1. Chapter 4

2. Chapter 4_Strategic Management Model
Remote
Industry
Task
Firm
Functional
Environmental Events

3. Identifying Events in the Environment
Major Trend a consistent pattern of events- all firms
invest in critical
success factors
All firms in the sector have invested in the CM
Leading firms adopt and invest in the new CM
Innovator/ Entrepreneur creates a new CM
Ideal Scanning Window
Evidence of use by leaders
A pattern is emerging
Introduction of new CMs
Fads Innovations Major Trend Fact of Life
Innovation / CM Life Cycle

4. Establishing an Environmental Scanning System
Establish domain definition
Organizational structure issues
Determine information needs - quantitative and qualitative
Determine information mediums
Assess timing of information
Identify sources
Choose scanning activities - regular and irregular
Determine analysis and synthesis processes
Determine information sharing
Establish information feedback and evaluation systems

5. Criteria of the Domain Definition
Elements of domain
Geographic market area
Segment defined by competitive methods made up of the
mix of product and service attributes
Primary competition
Major descriptors of target market
Industry structure
Existing competitors, potential competitors, substitutes,
suppliers and buyers
Determine interdependencies
Relationships with suppliers, competitors
Relationships among different environmental categories
Primary and secondary relationships (hierarchical)

6. Examples of Quantitative Information Primary and Secondary Demand Generators
Primary Demand Generators
Population
Housing
Transportation
Industry
Health facilities
Education facilities
Recreational facilities
Special events
Attractions
Income levels
Secondary Demand Generators
Business travelers
Conventions and meetings
Incentive travel
Government
Military
Fraternal groups
Pleasure travelers
Airline business
Sports teams
Special events

7. A Sampling of Disciplines and Fields of Study Contributing to the Body of Knowledge in the Hospitality Industry
Economics
Ecology
Food Science
Nutrition
Organizational Behavior
Organization Theory
Political Science
Psychology
Technology
Sociology
Statistics
Accounting
Finance
Management Information Systems
Human Resources
Linguistics
Marketing
Management Science
Operations
Engineering
Strategic Management

8. Common Information Sources Available to the Hospitality Manager
Quantitative and Qualitative Information
Personal
Researchers
Internal personnel
Consultants
Suppliers
External business associates
Friends and family
Non-personal
Conferences
Seminars
Trade Associations
Trade Magazines
Newsletters
News services
On-line services
Newspapers
News Magazines
Government statistics
Government reports
Internal research
Databases

9. Evaluating the Quality of Information Sources
Event or
Trend
Top Three Sources
Timing
Estimate of Validity
& Reliability
Influence on
Strategic
Thinking
Asset
and
Capital
Wall Street Journal
Daily
Excellent in short term
Very strong
Business Week
Weekly
Strong
Economist
Excellent in both short
and long term

10. Scanning the Remote, Task and Functional Environment Categories

11. Scanning Monthly Updates Major Events Updates January February :
December
Key investor is seeking seat on the Board
Lender raises concern over competitive position given new competitors in the market place
Interest rate rise
Institutional investors show concern over industry performance

12. Catpac Content Analysis Software Analysis of Marriott International’s Annual Reports
A F F I J V P I F F B R C R C D L O S S D O G R T
G R A N O E R N U E R O L E O E I P E E I W R O I
R A C V I N O V T E A O U S M V V E N R S N O O M
E N I E N T G E U S N M B O M E I R I V T E W M E
E C L S T U R S R . D . . R U L N A O I R R T S S
M H I T . R A T E . S . . T N O G T R C I S H . H
E I T M . E M M S I P . I . E B A
N S I E E T M . O . S U R
T E E N N I E . N . . T E
S . S T T E N . S . . I
. . . S S T O N
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13. Concept Map of Environmental Event
Investor Perspective
Regulator Perspective
Asset Productivity
Private capital rationing
Government capital rationing
New expectations
for asset performance in an era of capital shortages
New pressures for publicly traded firms
Private
and closely held firms
Growing Influence of capital market community
Regional Influences

14. - Threat or Opportunity
Environmental Analysis Worksheet Key Issues Affecting the Firm in the Regulatory Environment
Regulators
List and Describe
Key Issues
Firm Position
- Threat or Opportunity
Competitor Position
on Each Issue
International
Growing regulation of copyright rules in playing recorded music
Threat creating greater cost and less flexibility
Same as ours
Federal
Regulations on fire and safety issues in hotels
Opportunity because we are ahead of the competition here
In general most are behind on complying
State
State taxation laws supporting local taxes on travelers.
Threat - to be resisted or to obtain better services for tax collected
Same
Local
Local ordinances on food safety increasing
Opportunity to showcase company standards in this area`
In general most are behind in this area

15. Environmental Event
Business Customer
Leisure Customer
Socio-cultural
Political
Economic
Technological
The evolution of technology which includes the use of the information highway to access travel and reservations information as well as interactive learning and room environmental control.
Customer expects complete access to information highway through data ports conveniently located in the guestroom.
Customer expects to make reservations utilizing the Internet.
Customer expects to be able to make reservations using the Internet.
Wants secure surroundings which rely in part upon technology.
Customer desires a comfort room regarding air quality and living environment maintained by the latest technology.
Ecological

16. Environmental Category
Environmental Analysis Relationship Worksheet Task Environment vs. Remote Environment
Environmental Category
Customers
Suppliers
Competitors
Regulators
Economic
Rising disposable income results in increases in eating out sales
Greater competition for capital and labor
More disposable income brings about too many competitors
Political
Increased regulation of packaging and advertising
Socio-cultural
A customer less tolerant of smoking
Increasing numbers of competitors focusing on cultural values
Ecological
Greater awareness of a firm’s practices
More eco-friendly products available
Limitations on drive thru windows in urban areas
Technological
Growing reliance upon technology in making purchase decisions
Seamless integration and product delivery due to MIS
Growing importance of technology as a competitive advantage

17. Information Sharing Feedback and Evaluation Systems
Executive
Level
Functional
Level
External
Level
Operations
Level