Reference no: EM133460869

Case Study: Case The case study organisation is one of the largest international hotel chains operating in more than one hundred countries with its internationally recognised brands. However, the company does not have a culturally diverse workforce at the senior level. It usually recruits executives to the key decision-making positions either from the United Kingdom or the United States. In this respect, it is defined as Anglo-Saxon. Some people argue that the company should get the best from other nationalities involved in the development of an organisation's strategy. Different nationalities holding senior positions in the company would not only facilitate the organisation's understanding about foreign markets but would also help the company to start thinking more in a non-Anglo-Saxon way of doing business in different country markets. Indeed, in this organisation, the U.S. and U.K. activities have been used as benchmarks for doing business in other country markets. There is an attempt to adapt the brand standards to the local market conditions. However, the main goal is to standardise the products regardless of the differences between home and host country markets. Senior decision makers make it clear that the organisation aims to standardise their products and services like Mcdonald's and Coca-Cola have done in the fast-food and drink industries, respectively. It is a common belief that the organisation should be aiming for a certain degree of standardisation because international customers have a certain perception of the brand and its attributes. The organisation's purpose is to achieve international standardisation and benefit from economies of scale. There is also a strong desire to force potential partners for franchise, management contracting, and joint venture partnerships to join the standardised network of operations and contribute to the conformity in hotel product standards. The argument usually put to the potential partners is "We have a proven record, and we will be willing to let you benefit from our internationally recognised brand and infrastructure if you acknowledge our inherent superiority and accept our methods and conditions of doing business." Moreover, a certain degree of standardisation is driven by the belief that markets are converging. It is believed that everything is in transition, and cultures are becoming similar. The phrase "If the United States does this and the United Kingdom accepts this, why doesn't Italy or Spain?" clearly manifests the philosophy of strategy dominance in the organisation. This corporation's overall strategy is facing strong resistance in different country markets due to fundamental differences in the ways hoteliers do business in different country markets. The cultural distance between the organisation's way of doing business and the intended foreign market exposes a threat for the organisation's international expansion attempts in Europe, including Spain, Italy, and Germany. One of the business analysts criticized the company for being financially driven, short- term-oriented, Anglo-Saxon ignorant of issues in the local market. It is apparent that the organisation should try to adapt to the local market conditions rather than trying to rigidly implement the organisation's traditional strategy and standards that were brought from the United States.

Discussion Questions

1. How would you describe the case study organisation's strategy in international perspective? Please illustrate your answers by providing evidence from the case study.

2. What are the organisation's reasons for adopting such a strategy?

3. Do you think it is a feasible strategy to implement given the cultural distance between different country markets? Why or why not?

4. What are the implications of adopting a home country-oriented strategy? What changes would you recommend?