Researchers point out that portfolio analyses evaluate an organization’s portfolio of business units by assessing the profitability and attractiveness of the industries the organization competes in as well as the competitive edge of an organization’s business units. Therefore, portfolio analyses offer important insights into the organization’s offerings. 😊
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Lifecycles capture the evolution of the tourism and hospitality
When portfolio analyses and lifecycles are combined, the findings can be very powerful because this approach looks at the positioning, the competitive advantages and the stages of products and services, thereby informing strategy development as well as effective management accordingly.
Firstly, differentiation may help determine profitability potential. When differentiation gives more competitive advantage, profitability potential becomes higher and buyer loyalty increases.
Secondly, focus also helps determine profitability potential. When the organization targets a specific market segment with the sole objective of marketing to that segment, the conversion rate is higher and the profitability potential is also higher.
Thirdly, positioning helps determine profitability potential as well. It makes the offering different and unique, thereby increasing the perceived value of the offering.
When these three strategies are not well done, the profitability potential can be lower.
Horizontal integration is the process of an organization increasing production of products and/or services at the same part of the supply chain.
In contrast, vertical integration is the arrangement where the supply chain of an organization is owned by that organization.
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How to identify the main internal activities which create and deliver customer value as well as relevant support activities:
Examples include using low-cost inputs and holding minimal assets, offering core products and services only and using lower-cost distribution channels.
The ‘build, borrow, or buy framework’ gives an effective model which helps strategies to decide whether to build a resource, borrow a resource or buy a resource. If internal development is possible, an organization may build a resource. If strategic alliance, contract or licensing is more convenient, an organization may borrow a resource. If acquisition is more practical, an organization may buy a resource.
Closeness is achieved through integrated alliances such as equity alliances and joint ventures, e.g., the borrowing of certain resources.
Tradability is when a firm creates a contract which allows for the transfer of ownership or use of certain resources, e.g., short-term contracts and long-term contracts.
Relevancy is when a firm wants to develop the same product or the same service.
Integration is acquisitions and merging.
“Because this project may need more time than what’s expected, effective project scheduling and effective project planning are obviously required in the tourism and hospitality industry. The project manager probably needs to merge some activities and shorten certain tasks in order to reduce the critical path.”
