BM633 Strategic Agility Module leader

[DATE]
[COMPANY NAME]
[Company address]
Executive summary:
This study analyzes and evaluates a hotel sector organization's leading performance indicators
and competitive advantages. The academic analysis of Oak Tree Inn examines vital facets of
the organization's structure and performance. The PESTLE, Porter's, and VRIO studies all look
at the environment both internally and outside, and their comparative research helped to
uncover the opportunities and dangers that the tourist industry is facing. The study examines
the options open to the business in order to establish and preserve a competitive edge in the
market. Directors may choose for this strategy if they think it would help the company achieve
its goals while increasing its vulnerability to assault in the cutthroat tourism market.
Table of Contents
Executive summary:..............................................................................................................................1
Introduction:............................................................................................................................................2
Background:........................................................................................................................................3
External analysis:...................................................................................................................................3
PESTEL Analysis:...............................................................................................................................3
Political:............................................................................................................................................3
Economic:.........................................................................................................................................3
Social:................................................................................................................................................3
Technological:.................................................................................................................................3
Legal:.................................................................................................................................................4
Environmental:................................................................................................................................4
Porter’s five forces model:...................................................................................................................4
Bargaining power of supplier:.........................................................................................................5
The Threat of new entrants:.............................................................................................................5
Threats of substitute:........................................................................................................................5
Bargaining power of buyers:...........................................................................................................5
Rivalry among competitors:.............................................................................................................5
Internal Analysis:....................................................................................................................................5
VRIO Analysis:....................................................................................................................................5
SWOT Analysis:......................................................................................................................................6
Strengths:.............................................................................................................................................6
Weakness:............................................................................................................................................6
Opportunities:.....................................................................................................................................6
Threats:.................................................................................................................................................6
Strategic choices:...................................................................................................................................7
Company’s merger:............................................................................................................................7
Expansion scope:...............................................................................................................................7
SFA Matrix:...............................................................................................................................................7
Recommendations:................................................................................................................................8
References...............................................................................................................................................9
Introduction:
The management practises at Oak Tree Inn are examined in this essay. Examining and
analysing Oak Tree Inn's current business situation in light of both internal and external
competitive challenges. Two courses will be overwhelmingly provided for management to select,
and Oak Tree Inn will put one of these plans into effect (Armstrong, 2017).

Background:
Sandy and Lucy Frasier established the Oak Tree Inn in 1997 as a family business. It is
Balmaha's most well-liked tourist destination. The eight children of Sandy and Lucy, as well as
their extended family, all contribute to the success of the oak tree. The Oak Tree Inn is a multi-
use building that functions as a bar, restaurant, cafe, and general shop in Balmaha, Loch
Lomond. Scotland's best pub, The Oak Tree Inn, has won numerous awards for its warm and
inviting ambience. From coffee roasting to ice cream production, they do it all onsite
(Christodoulou, 2019).
This family-run business has come a long way from its beginnings as a small electrical
contracting business to its present status as the creator and builder of a brand-new tourist
attraction. Between its accommodation, village store, cafe, and brand-new food and coffee
drive-through, The Oak Tree employs more than 100 people. The Oak Tree Inn offers 36 guest
rooms. Six cottages and two vacation pods with kitchens and toilets make up The Frasier’s eight
homes. Although the entire cottage can be rented, customers often rent the houses by room.
These cottages, which are close to the restaurants at the Oak Tree Inn, each feature at least six
beds.

External analysis:
PESTEL Analysis:
The PESTLE analysis process is essential to evaluate a company's external environment and
make strategic decisions that will provide a competitive advantage. Research into social, legal,
political, economic, technological, and environmental issues may improve a company's capacity
to adapt to market risks (Sung, 2019).

Political:
Since they understand that tourism might be profitable, Scottish officials give it much
consideration. The tourist sector was able to boost output and longevity through coordinating
efforts with stakeholders and tourism organizations. The area is more politically stable.
Therefore Oak Tree Inn can offer its visitors more outdoor activities (Barney, 2020).

Economic:
Due to the recession and the hundreds of people who have lost their employment due to
COVID-19, fewer people are spending money on vacations and other types of amusement.
Although the number of guests staying at Oak Tree Inn is rising, the hotel needs help filling
open positions because there is a shortage of affordable housing, and young people are moving
out to attend college (Christodoulou, 2019).
Social:
In general, tourists look for inexpensive resorts that yet offer the necessities. The tourist sector
is essential to the nation's economic development and social advancement. Customers can
anticipate the best ice cream and coffee in town at Oak Tree Inn.

Technological:
Resorts advertise online through various social media and travel booking websites. Companies
with an internet presence can draw in more customers because doing business with them is
easy and comfortable. The Oak Tree Inn website is attractive to look at and is filled with
valuable details about the company and the services it offers. We may purchase coffee, ice
cream, and merchandise bearing their emblem on their website. Digital marketing can be
launched without requiring a significant initial financial outlay thanks to mobile applications,
websites, and other internet technologies (Barney, 2020).

