The name Kempinski stands for luxury,
elegance, individuality and traditions. The company manages some of the
greatest luxury hotels in 31 countries in Europe, Asia, the Middle East &
Africa and The Americas. Kempinski runs, according to its official website
(n.d.), in total 76 five-star hotels.
The purpose of this paper is to analyse
and understand the management and the operation of Kempinski Hotels S.A. This
will involve an analysis of the structure, its stakeholders and environmental
factors and how Kempinski deals with these influences.
Based on information provided by Kempinski’s
official website (n.d.) was Kempinski founded in 1897 as the
“Hotelbetriebs-Aktiengesellschaft” in Berlin, Germany. Due to its history of
120 is the company, with the head office in Geneva, Switzerland, the oldest
European luxury hotel group. The company is involved in businesses related to
the hospitality industry which includes catering, conferences, hotel supplies,
spa services, restaurants, bars and lounges with dining options. Kempinski is
also involved in event organisations, such as weddings and meetings. The
“Hotelbetriebs-Aktiengesellschaft” purchased M. Kempinski & Co. in 1957 and
became Kempinski Hotels S.A. in 1977.
This report will start off with an
explanation of Kempinski’s legal form. This will be followed by the structure
of the company and its management levels. Afterwards, the terms vision and
mission will be explained and illustrated in case of Kempinski Hotels S.A. In the
next chapter will deal with Kempinski’s strategy, which will be followed by a
theoretical definition of a business process and a practical illustration in
case of Kempinski Hotels S.A. The following chapter explains the environmental
factors, which are divided into a stakeholder analysis and a PESTEL analysis. A
conclusion will round of this report.
A legal form describes the structure of
an organisation and can be recognized in the name of the company.
Kempinski Hotels S.A. is a stock
company. According to Investopedia (n.d.) stands S.A. for “Société Anonyme”.
Based on information provided by Gabler Wirtschaftslexikon (n.d.) is a stock
company is a company whose capital is divided into shares. This legal form is usually
used by larger companies, because an expensive founding process with a minimum
capital of 50.000€ is necessary, furthermore, a board, a supervisory board with
at least three people and a general meeting is essential for the founding of a
stock company. In order to found a stock company, at least one founder is required.
Despite the disadvantage of the expensive founding process are benefits the
easy transferability of the shares and the option to finance the company by
equity. Another advantage is the limited liability. This means that members can
only be called upon to pay the nominal value of the shares, which are held by
them. Examples for shareholders of Kempinski Hotels S.A. are the sheiks of
Bahrain, which are the biggest ones and Lufthansa.
In addition to that can be distinguished
between private and public companies. Kempinski Hotels S.A. is a privately-held
company; therefore, Kempinski Hotels S.A. is not obligated to publish its
Structure of the Organisation & Management
According to Marcus and van Dam (2015)
can an organisation be identified as a human collaboration with the same goal.
Since Kempinski Hotels S.A. is a global working company it is necessary to have
a specific amount of people and employees working for it. Kempinski employs
24.000 people worldwide.
Management task is to achieve the
companies’ goals, however this is only possible, if an effective organisational
process exists. The structure of the hierarchy within the company is dependent
on the size of the company. The tasks which occur in order to achieve the goal
will be divided within the different hierarchy levels.
The highest management level is called
the top management. This hierarchy level is responsible for creating and
dealing with strategic decisions. The management level under the top management
is called the middle management. This management deals with organisational
decisions and translated the strategic decisions into operational decisions.
The middle management has a directing function. The third level is called the operational
staff. It deals with the actual transformation part of the decisions.
Kempinski published its Management Board,
however no further information about each department, therefore is the management
board of Kempinski illustrated below.
