ThePortmanHotelCompany.docx
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ThePortmanHotelCompany.docx
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ThePortmanHotelCompany
CASEANALYSIS
ThePortmanHotelCompany
Problemstatement
InwhatwaysPortmanhighermanagementcouldreformulatetheirHRstrategyandtherebyleverageitshumanresourcetowardsfulfillmentoftheorganizationalobjectiveofprovidingapersonalizedexperienceintheAmericanluxuryhotelindustry.
PESTCAnalysisoftheIndustry:
∙Political:
NotApplicable
∙Economic:
✓PortmanaimedatbringingAsianstandardsofhospitalityintheU.S.whichwaslaborintensiveandinvolvedhighlaborcosts.ThePersonalValetapproachinvolvedthelaborcostwhichwasthreetimesascomparedtoAsia.HencePortmanHotelCompanywouldrequiremorecapitaltohirelabor.
✓Becauseofcheaplabor,AsianhotelscouldaffordthreeemployeesforeveryguestwhereasAmericacouldmanageonlya1:
1ratio.HencePortmanhadtostaynearthisratiotobecosteffective.
∙Social:
✓Thetargetconsumerscomprisedoftheluxurysegmentwhichneededcustomizedservice.
✓Customerswerenotaccustomedtothecultureofpayingtips,whensamewasaskedfor.
✓PortmanHotelwantedtoensureacomfortable,convenientandpersonalizedexperiencetoitsAmericancustomers.
✓LaborunionswerenotallowedtogrowbythePortmanmanagement.
✓Employeesweremadetosigncontract,whichgavetheemployeeduerights.
∙Technological:
NA
∙Cultural:
✓TheAmericanculturerevolvesaroundthephilosophyofselfserviceandhencecustomervisittohotelsdonotinvolveexpectationsongroundsofpersonalcommunication,serviceandextraordinarytreatment.
WhereasAsiancultureissuchwhichinvolvespersonalandcustomizedtreatmentbytheemployeestogivetheguestsapleasantandmemorableexperienceoftheirstayinthehotel.ThePersonalValetwouldtakecareofalltheneedsandrequestsoftheguestsandensurethattheyaretakencareofwell.
HenceintroducingtheAsiancultureofhospitalityintoAmericaandimplementingwasachallengeforPortman.
SWOTAnalysis:
INTERNALSTRENGTHS
-Abilitytoforeseethefutureandintroducetheconceptofanicheandluxuriousservice,whichinvolvedgettingtheAsianstandardsofhospitalitytotheU.S.
-Recognizedtheimportanceof“Intangiblepsychicneeds”oftheguestsandhencewantedtosatisfythatthroughamemorableexperiencethroughservancy.
-RealizedtheimportanceofEmployeesatisfactionandhencefocusedonpersonalaswellasprofessionalgrowthoftheemployee.
INTERNALWEAKNESSES
-Inabilitytokeeptheemployeesmotivatedandcommittedtowork.
-Weaktrainingskillsandinabilitytofocusontheemployeesneedsandkeepitsatisfiedallthroughout.
-AbsenceofaproperHRstructureandsuitablerewardsandefficiencychecksystems.
-InabilitytobeabletomeetitslongtermstrategyduetothegapbetweenexternalalignmentandInternalAlignment.
-Inabilitytosuccessfullyimplementandensurethattheobjectivesandgoalsofeachlevelofthehierarchyareachieved.Thevisionandmissionofthecompanyweresuccessfullytrickleddowntothelowerlevelsbutnoeffortwastakentoensurethatpropersystemswereintroducedtohelpachievethese.
EXTERNALOPPORTUNITIES
-BeingthefirsthoteltocomeupwithPersonalValetssystemandhencereapthebenefitsofbeingthefirstmoverintheindustry.
-TobecometheproviderofaworldclassluxuryexperiencetoitsguestsbysuccessfullyimplementingitsstrategywithaproperHRstructureasitsbackbone.
EXTERNALTHREATS
-Fearofthecontinuingincreaseinattritionrateduetotheinabilitytokeeptheemployeescontentedtostaywheretheyare.
-FearofunacceptabilityofbytheAmericansofthenewwayofserviceandcultureduetoimproperimplementationofitsgoalsandprocesses.
IMPORTANTQUESTIONSTOBEADDRESSED:
1.Portman’smarketpositionandMarketCompetitiveness:
PortmaniscurrentlythefirsttocomeupwiththePersonalValetssystem,thoughtherearetwohotelsthathaverecentlycomeupthataretryingtointroducetheAsianstyleofserviceintheUSmarket.HencethemarketislesscompetitiveandifPortmansuccessfullyintroducesaproperstructureandprocess,itcanreapthebenefitsofbeingthefirstmoverinthemarket.
2.Portman’sstrategytocompetesuccessfullyinthechosenmarket:
Thisinvolvesintroductionoftheniche-arevolutioninguestsservice,whichinvolvedgivingtheguestsanexperiencebyprofessional,cheerfulanimmediateresponsetoeveryrequest.
3.Attitudes,behaviorsandskillsexpectedfromitsemployeestoexecuteitsstrategy:
Thisincludespeoplewhohavetheabilitytodoalmosteverythingperfectlywithpositivity,focus,valuesandattentiontodetail.Employeeswhoarefriendlyandareintrinsicallymotivatedtoperformandgotheextramiletokeeptheirguestshappyareneededintheorganization.
