Work Diversity at Hotel Oliver Plaza - Case Study Example

Work diversity Table of Contents Work diversity 1 Another facility which makes the place so attractive is its high connectivity to major tourist and entertainment area of London. 4 Description of diversity stages within the organization at present 5 Diversity DNA Helix is a strategic tool which helps the organization to identify their diversity level which includes staff, environment, organization culture and the resource. Such an analysis helps the organization to improve their present state. On the basis of such analysis the organization can set their goals for diversity and for further improvement. 5 Concentric diversification: As per this strategy the firm may introduce some new services into its existing portfolio. But this can be done only if organization knows that the quality of new service will be accepted by their existing customers and they are loyal toward the organization. 12 Horizontal diversification: As per this strategy the organization may enter into new business (either related or unrelated). Through this the organization gets an opportunity to enter into new market. 12 Conglomerate diversification (or lateral diversification): As per this strategy the organization starts marketing new services which have no technology similarity with the existing product. The main reason behind such diversification is to increase the profitability and to attain growth. 12 When ever the organization wants to diversify, they should carryout full analysis of their project and each and every step should be well planed. 13 Authentic: An authentic organization has certain specific features. The organization always reflects what is true. It means telling the truth to the outsiders as well to the insider no mater whether it is positive or negative. This can be achieved by inculcating transparence within the management by the top management. The organization should reflect the qualities which matter to them. They should have clear objectives which they communicate to their employees from the very first day. On basis of these objectives, the organization develops its image in the society. 13 Hotel Oliver Plaza is a medium size, family run organization, so the level of transparency is quite low. They can easily manipulate the facts their image. But as the organization will grow and diversify, it will difficult for them to manipulate the situation. This may have a negative impact on the image of the organization. So from the very beginning they should bring transparency in their management. 13 Conclusion 13 After carrying out a detailed analysis on the Hotel Oliver Plaza it is found that the hotel which is right now medium sized families run organization, has the potential to enter into new market for diversification. But before diversifying it is important to understand “what means by Diversity”, why cultural diversity matters”& “how to develop cross cultural interaction” (Miller J. E, Walker J. R. & Drummond K. E., 2006). Hospitality industry is a fast growing industry, hence if they want to grow they have to diversify themselves. Data reveals that tourism is growing day by day in the developing countries. In such developing countries the cost of production is also low. If Hotel Oliver Plaza provides their present services in the developing countries, it will be highly accepted as the organization will grow at a much higher rate. But before making any decision the organization should collect all necessary information. 13 Reference 14 Introduction 6 Description of diversity stages within the organization at present 7 Conclusion 16 Reference 17 Introduction Hotel Oliver Plaza – London is a medium sized hotel, located in “London's well known area of Earl's Court” (Hotel Facilities at a glance, n.d.). This hotel is run by a family which makes its environment more warm and friendly. London is a hot tourist spot which attracted people through the world. So Hotel Oliver Plaza has become the first choice of the tourist who wants to enjoy their tour by exploring the area in best possible way. “This hotel is near to the very famous shopping area of Kensington and Knightsbridge”. (About Hotel Oliver Plaza, n.d.). The other destinations which are near to the hotel are- “Kensington Palace, Royal Albert Hall, Earls Court Exhibition Centre, Olympia Exhibition Centre, Natural History Museum, Science Museum, Victoria and Albert Museum” (Hotel Facilities at a glance, n.d). Another facility which makes the place so attractive is its high connectivity to major tourist and entertainment area of London. “It has 46 bedrooms which can be categorized into Standard, Executive and Family. The rooms are well equipped with the all basic facilities such as tea and coffee making facilities, wireless internet connection, satellite TV and many more” (Hotel Facilities at a glance, n.d). “The hotel’s average guest rating is around 6.8” (About Hotel Oliver Plaza, n.d.) Cleanliness of room-6.8 Quietness of room-6.8 Spaciousness of room-4.4 Quality of service provided-6.6 Hotel surrounding-8.1 (Hotel Oliver Plaza) All these data clearly explains that the hotel management pay a lot of attention on the quality of service they provide to there customer. The company being into the hospitality industry also takes good care of the quality of their staff members. They are well trained and customer friendly. The hotel takes into account the different requirement of their customer as they belong to the different class and cultures. Their main aim is customer satisfaction. There is a tough competition in hotel industry, so to sustain into the top position they always maintain high level of efficiency. One of the best ways to attain growth is through diversification. But before