Case Study – The Imperial Hotel, London

Case Study – The Imperial Hotel, London

The assessment is based on a business and management case study which requires a team-based approach to identifying and problem-solving a range of business and management challenges within the case. Within the individual report you will include a summary and key justifications for the resolution of one of the problems - in this case, it will be about:

Problem 6: 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.

The report will be an individual 2,000 words report. 

Suggested report format:

§ Introduction – explain the background to your individual problem in the context of the case (250 words approx.). Does not need to explain the hotel structure because is already given being a study case. It will be helpful to present some theory about management and leadership.

§ Analysis of the individual problem – Summarise and interpret the data from your secondary research into published literature and management theory. Describe and present your results for effective management of the problem. A summary and justification of key proposals for the resolution of the problem in the organisation (1500 words approx.)

§ Conclusion – This should be a brief summary of findings of the analysis of the individual problem. (250 words)

§ Bibliography: 12 references, Harvard style. 

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.

The facilities at the hotel include the following:

·         500 bedrooms, all with en-suite facilities.

·         Conference facilities for 1,000 people

·         Leisure centre with swimming pool

·         3 Bars and 4 restaurants

·         12 conference rooms

Staff:

·         6 Heads of Departments: Food and Beverage; Housekeeping; Guest Services & Concierge; Front of House & Reception; and Human Resources & training.

·         450 staff in total (300 full-time and part-time)

·         Outside contractors (for specialist cleaning; laundry services; management of the leisure centre;)

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 65% in the company’s benchmark grading system; the overall sales in the hotel are improving, and 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. This 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.

Planned Strategy for Resolving the Problems in the Hotel

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 six problems for the hotel for the coming year. He identifies the problems as follows and Peter has put forward some initial suggestions for resolving each of the problems:

·         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: Ineffective leadership and management by previous Heads of Department and supervisory staff including poor monitoring and control procedures

·         Problem 5: Front of house staff (Reception, Conference & Banqueting, and Restaurant & Bars)

·         Problem 6: Back of house staff (Housekeeping, Kitchen, Maintenance)

The Problem in detail

Problem 6: 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

Staffing the Housekeeping Department at the Imperial hotel is always a challenge. There are up to 400-500 rooms to service a day, and this overseen by the Executive Housekeeper and 12 supervisory and administration staff. In the past year, it has proved very difficult to recruit room attendants, and those who are employed only tend to stay for no longer than 6 months. The staff turnover in the department is currently 60% a year. The hotel therefore resorted, two years ago to using a recruitment agency, ABC (International) to fill 30 of the 50 room attendants  jobs in the departments.  The 20 in-house staff are a hardcore of long-term employees who have worked for the company for many years.

ABC (International) is a recruitment company run by Charles Santos who has considerable experience in the hotel industry in England and Spain. Each candidate is interviewed and assessed on their English before they are included on the database. All candidates produce three references which are checked by ABC prior to their departure from Spain. They must have considerable practical experience of working in a hotel housekeeping department before taking up a post.  If the hotel cannot provide staff accommodation then ABC will organise it for them.

The quality of the Spanish staffs’ work is good overall, and the cost of employing the staff through the agency is only marginally more expensive that employing home staff. The Spanish staff tend to stay with the hotel for up to a year. The Spanish staff prefer to work together in their shifts with other Spanish staff, and are supervised and provided on-the-job training as to the brand standards for the hotel by the in-house Assistant Head Housekeeper, herself a fluent Spanish speaker.

There has been considerable discontent from the in-house room attendant claiming that the Spanish staff are un-cooperative when asked to work with non-Spanish staff. The Spanish staff are used to working in teams in their shifts, working together in pairs who are allocated 20 room a day to service. The standard of the in-house staffs’ working has been dropping. The hotel uses the Texlon system, which is a hand-held tracker system whereby a supervisor will undertake a sample check of the room standards and rank and score the standards of a serviced room. The results are subsequently plugged into the hotel computer and each member of staff is given a ranking out of 100. The Spanish staff (75%+ scores) consistently score higher than the in-house staff (60%-65%), which again has caused considerable resentment. The attendance of the in-house staff, all employed on full-time contracts, is getting progressively worse which has put pressure on the housekeeping budget.

There have recently been a number of complaints from hotel guests, who have not been happy with the general level of cleanliness in the hotel bedroom and in particular the bathroom. There have also been a number of complaints about housekeeping room attendants being abrupt and sometimes rude. When these cases have been investigated, it is becoming clear that full-time staff have poor motivation levels.

Initial suggestion by Peter Farnsworth to manage the problem:

·         Consider using other contacted staff through specialist agencies

·         Employ students on zero hour contracts only

·         Offer a range of incentive and bonus schemes to encourage staff to perform to a higher standard

Tasks

As an independent consultant, you have been asked by Peter Farnsworth to take responsibility for analysing the problem, commenting on Peter Farnsworth’s initial suggestions, and putting forward a joint set of resolutions for the listed problems. You are therefore to put forward and prioritise proposals for the resolution of the problem. The expectation is that within 12 months there should be dramatic improvement and change in performance in all six areas. You have asked to write a 2,000 word report addressing your single problem topic to attempt to resolve that problem in the hotel.

Staff Incentive Schemes

There are currently a number of incentive schemes to encourage staff to meet excellent standards of work, and to improve productivity. These include: Employee of the Month (for the whole hotel - £200) and employee of the month for each department (£50); staff (including agency staff) consistently meeting individual and performance targets in three consecutive months within the department (£200 vouchers towards staying in any one of Star Hotels); department, end-of-year parties (funded by the hotel); college fees being paid (NVQ levels 2-4).

