Case Study Description of Orient-Express Hotels, Portuguese Version
Used as part of the second module of a course on Managing Service Operations, which addresses the design of sustainable service models (606-031).Describes how a hotel and leisure company provides high-end service through its distinctive hotels and trains. Provides an opportunity to learn about the company's unusual quality practices and puts into doubt the unquestioned use of well-known practices, such as managing for consistency, offering incentives based on nonfinancial measures, and creating a unified message for a high-end brand. The main dilemma is whether the company should develop a loyalty program across its collection of hotels.
Swot Analysis of "Orient-Express Hotels, Portuguese Version" written by Frances X. Frei, Corey Hajim includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Hotels Unquestioned facing as an external strategic factors. Some of the topics covered in Orient-Express Hotels, Portuguese Version case study are - Strategic Management Strategies, Operations management and Technology & Operations.
Some of the macro environment factors that can be used to understand the Orient-Express Hotels, Portuguese Version casestudy better are - – customer relationship management is fast transforming because of increasing concerns over data privacy, increasing household debt because of falling income levels, challanges to central banks by blockchain based private currencies, wage bills are increasing, talent flight as more people leaving formal jobs, increasing transportation and logistics costs, technology disruption,
increasing energy prices, cloud computing is disrupting traditional business models, etc
Introduction to SWOT Analysis of Orient-Express Hotels, Portuguese Version
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Orient-Express Hotels, Portuguese Version case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Hotels Unquestioned, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Hotels Unquestioned operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of Orient-Express Hotels, Portuguese Version can be done for the following purposes –
1. Strategic planning using facts provided in Orient-Express Hotels, Portuguese Version case study
2. Improving business portfolio management of Hotels Unquestioned
3. Assessing feasibility of the new initiative in Technology & Operations field.
4. Making a Technology & Operations topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Hotels Unquestioned
Strengths Orient-Express Hotels, Portuguese Version | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Hotels Unquestioned in Orient-Express Hotels, Portuguese Version Harvard Business Review case study are -
Innovation driven organization
– Hotels Unquestioned is one of the most innovative firm in sector. Manager in Orient-Express Hotels, Portuguese Version Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Strong track record of project management
– Hotels Unquestioned is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Training and development
– Hotels Unquestioned has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Orient-Express Hotels, Portuguese Version Harvard Business Review case study by analyzing – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
High switching costs
– The high switching costs that Hotels Unquestioned has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Cross disciplinary teams
– Horizontal connected teams at the Hotels Unquestioned are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
Highly skilled collaborators
– Hotels Unquestioned has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive segment. Secondly the value chain collaborators of the firm in Orient-Express Hotels, Portuguese Version HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Learning organization
- Hotels Unquestioned is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at Hotels Unquestioned is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Orient-Express Hotels, Portuguese Version Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Operational resilience
– The operational resilience strategy in the Orient-Express Hotels, Portuguese Version Harvard Business Review case study comprises – understanding the underlying the factors in the industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
Superior customer experience
– The customer experience strategy of Hotels Unquestioned in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Sustainable margins compare to other players in Technology & Operations industry
– Orient-Express Hotels, Portuguese Version firm has clearly differentiated products in the market place. This has enabled Hotels Unquestioned to fetch slight price premium compare to the competitors in the Technology & Operations industry. The sustainable margins have also helped Hotels Unquestioned to invest into research and development (R&D) and innovation.
Effective Research and Development (R&D)
– Hotels Unquestioned has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in, as mentioned in case study Orient-Express Hotels, Portuguese Version - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Digital Transformation in Technology & Operations segment
- digital transformation varies from industry to industry. For Hotels Unquestioned digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Hotels Unquestioned has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Weaknesses Orient-Express Hotels, Portuguese Version | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Orient-Express Hotels, Portuguese Version are -
Slow decision making process
– As mentioned earlier in the report, Hotels Unquestioned has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Hotels Unquestioned even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Orient-Express Hotels, Portuguese Version, in the dynamic environment Hotels Unquestioned has struggled to respond to the nimble upstart competition. Hotels Unquestioned has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
No frontier risks strategy
– After analyzing the HBR case study Orient-Express Hotels, Portuguese Version, it seems that company is thinking about the frontier risks that can impact Technology & Operations strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
Capital Spending Reduction
– Even during the low interest decade, Hotels Unquestioned has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the industry using digital technology.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Orient-Express Hotels, Portuguese Version HBR case study still accounts for major business revenue. This dependence on star products in has resulted into insufficient focus on developing new products, even though Hotels Unquestioned has relatively successful track record of launching new products.
