Harvard Case - Courtyard by Marriott
"Courtyard by Marriott" Harvard business case study is written by James L. Heskett, Roger Hallowell. It deals with the challenges in the field of Service Management. The case study is 20 page(s) long and it was first published on : Sep 18, 1992
At Fern Fort University, we recommend Courtyard by Marriott implement a strategic plan focused on enhancing customer experience through service innovation, digital transformation, and employee empowerment. This will involve a multi-pronged approach encompassing service design, operations optimization, marketing strategy, and organizational culture.
2. Background
The case study focuses on Courtyard by Marriott, a mid-scale hotel chain facing increasing competition from both traditional and non-traditional players. The company seeks to maintain its competitive edge by improving customer service and operational efficiency, while adapting to evolving customer expectations and technological advancements.
The main protagonists are:
- John B. Rattner, CEO of Marriott International, who is tasked with driving the company's growth and innovation.
- Steve Rudolph, the Courtyard by Marriott brand manager, who is responsible for developing and implementing strategies to enhance the brand's appeal and profitability.
- Courtyard by Marriott customers, who are increasingly demanding personalized experiences, seamless technology integration, and value for money.
3. Analysis of the Case Study
Competitive Landscape: The hotel industry faces intense competition from both traditional players like Hilton and Hyatt, and non-traditional players like Airbnb and VRBO. Courtyard by Marriott must differentiate itself by offering a unique value proposition, leveraging its existing strengths, and adapting to changing customer preferences.
Customer Expectations: Modern travelers prioritize convenience, technology integration, personalized experiences, and value for money. Courtyard by Marriott needs to cater to these evolving needs by embracing digital transformation, offering flexible service options, and providing personalized experiences.
Internal Challenges: The case highlights the need for improved employee empowerment, service quality, and operational efficiency. Courtyard by Marriott must invest in training and development programs to enhance employee skills and motivation, while streamlining operations to improve efficiency and reduce costs.
Strategic Frameworks:
- SERVQUAL Model: This framework can be used to assess the gaps between customer expectations and perceptions of service quality. Courtyard by Marriott can leverage this model to identify areas for improvement in its service delivery.
- Service Profit Chain: This framework highlights the link between employee satisfaction, customer loyalty, and profitability. By investing in employee empowerment and development, Courtyard by Marriott can create a positive cycle leading to increased customer satisfaction and financial success.
- Customer Journey Mapping: This tool can be used to visualize the customer experience at each touchpoint, identifying areas for improvement and potential service innovation.
4. Recommendations
1. Enhance Customer Experience Through Service Innovation:
- Digital Transformation: Implement a comprehensive digital strategy, integrating mobile check-in, keyless entry, mobile ordering, and personalized recommendations through a user-friendly app.
- Service Design: Refine the customer journey by introducing new services like express check-out, self-service kiosks, and personalized concierge services.
- Service Blueprinting: Develop detailed service blueprints to ensure consistency and efficiency in service delivery across all touchpoints.
- Service Recovery: Implement robust service recovery procedures to address customer complaints and ensure positive resolution.
2. Optimize Operations for Efficiency and Cost Reduction:
- Process Analysis: Conduct a thorough analysis of existing operational processes to identify inefficiencies and areas for improvement.
- Technology Integration: Leverage technology to automate tasks, optimize resource allocation, and improve communication channels.
- Service Standardization vs. Customization: Strike a balance between service standardization and customization to ensure efficiency while maintaining a personalized experience.
- Service Capacity Management: Optimize service capacity by implementing flexible staffing models and forecasting demand accurately.
3. Implement a Robust Marketing Strategy:
- Branding: Strengthen the Courtyard by Marriott brand by emphasizing its unique value proposition and target audience.
- Marketing Mix: Utilize a mix of digital marketing, social media, and traditional channels to reach potential customers.
- Customer Relationship Management (CRM): Implement a comprehensive CRM system to collect customer data, personalize marketing messages, and build loyalty.
- Customer Loyalty Programs: Develop a loyalty program to reward repeat customers and encourage continued patronage.
4. Foster a Culture of Employee Empowerment and Innovation:
- Hiring and Recruitment: Develop a robust hiring process that attracts and retains talented employees with a strong service orientation.
- Employee Empowerment: Empower employees to make decisions and solve customer problems, fostering a sense of ownership and responsibility.
- Employee Incentives: Implement performance-based incentives to motivate employees and reward excellence in service delivery.
- Employee Performance Management: Develop a comprehensive performance management system to track employee progress, provide feedback, and identify areas for improvement.
5. Basis of Recommendations
These recommendations are based on the following considerations:
- Core Competencies and Consistency with Mission: The recommendations align with Courtyard by Marriott's mission to provide a comfortable and efficient hotel experience.
- External Customers and Internal Clients: The recommendations address the needs of both external customers and internal clients, including employees, franchisees, and investors.
- Competitors: The recommendations aim to differentiate Courtyard by Marriott from its competitors by emphasizing service innovation, technology integration, and customer experience.
- Attractiveness: The recommendations are expected to lead to increased customer satisfaction, improved operational efficiency, and enhanced profitability.
6. Conclusion
By implementing these recommendations, Courtyard by Marriott can achieve a significant competitive advantage by enhancing customer experience, optimizing operations, and fostering a culture of innovation. This will enable the company to maintain its position as a leading mid-scale hotel chain in a rapidly evolving market.
7. Discussion
Alternatives:
- Merging with another hotel chain: This could lead to economies of scale and increased market share, but it may also require significant restructuring and cultural integration.
- Focusing solely on cost reduction: This could improve profitability in the short term, but it may negatively impact customer experience and long-term growth.
Risks and Key Assumptions:
- Technology adoption: The success of the digital transformation strategy depends on the successful adoption and integration of new technologies.
- Employee buy-in: Employee empowerment and innovation require a shift in organizational culture and a commitment from all levels of the organization.
- Customer acceptance: The success of new services and offerings depends on customer acceptance and willingness to embrace change.
8. Next Steps
- Develop a detailed implementation plan: Outline specific actions, timelines, and resources required for each recommendation.
- Pilot test new services: Conduct pilot tests of new services and offerings to gather customer feedback and refine the implementation strategy.
- Communicate the strategy: Clearly communicate the strategic vision and implementation plan to all employees, franchisees, and stakeholders.
- Monitor progress and adjust as needed: Regularly monitor progress, measure results, and make adjustments to the strategy as needed.
By taking these steps, Courtyard by Marriott can successfully implement its strategic plan and achieve its goals of enhancing customer experience, improving operational efficiency, and fostering a culture of innovation.
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Case Description
Courtyard by Marriott, a chain of modestly priced hotels, weighs its future options regarding human resources, its service delivery system, and management structure. Fairfield Inn, another Marriott product, is discussed for contrast.
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