Imperial Hotel Case Study

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Imperial Hotel Case Study

Introduction

Organizations in every industry encounter various challenges that hinder their achievements of set objectives. Some of the challenges faced include operational dysfunctional ties, high costs of operation, increased or stiff competition from rival organizations, poor supplier and customer relationships, poor customer service, and others. There are various causes or antecedents to these problems with many experts arguing that the failure to adapt to changing factors both at the internal and external contexts is mostly to blame. The Imperial Hotel, London, is a perfect example of an organization facing many challenges that have affected the organization's operations and hindered the achievement of its set objectives.

The Imperial Hotel, London, is a 500-bedroom 4-star hotel that is owned and managed as part of a well-known international branded chain of hotels, Star Hotels. Star Hotels operates around 25 hotels in the UK alone and among these is the Imperial Hotel that is located in London's West End. The Imperial Hotel mainly caters for international business and tourist guests with high expectations when it comes to service standards. Despite its 4-star status, Imperial Hotel faces many problems that must be addressed if the organization is to achieve its objectives of profitability and competitiveness. According to the new General Manager, some of these problems include poor guest satisfaction, high staff turnover, a negative work culture amongst the staff, ineffective leadership and management by previous Heads of Departments and supervisory staff, poor team working and inefficient use of IT systems by front house staff, as well as poor operating and control procedures by back house staff responsible for housekeeping, kitchen, and maintenance. This report analyzes the poor guest satisfaction problem in the context of the Imperial Hotel case and provides solutions that may be implemented by the new General Manager.

Overview of the Hospitality Business and the Poor Guest Satisfaction Problem

A primary objective of the hospitality business is to generate revenue while creating wealth for shareholders. The achievement of this objective is majorly dependent on whether the needs of customers, commonly referred to as guests, are satisfied. The term hospitality originated from the Latin word "hospitare" that can be loosely translated to "receive as a guest." Based on this definition, there must be a distinct relationship between the provider and receiver of the hospitality service. In the hospitality sector, the relationship between the two parties is even more sensitive with the business and service delivery going beyond the aspects of price and value (Ogorelc, Snoj, &Petejan, 2005). The relationship also affects both the staff and guests at an intimate level. Notably, the degree or nature of human management in the hospitality business can have significant impacts when it comes to the quality of services provided as well as the satisfaction of guests' needs or demands.

In the Imperial Hotel’s case, the objective of customer or guest satisfaction has hardly been achieved making it one of the six major problems the hotel faces. The hotel was graded lowest in the whole Star chain in terms of overall customer satisfaction running at a rate of 65 percent in the company's benchmark grading system. Surveys on guests' satisfaction also point towards poor guest satisfaction. Most of the hotel's guests regularly raise complaints on issues about checking in and out of the hotel. This is alongside guests' complaints of the poor quality of the rooms themselves and that of staff, reception staff were indifferent and sometimes rude to guests, guests having to wait for long durations in queues at reception both for checking into and checking out of the hotel, and guests being charged incorrectly in their final bill. There are also complaints that there has been little or no timely response to issues raised by guests. The poor guest satisfaction problem is cemented by the growing number of guests critical of the quality of the hotel rooms, particularly the cleanliness of the bathrooms. There have since been numerous requests for room changes with this mainly attributed improper functioning of showers, noisy air conditioners, and the fact that various technologies installed in the rooms are not operational.

According to Gnanapala (2014), one of the factors affecting guest satisfaction in hotels is the nature of front office operations. These include the efficiency and accuracy of check-in and check-out, equality of treating a guest, friendly staff, responsiveness or attention to details, language proficiency, ability to communicate the needed information, giving proper directions, and offering up to standard services. Another factor affecting guest satisfaction is accommodation, which includes how well-furnished facilities are, lighting systems, quietness, proper maintenance, cleanliness, and freshness of the rooms. Other factors with an impact on guest satisfaction in hotels are the level of hospitality, the quality of food and beverages, the nature of recreation and entertainment, security and safety, availability of auxiliary services, location, design and maintenance, pricing and payments, business support services, and marketing strategies(Gnanapala, 2014). In the case of the Imperial Hotel, poor guest satisfaction can be attributed to dysfunctional ties caused by high staff turnover that results in the staff being unaware of the organization’s values and expectations. Also, there is a negative work culture amongst the staff with many cases of sick leave and poor attendance. This factor undermines service provision to guests leaving them dissatisfied. Moreover, the problem of ineffective leadership and management by previous Heads of Department and supervisory staff must have resulted in poor guest satisfaction. With weak leadership and management, staff is unlikely to be committed when it comes to service provision thus resulting in low-quality service provision to guests.

Analysis of and Solutions to the Problem

The poor guest satisfaction problem can be analyzed from two perspectives; the external environmental factors causing the problem as well as the internal factors and the possible solutions to these.

Concerning external environmental factors, there is always the threat of new entrants in the hospitality industry. The risk of new entrants is usually from major or international competitors as entry is accompanied by high capital costs, which is a major barrier for new entrants (Ogorelc, Snoj, &Petejan, 2005). The Imperial Hotel is a big organization and can establish its position in the hospitality industry. Thus, poor guest satisfaction cannot be linked to the threat of new entrants. The risk of substitute products might have a role to play in the hotel's problem of poor guest satisfaction. Guests have access to substitute products or services such as staying in motels or staying with relatives, which might be jeopardizing the hotel's commitment to offering quality services to guests (Ogorelc, Snoj, &Petejan, 2005). The bargaining power of suppliers is also essential in understanding the Imperial Hotel's current problem. In today's hospitality industry, there is a demand for enhanced information and booking capabilities. As a result, suppliers in the industry have become more aware of their position and have had a bargaining power since they can produce specialized products to meet the high demand. With the bargaining power, suppliers have put high prices for their products making it hard for organizations to afford the same and failing to satisfy guests' needs in the long run. The bargaining power of buyers or guests themselves as well as the stiff competition the Imperial hotel faces have also contributed to its current problem of poor guest satisfaction.