Increasing silos among functional specialists
– The organizational structure of Hotels Unquestioned is dominated by functional specialists. It is not different from other players in the Technology & Operations segment. Hotels Unquestioned needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Hotels Unquestioned to focus more on services rather than just following the product oriented approach.
High dependence on existing supply chain
– The disruption in the global supply chains because of the Covid-19 pandemic and blockage of the Suez Canal illustrated the fragile nature of Hotels Unquestioned supply chain. Even after few cautionary changes mentioned in the HBR case study - Orient-Express Hotels, Portuguese Version, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Hotels Unquestioned vulnerable to further global disruptions in South East Asia.
High cash cycle compare to competitors
Hotels Unquestioned has a high cash cycle compare to other players in the industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Orient-Express Hotels, Portuguese Version, it seems that the employees of Hotels Unquestioned don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
High bargaining power of channel partners
– Because of the regulatory requirements, Frances X. Frei, Corey Hajim suggests that, Hotels Unquestioned is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the industry.
Lack of clear differentiation of Hotels Unquestioned products
– To increase the profitability and margins on the products, Hotels Unquestioned needs to provide more differentiated products than what it is currently offering in the marketplace.
Opportunities Orient-Express Hotels, Portuguese Version | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study Orient-Express Hotels, Portuguese Version are -
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Hotels Unquestioned in the consumer business. Now Hotels Unquestioned can target international markets with far fewer capital restrictions requirements than the existing system.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Hotels Unquestioned to expand its talent hiring zone. According to McKinsey Global Institute, 20% of the high end workforce in fields such as finance, information technology, can continously work from remote local post Covid-19. This presents a really great opportunity for Hotels Unquestioned to hire the very best people irrespective of their geographical location.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Hotels Unquestioned can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Building a culture of innovation
– managers at Hotels Unquestioned can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Technology & Operations segment.
Loyalty marketing
– Hotels Unquestioned has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, etc.
Leveraging digital technologies
– Hotels Unquestioned can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Hotels Unquestioned can build a diversified supply chain model across various countries in - South East Asia, India, and other parts of the world. This reconfiguration of global supply chain can help, as suggested in case study, Orient-Express Hotels, Portuguese Version, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Technology & Operations industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Hotels Unquestioned can take advantage of these changes in consumer behavior to build a far more efficient business model. For example consumer regular ordering of products can reduce both last mile delivery costs and market penetration costs. Hotels Unquestioned can further use this consumer data to build better customer loyalty, provide better products and service collection, and improve the value proposition in inflationary times.
Reconfiguring business model
– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help Hotels Unquestioned to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.
Buying journey improvements
– Hotels Unquestioned can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Orient-Express Hotels, Portuguese Version suggest that firm can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Hotels Unquestioned can use these opportunities to build new business models that can help the communities that Hotels Unquestioned operates in. Secondly it can use opportunities from government spending in Technology & Operations sector.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Technology & Operations industry, but it has also influenced the consumer preferences. Hotels Unquestioned can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Using analytics as competitive advantage
– Hotels Unquestioned has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in the sector. This continuous investment in analytics has enabled, as illustrated in the Harvard case study Orient-Express Hotels, Portuguese Version - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Hotels Unquestioned to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Threats Orient-Express Hotels, Portuguese Version External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Orient-Express Hotels, Portuguese Version are -
Increasing wage structure of Hotels Unquestioned
– Post Covid-19 there is a sharp increase in the wages especially in the jobs that require interaction with people. The increasing wages can put downward pressure on the margins of Hotels Unquestioned.
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
Consumer confidence and its impact on Hotels Unquestioned demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in the industry and other sectors.
High dependence on third party suppliers
– Hotels Unquestioned high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
Easy access to finance
– Easy access to finance in Technology & Operations field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Hotels Unquestioned can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Hotels Unquestioned in the Technology & Operations sector and impact the bottomline of the organization.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Orient-Express Hotels, Portuguese Version, Hotels Unquestioned may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Technology & Operations .
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Hotels Unquestioned will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
Regulatory challenges
– Hotels Unquestioned needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Technology & Operations industry regulations.
Backlash against dominant players
– US Congress and other legislative arms of the government are getting tough on big business especially technology companies. The digital arm of Hotels Unquestioned business can come under increasing regulations regarding data privacy, data security, etc.
Capital market disruption
– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of Hotels Unquestioned.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Hotels Unquestioned with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Weighted SWOT Analysis of Orient-Express Hotels, Portuguese Version Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study Orient-Express Hotels, Portuguese Version needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of the case study Orient-Express Hotels, Portuguese Version is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of the Harvard case study Orient-Express Hotels, Portuguese Version is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of Orient-Express Hotels, Portuguese Version is to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Hotels Unquestioned needs to make to build a sustainable competitive advantage.