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Impact of globalization
Globalization and its impact on hotel
Impact of globalization
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1. Introduction
Globalization has incurred dramatic transformation to commerce practices around the globe. Corporations like Intel, Apple, and IBM have begun to outsource experts from different parts of the globe, reasoning variation in firm’s structures and work shifts (Bernstein, Kripalani and Engardio, 2004). Consolidation between airlines (e.g., sky alliances, on world members and star alliances) is further instances of variations caused due to this phenomenon. According to Jean de la Croix (2011), like many other industries, hospitality and tourism sector has also been affected by the globalization. Hence, this dissertation peruses the impacts of globalization on 5 star luxury hotels in Geneva city, Switzerland with a specific concern on how it impacts the hotels marketing strategy. In this etude, “globalization” reflects on the procedure of augmenting cultural and social relationship, economic, and political interdependence, market and financial accretion that are due to the advancements in transportation technologies, communication, and business liberation (Lenway and Eden, 2002)
This dissertation contains of 2 relevant etudes. The first study is designed to investigate the impacts of globalization in the marketing strategy of 5 star hotels in Geneva and the second study investigates the link between the impacts of globalization and the scale of corporate marketing and international marketing implementation of the 5 star hotels. As international business and trade expand, there is no doubt that international connections will become more and more significant for the hotel industry. According to Zhang Zhen (2005), in the late decades, many hotels have received foreign customers one day or another. Then, as the sector evolve...
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...n indicator was lately developed by collaboration between EDS Corporation and Foreign Policy Magazine (Foreign Policy, 2004).
In this dissertation, the impacts of globalization are divided into two broad groups: 1) global market threats, and 2) worldwide market opportunities.
These two important impacts are chosen in order to be perused as they are often mentioned in the past literature as one of the most certain and evident impacts of globalization (e.g., Molle & Jones, 2003; Smith & Calantone, 1999; Closs, 1992). Many believe that global market results in increases in market, business and enterprise potential and availability to the resources (Srivatava & Rukert, 1990; Smith & Calantone, 1999). However, some other like Heenan, 1989 and Jones, 2002; believe that global market results in an increase in the number and level of competition, and the degree of doubt.
My group previously visited the Sheraton Hotel for our first interview with the front desk manager and it went very well. We decided to keep with the same hotel for our next interview, but due to a last-minute cancellation from the housekeeping manager we were not able to complete the interview. Due to this situation, I will be talking about a whole different hotel - G6 Hospitality. The name G6 Hospitality refers to the hotel brands – Motel 6 and Studio 6. I chose to G6 Hospitality because it is a well-known company that I wanted to know about more in-depth. From all my research, I have gained a lot of insight on what G6 Hospitality is all about.
Osland, S.J. (2003). Broadening the Debate, the Pros and Cons of Globalization. Journal of Management inquiry, Vol. 12 no. 2, pp.137-154
Technology has created a major impact on the way in which all organizations market their products and services. With the development of the internet, companies are now able to economically market themselves on a global level. Even smaller companies that were once not able to capture international business due to the cost factor can now do just that. The Washington Plaza Hotel is no exception. The hotel industry in DC relies heavily on tourism as a major part of its client base. Many of these tourists who visit the city are of foreign nationality. It is important that the Washington Plaza Hotel targets these people when marketing the company. Not only do they target the tourist but they also target the international business travelers that come to the city on business related trips. The hotel's website, which gives detailed information about the hotel's accommodations and services, can be accessed by potential customers all over the world. In addition, the Washington Plaza Hotel has teamed up with such web-based travel services like Orbitz, Expedia, Travelocity, Etc. in order to capture more of the global market. Before the existence of the internet, the global market was not easily reachable. Technology has the greatest affect on marketing for many organizations and certainly for the Washington Plaza Hotel as well as the hospitality industry itself.
The overall aim of this paper is to evaluate ways in which changes within the global economy might impact upon marketing strategies and activities of a business organization of my choice. The company I have chosen to write about is Hutchison Whampoa Limited (HWL), which is a global conglomerate.
The Hotel industry has become very important in the past years due to immense traveling and growth of international business. Hotel industry not only plays an important role in the life of people but as well as the economy of the country. Development and advancement in the Hotel industry have rapidly been taking place and especially since the rapid change in technology, it is very important for hotels to be promptly keeping up to date. When the hotel industry is spoken of, there are many famous hotels but one hotel company that has been outstanding in growth and other aspects of business, like in Leadership, Teamwork (Employee turnover), Motivation (Customer retention and satisfaction, Goals and objectives, (changing the way hotel business has worked), and Change within the company; structurally inside and physically outside, adding elements, like entertainment, gaming, and outdoor activities, is the Hilton Hotel Company.
