Introduction
Globalization, its trends as well as strategies have had pronounced impacts on the international hotel industry. Globalization plays the role incorporating all individuals and groups from different parts of the world in the world economic growth. It is a vehicle for provision of a playing ground for business enterprises that are competitive to demonstrate their esteemed ability.
This opportunity has become useful for the international hotel industry since it is possible for the key players to operate over a wide business scope. It is also possible for the individuals and business to from international partnerships that are quick in fostering economic developments, both for the involved individuals as well as the enterprises.
However, business, regardless of its scope experiences some challenges and problems. The recent decades have seen rampancy of challenges in the establishment of the international relationships, barriers that can be addressed at some level. Nevertheless, there are a number of key influences driving the global market perspective and have been adopted by many hotels. These key influences have made the international hotels integrate international partners in the implementation of new international strategies (Botherton, 2004).
The discussion in this paper brings out the understanding of the impact of globalization on the international hotel industry. An overview of what globalization and the international hotel industry are will also be established. An investigation into the key influences driving the global market perspective adopted by many hotels is also presented. It is also crucial to establish the potential barriers that are presented to organizations that operate across borders in addition to how these can be addressed.
The aspect of globalization
Globalization entails the integration of societies, cultures, as well as regional economies through a global system. The global network is the interplay of political ideologies, which include trade, communication, transport etc.
The major drivers of globalization are social, economic, political, technological, as well as cultural factors, since they are known to affect the economy in one way or another. International organizations are out to facilitate the technological advancement strategies enabling factors.
It is also important for the international society to have the advantage of investing their capital in the international scale via globalization strategies.
The most crucial globalization aspects are based on the markets that become so evident. It enhances the emergence of new production, economic, financial health policy, political as well as job markets all over the globe. There are no limitations as to which industries are to participate in the global perspective provided their operations comply with the local and host countries’ laws, thus the establishment of the international hotel industries (Lang, 2010).
The International Hotel Industry
The recent years have seen organizations go beyond their local operations into the international scope with an intention off maximizing the available opportunities. For instance, main hotels in the US and UK are known to have gone for international opportunities since the 1980’s
The hotel businesses operate internationally by partnering with other foreign hotel investments or international individuals in order to establish their bases in more than one country. International hotels have become avenues for offering excellent catering services, accommodation for tourists, international conference meetings, sports housing as well as entertainment services.
The impacts of globalization have been great in this industry since it has been possible to advance in their social, political, as well as cultural perspective. The key perspectives that drive globalization in the hotel industry have been long addressed since they are rampant, including the desire for market expansion (Fyall and Spyriadis 2003).
Key influences driving the global market perspective adopted by many hotels
Globalization has become a common phenomenon in the international scale for many hotels who have sought to adopt new international strategies. The period beginning 1980 has seen many hotels seek international operation fields in order to enhance profits maximization as well as counteract competition challenges in the highly volatile environment. The global market perspective has been driven by a variety of key factors that have helped increase the number of sectors seeking international operations (Chandra, 2004).
The search for cost-effective and efficient business operation methods has been a long-term cause for globalization in hotel industry. The valuation of group industries illustrates that it is possible to create room for maximum production at lower costs that for individual enterprises.
The maximum production ensures increased sales for profit maximization. This enables companies to operate under large economies of scale since large organizations have the opportunity to tap into wider markets of operation; reaching a large number of clients fro their services and services (Kelly, 2010).
The recent years have seen the business environment become so volatile because of rampancy in competition. This is a major factor that drives attraction of the hotel industry into the aspect of globalization. Most industries have developed outsourcing values that are meant to enhance their competitive advantage over quite a wide market.
Recent research findings have indicated hotels in Europe as having reached the level of critical mass; a level from which they no longer continue growing in the same environment, however, environmental scanning indicates that an external market would counter the condition of critical market to a better result.
This has led into the hotels seeking international avenues for business establishment. The move to expand operations in the international arena drives an organizations resource based view into a strategic move towards a positive goals attainment (Kelly, 2010).
The interest in the international market is also driven by the emergence of glamorous international brands. It is evident from research that international brands can easily be manipulated to fit within the local market according to a variety of prevailing needs that the local brands can do in the same local markets. However, with the increased rate of globalization, the international hotels have a rationale to establish their products into the global market, which become part of those rationalized to fit into the market.
Additionally, it is possible to provide their products and services into the international clients, who play the role of international agents. The international clients being ones of different cultures, the international hotels in the process gain the knowledge of each cultural requirement and work towards the achievement of international goals. It is also possible for international companies to be able to overcome barriers to trade with ease rather than when a private entity is in operation alone (Kelly, 2010).
