Shangri-La Case Study
Shangri-La Hotels
Shangri-La Hotels and Resorts is a deluxe Asian hotel chain and was founded in 1971 in Singapore by the Malaysian-Chinese tycoon Robert Kuok. The name Shangri-La means “eternal youth, peace and tranquility” and embodied the serenity and service for which the hotel chain was renowned throughout the world. As of 2006, Shangri-La had four main business segments: hotel ownership and operations, property development including commercial buildings and serviced apartments, hotel management services to group-owned and third-party hotels and spas. The company has three major issues at hand: (1) the company was expanding into high-wage economies in Europe and North America; (2) the company was expanding its presence in China-a country where front-line employees were not used to exercising decision-making authority; and (3) newcomers in the Chinese hotel market were poaching Shangri-La’s staff and driving up wages in historically low wage markets.
1. What are the key elements of Shangri-La Hotel’s strategies for competing internationally? Which of the five generic competitive strategies is the company employing?
“Shangri-La built its brand on service excellence with a stated mission to “delight customers each and every time.”
Asian standards of hospitality and personalized guest service: Shangri-La Hotels uses a service model of “Shangri-La Hospitality” which was built around five core principles: respect, humility, courtesy, helpfulness, and sincerity. The company was built around these principles and used them to differentiate itself from the competition by providing distinctive Asian standards of hospitality and service. Within each country they adapted to the local requirements and provided individualistic services.
Employee Training: in 2004, the company opened its first training facility in China, the Shangri-La Academy. This was done in an effort to keep the company mission and core principles relevant throughout its hotel
Shangri-La Hotels and Resorts is a deluxe Asian hotel chain and was founded in 1971 in Singapore by the Malaysian-Chinese tycoon Robert Kuok. The name Shangri-La means “eternal youth, peace and tranquility” and embodied the serenity and service for which the hotel chain was renowned throughout the world. As of 2006, Shangri-La had four main business segments: hotel ownership and operations, property development including commercial buildings and serviced apartments, hotel management services to group-owned and third-party hotels and spas. The company has three major issues at hand: (1) the company was expanding into high-wage economies in Europe and North America; (2) the company was expanding its presence in China-a country where front-line employees were not used to exercising decision-making authority; and (3) newcomers in the Chinese hotel market were poaching Shangri-La’s staff and driving up wages in historically low wage markets.
1. What are the key elements of Shangri-La Hotel’s strategies for competing internationally? Which of the five generic competitive strategies is the company employing?
“Shangri-La built its brand on service excellence with a stated mission to “delight customers each and every time.”
Asian standards of hospitality and personalized guest service: Shangri-La Hotels uses a service model of “Shangri-La Hospitality” which was built around five core principles: respect, humility, courtesy, helpfulness, and sincerity. The company was built around these principles and used them to differentiate itself from the competition by providing distinctive Asian standards of hospitality and service. Within each country they adapted to the local requirements and provided individualistic services.
Employee Training: in 2004, the company opened its first training facility in China, the Shangri-La Academy. This was done in an effort to keep the company mission and core principles relevant throughout its hotel