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Case 24Shangri-La Hotels

1. The key element of strategy implemented by Shangri-La Hotel in gaining competitive advantage over its rivals is by offering services that are superior value worth paying more for. Shangri-la uses its signature standard of “Shangri-La Hospitality” in achieving an edge or competitive advantage over rivals in attracting buyers and coping with competitive forces. A company’s competitive strategy deals exclusively with the specific of management’s game plan for competing successfully, its specific effort to please customers, its offensive and defensive moves to counter maneuvers of rivals, its responses to whatever market conditions prevail at the moment, its initiatives to strengthen its market position, and its approach to securing a competitive advantage vis-à-vis rivals. There are five types of generic competitive strategies that can be adopted by organizations to suit their strategic vision, mission and objectives. In the case of Shangri-La Hotel, they are adopting the generic competitive strategy of focused differentiation strategy targeting a narrow market segment or market niche. Shangri-La Hotel as a leading player in the luxury hotel industry adopt a focused strategy keyed to differentiation aims at securing a competitive advantage with its signature standard of “Shangri-La Hospitality” a service model based on traditional Asian hospitality. Fulfilling the needs of a narrow and well-defined group of buyers. The market niche of Shangri-La Hotel is the group of buyers with high level of income and buyer who prefer luxury services and standards. Shangri-La Hotel is a rapidly expanding international deluxe hotel rooms with 50 hotels across south-east Asia, Europe and North America and Bridle, and still expanding their market towards China. Shangri-La’s international strategy in fitting specific market conditions and buyers preferences is think-global, act-global approaches. In expanding, its market worldwide which includes Asia, Europe and North America, Shangri-La still maintains it “Shangri-La Hospitality” during the expansion of their business. All of their hotels are luxury service hotel with distinctive Asian standards of hospitality and service.

2. A Shangri-La Hotel distinction feature from other hotels is its signature standard in their Asian traditional hospitality services provide for their customers. The service model of “Shangri-La Hospitality” has a stated mission which is to “delight customers each and every time.” Its mission statement makes a clear picture of how they are focusing and prioritize its hospitality service to care and delight their customer in exchange for their loyalty. The core element of their distinctive service is to “offer customers an unforgettable experience by blending local cultures, exotic art, and lively ambience. Besides that, Shangri-La’s service model of “Shangri-La Hospitality” was built around five core principles which are respect, humility, courtesy, helpfulness, and sincerity. This five core principles are implemented across all their geographic and cultural markets. In management perspective, Shangri-La used a five level organization design. In this practice, they divide its employees into five tiers which consist of Level 1(divisional managers), Level 2 (departmental manager), Level 3 (sectional managers), Level 4 (front-line supervisors) and Level 5 (front-line employees). Each of these tiers has their own separate guidelines, discretion and dollar amount that they could use. In order to maintain it signature standard in providing excellence service, Shangri-La has its own Training and the Shangri-La Academy. It is first open in 2004 in China. It is their efforts in standardizing the delivery of its brand promise throughout its network of hotels worldwide. The Shangri-La Academy is equipped with full training facilities and varied from five-week to tree-month training programs. 3. Company training is the most important thing that...
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