Strategic Management Hilton Hotel - Research Paper Example

CONSULTANT REPORT: Recommendations for Strategic Business Improvements BY YOU YOUR ACADEMIC ORGANIZATION HERE HERE HERE CONSULTANT REPORT Client Brief Hilton Hotels is one of the largest, publicly traded lodging and resort facilities across the globe. Hilton maintains a wide variety of different accommodations, including more elite and upscale facilities catering to the wealthier consumer as well as the more budget-conscious traveler looking for inexpensive, yet family-oriented lodging. Despite Hilton’s historical success in profitability and outperformance of similar market competition, Hilton Hotels is rapidly losing market share in the hospitality industry to other hotels due to limited innovation, ineffective marketing practices, and the inability to recruit and retain quality workers who remain committed to assisting Hilton in reemerging as a hotel industry leader. In this report I identify numerous recommendations for business improvements as part of a radical change in strategic initiatives, including implementation of GPS technology for all staff members, training on guest-related cultural values, meetings and online blogs for discussion of staff issues, stress-reduction activities, the development of a talent manager at all facilities, reorganization of existing IT functions, and the development of a change manager to assist in avoiding employee resistance. Recommendations for Competitive Improvements Lee, Chu and Tseng (2009) clearly offer that technology improvements are key to building a more competitive organization, in a multitude of different business industries. At Hilton Hotels, as part of a new strategic business process reengineering strategy, I recommend that the Board consider adopting a new technologically-focused internal operations philosophy. This recommended course of action will include equipping all staff members with GPS technology which pinpoints the current location of housekeeping, restaurant, front desk, and management staff members. Because Hilton Hotels relies on maintaining quality customer service and maintaining absolute visibility to ensure a quality guest stay, I project that this new technology will provide management with instant staff locations internally in the event of potential guest issues, needs or concerns. This revolutionary approach to managing the organization and activities of staff is a unique innovation in the hotel industry and is expected to provide higher levels of customer loyalty (return customer ratios) and securing a more positive brand image for the Hilton group. Because Hilton is rapidly losing market share in regards to client loyalty, the business cannot afford to miss this opportunity to ensure 100% guest satisfaction. From a budget perspective, this new access to staff organization can further minimize the needs for redundant employee volumes, thus saving costs in the long-term. Improving Customer Service Understanding the client, based on their unique needs and values, is always key to hotel industry success. From a brand-building perspective, Pence (2008) offers a unique model for understanding the different target markets which are most likely to frequent Hilton Hotels in their travel ventures, known as the VALS 2 marketing model. Figure 1 illustrates the model. As described in VALS 2, there are eight specific segments, each with unique consumer traits, such as the adventure seeker or the striver group, with each segment identified by their unique financial resources and customer preferences. In order to improve customer service, I recommended that junior and senior managers become familiarized, through formalized training seminars, about what the VALS 2 model represents and offer suggestions on how best to change internal operational philosophy to best suit the needs of each likely target group in a wide variety of different hotel environments. For instance, under VALS 2, at one of Hilton’s more budget-conscious facilities, the believers group tends to trust authority and is conservative by nature (Pence). Hence, at budget-minded Hilton Hotels, leadership through conservative philosophy would likely draw better customer service and higher levels of return customer patronage. This training seminar should be constructed immediately and delivered to all managers responsible for global personnel training and improvement. Figure 1 – VALS 2 Marketing Model Source: Franteractive.net, 2008. Becoming a learning organization One management expert identifies that in order to ensure business sustainability, “you need the workforce’s input” (Cummings, 2008, p.37). It can be reasonably deduced that no single manager or leader group is going to be able, through their own efforts, to come up with solutions which can best secure the long-term profitability and success of the Hilton Group. This is why I recommended for Hilton to become a learning organization, by conducting regular staff/management meetings to brainstorm solutions to problems