Marriott Hotels: Company Analysis

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Over the decades of its existence in the hospitality industry, Marriott Hotels has warranted the image of a luxury company with exceptional services. Although the organization has been facing challenges in responding to the competitiveness of other major companies functioning in the hospitality market, Marriott has been one of the industry leaders for decades (see Fig. 1). However, to remain competitive, the company will have to focus on building a more effective communication channel and a better framework for data security, which will imply investing in R&D extensively.

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Marriott Hotels: Share Prices
Figure 1. Marriott Hotels: Share Prices (2016-2021) (“Marriott International, Inc. (MAR),” 2021).

As the graph above shows, Marriott Hotels have managed to overcome the drastic effects of the pandemics and the economic crisis that ensued, swiping every industry and curbing the profit rates to a tremendous extent (Ierko & Rudyk, 2020). Nevertheless, the company could use certain improvements in how it has been managing its service quality and, particularly, its information. By introducing innovative tools into its system and building new communication channels for interacting with its customers, Marriott Hotels will be able to become indisputable leader in the industry.

Resources and Market Opportunities

SWOT: Marriott Hotels.
Figure 2. SWOT: Marriott Hotels.

As the SWOT analysis performed above illustrates, Marriott Hotels has a powerful advantage of having been represented in the hospitality industry since 1927 (“We are Marriott International,” n.d.). Although other rival organizations, such as Hilton, can also boast a rather impressive performance record, the length of their experience in the target field does not exceed the one of Marriott Hotels significantly (“We are Marriott International,” n.d.).

In addition, brand diversification remains one of the crucial advantages that Marriott Hotels must use when developing its further business strategy. Specifically, according to the recent data, Marriott Hotels accounts for thirty different brands and eighty-one hotels globally (“We are Marriott International,” n.d.). The high rates of brand diversity indicate that Marriott Hotels has a huge potential in terms of the extent of services and customization that it can offer to its clients. Overall, Marriott Hotels appears to be heavily geared toward brand diversity, which is a crucial asset that reflects the company’s value system, specifically, its appreciation for customers’ unique needs.

Porter’s 5 Forces: Marriott Hotels.
Figure 3. Porter’s 5 Forces: Marriott Hotels.

Furthermore, Porter’s Five Forces analysis (see Fig. 3 above) has shown that Marriott Hotels is operating in the environment of high competitiveness. Since the services offered by the organization, while being luxury, are not singular, customers have a rather big bargaining power. Similarly, the extent of the threat of new entrants.

At the same time, Marriott Hotels has been limited in applying effective data management tools and innovative technology, in general. Although the organization has incorporated several interesting solutions into its framework, such as innovative tools for customer entertainment, the general situation with applying advanced tools for information management and data security has been passable, at best, at Marriott Hotels (Lo et al., 2020). Therefore, the organization should focus on exploring its options for enhancing data management.

Goals and Values

Based on the assessment above, one could presume that Marriott Hotels’ present goals and values involve meeting the needs of diverse customers and making their experience as comfortable and exciting as possible. Indeed, according to the company’s mission statement, Marriott Hotels is to ensure that its customers have a most pleasurable experience, while its associates are provided with the required range of support and opportunities (Marriott Hotels, n.d.).

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External Factors and Capabilities

Political
  • Major political tensions on the global arena;
  • Tensions within states due to the disagreements between political parties.
Economic
  • Drop in the opportunities for economic cooperation due to COVID-19;
  • Restrictions imposed on trade due to the coronavirus.
Sociocultural
  • Increased significance of social media;
  • Active demand for social justice in business (online activism)
Technological
  • Need for increased social engagement with customers;
  • Necessity to introduce new communication channels;
  • Increased role of disruptive innovations
Environmental
  • Increased threat of the pandemic;
  • Reduced number of customers due to the health threat
Legal
  • Changes in the global trade regulations;
  • Restrictions imposed on global businesses due to COVID-19

Figure 4. PESTEL: Marriott.

Addressing external issues, one should mention the devastating effects of the pandemic and the associated limitations that it has imposed on the hospitality industry. As the PESTEL analysis above shows, Marriott Hotels has suffered significantly from the limitations linked to the travel opportunities, which have reduced the number of customers for the organization. Likewise, Marriott Hotels’ supply chain has suffered extensively,

Quality Management Assessment and Recommendations

TQM

As the assessment above has shown, Marriott Hotels has been experiencing challenges in its performance over the past year due to the development of external constraints, primarily, the restrictions imposed on the global business by the regulations associated with the pandemic. Namely, the drop in the extent of travelling and, therefore, the use of hotels, has affected Marriott Hotels significantly, as its 2018 financial statements indicate (see Fig. 1). However, presently, Marriott Hotels has been dong comparatively well due to its strategic partnerships and current market leadership.

