management team of the organization also embrace changes and focus on working with integrity (Marriott International, 2020a). The core strategies that are developed by the strategic team of Marriott International is diversity, inclusion and working with excellence. The main purpose of developing these strategies is to include people with capabilities within the organization and to avoid discrimination within the organization. Diversity and inclusion in the culture of an organization is important because it increases employee empowerment and enhances the level of satisfaction of the employees in the organization. Another major strategic decision of this organization is to care the employees working within the organization. The management team of Marriott International believes that if the organization cares its employees then the employees in return will care for the customers.

Current organizational structure
When an organization develops a system so that they can achieve the goals with utmost efficiency it is known as organizational structure. Organizational structure is also considered to be a systematic thought of the authorities of an organization (Ahmady, Mehrpour & Nikooravesh, 2016). If the organizational structure of Marriott International is analysed it can be seen that the organization is currently using a matrix structure. Since, there are several levels in the organization therefore, the organization is focusing on using the vertical level as well as the horizontal level. Marriott International focus on maintaining the global uniformity by following the core value of the organization. On the other hand, the organization also focus on following diversification of different countries in which they are operating.

Furthermore, the management team of Marriott adheres to the policies of corporate governance. The shareholders of the organization are focusing on electing the board of directors of the organization (Marriott International, 2020c). It is the responsibility of the shareholders and the Board of Directors to evaluate the strategic plans of the organization and enhance the external and internal stakeholders of the organization.

Current strategy and goals
There are several strategies that are generally adopted by the strategic managers of an organization. Currently, the global strategic team of Marriott International is focusing on adopting sustainable strategies. The strategies that help in preventing environmental degradation and create a sustainable workplace is known as sustainable strategies (Stringer, 2010). The strategic team of the organization is following the goals that have been developed by UN Sustainable development department. The leaders of Marriott believe that developing communities and supporting resiliency in the countries in which they are operating is important. The leaders have adopted transformational leadership strategy to work responsibly and in a collaborative manner so that the operational activities of Marriott will have less negative impact on the environment and reduce the risks of climate (Marriott International, 2020b). Finally, the empowerment is another important sustainable strategy that has been adopted by the organization. Unemployment among women, differently abled people and Frictional unemployment, are the major economic and global issues that the world is currently facing. Therefore, the organization is focusing on partnering with several non-profit organizations to bring a solution to this global issue and contribute to the world’s economy.

External environment and the current strategy
In the above section of the report, it is already mentioned that adopting sustainable business strategies are currently the major strategic goal of Marriott International. This section of the report on analysing the sustainable strategy of Marriott International in relation to the external environment of the organization. PESTEL tool and porter’s five forces analysis is considered for this section.

PESTEL Tool
Political factor is the first element of the PESTEL tool. It is the responsibility of an organization to follow the rules and regulations that are formulated by the government of the host country (Issa, Chang & Issa, 2010). Due to degradation in the environment, government of several developed and developing countries has made environmental rules for the organization. Therefore, sustainable strategies adopted by Marriott International to reduce negative impact and climate-change match the political aspects of the external environment.

Economic factor is the second element. The productivity of the organizations operating in a particular country, or aspects like unemployment or man-power shortage is a major part of the economic factor (Pan, Chen & Zhan, 2019). In the above section it has been discussed that the strategic team of Marriott is partnering with several voluntary organization across the world to reduce the problem of unemployment among women, differently-abled people. This is how the strategy of Marriott International has a relation with the economic aspects.

Social factor is another element of this PESTEL tool. The main aspect of the social factors is culture, values and communities (Song, Sun & Jin, 2017). The strategic team of Marriott has also focused on building backward communities and focus on children welfare. This is how the organization is focusing on creating a relationship with the social factors with its strategic decisions.

Then comes the technological factors. In the current business environment use of technology has become important. Marriott International is focusing on using technology for the purpose of innovation of products or services that can reduce the negative impact on the current environment.

Sustainable business strategy has a solid relationship with the environmental factors. The primary purpose of adopting sustainable business strategies is to reduce environmental degradation which is taking place due to the operational activities of several organizations. Finally, the legal aspects that include environmental laws have also been considered by Marriott International. The organization has focused on reducing the environmental risks by following the legal rules. Therefore, from the analysis it can be said that the current strategy has a relationship with the PESTEL tool.