Chief Executive Officer
Chief Financial Officer
Chief Operating Officer Europe
Chief Operating Officer Asia
Chief Operating Officer Middle East
Chief Operating Officer The Americas
Senior Vice President Business
Senior Vice President Development
Senior Vice President Human Resources
Mission and Vision
As stated by Marcus and van Dam (2015)
is a vision is a general idea and pictures the future of a company. The
importance of a vision for a company is analysed by the 7-S Model by McKinsey. This
model illustrates that the vision is the centre of a company and provides the
direction the company has to lead to, in order to fulfil its goals for the
future. The vision is surrounded by seven management tools, which are the structure,
the systems, the style, the staff, the skills and the strategy. These seven
management principles are connected and able to work together through the
direction, which the vision delivers.
The vision usually contains a mission
statement and principles. The mission statement of a company is an explanation
of their product-market combinations and shows how an organisation makes use of
its structural competitive advantage. The Principles relate to the norms and values
of a company.
Kempinski Hotels S.A. pursue a clear
vision which is stated below.
aim to be renowned as hoteliers who offer luxurious hospitality in the grand
European style.” (Kempinski’s Strategy, n.d.)
This vision provides a clear goal for
the company and is supported by the mission statement,
be the market leader amongst its location, without compromising its reputation
for operating unique, individual and profitable hotels in a distinctively
European flair.” (Kempinski’s Strategy, n.d.)
According to Neil Kokemuller (n.d.) is a
mission statement of a company an essential statement of the company’s purpose.
It works as a guide for all decisions which are made within the company. A
mission statement affects the shareholders, the leaders and manager and the employees.
These components (shareholders, leaders, manager) can be seen as a target of
the mission statement, because a clear statement can help employees to make
decisions which are best for the company regarding its mission.
The vision and the mission statement of
Kempinski Hotels S.A. provides a basis for every work which is done within the
hotels of Kempinski and therefore an important basis for every employee. Both,
vision and mission statement request and expect luxury standards in the hotels,
with the goal to be the leading hotel in each location, with a European
atmosphere individuality and uniqueness.
Marcus and van Dam (2015) can the word “strategy” be defined as a plan that
states what an organisation needs to do to reach its goals, therefore it is a chosen
method to bring about a desired future, such as achievement of a goal or
solution to problems.
goal, which the company Kempinski Hotels S.A. wants to achieve in the future is
stated in the vision and mission statement. The combination of following
strategies provides a clear plan, of how the company want to achieve its vision
in the future. All strategies are published on Kempinski’s official website.
Hotels S.A. has a strong focus on its employees, because, as stated on their
official website (n.d.) are the employees the people who make the hotels alive,
provide it with high service standards and deliver the luxury promise of the
brand Kempinski. Due to that, the company invests in training and education of
their staff in order to guarantee an expert knowledge and a strong company
wants to achieve its goal of being one of the most popular, desirable and
luxury hotel collection in the world with highly selective growth. Aim is, to
make every hotel special in its own way with the basis of the European
heritage. Therefore, Kempinski is mainly focussing on European destination,
however also expanding to China, Africa and the Middle East.
is concentrating on serving guests who expect high quality. Furthermore,
Kempinski wants to create sustainable value and put the attention on long-term
Kempinski Hotels S.A. is not a typically
hotel chain, but a collection of individual hotels. When selecting further
hotels, the company follows clear strategies, in order to fill its collection
with suitable houses and to achieve its vision.
focusses according to its official website (n.d.) only on exclusive luxury
five-star hotels in its key European and international markets. Only hotels are
selected which are financially sound and profitable for all involved parties.
Furthermore, Kempinski choses hotels which are strong enough to become market
leader in its own segment. In addition, does Kempinski strive for creating
niche products and focusses on the individuality of each hotel.
According to Markus and van Dam (2012)
can the goals of an organisation only be achieved when the business processes
are carried out in an efficient way. The definition of a business process,
based on Markus and van Dam (2012), is a number of activities, which are
organised and related to the making of a product or service.