going for diversification the hotel should check out that whether they have the potential and whether such diversification will serve their purpose. For this a detailed study was conducted to know the present state of the hotel and what changes the hotel should incorporate to successfully diversify. For this Diversity DNA Helix model was referred. (Diversity DNA Structure, n.d.) Description of diversity stages within the organization at present Diversity DNA Helix is a strategic tool which helps the organization to identify their diversity level which includes staff, environment, organization culture and the resource. Such an analysis helps the organization to improve their present state. On the basis of such analysis the organization can set their goals for diversity and for further improvement. In a competitive environment, the competitor can copy the policies, strategies, suppliers, buyers but they cannot easily copy the quality of the employees. Efficient employees are the biggest asset for any organization. In a hospitality industry the most required thing is diversity. But before diversifying it is important to realize that will the hotel management be able to handle a new culture, new language, customers who belong to the different culture, who have different value system and who have different need. The organization should be care full that the environment should be such that the employees as well as the customers feel comfortable. Analysis of Hotel Oliver Plaza- Compliant- in an organization the term compliance mean the external and internal regulations, policies, standards and governance which the organization follows to attain success and to handle the competitors. Hotel Oliver Plaza is working in a highly competitive industry so the data of the organization is highly confidential. The organizations which are in hospitality industry have to be over cautious about the policies which they follow. Hotel Oliver Plaza being a medium size organization does not pay much importance to compliance. After analyzing it can be concluded that many well known hotels had suffered from business losses due to the problem of compliance and security. Hospitality sector is one of the fast growing sectors which have huge potential. Though due to world economic recession, business of many hotels has gone down, but impact is more on the big hotels. As soon the economy will revive, this sector will start growing at much faster rate and the competition will be much tougher. So Hotel Oliver Plaza can go for diversification but should adopt the necessary compliant tools’ Risk minimizing- “risk assessment is a systematic and structured way which analyzes the causes of risk, their nature and their hazardous consequences. It helps the organization to reduce risk to the tolerable level so that its impact can be reduced” (Cholamandalam MS Risk Service, n.d.) Hotel industry is a service industry so it should be highly cautious about the quality of it service. As it deals with non hazardous substances like food and beverages, there is a common belief that the risk associated with hotel industry is less. But on the contrary there is a high chance of food contamination and environment pollution. The management has to be highly alert about such factors. Along with all these risk the major risk is the non-satisfactory service. As because the different customers in hotel are from different culture, with different believes and requirement; hence the management should diversify itself by keeping these foctors in mind. In Hotel Oliver Plaza, management pays much attention on the decoration as compared to the safety. As It has got 6.6 rating in cleanliness and service quality by its customers (About Hotel Oliver Plaza, n.d) So it can be said that Hotel Oliver Plaza should take cleanliness and hygiene more seriously but again the dome of hygiene differ from country to country and culture to culture. The other types of risks for which Hotel Oliver Plaza should remain prepared are natural disasters, industry risk, political risk, financial risk, legal liabilities, corporate reputation, and also environment risk, food contamination risk and microbial risk. For environmental risk, food contamination risk and microbial risk the hotel management can adopt any reliable latest techniques for food preparation and preservation. Different sterilization techniques are available to handle microbial risk and the best way to handle environment is by creating awareness within the organization as well as among the customers. For handling the financial risk, Hotel Oliver Plaza should maintain a balanced capital structure. There should be moderate level of financial leverage. The organization should make in-depth cost analysis to identify the cost centers. By reducing the cost, company can enhance their operating profit margin. But after diversification they also have to manage foreign currency risk which will result from fluctuation of the domestic currency and the foreign currency in which they will go on diversification. For handling political risk and legal risk, Hotel Oliver Plaza should become more aware about political and legal environment of their home country and the foreign country in which they are going for start their new venture. They should take the help of experts regarding financial and legal matters. One of the easy method to over come this problem is by employing the native people as they are well accustomed with the rules and regulations. Competitive/aware: The present world is called a global village. Businesses have crossed their boundaries. People travels to different countries for adventure and fun, some go to view the natural beauty where as some travel even for shopping. The basic reason behind is the rise in living standard to people in the developing countries. All this had a positive impact on the hospitality industry. It started booming at a much faster rate. But this has increased the competition due to entry of new entrant which has resulted into strong rivalry among the competitor. To understand the strategy adopted by hotel to fight against their rivals, a survey was conducted. A questionnaire was distributed through postal service, e-mail, even handed personally. Around 108 hotels from 7 cities responded. 