Porter’s Five Forces Analysis
Michael porter has presented a framework that helps the strategic team of an organization to measure its competitive environment (Mathooko & Ogutu, 2015). This five forces focus on influencing industry.

Threats of new entrants is the first element of this analysis. There are several organizations that are starting its operation in the tourism and hospitality industry. The strategic manager of Marriott is focusing on implementing innovative and sustainable business for removing the threat. Satisfaction of external stakeholders is considerably one of the relevant strategy to gain competitive advantage and remove the threats from the existing competitors. Marriott is focusing on diversity and community development to satisfy the customers and suppliers and gain competitive advantage from the existing competitors. Thus, it can be said that Marriott chose the differential strategy in order to gain competitive advantage.

Internal environment and the current strategy
The environment which is generally influenced by the management team of an organization is known as Internal environment. The Internal environment deals with strengths, weaknesses, opportunities and threats of the organization (Kuratko, Hornsby & Covin, 2014). Currently, Marriott International is focusing on adopting strategies so that it can gain competitive advantage and increase market share in the tourism and hospitality industry. In 2019, Marriott International acquired record breaking organic rooms with the help of 815 agreements. This provides an exciting and life changing lodging opportunities for the travellers across the world. The main objective of acquiring organic rooms is to also decrease degradation of environment significantly (Hotel Business, 2020).

In 2019, the total assets of Marriott were $25.051 billion. The organization witnessed an increase of 5.72% in its assets from previous year. In September 2020, the company reported total assets of $25.680 billion (Macrotrends, 2020). Therefore, it can be said that the financial performance of Marriott International is growing over several years of operation.

SWOT Analysis
Implementation of strategy within an organization should be done after analysing the resource and capabilities of the firm. The dynamic capabilities of a firm help in analysing the performance of the firm (Lin & Wu, 2014). SWOT analysis has been taken into consideration for discussing the resources, capabilities and weaknesses of Marriott International. It currently operates in almost 127 countries. Strategic partnership and highly innovative are also one of the major strength of the organization.

Currently, Marriott is focused on family-centric businesses. With the increase in the percentage of millennials, family-centric business is considered to be a weak strategy. Along with that Marriott International is currently targeting the high income group instead of diversifying the current market. This is also considerably one of the weakness of the organization.

If Marriott focuses on the emerging economies, then it can grab relevant opportunities. The organization also has a large number of skilled employees. They are also considered to be a great opportunity for Marriott.

Currently, global pandemic is the major threat of Marriott International. Due to this pandemic, the entire tourism and hospitality industry is at standstill and this is the reason Marriott is currently losing its profit tremendously.

Aligning the sustainable strategy with the capabilities of Marriott
In the above section of the report, the strengths and weaknesses of Marriott has been discussed in detail. When an organization builds and reconfigure the internal and the external aspects of an organization it is known as the internal capabilities of a firm (Braganza, et.al, 2017). The main objective of this section is to align the strategy that has been adopted by Marriott International with the internal capabilities of the firm. From the analysis it can be said that the current sustainable strategy that has been adopted by the organization matches with the strength of the company. Since, Marriott has a global presence therefore, sustainable strategies adopted by Marriott can have positive impact on the global market. On the contrary, adopting sustainable strategies require a lot of innovative ideas and for that sufficient investment is necessary. Currently, due to the global pandemic the company is losing its profits. Therefore, the current strategy cannot be matched with the weakness or the threat that Marriot is facing.

Furthermore, the sustainable strategies that have been adopted by Marriott International can be matched with the capabilities of the firm. From the analysis it can be found that skilled and capable employees working in Marriott can help the management team with innovative ideas which can help the organization to adopt several other effective sustainable strategies which will further have a positive impact on the environment, globally.

Strategic issues of Marriott International
The issues which arises within an organization due to ineffective strategic decisions and implementation of strategy then it is known as strategic issues. The main objective of resolving strategic issues is to modifying existing strategies with thorough planning. While analysing the operations of Marriott International, it has been found that the strategic team of Marriott is focusing on niche marketing. When an organization considers a limited market for its operations it is known niche marketing (Dinis & Krakover, 2016). Marriott International focuses on customers who are of high income group. This reduces the streams from which revenue can be generated. Therefore, this can be one of the major strategic issue of the organization. Apart from this, due to this global pandemic and economic crisis, Marriott International is focusing on reducing costs by terminating employees. This is also considerably another major strategic issue of the organization. If more and more number of employees are terminated from the organization, then it can reduce the satisfaction among employees and there are high cases where customer complaints are remained unsolved which is further creating dissatisfaction among the customers. With the decrease in the satisfaction of the employees the productivity of the employees will also reduce. This will further have an impact on the financial performance and the productivity of the organization. Therefore, it is of utmost importance for the organization to leverage the internal capabilities of the organization for overcoming the strategic issues.