However, there are certain issues to be addressed when it comes to the quality management process. Being a luxury brand, Marriott Hotels must be particularly careful with the process of quality management and quality assessment within its context. Specifically, the services that the organization offers, including those of room service, catering, relaxation and recreation opportunities, and other options.

For this reason, the organization will have to align its service delivery system with the existing TQM principles. Specifically, in order to respond to the needs of customers as promptly and effectively as possible, Marriott Hotels will have to develop a mobile application that will allow placing orders and tracking down their delivery accurately (Aliperti & Cruz, 2020). Furthermore, the application must provide an opportunity for feedback and communication with the hotel representatives, particularly, its customer support system. Thus, Marriott Hotels will be able to improve its interaction with its target audience.

The development of a mobile app will also allow catering to the needs of an emergent yet vocal audience, specifically, Generation Z. Similarly, the integration of a mobile app that will allow keeping in touch with the target customers will help to appeal to Millennials, who also constitute a substantial part of the public that Marriott Hotels seeks to attract (Wiastuti et al., 2020). It is believed that the development of a mobile app will allow aligning Marriott Hotels’ current service quality with the existing TQM standards since it will improve the speed and efficacy of responses to the needs and requests of customers.

As a result, the levels of customer satisfaction are bound to rise once the app is deployed and starts being used by people worldwide. Moreover, the introduction of the described app into the company’s functioning will help to streamline SCM processes within the company due to improved communication with customers, thus, updating the current systems and improving relationships with target audiences (Pencarelli et al., 2020). In other words, the inclusion of the specified change will help to connect the concepts of systems, processes, and people to create a customer supplier network in accordance with the existing TQM standards.

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However, the described change will also require alterations within the company’s value system and philosophy. Specifically, Marriott Hotels will need to bolster its current awareness rates regarding the management of culture-specific needs of its customers. Although Marriott Hotels has already been placing the emphasis on diversity, it needs to take the specified notion one step further in order to retain its competitiveness and attract new audiences.

The outlined goal can be achieved by improving the communication process and promoting even greater commitment among staff members (Sifatu et al., 2020). In turn, the latter goal can be attained by offering Marriott Hotels employees additional opportunities for professional growth by incorporating talent management HRM strategies geared toward understanding and embracing employees’ needs.

Furthermore, in order to maintain its strong presence in the global market and keep its reputation of a global leader in the hospitality sector, Marriott Hotels will need to expand into other sectors, capturing them and building a presence there as a pioneer among other hospitality organizations. Specifically, Marriott Hotels should consider the idea of entering the realm of the real estate business by offering houses for lease (Chatfield et al., 2017). The specified perspective is a particularly delightful prospect for Marriott Hotels since entering the specified domain will imply a minimum of competition from its current rivals (Chatfield et al., 2017). Therefore, Marriott should consider the specified opportunity as the means of enhancing its performance.

Finally, the issue of security must be addressed as one of the vital sources of concern for the company. Recently, Marriott Hotels has received a lot of negative publicity due to its poorly handled efforts at keeping customer security, which resulted in clients’ Wi-Fi being blocked (Ho et al., 2017). Moreover, Marriott Hotels has been quite infamous for its ineffective data protection, which culminated in the hacking of the company’s database (“Marriott Hotels fined £18.4m for data breach that hit millions,” 2020).

Therefore, Marriott Hotels will need to implement the TQM model to improve its security issues. Specifically, the emphasis on improved data management must be coordinated with the focus on enhancing the security by utilizing innovative data encryption techniques. Specifically, Marriott Hotels must avoid data silos as the method of data storage despite its popularity within the hospitality industry. Due to the lack of effective security and the use of unapproved applications, data silos pose a tremendous threat to the safety of customer data (Ho et al., 2017). Combined with the focus on innovation, particularly, the application of disruptive innovations in its context, Marriott Hotels will be able to deploy the TQM model successfully.

