Skip to main content

The Biggest Challenge and the Hidden Opportunity of Entering the Chinese Market

Starwood’s top executives are in Shanghai, China now. They will stay there for a month to get “localized” by the Chinese culture and “Chinese way” of doing business. In this MSNBC News video, Frits van Paasschen, the President and CEO of Starwood Hotels & Resorts Worldwide provided many good reasons of why Starwood needs to pay top attention to the Chinese market. I agree with him 100% and will not repeat what he said on the video. Instead, I would like to bring up one challenge and one hidden opportunity of entering the Chinese market.

I believe that the biggest challenge is to manage a company’s human capital in China, including recruitment and selection, training and development, and retention management. It is very difficult to recruit well-trained local managerial talents in China. Companies may assume that there must be abundant good candidates in a country with a population of 1.3 billion people. Yet, not every candidate has the proper education or training that a company desires; many college graduates are “book-smart” and needs extra training before they are ready to make sound business decisions on their own. Accordingly, companies need to plan a large budget for some very basic HR functions.

Another relevant area that needs special attention is employee retention. If Starwood is opening a new hotel every other week in China, other hotel companies, like Marriott, Hyatt, and Hilton, will not fall behind. Hotels are competing with one another to attract the top talents in a very small pool. If hotels do not want to see their well-trained managers working for their competitors, they had better take good care of their people and keep them aboard.

The huge hidden opportunity of entering the Chinese market lies in the advantage of gaining brand recognition among the Chinese consumers in China. Even though many developed countries still have very tight restrictions of issuing visa to Chinese travellers, I believe these countries, including the U.S., will open their tourist market to Chinese travellers soon. By then, if 1% Chinese will make their own travel arrangements to the U.S., those well-recognized hotel brands, as compared to the other local hotel chains, will probably have a better chance of attracting the 13,000,000 outbound Chinese travellers. Who does not want that business?

 
References:
The picture was downloaded from travelchinatour.com

Comments

Popular posts from this blog

Yammer: A Social Networking Site Exclusively for the Workplace

Effective internal communications among employees are related to some desirable organizational outcomes, such as robust morale, a clear vision, low turnover, and high employee engagement. The question is what platform can serve the purpose. This ABC News video introduces “ Yammer ,” an exclusive internal communication tool for companies. A user must use a valid company e-mail address to sign up for an account. Once an account is validated, the user will be led to the company page that is pretty much like a Facebook page. The difference is that only the users whose e-mail addresses share the same domain can see the wall and communicate with each other. I have no question about whether Yammer could be a useful internal communication tool for companies, but I just wonder: how many social networking sites do people need for communication? Why people have to “create” so many platforms or channels for “effective communications”? To many people, Facebook is only for “friends,” whe

Can leisure and work-from-home demand stimulate extended-stay hotel growth beyond COVID-19?

The lodging industry is   struggling   to fill the empty rooms in 2020. For months, U.S. hotels are running at an occupancy of 50% or lower.     Not every segment   suffers the same impact from the pandemic, however. Demand for   home-sharing  facilities had already bounced back over the summer. Airbnb reported a higher booking than last year. Marriott’s home-sharing arm is also doing well, seeing a sevenfold increase in booking over last summer.     Similar to what a residential rental or home-sharing facility   offers , guestrooms in extended-stay hotels also feature a full-size kitchen or a kitchenette. Extended-stay hotels are designed for travelers who want to stay at a “home” when away from home. A guestroom at the Residence Inn Miami Sunny Isles Beach   Extended-stay hotels vs. home-sharing facilities     Because COVID-19 is primarily transmitted through direct or indirect human contacts, people are highly encouraged to avoid unnecessary human interactions, leading to more   con

Will restaurants of the future still need a dining room?

It does not seem the coronavirus is leaving us soon, although we have seen good   progress in developing the vaccine . In recent weeks, many places reported   a surge of new infected COVID-19 cases . Some even resumed   lockdowns   and the mask-mandate order, forcing restaurants to   shut down indoor dining   services again.     As a short-term remedy, restaurants immediately shifted their offering to   curbside pickup and delivery  services. Meanwhile, restaurants are testing new concepts to embrace the   contactless self-service  trend for the future. Here are some examples,     Chipotle opened its first digital-only restaurant     The new prototype, known as the   Chipotle Digital Kitchen , debut in Highland Falls, NY, earlier this month. Different from the traditional Chipotle restaurant, the Chipotle Digital Kitchen features:     A lobby designated for pickup services through off-premise orders.   A see-through kitchen, allowing customers to see, smell, and hear what is going on b