which occur on a daily basis at Hilton Hotels. Staff members, more so than managers, have routine face-to-face contact with guests and are privy to their unique needs. As part of this recommendation, all staff members should be given the opportunity to discuss their own viewpoints on guest solutions in both formalized and informal meeting environments where information can be exchanged regularly. In the event that such a meeting is impractical, an online information and suggestion exchange forum, through dedicated internal email systems, should be immediately adopted. Further, by setting up a daily blog for review by management personnel, Hilton can routinely exchange concerns and information about guest services to routinely improve response options and change staff organization philosophy in the process. Creating more creative and innovative employees The hotel industry is often wrought with unusual stresses, which is common in industries where regular service of differing public demographics occurs. In order to inspire creativity, I strongly recommended implementing a stress-reduction initiative, which could be termed People Notice, in which managers inspire workers to freely express their stresses and offer solutions on how to reduce workplace stress caused by client interactions. Hunter and Bandow (2009) suggest clearly that higher staff stress levels often lead to decreased business profitability and poor management/staff relationships. This is something Hilton Group cannot afford during this difficult period of lost market share. Because many Hilton hotels provide massage and relaxation therapies for guests, staff should also have access to these amenities when management has deemed legitimate stress-induced workplace concerns or traumas. This is a low cost method for Hilton to ensure that staff members remain focused on offering dedicated service and providing potential solutions to innovate Hilton’s internal guest experiences. A stressed out workforce is a detriment to long-term success. Recruiting, Retaining and Rewarding Employees Ulrich, Smallwood and Sweetman (2009) offer a rather unique method to ensure that employees remain dedicated to excellence through the development of an in-house talent manager. A talent manager “engages and empowers employees” through coaching and development practices (Ulrich et al, 2009, p.12). I suggest, to avoid higher payroll budget issues, that one junior member of each hotel group be trained on the principles of mentoring and staff career-progression training to assist in this process. By illustrating a compassionate and considerate effort on behalf of Hilton, employees are expected to remain focused on service excellence with the promise of being rewarded for compliance and learning through promotional incentives. In terms of recruitment efforts, I again recommend that the business use other hotel environments as benchmarks by consulting with various industry advisors, such as Staffing.org (Bos, 2008), to offer advice on how contemporary employees can be screened for competency in the virtual environment. This is yet another low cost, innovative method to secure better retention of quality employees and these consultations with various experts should begin immediately via senior management intervention. Becoming More Technological at Hilton One major disadvantage at the Hilton Group is poor information systems development and distribution of monitoring the firm’s electronic systems. Santa, Ferrer, Bretherton and Hyland (2009) offer that a well-aligned IT system, with quality and speed from IT professionals, is key to securing competitive advantage. Currently, the business’ call centers are maintained over a wide geographic environment, thus giving Hilton group much less control over IT activities related to electronic guest-related information systems. As a new strategic recommendation, Hilton Group must consolidate these activities, thus eliminating excess staff globally, and give a singular IT support group control over call center functions. By coordinating all IT support services in a region where constant supervision and monitoring can occur by senior management officials, the cost savings and ability to streamline existing IT technologies can occur at a much faster pace than ever before. I anticipate that the timescale for this improvement should take no less than two months and no more than six months to radically redevelop Hilton’s information systems infrastructure. Overcoming Employee Resistance In any industry, there will always be groups of employees and managers who will resist changes. Cummings again identifies that employee resistance is largely caused by poor structure of change practices which are not given a great deal of clarity in terms of what is expected by staff and management. The key recommendation for avoiding employee resistance to all of the aforementioned internal changes is to inspire staff members to become actively involved in these changes and clearly understand their