Globalization of the Hospitality Industry

Globalization of the Hospitality Industry

The phenomenon of globalization has affected every single person in the world, in one-way or another. The opening of markets, of political forums, of social networks, whether through technology or otherwise have all been results of increasing globalization. In fact, the world today seems a smaller place because of this phenomenon. It is not unusual to speak to somebody from across the world at any given time of the day today, whereas in the past it was to be unfathomed. Globalization has its perks, but it may not always be positive in its consequences. This paper will examine one aspect of globalization; namely the effect the process has had upon the hospitality industry. The paper will also analyze articles that expand upon this topic, and will seek to answer the question as to what challenges this industry has faced in expanding beyond domestic markets and how it can overcome these challenges in order to ensure survival and future success.

To begin, one must understand exactly what is meant by globalization, especially in this context. To do so, one can follow the definition below:

"Globalization is typified by the rapid movement of people, information and capital across national borders worldwide in ways that would have been difficult to envision not too many years ago" (Cline, 2012). Globalization is thus a force, as mentioned above, that eliminates borders and makes the world more porous in a metaphorical way. Globalization is aided by technology, and this is a very important aspect that the hospitality industry must take into account.

The hospitality industry is surely something that could benefit from globalization. More people means more money, and rapid movement of peoples, a result of globalization, means more money more quickly. According to Cline (2012), tourism, the poster child of the hospitality industry, "has become the world1s largest export industry, involving as it does enormous cross-border flows of people and capita…" the tourism industry, in fact, employs the largest numbers of people worldwide, no matter what culture one looks in, and this is a result of globalization. This facet is also a positive aspect, for in this case the hospitality industry can offer jobs to those who need them.

Yet in many countries, the ability to stay competitive in the face of globalization is impossible to achieve. Cline (2012) further states, "…those hospitality companies that believe that they can grow and retain a niche position without acknowledging the imperatives of globalization need to take another look. Put another way, most hospitality businesses will need to think "globally" if they are to survive." According to this author, globalization will touch all, no matter where, sooner or later, and only by staying competitive, and embracing globalization, can tourist services survive. As aforementioned, however, in poorer income countries it is impossible to do so, often because of the inaccessibility of technology. Without technology, such an industry cannot stay competitive, and this is one of the many negative aspects of the globalization of the hospitality industry.

Even in richer countries, however, such as the United States, a company does not necessarily and successfully globalize simply because it has the capital. Often, an expanded market means that a company will need to undertake a strong marketing strategy based upon thorough research in order to see how the expansion would affect another market. The problem is, not all companies wish to do so because not all are good or successful at this undertaking. Yet again, if a company wishes to stay competitive, make its profits year after year, and enjoy a general lengthy business life, it will have to embrace the risks and rewards of globalizing its enterprises.

Hotels, the stalwarts of globalizing tourism, will be among them first affected by increasing competition. Hotel staff, unlike in the past, must thus undertake learning various concepts through which it can face any circumstance. With expanding one's business, especially a hotel, comes an awareness towards the working habits of other countries. One must thus tailor rules and regulations to the people of that country. This, again, takes research and specialized staff, which can cost money. In the 21st century, hotel will have to learn the different management styles necessary for all kinds of culture, however, as they no longer have a choice to be ignorant. They must do so in order to understand all aspects of the environment in which a hotel operates, and the staff must be prepared for any eventuality.