BM633 Strategic Agility

Student Name:

Student ID:

1
Table of Contents
Introduction.................................................................................................................................. 2
The strategic position of the Oak Tree Inn...................................................................................4
Internal Factors: Strengths & weaknesses...............................................................................4
Competitiveness of the Hospitality Sector....................................................................................5
Macro environmental Analysis of Recent Events.........................................................................6
Two potential Growth Strategies..................................................................................................7
1. Diversification:................................................................................................................... 7
2. Acquisition:........................................................................................................................ 7
Evaluation Of The Growth Strategies...........................................................................................8
Conclusion................................................................................................................................... 9
Reference.................................................................................................................................. 10

Introduction
The hospitality sector is a broad category of fields within the service industry that includes
lodging, event planning, theme parks, transportation, cruise line, and other fields within the

2
tourism industry. The hospitality sector is a critical part of many economies, providing jobs and
revenue (Ampofo and J.A., 2020). The Oak Tree Inn is a great place that is close to the beach
and has a lot of amenities. The staff is friendly and the rooms are clean and comfortable. The
main macro environmental challenge that Oak Tree Inn faces is competition from other hotels
and businesses in the area. To compete, the Oak Tree Inn needs to offer something unique that
will draw customers in.

3
The strategic position of the Oak Tree Inn
The Oak Tree Inns’ strategic position is to provide a comfortable and affordable place for people
to stay. The company has a strong focus on customer service and providing a clean and
comfortable environment for guests (Lee et al., 2020). The company has a strong brand identity
and is well-known for its affordable prices. According to SWOT analysis, its internal factors
which are strengths and weaknesses are described below:

Internal Factors: Strengths & weaknesses

The Oak Tree Inn is a hotel located in the heart of downtown Los Angeles. The hotel has a
unique location that allows guests to enjoy the sights and sounds of the city. The hotel has a
swimming pool, a fitness center, and a business center. The hotel also offers a variety of dining
options, including a restaurant, a bar, and a cafe. The Oak Tree Inn is a great choice for
travelers who want to experience the best of Los Angeles. The Inn is situated on a beautiful
piece of property that includes a large pond, multiple gardens, and a gazebo. The Inn has 28
guest rooms, each of which is uniquely decorated and includes a private bathroom. The Oak
Tree Inn also has a restaurant on site that serves breakfast, lunch, and dinner. In addition, the
Inn has a large banquet hall that can accommodate up to 200 people. The Oak Tree Inn is a
popular destination for weddings, corporate events, and family gatherings. The staff at the Inn is
friendly and accommodating, and the Inn has a reputation for providing a high level of customer
service. SWOT analysis of the Oak Tree Inn highlights several weaknesses that should be
addressed. The business is highly dependent on its location and would be significantly impacted
by any changes to the local area. Also, the business has a limited target market and is therefore
vulnerable to changes in consumer tastes.

4
Competitiveness of the Hospitality Sector
The hospitality sector in the UK is highly competitive, with many businesses vying for a share of
the market. The sector is worth an estimated £127 billion to the economy and employs over 3
million people (Chowdhury et al., 2022). There are several reasons for the high level of
competition in the hospitality sector. Firstly, the sector is relatively easy to enter, meaning that
many small businesses are competing for market share. Secondly, the sector is highly labor-
intensive, meaning that businesses have high running costs. Finally, the sector is very seasonal,
with demand fluctuating throughout the year. This makes it difficult for businesses to maintain a
consistent level of turnover. Despite the challenges, the hospitality sector in the UK continues to
grow. In the last five years, the sector has grown by 3.7% in real terms. This growth is driven by
several factors, including the strong performance of the economy, the increasing number of
tourists visiting the UK, and the growing popularity of the ‘staycation’. The Loch Lomond area is
a particularly popular tourist destination, and as such, the hospitality sector is very competitive
here. Businesses must offer a high level of service and value for money to stand out from the
crowd. It is because the sector is highly labor-intensive which makes it difficult for businesses to
maintain a consistent level of turnover. Despite the challenges, the hospitality sector in the UK
continues to grow. This growth is driven by several factors, including the strong performance of
the economy, the increasing number of tourists visiting the UK, and the growing popularity of the
‘staycation’ (Drummond and F.j., 2021).

The Oak Tree Inn is a competitive Inn that offers a variety of amenities to its guests. The Inn is
located in a convenient location that is close to many attractions. The Inn offers a variety of
room types and rates that are competitive with other Inns in the area. The Inn also offers a
variety of services and amenities that are designed to meet the needs of its guests. The Oak
Tree Inn is a competitive Inn that offers a variety of amenities to its guests.

