Five Forces Analysis Of The Gresham Hotel Dublin Tourism Essay

1883 words (8 pages) Essay

1st Jan 1970 Tourism Reference this

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The Gresham Hotel, Dublin, is a four star quality accommodation and service hotel, located on OConnell Street in the heart of city center.

At these days are employed 183 employees in the Gresham hotel Dublin, which is included all part time, casual and senior staff, all over the departments.

The Gresham Hotel Dublin is part with other 4 hotels of Gresham Group located across Europe; they are situated on the city center of Hamburg, London, Brussels, Cork and Dublin.

Type of business

The Gresham Hotel is a Public Limited Company, means that all the debs of the business are cleared by the business and money is not taken out of the owners´ personal funds. The Gresham Hotel is a separate legal entity from the owners. The company is permitted to offer shares to the public and must include the words Plc as part of company name.

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The Gresham Hotel, O’Connell Street, is a four star hotel and this kind of business is based in service. They provide a wide range of facilities where all customers are well welcome with four star services. They also organize events such as weddings, parties and type of business nature.

In each department of this organization is a Wide Span of Sontrol, the Manager/Supervisor is in charge of a large number of employees. It is also a Tall structure as the company has many levels of hierarchy.

My duties in this company has the same standard as an employee which any reporting has to be made to the manager/supervisor ,following the manager/supervisor reporting to Duty Manager and this one reporting to Human Resources and finally the Human Resources to Director.

This company is divided in many departments which are;

Toddy’s bar-food and beverage, where I am present doing my work experience, my duties is mainly customer care. This department works fourteen people which two of them are supervisor.

Writers bar-the main bar of the hotel which also serve food

Kitchen department- this department runs all department involving food.

Catering and Banqueting department- this department is responsible for all events

Accountancy department

Gallery restaurant- where at present is used for breakfast as this restaurant have been closest.

External influence on organisation

PEST

The PEST analysis is a useful tool for understanding market growth or decline, this method is used to scan for the external, macro environment, factors that influences on any company.

PEST analysis stands for;

Political factors- include government regulations

Economic factors – affect the purchasing power of potential customers and the firms cost capital

Social factors- include the demographic and cultural aspects

Technological – technology is vital for competitive advantage, and is a major driver of globalization.

On The Gresham Hotel analysis, the external factors that may affect the company are;

Political

Opening and closing times – this regulation set up the opening and closing hours in a business.

Smoking ban -it is forbidden smoking indoors by law and affects the company in certain way.

Economic

Interest rate- due the economic situation nowadays, the interest rates defines people of spending or saving money.

Unemployment levels- due the economic situation turndown, a number of customers decrease derived to increased of unemployment levels.

Sociological

Lifestyle change- nowadays the people pay more attention to product/service´s price (cheaper option), drinking at home and also they start going later and spending less time in pub.

Cultural- Drinking alcohol is an everyday part of adult life in Ireland. Nowadays customers spend less on drinks, drinking more at home.

Technological

Nowadays the technology more than ever is vital for competitive advantage.

The technology has an impact on any company, such as till…

Provide a quicker a efficient service to a customer

Some duties as stocktaking can be changed by technology, saving time and money

Technology offer to customer other facility ways such as booking a room, purchase vouchers, etc.

The labor can be switched by technology

PORTER FIVE FORCES

Five Forces Analysis assumes that there are five important forces that determine competitive power in a situation.These are:

Competitive Rivalry

Majority of competitors have the similar strategies , indicating high competitive rivalry

Differentiation between their main products/service is low, indicating high competitive rivalry.

There are no substitute products available to customers, indicating high competitive rivalry.

Many competitors have more or less the same size.

Bargaining power of suppliers

We realize, the fewer suppliers choices we have, more power they are over the company, and how easy it is to drive their prices up.

Uniqueness product-The Guinness is an example of a powerful brand; the Guinness is supplied by a unique supplier,

Some product based on food is supplied for a few choices companies where provide a unique service to a company.

Bargaining power of customers

Here we can see how easy it is customers to drive the prices down.

