When in “China” do as the Chinese do: a case study of IHG’s HUALUXE’S localization in China

Abstract

This case study explores the localization strategies that HUALUXE, an InterContinental Hotel Group brand, implemented in China and the reasons behind them. HUALUXE has been designed as a Chinese-featured hotel brand with key Chinese elements and unique Chinese hospitality and culture. HUALUXE's localized operation and management also helped the company gain a competitive advantage during the COVID-19 pandemic crisis. The operation performance of HUALUXE hotels had excelled in its market segment. This case study introduces the establishment and development of HUALUXE to illustrate how an international hotel group competed in the fierce global market to distinguish and position itself.

The Cultural Dilemmas for a Senior Expatriate CEO in China

“…Although localization may produce up-front costs, the localization strategies may lower the running costs (Hu et al, 2021). Staff localization, especially senior executives' localization, enables the decision-making authorities to be influenced by locals who know the habits of the local culture better (Hu et al, 2021). Specifically, senior executives' localization could adjust the normative rules and value of the subsidiary in daily operation to fit the locally acceptance values, norms, and practices; this, in turn, could accelerate the staff localization process on the rest of staff and increase the reputation of the business in the local society (Rosenzweig & Singh, 1991).…”

“…From the very beginning, localization involves utilizing domestic staff so that those who know the local culture can make affable strategies that fit local habits, possibly resulting in better business performance (White & Griffith, 1997). Although localization may produce up-front costs, the localization strategies may lower the running costs (Hu et al, 2021). Staff localization, especially senior executives’ localization, enables the decision-making authorities to be influenced by locals who know the habits of the local culture better (Hu et al, 2021).…”