Furthermore, technological advancements are a key factor that makes more hotels to advance their operations internationally. The invention and innovation of communication activities such as the integrated communication systems have attracted many business players into the international industry.
They have a rationale in the ability to create and enhance appropriate Customer Relationship Management strategies. Technological developments industry has played a pivotal role in creating an enabling environment for hotel businesses operations. Other factors include the desire to invest in the foreign sector for enhancement of financial security, in addition to brands and tourism promotion (Burande, 2000.
Barriers are presented to organizations that operate across borders
Operating across borders is vital in the promotion of international hotels’ services, enhancement of competitive advantage as well as market expansion rationale. However, it is not always easy for a company to operate across borders due to rampancy of barriers to operations. Barriers are evident that range from those that can easily be solved to others that are so complex and great hindrances to most of the international hotel industries (Felzenshá¹ain et al., 2002).
The structure of an organization becomes a barrier in the international scope. The application of a pyramid structure may hinder the operations of a hotel in the international scope, when the employees cannot make any decision concerning even the smallest issues. Many organizations operate under a pyramid structure that denies the middle level employees power to make any informed decisions.
These hotels do face rampant hardships since operations requiring urgent responses are not possible due to the complex communication process involved for their completeness.
Some occasions have occurred where employees fee intimidated and pressed and this leads to a high rate of labour turnover, factor that affects the overall organizational performance. The linear structure enables employees to make sound decisions and answer their clients without necessarily seeking advice, though may also be tampered with by some barriers (Yiicel et al, 2009).
Another long-term barrier to operating across boarders is how to access the worldwide capital. The international clientele fear investing in such industries as hotels due to fear of performance certainty.
The fact that the concept of hotels has not been accepted in the worldwide financial industry also hinders the foreign customers investing in the industry Investment in the hotel industry occurs via a demonstration that the hotel would perform substantially to the investors, which would take quite a long time to achieve when a company is new in the market.
This has long hindered many hotels that operate across boarders. The threefold global hotels operating in Tokyo, newborn and London have already gained competitive advantage, though it is still hard for the achieved investors to embrace the hotels. Therefore, it seems hard when hotels intend to invest in the international market (Yiicel et al, 2009).
The issue of different cultures in the international scope has really affected the operations of the hotel industry internationally. Production of products and provision of services that would fit the requirements of every culture is not always easy. Many countries have preserved cultures, for instance those who believe in the country’s quality regardless of the level.
It requires a lot of time and integration of resources in order that a hotel industry may learn to provide services that are tantamount to the cultural requirements, which may not be readily available. On the other hand, hotels may fail in the international operations when the host countries have an inadequacy of the infrastructures that would support their activities. Communication barriers have also long hindered an operation across boarders since it requires communicating with employees now and then, which proves to be hard (Yiicel et al, 2009.
How to address the potential barriers
Addressing the potential barriers to international hotel operations would be crucial to enhance the hotel operations. First, a solution to the structure of the organization operating in the international scope is urgently required in the today’s volatile business environment. Hotels operating internationally need to adopt a linear management structure that allows employees to make sound decisions regarding business operations.
This ensures speeding up of required transactions since a need by a client can be quickly addressed by the customer care representative (Dicken, 2003).
Barriers to investments would be solved by the hotels setting clear objectives regarding their operations. Legalization processes concerning the operations of the hotels need be carefully taken of in the local and host countries. Substantial business management and performance are key to organizational productivity. These factors enable the investors to develop some confidence in the hotels and invest in them (Dicken, 2003).
Solutions to the cultural problems would be solved by establishing appropriate operation’s bases in the international scope. The hotels intending to become international entities need carry out excellent market research in order scope in order to develop an understanding of the clients’ needs.
This will enable them build attractive brands that would fit the cultural needs of local and international communities. Communication barriers would be overcome by the adoption of integrated communication strategies that would enable the management communicate effectively with employees in the foreign countries. The international hotels need to select their destinations in the countries that have infrastructure that can support their desired operations (Dicken, 2003).
Conclusion
Globalization, its trends as well as strategies have had pronounced impacts on the international hotel industry. Some major factors are considered vital in driving the market perspective, which includes the desire for investing in the international market, emergence of glamorous international brands etc.
However, a number of pronounced barriers have always been a hindrance to the international operations, which include cross-cultural differences, communication, as well as lack of supportive infrastructures. However, adoption of appropriate communication strategies, substantial performance increment, as well as setting of clear objectives is ample in the enhancement of performance of the international hotels in the global perspective.
Reference List
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