Legal:
The Scottish government's proposal for a tourism tax could increase tourist accommodation
rates. As with any other upscale hotel, visitors will spend more for an overnight stay at the Oak
Tree Inn (Christodoulou, 2019).

Environmental:
Concerns about climate change's repercussions are felt by people everywhere. There is a lot of
pressure on the government to take action to protect the environment. Participating in
community development initiatives that increase awareness, such as the distribution of
pamphlets and the creation of educational banners, could enhance the Oak Tree Inn's
reputation with the general public. Additionally, people can take preventative measures to
lessen the disease's effects (Vasileva, 2018).
Figure1: Pestle analysis

Porter’s five forces model:

Analyzing how these five factors interact helps a company understand the risks that could hurt
its bottom line (Vasileva, 2018).

Bargaining power of supplier:

Because they concentrate on providing locally made ice cream and coffee, Oak Tree Inn uses
less energy than other hotels. In addition, family members manage the majority of the day-to-
day activities because it is a family business.

The Threat of new entrants:

The organization must contend with hugely competitive competition from aspiring business
owners as the travel industry grows and new trends take hold. The company is also having
trouble gaining a competitive edge due to a lack of trained workers, a high turnover rate, and an
ineffective organizational structure (Mack, 2019).

Threats of substitute:
Oak Tree Inn faces much competition from less expensive competitors. Websites like Trip
Advisor and Hotel Trivago are just a couple of examples of those that use filters to help users
choose hotels that best suit their needs and price range. Additionally, with a large and diverse
customer base, Airbnb is a business that is expanding quickly (Vasileva, 2018).

Bargaining power of buyers:

With the ability to compare costs and find lodging that fits their budget, customers now have
more power over which firms they choose.

Rivalry among competitors:

The Birchwood Guest Lodge, Loch Lomond Waterfront Luxury Lodges, and other options are
available to guests as hotel substitutes.

Figure2: Porter’s model

Internal Analysis:
VRIO Analysis:
The VRIO framework allows organizations to review their current capabilities and assets to
determine whether they can be used to create a long-lasting competitive advantage. The four
components of VRIO are value, rarity, imitability, and organization (Sung, 2019).

Resources Value Rare ImitationOrganizatio Competitive

n advantage
Brand Yes It is No In various A Long-Term
Awareness unquestionably segments, it Competitive
a top-tier has utilized Advantage,
brand. its brand Creating and
position Maintaining It
Products Yes, given There are a lot Rivals might The success Give a
and services the wide of rivalries, imitate it. of the transient
range of much of which corporation commercial
market are aiming to with it is seen edge, but
segments take over in Exhibit maintaining it
and lucrative Case. demands
consumer markets. ongoing
preferences. innovation.
Structure of Yes No Yes No Equal
the opportunity
organization to compete
Stakeholder Yes Yes Yes Yes Competitive
s advantage
will be
sustained

SWOT Analysis:
Strengths:
The services that Oak Tree Inn can offer are very diverse. Because of this, Oak Tree Inn can
capture more of the market share for the entire sector. In order to grow, Oak Tree Inn is
concentrating on providing services for the food and beverage (F&D) sector. The indicator
demonstrates the company's capacity to guarantee profitable growth. Excellent opportunity to
address the expectations of each client by concentrating on developing expertise in addressing
their unique needs (Victoria Ivashina, 2018).

Weakness:
A family runs the inn. Because of this, there needs to be a central committee or board of
directors. As a result, operations could adopt unprofessional viewpoints or reduce their quality
standards. The satisfaction and enjoyment of the company's customers come first. However,
there are problems in implementing a straightforward system at Oak Tree Inn that guarantees
every employee's happiness and well-being (Vasileva, 2018).
Opportunities:
In other parts of Scotland, there are expansion possibilities. Support from the government to
help the tourism sector expand its market by integrating different businesses’ growth
management with technology. As the world begins to recover from COVID-19, there is likely a
clear correlation between the increased foot traffic at Oak Tree Inn and the rising need for
hospitality services.

Threats:
Its disorganization has been determined to be Oak Tree's main flaw. Shareholders and
investors may get disinterested as a result. Events like Covid-19 and Brexit hurt tourism, which
decreased demand for the services offered by Oak Tree Inn (Armstrong, 2017).

Strategic choices:
Two strategic options can be established based on the information from the SWOT analysis to
help lessen Oak Tree Inn's risks and weaknesses and boost the business's long-term
profitability.

