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Environmental Scanning
Identifying Forces Driving Change
• Environmental scanning
• The business domain
• Setting up a structure for scanning
• Determining information needs
• Determining information mediums
• Timing information
• Identifying sources of information
• Choosing scanning activities
• Analyzing and synthesizing information
• Information sharing
• Information feedback and evaluation systems
Objectives
Please read pages 91 through 112 in the text book for further information.
Strategic Management Model
Domain Definition Long-term Objectives
Geographic Market Area Performance Measure
Segment Action Plan
Primary Competition Resources Needed
Target Market Evaluation Timetable
Responsibility
Accountability
Environmental Events Rational
Competitive Methods
Strengths and
Weakness Analysis
Remote P1 S1
Functional Analysis
Task
Financial Position
Industry P2 S2 Structural Analysis
Physical Assets Short-term Objectives
Firm Labor Force
P3 S3 Risk
Functional Competitiveness
Mission Statement
Nature of Business
Target Customer
Products/Services
Standard Desired Evaluation
Means to Accomplish Above
Scanning the Business Environment
Identifying the Forces Driving Change
Please read pages 91 through 94 in the text book for further information.
Identifying Events in the Environment
Industry Structure
Innovator/Entrepreneur
creates a new CM
Please read pages 101 through 102 in the text book for further information.
Body of Knowledge in the Hospitality
Industry
Identifying Sources of Information
Please read page 103 in the text book for further information.
Common Information Sources Available
to the Hospitality Manager
Choosing Scanning Activities
Please read pages 105 through 107 in the text book for further information.
Concept Map of Environmental Event
Please read pages 110 through 113 in the text book for further information.
Matrix Analysis
Please read pages 113 through 117 in the text book for further information.
Information-Sharing Feedback and
Evaluations Systems
Executive
Level
Functional External
Level Level
Operations
Level
Please read pages 117 through 118 in the text book for further information.
A Continuous Process of Scanning is
Necessary
• A good scanning system will never be able to
remove all the uncertainty from a decision.
Please read page 118 in the text book for further information.
Summary of the Chapter
• http://www.widenarrow.com/begrepp__bi-cykeln.ht
ml (interactive webpage)
HRIM 603
Strategic Hospitality Management
Case Study #4
Technology as a Competitive Method: The Case of
InterContinental Hotels
F.Anil Bilgihan
1) Technology, broadly, is a tool or set of tools aimed at making some aspect of life better, easier, or more efficient. Science and technology have great
potential to improve lives in all communities around the world. Technology is evolving at such a rapid pace it's hard to tell what will happen in six
months. It's hard to predict what products will make it to the market and which will take the crown and end up as everybody's favorite toy, business
companion or home entertainment device. Every technology has changed our lives, some of them in manner more aggressive than other. It’s hard to
point out to a specific technology and makes it responsible for the major changes in a life of person, because every one of us may be influenced by
other things. Businesses are using technology to gain industry advantage in many ways. “The successful companies of the next decade will be the ones
that use digital tools to reinvent the way they work. These companies will make decisions quickly, act efficiently, and directly touch their customers in
positive ways.” Bill Gates.
2) InterContinental Hotels used the technology as one of their competitive methods to gain industry advantage. For instance AT&T announced that it
has deployed an Internet Protocol Virtual Private Network (IP VPN) for InterContinental Hotels Group and its managed Candlewood Suites Hotel
portfolio, the first of its kind in the hospitality industry. The AT&T solution leverages the VPN and Multi-Protocol Label Switching (MPLS) technology to
provide a multi-faceted and highly reliable – but low cost – network. MPLS prioritizes data traffic between the hotel and the property management
application residing at AT&T’s IDC, ensuring application performance and uninterrupted communications. It is a very unique technology for hospitality
industry. Their success is behind their corporate decisions of how to invest in technology. Their company strategy was based on the leadership of its
CEO, Brian Langton, who believed in the need to integrate key marketing, reservations and operating systems into one strong technology based system
that would lead the industry as Holiday Inn had during the 1960s. He prophesied the future of technology, which was e-commerce, and integrated
necessary technologic developments to his company. The company applied the strategic plan. And with the help of that competitive method, company
gained considerable advantage over others in the industry.