individual, unique expectations for their role in change. Morris and Maisto (2005) offer that many employees, if they feel their belonging needs are being affected negatively by change practices, will simply act out against any needed internal, operational changes. Therefore, I further recommended that the newly appointed talent managers also take on the role of change manager to create a solid structure for the new operational architectures and address any concerns about employee involvement in these efforts. The goal is to make employees feel like they belong as part of the Hilton family and make them excited and interested in the positive aspects of these new strategic changes being proposed. Alternative Solutions for Economic Downturns From a marketing perspective, pricing will be a major consideration in the event of economic downturns when profits are marginal against expectations. Meehan and Jaworski (2009) offer that investing more heavily in marketing communications is one key successful strategic option to survive economic crises. The Hilton Group, offering potential customers, using a loyalty, online or email mailing system, can offer free amenities, such as massage services or discounted in-hotel meal certificates, as part of a new customer relationship marketing focus to draw in higher volumes of customers. Since massage services are already provided in-house by dedicated staff members, there is little cost to the business to offer these free or highly-discounted services as a means to enhance brand image and also ensure higher guest volumes. These loyalty programs are recommended as alternative solutions, and also to improve customer service perceptions by potential guests, in the event that Hilton Group experiences significant and measurable declines in profitability and lost market share. Such systems can be developed at very little cost to the business, by using existing dedicated email and information technology systems, needing only to be monitored several times weekly by junior management personnel. Using inexpensive and simple software, such as Microsoft Excel, I firmly believe the response ratios to various loyalty and service programs can be monitored for success and deleted/enhanced based on profits earned as a result of customer responses to these new strategic alternatives. References Bos, Julie. (2008). “Top Tips for Driving RPO Success”. Workforce Management, Costa Mesa. 87(10): 30-35. Cummings, John. (2008). “Why Most Change Initiatives Go Thud”. Business Finance. Loveland. 14(8): 37. Hunter, D. and Bandow, D. (2009). “Abusive Managers and Variables Impacting Retaliation in Organizations”. The Business Review – Cambridge. Hollywood. 12(1): 32-39. Lee, Y., Chu, P. and Tseng, H. (2009). “Exploring the relationships between information technology adoption and business process reengineering”. Journal of Management and Organization. Lyndfield. 15(2): 170-186. Meehan, S. and Jaworski, B. (2009). “Perspectives for Managers: Don’t Waste the Crisis – Opportunity Knocks!”. Retrieved 17 July 2009 from www.imd.ch Morris, M. and Maisto, A. (2005). Psychology: An Introduction. 12th ed. McGraw-Hill Irwin. Pence, Amber. (2008). “Psychographics”. Retrieved 18 July 2009 from http://frontpage.wiu.edu/~mfjtd/psychographics.htm Santa, R., Ferrer, M., Bretherton, P. and Hyland, P. (2009). “The necessary alignment between technology innovation effectiveness and operational effectiveness”. Journal of Management and Organization. Lyndfield. 15(2): 155-170. Ulrich, D., Smallwood, N. and Sweetman, K. (2009). “Leadership Code”. Leadership Excellence, Provo. 26(3): 12-14. ABI/INFORM Global Database. Retrieved 17 July 2009. Consultant Report OUTLINE 1.0 Client Brief: Problems at Hilton Hotels 1.1 Reasons for loss of Hilton market share 1.2 Listing of specific recommendations made in report 2.0 Recommendations for competitive improvements 2.1 Technology changes 2.2 Reorganizing and minimizing staff through technology 3.0 Improvement of customer service at Hilton 3.1 Introduction of a new marketing model – VALS 2 3.2 Seminar and training recommendations to improve service 4.0 How to become a learning organization 4.1 Brainstorming sessions with all staff members 4.2 Exchange of ideas and information through existing online technology 5.0 Innovative and creative employee recommendations 5.1 Stress as a problem 5.2 Stress as a loss to profitability 5.3 Changes proposed to include staff access to guest amenities 6.0 Recruitment, Retention and Reward of Employees 6.1 Talent manager creation 6.2 Benchmark other industries for recruitment 6.3 Rewarding through promise of staff promotions 7.0 Recommendations for more technology at Hilton 7.1 Altering existing IT – centralizing IT 7.2 Proposing timeline for changes to IT support and infrastructure 8.0 Overcoming employee resistance 8.1 Development of change manager 9.0 Strategic solutions for economic crises 9.1 Invest more heavily in marketing 9.2 Offer guest better, discounted amenities 10.0 References Read More