The customer may have bargaining power when;

When there is no substitute or a little differentiation over the product/service – food and beverage is similar to those of someone else.

switching to another product/service is not costly

Price sensitive – at this days, more than ever the customers are more sensitive to a product/service prices.

Threats of new entrants

A threat of new entrants is high if;

Low barriers to entry

economies of scale

government legislations to encourage them to enter the industry

differentiations on their product/service

capital

Threat of substitute products

The treat of substitute is high when the product/service substitutes offer benefits similar and also when it is ease at customers can switch with low or no cost.

Product/Service – when a substitute product/service falls

Cost of change – no cost/low cost of switching a product/service

Internal & External influence on organisation

SWOT

The SWOT analysis is very important tool for carrying out a good strategic planning, and it is a powerful tool of the marketing. When it is a matter of companies that compete in a same market – target, it is important that they detect the threats and opportunities in the company, by studying the external environment. It is also of fundamental importance that they evaluate the weaknesses and strengths points of the company, studying of its internal environment. During the analysis, when a strong point is realized, they must be emphasized to the utmost, and when a weak point is realized, the organization must act to control it or, at least, to minimize its effect. This technique is interesting, that means “change”, which very often contributes to the growth or not, it would be depended on the performance to correspond to the objectives of the organization.

Strength

Brand name – this brand is well know national and international

Location- located in city center

4 star hotel- this hotel provides a 4 star service and accommodation

Wide range of facilities- Writers Bar, Toddy´s Bar , fitness studio, SPA and restaurant 23

Business facilities

Complimentary WIFI access in all conference rooms,

Quadriga interactive TV systems in all rooms – provides PPV movies, internet, music.

288 tasteful bedrooms, containing everything the discerning traveller would need, including spacious work desk

Dedicated butler service for the meeting rooms

Registration Lobby

Fully air conditioned

A range of audio visual equipment for hire

Secreterial services

www.gresham-hotels.com/dublin-city-hotels/business_facilities.asp

Weaknesses

Restaurant 23 – remain closest, as the only restaurant available and considering a 4 star hotel, it creates a high impact on customers’ expectations.

High cost product/service- nowadays, customers are more sensible to product/service prices, discontentment has been expressed by customers relating to product/service price to high.

Poor employee´s motivation- employee are unhappy with the management style, consequently will have impact on their organization

Technology no updated- it causes a slower service and sometimes misunderstands between employees and customers because of it.

Lack of marketing expertise´s

Opportunities

New technology arrivals- nowadays there is a need of new technology, it means modernization to make the company more efficient.

Marketing department- would be a great opportunity for growth and profit.

Restaurant -reopen the restaurant in the hotel.

New ways of advertising and promoting (radio, TV,Internet)- would let the people know about their offers and promotions for short and long term.

Threats

New regulations/tax- there is a threat of more regulations and higher taxes.

World economy recession- would affect directly the hospitality economy and consequently the competition becomes higher between competitors.

Price wars with competitors-the hospitality´s competition is very high and price wars may become a huge threat.

Strikes- the Gresham Hotel like other companies are minimizing their spending, changing their behavior with employees, consequently would be a threat for this organization.

The Swot analysis above may help The Gresham Hotel growth by capitalizing on opportunities using their strengths and eliminating their weaknesses and threats.

CONCLUSION

This Environment Analysis was based on the Gresham Hotel, overall the company in many aspects has competitive advantage over their competitors.

At the end of environment analysis where was scanned internally and externally by Swot, Pest and Porter Five Forces analysis we can understand better the Gresham Hotel´s position facing to its competitors.

Some disadvantages such as no restaurant available, heavy environment between managements and employees are in my opinion huge weak provoking a high impact on their company.

The company has a good reputation among their customers and it has resources and vantages to face to its competitors if they capitalize on opportunities using their strength and eliminating their weaknesses and threats it would contribute for company´s growing.

RECOMMENDATIONS

I would recommend more investment on marketing resources and also in technologies, which I truly believe they are main keys for company growth.