4.Portman’spracticeswithrespectto:
(1)Recruitment:
Recruitpeoplethatarefriendlyandvoluntarilyreadytotakeinitiativesandenjoytheworkthattheydo.ThehiredSelectionResearchInc.(SRI),tolookforthepeoplewiththecharacteristicstheywerelookingfor.
(2)Selection:
Theyfollowedanextremelyselectiveprocess.Selectthosewhoexhibitedimmensepleasureinservingguestsandwhodidtheworknotjustasamerejobbutwhofeltliketheywereworkingfortheirownorganization.Thoseselectedweremadetostayatthejobforatleastoneyear.
(3)Compensation:
Theassociatesweremadetoexpectasmuchas$200aweekastip.Also,therewereotherextraslikeliberalreimbursementstooutsidecourses,accesstocafeteria,parties,$200fortheassociateofthemonthand$1000perweekinthehotelfortheassociateoftheyear.
(4)Training:
Employeesweregivena2weektrainingcoursewhereintheyweretaughtcleaningroomsandotherskillsneededonthejobaswellastojudgetheguestsandcategorizetheminto“lovers”or“rejecters”.
(5)CareerDevelopmentandCareerPaths:
EmployeesatPortmanweretaughtallthejobsnecessarytotakecareoftheguestsfromcleaningthebathroomstomixingadrink.Hencethismadethemmulti-taskingandmadetheirworkmoreinterestingandlessmonotonous.Buttheemployeeswereexpectedtobehappywiththeirpositionanddidn’thavemuchscopetoclimbuptheladder.ThePV’shadtobecontentedwiththeirposition.
(6)FeedbackandPerformanceAppraisal:
NotmuchattentionwaspaidtothisaspecthencePortmanlackedinknowingtheconcernsoftheoneswhowereindirectcontactwiththeirguests-theValets.Alsoduetolackofapropersystemofperformanceevaluationandappraisal,fewvaletsdidn’tperformtheirjobsandothersendedupmakingupforitwhichincreaseddiscontentamongstthem.
CRITICALFACTORS:
∙LackofaproperHRstructure
∙ExternalAlignmentandInternalAlignment
∙Increasingattritionrateanddisinterestedemployees
∙IncreasingcostsofhiringandmaintainingtheHumanResource
∙Achievementofitsstrategytocompetesuccessfullyinthemarketbytakingcareoftheabovementionedcriticalfactors
PROBLEMANALYSIS:
1)LackofProperHRstructure:
WhatislackinginPortmanisthepresenceofaproperHRstructureandpolicies.Asfarasrecruitmentisconcerned,Portmandoesrecruitandselecttheemployeestheyfeelsuitableaspertheirexpectationsandalsohaveanassociatecontractthatneedstobesignedbyeveryemployeewhichclearlydefinestheirworkboundariesandexpectationsthattheorganizationhasfromthem.
Butwhatismissingistheproperdemarcationofworkresponsibilitiesanddefiningjobs.Alsosincethereisnoproperperformanceevaluation,appraisalandfeedbacksysteminplace,PV’stendtotaketheirresponsibilitiesandtheirjobmorecasuallyduetowhichsomeofthemendupworkingtomakeupfortheothers.
Henceimplementationofthese2systemsisnecessarytofirstly,beabletoevaluateperformanceofeveryPVsoasbeabletoevaluatetheirefficiencyandsecondly,tomaketheemployeesfeelapartoftheorganizationbyencouragingthemtosharetheirconcerns,issuesandgivefeedbackonimportantissues.
2)ExternalAlignmentandInternalAlignment:
WhatwasalsolackinginPortmanwasthegapinaligningtheexternalaswellastheinternalresourcesandobjectives.Theinternalalignmentmeantacommittedandmotivatedworkforcewhoenjoyedprovidingtheirguestswithcustomizedandaworldclassluxuryexperience,andaligningthiswiththecompany’sstrategyandobjective..ThisrequiredsupportofaproperHRstructureandprocessinplace.
Theexternalalignmentmeantaligningyourservicesaspertheexpectationsofyourcustomersandsatisfyingtheirneedsandrequestsaccordingly.SincePortmanwasintroducinganewwayofservicingcustomers,whatwasrequiredisfulfillingandperformingthoseservicesefficientlytogiveapleasantexperiencetotheguests.
AlsowhatneedstobeaimedisachievingOrganizationalCitizenshipBehavior(OCB)andJobDedicationoutoftheemployees.Theemployeesneedtobesatisfiedthemselvestobeabletosatisfytheirguests.
3)Increasingattritionrateanddisinterestedemployees:
Portmanwasexperiencingagradualincreaseinthenumberoftheirdissatisfiedemployeesandtheirmotivationlevelsweredecliningdrastically.ThePV’sfeltthattheyweretreatedlikemoreofmaidsratherthanagroupcrucialtothebusinessstrategy.
ThiscouldberelatedtothePygmalionEffectwhichwasn’tpresentinthiscase:
Also,Kelley’sAttributionModelcanalsobeappliedinthiscasewherespecificinformationcanbeusedtomakespecificsocialattributionsforthebehaviorandoutcomesofothers:
(1)Consistency:
HerewhatcouldbeobservediswhetheranemployeeatPortmanbehavesinthesamefashionovertime.ThePV’swhoarenotworkingefficiently,theirbehaviorcouldbeexamin
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