The Hillerman Hotel Case Study
Problem 1:
What to do with the property?
The first problem in the case is deciding what to do with the property. The owners have the option of selling the hotel or keeping it open for business. This problem is time sensitive because new competitors are entering the market rapidly. “Approximately 28 hotels were under construction and an additional 25 in permit stages for a total of 53 projects under development”. (Cornsun & Enz, p. 21). The Hillerman Hotel Executive Board will need to choose an option soon. The tool/concept that will be used to solve this problem is the hold and maintain strategy. The essence of this strategy is a good defense, which makes it harder for new firms to enter and for challengers to gain ground, lowers the probability of attack, lessens the intensity of attack, or diverts attack to less threatening arenas (Popescu, 2008, p. 4). The purpose of the hold and maintain strategy is to protect the company’s position in the industry by strengthening competencies.
After reading the case and looking at the business life cycle, which is the movement of a firm through stages of development, growth, expansion, maturity, saturation, and decline (Business Life Cycle), this company is in the mature phase and is doing very well. Although it is a seller’s market, there is no reason to sell a high performing business, at this point, that will prove to still be a top competitor in the industry. The hold and maintain strategy should be used by businesses who are leaders and dominant in their field. The Westward is at the top of the industry for their target market of the business transient segment and is financially healthy. Hillerman will stick to their competencies, which are customer service and guest satisfaction.
With proper implementation of the hold and maintain strategy, Hillerman will arrive at the conclusion to not sell the property and maintain its place in the industry by strengthening themselves and competing with the new businesses.
What to do with the property?
The first problem in the case is deciding what to do with the property. The owners have the option of selling the hotel or keeping it open for business. This problem is time sensitive because new competitors are entering the market rapidly. “Approximately 28 hotels were under construction and an additional 25 in permit stages for a total of 53 projects under development”. (Cornsun & Enz, p. 21). The Hillerman Hotel Executive Board will need to choose an option soon. The tool/concept that will be used to solve this problem is the hold and maintain strategy. The essence of this strategy is a good defense, which makes it harder for new firms to enter and for challengers to gain ground, lowers the probability of attack, lessens the intensity of attack, or diverts attack to less threatening arenas (Popescu, 2008, p. 4). The purpose of the hold and maintain strategy is to protect the company’s position in the industry by strengthening competencies.
After reading the case and looking at the business life cycle, which is the movement of a firm through stages of development, growth, expansion, maturity, saturation, and decline (Business Life Cycle), this company is in the mature phase and is doing very well. Although it is a seller’s market, there is no reason to sell a high performing business, at this point, that will prove to still be a top competitor in the industry. The hold and maintain strategy should be used by businesses who are leaders and dominant in their field. The Westward is at the top of the industry for their target market of the business transient segment and is financially healthy. Hillerman will stick to their competencies, which are customer service and guest satisfaction.
With proper implementation of the hold and maintain strategy, Hillerman will arrive at the conclusion to not sell the property and maintain its place in the industry by strengthening themselves and competing with the new businesses.
Bibliography: Business Life Cycle. (n.d.). Retrieved October 28, 2009, from All Business: www.allbusiness.com/glossaries/life-cycle/4942437-1.html. Cornsun, P. D., & Enz, P. C. Living A Vision At The Hillerman Hotels. Popescu, C. (2008). Generic Business Strategies.