Based on the above, identify the major strategic issues that the organization is

likely to face going into the future. How would this affect the organizations
competitive advantage?

The success of strategic objectives is a task that is found to be challenging for

any organization and can be linked to the presence of changes that occur in its
residing environment. These strategic objectives can be complicated even
further when a business decides to expand globally and is confronted with the
instabilities emerging in remote markets. (McGuire, 2015) Some of the major
strategic issues that Jumeirah Group may face are as follows:

Cultural Issues: To execute its global expansion strategies, Jumeirah Group aims
to globalize its brand image by starting 70 new projects internationally (Walid,
2009) With such an aggressive expansion, Jumeirah Group will expect differences
in skills, knowledge and cultural diversity. As a hospitality firm, Jumeirah Group
needs to find a blend of cultural cohesiveness between amenities catering to the
needs of different cultural bounds of the country they expand in. This can be
seen in Asian cultures, having direct eye contact is found to be uncomfortable to
guests. (Jin-zhao and Jing, 2009)

Labour: Shortages of labour are found to be one of the most challenging issues
faced by hotels in every geographic location. According to INSHC expansion of
hotels in not held back by capital but by the lack of qualified labour resources.
Jumeirah group needs to employ an innovative strategy to retain and capture a
competent human resource if it to maintain their competitive advantage of
superior hospitality service. Furthermore another operating issue that will arise is
the miscommunication between regional and general managers; therefore a
global management system is needed. (Jin-zhao and Jing, 2009)

Brand Image: Market segmentation will be on the rise and Jumeirah Groups
focus on a particular niche of customers may lead to a brand overlap. As the
Jumeirah Group increases its brand image, the ability of customers to
differentiate between the brands becomes difficult. (Jin-zhao and Jing, 2009)

Technology: The hospitality sector is currently moving towards internet based

systems, this enables an easier integration of operational data but many hotels
have failed to adopt this new technology which allows them to streamline their
daily operations. (Jin-zhao and Jing, 2009) The increase of Jumeirah group Hotels
international growth in different parts of the world proved a successful entry to
new territories, while a rapid growth research shows that technology is fast
paced and keeping up with it can prove to be expensive and difficult. Jumeirah
Groups currently owned technology strategy is rigid and this may lead to a
standstill of daily functional systems such as room reservations. (Best Practice,
2011) If continued their current IT infrastructure will lead them to brand
tarnishing.

Competition: Hotels can be found almost everywhere; their existence is

abundant and with extra rooms available relative to their demand can give rise
to an intense competition between rivals in local and regional/international based
locations. The ratio of a shrinking market demand in the future can lead
hospitality firms to reduce their overall rent prices by 30% (Jin-zhao and Jing,
2009) Likewise Jumeirah Group might lose their competitive advantage if there is
a cost cut in their product and service quality furthermore emerging competition
can reduce Jumeirah Groups market share potential. Another factor to consider
with relation to Jumeirahs competitive advantage is the ability to target the right
customers, having assessed the needs and wants of customers can Jumeirah
Group then target and promote to the right base of travellers. This can in turn
lead to a heavy reliance on customers to drive their profits and revenues and as
a result decrease their competitive advantage. (Jumeirah Group, 2013)
References

Best Practice. (2011). 1st ed. [ebook] Dubai: Arabian Computer News. Available
at: http://www.ehdf.com/images/Casestudy/pdf/Jumeirah%20Group.pdf [Accessed
13 Dec. 2016].

Jin-zhao, W. and Jing, W. (2016). Issues, Challenges, and Trends, that Facing
Hospitality Industry. Management Science and Engineering, 3(4), pp.54 - 57.

Jumeirah Group, (2013). Sustainability Report. [online] Dubai: Jumeirah Group,

p.43. Available at: http://www.jumeirah.com/globalassets/global/jumeirah-
group/corporate-responsibility/csr-report/jg_sustainabilityreport2014_final.pdf
[Accessed 13 Dec. 2016].

McGuire, K. (2015). Hospitality Net - Top 10 Global Trends that will Impact
Hospitality in 2015 | By Kelly McGuire. [online] Hospitality Net. Available at:
http://www.hospitalitynet.org/news/4068829.html [Accessed 13 Dec. 2016].

Walid, T. (2009). Jumeirah Group committed to expansion. [online] Arabian

Business. Available at: http://www.arabianbusiness.com/jumeirah-group-
committed-expansion-13969.html [Accessed 13 Dec. 2016].