2021 Volume 10 Issue 1 Pages 72-77
During 2010’s, hotel groups in Japan have grown as Japanese customers’ demand has shifted from traditional Japanese inns, Ryokan to the Western style accommodation, hotels. In addition, the number of inbound tourists from overseas, mainly Asian countries, has rapidly increased. Recently, hotel groups and chains have developed across counties and extended internationally through strategic alliances (none-quity-based mode) rather than full ownership (equity-based mode), because of small financial investment, low managerial risks and fast partnership expansion. However, in Japan, major hotel groups have grown through full ownership rather than strategic alliance. From the viewpoint of multi-unit management, in order to correspond for rapid growth of customer demands in the short term, Japanese hotel groups preferred direct control of their subsidiaries and local partners with standard service package, service quality improvement and direct investments rather than indirect control with strategic alliance. This paper aims to examine the effect of direct control and knowledge transfer approach for rapid expansion and coordination of multi-unit organization in hotel industry, using 2019 data of ownership and contract in Japanese hotel groups.
