Macro & Micro Environment of Karma Hotel-Free-Samples for Students

Question: Analyse the Macro and Micro Environment of your chosen Hotel. Answer: Introduction Karma hotel is one of the medium range hotels in Sydney and middle-class people generally love to visit there for their professionalism and their development day after day. The Karma Company has expanded their business in different places and trying to maintain their good reputation in Australia. They have earned a good amount of revenue from hotel sector. Karma has 250 air-conditioned rooms and all the rooms are filled with separate bathrooms. There is separate lobby lounge and a pub bar is also available on the rooftop so a pleasant environment is waiting for their customers (Aissa Goaied, 2016). The hotel is located at the Bondi beach in Sydney and the entire hotel is surrounded by the flower garden so it makes a world-class attraction for tourists. In this report, macro and microenvironment analysis of the hotels is presented. Dealing with that process PEST analysis, Porters Five Forces and Value Chain models would be used and these will justify the mission, objectives and strat egic approach of the company. The recommendations also develop the final approach of the analysis and provide a strategic dimension to ensure overarching. Macro and Micro Environmental Analysis PEST In case of PEST, possible Political, Economic, Social and Technological factors are the important aspects for an organization. This is the best way to analyze the environmental situation and the required possible steps in terms of setting a new strategy. Political Australia is a democratic country and they have a good base of business development. Their government is assisting enough to establish a small and medium business at level. So they give all sorts of low-interest loans, grants money and provide tax and tariff concessions (Asbfeo.gov.au, 2018). The government is also taking care of import and export facilities and employing people and deliver marketing ideas and sales innovations so that business can sustain (Galliers Leidner, 2014). The government also prevents the imposition of Royal commission in small business and that somehow helps small businesses. Economic The economic development is fast and it is also encouraging new business opportunities to develop the business at its level. Especially in case of export ventures business obligation and traditional values are important (Asbfeo.gov.au, 2018). Capital accumulation and use this capital for the development of business resources and supply chain is the most important section. Increase in working capital and small business export facilities also encourage the economic development of the country (Nieves Segarra-Ciprs, 2015). Social The place where the hotel is the situation is the best place for people. The essence of multi-culture realism and experience a high level of accommodation facility is the important factor of this social distribution. Foreign people also love that place as the location of the hotel and the comparatively low rate of hotel fare is the main competence of this hotel (Gannon, Roper Doherty, 2015). Australian people understand their capacity of expenditure and thus this kind of hotel has made an impact over them and socially acclaimed a much. Technological Technological advancement is the most important phase of the hotel. Innovation and technological development is the key factor for pulling a large number of people towards them (Turner et al., 2017). In that scenario, fast and advanced development is the key factors that considered the improvement and providing better infrastructure for the hotel to enhance their condition through innovation. Australia has invested a lot of money in research and development and for that reason, they expected some good outcome from their associates. Table 1: PEST Analysis (Source: Gupta, 2013) Porters Five Forces The next theoretical strategy is Porter's five forces and this tool is used for the external competitive situation analysis and also states the market position and the development of the company. Bargaining power of Suppliers, Bargaining power of Buyers, Threats for new entrants, Substitutes and Competitive Rivalry are the main aspect to understand the situation. Bargaining Power of Suppliers Suppliers are the concern criteria for the hotel business. Resources are essential in that scenario and most of the resources are coming from the international market. The balance situation in the domestic and international market for the sake of resources is the key factor of supplying scenario (Elbanna, 2016). Majority of the supplying products are depending on the quality, if this is not maintained in that situation then resources can be substitutable. Thus, the Low power of supplier has noticed in that scenario. Bargaining Power of Buyers Bondi beach is one of the attractions for people and they love the place for its innate beauty. So the demand curve is always high in that factor. Another fact is very important in that segment is the low-cost rooms and accommodation facility with every other amenities. A hotel must change the dimension of their people choice and understanding of living style. Quality of the hotel is good though they hotel considered as middle-class hotel and according to that price has been set. Thus, a good demand sustained in that scenario (Ivanova, Ivano Magnini, 2016). Threat of New Entrants There are low entrants available in Bondi beach. The section of beach is quite costly, so there is less chance for small and medium quality hotel to establish their business over the section. In case of a big hotel, competition is not acceptable in that situation (Abrate Viglia, 2016). Price range is altogether different from a medium hotel. At the price, Karma delivers their rooms are quite impossible for big hotels to do so, due to their status and reputation. Threat of Substitutes High chances of substitution threat are there. In most of the cases, quality and service can be