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Case Study: The Georges Hotel: Submitted To: Prof. (DR.) S. Rangnekar Department of Management Studies IIT Roorkee
Case Study: The Georges Hotel: Submitted To: Prof. (DR.) S. Rangnekar Department of Management Studies IIT Roorkee
Submitted to:
Prof. (Dr.) S. Rangnekar
Department of Management Studies
IIT Roorkee
INDIAN INSTITUTE OF TECHNOLOGY ROORKEE
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The Georges Hotel: Description
The Hotel
• 163 guest rooms, 65-70 employees.
• Front desk: 10 employees.
• Valet parking services: 8 employees.
• Housekeeping: 28 employees.
• Engineering and facilities maintenance: 4 employees.
• Management and administrative: 15-20 additional staff members assigned to
departments throughout the hotel, including management, office support and
sales.
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The Characters in the Case:
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Mission of the Organization
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Organizational Chart: The Hotel
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Organizational Chart: The Garden Terrace
Restaurant
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Recruitment Policies of the Hotel
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SWOT
• What threats can you identify that may negatively impact the company’s
future?
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STRENGTH
• Family environment in the company , it has always been the essence of the The Georges
hotel.
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STRENGTH
• Stability: Family position typically determines who leads the business and as a result there
is usually longevity in leadership, which results in overall stability within the organization.
Leaders usually stay in the position for many years, until a life event such as illness,
retirement, or death results in change.
• Commitment: Since the needs of the family are at stake, there is a greater sense of
commitment and accountability. This level of commitment is almost impossible to generate
in non-family firms. This long term commitment leads to additional benefits, such as a better
understanding of the industry, organization and job, stronger customer relationships and
more effective sales and marketing.
• Flexibility: There is no certain ”job description "in a family business. Family members are
willing to wear several different hats and to take on tasks outside of their formal jobs in
order to ensure the success of the company.
• Long-term Outlook: Non‐family firms think about hitting goals this quarter, while family
firms think years, and sometimes decades, ahead. This “patience” and long- term
perspective allows for good strategy and decision-making.
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Weakness
Family
Family
Conflict
Conflict
Succession
Succession Unstructured
Unstructured
Planning
Planning Governance
Governance
Nepotism
Nepotism
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Weakness
• Nepotism has worked well for staffing the current hotel, but Cindy recognizes the
downsides to hiring friends and family and knows it will not be adequate for staffing a
multiunit organization. For example, there is an assumption among some employees that if
you are a close friend or are related to a supervisor or a manager, you have a job at the
hotel for life.
• There are also attendance problems, but everyone protects their friends and family, and
employees have little accountability for performance.
• Family Conflict: Conflict is bound to happen at any firm, but when generations come
together conflicts are bound to happen even more. Deep-seated, long-lasting bitter fights
and quarrels can affect every single person within the firm and can draw divisive lines.
Since family members are involved long term quarrels can become difficult to resolve and
result in difficult endings.
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Unstructured Governance: Governance issues such as internal hierarchies and rules, as
well as the ability to follow and adhere to external corporate laws, tend to be taken less
seriously at family businesses, because of the level of trust inherent at family firms.
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OPPORTUNITY
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THREATS
• Since there has been high nepotism in the staff this can lead to high dissatisfaction among
the employees who are not relatives of the management and can lead to high distress
among the staff.
• No succession plan. At some point, a member of the team may retire, leave or even
worse, die. Just imagine what would happen to a business if there was no succession plan
in place for the unexpected loss of a key member, or worse, the only member of the
team. Research shows that nearly two-thirds of family businesses do not survive the
transition from first generation to second generation. Some of that failure is attributable to
the next generation not having a desire to carry on the business, but more importantly and
significantly, it is due to poor transitional planning.
• Feuds within the family. Family businesses are faced with the challenge of internal
conflicts that come about from the inability to separate business and personal lives. The
feud could be for a host of reasons, such as varied interest, difference of opinion, or
personal rivalry that works its way into the business. Whatever the cause, it is important to
work through these conflicts as achieving common goals will become increasingly difficult,
and the stress placed on staff may cause them to leave.
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• Allowing your emotions to run the business. You may recall this line from The
Godfather –“It’s not personal, it’s business.” This is easier said than done, especially in a
family owned business, and especially if you are managing a family member. Emotions do
become personal, and allowing them to run the business can significantly interfere in your
interactions with employees and customers. Your emotions could make you appear weak,
and severely affect your ability to make sound decisions. On the other hand, if you appear
cold and insensitive, you may be regarded as unapproachable. You will need to determine
the right balance of emotion based on the dynamics of your business environment.
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Scenario A
Players involved:
Michael Mitchell,
sales and operations
associate
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Description of the Scenario A
• Jeff, Chad and Cindy were excited about the new hotel. It was an opportunity to expand
the Georges and to create a legacy for the children.