Recommendation
The first strategic issue that has been discussed is niche marketing by Marriott International. This is reducing the percentage of revenue within the organization. Therefore, it is recommended to the management team of Marriott to launch new products or services for a new target market. Therefore, it can be said exploration of the new customer segments is important. Diversification of product, services as well as the target market can help in increasing the percentage of revenue for the organization.

The second strategic issue is employee related issue. To reduce this issue, it is highly recommended that Marriott focus on reducing the turnover rate of employees. Employees must be satisfied within the organization. Employee rewarding program must be initiated within the organization this can reduce the turnover rate of employees. Satisfaction of employees and reducing the turnover rate of employees can be done by implementing training programs for the employees. The objective of the training program is to help the employees understand the issues that Marriott is currently facing.

Conclusion
The main aim of the report was to focus on identifying strategic issues and steps that has been undertaken by an organization operating in the hospitality sector. The organization that has been selected for the report is Marriott International. Marriott International is the United States based organization that is operating in several parts of the world. From the report it can be concluded Marriott is currently focusing on sustainable strategies to reduce the environmental degradation within the organization. The organization is focusing on empowering its employees with the help of diversity and inclusion and work with minor communities. It can also be concluded from the report that niche marketing is one of the major strategic issue that the organization is facing. To reduce this strategic issue, it is recommended to Marriott team to start exploring new markets.

References
Ahmady, G. A., Mehrpour, M., & Nikooravesh, A. (2016). Organizational structure. Procedia-Social and Behavioral Sciences, 230, 455-462. .

Braganza, A., Brooks, L., Nepelski, D., Ali, M., & Moro, R. (2017). Resource management in big data initiatives: Processes and dynamic capabilities. Journal of Business Research, 70, 328-337.

Dinis, A., & Krakover, S. (2016). Niche tourism in small peripheral towns: The case of Jewish heritage in Belmonte, Portugal. Tourism Planning & Development, 13(3), 310-332.

Issa, T., Chang, V., & Issa, T. (2010). Sustainable business strategies and PESTEL framework. GSTF International Journal on Computing, 1(1), 73-80.

Kuratko, D. F., Hornsby, J. S., & Covin, J. G. (2014). Diagnosing a firm's internal environment for corporate entrepreneurship. Business Horizons, 57(1), 37-47.

Lin, Y., & Wu, L. Y. (2014). Exploring the role of dynamic capabilities in firm performance under the resource-based view framework. Journal of business research, 67(3), 407-413.

Macrotrends, (2020). Marriott Total Assets 2006-2020 | MAR. [online]. Retrieved from https://www.macrotrends.net/stocks/charts/MAR/marriott/total-assets

Marriott International, (2020a), Core Values and Heritage. [online]. Retrieved from https://www.marriott.com/culture-and-values/core-values.mi

Marriott International, (2020b). Serve 360. [online]. Retrieved from https://serve360.marriott.com/

Marriott International, (2020c). Corporate Governance. [online]. Retrieved from https://marriott.gcs-web.com/corporate-governance

Mathooko, F. M., & Ogutu, M. (2015). Porter’s five competitive forces framework and other factors that influence the choice of response strategies adopted by public universities in Kenya. International Journal of Educational Management, 29(3), pp. 1-18.

Pan, W., Chen, L., & Zhan, W. (2019). PESTEL analysis of construction productivity enhancement strategies: A case study of three economies. Journal of Management in Engineering, 35(1), 1-40.

Song, J., Sun, Y., & Jin, L. (2017). PESTEL analysis of the development of the waste-to-energy incineration industry in China. Renewable and Sustainable Energy Reviews, 80, 276-289.

Spee, A. P., & Jarzabkowski, P. (2011). Strategic planning as communicative process. Organization studies, 32(9), 1217-1245.

Stringer, L. (2010). The green workplace: Sustainable strategies that benefit employees, the environment, and the bottom line. St. Martin's Press.

Tags: strategic management critical analysis management marriott international

NEXT SAMPLE