Asset Light Strategies Are the Only Way Ahead for International Hospitality Companies

In general, the outsourcing is hiring the foreign workers/company to do a particular task, as opposed to hiring domestic workers/company. Besides the outsourcing, the international purchase is an essential activity of companies. In the trend of a booming global economy, a company only focuses on its core value and hire suppliers to supply the necessary product and service. The relationship between companies are complicated and interdependent.

The dawn of the outsourcing era. Many large U.S. corporations cultivates outsourcing faster than we can imagine. The trend that began in the late 1970 and picked up speed in the 1900s with the opening trade with China, India, and Eastern Europe (“Outsourcing: What’s the true Impact”). In its broadest sense, outsourcing is simply contracting out functions that had been done in-house—a longtime U.S. practice (“Globalization: Threat or Opportunity”). Subsequently, outsourcing is an essential part of globalization; and it is the combination of markets through the cooperation of internalization, federal, and state governments with corporate companies to produce products on a reduce production cost, and offer services on lower labor cost. When a U.S. manufacture product, and buys material from an intermediate supplier from out of the country rather than producing them in-house, that is what is called outsourcing. Also, when U.S. corporation hires outside contractor out-of-the-country to do U.S. call center services for less labor cost that is outsourcing. When a company deals out its operational task, such as payroll, accounting, and software operations that is outsourcing. Obviously, all of these examples seem to benefit and in favor of the corporations. To get the clear understanding of outsourcing for major corporation perspective, I have interviewed IKEA’s U.S. Deputy Retail Country Manager Rob Olson about outsourcing—Swedish

Outsourcing is a method used by many corporations in which their products are manufactured in foreign countries often for cheaper labor.This method method of productions has it’s pros and cons.

Outsourcing is the process of “hiring foreign workers to do a particular task, as opposed to hiring indigenous workers” (fee.org). Although it may seem like a favorable business approach, it only provides a gain out to large corporations. Since outsourcing is assembled around extensive cooperation’s, it steals from the “mom&pap” stores.

As we discussed in class, every business is faced with these issues and they are important to managers making strategic decisions. One of the first things learned about business is that if there is no demand for a good or service, the firm that provides it will not continue to exist. Over time the hotel industry has continued to change with market conditions and make itself attractive to business

Outsourcing is a technique that allows a company to subcontract part of the business functions. In general, there are three different types of outsourcing: (Feenstra & Jansen 2010)

Outsourcing is a business strategy that has been around since the eighties and has grown in popularity year after year since. There should be advantages to outsourcing for this trend to occur. There are however certain types of companies that would disagree with this method. Outsourcing has become one of the most controversial issues in business today. This report will explore different approaches on this matter to try and understand whether outsourcing is always the best option or not. It will study the advantages and disadvantages of outsourcing and insourcing, why some companies prefer one as opposed to the other and finally the factors that affect their decision, such as environment and cost.

There are five main fundamental issues that both owners and operators look for when beginning the contract negotiation process. According to, “Hotel Management Contracts- Past and Present” the five fundamentals are:

Accor, the world’s leading hotel operator, offers its guests and partners the dual expertise of a hotel operator and brand franchisor (Hotel Services) and a hotel owner and investor (Hotel Invest) with the objective of ensuring lasting growth and harmonious development for the benefit of the greater number. "Accor’s global

Whether one is running a small business or an established company, outsourcing is one of the paramount ways of attaining professional services at a fraction of the price of hiring a department or a person on a full-term basis. Furthermore, as the business grows, there is no denying that outsourcing becomes a more realistic solution, whether it is a human resource, information technology, or even accounting. Additionally, outsourcing has become popular since it permits business organizations to remain focused on its key competencies while allowing experts to handle theirs. Whatever reason one may have the use for outsourcing, it is almost obvious that one stands to gain in the long run due to the attainment of services at a fraction of the cost (Maon, et al 2010).

Outsourcing has become increasingly commonplace in businesses today. Outsourcing is defined by “the strategic use of outside resources to perform activities traditionally handled by internal staff and resources” Outsourcing is a relatively new operations management tool that began to be used around the time of the Industrial Revolution. This arose out of major technological advances in transportation in the form of the railway and canals and in communication in the form of the telegraph which allowed organisations to expand beyond their . According to Joanne Yates ‘the spread of the telegraph and of railroads encouraged firms to serve larger regional and national markets.’ This evidenced by a rise in small engineering and architecture consultants. It wasn’t until the 1970’s that outsourcing began to become more popular. The 1970’s marked the rise of computer technologies where companies began to research into home computer systems. Also in the late 1970’s communist China opened its doors to global trade. In manufacturing, the largest cost is labour therefore offshoring manufacturing to developing nations such as China where the cost of labour is

Information and communication technologies are of paramount importance in the process of international outsourcing primarily through the technological advancement surge and demand in recent years. Through the rise of Information technology in recent years, the importance of international outsourcing rose significantly. Outsourcing is the contracting of the management and/or execution of a business function to an outside third-party contractor or subcontractor. Outsourcing typically refers to the contracting of services to an offshore, rather than domestic, company. While outsourcing has been an accepted business practice for

* Build relationships with investors, secure hotel management contracts and successfully manage the hotel investments, underpinning asset values.

Trends in the marketplace can help determine areas a firm can explore to be successful. Use of carefully considered outsourcing can be a critical component of corporate strategy for any multinational corporation. With outsourcing opportunities in front of them, these corporations should first work to understand the demographics and capabilities of the workforce before making any moves. Companies shouldn 't simply resort to outsourcing and assume it would automatically translate to lower costs. It is important to study labor supply and demand, in order to

Management contracts are written agreements between a non-industrial property owner (CPG Group) and an external company with industry expertise (CPG Hotels) for professional management with “operating standards and good practice” (p. 180) of a hotel, for instance. CPG Hotels (2015) state on their website a couple of examples for standards and practices they implemented after they took over the management in May 2015, such as rebranding including an extensive refurbishment and installation of free Wifi in all properties. In addition, a property management system was installed to