• Managing the hotel was good work and they wanted to implement the same policies for
expanding the business.
• Jeff was involved highly during the construction period of the business and being out
there. Chad was not much involved during the inception and construction part and was
more interested in sitting in his nicely decorated office.
• Jeff and Cindy went knew the staff individually. For expanding they will be hiring and
managing a lot of new employees for jobs at other locations quite soon, and they won’t
know everyone the way they do now.
• In the end there is a conflict of interest in deciding who will be the next CEO
Julie or Michael.
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■What are the pros and cons of a family-
owned business?
■What should be recommended to reduce
the negative aspects of operating a family
business and to capitalize on the positive
aspects?
■How can Jeff and Cindy make family an
asset going forward into a multiunit
organization?
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Negative aspects of a family-owned
and managed business
Ego Issues
Promotion Disagreements
Negative
aspects
Sense of Preferential
belongingness Treatment
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Positive aspects of a family-owned and
managed business
Loyalty
Knowledge
transfer Trust
Positive
aspects
High Employee Less
Commitment recruitment
Legal costs
and Tax
Benefits
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Recommendations to reduce negative aspects and
capitalize on positive aspects
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Reducing Negative Aspects
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Capitalising on Positive Aspects
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Making family business into multiunit organisation
Documentation of
defending double standard
Appropriate employee
benefits policies
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Let us look into “The Three Circle” Model!!
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What Cindy thinks should be done!!
• Hiring to be done outside of family as they have already hired nearly all the
relatives that are available.
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Strategic Planning
• Strategic planning is a management activity that is used to set priorities, focus resources,
to ensure that employees and other stakeholders are working toward common goals &
adjust the organization's direction in response to a changing environment.
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Strategic Planning
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Strategic Plan: Year 1
Understanding of the environment in which the
hotel operates.
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Recommended Activities
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Probable outcomes of the activities
The Swot analysis would enable Cindy and Jeff to get the overall idea of the
Hotel Industry and changes that should be implemented
Defining the long term goals would help Jeff and Cindy to make clear short
term goals directed towards achieving long term goals
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Strategic Plan: Year 2
Designing of new policies and goals
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Recommended Activities
Ensure that policies are consistent with the organization’s mission and values.
Assess employee development gaps and ensure that staff is trained and ready for the
organization expansion
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Probable outcomes of the activities
Estimating the training gaps would ensure the timely trainings and
knowledge transfers among the employees
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Strategic Plan: Year 3
Evaluation of the Process
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Recommended Activities
Hire additional staff, conduct onboarding activities and provide training that meets
the needs of the expanded organization
Evaluate and monitor processes, and update them as needed to ensure that
new procedures are appropriate for hotels that will be added in the future.
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Probable outcomes of the activities
Onboarding and Recritment would ensure the selection of the best candidate.
Training would help the new recruits to get well adapted with the culture
and values of the organization
After opening the second hotel ,it would be time to implement the
organization restructuring
Voice of the employees would enable a feedback mechanism for the process
and would be in lines with the mission of the company.
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Conclusion
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Research Paper 1
Title: Identification of growth factors for small firms: evidence from hotel companies on an island (2016)
Journal of Organizational Change Management, Vol. 29 Issue: 6, pp.994-1029
Authors: Senem Yazici, (Department of Hospitality Management, Muğla Sıtkı Koçman University,
Muğla, Turkey)
Abstract: The purpose of this paper is to mainly investigate what factors drive growth for independent
hotel firms on an island. Design/methodology/approach.
First - To identify hotels demonstrated significant growth; 92 independent hotels in North Cyprus
were analyzed via a self-report questionnaire.
Second - Key growth factors were examined in five hotels showing the growth over years
among the independent hotels via in-depth, semi-structured interviews, focus group interviews,
and observations.
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Continue…
Findings:
The study findings revealed 6 important growth factors for hotels, including active risk
taking, education, family history, networks of contacts, customer concentration, age of founders.
The research findings unveil new factors referred to as “political conflict – pursuing different
strategy and opportunities,” importance of second generations affect and entrepreneur’s
metacognitive strategies, “informal networking.”
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Research Paper 2
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Continue…
• Results:
Family business managers were asked to indicate advantages and disadvantages of family
enterprises.
-More interesting in terms of identifying training needs are the perceived disadvantages of a
family business: Half of the sample thinks that entrepreneurs have to invest more work and time
when the enterprise is a family business.
-In the qualitative pilot test several key areas of family business management could be identified as
critical for their performance, including human resource management, cooperation management,
and strategy planning.
-The influence of the family business system on the entrepreneurs' job satisfaction was also
identified as a key factor.
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Books for further reading
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Books for further reading
Abstract:
This books gives an inside look at how family
relationships affect the success or the failure of the
family business. There are many conflicts inside the
family that need to be taken care of.
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