It is essential that there is a good team spirit at work, therefore I believe that the management should reach an agreement between staff and managements interests.

The Gresham Hotel, Dublin, is a four star quality accommodation and service hotel, located on OConnell Street in the heart of city center.

At these days are employed 183 employees in the Gresham hotel Dublin, which is included all part time, casual and senior staff, all over the departments.

The Gresham Hotel Dublin is part with other 4 hotels of Gresham Group located across Europe; they are situated on the city center of Hamburg, London, Brussels, Cork and Dublin.

Type of business

The Gresham Hotel is a Public Limited Company, means that all the debs of the business are cleared by the business and money is not taken out of the owners´ personal funds. The Gresham Hotel is a separate legal entity from the owners. The company is permitted to offer shares to the public and must include the words Plc as part of company name.

The Gresham Hotel, O’Connell Street, is a four star hotel and this kind of business is based in service. They provide a wide range of facilities where all customers are well welcome with four star services. They also organize events such as weddings, parties and type of business nature.

In each department of this organization is a Wide Span of Sontrol, the Manager/Supervisor is in charge of a large number of employees. It is also a Tall structure as the company has many levels of hierarchy.

My duties in this company has the same standard as an employee which any reporting has to be made to the manager/supervisor ,following the manager/supervisor reporting to Duty Manager and this one reporting to Human Resources and finally the Human Resources to Director.

This company is divided in many departments which are;

Toddy’s bar-food and beverage, where I am present doing my work experience, my duties is mainly customer care. This department works fourteen people which two of them are supervisor.

Writers bar-the main bar of the hotel which also serve food

Kitchen department- this department runs all department involving food.

Catering and Banqueting department- this department is responsible for all events

Accountancy department

Gallery restaurant- where at present is used for breakfast as this restaurant have been closest.

External influence on organisation

PEST

The PEST analysis is a useful tool for understanding market growth or decline, this method is used to scan for the external, macro environment, factors that influences on any company.

PEST analysis stands for;

Political factors- include government regulations

Economic factors – affect the purchasing power of potential customers and the firms cost capital

Social factors- include the demographic and cultural aspects

Technological – technology is vital for competitive advantage, and is a major driver of globalization.

On The Gresham Hotel analysis, the external factors that may affect the company are;

Political

Opening and closing times – this regulation set up the opening and closing hours in a business.

Smoking ban -it is forbidden smoking indoors by law and affects the company in certain way.

Economic

Interest rate- due the economic situation nowadays, the interest rates defines people of spending or saving money.

Unemployment levels- due the economic situation turndown, a number of customers decrease derived to increased of unemployment levels.

Sociological

Lifestyle change- nowadays the people pay more attention to product/service´s price (cheaper option), drinking at home and also they start going later and spending less time in pub.

Cultural- Drinking alcohol is an everyday part of adult life in Ireland. Nowadays customers spend less on drinks, drinking more at home.

Technological

Nowadays the technology more than ever is vital for competitive advantage.

The technology has an impact on any company, such as till…

Provide a quicker a efficient service to a customer

Some duties as stocktaking can be changed by technology, saving time and money

Technology offer to customer other facility ways such as booking a room, purchase vouchers, etc.

The labor can be switched by technology

PORTER FIVE FORCES

Five Forces Analysis assumes that there are five important forces that determine competitive power in a situation.These are:

Competitive Rivalry

Majority of competitors have the similar strategies , indicating high competitive rivalry

Differentiation between their main products/service is low, indicating high competitive rivalry.

There are no substitute products available to customers, indicating high competitive rivalry.

Many competitors have more or less the same size.

Bargaining power of suppliers

We realize, the fewer suppliers choices we have, more power they are over the company, and how easy it is to drive their prices up.

Uniqueness product-The Guinness is an example of a powerful brand; the Guinness is supplied by a unique supplier,

Some product based on food is supplied for a few choices companies where provide a unique service to a company.

Bargaining power of customers

Here we can see how easy it is customers to drive the prices down.

