Literature Review about the franchising in hospitality industry Term Paper

Literature Review about the franchising in hospitality industry - Term Paper Example Hotels’ operating budgets need to select the right markets for growth, the best partners with experience and the ability to handle different clients effectively while also developing partnerships with the franchisee and the local cultures. â€Å"In order to work effectively with local people, we need to examine their values, norms, beliefs, relationships, and many other cultural characteristics† (Shakerin, 2006, p.1). When large hotels desire to expand their businesses overseas to foreign markets, it makes sense to select local investors to operate their establishments so that better connections can be made with foreign clients. If these customer service elements were to be managed by corporate offices, expatriate costs and training costs could be quite large. Franchising allows opportunities to reduce these high costs by inviting investment from overseas and allowing like cultural leaders to run the business units. â€Å"Leaders expecting to be effective in multi-cultural environments have to develop awareness of different cultural dimensions most central to their customers† (Shriberg & Kumari, 2008, p.20). If Marriott Hotels, as one example, decided to expand their presence into India, it would make the most sense to inspire an Indian investor to take on the responsibility of managing a Marriott franchise. This type of local investor maintains the cultural awareness and social skills necessary to satisfy local customers more than an expatriate manager sent overseas to govern the hotel. Geert Hofstede described the elements of culture that drive local tastes and preferences. In individualistic societies, people are self-expressive and put their personal goals and interests ahead of others (Blodgett, Bakir & Rose, 2008). In collectivist countries, such as India, people are more family-oriented and tend to believe in the rights and needs of the group. These are important