Hilton Hotel Corporation Case Study Example | Topics and Well Written Essays - 2250 words

Hilton Hotel Corporation - Case Study Example (Maxwell et al, 2004: p. 168). Hilton International is spread over four global regions including: UK and Ireland; Africa and the Middle East, Europe, Asia Pacific; and the Americas. According to Maxwell and Lyle (2002: p. 251), the strategic objectives central to the business plan include: The above objectives are drilled down to tactical actions on delivery, which in turn demand good people practices in recruitment and assessment, reward and remuneration, career tracking, and discipline and competencies in the Human Resource function. (Maxwell and Lyle, 2002: p. 251). The main objective for the existence of any business like the Hilton Group is to generate superior shareholder value. It was at first believed that the business should do everything possible to satisfy the shareholders and no body else since shareholders are the ones who take maximum business and financial risk by contributing capital to the business. While we agree with this central idea, it must also be noted that the success of every business is dependent on how the business satisfies its customers. The satisfaction of the customer and the shareholder appears to be in conflict but it turns out that shareholder value can only be created if customers are satisfied. Satisfying customers means providing them with the right goods and services at the right prices at the right time and at the right place. Therefore to satisfy the shareholders, the business must begin by satisfying customers. Put in other words, shareholder value can only be created through the creation of customer value . Stemming from a decreasing number of customers, and considering the current competitive marketplace, hotel companies now find it necessary to win the loyalty of the limited number of customers. (Gilbert et al, 1999: p. 25). Following from this we would try to examine how Hilton Hotel International attempts to increase its market share in the existing market given that the customers are limited in number and that their demands are continually changing. The Hilton Hotel has its major focus on the customer. The major assumptions that one can make for the current five years are as follows: that the business wishes to maintain constant growth by 5% annually as measured by Return on equity, Return on Assets, Return on Capital employed, growth in dividends and other important financial ratios. The business also wishes to attract and retain more customers as measured by its market share in the in hotel industry. It also wishes to maintain the most profitable customers providing them with the highest possible value for their money. Another important assumption is that the business wants to maintain a very good relationship with shareholders and other lenders so as to ensure that its cost of borrowing funds (cost of capital) remains at the lowest possible level. This will enable it reduce its business and financial risk as measured by the debt-to-equity ratio, the current ratio and quick ratios as well as the creditor's payment period and retain earnings. Based