An organization’ s situational analysis will reveal the internal environmental conditions, which are reflected in its strengths and weaknesses as well as the opportunities, and threats, which the company should pursue or manage through the utilization of its resources and strengths. A company’ s internal environment consists of its human resource, capital, technology, equipment, markets, and materials. These are commonly referred to as the “ Five M’ s” – Men, Money, Machinery, Material, and Markets. An internal environmental audit will indicate where the company needs to improve upon and what strengths can be utilized to optimise the available opportunities and which threats have to be countered or avoided. Hilton Hotels strategic situational analysis can be assessed through a SWOT analysis, which can facilitate decisions on, how the company can best align its resource base to take advantage of the business opportunities while safeguarding against the threats.
SWOT analysis finding should be used in developing those weakness areas by strengthening the internal deficiencies and building required core competencies (Duncan, Ginter & Swayne 1998). Strengths of the company lie in the highly reputed brand name of the Hilton Hotel Group and its affiliated hotel brands as Conrad.
The Financial stability of the company which is reflected in the above average profit generations is also a key strength. The 9 months performance in 2005 reported net income of $355 million, compared to $173 million in the 2004 period. Availability of funds for aggressive expansion plans facilitates growth. The year 2006 capital investments commitment is approximately US$ 500 million. Expansion plans are to add further 175-200 hotels and 23,000-27,000 rooms to the network of hotels during the year 2006.
Among the company’ s key strengths, the established business processes which have been streamlined for efficiency and cost-effectiveness is also of importance.
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