SWOT analysis is one of the most effective tools for critically assessing a range of internal and external factors in order to assist the decision-making (Callen, 2009). SWOT abbreviation stands for strengths, weaknesses, opportunities, and threats associated with a business.
First of all, Guest-Tek as a brand possesses a set of advantages that have been used as sources of competitive advantage by the company and thus leadership position has been obtained by the company in Northern American market. These business advantages include the high profit margin of 35-45% generated by the business, increasingly high customer retention rate of 99% due to effective value offer appreciated by customers, attractive prices of the services of the business, as well as, preferred vendor status of Guest-Tek with well-known hotels such as Hilton, Hyatt, and Marriott. Moreover, the fact that the company employs young, energetic and entrepreneurial leaders can be highlighted as additional strengths of the brand.
Furthermore, there are competitive points associated with GlobalSuite offer of the company that also can be considered as Guest-Tek strengths that maximise the chances of its success in the Russian marketplace. These points include the possibility of contacting support desk and communicate in a wide rage of languages, no need to change the laptop settings in order to connect to the internet, and the fact that network equipment is obtained from high-call technology manufacturers.
Moreover conveniences provided to hotel managers to set the price of the internet or offer free-of-charge services, as well as, short payback period of the GlobalSuite installation further contribute to the attractiveness of this specific offer in Russian marketplace.
A set of weaknesses are associated with Guest-Tek business strategy in general, and its GlobalSuite installation offer that need to be eliminated in order to succeed in Russian marketplace. First of all, there is a lack of international experience within company management and this fact presents substantial challenges for the management to operate in Russian market that is fundamentally different from Northern American marketplace in many aspects of the business.
Furthermore, the current Guest-Tek business practice of taking long period of time of up to 12 months from generating interest in perspective customers to signing contracts can be considered another weak point associated with the business. These weaknesses need to be addressed in an effective manner in order to maximise Gust-Tek success chances in Russian marketplace.
There are a set of attractive opportunities in Russian marketplace Guest-Tek management might consider to explore in order to achieve long-term success. Primarily, this opportunity includes moving beyond servicing only hotels with broadband connections and offering GlobalSuite installation to a range of other catering businesses such as fast-food restaurants and cafés.
Moreover, Guest-Tek management might consider pursuing the opportunities of forming strategic alliances with local technology service businesses. As Sinkovics and Ghauri (2009) inform, forming strategic alliances with local businesses in foreign markets offer the advantages of shared risks and access to knowledge about the specifications of the local marketplace.
Specific businesses threats are present for Guest-Tek in Russian marketplace that need to be addressed by the management. Differences in terms of hotel structure between hotels in Northern America and Russia are likely to result in negative operational implications. Moreover, there are vast cultural differences between North American and Russian consumers and cross-cultural differences if not addressed timely and properly can in misunderstandings in many levels, thus decreasing the level of competitiveness of the business (Thomas, 2008).
- Callen, B, 2009, Managers Guide to Marketing, Advertising and Publicity, McGraw-Hill Professional
- Sinkovics, RR & Ghauri, PN, 2009, New Challenges to International Marketing, Emerald Group Publishing
- Thomas, DC, 2008, Cross-Cultural Management: Essential Concepts, 2nd edition, SAGE Publications