Based on Markus and van Dam (2012) does
the business process describe the input, the transformation and the output of
on organisation. In case of Kempinski Hotels S.A. is the input of its hotels
defined as labour, which are people; natural resources, such as food, drinks,
buildings (selecting new hotels), electricity and water; and capital, such as
money and information about the competitors in Kempinski’s target market and
demographical data. The transformation of these inputs can be distinguished in
three different types of business processes, which are called primary,
secondary and administrative. Primary
processes are defined as the activities that have a direct relationship to the
making of the product/service. Examples in case of Kempinski are purchasing and
furnishing. Secondary processes are all activities that support the primary
processes. Kempinski’s secondary processes are for example the management of
personnel, finances and data systems. Administrative processes are defined as
all activities that help to reach the goals of the company and direct the two
other processes. The administrative processes have different tasks, such as the
selection of a strategy, planning, setting up a structure and the process
control. The transformed products or services will be sold to the customers. It
is important, that the output has a higher value than the input. In case of
Kempinski Hotels S.A. is the output defined as the hotels, jobs and the service
for customer, regarding food, drinks and spa.
There are several points which need to
be considered while managing and running a business process. First, there have
to be clear formulated goals, which the company wants to achieve. Furthermore,
the targets must be realistic, in a way, that the company is able to reach
them. The third point is, that a company should be able to have an impact on
the business process, for example receiving more output when adding more
resources. Additionally, is the planning, the measuring and comparing and the
adjustment an important part for the business process.
An organisation will always be
influenced by its stakeholders and its surrounding, such as external factors.
According to Page & Connel (2014) can a stakeholder be defined as a group,
for example businesses, residents and tourists, with an interest and concern in
a specific field. Therefore, can a stakeholder be identified as an internal
factor, which can affect the company.
Main stakeholders of Kempinski Hotels
S.A. are according to Marcus and van Dam (2012) customers, suppliers,
competitors, employees and the media. Their influences on the company will be
explained below, based on theory of Marcus and van Dam (2012).
Customers are one of the most important
stakeholder for Kempinski Hotels S.A., because a company has to offer what the
customers are demanding for. These demands can change; therefore, a company has
to be able to adapt to its customer needs. Kempinski Hotels S.A. address luxury
customers with a high demand on luxury and quality within the hotels and the
In its hotels, Kempinski offers various options
for dining, such as restaurants, bars and lounges. In order to provide these
services, the hotels have to work together with suppliers for food and
beverage. The hotels are dependent on the quality of suppliers, the price level
and the delivery time.
As stated by Marcus and van Dam (2012)
is it highly important to analyse the actions of competitors in order to keep
one’s own market share. According to Market Line (2017) are the main
competitors of Kempinski Hotels S.A. are DO & CO Restaurants & Catering
AG, Marriott International Inc and Ritz-Carlton Hotel Company L.L.C.
The employees of Kempinski Hotels S.A.
stand in direct contact with the costumers and represent the hotel to them.
Therefore are, according to Marcus and van Dam (2012) employees the most
important stakeholders for a company. Support and cooperation from the
employees play a significant role and have a great influence on the company. As
stated in the strategies, is clear, that Kempinski puts a strong focus on its
Based on information provided by Marcus
and van Dam (2012) is the media an important factor regarding the stakeholders
of a company. The media includes the internet, the television, the radio and
newspapers. It often has an influence on peoples’ opinion and can affect the
reputation of a company.
Kempinski Hotels S.A. is a company in a
very competitive service sector. If the media publics any negative information
or news, will it have an influence on individuals, which can be customers or
possible partners of the company.
company is able to have an influence stakeholder and change internal factors; however,
it is not possible for a company to have an influence on external factors,
which will be explained below.
External Factors can affect the company.
The threatening fact of these influences is, that the company cannot control
these influences but has to adapt to them. The PESTEL analysis is a suitable
tool to analyse the external influences. It will be conducted about Kempinski
Hotels headquarter in Switzerland.