Case Study Answers
Their success is behind their corporate decisions of how to invest in technology. Their company strategy
was based on the leadership of its CEO, Brian Langton, who believed in the need to integrate key
marketing, reservations and operating systems into one strong technology based system that would lead
the industry as Holiday Inn had during the 1960s. He prophesied the future of technology, which was e-
commerce, and integrated necessary technologic developments to his company. The company applied the
strategic plan. And with the help of that competitive method, company gained considerable advantage
over others in the industry.
3) Distinguishing among competitors and gaining more market share by using technology as competitive
methods have challenges. It is very important to scan the environment in this situation also. The key to
gain more market share by using technology is to have the right choice at the right time. Everyday
technology is developing so fast and these developments can be adapted to hospitality industry as well.
For example when VOIP is developed, it is very important to use this technology in your hotel first. You
need to look the environment and then adopt the technology where it fits in your industry. However,
those upgrades seem to be endless as the development of technology is not likely to stop. On the other
hand, hospitality organizations allocate a budget for technology every year. That budget is often narrow;
most of the hospitality organizations do not have enough economical power to buy all of the available
technologies. The point here is to decide which technology to integrate with, by scanning the environment
and foreseeing which technology will be demanded most by the customers. Strategic alignment is the key.
It should support the companies’ mission.
4) As we discussed in the third question, strategic alignment plays the key role. Companies should select the right technology at the right time
and this technology should be parallel to company strategy. For example, McDonalds used free Wi-Fi at their restaurants but it failed, because it
didn’t fit into company strategy which was ‘fast’. Table turnovers increased. Later they put time limit for Wi-Fi, and then it became successful.
Amount of the budget allocated to be spent in technological development is another important issue.
5) The investments that IHG has done in technology were very successful. The first reason was, they realized the need in e-commerce and
invested enough money for the upgrade. The second reason was that they realized this need at the right time and put it into process right away.
And the third reason was their understanding that the developments they have done were not a technology game but an issue of customer
service fulfillment. In 2000, selection of Web-enabled PMS was a unique strategy.
6) Although main goal of IHG was customer satisfaction, those two hotels stand as prototypes. They were used as our “experimental guestroom”
in University of Delaware to show what can be done with the latest technology. So, it can be said that there are differences between the
corporation and those two hotels. That does not mean other brands of the corporation lacks technology, but it would be useful to keep in mind
that those two hotels are not one of those Hampton Inns or Embassy Suites which are also brands of the corporation.
7) Any information related to other companies technological status would be helpful in determining the overall demand for the technology
investments IHG has made over the years. This keeps IHG in competition with other companies. Moreover, customer feedbacks and data mining
methods can be used as well.
8) Academic researches, the media (technology magazines, internet), technology conferences like HITEC, and the researches that big companies
made and, surveys can be useful in tracking developments in technology for the travel industry.
Figures for Case Study
Figure 1
Figures for Case Study
Figure 2
IT Planning Process
Figures for Case Study
Figure 3
Figures for Case Study
Figure 4
Chapter Questions
◦ the firm's ability to lead competitors in creating new products and services.
◦ the investment in strategic alliances with other firms.
◦ the degree to which the firm is dependent upon its board of directors.
◦ the manager's ability to determine the cause and effect relationships in the business
domain.
◦ the manager's ability to utilize such management tools as yield management.
Chapter Questions (cont’d)
◦ Analytical skills
◦ Marketing skills
◦ Communication skills
◦ Self-management capability
Chapter Questions (cont’d)
◦ Quantitative
◦ Qualitative
◦ Personal and personal
◦ Signals and signs
Chapter Questions (cont’d)
◦ Nutrition
◦ Sociology
◦ Safety and security
◦ Accounting
Chapter Questions (cont’d)
◦ Proactive
◦ Routine
◦ Reactive
◦ Null
Chapter Questions (cont’d)
◦ Comprehension skills
◦ Analytical skills
◦ Synthesizing skills
◦ Application skills
◦ Extrapolation skills
Chapter Questions (cont’d)
◦ annually.
◦ bi-annually.
◦ quarterly.
◦ continuously.
Chapter Questions (cont’d)