The customer may have bargaining power when;

When there is no substitute or a little differentiation over the product/service – food and beverage is similar to those of someone else.

switching to another product/service is not costly

Price sensitive – at this days, more than ever the customers are more sensitive to a product/service prices.

Threats of new entrants

A threat of new entrants is high if;

Low barriers to entry

economies of scale

government legislations to encourage them to enter the industry

differentiations on their product/service

capital

Threat of substitute products

The treat of substitute is high when the product/service substitutes offer benefits similar and also when it is ease at customers can switch with low or no cost.

Product/Service – when a substitute product/service falls

Cost of change – no cost/low cost of switching a product/service

Internal & External influence on organisation

SWOT

The SWOT analysis is very important tool for carrying out a good strategic planning, and it is a powerful tool of the marketing. When it is a matter of companies that compete in a same market – target, it is important that they detect the threats and opportunities in the company, by studying the external environment. It is also of fundamental importance that they evaluate the weaknesses and strengths points of the company, studying of its internal environment. During the analysis, when a strong point is realized, they must be emphasized to the utmost, and when a weak point is realized, the organization must act to control it or, at least, to minimize its effect. This technique is interesting, that means “change”, which very often contributes to the growth or not, it would be depended on the performance to correspond to the objectives of the organization.

Strength

Brand name – this brand is well know national and international

Location- located in city center

4 star hotel- this hotel provides a 4 star service and accommodation

Wide range of facilities- Writers Bar, Toddy´s Bar , fitness studio, SPA and restaurant 23

Business facilities

Complimentary WIFI access in all conference rooms,

Quadriga interactive TV systems in all rooms – provides PPV movies, internet, music.

288 tasteful bedrooms, containing everything the discerning traveller would need, including spacious work desk

Dedicated butler service for the meeting rooms

Registration Lobby

Fully air conditioned

A range of audio visual equipment for hire

Secreterial services

www.gresham-hotels.com/dublin-city-hotels/business_facilities.asp

Weaknesses

Restaurant 23 – remain closest, as the only restaurant available and considering a 4 star hotel, it creates a high impact on customers’ expectations.

High cost product/service- nowadays, customers are more sensible to product/service prices, discontentment has been expressed by customers relating to product/service price to high.

Poor employee´s motivation- employee are unhappy with the management style, consequently will have impact on their organization

Technology no updated- it causes a slower service and sometimes misunderstands between employees and customers because of it.

Lack of marketing expertise´s

Opportunities

New technology arrivals- nowadays there is a need of new technology, it means modernization to make the company more efficient.

Marketing department- would be a great opportunity for growth and profit.

Restaurant -reopen the restaurant in the hotel.

New ways of advertising and promoting (radio, TV,Internet)- would let the people know about their offers and promotions for short and long term.

Threats

New regulations/tax- there is a threat of more regulations and higher taxes.

World economy recession- would affect directly the hospitality economy and consequently the competition becomes higher between competitors.

Price wars with competitors-the hospitality´s competition is very high and price wars may become a huge threat.

Strikes- the Gresham Hotel like other companies are minimizing their spending, changing their behavior with employees, consequently would be a threat for this organization.

The Swot analysis above may help The Gresham Hotel growth by capitalizing on opportunities using their strengths and eliminating their weaknesses and threats.

CONCLUSION

This Environment Analysis was based on the Gresham Hotel, overall the company in many aspects has competitive advantage over their competitors.

At the end of environment analysis where was scanned internally and externally by Swot, Pest and Porter Five Forces analysis we can understand better the Gresham Hotel´s position facing to its competitors.

Some disadvantages such as no restaurant available, heavy environment between managements and employees are in my opinion huge weak provoking a high impact on their company.

The company has a good reputation among their customers and it has resources and vantages to face to its competitors if they capitalize on opportunities using their strength and eliminating their weaknesses and threats it would contribute for company´s growing.

RECOMMENDATIONS

I would recommend more investment on marketing resources and also in technologies, which I truly believe they are main keys for company growth.

It is essential that there is a good team spirit at work, therefore I believe that the management should reach an agreement between staff and managements interests.

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