replaceable (Brotherton, 2012). In that scenario, other hotels take that same resources and mould their infrastructure according to this hotel and provide a solid threat to them. This is the major uncertainty of this section. Competitive Rivalry Competition, rivalry, and domination are the most common and related part of this industry. High level of competition in terms of resources, product and quality is an issue and majority of the hotel cost at this level are similar (Chernev Blair, 2015). This is the most challenging aspect for hotel management to gain trust from customers and deliver that amount of quality assurance to them, that customer love to come back. Table 2: Porters Five Forces (Source: Dobbs, 2014) Value chain analysis The value chain analysis considers the basic competitive advantage and value of resources in which advantages can get for the organization. This is a directive way in which organizational steps and creations are evolved through the innovative business mind and provide the best business advantages for the sustainable condition (Asbfeo.gov.au, 2018). The place, price, quality, and production are important for maintaining the value chain. In case of place, Bondi beach is very attractive and it contains such good amount of natural beauty that attracts people a lot. On the other hand, Karma is not a high-class hotel in terms of hotel fare. So people have to invest less amount of money in that segment. The quality is not an issue for Karma, they deliver quality food and brought from the good resources, so according to the price range they deliver good quality food and people love to have those (Gupta, 2013). Competitive advantage is persisted in that section but the innovative way of using the resources is the main attraction for this kind of hotel. At last, in case of value gradation, production enhancement and establishment of production is the most important factor (Dobbs, 2014). There are some influencing factors and these factors are influencing business issue and scenarios that provide competitive advantages to the hotel and deliver a secure place for Karma to do their business in an ethical way. Strategic Mission, Vision, and Ethics Vision The vision of the Karma hotel is to provide better quality in terms of services so that customers get satisfied with their service and happy to get back at their hotel. On the other hand, for the first year business plan, they have stated some additional discount for selected customers and promote their business at its highest end. Bondi beach is a well-known place of Australia if beach expanded then business will extend a bit, other than this medium range business will sustain. Mission The mission of Karma is to operate specific business scopes and purposes for the development of the business. There are some alternative resources and allocate proper decision to get the mission. Making guests happy and choosing Karma for every time is the prime mission of the hotel. Management has to look about the promotional activity, so that impact over customers and guests will sustain. Business Ethics For ethical business representation, Karma has to take care of Corporate Social Responsibility. This is a good way to understand people mindset and hen showcase companys service as per the need of customers (Walker, 2012). There are some investments; some focusing factors like stakeholders, environment, community, and finance and market stability are also influence this kind of situation and that help to reach a large number of people and company develop through this process. Overarching strategies and business directions Through the mission and vision of the company all the affecting factors that include all the operational measure like stakeholders initiation, logistic, production development all this are important and relevant for getting a competitive advantage (Hilson, 2012). Karma has lack of capability in terms of the price war with competitors and they are choosing the blue ocean strategy to develop the niche market of their production. The first operation is their resources and that is the reason they have organized all the possible resource factors (Smith, Ong, 2015). Then logistics is their concern and through the emerging market and the operational strategy, CSR will also manage the customer understanding as well. Hotel benefit and use of local citizenship always fruitful for the company and that engrossed through the operation process. Recommendations The basic recommendation factor changes the possible way of business re-infrastructure that will be more presentable as per the need of sustainable business condition. The same situation happens in this scenario where the innovative assumption and technological implementation will be the key recommendations for business. Innovation like e-booking of hotel rooms, payment facilities like the introduction of wallet and sensor door locks system all these are an important recommendation for their development (Michelini Fiorentino, 2012). CSR must work on the domestic and international level and expand their business operation internally and externally so that economic factors will operate as the main agenda. Promotion is another aspect that can spread the dimension of the business at its level best and through the promotional system lots of other stakeholders, partners will come to take this business away from its territory. Conclusion Therefore, from the above findings, it can be concluded that macro and the microenvironmental process of business strategy formulation that justifies the requirement of business and provides the extended limitation of small and medium business is the key process of operation. CSR, investment, logistic, stakeholders, innovative business styles and ethical consideration of business is important in that section that suggests possible takeover scenario that considers the best results for a better business extension. References Abrate, G., Viglia, G. (2016). 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