Overview of Intercontinental Hotels Group PLC
Intercontinental Hotels Group (IHG) Plc is one of the leading companies all over the world. It has over 375000 employees which are operating in about 100 nations in order to deliver True Hospitality for each and every person. The company runs over 5000 hotels with more than 750 rooms in 100 nations across the world. Further, IHG functions in three manners primarily like a leased, an executive and lastly as an owned as well as franchiser based in four areas. The four areas are Europe, America, Asia, Middle East and Africa (AMEA) as well as Greater China. Present report emphasizes on the discussion relating to impact of current accounting and finance trends on IHG. Further, the manner in which strategies are developed in the company in order to resolve the issues relating to current trend have also been discussed in appropriate manner.
The headquarters of company and its offices of Australia are in Georgiain Greater Atlanta and Dunwoody. Europe Offices are situated in Buckinghamshire, Denham in England. Further, AMEA offices are located in Singapore and the offices of Greater China are in Pudong. In the year 2017 the company has earned the revenue of $1.8 billion. Moreover, the major competitors of Intercontinental Hotels Group Plc are Wyndham worldwide, Belmond, Marriott and Hyatt Hotels. Main strategy of IHG is to deliver superior quality development which implies constant, persistent growth in cash flows as well as revenues for long period of time.
To cope up or to align with least trends of the industry, company has developed strategic model which assists in order to concentrate on value-creation through preferred brands, delivering a high owner proposal, leveraging scale and producing profits by reduced-cost, direct channels. Along with this, the company focus on targeted portfolio that, simultaneously with disciplined implementation of their strategy and a devotion to run the business sensibly will make high shareholder returns. With the help of this model the company will be able to survive in the market competitively despite of current trends.
The decisions of company are taken on the basis of strong governance which encourages a culture of responsible attitudes and behaviours so that it can operate efficiently as per changing trends of accounts and finance. Risk management framework is developed by the management which analyzes the upcoming risk and make people aware relating to same. Further, they ensure that workers have the knowledge of official and reputational concerns and its winning ways. The company make sure the safety and security of workers, visitors and other guests to their hotels and offices. They control effectual risk management and internal controls. Along with this, the Intercontinental Hotels Group is affianced in conscientious procurement.
In order to evade the impact of current trends in accounting and finance the risk management framework has been developed by the company. It is completely incorporated with the manner it exercises the business by their culture, procedure and controls, reporting which is imitated in the strategy. Moreover, the Global Risk Management function is liable for the support, growth and supervising the efficiency of this system. It emphasizes on four main variants which are: culture, procedures, controls, reporting and administrating.
Strategies Framework: Strategic Model
With the increase pace of internationalization and globalization, hotel industry is becoming more and more competitive in relation to productivity, survival and growth. The internationalisation of hotel industry has hasten under the pressures of vibrant matters for example progress in communication and transportation, technology, deregulation, eradication of political obstacles, alterations in sociocultural as well as in global economic development. Further, the main challenge to hotel industry is selection of appropriate financing option in order to expose as well as expand on international level. Further, application of IFRS is also significant issue as it is not easy for accountant as well auditors for providing assistance relating to same as it required major changes in existing accounting system.
One of the main problems which managers of hotel business facing deficiency of capital. The solution for the deficiency of capital is restraining investment to a level which could be promoted by obtainable funds. In order to deal with the problem the price can be increase to balance demand and supply for financial resources. Rise in price will enhance the cash inflows and hence not restrain the acquirement of other resources in short period of time. Hotel industry uses various techniques of creative financing for diverse time periods. Some investment approaches and methods are there which are to be implemented by developers, operational organisations brokers and lenders who contribute in hotel development to deal with modified economic circumstances.
Latest trends in account and financing which can exemplify and shape the industry are constant high volume of sales dealings since the bargain of buyers can flip properties and make revenues, sturdy re-entrance in market by traditional lenders involving domestic and international pension funds, insurance firms and commercial banks. Subsequently increase in direct participation of intercontinental and domestic hotel firms and attempts are being made to expose on international level.
The risk in culture includes the tone, ethical values, attitudes and regulations of company along with governance and group structures. Further, there are three lines of defence of IHGC; which includes regular activities which recognises and administers risks. The second is functional specialists for example Business Reputation and Responsibility panel and sovereign assurance along with strategic risk planning. Further, the last defence operation is supervising and reporting comprises administration of risk and performance.
Conclusion
Above study concludes that Intercontinental Hotels Group is operating efficiently in competitive environment and is hastening the development of business along with maximisation of returns on new inventive. Further, appropriate implementation of risk management framework has supported the company in coping up with challenges relating to changing trends of accounting and finance. The growth and success of IHGC which comprises development of new brand, avid hotels which is established in year 2017, contains 75 out of which 44 hotels were signed on 31 December 2017 is proof of appropriate implementation of strategies in the company.
Reference
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