Company’s merger:
The abundance of cottages and holiday pods indicates that Oak Tree Inn is a reputable brand in
its industry. They are already well-known in Scotland and have won numerous prizes attesting
to their brilliance, so they can merge with other well-established businesses to reach new
markets. They might acquire a competitive edge by utilizing the growth strategy, which is
currently one of the trends in strategic management. In addition to earning the admiration of
their industry peers, Sandy and Lucy Frasier will be able to leverage the creative thinking of the
board members at their newly merged corporation to advance their company. With this
knowledge, the Frasiers will be better equipped to develop a plan to handle the organization's
problems and reach its expansion objectives. Examples include enhancing goods and services
and growing the business's market share (Vasileva, 2018).

Expansion scope:
The Scottish government places a high value on tourism, given that it invests 45 million pounds
annually in the industry and pays the relevant organization to visit Scotland. Their main
objective is to boost tourism to Scotland by giving it a more robust international voice. Oak Tree
will be able to attract new customers from all around Scotland. Travel has become a significant
part of many people's lives, and social media platforms make it possible for customers to view
the splendor of the world and attractions from all over the world while also providing customers
with a wide range of offers and price bargains. These factors all contribute to the high demand
for tourism and tourist businesses (Armstrong, 2017).
SFA Matrix:

Figure3: SFA Matrix

When designing their plan, businesses must consider the applicability, accessibility, and
feasibility of the possibilities. This strategy thoroughly evaluates all viable options before
reaching a final decision (Mack, 2019).

Company’s merger Expansion scope

Sustainability The suggested idea is based The remainder of Scotland is
on mergers of businesses. currently implementing the
One of Oak Tree Inn's main suggested plan. It will help
concerns will be more Oak Tree Inn expand into
effectively managing its new coffee and ice cream
enormous customer base sectors, boosting its market
with a merger or takeover. share and earnings. Positive
customer reviews and social
media sharing are additional
methods for enhancing a
business's reputation.
Feasibility Oak Tree Inn has sufficient Adequate resources are
net earnings to pay for its required for this method.
mergers. The Scottish Stakeholders, administrators,
government actively and local council members
promotes the travel and are examples of potential
tourism sector and is sources. The significant
prepared to offer more help if profits earned will be used to
needed. support the company's
growth.
Accessibility Stakeholders will receive the More expenses will be
proposed approach well generated by opening
since it is successful and different franchises.
responsible for achieving Oak
 Tree Inn's objectives of
boosting customer
satisfaction, market share,
and income.

Recommendations:
There has long been a correlation between an organization's knowledge level and its offerings'
caliber. This component is integral to the environment in which the Oak Tree Inn functions. As a
result, Option 2, which emphasises training and development for present personnel, is advised
by the study. The plan gets its inspiration from tried-and-true business tactics by examining the
achievements of competitors. The success of training and development programs is highly
valued by Oak Tree Inn stakeholders because it has a favorable impact on crucial KPIs like the
potential for business returns and low-risk requirements. The capacity of the strategy to set
performance standards for employees will have long-term effects on the organisation.
Compared to Option 1, Option 2 is more likely to encourage stakeholder satisfaction, business
growth, and service quality. The board of the Oak Tree Inn must therefore make the choice. It
will make sure there is always enough accommodation to handle the sudden increase in tourists
that come to certain places. This vastly improves Oak Tree Inn's chances of penetrating a
sizable market.
References
Armstrong, K. &., 2017. "Principles of Marketing Management Management",. Pearson Publications.,
2(4), pp. 22-334.

Barney, J. B., 2020. "Looking Inside for Competitive Advantage".. Academy of Management Executive,
4(9), pp. 49-61.

Christodoulou, A. C. K., 2019. “Identifying the Main Opportunities and Challenges from the
Implementation of a Port Energy Management System: A SWOT/PESTLE Analysis.” Sustainability. 11(21),
pp. 1-15..

Ibrahim, A. a. D. C., 2019. Impact of leadership on organisational performance.. International Journal of

Business, Management and Social Research, , 6(2), pp. 367-374..

Mack, J. P. J., 2019. The Influence of Contextual Factors on the Entrepreneurial Process, Umeå School of
Business and Economics, Master Thesis.. 2(4), pp. 22-144.

Sung, S. a. C. J., 2019. Effects of training and development on employee outcomes and firm innovative
performance: Moderating roles of voluntary participation and evaluation.. Human resource
management, , 57(6), pp. 1339-1353..

Vasileva, E., 2018. “Application of the Pest Analysis for Strategic Planning of Regional Development.”.
49th International Scientific Conference Quantitative and Qualitative Analysis in Economics, Economic
Faculty in Nis,, 2(1), pp. 223-229..

Victoria Ivashina, M. H., 2018. "Oaktree: Pierre Foods Investment. Harvard Business Review Case Study.,
2(1), pp. 22-122.

Williamson, O. E., 2019. Markets and Hierarchies(1975). New York: Free Press, , pp. 222-225.

Yuksel, I., 2017. “Developing a Multi-Criteria Decision Making Model for PESTEL Analysis.”. International
Journal of Business and Management , 7(24), pp. 52-66..