94.6% of hotels said that their business in not just seasonal. As per the survey the main reason behind traveling was business tours which stand around 15.2% and leisure tourist are just 10.2%. (Padurean A. & Tuclea C., 2008). As per the survey the competiveness factors are as follow: Competitiveness factors Score competitive environment 3.2 legislation 1.8 general infrastructure (access ways, telecommunications, public utilities, etc.) 1.7 level and evolution of demand 4.4 hotel emplacement 2.9 the business environment’s quality from an ethical point of view 1,75 1.75 ability to innovate 2,7 2.7 quality of human resources 3,85 3.85 tariffs 4.1 cost control 4.2 service quality 4.5 the diversity of services offered 4.3 brand 2.8 ability of interacting with partners 2.6 adaptation to the changes in the external environment 3,6 3.6 promotion 3,9 3.9 Source: (Padurean A. & Tuclea C., 2008) After identifying the factors of competition the next important thing was to know how these factors can be managed. On basis of the responses received for those 108 respondents it was cleared that many measure had been taken which are as follow: Factors for raising future competitiveness Factors Number of answers Percentage (%) service quality 68 65.4 cost control 55 52.9 innovation capacity 47 45.2 legislation, including policies and community programs; infrastructure 41 39.4 quality of human resources 38 36.5 Source: (Padurean A. & Tuclea C., 2008) So all these factors indicates that what are the prevailing strategies adopted by the hotel Industries to handle the growing competition. Hotel Oliver Plaza is a medium size hotel so basically to overcome the competition they keep the price of their room as low as possible. As per the present scenario when the whole world is under global recession low prices may attract the customer but still the first preference is the high quality service. Customer always tries to get full value of their money, so they have high expectation. As the per the organization’s policy they must go to such countries where low prices are highly accepted by customers. In many developing countries tourism is increasing day by day. The foreigner tourists some time have a stringent budgeted, so they try to invest less on their hotel stay. But they do demand the basic standard of service. The hotel should have a more diversified portfolio of services which one can choose as per their preference and budget. Committed / reflective: Hotel Oliver Plaza does not have a large work force so it is easy enough to handle them right now. Management allow their employees to participate in the decision making process. The employees feel themselves as pert of the organization. They are highly motivated and committed toward their organization. Organization also takes proper care to fulfill the requirement of their employees. Being a family run hotel, the whole work force feels themselves as a big family. But soon as the business will grow, the size of work force will also grow. This will result into a highly diversified work force which has different views and different needs. So the management should start taking steps to handle a diversified work force. For being successful, the organization should have a highly committed work force. Right from the top management to the ground level employees, the motto should be to attain the organizational goal. For this the major responsibility lies on the top management. From the very beginning management should make the aims and goals clear to their employees. Their objective should be directly correlated to their present domain of working. Management should have a clear vision about the changing economic scenario and the changing needs of customers It is a proven fact that change is the only constant thing in this universe, so the management should always search for change and should take benefit out of it. For better management, the goals should be broken down into objective. These objectives are first at division level which gets broken down to departmental level. They should be further break down into objectives which are allotted to the individuals. This makes the individual well aware that what the organization is expecting from them. Performance of each individual is measured against these standers and as per their performance they can be awarded. This not only makes the employees highly motivated but also increases their commitment toward the organization. Aspirational: Hotel Oliver Plaza is a growing organization so the growth factors it self is hugely inspiring to it. As the hotel is a family run concern; so management has a tightly control on it working. They have simple procedures for taking decision where employees play a vital role. This makes the environment friendlier to work. But as the hotel will go for diversification, they have to develop corporate culture. The major aspiration for this organization is to grow itself into a big, highly diversified and most popular hotel. There are many other minor aspiration factors which support the organization to grow. Among them the most important is profit factor. For all organizations the main aim is to make profit for itself and for its shareholders. As for being successful, the organization needs