The Schengen Agreement provides open
borders to Europe and increases tourism within Europe and Switzerland.
Based on Market Line (2017) is
Switzerland one of the most competitive economies in the world, because it has
a stable and modern economy. Furthermore, Switzerland has a well-developed
capital market and banking sector. Important is, that the difference in
exchange rates can lead to decrease/increase tourism, this can affect Kempinski
Hotels in certain regions, because it can be more expensive to visit a country
with another currency, such as Switzerland.
The aging population in Switzerland leads
to more money and time to travel which influences Kempinski Hotels S.A. in a
positive way, because it runs luxury and expensive hotels, which target group is
defined as people, who are looking for luxury holidays. Additional, leads the
increase in high education in Switzerland to an increase in tourism, because
people earn more money with higher education. However, an increase in fear of
terrorism in Europe leads to less tourists in Europe, which can also have
impacts on Switzerland.
The increase in booking opportunities, especially
online, leads to an increasing in tourism worldwide. Kempinski Hotels S.A.
offers booking opportunities on its own website, in travel agencies and online platforms.
These various opportunities for customers lead to easier booking possibilities
and more tourism. One further point is the increase in technological awareness.
This leads to higher pressure regarding the modern equipment and technology in
Kempinski Hotels worldwide. Kempinski Hotels S.A. has to make sure that each
hotel is equipped on to highest and newest standards.
The growing awareness of sustainability
leads to influences in tourism, Kempinski Hotels S.A. will have to adapt to
this change of awareness, in order to adapt to its customer needs. Global
natural disasters increase, that will affect a decrease in tourism, because
certain areas become dangerous to visit or victims need to spend money for
construction work instead of holiday. This affects Kempinski Hotels S.A.,
because the company runs 75 hotels all over the world. According to Market Line
(2017) has Switzerland a great influence on creating and developing global
agreements on sustainability and environmental protection. Since Kempinski
Hotels S.A. headquarter is in Switzerland, the company has to adapt to these
According to Market Line (2017) does
corruption barely exist in Switzerland, this leads to high transparency while
making business, which is positive for Kempinski Hotels S.A. Switzerland is
ranked as number five out of 176 countries all over the world in the
Transparency International’s Corruption Perceptions Index for 2016.
This report tried to provide an
understanding of Kempinski Hotels S.A management and operation, structuring and
its influencing factors, such as stakeholders and environmental factors.
Kempinski is a stock company with its
head office in Geneva, Switzerland. A stock company divides its capital into
shares. The biggest shareholder of Kempinski Hotels S.A are the sheiks of
Bahrain. The company has around 24.000 employees worldwide, and its CEO is
Markus Semer, since 2016. It is highly important for Kempinski to follow its
vision and mission, in order to achieve its goals in the future. Kempinski
wants to be renowned as a company who offers luxurious hospitality. This vision
shows the orientation of the company and the direction it wants to lead to. In
order to fulfil this vision, it is important to support it by strategies, which
help to reach Kempinski’s goals. Kempinski developed strategies, such as
focussing on employees and selective growth. The combination of all strategies provide
a clear plan, how the company wants to achieve its vision.
Kempinski’s business process is defined
with input, such as people, natural resources, such as new hotels, and capital.
The transformed and finished products are defined as hotels, jobs and the
service for customer, regarding food, drinks and spa. Kempinski deals with
several stakeholders, for example customers, suppliers, competitors and
employees. Furthermore, environmental factors have an influence on the company,
such as new technology and social development. These influences can not be
affected by Kempinski, but Kempinski has to deal with it and adapt to new
To conclude, it can be said, that the
company is successful, because it takes all analysed points of this report into
concern. It has an explicit vision and mission and its strategies are clearly
focussed on achieving its vision. Kempinski focusses highly on its employees,
because these are one of the most important stakeholders. The company has an
effective management board, which is able to fulfil the tasks of the top