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Management in Organizations: Case Study of the Imperial Hotel in London

Knowledge Outcome

Knowledge outcome – On completion of this module you will be able to demonstrate an understanding of the processes, procedures and practices for effective management in organisations.

Intellectual /transferrable skill outcome – Students who successfully complete this module will be developing your competence in using a range of basic analytical and managerial techniques and processes including objective setting, monitoring and evaluation as well as interpersonal skills of successful managers.

Students will be developing an understanding of and using techniques to solve business problems with awareness of commercial acumen as well as developing your ability to write reports and have confidence in team working.

The assessment is based on a business and management case study which requires a critical approach to identifying and problem-solving a range of business and management challenges within the case. Throughout the term you will undertake research and analysis which will inform your individual report. Within the individual report you will include a summary and key justifications for the resolution of one of the problems in the case supported by management theories and principles.

The report will be an individual 2,000 words report which will address one of the five specific ‘problems’ identified in the case (e.g. a human resource management challenge, an ethical problem, a performance and productivity issue, etc). You will receive a full briefing in Week 4.

Students will be expected to apply management theory to practice throughout the report.

Case Study – The Imperial Hotel, London

The Imperial Hotel is a London 500 bedroom hotel, which is owned and managed part of a well-known international branded chain of hotels in the 4 star market – Star Hotels which operates 25 hotels in the UK. The Imperial Hotel, located in the heart of London’s West End, caters for mainly international business and tourists guests who have high expectation in terms of service standards.

A new General Manager, Peter Farnsworth, has recently taken over the management of the whole hotel. He is an experienced manager having worked in several of the other Star city centre hotels outside London.  The previous General Manager, who had just retired, had been experiencing a range of problems in managing the hotel, namely that:

·There was a very high turnover of staff in all the departments running around 80% a year mainly due to poor staff morale;  

·The hotel was graded the lowest in the whole Star chain in terms of overall guest satisfaction running at a rate of 60% in the company’s benchmark grading system; the overall sales in the hotel are improving,

Intellectual/Transferrable Skill Outcome

·Although the hotel occupancy (the ratio of rooms sold against the total number of rooms available) was running at 90% for the year, the actual average room rate (ARR) achieved, currently running at £95 per room per night was relatively low compared to the local competition.

·The poor performance is having a direct negative effect on the costs of the hotel and the hotel’s overall profitability.

The Imperial is an old hotel having been in operation for nearly 100 years. The hotel was last fully refurbished some 8 years ago but is now in need of some restoration and redecoration. There is a programme of staged refurbishment in place which means each floor of the hotel is being closed for building work to be undertaken. The consequence of this is that, at any one time for the next two years, 60 rooms will be out of action. This is putting the hotel under budgetary pressure due to the ongoing building costs as well as the loss of income from the 60 rooms out of action at any one time.

Peter Farnsworth is under no illusion as to the challenges ahead and has decided to plan a strategy for resolving the operational, management and business-related problems in the hotel. The first part of the plan is to identify the top five problems for the hotel for the coming year. He identifies the problems as follows:  

·Problem 1: Poor guest satisfaction

·Problem 2: High staff turnover with 80% of the staff leaving within the year

·Problem 3: A negative work culture amongst the staff with high levels of sick leave and poor attendance

·Problem 4: Front of house staff (Reception, Conference & Banqueting, and Restaurant & Bars )– poor team working and inefficient use of IT systems including the reservation and property management systems

·Problem 5: Back of house staff (Housekeeping, Kitchen, Maintenance) – poor operating and control procedures in place with stock being regularly pilfered and evidence of staff not meeting basic Standard Operating Procedures (SOPS) resulting in unusually high operating costs

Tasks

As an independent consultant, you have been asked by Peter Farnsworth to take responsibility for analysing one of the five problems, putting forward and prioritise the problem.

Tasks for the report:

·Discuss the problem’s likely causes from a management and operational perspective including any relationships with the other 4 problems

·Put forward a 3 point plan for resolving the problem particularly in terms of improving the quality of service, staff morale, operational efficiency and productivity to make the hotel financially sustainable.

·Support your answer with management and operations theories and principles

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