5
Macro environmental Analysis of Recent Events
The hospitality sector is facing several challenges at the moment, as a result of several recent
events. The war in Ukraine has led to a spike in global fuel prices, which has in turn led to a cost
of living crisis in the UK. This has made it difficult for people to afford to go on holiday and has
also resulted in a recruitment crisis in the hospitality sector (Papadopoulos et al., 2021). The
war in Ukraine has led to several hospitality businesses in the country having to close their
doors, as tourists have been put off by the violence. This has had a knock-on effect on
businesses in neighboring countries, as well as those further afield who had been relying on
Ukrainian tourists. The spike in global fuel prices has also had an impact on the hospitality
sector, as businesses have had to increase their prices to cover the increased costs. This has
led to a decrease in demand for hospitality services, as consumers have been forced to cut
back on their spending. The cost of living crisis in the UK has also hit the hospitality sector hard,
as businesses have had to increase prices to cover the increased costs of running their
businesses. This has led to a decrease in demand for hospitality services, as consumers have
been forced to cut back on their spending. The recruitment crisis in the hospitality sector has
also had a negative impact on businesses, as they have struggled to find staff to fill vacant
positions. This has led to an increase in prices, as businesses have had to offer higher wages to
attract staff. The change in UK Prime Minister has also had an impact on the hospitality sector,
as businesses have been uncertain about the future direction of the country. This has led to a
decrease in demand for hospitality services, as consumers have been reluctant to commit to
spending money on non-essential items.

The first opportunity that has arisen (Fusté-Forné and F., 2021). This has created an opportunity
for the hospitality sector to offer cheaper holidays, which will appeal to a wider range of people.
In addition, the recruitment crisis has created an opportunity for the hospitality sector to offer
training and development opportunities to people who are looking for a career in the sector.

The main threat to the hospitality sector at the moment is the fact that people are not spending
as much money on holidays. This is having a negative impact on the sector and is likely to lead
to job losses and a reduction in the number of businesses operating in the sector. In addition,
the change in Prime Minister has led to a change in the way the hospitality sector is regulated,
which could lead to more restrictions being placed on the sector.

6
Two potential Growth Strategies
The Oak Tree Inn is a hotel chain that has been in operation for over 20 years. The company
has a total of 12 hotels, all of which are located in the United Kingdom. The company has been
profitable for the past few years, but the owners are looking to grow the business even further.
They are considering two potential growth strategies: diversification and acquisition.

1. Diversification:
Diversification is a growth strategy that involves expanding the product offerings and
markets that a company serves. The goal of diversification is to reduce the risks associated
with relying on a single product or market (Shahzad et al., 2021). By diversifying, companies
can reduce their vulnerability to changes in consumer preferences, economic conditions,
and other factors that can impact sales. There are two primary types of diversification: 1.
Product diversification: This involves expanding the types of products that a company offers.
For example, a company that primarily sells computers may diversify by adding a line of
computer accessories. 2. Market diversification: This involves expanding into new markets.
For example, a company that sells products in the United States may expand into Canada
or Europe. Diversification can be an effective growth strategy, but it also comes with some
risks. One risk is that the company may not have the resources to successfully enter new
markets or develop new products. Another risk is that the company may spread itself too
thin and lose focus on its core business.

2. Acquisition:
The acquisition is a growth strategy that involves one company purchasing another
company. The goal of an acquisition is to quickly expand the acquiring company’s product
offerings, market share, or both (Luo et al., 2019). Acquisitions can also be used to gain
access to new technology or talent. There are two primary types of acquisitions: 1.
Horizontal acquisition: This involves acquiring a competitor in the same market. For
example, a company that makes software for small businesses may acquire a competitor
that makes software for medium-sized businesses. 2. Vertical acquisition: This involves
acquiring a company that is involved in a different stage of the same value chain. For
example, a company that makes computer hardware may acquire a company that provides
technical support services. Acquisitions can be an effective growth strategy, but they also
come with some risks. One risk is that the acquiring company may overpay for the target

7
company (Baldi et al., 2022). Another risk is that the two companies may have difficulty
integrating their operations and cultures.

8
Evaluation Of The Growth Strategies
The owners of The Oak Tree Inns will need to carefully consider both of these growth strategies
which are mentioned earlier before making a decision. They will need to weigh the risks and
rewards of each option and decide which one is the best fit for their company.