a highly motivated workforce. If the hotel let their employees to share the profit margin in form of incentive and bonuses, then the employees will feel as the part of organization and will give their full effort for its development. Strategic: As Hotel Oliver Plaza is planning to diversify its management, hence it is very important for them to analyze their present state and to check the opportunity available in the different markets (countries). First they should carry out a SWOT (strength, weakness, opportunity & threat) analysis. This helps them to identify the strengths and weaknesses which are prevailing inside the organization as well as the threats and opportunities which they are facing from outside. They should also carry out PEST (political, environmental, social & technical) analyses of the new market in which they are playing to enter. As hotel business is a capital intensive business so before taking any decision in-depth research work should be carried out. Hospitality industry being a highly competitive industry, it is better to carry out “Porter’s Five Forces” (bargaining power of buyers, bargaining power of suppliers, threat of new entrants, threat of substitute product, competitive rivalry within an industry) analyses. It helps to analyses the threats which an organization is facing from its competitors and which strategy can be adopted to overcome them. There are many methods of diversification such as- Concentric diversification: As per this strategy the firm may introduce some new services into its existing portfolio. But this can be done only if organization knows that the quality of new service will be accepted by their existing customers and they are loyal toward the organization. Horizontal diversification: As per this strategy the organization may enter into new business (either related or unrelated). Through this the organization gets an opportunity to enter into new market. Conglomerate diversification (or lateral diversification): As per this strategy the organization starts marketing new services which have no technology similarity with the existing product. The main reason behind such diversification is to increase the profitability and to attain growth. When ever the organization wants to diversify, they should carryout full analysis of their project and each and every step should be well planed. Authentic: An authentic organization has certain specific features. The organization always reflects what is true. It means telling the truth to the outsiders as well to the insider no mater whether it is positive or negative. This can be achieved by inculcating transparence within the management by the top management. The organization should reflect the qualities which matter to them. They should have clear objectives which they communicate to their employees from the very first day. On basis of these objectives, the organization develops its image in the society. Hotel Oliver Plaza is a medium size, family run organization, so the level of transparency is quite low. They can easily manipulate the facts their image. But as the organization will grow and diversify, it will difficult for them to manipulate the situation. This may have a negative impact on the image of the organization. So from the very beginning they should bring transparency in their management. Conclusion After carrying out a detailed analysis on the Hotel Oliver Plaza it is found that the hotel which is right now medium sized families run organization, has the potential to enter into new market for diversification. But before diversifying it is important to understand “what means by Diversity”, why cultural diversity matters”& “how to develop cross cultural interaction” (Miller J. E, Walker J. R. & Drummond K. E., 2006). Hospitality industry is a fast growing industry, hence if they want to grow they have to diversify themselves. Data reveals that tourism is growing day by day in the developing countries. In such developing countries the cost of production is also low. If Hotel Oliver Plaza provides their present services in the developing countries, it will be highly accepted as the organization will grow at a much higher rate. But before making any decision the organization should collect all necessary information. Reference About Hotel Oliver Plaza, no date, Hotel Oliver Plaza – London, venere.com, [online], available at: http://en.venere.com/hotels_london/kensington_earls_court/hotel_oliver_plaza.html?fe1&ref=630444&kwp=73-h20880#information [03 June 2009] Cholamandalam MS Risk Service, no date, “Why Risk Assessment Is Required For Hotel Industry?” Risk Assessment – Hotel Industry, [online] available at: http://www.cholarisk.com/Files/Risk%20Management%20Brochure%20for%20Hotel%20Industry.pdf [03 June 2009] Diversity DNA Structure, no date, Diversity @ work, [online], available at: http://www.diversityatwork.com.au/files/awards/DNA_Model_Brochure.pdf [03 June 2009] Hotel Facilities at a glance, no date, The Oliver Plaza: London, Capricorn Hotels, [online] available at: http://www.capricornhotels.co.uk/hotel_oliver/ [03 June 2009] Miller J. E, Walker J. R. & Drummond Karen Eich, 2006, Supervision in the hospitality industry: applied human resources, fifth edition [e-book], John Wiley and Sons, available at: http://books.google.co.in/books?id=vkl1-24f9rIC&pg=PA82&lpg=PA82&dq=diversity+in+hospitality+industry&source=bl&ots=dMNSS5wvLW&sig=4rexs5qvWASPDPDLa5zYlJ2QHGA&hl=en&ei=RrwkSt2oDc6dkAXP6v3eBg&sa=X&oi=book_result&ct=result&resnum=8 [03 June 2009] Padurean A. & Tuclea C., 2008: “Competitiveness in Hospitality industry:” Management & Marketing Craiova Romanian Style”, available at: www.ceeol.com/aspx/getdocument.aspx?logid=5&id=7D648EC3-6062-42E4-8A46-06EBFFA1B380 [03 June 2009] Read More