Hong Kong Peninsula’s OLI study of Qatar market
Hong Kong Peninsula’s OLI study of Qatar market
1 Ownership Advantages
According to Dunning's eclectic OLI framework [1993], the ownership specific advantage is talking about control issue such as cost, benefit and risk of inter-firm relationships. These issues can be justified as three elements: Firm Size, Multinational Experience, and Ability to develop differentiated Products. Dunning and McQueen [1981] also point out that the foundation of the firm entering new market is able to acquire income generating assets. Referring to Peninsula, it is a famous hotel chain under a big company which means it has enough capital and tangible resource to support the cost of enter foreign market. Also, the sustainable investment maybe in needed so capital is a big factor of entering new market and Peninsula can gain more competitive advantage by enough capital. This advantage can support Peninsula using acquisition as the entry method to enter Qatar market. Moreover, Peninsula has very good reputation on its service but it only has nine hotels operating at this moment. The reason is it needs to keep high control on the hotel operation to maintain the service quality and brand image. Therefore, the entry mode of foreign market must fit the Peninsula’s operating philosophy and the acquisition would be the best placed of choice. The Peninsula can enter the market quickly by acquisition and maintain intensive control on hotel operation. However, Qatar is a country located at Arabian Peninsula and it has very different culture and operating environment comparing to Asian and Europe. The Peninsula may need to invest time and resource to understand the culture, tradition, diet, religion such target markets requirement. Understanding the requirement is the soul of producing good service quality. Thus, it is essential for Peninsula to do this.
Another relevant factor of ownership specific advantage is the sourcing capability, which related to the Peninsula’s intangible
1 Ownership Advantages
According to Dunning's eclectic OLI framework [1993], the ownership specific advantage is talking about control issue such as cost, benefit and risk of inter-firm relationships. These issues can be justified as three elements: Firm Size, Multinational Experience, and Ability to develop differentiated Products. Dunning and McQueen [1981] also point out that the foundation of the firm entering new market is able to acquire income generating assets. Referring to Peninsula, it is a famous hotel chain under a big company which means it has enough capital and tangible resource to support the cost of enter foreign market. Also, the sustainable investment maybe in needed so capital is a big factor of entering new market and Peninsula can gain more competitive advantage by enough capital. This advantage can support Peninsula using acquisition as the entry method to enter Qatar market. Moreover, Peninsula has very good reputation on its service but it only has nine hotels operating at this moment. The reason is it needs to keep high control on the hotel operation to maintain the service quality and brand image. Therefore, the entry mode of foreign market must fit the Peninsula’s operating philosophy and the acquisition would be the best placed of choice. The Peninsula can enter the market quickly by acquisition and maintain intensive control on hotel operation. However, Qatar is a country located at Arabian Peninsula and it has very different culture and operating environment comparing to Asian and Europe. The Peninsula may need to invest time and resource to understand the culture, tradition, diet, religion such target markets requirement. Understanding the requirement is the soul of producing good service quality. Thus, it is essential for Peninsula to do this.
Another relevant factor of ownership specific advantage is the sourcing capability, which related to the Peninsula’s intangible