The overall industry saw a strong boom rate from 2010-2014. The global hotels & motels industry had total revenues of $677.1bn in 2014, representing a compound annual growth rate (CAGR) of 4.6% between 2010 and 2014. In comparison, the Asia-Pacific and US industries grew with CAGRs of 6.6% and 5% respectively, over the same period, to reach respective values of $163.7bn and $166.2bn in 2014(Global Hotels & Motels 7). The reason for this growth is due to the Asia-Pacific Region and Americas. The US alone with its world’s largest hotels/market has conquered net value growth, while China has literally doubled the revenue in the same time span. The leisure segment
4 Star Hotels - The 4 star Hotels in Delhi attract huge crowds from the nearby locations, and oftentimes the entire country. There are around thousands of hotels in urban cities, and 4 star hotels happens to be among the élite hotels.
The competitiveness of the international hospitality industry in the context of globalization is impacted by different factors. One of these factors includes the globalization drivers, which are mainly, cost, market, government, and competitive drivers. Market drivers for globalization are very much based on common customer need, and are also based on global market channels and global customers (University of Kentucky, n.d). The strength of market drivers are evaluated from a range of multi domestic sectors to the global market. For example, the market for specific foods or cuisines would likely find greater success in the local or domestic setting; however, the market for automobiles, computers, and hotels, fast food chains can be high on the global scale (University of Kentucky, n.d). Cost drivers are also drivers for globalization and include elements which relate to global-sized economies, including source efficiencies, production differences, high production development costs, as well as rapidly shifting technologies (Jager, 2009). The Science Initiative Group Institute for Advanced Study (2007) discusses that globalization is driven by cost which is largely based on the economic conditions of organizations. The persistent pressures on the “economies of scale, advances in technology, and increasing cost of product development are factors that are relevant in this grouping” (Summers, 2005, p. 284). The emergence of innovations adapted by those involved in the hospitality industry determines the costs incurred, and thereby impacts significantly on the call for globalization. In this case, advances in the manner of doing business, including internet availability and advertisements impact on trade ...
By keeping the potential for these matters to exist and the positive effects they produce in mind, an individual can be more likely to accept a global market. Additionally, one could reasonably argue that a global market has always existed and merely adapts with time. After all, Columbus set out to discover new trade roots in order to exploit a growing global market, he may have not found the fastest way to China, however, he was credited with discovering America. This fact, gives way to the idea that a global market provides much more than financial matters, in fact, the ripple effects of economic globalization build upon social endeavors just as much as they do in financial
Shangquan, Gao. “Economic Globalization: Trends, Risks, and Risk Prevention.” Development. United Nations, 2001. Web. 10 Dec. 2013. .
With the advent of the Internet, decreased shipping costs, and the removal of trade barriers, the world market has shrunk in such a way that everyone can be a player. While many businesses thrive solely on serving a small local area, a globalized company has the benefits of increased customer markets, gross production, and brand awareness. Take for example Coca-Cola; this multi-national corporation offers products in countries all over the world, operates in over 200 of those countries with the help of its franchisees, and is the most well-known beverage companies. It is interesting to note however, that as positive as globalization may seem, there are many negative ramifications and a large population of detractors to this movement. While increased product availability is good for profits, if a local market is inundated with imported products, locally grown or manufactured items may be squeezed out, to the detriment of the local economy. Although it is cost effective to have your product produced in another country with low wages, you are essentially taking away jobs from the people of your own country, negatively impacting your national economy. However, if you manufacture your products in a country with higher wages, you must increase your products’ prices which may be harmful to your profits. While maximizing your companies profits is always of great importance, it is essential that you weigh the pros and cons of globalization and its effects on not only your company, but the areas in which you wish to spread.
Globalization remains a pivotal topic in many schools of thought, and continues being a topic of controversy even in local economies today. Perhaps the reason for this is integration and competitiveness the world over. Conceivably, even more than integration, is the competitiveness of organizations, has possibly facilitating the fascination and misconception about of globalization. Nevertheless, globalization has brought about a number of effects influencing the design and geographical location of the organization. However, globalization has effectively placed the world in a bubble, or maybe one could equate the changes to being placed in an envelope.
When we are looking at globalization in tourism industry we can see that the formation of a global community has started. Nations around the world now face common problems, both economic and environmental, that they are working together to solve. More and more individuals are taking advantages of the new communication and transportation technologies to learn about and enjoy the whole planet.
Globalization’s history is extremely diversified and began during the beginning of civilization. Now we live in a world that is constantly evolving, demanding people to use resources in locations that are very difficult to obtain certain resources. This could make it completely impossible to operate in these specific parts of the world. However, globalization allows people across the world to acquire much needed resources. Globalization creates the opportunity for businesses to take advantage and exploit the ability to take part of their business to a different country. Nevertheless, globalization is part of today’s society and will be involved in virtually all situations.
Globalization is a global process that is changing the world. I would also like to discuss what are the benefits and drawbacks of globalization in the world from different perspectives.