Marriott International Report

History

Marriott International was established in 1927 by Willard Marriot and his bride, Alice. The two started by putting a beer stand in Washington D.C. The beer stand could only accommodate nine people at the start of its operations. It was named “Hot Shoppe” where they prepared hot food substances like tacos, tamales and chili.

These food items were mainly served to clients during the period of winter months. In 1929, Marriott International was officially incorporated as Hot Shoppes, inc. It experienced fast growth. In 1953, the company was listed as a public company. It laid its competitive advantage in world markets on product diversification (Hoover 2002).

The company opened Twin Bridges Marriott located in Arlington, Virginia; this was the first hotel opened by the company. With its fast growing pace, Twin Bridges Marriott went international in 1966; this happened after the company took over the running of an airline catering kitchen in Venezuela.

It later changed name to Marriott Corporation in 1967. The company later engaged in series of takeovers which enabled it to grow into a billion dollar corporation. In the year 1998, Marriott International was listed in the stock market as an independent public company after which it started to focus its attention on business and leisure lodging. To ensure success in such a new venture, the company sold its superior living facilities in 2002.

Marriott International continues to diversify its operations. Nonetheless, leadership of Marriott International started with the two founders, Marriot and Alice. Today, the company’s top management entails six executives operating at senior level; it has also thirty six corporate officers (Hoover 2002).

Vision and Mission of Marriott International Company

The vision of the Marriott International Company is to be the leader in the global lodging industry; it aspires to be the world leader in providing excellent services in the hospitality industry. In order to achieve this vision, the company strives to provide the best services in the world within the hotel and lodging industry.

The mission statement of the company affirms that company’s commitment in being the best and provider of excellent lodging and food services. It achieves this by treating its workers in the best way ever so that they can offer extra-ordinary services to the company’s customers (Brotherton and Wood, 2008).

Competition

The hotel is exceedingly disjointed. The competition is mainly based on the quality of the available rooms, service provision among others. Other factors that determine competition level include the presence of global distribution system, prices charged on various products and facilities and any other innovation that may come into the industry.

It is important to note that Marriott International already operates in sixty eight nation of the world. This makes it possible for the company to offer its services to a large number of customers across the globe.

However, it must be acknowledged that the company faces stiff competition from similar companies operating in the same industry both locally and abroad. Many of the company’s competitors are already spread across eight or more countries. This means that the competitors are enjoying a wider customer base than Marriott International. The main competitors to Marriott International include:

Starwood Hotels: this group of hotels provides similar services to clients. The hotel already has 297 hotels in Europe alone. Besides, it operates in countries found in the American continent, Middle East and parts of Africa. It is therefore evident that the Starwood Hotels get more revenues than the Marriott International due to its large base of operation spread across the continent (Abrahams 2007).

Choice Hotels International: this is a group of hotels with international franchises totaling right over five thousand hotels. These franchises operate under different brands such as Comfort Inn, Sleep Inn and Cambria Suite amongst others. This company is also bigger than the Marriott International and definitely enjoys higher level of revenues than Marriott International.

Intercontinental Hotels: this is deemed the largest hotel in the world judging by the number of rooms it has. It operates in more than a hundred countries across the world. This therefore implies that it is the largest competitor to the Marriott International (Yu 1999).

Strategies used by Marriott International

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Marriott International has put in place sales structure that will ensure it remains top in the provision of hotel products in the industry. The sales initiative is customer-centered and it aims at making sales simply, effective and efficient; this also helps the company to establish its roots deeper into the untapped market segments.

The strategy enables the customers to operate at one principal contact where he or she can get all product brands. In this way, the Marriott International has managed to meet all the customer needs within a centralized point of purchase.

Beside, Marriott International relies on research to establish real customer needs. The company realized the rising level of complexity and number of channels through which customers in the industry secure rooms and accommodation or meetings; to solve these challenges, the Marriott International have come up with ways, through research, to improve the efficiency of its services to customers.

It is important to note that the company does research by involving those who are either directly or indirectly in contact with customers or clients. This includes interviewing sales leaders who have one-on-one engagement with clients, travel managers, meeting planners and sales associates. Moreover, the research is undertaken both internally and externally (Reid and Bojanic, 2009).