ISO9000

Currently, Marriott Hotels has been meeting the ISO 9001 standards quite effectively, delivering luxury services to its target customers. Specifically, the company has received the ISO 50001 certification recently, which indicates that Marriott Hotels has been following innovative approaches to quality management approved by the ISO quality standards (“JW Marriott Washington DC achieves certification to the new ISO 50001 – Energy management systems standard,” 2013). However, certain issues still need to be addressed in order for the organization to keep its competitiveness and maintain a strong advantage in the hospitality market.

Global Best Practices

For Marriott Hotels to succeed at updating its current quality management strategy, one may recommend using the systemic approach. Specifically, the proposed strategy will be beneficial for quality management planning as the means of embracing key risks that may emerge in other areas of the company’s functioning yet affect the quality of the services delivered to the customers. For example, the systemic approach will allow connecting the SCM process to the task of quality management by determining the threat of data mismanagement and, therefore, poorly delivered services.

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Likewise, the systemic approach will help to connect information and communication management to the improvement of the service quality. Most importantly, the issue of data security and the application of technological advances for enhancing information security will allow minimizing the threat of cyberattacks, thus, keeping customers’ data safe. Given Marriott Hotels’ history of mismanaging private data security, the proposed change will be vital in the company since it will open new opportunities for reducing the exposure to cyber threats (Ho et al., 2017). Likewise, other areas such as R&D, specifically, the focus on integrating innovative tools for communication and data management, will be explored in conjunction to other processes within the organization, thus helping Marriott Hotels to form a perfect customer service based on immediate response and all-encompassing risk assessment.

Conclusion

Throughout the history of its performance, Marriott Hotels has managed to keep a mostly excellent score due to its focus on people, particularly, customers and their needs. However, for the organization to remain competitive in the post-COVID-19 era, when the economic setting has become particularly competitive and challenging, the organization will need an additional effort. Namely, its current lack of technological perfection, particularly, in its management of customer data safety and information security, must be addressed accordingly.

Likewise, the speed and efficacy of responses toward customers’ feedback could be improved, which is why integrating a mobile app into Marriott Hotels’ functioning will be needed to improve the existing communication channel. Likewise, the suggested change will enhance the SCM processes and allow the organization to deliver its services with greater efficacy. Overall, by placing a greater emphasis on the issues of diversity and incremental technological innovation, Marriott Hotels will be able to flourish even in the current setting of economic crisis.

References

Aliperti, G., & Cruz, A. M. (2020). Promoting built-for-disaster-purpose mobile applications: An interdisciplinary literature review to increase their penetration rate among tourists. Journal of Hospitality and Tourism Management, 44, 193-210.

Chatfield, H. K., Chatfield, R. E., & Poon, P. (2017). Is the hospitality industry ready for the new lease accounting standards? The Journal of Hospitality Financial Management, 25(2), 101-111.

Ho, T., Zhao, J., & Dooley, B. (2017). Hotel crimes: An unexplored victimization in the hospitality industry. Security Journal, 30(4), 1097-1111.

Ierko, I., & Rudyk, A. (2020). Ecological marketing as a tool of strategy of hotel business and tourism development. Economic Journal of Lesia Ukrainka Eastern European National University, 3(23), 77-83.

JW Marriott Washington DC achieves certification to the new ISO 50001 – Energy management systems standard. (2013). Web.

Lo, A., Yeung, P., & Cronin, J. (2020). Will “The spirit of discovery” lead Wharf Hotels to become a preferred international hotel brand? Asia Pacific Journal of Tourism Research, 25(10), 1109-1127.

Marriott International, Inc. (MAR). (2021). Web.

Marriott Hotels. (n.d.). We put people first. Web.

Marriott Hotels fined £18.4m for data breach that hit millions. (2020). BBC. Web.

Pencarelli, T., Gabbianelli, L., & Savelli, E. (2020). The tourist experience in the digital era: The case of Italian millennials. Sinergie Italian Journal of Management, 38(3), 165-190.

Sifatu, W. O., Sjahruddin, H., Fajriah, Y., Dwijendra, N. K. A., & Santoso, A. (2020). Innovative work behaviors in pharmacies of Indonesia: Role of employee voice, generational diversity management and employee engagement. Systematic Reviews in Pharmacy, 11(2), 725-734.

Wiastuti, R. D., Lestari, N. S., Ngatemin, B. M., & Masatip, A. (2020). The generation Z characteristics and hotel choices. African Journal of Hospitality, Tourism and Leisure, 9(1), 1-14.

We are Marriott International. (n.d.). Web.

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