Questions you should asking yourself when analysing the problem:

-       Which style of management would be appropriate to resolve these problems in the short and longer term? (autocratic, bureaucratic, democratic or laissez-faire)

-       How do you get the staff to change their attitude and practices and take ownership? (e.g. which incentives are needed? Participation of staff? Training? Inspiration? Trust? Proper supervision? Allow creativity/flexibility in their work?)

-       Are these just about poor operations or is there a broader issue about negative work cultures?

-       Does the hotel industry have a collective culture (e.g. London) which restricts the way Peter can effect change? (e.g. London is expensive, extremely competitive, traditional work culture which is process and results driven).

-       What are the advantages and disadvantages of Peter Farnsworth’s suggestions for managing the problem?

-       How does your problem relate to the other 5 problems? Is success in resolving this problem conditional on any one of the other problems being resolved as well?

-       Which operational procedures (and SOPs) do the staff need to focus on within any of the problems? What monitoring and control procedures are important and why 

-       How can Peter get HR involved in resolving the problems?

The assessment is based on a business and management case study which requires a team-based approach to identifying and problem-solving a range of business and management challenges within the case. Within the individual report you will include a summary and key justifications for the resolution of one of the problems - in this case, it will be about:

 

Problem 6: 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.

The report will be an individual 2,000 words report. 

Suggested report format:

§  Introduction – explain the background to your individual problem in the context of the case (250 words approx.). Does not need to explain the hotel structure because is already given being a study case. It will be helpful to present some theory about management and leadership.

§  Analysis of the individual problem – Summarise and interpret the data from your secondary research into published literature and management theory. Describe and present your results for effective management of the problem. A summary and justification of key proposals for the resolution of the problem in the organisation (1500 words approx.)

§  Conclusion – This should be a brief summary of findings of the analysis of the individual problem. (250 words)

§  Bibliography: 12 references, Harvard style.

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.

The facilities at the hotel include the following:

·         500 bedrooms, all with en-suite facilities.

·         Conference facilities for 1,000 people

·         Leisure centre with swimming pool

·         3 Bars and 4 restaurants

·         12 conference rooms

Staff:

·         6 Heads of Departments: Food and Beverage; Housekeeping; Guest Services & Concierge; Front of House & Reception; and Human Resources & training.

·         450 staff in total (300 full-time and part-time)

·         Outside contractors (for specialist cleaning; laundry services; management of the leisure centre;)

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 65% in the company’s benchmark grading system; the overall sales in the hotel are improving, and 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. This 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.

Planned Strategy for Resolving the Problems in the Hotel

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 six problems for the hotel for the coming year. He identifies the problems as follows and Peter has put forward some initial suggestions for resolving each of the problems:

·         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: Ineffective leadership and management by previous Heads of Department and supervisory staff including poor monitoring and control procedures

·         Problem 5: Front of house staff (Reception, Conference & Banqueting, and Restaurant & Bars)

·         Problem 6: Back of house staff (Housekeeping, Kitchen, Maintenance)

The Problem in detail

Problem 6: 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

Staffing the Housekeeping Department at the Imperial hotel is always a challenge. There are up to 400-500 rooms to service a day, and this overseen by the Executive Housekeeper and 12 supervisory and administration staff. In the past year, it has proved very difficult to recruit room attendants, and those who are employed only tend to stay for no longer than 6 months. The staff turnover in the department is currently 60% a year. The hotel therefore resorted, two years ago to using a recruitment agency, ABC (International) to fill 30 of the 50 room attendants  jobs in the departments.  The 20 in-house staff are a hardcore of long-term employees who have worked for the company for many years.

ABC (International) is a recruitment company run by Charles Santos who has considerable experience in the hotel industry in England and Spain. Each candidate is interviewed and assessed on their English before they are included on the database. All candidates produce three references which are checked by ABC prior to their departure from Spain. They must have considerable practical experience of working in a hotel housekeeping department before taking up a post.  If the hotel cannot provide staff accommodation then ABC will organise it for them.

The quality of the Spanish staffs’ work is good overall, and the cost of employing the staff through the agency is only marginally more expensive that employing home staff. The Spanish staff tend to stay with the hotel for up to a year. The Spanish staff prefer to work together in their shifts with other Spanish staff, and are supervised and provided on-the-job training as to the brand standards for the hotel by the in-house Assistant Head Housekeeper, herself a fluent Spanish speaker.

There has been considerable discontent from the in-house room attendant claiming that the Spanish staff are un-cooperative when asked to work with non-Spanish staff. The Spanish staff are used to working in teams in their shifts, working together in pairs who are allocated 20 room a day to service. The standard of the in-house staffs’ working has been dropping. The hotel uses the Texlon system, which is a hand-held tracker system whereby a supervisor will undertake a sample check of the room standards and rank and score the standards of a serviced room. The results are subsequently plugged into the hotel computer and each member of staff is given a ranking out of 100. The Spanish staff (75%+ scores) consistently score higher than the in-house staff (60%-65%), which again has caused considerable resentment. The attendance of the in-house staff, all employed on full-time contracts, is getting progressively worse which has put pressure on the housekeeping budget.

There have recently been a number of complaints from hotel guests, who have not been happy with the general level of cleanliness in the hotel bedroom and in particular the bathroom. There have also been a number of complaints about housekeeping room attendants being abrupt and sometimes rude. When these cases have been investigated, it is becoming clear that full-time staff have poor motivation levels.

Initial suggestion by Peter Farnsworth to manage the problem:

·         Consider using other contacted staff through specialist agencies

·