The Marriott International also uses the strategy of evaluating its strengths and weaknesses. This is by obtaining data from various facets of the company and doing accurate evaluation.

As a result of both internal and external research the company has established more clear roles for its employees and staff members so that customers get specific services and or assistances from specific company employees or staff members. Furthermore, Marriott International has come up with strategic idea of establishing regional sales offices to offer more effective services to its customers by organizing individual accounts.

Internal audit and external audits

Businesses are affected by both internal and external factors; the effect is either negative or positive. Internal factors are factors that a business can control while external factors are factors beyond the control of a single business.

Internal audits

To gather as much information as possible, the management undertakes the process with as many competent employees as possible. It should also analyze both published and unpublished data which will assist it in appreciating the need the prevailing conditions. The following process is followed;

• Gathering of information
• Testing data validity
• Interpolating and analyzing information gotten
• Making strategic decision based on the information gotten

The following are some of the parameters found by internal audits;

The company has a pool of experienced human resource who is employed on a track record.

It has employed a high level of technology in all its processes where it ensures that efficiency is facilitated. Corporate customers require fast and effective services since they are busy; to attain this company has embarked on an efficient technology.

Financial Ratio Analysis

Internal factor evaluation matrix

Internal factor evaluation matrix is a strategic management instrument used in auditing major strengths weaknesses of a company in major operational areas of a business entity. This instrument also provides away of linking the operations areas.

1-major weakness 2-Minor weakness 3-minor strength 4-major strength

External Audit

CPM-Competitive Matrix

Competitive Matrix for the Marriott Company is an array of major competitors of the company.

An external audit addresses five area, they are;

• Economic factors
• Social and cultural factors
• Political/governmental structures
• Technology and innovations and
• Competitive forces

The world is experiencing a rapid technological change; this is brought about by the use of computers in different sectors of a business. Marriot has benefited from the changes; for example the company has a website where a customer can log in and communicate directly to the company. These services are available for 24 hours in seven days. In line with the same, the company has embraced computerized marketing and advertisement where it sells its products all over the world through the internet. Internal processes are also facilitated…

The model of management has changed with increased enlightened people; customers are continuously demanding for better treatments form companies in the way they are served and the production processes involved. Currently social corporate responsibility management, ethical business products and customer care services have taken center stage. The company has embarked on corporate social responsibilities, it practices in environmental management exercises like tree planting, engage in clean technology among others.

In the times of global financial crisis, the government of United States is increasingly adopting laws and regulation aimed at ensuring that business are conducted effectively, standards have been reviewed and compliance with the treads is important.

External Factor Evaluation Matrix

1-poor 2-below average 3-superior 4-very superior

SWOT Analysis for Marriott International Company

Marriott International SWOT analysis (Research and Marketing n.d)

Space matrix

The space matrix is an instrument used to determine whether aggressive, defensive, competitive or conservative techniques are appropriate for the company. In this case, SPACE matrix is used to determine the appropriate strategy that the Marriott International should adopt for its growth and development. It helps the company to favorably compete with other companies within the industry.

When plotted on an X-Y axis, the statistics appears as follows:

For Marriott International, it is important that aggressive strategy be adopted. This owes to the fact that the company lags much behind its competitors. By adopting the aggressive strategy, the company will be seeking to catch up and probably outweigh its major competitors.

The strategy will be used in new acquisition of assets which are necessary for the company’s expansion to other foreign countries and other regions where it has the potential of creating more market opportunities. Furthermore, the strategy is very appropriate in terms of attracting more clients. With the large number of operators in the industry and the potential entrance of new players, aggressive strategy is most appropriate in grabbing customers and even establishing loyal clients.

Grand strategy matrix

The Internal-External (IE) Matrix

This matrix places the company into a nine cell matrix. For the company, the Internal-External Matrix looks as follows:

Quantitative Strategic Planning Matrix (QSPM) for Marriott International Company

The price of a commodity is an element of total cost plus a profit margin. When a target market has been established, there is need to determine the price affordable to the customers. A marketer should be aware of consumer’s trends and their potential. The social class that the product is targeted will influence the price of the products.