There are several potential growth strategies that The Oak Tree Inn could pursue, but
diversification is likely the most promising. By diversifying its product offerings and expanding
into new markets, The Oak Tree Inn can mitigate the risks associated with relying on a single
product or market (jeong et al., 2022). Additionally, diversification can help The Oak Tree Inn to
tap into new sources of revenue and grow its business. The Oak Tree Inn will need to carefully
consider its expansion plans to ensure that it does not spread itself too thin. Additionally, The
Oak Tree Inn will need to be mindful of the potential for cannibalization if it expands into markets
that are too similar to its existing business. However, it is important to carefully consider the
risks and opportunities associated with this strategy before moving forward.

Another potential growth strategy is the Acquisition strategy. The Oak Tree
Inn requires some updating and the owners are considering acquisition as a growth strategy.
There are several things to consider when evaluating the potential acquisition. The inn is
profitable, but the owners have been reinvesting profits back into the business rather than taking
any out for themselves. This has left them with a limited amount of cash on hand to make a
purchase. They would likely need to take out a loan to finance the acquisition, which would
increase their debt load and put them at risk if the inn’s profitability declined. The Oak Tree Inn
is located in a rural area and the majority of its guests are from the local Amish community.
While there is some tourism in the area, it is not a major destination. This limits the potential for
growth for the inn and makes it less likely that an acquisition would be a successful strategy
(Bryan et al., 2020).

9
Conclusion

The Oak Tree Inn is a hospitality firm that is currently facing some macro environmental
challenges. One of the biggest challenges that the company is facing is the increasing
competition from other hospitality firms (Köseoglu et al., 2020). The company is also facing
some challenges with its customer base, as some customers are beginning to look for more
affordable options. To address these challenges, the company has formulated some strategic
options. One option is the diversification of products for its customers. The company is also
considering expanding its operations into new geographic markets. Another option is to focus on
expanding its customer base by targeting new markets.

10
Reference
Ampofo, J.A., 2020. Contributions of The hospitality industry (Hotels) in the development of Wa
municipality in Ghana. International Journal of Advanced Economics, 2(2), pp.21-38.

Baldi, F. and Salvi, A., 2022. Disentangling acquisition premia: Evidence from the global market
for corporate control. Finance Research Letters, 48, p.102885.

Bryan, K.A. and Hovenkamp, E., 2020. Startup acquisitions, error costs, and antitrust
policy. The University of Chicago Law Review, 87(2), pp.331-356.

Chowdhury, E.K., Khan, I.I. and Dhar, B.K., 2022. The catastrophic impact of Covid‐19 on the
global stock markets and economic activities. Business and Society Review, 127(2), pp.437-
460.

Drummond, F.J., 2021. The role of tourism in small town cultural and creative industries
clustering: The Sarah Baartman District, South Africa. In Urban tourism in the global south (pp.
213-237). Springer, Cham.

Fusté-Forné, F., 2021. Street food in New York City: Perspectives from a holiday market. International
Journal of Gastronomy and Food Science, 24, p.100319.
Jeong, I., Jean, R.J.B., Kim, D. and Samiee, S., 2022. Managing disruptive external forces in
international marketing. International Marketing Review, (ahead-of-print).

Köseoglu, M.A., Altin, M., Chan, E. and Aladag, O.F., 2020. What are the key success factors
for strategy formulation and implementation? Perspectives of managers in the hotel
industry. International Journal of Hospitality Management, 89, p.102574.

Lee, S.M. and Lee, D., 2020.Contactct”: a new customer service strategy in the digital
age. Service Business, 14(1), pp.1-22.

Luo, X., Tong, S., Fang, Z. and Qu, Z., 2019. Frontiers: Machines vs. humans: The impact of
artificial intelligence chatbot disclosure on customer purchases. Marketing Science, 38(6),
pp.937-947.

Papadopoulos, O., Lopez‐Andreu, M. and Jamalian, M., 2021. Violation and lack of awareness
of employment rights in the United Kingdom's hotel industry: Isolation, fragmentation and
barriers to labour enforcement. Industrial Relations Journal, 52(4), pp.315-330.

11
Shahzad, U., Doğan, B., Sinha, A. and Fareed, Z., 2021. Does Export product diversification
help to reduce energy demand: Exploring the contextual evidence from the newly industrialized
countries. Energy, 214, p.118881.

12