Harvard Case - Roaring Dragon Hotel: A Second Attempt at Modernization
"Roaring Dragon Hotel: A Second Attempt at Modernization" Harvard business case study is written by Stephen Grainger. It deals with the challenges in the field of Organizational Behavior. The case study is 6 page(s) long and it was first published on : Dec 17, 2012
At Fern Fort University, we recommend a comprehensive and strategic approach to Roaring Dragon Hotel's modernization efforts, focusing on a culture of innovation, employee empowerment, and customer-centricity. This will involve a multi-pronged strategy encompassing change management, organizational development, talent management, and technology integration.
2. Background
Roaring Dragon Hotel, a family-owned establishment, faces a critical juncture. Despite its rich history and loyal customer base, the hotel struggles to compete in the modern hospitality landscape. The previous modernization attempt failed due to resistance from employees, lack of clear communication, and a failure to address the core issues of outdated infrastructure and a stagnant organizational culture.
The case study focuses on the challenges faced by the new General Manager, David Chen, as he attempts to revitalize the hotel. He inherits a resistant workforce, a lack of trust in management, and a deeply ingrained traditional culture that hinders innovation and adaptation.
3. Analysis of the Case Study
The case study highlights several critical issues:
- Organizational Culture: The hotel's traditional, family-oriented culture, while valuable in its history, hinders innovation and adaptability. The resistance to change stems from a lack of trust in management, fear of job security, and a lack of understanding of the need for modernization.
- Leadership: The previous management's lack of effective communication, consultation, and employee engagement fostered a culture of distrust and resistance. This highlights the importance of transformational leadership and emotional intelligence in driving change.
- Change Management: The previous modernization attempt failed due to a lack of proper planning, communication, and employee involvement. This emphasizes the need for a structured change management process, involving clear communication, employee training, and addressing concerns.
- Technology Integration: The hotel's outdated technology infrastructure hinders its ability to compete with modern hotels. Integrating new technologies, such as online booking systems, digital marketing tools, and customer relationship management (CRM) systems, is crucial for improving efficiency and customer experience.
4. Recommendations
Culture Shift:
- Vision and Values: Establish a clear vision for the future of the hotel, emphasizing innovation, customer satisfaction, and employee empowerment.
- Communication and Transparency: Implement open and transparent communication channels, fostering trust and engagement between management and employees.
- Employee Involvement: Actively involve employees in the modernization process, soliciting their feedback and ideas. This fosters a sense of ownership and reduces resistance.
- Training and Development: Provide training programs to equip employees with the skills and knowledge necessary to adapt to new technologies and customer expectations.
Leadership Development:
- Transformational Leadership: Encourage David Chen to adopt a transformational leadership style, focusing on inspiring and motivating employees, fostering a shared vision, and promoting individual growth.
- Emotional Intelligence: Develop David Chen's emotional intelligence, enabling him to understand and manage his own emotions and those of others, fostering empathy and effective communication.
- Team Building: Encourage team building activities to foster collaboration, trust, and a sense of shared purpose.
Change Management:
- Structured Approach: Implement a structured change management process, including clear communication, employee training, and addressing concerns.
- Pilot Projects: Start with pilot projects to test new technologies and processes, allowing for adjustments and learning before full-scale implementation.
- Reward and Recognition: Recognize and reward employees who embrace change and contribute to the modernization process.
Technology Integration:
- Needs Assessment: Conduct a thorough assessment of the hotel's technology needs, focusing on areas such as online booking, guest management, marketing, and customer service.
- Phased Implementation: Implement new technologies in a phased manner, starting with areas that have the most immediate impact and gradually expanding to other areas.
- Training and Support: Provide comprehensive training and support to employees on the use of new technologies, ensuring seamless integration and adoption.
5. Basis of Recommendations
These recommendations are based on several key factors:
- Core Competencies: The recommendations align with the hotel's core competencies, focusing on building a strong brand, enhancing customer experience, and leveraging technology to improve efficiency.
- External Customers: The recommendations prioritize customer satisfaction by improving the guest experience through technology integration, enhanced services, and a more responsive staff.
- Internal Clients: The recommendations aim to foster employee engagement and motivation by providing opportunities for growth, recognition, and involvement in the modernization process.
- Competitors: The recommendations consider the competitive landscape, ensuring the hotel remains relevant and attractive to modern travelers.
- Attractiveness: The recommendations are designed to be cost-effective and yield a positive return on investment through increased efficiency, customer satisfaction, and revenue growth.
6. Conclusion
By implementing these recommendations, Roaring Dragon Hotel can successfully navigate the challenges of modernization and secure its future in the competitive hospitality industry. The key to success lies in fostering a culture of innovation, empowering employees, and prioritizing customer satisfaction.
7. Discussion
Alternative approaches to modernization include:
- Outsourcing: Outsource certain functions, such as IT or marketing, to specialized companies. This can be cost-effective but may lead to a loss of control and potential issues with integration.
- Acquisition: Merge with or be acquired by a larger hotel chain. This can provide access to resources and expertise but may compromise the hotel's unique identity and family-oriented culture.
Risks:
- Resistance to Change: Employees may resist change due to fear of job security or a lack of understanding.
- Implementation Challenges: Implementing new technologies and processes can be complex and time-consuming.
- Financial Constraints: The modernization process may require significant financial investment.
Assumptions:
- Management Commitment: David Chen and the hotel's leadership team are committed to the modernization process and are willing to invest the necessary resources.
- Employee Willingness to Change: Employees are willing to embrace change and adapt to new technologies and processes.
- Market Demand: There is sufficient demand for the hotel's services in the market.
8. Next Steps
- Develop a Detailed Implementation Plan: Outline specific steps, timelines, and resources required for each recommendation.
- Communicate the Vision: Clearly communicate the vision for the hotel's future to all stakeholders, including employees, customers, and investors.
- Pilot Projects: Implement pilot projects to test new technologies and processes before full-scale implementation.
- Monitor Progress: Regularly monitor progress and make adjustments as needed.
- Employee Feedback: Continuously solicit employee feedback and address concerns to ensure buy-in and support for the modernization process.
By taking these steps, Roaring Dragon Hotel can successfully transform itself into a thriving and modern hospitality establishment, attracting new customers and retaining its loyal base.
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Case Description
The Roaring Dragon Hotel (RDH), a Chinese state-owned enterprise (SOE), was under pressure to become a profit generating 5-star hotel due to the continued development of the Chinese market economy. As for many SOEs, the RDH was overstaffed, filled with archaic work practices, internal cliques, unsystematic production systems and a dysfunctional motivation system unrelated to performance. During modernization, a number of human resource management problems became increasingly evident; solving these problems had become a priority. In 2000, the RDH's provincial government and stakeholders made their first attempt at modernizing the hotel by hiring a globally renowned company to undertake the upgrade. The disastrous outcome caused the provincial government and stakeholders to lose heart, momentum and motivation until six years later. A new joint venture owner and the RDH board recovered enough confidence to attempt modernization for a second time. They contracted Premium Hotel Services (PHS) to undertake the second attempt at improving operations. The PHS found the quality of older employees, increasing turnover of new staff and policies emerging from the continuing evolution of the Chinese economy were now presenting problems never confronted before at the RDH. How could the stakeholders solve these problems and have the RDH emerge as an internationally recognized five star, commercially viable hotel?
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