Recommendations to Marriot International Company

A customer is the backbone of a company; the main decision that a marketing manager should make determining his company’s market segment. One of the ways to enter in the target market is marketing mix. The 4Ps represent Price, product/service, promotion, and place. An effective marketing ensures that goods are available to the target customer, when they need them at and they are affordable.

Since the Marriott International Company is fast growing, and with the current challenges it faces, it is important that certain recommendations be proposed. The recommendations should be adopted with the sole reason of advancing the company’s global operations. To achieve this, the following recommendations are important:

1. Performance evaluation: the Board of Directors is the top organ of the company. It is therefore crucial that the performance of the board be evaluated with respect to the company’s goals and objectives. Besides, it will also be important to come up with appropriate instruments to be used in evaluating the performance employees and other junior staff members. This can be done through performance management;
2. Restructure marketing techniques: the company is facing stiff international competition and is likely to lose out in case it remains with the same old marketing strategies; the company should consider drawing new market communication strategies that will reposition its products in the market. In addition, the company should re-brand its products through careful and skillful innovation in order to attract new customers.
3. To ensure that the operations of the company are successful, it is important that the company defines its operation principles of internal control. Moreover, the company should also establish ways of monitoring and evaluating the internal controls.
4. The company should establish proper criteria according to which the process of risk management will be taking place. the criteria should be in such a way that potential risks are identified as early as the initial warning signs can be spotted and appropriate actions be taken promptly.
5. Financial strength is one of the most important core businesses of the company. To ensure that the company’s financial resource are well managed and utilize, it is recommended that the company gives a clear description on how the internal audit should function to avoid any form of Fraud or misappropriation of financial resource
6. It will also be important for the company to enhance the flow of information from the top level to bottom level. The flow of information on crucial and sensitive matters should be effective and efficient. This should utilize the most current communication technology.
7. The strengths and weaknesses of the company should be evaluated on a periodic basis in order to identify potential challenges that can affect the normal operations of the company. It is important to note that new challenges arise and can contribute to the company’s already existing weaknesses. Again, the company is likely to gain more strength areas which, if well utilized, can help enhance the competitive advantage of the company. A definite period should therefore be set to be used in monitoring and evaluating the internal weaknesses and strengths of the company.

Analyzing the strengths and weaknesses of the company is important since the company will be able to utilize the available opportunities and cope with threats brought about by the system.

Domestic market growth vs. Overseas Expansion of Marriot International

The Marriott International Company started as s mall hotel firm in the United States of America; during the following periods, it embarked on aggressive expansion within the local industry. Its growth in the domestic market earned it a lot of revenues that enabled it to start its expansion outside the home market.

It expanded its operations to several countries worldwide. The domestic market is getting saturated by new entrants into the industry; this poses threat to the company at local level. However, looking at the international market, there is still great opportunity to access new market segments. This implies that, the company stands a chance to gain more from overseas expansion than domestic market growth.

In the process of overseas expansion, the company also stands a great chance of acquiring other companies and new assets. The most probable candidates for acquisition are the Ritz-Carlton Hotel Company and Hilton Hotels.

The most important thing is that Marriott International should focus on acquiring assets of the most performing companies as this will bolster its financial performance and also increase its presence in the market. The two presented takeover candidates are well positioned to ensure the Marriott International achieves its growth objectives and both domestic and international expansion.

Reference List

Abrahams, J., 2007, 101 Mission Statements from Top Companies: Plus Guidelines for Writing Your Own Mission Statement, New York, Ten Speed Press.

Brotherton, B. and Wood, CR 2008, The SAGE Handbook of Hospitality Management, New York, SAGE Publications Ltd.

Hoover, G., 2002, Hoover’s Handbook of American Business 2003, New York, Hoover’s, Incorporated.

Reid, DR and Bojanic, CD 2009, Hospitality Marketing Management, New Jersey, John Wiley and Sons.

Research And Marketing n.d, Marriott International, Inc., Research and Markets, Ireland.

Yu, L., 1999, The international hospitality business: management and operations, New York, Routledge.