Concerning internal factors, one of these believed to be the cause of the hotel's poor guest satisfaction is high staff turnover that results in the situation where staff is not trained in good time because of the urgency in covering for the departing staff (Gnanapala, 2014). Crucial to solving this situation and the resultant poor guest satisfaction is the attraction and retention of staff. As the new General Manager, Peter Farnsworth should focus on offering bonuses and pay packages to staff to encourage their loyalty and motivate them to provide services that meet the needs of guests. Another internal factor believed to be behind the poor guest satisfaction problem is the negative work culture amongst the staff. The staff hardly meets standard operating procedures (SOPS) that end up adversely impacting guest satisfaction. The new General Manager thus has a responsibility of coming up with organizational behavioral standards and expectations with which the expected behaviors and values will be instilled to the staff. Organizational behavioral measures play a pivotal in enhancing the effectiveness of organizations and the overall service provision thus ensuring the satisfaction of guests. Ineffective leadership and management by Heads of Department and supervisory staff is also an internal factor. Weak leadership can be highlighted by the low wages or salaries paid to staff these being under the level that they can afford to offer their services. This sets the stage for poor service provided by the staff. In this regard, the Imperial Hotel's new General Manager must focus on first satisfying the needs of the staff. This move will result in the motivation of staff resulting in high-quality service provision and ultimately guest satisfaction.

Application of Management Theories

Achievement of maximum prosperity for the staff is important in the case of the Imperial Hotel. Thus, it is essential for Peter Farnsworth to consider Taylor’s five principles of management (1911). The first of these principles is the use of scientific methods in the determination of what is the best way of doing things. The second principle he should consider is selecting the best person both physically and mentally to lead the staff and oversee the provision of quality services that meet the needs of guests. Other key principles that the new General Manager should consider, according to Taylor, are training, teaching, and developing staff according to prescribed methods; providing appropriate financial incentives; as well as planning and organizing all activities and departments of the organization (Turan, 2015).

Another theory ideal for the new General Manager in the Imperial Hotel's current situation and the problem is Mintzberg’s theory developed in 1973.  Mintzberg suggests that in such a situation and to address the issue at hand, the manager’s work can be divided into three categories of roles including informational, decisional, and interpersonal (Kumar, 2015). The interpersonal role category where the leader or manager resorts to managing through people is the most appropriate for resolving the hotel’s problem. Based on the interpersonal role category, Farnsworth should serve as a figurehead by performing social and legal duties and acting as a symbolic leader. He should also serve as the leader whereby he directs and motivates and selects and trains staff. Moreover, he should act as a liaison whereby he establishes and maintains contacts within and outside the organization (Kumar, 2015).

Conclusion

This report explores poor guest satisfaction as one of the problems faced by the Imperial Hotel. The antecedents or causes of this problem are the high staff turnover (80 percent leaving within a year) that leaves the remaining staff untrained because of the urgency of covering for the departing staff, a negative work culture amongst staff, as well as ineffective leadership and management by heads of department and supervisory staff. Practical solutions to each of these causes could help to address the overall problem of poor guest satisfaction. Concerning high staff turnover, the new General Manager must focus on attracting and retaining staff and offer them better packages and bonuses. Regarding negative work culture amongst staff, the new General Manager must come up with organizational behavioral standards and expectations that will ensure that company expectations and values are instilled to the staff. For ineffective leadership and management by heads of department and supervisory staff, the new General Manager must focus first on satisfying the needs of staff; a move that would motive and encourage them to ensure guest satisfaction. Two managerial approaches would help to solve the poor guest satisfaction problem. One is Taylor’s five principles of management (1911) with the other being Mintzberg’s theory.

References

Gnanapala, A. C. (2014). Factors affecting customer satisfaction related to the tourist hotel industry in Sri Lanka. Journal of Tourism and Hospitality Management, 2(7), 265-278. Retrieved from https://www.researchgate.net/profile/Athula_Gnanapala/publication/309273235_Factors_Affecting_Customer_Satisfaction_Related_to_the_Tourist_Hotel_Industry_in_Sri_Lanka/links/58558d1808aeff086bf935ae/Factors-Affecting-Customer-Satisfaction-Related-to-the-Tourist-Hotel-Industry-in-Sri-Lanka.pdf

Kumar, P. (2015). An analytical study on Mintzberg’s Framework: Managerial roles. International Journal of Research in Management and Business Studies, 2 (3), 1-19. Retrieved from http://ijrmbs.com/vol2issue3/drpradeep.pdf

Ogorelc, A., Snoj, B., &Petejan, A. (2005). The analysis of competitive forces: The case of hotel enterprises. Tourism and hospitality management, 11(2), 41-49. Retrieved from https://hrcak.srce.hr/file/267202

Turan, H. (2015). Taylor's scientific management principles: Contemporary issues in personnel selection period. Journal of economics, business and management, 3(11), 1102-1105. Retrieved from https://pdfs.semanticscholar.org/1b58/d14d3679bc5a0a191031a176e73acdc87127.pdf